Anglo-eastern Plantations Share Discussion Threads

[woracle] 25/2/2010 08:33

hvs, currency wise, $ strength vs UKP is much more relevant for us here and its improving at the mo. As for competition, fair point but cant say how competitive AEP really are vs other producers.. u have to look at margins really for comparison. Its not just wage costs that determine competiveness.. yield, logistics etc are massive factors . However, its a demand supply equation that gets stronger by the year and so AEP is strategically better place than any UK quoted producer IMO. NBPO .. havent looked at specifics of their aquisition yet, but for sure AEP will trade at PE 16 again one day.

[hvs] 25/2/2010 08:23

Hi woracle,

I am missing the point you are making. As the inference from previous comment was strength in IDR.

I am not invested here for short term gain but for 2014 and beyond and as I see
it AEP is in a very good competitive position as Indonesia is a lower cost
producer compared to competitors.

Do you have any comments on the NBPO acquisition and price paid. Feel AEP is
very undervalued based on the price paid.

Your thoughts would be highly appreciated.

[woracle] 25/2/2010 08:18

hvs, you missed the point muangsing is getting at....MS, IDR costs i agree are up 25% vs USD however 9300 is essentially just historical average over last 5 years. The spike to 12000 during Oct 08 to 09 was exceptional. So nothing out of the ordinary on historical basis. IDR pretty much loosely linked to $ going foreward as most AP currencies.

[hvs] 25/2/2010 07:51

Sorry meant to say Ringgit.

By long term I mean to say Malaysian currency will stay stronger than Indonesian Ruppiah so AEP will always be more competitive. Workers pay in
Malaysia will also be higher than in Indonesia so AEP is very well placed.

Yesterdays announcement by NBPO of buying 80% of 26,000 hectares in Papua
New Guniea for £ 112 mill shows how cheap AEP is at todays levels as it is
on course for developing more than 100,000 hectares by 2014.

AEP is a STEAL a share to buy for your grandchildren.

[muangsing] 24/2/2010 17:06

hvs

Don't understand

Malaysian Rupiah?????

Also not sure what "will not hurt long term"?

[hvs] 24/2/2010 16:59

As long as CPO keeps firm and rising it will not hurt long term as Malaysian
Ruppiah is stronger.

[muangsing] 24/2/2010 16:55

hvs

What about the strength of the Indonesian Rupiah?

[hvs] 24/2/2010 09:27

NBPO keeps on going up and we are static trying to break 400p.

Think this will spring up nearer results.

[notanewmember2] 23/2/2010 17:18

No? Palm oil cause of global warming, CO2 emissions? Extinction of 100 species a day?

That's fine, scare out the weak hands.

[hvs] 23/2/2010 10:22

Anyone see Panorama , last night ?

A bunch of troublemakers with nothing better to do IMHO.

[hvs] 18/2/2010 11:49

Bought a few more today.

Will keep on buying at these levels.

[hvs] 18/2/2010 08:49

CPo has broken through USD 800 per ton and still showing a rising trend.

I feel we will see a pleasant increase in divi this year. Think the general economic situation last year made then over cautious.

[shanklin] 17/2/2010 15:36

ok, thank you woracle

[woracle] 17/2/2010 15:34

Depends on the capital program needs but with so much new acreage to plant and re-plant over the next 5 years, I suspect that is what most of the free cash will be spent on rather than massive dividends in the period. Its always been highly cash generative, but this is a period where a step change occurs from being a small 40K to a medium sized 130K ha player.

[shanklin] 17/2/2010 15:16

Any thoughts please on how the dividend is likely to evolve over time? Its a shame it was cut back 64% last year. Surely at some point AEP will become highly cash generative and could afford a significantly higher dividend?

[woracle] 17/2/2010 12:15

Well summerised. Easy business to understand and extremely well managed. Tax regimes will always be an unavoidable and ever changing political issue. Indo's long term strategy is to limit the amount exported to ensure they feed their own first. Can only cause more global shortages and price rises long term. I think that hedge fund is still mopping up, accumulating at the moment. What is interesting is the majority shareholders are getting a bit old and who knows what they want to do with it...

[shanklin] 17/2/2010 11:25

Thank you all, very helpful. From what you're saying, it looks like those estimates I posted from REFS are more likely to be USD rather than GBP denominated

In terms of the earnings trend, there seem to be two drivers, one definite the other uncertain. Namely:
- AEP will continue to increase the planted acreage and the average yield/acre on that acreage will increase from current levels, albeit I take on board the points made earlier in the thread that it may not have the most fertile acreage
- the price of palm oil is quite likely to increase over time... although it is clearly quite volatile when viewed over a period of a year or two. However, AIUI from earlier posts, the applicable sliding-scale tax regime means that AEP is not exposed to the full extent of the variation in the price of palm oil

No position as yet in AEP but certainly keeping an eye on them

Cheers, Martin

[woracle] 17/2/2010 09:09

Shankin, AEP is a pretty easy business to estimate for if u can estimate the price of CPO. Noone has a crystal ball but those figures will be based on their estimated average CPO price. But its like most resources, long term trend is up. I think 80c for 2009, and 101c for 2010 based on CPO average 820

[hvs] 17/2/2010 09:03

Well I am looking for between 50-55p this year.

[wjccghcc] 17/2/2010 09:02

I think those forecasts are in cents since H1 EPS was 35.6 cents.

[hvs] 16/2/2010 14:09

Thank you for reply Shanklin.

I feel the estimates are realistic and we will get a divi boost over the next two to three years.

This is a well run cash generative company that one day will receive a very
generous bid.

[shanklin] 16/2/2010 14:07

hvs

The estimates are on REFS. As you indicate, it would certainly be interesting to see the research.

[hvs] 16/2/2010 13:03

Those estimates are attainable.

Grateful if you can please post their research. Thank you in advance.

[shanklin] 16/2/2010 13:02

Having just read the last 500+ posts, this is certainly an interesting thread.

I see that on 23-Oct-09, Virtua Research Corp issued EPS estimates of 79.7p and 88.1p for AEP for 2009 and 2010. Do you guys see these estimates as realistic or should they be denominated in cents?

Any help much appreciated... and any idea as to why woracle doesn't post here as much as he used to?

[hvs] 10/2/2010 08:04

The wall will go in good time.

CPO holding up very well. We will see substantial increase in divi.