Ceres Global Ag Corp.
TSX : CRP
TSX : CRP.WT

Ceres Global Ag Corp.

August 04, 2009 16:05 ET

Ceres Global Ag Corp. Announces Results for the Fiscal Quarter Ended June 30, 2009

TORONTO, ONTARIO--(Marketwire - Aug. 4, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES OF AMERICA

The management of Ceres Global Ag Corp. ("Ceres" or the "Corporation")(TSX:CRP)(TSX:CRP.WT) is announcing its results for the fiscal quarter ended June 30, 2009.

The performance of the public market portfolio continued to improve during the first quarter of the fiscal year ending March 31, 2010 ("Q1 2010"). As at June 30, 2009, the net asset value attributable to each outstanding Common Share and related Warrant was $8.26, compared to $7.42 as at March 31, 2009, $6.36 as at December 31, 2008, $8.65 as at September 30, 2008, $12.71 as at June 30, 2008 and $10.75 as at March 31, 2008. The net asset value as at June 30, 2009 represents an increase of 11.2% for the quarter ended June 30, 2009.

For the quarter ended June 30, 2009, Ceres reported net income of $10,592,742, which included a change in the unrealized appreciation of investments in the amount of $10,181,455 (quarter ended June 30, 2008: net income of $25,280,105, including a change in the unrealized appreciation of investments of $26,640,403). For the quarter ended June 30, 2009, basic and diluted earnings per share was $0.82 (quarter ended June 30, 2008: basic and diluted earnings per share was $1.96).

For the quarter ended June 30, 2009, Ceres earned dividend, interest and other revenues totalling $755,578 (quarter ended June 30, 2008: dividends, interest and other revenues totalling $674,933).

Ceres invests primarily in securities of publicly traded companies located in Canada, the United States of America and other countries. As at June 30, 2009, the fair value of investments owned by Ceres totalled $109,729,054 and the cost thereof was $118,723,401 (March 31, 2009: portfolio of publicly traded equity securities having an aggregate fair value of $80,874,373 and an aggregate cost of $100,970,612). As at that date, the Corporation's investment in securities of private companies represented 1.30% (March 31, 2009: 1.48%) of its total assets, and is not significant to its overall financial position.

As at June 30, 2009, the Corporation is liable to cover its short position on selected publicly traded equity securities. As at that date, the liability at fair value to cover short sales is $18,643,820, which is net of an unrealized loss on the short sales of $1,156,674 (March 31, 2009: fair value of liability was $14,828,063, including an unrealized loss of $1,457,940).

As at June 30, 2009, the Corporation had unearned premiums on written options. As at that date, the fair value of the unearned options was $358,920, which is net of an unrealized gain on the unearned premiums on written options in the amount of $116,374 (March 31, 2009: $362,292, net of an unrealized gain of $93,812).

As at June 30, 2009, the Corporation had positions on certain commodity futures, on which it recognized an unrealized loss of $224,750 (March 31, 2009: no positions in commodity futures).

As at June 30, 2009 and March 31, 2009, Ceres owned investments primarily in debt and equity securities of publicly traded issuers, in the following agricultural industry sub-sectors:



(at fair values) June 30, 2009 March 31, 2009
-----------------------------
Fertilizers $ 28,909,869 $ 27,571,949
Food manufacturing and retailing 24,525,254 10,470,188
Equipment manufacturers and distributors 20,839,701 18,974,941
Agricultural commodity handlers and processors 20,378,348 10,432,554
Miscellaneous 9,454,927 2,157,069
Seed technology 4,714,142 5,566,956
Chemicals 906,813 5,700,716
----------------------------------------------------------------------------
$109,729,054 $ 80,874,373
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Investments sold short are in equity securities of publicly-traded issuers,
in the following agricultural industry sub-sectors:

(at fair values) June 30, 2009 March 31, 2009
-----------------------------
Fertilizers $ (8,229,640)$ (7,019,907)
Equipment manufacturers and distributors (3,782,136) (1,242,628)
Food manufacturing and retailing (2,500,291) (2,567,872)
Miscellaneous (2,371,544) (1,242,099)
Chemicals (1,355,009) (1,705,353)
Agricultural commodity handlers and processors (405,200) (1,050,204)
----------------------------------------------------------------------------
$ (18,643,820)$ (14,828,063)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Unearned options premiums on written call and put options for publicly
traded companies are in the following agricultural industry sub-sectors:

(at fair values) June 30, 2009 March 31, 2009
-----------------------------
Fertilizers $ (160,391)$ (183,981)
Seed technology (88,331) (42,845)
Agricultural commodity handlers and processors (71,496) (68,048)
Miscellaneous (24,174) -
Equipment manufacturers and distributors (14,528) (46,625)
Chemicals - (20,793)
----------------------------------------------------------------------------
$ (358,920)$ (362,292)
----------------------------------------------------------------------------
----------------------------------------------------------------------------

As at June 30, 2009, the Corporation's investment in private companies
represented 1.30% (March 31, 2009: 1.48%) of total assets.

As at June 30, 2009, the top-ten holdings of the Corporation, ranked by fair
value, are:

Name of investee Fair value
----------------------------------------------------------------------------
AG Growth International Incorporated $ 12,374,707
Potash Corporation of Saskatchewan Inc. 7,337,092
Agrium Inc. 4,308,502
FMC Corporation 3,864,702
Tyson Foods Inc. 3,817,992
Bunge Limited 3,675,799
Saputo Inc. 3,360,010
Monsanto Company 3,214,142
Hemisphere GPS Inc. 3,201,189
Bunge NA Finance LP 3,138,703
----------------------------------------------------------------------------
$ 48,292,838
----------------------------------------------------------------------------
----------------------------------------------------------------------------

As at June 30, 2009, the fair values of the top-ten holdings of the
Corporation, ranked agricultural industry sub-sectors, are:

Fair Value
----------------
Equipment manufacturers and distributors $ 15,575,896
Fertilizers 11,645,594
Food manufacturing and retailing 7,178,002
Agricultural commodity handlers and processors 6,814,502
Miscellaneous 3,864,702
Seed technology 3,214,142
----------------------------------------------------------------------------
$ 48,292,838
----------------------------------------------------------------------------
----------------------------------------------------------------------------

As at March 31, 2009, the top-ten holdings ranked by fair value are:

Name of investee Fair value
----------------------------------------------------------------------------
AG Growth Income Fund $ 11,169,768
Potash Corporation of Saskatchewan Inc. 5,181,405
Hemisphere GPS Inc. 4,263,673
FMC Corporation 3,811,947
Hanfeng Evergreen Inc. 3,762,074
The Mosaic Company 3,738,330
Terra Industries Inc. 3,621,159
CF Industries Holdings Inc. 3,331,533
Saputo Inc. 3,292,045
Monsanto Company 2,427,703
----------------------------------------------------------------------------
$ 44,599,637
----------------------------------------------------------------------------
----------------------------------------------------------------------------

As at March 31, 2009, the fair values of the top-ten holdings of the
Corporation, ranked by agricultural industry sub-sectors, are:


Fair Value
----------------
Fertilizers $ 19,634,501
Equipment manufacturers and distributors 15,433,441
Chemicals 3,811,947
Food manufacturing and retailing 3,292,045
Seed technology 2,427,703
----------------------------------------------------------------------------
$ 44,599,637
----------------------------------------------------------------------------
----------------------------------------------------------------------------


The Corporation's public portfolio continued to perform well in the quarter, however a softening supply and demand for Agricultural products worldwide began to appear, driven in part bullish crop plantings in North America and a continued fallout from the credit crisis which has made us more conservative in our outlook for the near and short term. Consequently, during the first quarter we began moving into a more conservative portfolio. This moved involved crystallizing certain gains in the portfolio over the past 6 months and reallocating this capital to more stable investments such as food manufacturing companies, certain fixed income securities and cash.

Subject to certain prospective positive changes in the short and near term fundamentals in Agriculture we expect to remain defensive throughout the summer and look for opportunistic investments in both stocks and fixed income securities as they arise.



CERES GLOBAL AG CORP.
Summary Statement of Operations and Retained Earnings
For the three-month period ended June 30, 2009
(with comparative figures for the three-month period ended June 30, 2008)
(Unaudited)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Quarter ended Quarter ended
June 30, 2009 June 30, 2008
-------------- --------------
Dividend, interest and other revenues $ 755,578 $ 674,933

Operating expenses 1,024,887 7,922,333
----------------------------------------------------------------------------
Loss from operations (269,309) (7,247,400)
Realized gain (loss) on sale of investments (2,572,472) 7,076,162
Realized gain (loss) on currency hedging
transactions 4,303,116 (1,004,546)
Realized and unrealized loss on
foreign exchange (1,050,048) (184,514)
Change in unrealized gain on investments 10,181,455 26,640,403
----------------------------------------------------------------------------
Income (loss) before income taxes 10,592,742 25,280,105
----------------------------------------------------------------------------
Income taxes
Provision for current income taxes - 394,378
Provision for recovery of future
income taxes - (394,378)
----------------------------------------------------------------------------
- -
----------------------------------------------------------------------------
Net income for the period 10,592,742 25,280,105
Deficit, beginning of period (48,574,590) (5,595,785)
----------------------------------------------------------------------------
Retained earnings (deficit), end of period $ (37,981,848) $ 19,684,320
----------------------------------------------------------------------------
----------------------------------------------------------------------------

Earnings per share
Basic $ 0.82 $ 1.96
----------------------------------------------------------------------------
Fully diluted $ 0.82 $ 1.96
----------------------------------------------------------------------------


For the quarter ended June 30, 2009, operating expenses totalled $1,024,887 (quarter ended June 30, 2008: $7,922,333). Of that amount, management fees totalled $550,594 (quarter ended June 30, 2008: $856,510), the provision for incentive fees totalled $nil (quarter ended June 30, 2008: $6,594,437), portfolio transaction costs totalled $169,406 (quarter ended June 30, 2008: $221,893), and general and administrative expenses totalled $139,159 (quarter ended June 30, 2008: $148,354).

The provision for an incentive fee of $6,594,437, which was recognized in the accounts for the quarter ended June 30, 2008, was reversed in the following quarter. For the quarter ended June 30, 2009, no provision for an incentive fee has been recognized and no liability for an incentive fee is payable.



CERES GLOBAL AG CORP.
Summary Balance Sheet
As at June 30, 2009 and March 31, 2009
----------------------------------------------------------------------------
----------------------------------------------------------------------------
June 30, 2009 March 31, 2009
-------------- ---------------
ASSETS (unaudited) (audited)
Cash $ 16,247,992 $ 14,233,183
Investments owned, at fair value 109,729,054 80,874,373
Unrealized gain on forward foreign
exchange contracts 11,959 397,957
Dividends and interest receivable, and due
from broker 4,151,816 19,480,815
Account receivable 205,994 -
Income taxes recoverable 43,568 43,568
Prepaid expenses 10,764 22,425
----------------------------------------------------------------------------
TOTAL ASSETS $ 130,401,147 $ 115,052,321
----------------------------------------------------------------------------
----------------------------------------------------------------------------

LIABILITIES
Accounts payable, accruals and provisions $ 596,647 $ 387,108
Due to broker 1,483,875 1,884,870
Unearned premium on written options,
at fair value 358,920 362,292
Unrealized loss on forward foreign
exchange contracts 2,740,628 1,953,876
Unrealized loss on commodity futures
contract 224,750 -
Investments sold short, at fair value 18,643,820 14,828,063
----------------------------------------------------------------------------
TOTAL LIABILITIES 24,048,640 19,416,209
----------------------------------------------------------------------------
----------------------------------------------------------------------------

SHAREHOLDERS' EQUITY
Common shares 135,243,560 135,197,540
Warrants 9,026,038 9,013,163
Contributed surplus 64,757 -
Deficit (37,981,848) (48,574,591)
----------------------------------------------------------------------------
TOTAL SHAREHOLDERS' EQUITY 106,352,507 95,636,112
----------------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 130,401,147 $ 115,052,321
----------------------------------------------------------------------------
----------------------------------------------------------------------------


Ceres is an investment company. Its investments in debt and equity securities are classified as held-for-trading, and measured and reported at fair value with unrealized gains or losses recognized in operations for the period.

This news release contains forward-looking statements concerning the Corporation's business and operations. The Corporation cautions that, by their nature, forward-looking statements involve risks and uncertainty and the Corporation's future actual results could vary materially from those expressed or implied in such statements. Reference should be made to the Corporation's annual audited financial statements, its management discussion and analysis, or the initial public offering prospectus dated December 13, 2007 for a description of the major risk factors.

Contact Information

  • Ceres Global Ag Corp.
    Jason Gould
    Chief Financial Officer
    (416) 915-2426