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Anglo-Eastern Plantations (AEP)

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Falling palm oil prices slowing Anglo-Eastern

22 Jun 11

LONDON (ShareCast) - Indonesian and Malaysian palm oil producer Anglo-Eastern Plantations issued a cautiously confident update at its annual general meeting on Wednesday, noting that crude oil palm oil prices at the end of May were more than a tenth lower than at their February high.

The company said that fresh fruit bunches (FFB) production in the first five months of the year totalled 258,000 tonnes (metric tons), up 23% on the 209,300 tonnes produced in the first five months of last year.

FFB bought in totalled 209,300 tonnes, 28% higher in comparison with the same period in 2010. Total Crude Palm Oil (CPO) produced was 92,500 tonnes, up 25% year-on-year, mainly due to better FFB yield from favourable weather and an increase in FFB bought in.

The average price of CPO on a cost, insurance and freight (CIF) basis in Rotterdam over the first five months of 2011 was $1,208 per tonne, up 48% on the average price in the corresponding period of 2010.

However, since hitting a peak of $1,335 per tonne in February, the CPO price had fallen 11% to $1,183 at the end of May, due to higher FFB production. However, the group believes high crude oil prices and the widening discount between CPO prices and soy bean oil prices should provide near-term support to the crude palm oil price.

While the price of CPO has subsided, the Indonesian Rupiah has strengthened against the US dollar. To mitigate exposure to currency exchange volatility, the group is continuing to manage its cash in dollar and local currency prudently, taking into consideration its dollar-denominated borrowings and operational cost currency requirements.

"As the commodities price has been generally stable throughout this period and the demand for the group's products remains strong, the board is cautiously confident of reporting a satisfactory profit level and cash flow for the remainder of 2011," the group's chairman, Lim Siew Kim, said.

At 11:57am (22/6/11), the share price of Anglo-Eastern was trading at 741.5p in London, down 8.5p on the day.


Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.


Market Data

Currency UK Pounds
Price 577.00p
Change Today 2.00p
52 Week High 617.00p
52 Week Low 427.50p
Volume 11,855
Shares Issued 39.64m
Market Cap 228.70m


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