For Anglo-Eastern Plantations (AEP), higher palm oil prices are a good thing. The company owns, operates and develops plantations that produce mainly palm oil in Indonesia and Malaysia. The price it can fetch depends on a number of fluctuating factors, including supply versus demand, weather patterns that affect the crops, and prices of competing vegetable oils.
An 11 per cent increase in the price of palm oil to $740 (£572) per metric tonne (mt) provided a boost to profits at the half-year, as did the 15 per cent increase in production of fresh fruit bunches to 436,900mt following recovery at the Riau and Kalimantan plantations after the El Nino storm.
Anglo-Eastern grows its own fruits and also buys external crops to maximise the utilisation of its mills. Over the period 486,300mt of crops were bought, an 84 per cent increase on the same period last year, and the company’s six mills processed 45 per cent more fresh fruit bunches than the previous year at 912,200mt. A higher proportion of bought-in crops along with higher palm oil prices pushed gross profit margins up from 22 per cent to 24 per cent.
| ANGLO-EASTERN PLANTATIONS (AEP) | ||||
| ORD PRICE: | 816p | MARKET VALUE: | £323m | |
| TOUCH: | 816-819p | 12-MONTH HIGH: | 888p | LOW: 444p |
| DIVIDEND YIELD: | 0.3% | PE RATIO: | 9 | |
| NET ASSET VALUE: | 966¢ | NET CASH: | $91.8m | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
| 2016 | 86.0 | 17.3 | 20.3 | nil |
| 2017 | 147 | 31.6 | 46.0 | nil |
| % change | +71 | +83 | +127 | - |
| Ex-div: | na | |||
| Payment: | na | |||
| £1=$1.29 | ||||
