16th Jan 2023 12:52
(Alliance News) - MP Evans Group PLC on Monday said 2022 crop and production tonnes were up again, while it predicted further growth is still to come.
The sustainable Indonesian palm oil producer said production of its own crop of fresh fruit brunches were up 12% to 905,400 tonnes in 2022 from 809,700 tonnes in 2021, scheme-smallholder crops were up 16% to 265,700 tonnes from 229,300 tonnes, while independent crops purchases were up 4% to 340,600 tonnes from 327, 200.
This lead to a 2022 total of over 1.5 million tonnes in crop of fresh fruit bunches, up 11% from under 1.4 million tonnes in 2021.
Production of crude palm oil was also up 9% to 341,700 tonnes from 312,900 tonnes, while palm kernels were up 10% to 73,800 tonnes from 67,100 tonnes.
MP Evans said the improved production performance was due to its oil-palm estates continuing to mature and yields rising, alongside management in Indonesia "striv[ing] for operational excellence" in both estate and milling operations.
It expects further product growth still to come, even after another year of increase.
During 2022, MP Evans achieved an average mill-gate price for its crude palm oil of USD854 per tonne, up 5% from USD810 a year earlier, while prices for palm kernels averaged up 15% to USD611 per tonne from USD533.
It said crude palm out pricing "moderated somewhat" in the second half of 2022 from the very high levels earlier in the year. Moving into early 2023, it forecasts recently achieved mill-gate prices falling to around USD750 per tonne, "which remained strong compared to historic levels", it claimed.
MP Evans is close to completing its sixth palm-oil mill at its Musi Rawas project in South Sumatra, Indonesia, which will process the increasing amount of crop being harvested from that estate.
It reported it received total sustainability premiums of around USD7.5 million related to the sale of its certified sustainable output, up 74% than the USD4.3 million received in 2021.
This reflected a strong increase in premiums available for sustainably-produced palm kernels, it explained.
"The group has achieved another significant increase in crop processed which, in conjunction with the high price environment in the year, will form the basis for an excellent result," said Executive Chair Peter Hadsley-Chaplin.
"We anticipate further crop increases from the group's first-class estates and, with the Musi Rawas mill soon to be commissioned, we look forward to another productive and successful year in 2023."
MP Evans said the board remains committed to its policy of holding or increasing its dividend, considering its reported crow growth, strong crude palm oil pricing environment and ongoing cash generation.
It eliminated the remaining net debt of USD5.4 million at the end of 2022 from the start of the year. Net cash finished for the year at over USD30 million.
Shares in MP Evans were up 4.9% to 860.00 pence each in London on Monday afternoon.
By Greg Rosenvinge, Alliance News reporter
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