Source - PRN

19 September 2016
 

LONDON NUSANTARA PLANTATIONS PLC
(London Nusantara” or the “Company”)

UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2016

CHANGE OF BUSINESS ADDRESS

I am pleased to announce our third interim financial results since the Company’s successful flotation on the ISDX Growth Market on 30 June 2014. The company completed its maiden investment on 18 March 2015 by acquiring an 11% interest in 404 hectares of land suitable for oil palm cultivation.

We are currently targeting to acquire an equity interest in oil palm estates that are revenue generating and yielding. We are currently focused on East Malaysia, where a number of opportunities have been identified and with some preliminary due diligence being undertaken to determine a suitable target. The Company intends to fund these acquisitions by raising capital through a mixture of debt and equity, simultaneously, with any acquisition targets that meet the Company’s acquisition criteria.

FINANCIALS

The interim results for the six months ended 30 June 2016 shows a loss of £25,372, mainly due to the costs associated with maintaining the listing status, which is largely made up of administrative fees and retainers to advisors.

The financial information for the six months ended 30 June 2016 has not been audited, but has been reviewed by the Company’s auditors, UHY Hacker Young LLP.

INDUSTRY OUTLOOK 2016

In the first half of 2016, palm oil prices moved on an uptrend since January, reaching a high of RM2,756 (approximately £505.00)/MT in April. This was the highest price in 18 months, as concerns over production on account of the effects of El Nino phenomenon on palm oil pushed the price upwards. However, since mid-June 2016, there has been a heavy downward pressure on palm oil prices due to the abundant supply of other competing oils, namely soybean oil. It was reported by Sue Goll Commodities Consulting Incorporated that the 2016/17 soybean production increased by a little over 2 million tonnes, with the US accounting for almost all of the increase.

It is, however, anticipated that growth in palm oil supplies and exports would be severely impacted this year as Malaysian palm oil production in the first six months of 2016 was 16% lower than the corresponding period of last year. In addition, the Malaysian Palm Oil Board reported that the Malaysian palm oil stock fell to 1.78 million tonnes in June 2016 as compared to 2.31 million tonnes in January 2016.

On the demand side, exports of Malaysian palm oil declined by 7.2% to 7.29 million tonnes against 7.86 million tonnes reported on the same period in 2015. This was primarily due to the decline in palm oil exports to the major markets, such as China (-52.3%), India (-9.6%) and EU (-13.9%), arising from higher imports of soybean, rapeseed and Indonesian palm oil.

The Malaysian Biodiesel Mandate had shown the desired results with B7 (a blend of 7% palm oil (palm, methyl and ester) and 93% diesel) Program launched in November 2014 replacing some 500,000 to 700,000 tonnes of diesel per year.  It was reported from the Malaysian Palm Oil Board that the B7 program in 2015 had a complaint-free track record of 40 million kilometers in mileage.  In July 2016, Malaysia launched the B10 (a blend of 10% palm oil) program and is expected to further take away the supply of Crude Palm Oil (“CPO”) from the market.

CIMB Securities indicated that key factors that will be driving CPO price in second half of the year are:

(1) Chinese demand;
(2) Palm oil yields;
(3) Biodiesel demand in Indonesia and Malaysia; and
(4) US soybean crops.

Chinese demand is expected to recover in the second half of the year, as the high carry-over stock needs replenishment.

Palm oil yield in Malaysia and Indonesia will see a drop of 1.8 million tonnes on the back of the El Nino weather effect.

The increase in the biodiesel mandate and palm oil competitive price will see it as the most attractive as feedstock.

As for soybean, although production is high, it is not as high as originally expected. Based on the above factors, it is forecasted that the palm oil price will average the year at RM2,680 (approximately £491.00) per metric ton trading on a wider range of RM2,200 (approximately £403.00) to RM3,100 (approximately £568.00) per metric ton.

CHANGE OF BUSINESS ADDRESS
The Company also announces that its business and correspondence address has changed to:
London Nusantara Plantations plc
Level 23, Nu Tower 2,
Jalan Tun Sambanthan
Kuala Lumpur Sentral
50470 Kuala Lumpur
 

M Subramaniam
Chief Executive Officer

19 September 2016

The Directors of the Company accept responsibility for the contents of this announcement.

For further information please contact:

The Company
LONDON NUSANTARA PLANTATIONS PLC
Manichelvam Subramaniam, Chief Executive Officer                +60 3 7865 3987
Simon Rothschild, Non-executive Director                                 +44 7703 167 065
 
ISDX Corporate Adviser                                                              +44 (0)20 7469 0930
PETERHOUSE CORPORATE FINANCE LIMITED
Mark Anwyl/Guy Miller
 



STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2016

6 Months ended 6 Months ended
30 June 30 June
2016 2015
(Unaudited) (Unaudited)
Notes £ £
Revenue - -
Cost of sales - -
_________ _________
Gross profit - -
Administration expenses (28,318) (79,254)
_________ _________
Operating loss (28,318) (79,254)
Finance income 4 2,946 5,104
_________ _________
Loss before taxation (25,372) (74,150)
Taxation 5 - -
_________ _________
Loss for the period (25,372) (74,150)
Other comprehensive income - -
_________ _________
Total comprehensive loss (25,372) (74,150)
======== ========
Loss attributable to:
Equity holders of the company (25,372) (74,150)
======== ========
Loss per share 6 (0.01)p (0.04)p
======== ========



STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016

30 June 31 December
2016 2015
(Unaudited) (Audited)
Notes £ £
Non-Current Assets
Office equipment 190 230
Investments 7 111,772 111,772
_________ _________
Total non-current assets 111,962 112,002
_________ _________
Current assets
Receivables 8 693 -
Cash and cash equivalents 9 161,535 191,097
_________ _________
Total current assets 162,228 191,097
_________ _________
Total assets 274,190 303,099
_________ _________
Current liabilities
Accruals 10 (7,495) (11,032)
_________ _________
Total liabilities (7,495) (11,032)
_________ _________
Net assets 266,695 292,067
======== ========
Capital and reserves
Share capital 11 669,438 669,438
Retained losses (402,743) (377,371)
_________ _________
Total equity 266,695 292,067
======== ========



STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED 30 JUNE 2016

6 Months ended 6 Months ended
30 June 30 June
2016 2015
(Unaudited) (Unaudited)
£ £
Operating loss (28,318) (79,254)
Adjusted for:
Depreciation 40 39
Increase in receivables (693) (525)
Decrease in payables (3,537) (25,488)
_________ _________
Net cash outflow from operating activities (32,508) (105,228)
_________ _________
Cash flow from investing activities
Interest received 2,946 5,104
_________ _________
Net cash inflow from investing activities 2,946 5,104
_________ _________
Net decrease in cash and cash equivalents (29,562) (100,124)
Cash and cash equivalents at the beginning of the period 191,097 372,476
_________ _________
Cash and cash equivalents at the end of the period 161,535 272,352
======== ========



STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2016

Share Retained Total
capital losses equity
£ £ £
As at 1 January 2015 659,438 (211,665) 447,773
Loss for the year - (165,706) (165,706)
Shares issued in the year 10,000 - 10,000
_________ _________ _________
At 31 December 2015 669,438 (377,371) 292,067
======== ======== ========
Loss for the period - (25,372) (25,372)
_________ _________ _________
At 30 June 2016 669,438 (402,743) 266,695
======== ======== ========






NOTES TO THE FINANCIAL INFORMATION
FOR THE PERIOD ENDED 30 JUNE 2016

1.         Significant accounting policies

1.1       Basis of preparation

            This interim financial information for the six months ended 30 June 2016 is unaudited and does not constitute statutory accounts within the meaning of the Companies Act 2006 (Isle of Man).  It was approved by the board of directors on 8 September 2016.

            The figures for the year ended 31 December 2015 have been extracted from the statutory accounts which have been prepared in accordance with International Financial Reporting Standards, as adopted by the European Union, (“IFRS”) and which have been reported on by the company’s auditor.  The auditor’s report on those financial statements was unqualified.

            The half-year report is a general purpose financial statement, which has been prepared in accordance with the requirements of IAS 34 “Interim financial reporting”.

            The half-year financial report does not include all notes of the type normally included in the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the group as the full financial report.

            The financial information has been prepared on the historical cost basis. The accounting policies and methods of computation adopted in the company’s preparation of the half-year financial report are consistent with those adopted and disclosed in the financial statements for the year ended 31 December 2015 and those expected to be used for the year ending 31 December 2016.  The principal accounting policies adopted are set out below.

1.2       Going concern

            On admission to ISDX on 30 June 2014, the company raised £532,428 in gross proceeds from a share placing, of which net proceeds after costs of the IPO of £452,160 were received. As part of the admission process, the directors prepared detailed working capital forecasts to ensure that the company would have sufficient funds available for the foreseeable future.

            Having reviewed the company’s forecasts, the directors believe that the company is well placed to manage its business risks successfully. Thus, they have adopted the going concern basis in preparing this interim financial information.

1.3       Foreign currencies

            The results and financial position of the company are expressed in Pounds Sterling (£) which is the presentation currency for the company financial statements. The functional currency of the company is the Malaysian Ringgit (RM) which is the currency of the environment in which the company principally operates. At the end of the period, the exchange rate applying to these financial statements was £1 = RM5.4353

            The assets and liabilities of the company’s foreign operations are translated at exchange rates prevailing on the date of the accounts. Income and expense items are translated at exchange rates ruling at the date of the transactions. Exchange differences arising, if any, are classified as income or as expenses in the period in which they arise.

LONDON NUSANTARA PLANTATIONS PLC

NOTES TO THE FINANCIAL INFORMATION

FOR THE PERIOD ENDED 30 JUNE 2016

1.4       Investments

            Investments are stated at cost less any provision for impairment.

1.5       Trade and other receivables

            Trade and other receivables are carried at original invoice amount less provision made for impairment of these receivables. A provision for impairment of trade and other receivables is established when there is objective evidence that the company will not be able to collect all amounts due according to the original terms of the receivables. The amount of the provision is the difference between the assets’ carrying amount and the recoverable amount. Provisions for impairment of receivables are included in the income statement.

1.6       Trade and other payables

            Trade and other payables represent liabilities for goods and services provided to the company prior to the financial year, which are unpaid. Current liabilities represent those amounts falling due within one year.

1.7       Taxation

Deferred tax is provided in full using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination, which at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred tax is determined using tax rates that are expected to apply when the related deferred tax asset is realised or when the deferred tax liability is settled. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

2.         Critical accounting judgements and estimates

The preparation of financial statements in conformity with International Financial Reporting Standards requires the use of accounting estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Although these estimates are based on management’s best knowledge of current events and actions, actual results ultimately may differ from those estimates.

Management believes that there are no areas that involve a high degree of judgement or complexity, or areas where assumptions and estimates are significant to these financial statements.

3.         Segmental information

The company’s assets and activities are based in Malaysia within the palm oil investment sector. This is the only business segment in which the company operates as identified by management.

LONDON NUSANTARA PLANTATIONS PLC

NOTES TO THE FINANCIAL INFORMATION

FOR THE PERIOD ENDED 30 JUNE 2016

4. Finance income 6 Months ended 6 Months ended
30 June 30 June
2016 2015
£ £
Bank interest received 2,946 5,104
======== ========

   

5. Taxation 6 Months ended 6 Months ended
30 June 30 June
2016 2015
£ £
Current tax - -
Deferred tax - -
======== ========

No reconciliation of the factors affecting the tax charge has been presented as the company is incorporated in the Isle of Man which has a corporation tax rate of 0%.

6.         Loss per share

            The basic loss per share of (0.01)p for the company is calculated by dividing the loss for the  period by the weighted average number of ordinary shares in issue of 180,458,336

7.         Investments
30 June 31 December
2016 2015
£ £
Net book value 111,772 111,772
======== ========

Next Oasis was incorporated on 25 November 2014 for the purpose of acquiring two companies that together held 404.6 hectares of vacant land in Malaysia, which are suitable for oil palm cultivation. On 18 March 2015, the company completed the acquisition of the 11% interest in the 404.6 hectare of oil palm from MWE Holdings Berhad, through Next Oasis.

LONDON NUSANTARA PLANTATIONS PLC

NOTES TO THE FINANCIAL INFORMATION

FOR THE PERIOD ENDED 30 JUNE 2016

8.         Receivables 30 June 31 December
2016 2015
£ £
Other receivables 693 -
======== ========

9.         Cash and cash equivalents                                                                                                         

Cash and cash equivalents comprise cash held at bank.  The carrying amount of these assets is approximately equal to their fair value.

10.       Payables 30 June 31 December
2016 2015
            Accruals 7,495 11,032
======== ========

11.       Share capital

Number of
shares £
As at 31 December 2015 and 30 June 2016 180,458,336 669,438
======== ========

12.       Related party transactions

No related party transactions have taken place during the period.

13.       Subsequent events

No significant event has taken place since 30 June 2016 up to the date of the release of this interim report.