Sign up UNITED KINGDOM
Proactive Investors - Run By Investors For Investors

UPDATE - DekelOil production rises 151%

Output was 35,770 tonnes of crude palm oil, a year on year increase of 151%; sales were up 156%.
UPDATE - DekelOil production rises 151%
Dekel attributed the success to a strong relationship with local growers.

---ADDS BROKER COMMENT & SHARE PRICE---

DekelOil (LON:DKL) hailed an ‘excellent’ first full year of production for its Ayenouan palm oil plant in Côte d'Ivoire.

Output was 35,770 tonnes of crude palm oil, a year on year increase of 151%; sales were up 156%.

Kernal production was equally impressive at 6,221 tonnes, representing a year on year rise of 148%; sales almost doubled.

Dekel achieved €604 a tonne for its palm oil, down 7%. That said this still represents a premium to the benchmark Rotterdam-quoted price.

And with the impact of the unusually strong El Nino leading to low rainfall in south-east Asia, the traditional producing region, industry output is falling and prices are rising. This trend is expected to continue into the new year, Dekel said.

DekelOil director Lincoln Moore said the company would build on the success of 2015, with production expected to grow further.

He attributed the current success to a strong relationship with local growers who supply its 51%-owned Ayenouan operation. In particular the logistics have been very effective, he said.

As the business expands Dekel also plans to take more crop from the company-owned estate, which should boost its profit margins.

"Together with the recently announced €5.1 million reduction in debt, we are on course to realise the highly cash generative potential of our vertically integrated project at Ayenouan,” Moore said.  

Shares, up 28% in the last three months, advanced 3% to 1.28p each, valuing Dekel at £19.5mln.

The broker Cantor Fitzgerald reckons the stock has a lot further to go based on its 2p price target.

Repeating his 'buy' advice, analyst Adam Forsyth said: "The principal risk to this valuation would be further weakness in the CPO price. However the likely impact of El Nino on production in Malaysia and Indonesia suggest that pricing is more likely to firm into 2016."

 

View full DKL profile View Profile

Dekeloil Public Ltd Timeline

Article
January 17 2017
Newswire
January 16 2017

Related Articles

Planks of wood
July 03 2017
Obtalafound on numerous occasions that the WoodBois team had been very conservative in its estimates and projections.

No investment advice

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable or advisable for any specific person. You further understand that none of the information providers or their affiliates will advise you personally concerning the nature, potential, advisability, value or suitability of any particular security, portfolio of securities, transaction, investment strategy, or other matter.

You understand that the Site may contain opinions from time to time with regard to securities mentioned in other products, including company related products, and that those opinions may be different from those obtained by using another product related to the Company. You understand and agree that contributors may write about securities in which they or their firms have a position, and that they may trade such securities for their own account. In cases where the position is held at the time of publication and such position is known to the Company, appropriate disclosure is made. However, you understand and agree that at the time of any transaction that you make, one or more contributors may have a position in the securities written about. You understand that price and other data is supplied by sources believed to be reliable, that the calculations herein are made using such data, and that neither such data nor such calculations are guaranteed by these sources, the Company, the information providers or any other person or entity, and may not be complete or accurate.

From time to time, reference may be made in our marketing materials to prior articles and opinions we have published. These references may be selective, may reference only a portion of an article or recommendation, and are likely not to be current. As markets change continuously, previously published information and data may not be current and should not be relied upon.

© Proactive Investors 2017

Proactive Investor UK Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use