Feronia Inc.

TSX VENTURE : FRN


Feronia Inc.

April 23, 2014 08:00 ET

Feronia Inc. Reports 2013 Results

TORONTO, ONTARIO--(Marketwired - April 23, 2014) - Feronia Inc. ("Feronia" or the "Company") (TSX VENTURE:FRN) today released its audited financial results for the year ended December 31, 2013. All amounts in this release are expressed in US dollars unless otherwise indicated.

2013 Highlights

  • Produced 8,269 tonnes of Crude Palm Oil ("CPO") (2012: 7,044) from 45,015 tonnes of fruit (2012: 38,596 tonnes), a year-over-year increase of 17.4%
  • Replanted 5,007 hectares ("ha") of oil palm (2012: 3,924 ha)
  • Fresh fruit bunch ("FFB") yield of 7.1 tonnes per ha (2012: 6.1 tonnes per ha) on a like-for-like basis excluding Yaligimba, a year-over-year increase of 16.4%
  • Increase in oil extraction rate ("OER") to 18.47% (2012: 18.25%) on a like-for-like basis excluding Yaligimba
  • Yaligimba CPO mill completed and commissioned on October 18, 2013 and contributing to revenue for the first time
  • Formed an Environmental, Social and Governance ("ESG") Committee and devised, documented and secured funding for an Environmental and Social Action Plan ("ESAP") which was commenced in November
  • Revenue of $6.7 million (2012: $7.1 million) including from the sale of:
    • 7,404 tonnes of CPO at an average price of $768 per tonne (2012: 6,993 tonnes at $906 per tonne)
    • 362 tonnes of Palm Kernel Oil ("PKO") at an average price of $756 per tonne (2012: 431 tonnes at $1,084 per tonne)
    • 606 tonnes of locally grown and processed rice sold exclusively into the domestic market
  • Arable Farming division commenced sales of rice grown on the Company's farm and became an approved supplier to Heineken N.V. in the DRC.
  • Demonstrated commercial rice yields from mechanised harvesting at arable farm
  • Closed two non-brokered private placements for aggregate gross proceeds of $39 million
  • Hired new Chief Financial Officer and Managing Director of Palm Oil
  • Net loss attributable to Feronia was $(10.1m) or $(0.03) per share, compared to a loss of $(6.7m) or $(0.04) per share in 2012

Subsequent Events

  • Commenced 2014 replanting of 5,000 ha of oil palm on March 15, 2014

Ravi Sood, Chairman of Feronia Inc. commented: "In 2013 the Company achieved several key initiatives. In October the new palm oil mill at Yaligimba was commissioned, enabling production from 3,757 ha of existing mature palms at that location in the short-term and providing the processing capacity necessary for the long-term growth of the plantation. In November we reached our 2013 re-planting target of 5,000 ha of oil palms, one of the largest planting programmes in the world and the largest in Africa. With our existing mature palms we increased yields by approximately 17% with a commensurate increase in CPO production.

"The Company completed two further equity financings during the year each led by a strategic investor. The addition of CDC Group plc ("CDC"), the UK's development finance arm, and the African Agriculture Fund, one of Africa's pre-eminent private equity funds, as major investors has strengthened our governance, financial stability, and access to additional funding for future requirements, a major factor in de-risking our operation.

"Coincident with the CDC-led financing, we created a new ESG Committee comprised of independent directors to monitor progress and issues related to ESG matters and report directly to the Board of Directors. Moreover, we created and implemented an Environmental and Social Action Plan with ring-fenced funding provided in the form of a loan from CDC, against the objectives defined in the plan.

"We continued to add to our management team securing a Chief Financial Officer with the experience and capability to lead the Company through its next phase of growth and a Managing Director Palm Oil with the background and skills needed to continue the positive operating momentum and assist with our increased focus on ESG-related objectives. We also re-instated a Management Training Programme, which had produced many of the DRC's finest executives, most of whom are still with the Company.

"In 2014, we will continue to drive value creation in our palm oil division through new plantings and increasing yields through the utilisation of best practices, improved harvesting and evacuation, and the application of fertiliser. We will also make marginal improvements to our processing capacity and efficiency through further investment in our palm oil mills. In our arable farming division, we will continue to focus on yields and are investigating mechanisms to fund the growth of this operation without diluting shareholders."

About Feronia Inc.

  • Feronia Inc. is a large-scale commercial farmland and plantation operator in the Democratic Republic of the Congo ("DRC").
  • The Company uses modern agricultural practices to operate and develop its oil palm plantations and arable farming business division.
  • Feronia believes in the immense agricultural potential of the DRC for high-quality foodstuffs and edible oils given its ideal climate, excellent soil and highly skilled and experienced workforce.
  • Feronia's management team is comprised of senior agriculturalists with extensive experience in managing both plantations and large-scale mechanized farming operations in emerging markets.
  • Feronia is committed to sustainable agriculture, environmental protection and providing support for local communities.
  • For more information please see www.feronia.com

Cautionary Notes

Except for statements of historical fact contained herein, the information in this press release constitutes "forward-looking information" within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as "anticipates", "plans", "proposes", "estimates", "intends", "expects", "believes", "may" and "will". There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others: risks related to foreign operations (including various political, economic and other risks and uncertainties), the interpretation and implementation of the"Loi Portant Principes Fondamentaux Relatifs A L'Agriculture", termination or non-renewal of concession rights or expropriation of property rights, political instability and bureaucracy, limited operating history, lack of profitability, lack of infrastructure in the DRC, high inflation rates, limited availability of debt financing in the DRC, fluctuations in currency exchange rates, competition from other businesses, reliance on various factors (including local labour, importation of machinery and other key items and business relationships), the Company's reliance on one major customer, lower productivity at the Company's plantations and arable farming operations, risks related to the agricultural industry (including adverse weather conditions, shifting weather patterns, and crop failure due to infestations), a shift in commodity trends and demands, vulnerability to fluctuations in the world market, the lack of availability of qualified management personnel and stock market volatility. Details of the risk factors relating to Feronia and its business are discussed under the heading "Risks and Uncertainties" in Feronia's annual Management discussion and analysis for the year ended December 31, 2013, a copy of which is available on the Company's SEDAR profile at www.sedar.com. Most of these factors are outside the control of the Company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the Company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.

Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information