Falling palm oil prices and losses at the cattle operation help explain the half-year profit slide at palm oil producer and cattle specialist, MP Evans. A $1.1m (£0.68m) exchange rate-related hit and a three-fold hike in administrative expenses didn't help, either.
Crops of oil-palm fresh fruit bunches (ffb) actually rose 22 per cent to 138,100 tonnes in the six-month period and, as the planted estate matures, production is expected to reach 500,000 tonnes of ffb by 2015, double last year's production. But expectations of increasing output in Indonesia and Malaysia pushed the palm oil price down to $950 per tonne by the end of June - compared with an average of $1,195 a tonne in 2011's first half. Still, gross profit from the plantations did rise 14.6 per cent from $13m to $14.9m.
Meanwhile, a strong Australian dollar and weakening demand from Japan and Korea have hit Australian beef prices. That forced a writedown on the value of cattle herd at 34.4 per cent-owned Australian cattle operation, NAPCo - which turned a $2.9m first-half profit last year into a $1.2m loss.
Broker Peel Hunt expects flat full-year adjusted pre-tax profit of $41.7m and EPS of 56.1¢, based on full-year output of 300,000 tonnes of ffb.
MP EVANS (MPE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 530p | MARKET VALUE: | £290m | |
| TOUCH: | 525-535p | 12-MONTH HIGH: | 560p | LOW: 380p |
| DIVIDEND YIELD: | 1.5% | PE RATIO: | 16 | |
| NET ASSET VALUE: | 633¢ | NET DEBT: | 0.5% | |
| Half-year to 30 Jun | Turnover ($m) | Pretax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 28.2 | 14.5 | 37.2 | 2.25 |
| 2012 | 38.6 | 11.0 | 23.9 | 2.25 |
| % change | +37 | -24 | -36 | - |
Ex-div: 26 Sep Payment: 5 Nov £1=$1.62 | ||||
