The end of the particularly rainy El Niño weather experienced in Southeast Asia during 2015 and 2016 has now quite literally started to bear fruit for MP Evans (MPE), with crops ahead of last year by more than a quarter to 213,800 tonnes. The company produced 56 per cent more crude palm oil (CPO) at 70,500 tonnes and 60 per cent more palm kernels at 14,700 tonnes. Higher volumes helped spread costs, pushing the cost per tonne of crude palm product (including the oil and kernels) down to $380, compared with $445 last year. Meanwhile, palm oil prices rose by a tenth to $735 per tonne.
Increased production and higher prices meant costs as a proportion of revenues fell, helping gross profit margins widen to 30 per cent from 17 per cent last year. But it's worth pointing out that total profits for the period also included a one-off $68m gain from the sale of its Agro Muko joint venture. The plantation is to be replaced by the recent acquisition of an additional 10,000 hectares in Kalimantan for $108m.
Analysts at Peel Hunt expect pre-tax profits of $33.6m in the year to December 2017, with an EPS of 33.5¢ (from $24m and 22.3¢ in 2016).
| MP EVANS (MPE) | ||||
| ORD PRICE: | 740p | MARKET VALUE: | £403m | |
| TOUCH: | 740-744p | 12-MONTH HIGH: | 781p | LOW: 405p |
| DIVIDEND YIELD: | 2.4%* | PE RATIO: | 26 | |
| NET ASSET VALUE: | 699¢ | NET CASH: | $129m | |
| Half-year to 30 June | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
| 2016 (restated) | 30.4 | 4.8 | 4.1 | 2.25 |
| 2017 | 57.5 | 18.0 | 20.8 | 5.00 |
| % change | +89 | +279 | +407 | +122 |
| Ex-div: | 19 Oct | |||
| Payment: | 03 Nov | |||
| *Excludes special dividend worth 10p a share in relation to the Agro Muko sale £1=$1.36 | ||||
