MP Evans Group PLC (AIM:MPE) shares rose 6.5% on Tuesday after the palm oil producer reported record profits and a strong balance sheet, helped by higher prices and disciplined cost control.
Revenue for 2024 climbed to $352.8 million, with operating profit jumping 54% to $115.7 million. Earnings per share rose two-thirds to 129.6p. Strong cash generation allowed the group to eliminate its net debt and finish the year with $46.4 million in cash.
The company raised its dividend by 17% to 52.5p and cancelled over 1.1 million shares through buybacks. Crude palm oil prices averaged $823 a tonne last year, up 13%, while the group focused on processing more of its own and smallholder crops at its six Indonesian mills.
Chairman Peter Hadsley-Chaplin said MP Evans remains committed to growth and sustainability, with more planting underway and further acquisitions on the radar.
Early 2025 trading has been encouraging, with strong cropping and prices averaging $870 a tonne.
The shares, up 30% in the last year, were up 62p at 1,020p in late morning trading.
Research house Cavendish upgraded its price target by 100p to 1,500p on the back of the results.
"Cash continues to pour into the business and build rapidly on the balance sheet," it said.
"This gives MP Evans increasing optionality to increase returns to shareholders via dividends and share buybacks, and to fund new land acquisitions."
Panmure Liberum moved its valuation 110p higher to 1,260p, pointing out that the stock trades on a modest seven times future earnings and yet provides a decent dividend yield of 5.5%.