A 23 per cent slide the in average palm oil price to $846 (£535) a tonne, largely explains the full-year earnings fall at MP Evans (MPE). But management is, at least, upbeat about production prospects at its majority-owned Indonesian estates.
Indeed, output has improved as the Kalimantan and Bangka estates have matured - production of palm-oil fresh fruit bunches (FFB) from these estates rose by 98 per cent and 11 per cent, respectively, to 51,900 tonnes and 16,200 tonnes. Moreover, management expects to produce 350,000 tonnes of FFB from its majority-owned plantations for the current year, compared with 317,000 tonnes in 2012, rising to 500,000 tonnes in 2015. Extraction rates have continued to improve at the Kalimantan and Sumatra mills, while initial planting at the Musi Rawas acreage in South Sumatra should commence next year, although output from associates' estates did fall 3 per cent.
MP Evans has had to contend with rising wage costs - but this has been partly offset by a fall in the Indonesian rupiah against the dollar; a factor that could conceivably add to fuel and fertilizer costs. Meanwhile, the group's stake in Australian beef cattle business NAPCo generated a $1.2m loss - unchanged on last year.
Broker Peel Hunt expects full-year pre-tax profit of $35.8m, giving EPS of 52.6 ¢ (from $24.7m and 31¢ in 2012).
| MP EVANS (MPE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 490p | MARKET VALUE: | £269m | |
| TOUCH: | 486-500p | 12-MONTH HIGH: | 545p | Low: 470p |
| DIVIDEND YIELD: | 1.6% | PE RATIO: | 31 | |
| NET ASSET VALUE: | 630¢ | NET DEBT: | 3% | |
| Half-year to 30 June | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 38.6 | 11.0 | 23.9 | 2.25 |
| 2013 | 38.4 | 8.60 | 16.2 | 2.25 |
| % change | -1 | -22 | -32 | - |
Ex-div: 25 Sep Payment: 4 Nov £1=$1.58 | ||||
