REG - M. P. Evans Group - Trading Statement

M P EvansAnnouncement

14/06/2024 07:00

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RNS Number : 4000S  M. P. Evans Group PLC  14 June 2024

 M.P. EVANS GROUP PLC

("Group" or "M.P. Evans")

ANNUAL GENERAL MEETING

The annual general meeting of M.P. Evans Group PLC, a producer of sustainable
Indonesian palm oil, will be held at 12pm in London today. Further details
on the AGM, including a link to the live AGM webcast, can be found on the
Group's website at www.mpevans.co.uk/investors/agm
(http://www.mpevans.co.uk/investors/agm) . The following statement is an
update on trading conditions and progress on the Group's activities since the
publication of the annual report in March.

Crops

The total crop of fresh fruit bunches ("ffb") processed by the Group in the
five months to 31 May 2024 was 631,400 tonnes, 8% higher than the 584,400
tonnes processed in the same period in 2023. The Group experienced rapid
growth in crop in the early part of the year and, whilst this has abated to
some degree in recent months, management are pleased to report year-to-date
growth from all sources of crop. Crops by source were as follows: from
majority-owned areas 360,700 tonnes (2023 - 329,000 tonnes), associated scheme
smallholders 107,300 tonnes (2023 - 101,200 tonnes) and independent suppliers
163,400 tonnes (2023 - 154,600 tonnes). Crop increases have been supported by
the areas acquired by the Group in 2023 and, whilst yield from these estates
remains relatively low, significant progress is being made to improve
agronomic standards. This bodes well for future crop growth.

Production

The Group produced the equivalent of 147,500 tonnes of crude palm oil ("CPO")
during the first five months of 2024, an increase of 10% on the 134,400 tonnes
produced in the same period in 2023. As a result of operating six palm-oil
mills throughout the period, 96% of that CPO came from the Group's own
production facilities, with the remainder from outside mills. The Group's
engineering team has worked hard to continue delivering robust extraction
rates across all mills, and the average oil-extraction rate in Group mills for
the first five months was 23.4%, higher than the 23.0% achieved in the same
period of 2023.

Sales and prices

The average price of CPO (cif Rotterdam) for the first five months of the
year was US$997 per tonne, very similar to the US$1,001 per tonne during the
equivalent period in 2023. During this period, the Group realised an average
price at mill gate of US$770 per tonne compared with US$779 per tonne in
2023, a 1% difference. Prices for palm kernels have been improving from a low
level at the start of the year and, by the end of May, year-to-date pricing
had exceeded the previous year's average at US$425 per tonne (2023 US$415 per
tonne).

Acquisition

The Group recently announced the acquisition of the 5% minority holding in
most of its Indonesian subsidiary trading companies. The total purchase cost
was US$14.0 million, based on an agreed price of US$9,000 per planted hectare,
and resulted in an increase in the Group's effective ownership of high-quality
plantation land by over 1,700 hectares. The acquisition is in line with the
Group's growth strategy and will be immediately earnings enhancing for
shareholders.

Sustainability

The Group is a long-standing member of the Roundtable on Sustainable Palm Oil
("RSPO"). The majority, and increasing proportion, of its output is certified
as sustainable production and, from early 2024 onwards, all Group mills are
accredited to sell certified sustainable palm oil. With the benefit of having
two mills at Kota Bangun, in early 2024 the Group took the additional step of
obtaining certification for its Bumi Permai mill at Kota Bangun as a supplier
of segregated, or 'identity preserved', CPO, with all crop fully traceable to
areas managed by the Group.

Strategy

The Group has four key strategic pillars: it is a responsible producer of
sustainable Indonesian palm oil, striving for excellence in all its
operations, with a focus on continuing growth and offering an increasing
yield.

Acting responsibly is at the heart of everything the Group does. The Group
does not deforest and acts as a good steward of the land it cultivates. It
invests for the long term, in its employees, their training and in the
facilities it provides for them. This approach fosters a culture of
excellence, enabling the consistent delivery of high crop yields and
extraction rates. In turn, the long-term investment, the age profile of the
Group's planted areas and the yields achieved support continuing growth, and
the opportunity to increase shareholder returns.

An increased total dividend of 45p per share has been proposed in respect of
2023, and it remains the board's intention to continue the Group's long-term
trend to increase, or least maintain, dividends for shareholders.

 

14 June 2024

 

Enquiries:

 M.P. Evans Group PLC  Telephone: +44 (0) 1892 516333

Peter Hadsley-Chaplin, chairman
Matthew Coulson, chief executive

Luke Shaw, chief financial officer

 

 Cavendish Capital Markets (Nomad and broker)  Telephone: +44 (0) 20 7220 0500

Matt Goode, George Lawson (Corporate Finance)

Tim Redfern, Harriet Ward (ECM)

 

 Hudson Sandler (Financial PR)  Telephone: +44 (0) 20 7796 4133

Charlie Jack, Charlotte Cobb, Francis Kerrigan

 

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