Landkom Share Discussion Threads

[kimboy2] 07/9/2011 13:59

Edisnon were forecasting 38.74kt. They are saying they harvested 26.225kt. At $570 this is $7.1m

[qvg] 07/9/2011 13:47

Martin / Shanklin
re HL. thanks for that. I had a stop loss with TD Waterhouse, whose execution was pretty unimpressive.
re your assessment. I agree with both points. my mistake was to attribute the drop in price to general market conditions. they have a large loan which presumably relied on the success of this crop to repay. their cash situation looks very difficult - any buyer can play very hardball. can't see any upside here

[hightech] 07/9/2011 13:43

The difference between the most optimistic estimate and the current fact is about $10M turnover, of which $5M could be profit. That's certainly important but it is not as bad as some of you are projecting, IMO,

[shanklin] 07/9/2011 13:31

I think the issues here are two-fold:

- I strongly suspect the rapeseed crop outcome has been known to insiders for an extended period and that situation has been traded on to the detriment of other shareholders

- LKI are signalling they have insufficient cash to continue to operate as had been planned. Somebody is going to exercise a high price for providing this cash whether its in the form of a loan or a placing.

[shanklin] 07/9/2011 13:27

qvg

It was an online quote with Hargreaves Lansdown between 08:00 and 08:02.

Normally, in this type of situation, I would try and deal pre-market but HL refused to do so which quite surprised me as this used to be a service they offered.

So, I was on the phone with HL at 08:00 trying to get a quote from a human MM. Whilst waiting for a quote that way I tried to get an online quote not expecting one at all. When 4.11p came up online I asked the HL dealer to stop what he was he doing and, after he had, I accepted the 4.11p.

Not my finest hour and it was only 75k shares but less bad than it might have been.

Cheers, Martin

P.S. I general I think HL are fairly useless at obtaining competitive prices but on this occasion I was pleased with the outcome.

[darcon] 07/9/2011 13:11

Perhaps he is factoring lower yields into his figures for other crops that are yet to be harvested

[hightech] 07/9/2011 13:02

Rivaldo, The difference between the estimate and reality is around 16000 MT, at current price, the change in turnover would be less than $10m, profit change is certainly much lower than this.

How Mr. Ben Jaglom came up with $14.5M difference in profit when turnover difference in less than $10M? Old age maybe!

[rivaldo] 07/9/2011 12:52

From GCI - "stay clear for now":



"Landkom harvest damaged by rain
07/09/2011 Ben Jaglom

Amidst heavy rainfall Ukrainian farming concern Landkom International (LKI) has described its latest rapeseed harvest as 'disappointing'.

The AIM-quoted venture harvested 26,225 tonnes of rapeseed with an average yield per hectare of 1.75 tonnes, well below the 43,000 tonnes at 2.6 tonnes a hectare forecast by its broker Liberum. As a result the company is now expected to produce a full year loss of $6.9 million as opposed to the $7.7 million profit forecast by Liberum.

The company declared that the average yield was 'below the board's expectations' due to factors including 'earlier hail damage and heavy rains during harvest.' It added that the 'financial implications' of the lower than expected rapeseed harvest are being 'assessed' with the board remarking that it is 'now reviewing the group's strategic options.' Landkom has a contractual obligation to supply 30,000 tonnes of rapeseed and notes that there will be a shortfall to cover but adds that it 'does not anticipate any problem with purchasing the amount of rapeseed required to meet its contractual commitments.'

Following the announcement analysts at Liberum downgraded their forecast for the year to October 2011 from a profit to a loss of $6.9 million on sales downgraded from $50 million to $39.4 million. A forecast for cash of $5.2 million was downgraded to net debt of $5.3 million.

Last recommended by Growth Company Investor at 6.63p this July we remarked that Ukraine's recent heavy rains 'may affect the harvest.' They have certainly done so and the company looks to be in a precipitous situation. We would advise those not invested to stay clear for now until the company provides further details of its future plans."

[qvg] 07/9/2011 12:50

shanklin, your broker did better than mine to get you out at 4.11. mind if I ask who you use?

tim000, that's your credibility gone!

[divinausa1] 07/9/2011 12:47

fritz1930 - 7 Sep'11 - 11:32 - 2031 of 2036

Well chaps, there you are, that is farming all over again. Never to order the music before the money is safely in the bank. Grandpa back home on the farm knew it all the time !!! All that's left now is to hope for better times, next year !
==========

fritz its just 1 harvest, its bad luck re the weather
anyway you look at it at present market cap this is VERY cheap
thats why i have topped up this am, and will buy more at some point
At some point the Chinese will be in Ukraine. Watch this space.

[hightech] 07/9/2011 12:42

anyone level 2?

[hightech] 07/9/2011 12:15

They have to buy around 2300 MT to cover the contract.

[ukinvestor220] 07/9/2011 12:09

They are going to have to buy produce to fulfill their contracts!

"As previously announced, the Group has contracted to supply 30,000 tonnes of rapeseed to buyers. While these agreements provide for Landkom to vary the amount by up to 5 per cent. on average, there will be a shortfall to cover.

The Group does not anticipate any problem with purchasing the amount of rapeseed required to meet its contractual commitments, at a favourable price. "

[darcon] 07/9/2011 11:37

Are rapeseed prices now below what they forward sold at? Or is the shortfall (between what was forward sold and ultimately harvested) that they have to fill also going to produce some trading losses?

[giant steps] 07/9/2011 11:32

"Business Sale" is an interesting upside

LKI reminder mcap £14.1m (@3.25p), certainly looks the cheapest out there

[fritz1930] 07/9/2011 11:32

Well chaps, there you are, that is farming all over again. Never to order the music before the money is safely in the bank. Grandpa back home on the farm knew it all the time !!! All that's left now is to hope for better times, next year !

[kimboy2] 07/9/2011 11:26

Well when they talk about strategic reviews I always assume that this means selling is a possibility.

One crew that would be interested is Mriya;



The are quoted in Frankfurt and have been buying very aggressively over the last few years. They presently have 240k ha. It started with 50ha in 1992.

The present mkt cap is E584m which makes their 240k/ha vlued at E2,430/ha.

The current value of LKI is £208/ha.

That is the gap I would like to see them close.

[giant steps] 07/9/2011 11:18

"The Board has also begun a review of the business to
consider a broad range of strategic alternatives."

More planting of rapeseed looks a brave call imo.


Does this translate to "funding" or "for sale" ? (time will tell)

[loganair] 07/9/2011 11:06

LKI have first refusal on any of their leased land when and if it comes up for sale. Mind you they don't have the spare cash to buy as any spare cash will be needed to increase their acreage under crop as LKI are or were hoping to increase 2012 planted area by between 3,000h and 5,000h and a further 3,000h to 5,000h in 2013.

Like many I'm shocked at how low the rapeseed harvest came out at and as I posted a couple of days ago is LKI's most important crop.

[giant steps] 07/9/2011 10:51

Kimboy2, perhaps they will tap the market to "fill the gap"


edit : or trade sale

[schrodingers_cat] 07/9/2011 10:50

yes strategic value not impacted by one years results IMO

[kimboy2] 07/9/2011 10:48

They own leases.

[shanklin] 07/9/2011 10:47

LKI don't own any land do they?

[kimboy2] 07/9/2011 10:26

Wouldn't surprise me if there is a bid now. There are plenty of people looking for Ukraine land.

[divinausa1] 07/9/2011 09:12

shareprice is at the lowest its ever been, the results were bad but compensated by higher prices. im happy to build a position here from interims.. OK no profit but does it warrnet 30% drop in share price i dont think so...

Highlights

· Revenues increase to $7.97m (2010: $1.93m), reflecting 2010 harvest

· Pretax profit of $1.11m (2010: loss $4.32m)

· Earnings per share of 0.3 cents (2010: loss 1.1 cents)

· Group on target to achieve a pretax profit for the full year

· Turnaround and efficiency programme continued

· 52,000 hectares planted in 2010/11 programme - up 30% on 2009/10

· 5,000 tonnes of rapeseed sold forward at $600 per tonne - up 78% on 2010 forward sales

Post period end:

· Harvest underway

· Further forward sales agreements signed for 25,000 tonnes of rapeseed at $600 per tonne

- Around 75% of 2011 rapeseed crop now forward sold