Half Yearly Report

15th Jan 2009 15:38



Cambium Global Timberland Limited

Unaudited Condensed Interim Financial Statements

For the 6 months to 31 October 2008

Chairman's Statement

Dear Fellow Shareholders,

 

I am pleased to present the unaudited interim results for Cambium Global Timberland Limited (the "Company") for the six months ended 31st October 2008.

These results cover a period of very significant difficulty in financial markets, which has resulted in unprecedented turmoil in the pricing of many financial assets. The Company's operations are characterised by several features, which have tended to mitigate the worst effects of this turmoil. In particular, the Company does not and has not employed leverage either at the corporate level or at the level of the special purpose entities through which our timberland assets are owned. In addition, the timberland asset class has tended to display lower levels of volatility than has been the case for other asset classes. Where the company has not been unaffected is in the market wide increase in discounts to net asset value applied to closed end listed investment companies.

Over the period covered by the interim accounts the net asset value has been relatively stable and the performance reports on the Company's various timberland properties have been encouraging but the share price has suffered a notable reduction. The Board and its advisers are monitoring the situation carefully and consideration is being given to the pragmatic use of buy back powers subject to the prior development claims of the investment portfolio for cash and the dividend objectives of the Company as set out in the prospectus.

Shareholders should also note that the accounting treatment of the foreign exchange hedging activities, which are undertaken to reduce foreign exchange risk has resulted in a substantial deficit appearing in the Consolidated Income Statements. This is balanced by the appropriate entry detailing the gain on loan revaluations in the Statement of Equity. The Board views the net asset value progression as being a more accurate and meaningful method of assessing the performance of the Company.

The Company is now approaching a fully invested position with a portfolio of quality timberland assets diversified by geography, by species, by stage of development and by end user markets. Each property is being managed according to a plan set out at the time of its acquisition and subsequently amended as appropriate by Cogent in consultation with the underlying timber managers. Whilst it would be naive to expect timber markets to be completely unaffected by global economic developments, the evidence available to us suggests that the characteristics of lower volatility and long term returns compared with other asset classes identified at the time of the Company's launch remain valid.

The Board and the Managers are optimistic that timberland is and will remain an attractive asset class and the Company is well positioned to provide investors with access to this opportunity. 

Donald Adamson

Chairman 

15 January 2009

Investment Manager's Statement

CP Cogent Asset Management LP is pleased with the performance and quality of the current investments and with the properties that are in the acquisition pipeline. At this point Cambium Global Timberland Limited (the "Company" or "Cambium") is approaching full investment. The Company has acquired eight timberland properties and remains focused on wisely deploying the remaining uncommitted capital. 

Cambium acquired two properties during the six-month period ending 31 October 2008, and has acquired one additional property since 31 October (as at 31 December) which is not included in these accounts. The three most recent acquisitions are highlighted below.

The Company acquired two properties for the Minas Gerais charcoal strategy in July and November of 2008. The properties consist of 2,500 and 19,000 acres, respectively. The acquisition and committed plantation establishment investment funds total about £10 million. These greenfield eucalyptus properties are projected to produce timber cash flows in seven years as harvested wood is sold into established charcoal markets. 

The 3R property was acquired in October 2008 and consists of 25,700 acres located in northern Brazil. The acquisition and committed plantation establishment funds are valued at about £9M. The Greenfield eucalyptus project is being developed on land previously used for grazing and is in a region with multiple end use markets.

Additionally, we continue to make progress executing our plan on the existing investments.

As of December we have completed the planting of approximately 1,500 acres on the Tarrangower property in New South Wales Australia. The property has received plentiful rainfall which has provided ideal conditions for planting. 

In Hawaii, we continue to review the possibility of bio-mass feed stock markets that are in the development phase. The state of Hawaii continues to look for possible solutions to lower the cost of power generation and there are multiple parties working towards the development of bio-mass fired power generation facilities. Cambium's eucalyptus plantations are located strategically to these proposed facilities should they become reality and would offer enhanced returns to our existing export log strategy.

Due to the downturn in the US housing markets, pine sawtimber prices are weak at this time. Timber harvest from the southern U.S. properties in Cambium's portfolio has been curtailed as we are allowing these forests to continue to grow biologically as markets recover. We continue to receive hunting and recreational lease income from these properties.

Our financial results for the first six months of the year mirror our operations. Revenue for the period was low, as a result of the reduced timber harvests. However the appraised value of the properties increased largely as a result of biological growth. Increased land values and an ability to make a recent acquisition at below-appraised value also led to the NAV increase. We will expect to capture these gains in cash flow in future periods as timber markets improve and as we sell non-strategic land. 

Environmental markets continued to develop during the period. This is particularly true in Australia, where the carbon pollution reduction scheme is set to be implemented in 2010. This scheme includes a mandatory cap and trade system and the government proposes to include forestry on an "opt-in" basis. The Australian Government proposes that forestry activities that are in line with Kyoto Protocol rules will be eligible to participate in the scheme. 

We continue to review quality acquisition opportunities and look forward to updating you on the further development of the portfolio in future reports.

CP Cogent Asset Management, LP

15th January 2009

Cambium Global Timberland Limited
Condensed Consolidated Interim Income Statement
for the period ended 31 October 2008
					For the period from		For the period from
					1 May 2008 to		19 January 2007 to
					31 October 2008		31 October 2007
				Notes	£		£
Revenue					315,362		322,219
Cost of sales					(287,833)		(283,078)
Gross profit					27,529		39,141
Increase in fair value of land and plantations					7,339,640		2,462,172
Corporate Administration Expenses					(1,112,454)		(1,327,607)
Forestry Operating Expenses					(501,061)		(434)
Establishment expenses					-		(3,391,375)
					(1,613,515)		(4,719,416)
Operating profit/(loss)					5,753,654		(2,218,103)
Finance income					1,545,113		3,359,762
Finance costs					-		(2,567)
Net finance income					1,545,113		3,357,195
Net foreign exchange (loss)/gain				13	(10,973,982)		489,686
Loss/(profit) before taxation					(3,675,215)		1,628,778
Taxation					(2,599,854)		-
Loss/(profit) for the period attributable to shareholders					(6,275,069)		1,628,778
Basic and diluted (loss)/earnings per share				4	(6.01) pence		1.56 pence

Cambium Global Timberland Limited
Condensed Consolidated Interim Balance Sheet
At 31 October 2008
						At 31 October 2008		At 30 April 2008		At 31 October 2007
				Notes		£		£		£
Non-current assets
Plantations				7		72,849,730		23,807,920		22,078,126
Property, plant and equipment				8		430,111		461,120		402,546
Intangible assets				9		107,071		123,164		115,535
Deferred tax assets						95,874		630,005		-
						73,482,786		25,022,209		22,596,207
Current assets
Trade and other receivables				10		276,378		774,630		477,629
Available-for-sale investments				12		11,038,500		8,964,000		8,908,900
Deferred tax assets						4,568		-		-
Forward exchange currency contracts				13		-		43,106		22,563,863
Cash and cash equivalents				14		39,700,069		73,757,639		73,348,802
						51,019,515		83,539,375		105,299,194
Total assets						124,502,301		108,561,584		127,895,401
Current liabilities
Bank Overdraft						-		-		120
Trade and other payables				15		2,114,535		471,674		357,751
Deferred tax liabilities						3,986		-		-
Forward exchange currency contracts				13		10,930,877		-		21,519,144
						13,049,398		471,674		21,877,015
Non-current liabilities
Deferred tax liabilities						4,607,887		1,920,265		-
Other liabilities				16		281,754		-		-
						4,889,641		1,920,265		-
Total liabilities						17,939,039		2,391,939		21,877,015
Net assets						106,563,262		106,169,645		106,018,386
Equity
Stated capital				17		2,000,000		2,000,000		2,000,000
Distributable reserve						102,350,000		102,350,000		102,350,000
Revaluation reserve						133,592		52,292		45,958
Translation reserve						10,213,213		495,708		(6,350)
Retained loss/earnings						(8,133,543)		1,271,645		1,628,778
Total equity						106,563,262		106,169,645		106,018,386
These financial statements were approved and authorised for issue on 15 January 2009 by the Board of Directors.
Director						Director
The notes on pages 12 to 20 form an integral part of these interim financial statements.

 

Cambium Global Timberland Limited
Condensed Consolidated Interim Statement of Changes in Equity
For the period ended 31 October 2008
	Stated	Distributable	Translation	Revaluation	Retained
	capital	reserve	reserve	reserve	earnings	Total
	£	£	£	£	£	£
At 19 January 2007	-	-	-	-	-	-
Currency translation differences	-	-	(6,350)	-	-	(6,350)
Increase in fair value of intangible assets	-	-	-	71,098	-	71,098
Decrease in fair value of available for sale investments
	-	-	-	(25,140)	-	(25,140)
Income/(expense) recognised in equity	-	-	(6,350)	45,958	-	39,608
Net profit for the period	-	-	-	-	1,628,778	1,628,778
Issue of ordinary share capital	104,350,000	-	-	-	-	104,350,000
Reduction of stated capital account (note 17)
	(102,350,000)	102,350,000	-	-	-	-
At 31 October 2007	2,000,000	102,350,000	(6,350)	45,958	1,628,778	106,018,386
At 30 April 2008	2,000,000	102,350,000	495,708	52,292	1,271,645	106,169,645
Currency translation differences	-	-	9,717,505	-	-	9,717,505
Increase in fair value of available for sale investments
	-	-	-	81,300	-	81,300
Income recognised in equity	-	-	9,717,505	81,300	-	9,798,805
Net loss for the period	-	-	-	-	(6,275,069)	(6,275,069)
Dividend paid (at £0.03 per share)	-	-	-	-	(3,130,119)	(3,130,119)
At 31 October 2008	2,000,000	102,350,000	10,213,213	133,592	(8,133,543)	106,563,262

Cambium Global Timberland Limited
Condensed Consolidated Interim Cash Flow Statement
For the period ended 31 October 2008
						For the period		For the period
						31 October 2008		31 October 2007
						£		£
Cash flows from operating activities
Operating profit/(loss) for the period						5,753,654		(2,218,103)
Adjustments for:
	Gain on revaluation of land and plantations					(7,339,640)		(2,462,172)
	Depreciation					660		141
	Asset Revaluation					847		-
	Decrease/(increase) in trade and other receivables					447,939		(63,040)
	Increase in trade and other payables					1,761,339		357,751
						(5,128,855)		(2,167,320)
Net cash from operating activities						624,799		(4,385,423)
Cash flows from investing activities
Purchase of property, plant and equipment						(30,714)		(659,751)
Purchase of land and plantations						(36,726,754)		(19,274,668)
Cost capitalised to plantations						(513,292)		(84,222)
Purchase of intangible assets						-		(44,436)
Purchase of available for sale investments						(1,993,200)		(8,934,040)
Net cash used in investing activities						(39,263,960)		(28,997,117)
Cash flows from financing activities
Net proceeds from the issue of shares						-		104,350,000
Dividends paid						(3,130,119)		-
Finance income						1,462,946		2,942,606
Finance costs						-		-
Net cash from financing activities						(1,667,173)		107,292,606
Foreign exchange movements						6,248,764		(561,264)
Net increase in cash and cash equivalents						(34,057,570)		73,348,802
Cash and cash equivalents as at beginning of the period						73,757,639		-
Cash and cash equivalents as at the end of the period						39,700,069		73,348,802

Cambium Global Timberland Limited
Condensed Company Interim Income Statement
for the period ended 31 October 2008
			For the period from		For the period from
			1 May 2008 to		19 January 2007 to
			31 October 2008		31 October 2007
			£		£
Administrative expenses			(748,645)		(1,097,110)
Establishment expenses			-		(3,391,375)
Operating loss			(748,645)		(4,488,485)
Finance income			1,453,169		3,453,297
Net finance income			1,453,169		3,453,297
Net foreign exchange (loss)/gain			(2,153,683)		1,196,148
(Loss)/profit for the period			(1,449,159)		160,960

 

Cambium Global Timberland Limited
Condensed Company Interim Balance Sheet
At 31 October 2008
						At 31 October 2008		At 30 April 2008		At 31 October 2007
				Notes		£		£		£
Non-current assets
Investment in subsidiary undertakings				6		2,424,234		1,333,169		16,696,925
Loans to subsidiary undertakings				11		66,963,568		20,459,175		4,505,149
						69,387,802		21,792,344		21,202,074
Current assets
Trade and other receivables				10		273,760		599,517		467,842
Available-for-sale investments				12		11,038,500		8,964,000		8,908,900
Forward exchange currency contracts				13		-		43,106		22,563,863
Cash and cash equivalents				14		30,812,829		72,928,781		72,950,616
						42,125,089		82,535,404		104,891,221
Total assets						111,512,891		104,327,748		126,093,295
Current liabilities
Bank Overdrafts						-		-		120
Trade and other payables				15		927,067		174,823		88,211
Forward exchange currency contracts				13		10,930,877		-		21,519,144
Total liabilities						11,857,944		174,823		21,607,475
Net assets						99,654,947		104,152,925		104,485,820
Equity
Stated capital				17		2,000,000		2,000,000		2,000,000
Distributable reserve						102,350,000		102,350,000		102,350,000
Revaluation reserve						63,650		(17,650)		(25,140)
Retained (loss)/earnings						(4,758,703)		(179,425)		160,960
Total equity						99,654,947		104,152,925		104,485,820

Cambium Global Timberland Limited
Condensed Company Interim Statement of Changes in Equity
For the period ended 31 October 2008
	Stated	Distributable	Revaluation	Retained
	capital	reserve	reserve	earnings	Total
	£	£	£	£	£
At 19 January 2007	-	-	-	-	-
Decrease in fair value of available for sale investments	-	-	(25,140)	-	(25,140)
Expense recognised in equity	-	-	(25,140)	-	(25,140)
Net profit for the period	-	-	-	160,960	160,960
Issue of ordinary share capital	104,350,000	-	-	-	104,350,000
Reduction of stated capital account (note 17)	(102,350,000)	102,350,000	-	-	-
At 31 October 2007	2,000,000	102,350,000	(25,140)	160,960	104,485,820
At 30 April 2008	2,000,000	102,350,000	(17,650)	(179,425)	104,152,925
Increase in fair value of available for sale investments	-	-	81,300	-	81,300
Income recognised in equity	-	-	81,300	-	81,300
Net loss for the period	-	-	-	(1,449,159)	(1,449,159)
Dividend paid	-	-	-	(3,130,119)	(3,130,119)
At 31 October 2008	2,000,000	102,350,000	63,650	(4,758,703)	99,654,947

 

Cambium Global Timberland Limited
Condensed Company Interim Cash Flow Statement
For the period ended 31 October 2008
						For the period		For the period
						31 Oct 2008		31 Oct 2007
						£		£
Cash flows from operating activities
Operating loss for the period						(748,645)		(4,488,485)
Adjustments for:
	Decrease/(increase) in trade receivables					325,757		(467,842)
	Increase in trade and other payables					752,244		88,211
	Foreign exchange loss					8,820,300		151,429
						9,898,301		(228,202)
Net cash from operating activities						9,149,656		(4,716,687)
Cash flows from investing activities
Investments acquired (increase at Note 6)						(1,091,065)		(16,696,925)
Available for sale investments acquired						(1,993,200)		(8,908,900)
Disposal of available for sale investments						-		(25,140)
Increase in loans to subsidiary undertakings						(46,504,393)		(4,505,149)
Net cash used in investing activities						(49,588,658)		(30,136,114)
Cash flows from financing activities
Net proceeds from the issue of shares						-		104,350,000
Dividends paid						(3,130,119)		-
Finance income						1,453,169		3,453,297
Net cash from financing activities						(1,676,950)		107,803,297
Net increase in cash and cash equivalents						(42,115,952)		72,950,496
Cash and cash equivalents as at beginning of the period						72,928,781		-
Cash and cash equivalents as at the end of the period						30,812,829		72,950,496

Notes to the Financial Statements

For the period ended 31 October 2008

1 General Information

The Company and its subsidiaries, including special purpose vehicles ('SPVs') controlled by the Company (together referred to as 'the Group'), were established to invest in a global portfolio of forestry based properties which can be managed on an environmentally and socially sustainable basis. Assets may be managed for timber production, environmental credit production or both. The Group currently owns forestry assets located in Australia, Hawaii, Brazil and United States mainland.

The Company is a closed-ended company with limited liability, incorporated in Jersey, Channel Islands on 19 January 2007. 

The Company has its primary listing on AIM, a market of the London Stock Exchange and a dual listing on the Channel Islands Stock Exchange.

2 Basis of preparation

The unaudited condensed consolidated and company only financial information included in the half year report for the six months ended 31 October 2008, have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and International Accounting Standard (IAS) 34,'Interim Financial Reporting'. They do not include all of the information required for full annual accounts. The half year report should be read in conjunction with the Group's Annual Report and Financial Statements for the year ended 30 April 2008, which have been prepared in accordance with International Financial Reporting Standards (IFRSs). The extra column of comparatives against October 2007 in the balance sheet is an A.I.M. requirement, and accordingly notes to these accounts are not required.

The same accounting policies and methods of computation are followed in these condensed financial statements as were applied in the preparation of the Group's financial statements for the period ended 30 April 2008, which are available on the Company's website (www.cambiumfunds.com).

The financial statements have been prepared in Sterling Pounds, which is the presentational currency of the Group and under the historical cost convention, except for the revaluation of land, plantations, intangibles, and certain financial instruments.

The preparation of the interim condensed financial statements requires Directors to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the date of the condensed interim financial statements. If in the future such estimates and assumptions, which are based on the Directors' best judgement at the date of the interim condensed financial statements, deviate from actual circumstances, the original estimates and assumptions will be modified as appropriate in the period in which the circumstances change.

In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Groups accounting policies and the key sources of estimating uncertainty were the same as those that applied to the consolidated financial statements as at, and for the period ended 30th April, 2008.

Taxation

The Company is registered as a Jersey company and will be assessed under the Income Tax (Amendment 28) (Jersey) Law 2007 and be taxed at a corporate rate of zero per cent. No charge to Jersey taxation arises on capital gains. The Group is liable to foreign tax arising on activities in the overseas subsidiaries. The Company has subsidiary operations in Australia, Hungary, Brazil, New Zealand, Uruguay, Texas and Hawaii (Delaware).

3	Segmental information
				Jersey	Australia	United States	Hawaii	Brazil
				£	£	£	£	£
	At 31 October 2008
	Total assets			42,050,104	4,498,594	54,914,747	9,672,437	13,366,419
	Segment revenue			-	34,551	280,811	-	-
	Segment gross profit			-	(24,144)	51,673	-	-
				Jersey	Australia	United States	Hawaii	Brazil
	At 30 April 2008			£	£	£	£	£
	Total assets			84,744,721	4,966,789	15,743,240	3,106,834	-
	Segment revenue			-	253,152	446,676	-	-
	Segment gross profit			-	229,810	115,878	-	-

The Group operates in four distinctly separate geographical locations, within one business segment with timberlands located in Australia (NSW), United States (Texas, north-western Florida, and south-western Georgia), Brazil and Hawaii. The Group owns;

1. Approximately 21,163 acres of land known as Tarrangower in Ashford, New South Wales, Australia. This land was previously being used for cattle grazing and is now being planted with high value commercial and non-commercial species with a view to longer term revenue from plantations and short term revenue from carbon credits. In addition to this, the Group has managed to secure a grant from the local Catchments Management Authority for biodiversity conservation and salinity control services provided by Tarrangower as a timber and carbon estate.

2. Approximately 21,853 acres of land in Texas known as Corrigan of which the majority is established loblolly pine plantation. The land is characterized as having a balanced age class of timber suitable for short term and long term sustainable yield.

3. Approximately 29,900 acres of timberland located in north-western Florida and south-western Georgia (United States) known as South Atlantic States. The property consists of professionally managed diverse pine plantations that possess a well structured array of age classes allowing immediate harvest income. Marketable products include sawtimber and pulp, which can be sold into healthy forest product markets that exist in this geography. The property also generates revenue from hunting leases.

4. Two plantations in Hawaii known as Pahala and Pinnacle.

Pahala consists of 3,700 acres of mature Eucalyptus trees. The plantation was acquired to provide for the needs of a veneer mill which is coming in to operation. This will generate higher value products such as veneer logs as opposed to commodity wood chips.

The Group has purchased a leasehold interest on Pinnacle, a Hawaiian property. The Pinnacle investment comprises of approximately 4,500 acres located on the Big Island of Hawaii. The asset consists of existing plantations which will be managed for timber production. 

The Group acquired approximately 25,700 acres of bare-land timber property located in northern Brazil. The greenfield eucalyptus project is being developed on land previously used for grazing and is in a region with multiple end use markets. It is anticipated that the eucalyptus will be grown on a rotation length of seven years. 

4	Basic and diluted earnings per share
	The calculation of the basic and diluted earnings per share is based on the following data:
						Group	Group	Group
						31 Oct 2008	31 Oct 2007	30 Apr 2008
						£	£	£
	Earnings for the purposes of basic and diluted earnings per share being net profit for the period as per income statement
						(6,275,069)	1,628,778	1,271,645
	Number of ordinary shares
	Number of ordinary shares for basic and diluted earnings per share:
	Weighted average number of ordinary shares for the purposes of basic and diluted earnings per share
						104,350,000	104,350,000	104,350,000
	Basic and diluted earnings per share					(6.01) p	1.56 p	1.22 p
5	Net Asset Value					Group	Group	Group
						31 Oct 2008	31 Oct 2007	30 Apr 2008
						£	£	£
	Total assets					124,502,301	127,895,401	108,561,584
	Total liabilities					(17,939,039)	(21,877,015)	(2,391,939)
	Net Asset Value					106,563,262	106,018,386	106,169,645
	Number of shares in issue					104,350,000	104,350,000	104,350,000
	Net Asset Value per share					1.0212	1.0160	1.0174
6	Investment in subsidiaries
	A list of the significant investments in subsidiaries incorporated since 1 May 2008 up to 31 October 2008, including the name, country of incorporation and the proportion of ownership interest is given below.
	Name of subsidiary undertaking				% of voting rights	Country of incorporation		Principal activity
	Cambium New Zealand Holdings Limited							Forestry
					100%	New Zealand
	Cambium Uruguay Holdings Limited				100%	Uruguay		Forestry
	Cambium South Atlantic Holdings Ltd				100%	United States		Forestry
	The forests in New Zealand and Uruguay are still to be acquired.

6	Investment in subsidiaries (continued)
	Investments held by the Company:						Company	Company
							31 Oct 2008	30 Apr 2008
							£	£
	Cambium Tarrangower Holdings Limited						1,195,130	1,191,567
	Cambium Pahala Holdings Limited						75,156	67,455
	Cambium Pinnacle Holdings Limited						62,677	49
	Cambium Holdings Limited						51	51
	Corrigan Holdings Limited						93,110	36,999
	Cambium Minas Gerias Holdings Limited						75,565	36,999
	Cambium MG Holdings Limited						38,274	49
	Cambium Uruguay Holdings Limited						3	-
	Cambium South Atlantic Holdings Limited						21,979	-
	Cambium New Zealand Holdings Limited						862,289	-
							2,424,234	1,333,169
7	Plantations						Group	Group
							31 Oct 2008	30 Apr 2008
							£	£
	Fair Value at beginning of period						23,807,920	-
	Additions: plantations & land purchased						36,726,754	19,688,534
	Additions: costs capitalised						513,292	559,827
	Gains arising from growth						1,073,927	537,978
	Fire, hazardous weather, and other damages (impairment)						(218,675)	-
	Harvesting - agricultural produce (fellings)						(265,895)	(437,588)
	Disposal: plantations and land sold						-	-
	Net gain/loss from fair value adjustments on plantations						6,938,201	2,862,320
	Translation difference						4,274,206	596,849
	Fair Value at end of period						72,849,730	23,807,920

The land and plantations are carried at their fair value as at 31 October 2008, as measured by external independent valuers URS Australia Pty Ltd ('URS') and Day Forest Management and Appraisal Inc.

The appraisal on the Texas and Cambium South Atlantic (north-western Florida and south-western Georgia) forests were undertaken by Day Forest Management and Appraisal Inc. in conformance with Uniform Standards of Professional Appraisal Practice. For this valuation three valuation approaches were used as considered applicable. These included the cost approach, the sales comparison approach and the income approach.

The methodology used by URS to determine the land value of the Australian plantation is consistent with the Australian equivalent of IFRS. The preferred approach in the Standard is the fair value model. While non-forestry land values can be assessed using transaction evidence, there is no comparable transaction evidence to determine the value of land for forestry purposes in the region. Therefore, URS has applied a discounted cash flow analysis to determine the value of the land for forestry purposes. The small plantation area is valued according to the requirements of Australian Accounting Standards Board 141 Agriculture which is consistent with IFRS. The property revaluation was performed taking into account the Group's intention to use land for plantation purposes.

7 Plantations (continued)

The plantations in Hawaii were valued by URS at fair value. The market value of the plantations has been assessed using a discounted cash flow (DCF) in accordance with IFRS. A discount rate of 7.5 per cent real was derived using a Capital Asset Pricing Model (CAPM)/Weighted Average Cost of Capital (WACC) methodology and applied to real, pre tax cash flows.

URS has valued the Pinnacle plantations based on a log export scenario as this is the most viable market currently available. Export prices were determined based on log export prices for plantation grown Eucalyptus deglupta sourced from Papua New Guinea (ITTO 2008) and the Solomon Islands (NFAM 2008). The analysis found that the small pulpwood logs could not be viably exported, so only the veneer logs produced have commercial value.

8	Property, plant and equipment
							Motor
	As At 31 October 2008			Buildings	Improvements	FF&F	vehicles	Total
				Group	Group	Group	Group	Group
				£	£	£	£	£
	Opening Net Book Amount
	Cost or valuation			351,493	97,692	-	12,815	462,000
	Accumulated Depreciation			-	-	-	(880)	(880)
	Net Book Amount			351,493	97,692	-	11,935	461,120
	Period Ended 31 October 2008
	Opening Net Book Amount			351,493	97,692	-	11,935	461,120
	Exchange Differences			(45,929)	(12,728)	-	(1,559)	(60,216)
	Revaluation			-	(847)	-	-	(847)
	Additions			-	30,054	660	-	30,714
	Disposals			-	-	-	-	-
	Depreciation Charge			-	-	(6)	(654)	(660)
				305,564	114,171	654	9,722	430,111
	Closing Net Book Amount
	Cost or valuation			305,564	114,171	660	11,205	431,600
	Accumulated Depreciation			-	-	(6)	(1,483)	(1,489)
	Net Book Amount			305,564	114,171	654	9,722	430,111
							Motor
	As At 30 April 2008			Buildings	Improvements	FF&F	vehicles	Total
				Group	Group	Group	Group	Group
				£	£	£	£	£
	Period Ended 30 April 2008
	Opening Net Book Amount			-	-	-	-	-
	Exchange Differences			27,135	7,542	-	921	35,598
	Revaluation			(41,528)	(1,749)	-	-	(43,277)
	Additions			365,886	91,899	-	11,894	469,679
	Disposals			-	-	-	-	-
	Depreciation Charge			-	-	-	(880)	(880)
				351,493	97,692	-	11,935	461,120
	Closing Net Book Amount
	Cost or valuation			351,493	97,692	-	12,815	462,000
	Accumulated Depreciation			-	-	-	(880)	(880)
	Net Book Amount			351,493	97,692	-	11,935	461,120

8 Property, plant and equipment (continued)

The buildings and improvements are carried at their fair value as at 31 October 2008, as measured by external independent valuers URS Australia Pty Ltd and Day Forest Management and Appraisal Inc. (in conjunction with the external valuation of plantations). The valuations have been prepared using techniques approved under IFRS. The motor vehicles and furniture, fixtures, and fittings are carried at cost less accumulated depreciation. 

9	Intangible assets						Group	Group
							31 Oct 2008	30 Apr 2008
							£	£
	Cost - water licence						123,164	43,714
	Revaluation						-	69,942
	Foreign exchange effect						(16,093)	9,508
							107,071	123,164

The Tarrangower property has approximately 4km of frontage to the Severn River and has attached to it a water licence administered by the Department of Natural Resources in Australia (DNR). The 105 mega litre surface irrigation license (Number 90SL100620) has rights attached to it allowing an annual allocation of 48 mega litres A class and 57 mega litres B class from Pindari Dam which is located 11km further up stream. The licence is renewable on a 5 yearly basis and at a small administration cost to the Group.

The licence is measured at fair value as at 30 April 2008, as measured by external independent valuers URS Australia Pty Ltd. The valuations have been prepared using techniques approved under IFRS. 

10	Trade and other receivables				Group	Company	Group	Company
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					£	£	£	£
	Accrued interest on bonds				67,196	67,196	53,565	53,565
	Bank interest receivable				14,971	14,971	141,591	141,591
	Inter-company debtors				-	111,025	-	-
	Goods & Service Tax Receivable				-	-	8,985	-
	Trade receivables				25,316	-	199,940	41,696
	Accrued Income on hunting lease				27,691	-	-	-
	Other Debtors				1,101	578	-	-
	Deferred Costs				75,164	38,762	87,341	87,341
	Deposit Paid				-	-	251,572	251,572
	Prepaid expenses				64,939	41,228	31,636	23,752
					276,378	273,760	774,630	599,517
11	Loans to subsidiary undertakings				Company	Company	Company	Company
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					US $	£	US $	£
	Cambium Corrigan Holdings Limited				13,620,129	8,375,433	13,589,129	6,893,137
	Corrigan Holdings Limited				13,620,129	8,375,433	13,589,129	6,893,136
	Cambium Pahala Holdings Limited				5,933,997	3,648,995	5,683,997	2,883,229
	Cambium Pinnacle Holdings Limited				8,023,686	4,934,009	-	-
	Cambium South Atlantic Holdings Limited				44,745,000	27,515,343	-	-
					85,942,941	52,849,213	32,862,255	16,669,502

11	Loans to subsidiary undertakings (continued)
					AU $	£	AU $	£
	Cambium Tarrangower Holdings Limited				8,000,000	3,294,486	8,000,000	3,789,673
						£		£
	Cambium MG Holdings Limited					10,643,944		-
	Cambium Minas Gerais Holdings Limited					175,925		-
						10,819,869		-
	Total Loans to subsidiary undertakings					66,963,568		20,459,175
	All inter-company loans are interest free and have no fixed terms of repayment. The Directors do not anticipate that payment on these loans will be demanded during the next 12 months.
12	Available-for-sale investments
					Group	Company	Group	Company
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					£	£	£	£
	UK Treasury stock 4% 7th March 2009				11,038,500	11,038,500	8,964,000	8,964,000
	The fair value of the UK Treasury stock is determined with standard terms and conditions and traded on the London Stock Exchange determined with reference to quoted market prices.
13	Forward exchange currency contracts
					Group	Company	Group	Company
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					£	£	£	£
	Forward foreign currency contracts:				(10,930,877)	(10,930,877)	43,106	43,106

As at 31 October 2008 there were 12 forward foreign currency contracts in place. They are used to hedge against foreign exchange exposure arising from investing in foreign operations and foreign currency transactions. For the period ended 31st October 2008, the loss sustained as a result of the forward contracts is offset against the valuation gain on foreign currency loans contained in the translation reserve, and not taken to the Income Statement due to accounting standard treatment. The Income Statement does not provide a true reflection of the underlying performance of the fund, and instead, reference should be made to the Net Asset Value quarterly calculations.

Forward exchange currency contracts held by the Company and the Group at their forward exchange rates are listed below. All of the contracts have a strike date of 30 April 2009, except for the 16.6m BRL, which has a strike date of 05 January, 2009.

						US $	£
Forward exchange currency contracts for United States Dollar						102,250,000	52,742,049
						AU $	£
Forward exchange currency contracts for Australian Dollar						10,500,000	4,819,414
						BRL	£
Forward exchange currency contracts for Brazilian Real						54,850,000	15,547,226
						£	BRL
Forward exchange currency contracts for United Kingdom Sterling						4,466,280	15,000,000

14	Cash and cash equivalents
					Group	Company	Group	Company
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					£	£	£	£
	Total				39,700,069	30,812,829	73,757,639	72,928,781
15	Trade and other payables
					Group	Company	Group	Company
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					£	£	£	£
	Accruals				265,481	94,360	187,068	174,823
	Trade creditors				98,729	-	70,444	-
	Outstanding payment due on acquisition				1,442,543		-	-
	Intercompany creditors				-	832,707	-	-
	Advances held				307,782	-	214,162	-
					2,114,535	927,067	471,674	174,823
16	Other liabilities
							Group	Group
							31 Oct 2008	30 Apr 2008
							£	£
	Retention Guarantee						281,096	-
	Other						658	-
							281,754	-
17	Stated capital
					Company	Group	Company	Group
					31 Oct 2008	31 Oct 2008	30 Apr 2008	30 Apr 2008
					£	£	£	£
	Net proceeds from issue of shares				104,350,000	104,350,000	104,350,000	104,350,000
	Less: reduction in share capital				(102,350,000)	(102,350,000)	(102,350,000)	(102,350,000)
					2,000,000	2,000,000	2,000,000	2,000,000

18 Capital risk management

The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost to capital.

In order to maintain or adjust the capital structure the Group may adjust amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell net assets to reduce debt.

In order to ensure that the Group will be able to continue as a going concern, management continuously monitor forecast and actual cash flows and matching the maturity profiles of assets and liabilities. The Group has no external borrowings.

The Group uses forward contracts to hedge the foreign exchange risk to the NAV of the Group's assets. The Group closely monitors the positions for liquidity risk.

19 Events after the Balance Sheet date

The Group has acquired on 13th November, 2008 and 14th January 2009 two properties totaling approximately 26,809 acres of bare land timber property to establish eucalyptus plantations for conversion to charcoal by use by the pig iron industry in Brazil. The expenditure to purchase the land was approximately £7,500,000 and an additional commitment of up to £8,500,000 will be required to establish the plantation over the next two years.

Other than the above, the Group had no significant post balance sheet events.

20 Related party transactions

Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions. CP Cogent Asset Management LP is the Investment Manager to the Company under the terms of the Investment Manager Agreement and is thus considered a related party of the Company.

During the period £579,839 (30 April 2008 £1,207,676) was paid to CP Cogent Asset Management LP in respect of management fees.

Transactions between the Company and its subsidiaries, which are related parties, have been disclosed in note 6 and 11.

Colin McGrady is a Director of CP Cogent Asset Management LP, who acts as Investment Manager. He is also a Director of the Company and has waived his Director's fees for the period.

Colin McGrady acts as a Director of many SPV's, and has waived these fees for the period.

Donald Adamson and Martin Richardson are also Directors of a number of Jersey SPV's, and have waived these fees for the period.

The Directors of the Company received total fees as follows:

						31 Oct 2008	30 Apr 2008
						£	£
Donald Adamson						20,109	49,753
Martin Richardson						12,568	31,096
Robert Rickman						12,568	31,096
William Spitz						12,568	31,096
						57,813	143,041

Cambium Global Timberland Limited
Key Parties
Directors				Registered Office of the Company
Donald Adamson				5 Castle Street
Robert Rickman				St Helier
William Spitz				Jersey
Martin Richardson				JE2 3RT
Colin McGrady				Telephone +44 (0)1534 512512
Registrar, Paying Agent and Transfer Agent				Auditors
Capita Registrars (Jersey) Limited				KPMG Channel Islands Limited
PO Box 378				PO Box 453
Jersey				5 St Andrews Place
JE4 0FF				Charing Cross
				St Helier
				Jersey
				JE4 8WQ
Nominated Adviser for AIM				Sponsor to CISX Listing
PricewaterhouseCoopers LLP				Carey Olsen Corporate Finance Limited
Plumtree Court				44 Esplanade
London				St Helier
EC4 A 4HT				Jersey
				JE1 0BD
Broker				Investment Manager
Matrix Corporate Capital LLP				CP Cogent Asset Management, LP
One Vine Street				100 Crescent Court
London				Suite 500
W1J 0AH				Dallas
				TX 75201
Administrator and Company Secretary				Property Valuers
Investec Trust (Jersey) Limited				Day Forest Management & Appraisal Inc
5 Castle Street				PO Drawer 1169
St Helier				4711 North Wheeler / Highway 96 North
Jersey				Jasper
JE2 3RT				Texas 75951
Property Valuers
URS Australia Pty Ltd
Level 6, 1 Southbank Boulevard
Southbank
Victoria 3006
Australia

ENDIR GUUWWGUPBGAA

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