Dekel Agri-vision Share Discussion Threads

[here and there] 09/4/2017 18:01

On a PE of 6 for 2017, about to pay first divi, Gervais Williams owns 20% and tipped by The Midas column today….great bit of PR

[empirestate] 09/4/2017 13:37

Well done Riv, the timing of the article is great, we should see if seller is truly out with buy side action on Monday.
Well overdue a re-rate to more sensible p/e valuation levels on the sp

[rivaldo] 09/4/2017 12:49

Cheshire Man, looks like I beat both you and badgerry to it :o))

[badgerry] 09/4/2017 10:21

Good article on Dekeloil in Mail - should help raise awareness of one of AIM success stories!

[cheshire man] 09/4/2017 08:09

Beat me to it rivaldo :-)

[hastings] 09/4/2017 08:03

Thanks for posting rivaldo. No doubt a very good start tomorrow morning which will hopefully set the trend for the rest of the week and beyond.

[rivaldo] 09/4/2017 07:01

Tipped in today's Mail on Sunday, so should get a well-deserved boost - with the Q1 figures this week also promising to be very good:



"MIDAS UPDATE: Golden palms... Palm oil producer offers healthy future for investors as well as Orang-utans

By Holly Black, Investment Reporter For The Daily Mail

Published: 23:02, 8 April 2017 | Updated: 23:02, 8 April 2017

Palm oil has a dreadful reputation, with its production often devastating rain forests and threatening the habitat of orang-utans.

DekelOil aims to be different. Most criticism is levelled at producers in Indonesia and Malaysia, where orang-utans live. Dekel operates in West Africa’s Ivory Coast.

And many plantation owners are accused of mistreating local farmers. Dekel works with them to improve living standards.

Midas last looked at the company in December 2015, when the shares were 1.175p. In June 2016, a one-for-ten share consolidation programme was launched. Shareholders received one new share in place of every ten held.

Had that been in place in 2015, the price would have been 11.75p. Today it is 7.5 per cent higher at 12.65p.

The price has yo-yoed recently but the future bodes well for both the firm and its shareholders. Last year was tough for the sector.

The price of crude palm oil was at its lowest in more than a decade, and Nigeria’s currency plunged, cutting demand for imports. This hit Dekel, as it sells most of its oil in West Africa.

By contrast, 2017 has begun on a much brighter note for the industry, and Dekel has undertaken a number of measures to strengthen its business and boost production.

Last year, despite tough circumstances, Dekel’s sales rose by 12 per cent to just over €12 million (£10 million). The company reports in euros because the Ivory Coast’s currency is pegged to the euro.

The firm also raised production by 9 per cent to 39,000 tons and should deliver even higher production increases this year. Analysts forecast production will hit 45,000 tons in 2017, rising again in 2018.

Higher prices and higher production bode well. In 2016, the average palm oil price was €565 a ton. Today, it’s nearer €718 a ton and is expected to remain above €700 a ton at least until the end of the year.

The firm underwent a financial restructuring last year – buying out a minority partner, refinancing bank debt on better terms and paying a maiden dividend. The exercise simplified finances and encouraged big investors.

Dekel is expected to release first quarter production and revenue figures this week, and these should make for encouraging reading. Profit for 2016 will be revealed in late April or early May, and analysts expect €2.6 million with a 0.17p dividend.

In 2017, profits are expected to soar to €6.5 million, boosted by increased production and higher prices. Further strong growth is pencilled in for 2018 too, with rising dividend payments.

Dekel is run differently from most palm oil producers. Less than 10 per cent of its output comes from its own estate. The rest comes from local smallholders. It owns a nursery, where it grows palm seedlings.

Small trees are then sold to local farmers to plant and nurture. They then sell the bunches of fruit back to Dekel, which turns them into crude palm oil in a modern mill.

This provides a secure livelihood for thousands of smallholders, and Dekel has furnished the local village with a school, medical centre and fresh water.

The project even caught the attention of the World Bank, which now subsidises smallholders to buy seedlings from Dekel, boosting production.

Dekel’s mill has the capacity to produce more than 65,000 tons of oil a year, and there is room for growth on the current plantation. But boss Lincoln Moore is ambitious, and plans a second plantation, again near the economic capital Abidjan, and a third in Ghana.

Palm oil is a basic cooking oil in West Africa and elsewhere. But it is also used in foods, from mayonnaise to biscuits, as well as in soap, lipstick and cleaning products.

Demand in Dekel’s core market of West Africa is growing as living standards rise. Ivory Coast’s economy alone is growing at 9 per cent a year, boosting local appetite.

Midas verdict: Agricultural firms are never risk-free and palm oil prices can be volatile. But Dekel has a sound business plan and payment of a dividend highlights confidence in the future. Existing investors should hold. Adventurous punters should pick up a few shares at 12.625p."

[empirestate] 07/4/2017 16:08

Hopefully at long last the seller could be out. She rarely makes this size of move in almost one go. Just need a few more buyers to see if she pushes on to indicate

[rivaldo] 07/4/2017 16:04

Yep :o))

250,000 just reported through at 12p. Not sure if it's a buy or a clearance of an overhang. Either way it seems to have set something off (unless there are more trades still to be reported).

[rivaldo] 04/4/2017 13:40

Cheers here and there, excellent summary.

DKL looks ludicrously undervalued on a current year P/E of 6.3 - and with a dividend - assuming no hiccups in harvesting, shipping etc.

The imminent 2016 results should be good given the last update, and the Q1 trading outlook should be terrific given the very high CPO prices in that period. So we should be in for a period of sustained positive news flow (subject to the usual food industry producer caveats).

[here and there] 04/4/2017 12:53

Independent tip

Dowgate Capital – April Stock Picks
Page | 3
NEW SMALL CAP IDEAS DekelOil
Price: 11.9p
Market Cap: £35.5m
Ticker: DKL.L
Market: AIM
Sector: Food Producers
We anticipate DekelOil will shortly issue a quarterly production and sales update from its expanding and profit generating palm oil operations in Côte d’Ivoire, West Africa. With current Crude Palm Oil (CPO) sales prices being much stronger than at this stage last year we would expect to see material sales revenue growth compared to Q1 2016. The FY results to 31 December are also expected to be announced in the next 6-8 weeks. This will hopefully provide confirmation of DekelOil joining that small and exclusive AIM club of yielding shares with the payment of a maiden dividend. Management highlighted recently (Feb ’17) that FY16 results are “anticipated to increase materially compared to FY15 revenue of €23m and EBITDA of €3.1m.”
DekelOil is a vertically integrated palm oil producer, owning a production mill that enables independent smallholders to process their harvested produce (Fresh Fruit Bunches) into crude palm oil, along with plantation land developed by the Group itself that is now reaching maturity.
House Broker Cantor Fitzgerald estimate a dividend of 0.17p (0.2c) per share for ’16 FY, which equates to a 1.4% yield at the current mid-market price, which would be covered by x5, based upon an eps forecast of 0.85p (1.0c) for ’16. Ahead a progressive dividend policy is envisaged, with the Group benefiting from an extremely favourable 13-year corporate tax holiday in Côte d’Ivoire. The PE ratings looks very undemanding for a Group still in a growth phase, at an estimated x14.0 for ’16, dropping to x6.3 for ’17 using Cantor Fitzgerald’s projections.
The market background remains strong, with CPO prices up by around 20% over the last 12-months and near 3-year highs. Further out in the mid to long term, there is the prospect of DekelOil attracting takeover interest and thereby going a similar route to that taken by MP Evans and New Britain Palm Oil in recent years. We recommend DekelOil as our dual AIM growth and yield play.

[rivaldo] 31/3/2017 12:14

IMO it's just a seller or two who's been there for ages. With many stocks a re-rating following the removal of a seller can be very quick indeed.

The chart is actually still on a nice long-term rising trend. CPO prices have dipped to $705 now, but that's still above the level for most of H1'16, and with much larger production of course.

[empirestate] 30/3/2017 14:15

not much confidence being shown in finals or Q1's considering the pre-selling, doesn't bode too well by any stretch.

[here and there] 24/3/2017 18:45

this is building nicely, chart looks awesome for a move to 14p plus.

news flow to come…..Q1 production report due in about 2 weeks…….last year it was sensational, anything near last years combined with CPO prices 40% higher than last year and this stock will fly

[chadders] 24/3/2017 15:49

Not long for finals. Mid April last year so I'm expecting something similar this time. Anybody know dates?

[rivaldo] 20/3/2017 12:30

:o))

Yep, reports late last week of improved demand. Even at $720 the price was well above most of H1'16, and now the price is back up to $780.

[cyfran101] 18/3/2017 19:29

Helps when the CPO price jumps 10%!

[mach100] 17/3/2017 22:40

Nice buying pressure today and a tilt at 13p. Can we break through this important resistance. Lots of sales too without much damage being done. Building nicely for a move up!

[empirestate] 17/3/2017 10:09

good to see the price hold up on those 4 sale trades, usually the share price would have sunk, evidently there appears to be support for the bid.

[bad gateway] 17/3/2017 09:02

Up a tick on a couple of small buys, maybe that was the persistent seller done? Would be good to see the stock given a chance to rise pre finals as that 23-29p target above gives chance for some decent profit from here.

[rivaldo] 17/3/2017 08:45

Good to see a 30k buy cause a nice positive turnaround this morning.

Worth noting the current forecasts:

last year : 0.88p EPS, 0.18p dividend
this year : 1.94p EPS, 0.19p dividend

[empirestate] 16/3/2017 20:15

Looks like that 880K share sale is part of the persistent seller stock delayed reporting.

[cheshire man] 16/3/2017 12:46

23---29p target price on these, could see a nice run up to finals :-)