a n n u a l
r e p o r
t
2008
Contents
Financial Highlights
Chairman's Statement
Financial Record
Estate Areas
Location of Estates
Business Review
Directors' Report
Directors' Responsibilities
Directors
Statement on Corporate Governance
Directors' Remuneration Report
Auditors' Report
Consolidated Income Statement
Consolidated Statement of Recognised Income and Expense
Consolidated Balance Sheet
Consolidated Cash Flow Statement
Notes to the Consolidated Financial Statements
Company Balance Sheet
Notes to the Company Financial Statements
Notice of Annual General Meeting
1
2
5
6
7
8
10
14
15
16
18
20
21
22
23
24
26
47
48
50
Form of Proxy and Attendance Card separate attachment
Company addresses, advisers and website inside back cover
Anglo-Eastern Plantations Plc, quoted on the London Stock Exchange,
owns, operates and develops plantations in Indonesia and Malaysia,
amounting to some 132,000 hectares producing mainly palm oil and some
rubber.
Financial Highlights
Revenue
Profit before tax
- before biological asset (BA) adjustment
- after BA adjustment
EPS before BA adjustment
EPS after BA adjustment
Dividend (cents)
Dividend (pence)
Note: * Based on exchange rate at 7 April 2009 of $1.4751/£
2008
$ m
2007
$ m
174.7
127.9
76.5
77.9
52.6
53.6
103.0cts
105.1cts
5.0cts
*3.4p
77.2cts
78.5cts
14.0cts
7.0p
Anglo-Eastern Plantations Plc I Annual Report 2008
Chairman’s Statement
Results
I am pleased to report a record profit for 2008 which was largely attributable to both higher average Crude
Palm Oil (CPO) prices and production volume. Equally important, the group has expanded its total landholding
to 132,000 ha, a 50% increase in landholding from 2007. Out of this, 40,000 ha are planted and 63,000 ha
are available for planting. With a measured land clearing and planting programme, the group will be able to
double its planted area in the next five years.
Group operating profit for 2008, before biological asset (BA) adjustment, was $74.1 million, 41% more than
2007. Estate fresh fruit bunch (FFB) output for 2008 was 7% above the previous year. The increase is attributed
by higher overall productivity and larger mature hectarage.
Profit before tax and after BA adjustment was $77.9 million, compared to $53.6 million in 2007. The BA
adjustment was a credit of $1.3 million, compared to $1.0 million in 2007, reflecting our estate valuations
referred to in the following “Business Review” section. However, note that the BA adjustment has no bearing
on cash generation of the group.
Earnings per share before BA adjustment increased by 33% to 103.0 cts, compared to 77.2 cts in 2007.
Financing
Our policy is to fund the group’s operations, capital expenditure and development from internally generated
funds or from the drawdown of existing bank loans. The group is confident additional loan facilities can be
obtained, should the necessity arise. For the two acquisitions announced in 2008, described below under
‘Recent acquisitions’, amounting to $11.4 million, this was mainly funded via internally generated funds. Capital
expenditure is planned for two new mills at Cahaya Pelita Andhika (CPA), North Sumatra and in Sumindo
estate, Bengkulu, amounting to $20.5 million. The construction of the mill in Sumindo estate, Bengkulu, has
started and is expected to be completed by 2010.
During the year, we repaid $4.2 million of our existing borrowings. There were no new borrowings.
The group’s balance sheet remains strong. The group continued to experience strong cash flow generation for
2008, enabling it to have higher cash reserves and reduce its borrowings. As at 31 December 2008, the group
had a cash position of US$69.4 million and lower borrowings of $35.6 million, giving it a net cash position of
$33.8 million, compared to $23.3 million in 2007.
Our policy is to continue seeking to purchase mature and immature land to increase total landholdings.
Recent acquisitions
In 2008, the group acquired a 95% equity interest in PT Riau Agrindo Agung (RAA), an Indonesian company
owning the rights to 15,000 ha of vacant land in Bengkulu, and a 95% equity interest in PT Empat Lawang
Agro Perkasa (ELAP) and PT Karya Kencana Sentosa Tiga (KKST); two Indonesian companies which hold
the rights to 14,100 ha and 16,000 ha respectively in South Sumatra. The total addition of 45,100 ha brings
the group’s total landholding to 132,000 ha from 86,900 ha in the previous year. While these new properties
are all evidenced by official “rights to occupy” (a temporary title which precedes application for and grant of
a full land title or Hak Guna Usaha (HGU)), they require detailed surveys. In addition to identifying plantable
areas, this survey involves an assessment of the areas that ought to be set aside for local community use.
With land available for commercial and private agriculture becoming increasingly scarce in Indonesia, this is
an important and sensitive issue.
The peak net development cost of the total plantable area of about 63,000 ha, including the above acquisitions,
is likely to be about $170 million to be spread over a period of five to ten years.
Anglo-Eastern Plantations Plc I Annual Report 2008
Chairman’s Statement
Directors
The Board had undergone rejuvenation in terms of new appointments to replace long-serving directors.
Mr Peter O’Connor and Mr Ho Soo Ching, two of our long-serving independent non-executive directors, have
retired subsequent to our twenty third annual general meeting on 31 July 2008. Mr. David Smith resigned on
4 March 2009. Datuk H Chin Poy-Wu, our long-serving independent non-executive director, will be retiring at
the forthcoming annual general meeting and will not be seeking re-election. The Board thank these directors
for their service.
I am pleased to welcome the appointment of Mr. Donald Han Low as Acting Chief Executive Officer with effect
from 26 August 2008 as well as Mr. Nik Din Nik Sulaiman as an independent non-executive director with effect
from 1 April 2009. Brief profiles of the directors are set out in a subsequent section of this Annual Report.
Both Mr. Donald Han Low and Mr. Nik Din Nik Sulaiman are submitting themselves for re-appointment by
shareholders at the forthcoming annual general meeting.
Madam Lim Siew Kim, our non-executive director, will submit herself for re-election at the forthcoming annual
general meeting.
I will submit myself for re-appointment by the shareholders at that same annual general meeting.
Outlook
Fresh Fruit Bunch (FFB) production as of February 2009 has been satisfactory in all estates and comparable
to the same period in 2008. It is too early to forecast whether the performance can be sustained for the rest
of the year.
The CPO price opened the year at $962.5/mt and ended the year at $495/mt, averaging $945/mt for the year.
Since its peak of $1,420/mt achieved in March 2008, CPO price has fallen back sharply and hit a low of $455/
mt in October 2008. This significant price adjustment of a 68% drop from its peak is not unlike the sharp drop
across the board experienced by other vegetable oil and commodities, especially crude oil.
In response to the sharp fall in CPO price, prevalent in the second half of 2008, the Indonesian government
has annulled the export tax on CPO to zero with effect from 1 November 2008. The resulting tax saving has
cushioned the impact of the CPO price decline, and this calming effect can be seen by the CPO price strongly
supported around $460/mt and $520/mt price band. Since January 2009, CPO prices have been steadily
trading in the range of $495/mt and $620/mt. The industry generally feels that a long term sustainable price
is around $600/mt-$700/mt.
The US dollar appreciated by approximately 25% against the Indonesian Rupiah in 2008, and this had an
impact in terms of an unrealised exchange loss on the exchange reserve position. The Indonesian Rupiah
has not experienced adverse fluctuations against the US dollar during early 2009 and we expect a satisfactory
exchange level to be attainable for the rest of the year. To mitigate exposure to currency exchange volatility,
the group is managing its cash in dollars and local currencies prudently, taking into consideration its dollar-
denominated borrowings and operational cost currencies requirements.
Prospects for 2009 will be challenging in view of the lower CPO price and the global recession. Market perception
is that Indonesia will remain economically stable, in spite of the global recession, and this is expected to bode
well as demand for basic foodstuff, such as cooking oil in the domestic market, may continue to sustain. The
group is confident that demand for its product will be sustainable and we can expect a satisfactory profit level
and cash flow for 2009.
Anglo-Eastern Plantations Plc I Annual Report 2008
Chairman’s Statement
Dividend
The board is mindful that the group’s development programme will require a considerable capital commitment.
In this respect, the dividend level needs to be balanced against the planned capital expenditure. The board is
proposing to declare a final dividend of 5.0 cts in respect of 2008, representing a reduction of 64% from 14.0
cts in respect of 2007. Shareholders choosing to receive their dividend in sterling will do so at the rate ruling
on 26 June 2009, when the register closes. Based on the exchange rate at 7 April 2009 of $1.4751/£, the
proposed dividend would be equivalent to 3.4p, compared to 7.0p declared in respect of 2007.
CHAN TEIK HUAT
Chairman
15 April 2009
Anglo-Eastern Plantations Plc I Annual Report 2008
Financial Record
Income statement
Revenue
Trading profit
Biological asset (BA) movement
Exchange profits/(losses)
Net finance income/(expense)
Profit before tax
Tax
Minority interests
2008
IFRS
$000
2007
IFRS
$000
2006
IFRS
$000
2005
IFRS
$000
2004
IFRS
$000
174,684 127,898
52,521
1,001
215
(145)
74,064
1,347
1,503
959
79,094
26,270
2,312
368
90
64,321
22,201
(35)
(550)
(196)
65,676
24,934
1,950
147
(287)
77,873
(25,891)
(9,981)
53,592
(15,628)
(6,964)
29,040
(9,289)
(3,277)
21,420
(7,097)
(2,140)
26,744
(9,034)
(2,901)
Profit attributable to shareholders
42,001
31,000
16,474
12,183
14,809
Dividend proposed for year
(1,973)
(5,524)
(4,266)
(3,514)
(3,147)
Balance Sheet
$000
$000
$000
$000
$000
Fixed assets
Cash net of short term borrowings
Long term loans
Other working capital
Deferred tax
Minority interests
Net worth
Share capital
Treasury shares
Share premium and
capital redemption account
Revaluation and exchange reserve
Profit and loss account
198,855 187,023 160,823 129,518 127,302
9,357
15,079
(5,558)
(5,454)
(4,341)
(1,919)
(16,698)
(21,152)
9,091
(3,940)
255
(16,941)
59,065
(35,719)
(8,979)
(23,052)
60,803
(27,025)
(11,894)
(28,450)
192,289 178,338 147,377 117,983 110,062
(19,276)
(25,421)
(31,558)
(32,367)
(20,519)
160,731 145,971 121,956
97,464
90,786
15,504
(1,785)
15,504
(1,785)
15,495
(1,387)
15,481
(1,387)
15,424
(1,387)
25,022
25,022
46
(22,083)
144,073 107,184
24,991
2,407
80,450
24,955
(9,121)
67,536
24,912
(6,674)
58,511
Equity attributable to shareholders’ funds
160,731 145,971 121,956
97,464
90,786
Ordinary shares in issue (‘000s)
Earnings per share before BA adjustment (US cents)
Earnings per share after BA adjustment (US cents)
Dividend per share for year (US cents)
Asset value per share (US cents)
Earnings per share before BA adjustment (pence equivalent)
Dividend per share for year (pence)
Asset value per share (pence equivalent)
Exchange rates – year end
Rp : $
$ : £
RM : $
Exchange rates – average
Rp : $
$ : £
RM : $
39,976
103.0cts
105.1cts
5.0cts
402cts
55.9p
3.4p
285p
10,950
1.41
3.48
9,735
1.84
3.34
39,976
77.2cts
78.5cts
14.0cts
370cts
38.4p
7.0p
186p
9,419
1.99
3.31
9,170
2.01
3.43
39,958
38.3cts
41.7cts
10.8cts
309cts
20.6p
5.5p
158p
9,020
1.96
3.53
9,141
1.86
3.66
39,928
31.0cts
30.9cts
8.8cts
244cts
17.1p
5.0p
142p
9,830
1.72
3.78
9,751
1.81
3.79
39,804
34.5cts
n/a
8.0cts
228cts
18.7p
4.3p
135p
9,290
1.92
3.80
9,001
1.84
3.80
Anglo-Eastern Plantations Plc I Annual Report 2008
a
H
0
0
0
1
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
7
1
3
4
9
,
4
0
0
2
1
0
6
9
,
4
0
0
0
0
0
0
6
9
,
4
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
)
a
(
%
5
9
%
5
9
%
0
8
%
5
9
%
5
9
%
5
9
%
0
9
%
0
9
%
0
9
%
5
7
%
0
0
1
%
5
7
%
0
8
%
0
0
1
%
0
8
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
a
H
M
G
S
L
M
B
a
n
B
i
i
r
t
i
P
a
r
t
a
m
u
S
h
t
u
o
S
a
y
a
h
a
C
i
g
n
d
u
P
a
t
i
l
e
P
i
e
g
n
u
S
n
a
h
u
b
a
L
k
a
n
A
A
A
R
P
A
L
E
T
S
K
K
o
n
A
l
s
a
M
i
a
k
h
d
n
A
m
a
s
u
M
g
n
u
b
m
a
R
n
a
h
a
k
n
a
B
k
l
l
i
B
i
k
s
a
T
i
k
s
a
T
g
n
u
r
e
d
n
e
C
-
I
L
A
K
N
A
T
N
A
M
A
K
G
N
A
B
U
A
R
I
U
L
U
K
G
N
E
B
A
R
T
A
M
U
S
H
T
R
O
N
I
A
S
E
N
O
D
N
I
P
U
O
R
G
L
A
T
O
T
I
A
S
Y
A
L
A
M
L
A
T
O
T
s
a
e
r
A
e
t
a
t
s
E
5
0
6
,
9
8
2
5
,
1
9
2
5
0
0
0
3
9
9
0
0
0
0
0
0
3
3
6
,
3
8
7
3
,
1
8
0
8
,
1
9
4
1
7
1
9
0
9
4
3
9
4
1
,
3
0
0
0
9
5
4
9
8
,
1
2
5
8
,
4
6
6
7
7
4
9
,
5
6
4
1
,
9
2
0
0
0
0
0
0
0
0
0
0
0
0
6
0
4
0
7
2
6
7
6
0
0
0
0
0
0
0
0
0
0
0
0
6
0
4
0
7
2
6
7
6
0
0
0
6
0
4
0
7
2
6
7
6
2
6
6
,
1
1
3
3
6
,
3
1
7
3
,
2
8
0
8
,
1
9
4
1
7
1
9
8
9
4
,
3
6
6
7
6
0
0
,
6
2
9
8
,
5
3
6
9
6
,
3
8
8
5
,
9
3
%
5
5
a
H
0
1
7
2
5
2
4
,
3
)
a
H
(
s
e
r
a
t
c
e
H
5
6
1
,
2
2
5
8
,
4
1
7
5
,
2
3
0
)
a
(
0
0
0
,
8
0
9
8
,
7
1
0
)
a
(
0
0
0
,
6
0
0
0
,
3
0
6
7
7
6
0
)
a
(
0
0
5
,
4
8
8
4
,
0
1
)
a
(
0
0
8
,
9
0
0
3
,
4
0
0
8
,
4
8
3
6
6
6
5
0
0
2
,
1
1
9
2
4
,
1
0
9
0
2
2
8
4
0
8
4
8
7
5
1
,
3
0
0
6
1
1
0
9
8
,
5
2
0
0
0
,
9
3
4
1
8
8
4
,
4
1
0
0
1
,
4
1
0
0
0
,
6
1
3
3
6
,
2
1
9
6
1
2
3
,
3
6
1
1
0
7
2
4
2
1
5
0
3
7
3
0
4
5
8
3
1
9
1
3
6
8
,
1
0
0
1
3
9
3
4
,
2
1
3
0
8
1
2
7
0
9
7
2
8
,
1
6
6
3
0
,
6
2
0
7
6
,
1
5
8
6
2
5
1
6
0
,
2
8
8
8
,
3
6
2
6
5
,
6
2
5
5
7
,
1
3
3
5
,
9
8
2
7
6
,
2
5
0
2
,
2
9
l
e
b
a
t
n
a
p
n
U
l
l
e
b
a
t
n
a
P
l
r
e
h
t
O
2
6
6
,
1
1
3
3
6
,
3
1
7
3
,
2
8
0
8
,
1
5
2
8
7
1
9
8
9
4
,
3
6
6
7
6
0
0
,
6
8
6
5
,
6
3
6
9
6
,
3
4
6
2
,
0
4
a
e
r
a
d
e
t
n
a
p
l
l
a
t
o
T
s
e
v
r
e
s
e
R
0
0
0
,
6
2
0
0
0
,
9
3
0
1
,
5
0
0
0
,
5
1
0
0
1
,
4
1
0
0
0
,
6
1
5
9
2
,
4
1
4
2
3
,
4
2
9
6
,
5
4
2
9
,
1
6
7
8
7
5
9
7
3
9
,
5
7
9
7
6
9
0
,
6
1
0
1
,
6
2
1
8
6
3
,
6
9
6
4
,
2
3
1
9
0
0
2
h
c
r
a
M
1
3
t
a
a
e
r
a
l
a
t
o
T
0
0
9
2
3
,
4
0
0
0
2
9
2
,
3
1
4
2
3
,
4
9
6
4
,
4
4
2
9
,
1
6
7
8
7
5
9
7
5
5
,
3
1
9
7
6
4
9
,
5
5
6
4
,
0
4
8
6
3
,
6
3
3
8
,
6
4
0
0
0
,
6
2
0
0
0
,
9
4
7
7
0
0
0
,
5
1
0
0
1
,
4
1
0
0
0
,
6
1
3
0
0
,
1
0
3
2
2
,
1
0
0
0
0
8
3
,
2
6
0
5
1
6
3
6
,
5
8
0
6
3
6
,
5
8
s
e
l
t
i
t
d
n
a
L
i
h
c
h
w
f
o
s
t
h
g
i
r
d
n
a
L
l
a
t
o
t
f
o
%
0
7
t
a
d
e
t
a
m
i
t
s
e
e
r
a
s
a
e
r
a
e
b
a
t
n
a
p
l
l
e
t
a
m
i
t
l
u
,
7
0
0
2
d
n
a
8
0
0
2
n
i
i
s
n
o
i
t
i
s
u
q
c
a
w
e
n
r
o
F
)
a
(
:
e
t
o
N
s
a
e
r
a
l
a
t
o
t
n
i
t
s
e
r
e
t
n
i
p
u
o
r
G
w
o
l
e
b
8
0
0
2
r
e
b
m
e
c
e
D
1
3
t
a
d
e
t
n
a
l
P
m
l
a
P
l
i
O
e
r
u
t
a
M
9
0
0
2
d
n
e
e
r
u
t
a
m
o
t
e
u
d
e
r
u
t
a
m
m
I
r
e
b
b
u
R
e
r
u
t
a
M
e
r
u
t
a
m
m
I
l
a
t
o
T
r
e
h
t
o
l
a
t
o
T
Anglo-Eastern Plantations Plc I Annual Report 2008
s
e
t
a
t
s
E
f
o
s
n
o
i
t
a
c
o
L
m
a
s
u
M
i
e
g
n
u
S
g
n
u
r
e
d
n
e
C
k
i
l
i
B
n
a
h
u
b
a
L
a
t
i
l
e
P
a
y
a
h
a
C
n
a
h
a
k
n
a
B
l
g
n
u
b
m
a
R
i
k
s
a
T
k
a
n
A
i
r
t
i
P
a
n
B
i
i
k
s
a
T
s
e
t
a
t
s
e
l
u
u
k
g
n
e
B
L
M
B
M
G
S
A
A
R
P
A
L
E
T
S
K
K
.
1
.
2
.
3
.
4
.
5
.
6
.
7
.
8
.
9
.
0
1
.
1
1
.
2
1
.
3
1
.
4
1
.
5
1
Anglo-Eastern Plantations Plc I Annual Report 2008
Business Review
Commodity Prices
2008 has been an exceptionally volatile year for vegetable oil prices, including CPO. The CPO price opened
the year at $962.5/mt and continued to creep upwards before hitting its peak of $1,420/mt in March 2008. CPO
price was steadily high until June 2008, when it fell back sharply and hit a low of $455/mt in October 2008.
The sharp drop in CPO price is in correlation with falls experienced by other vegetable oil and commodities,
especially crude oil. The CPO price ended the year at $495/mt, averaging $945/mt for the year. Pricing in
CPO is the result of a complex relationship between competing oils and meals, oil seed production in both
hemispheres, and as can be seen correlates to a certain extent with crude oil due to its biodiesel potential.
In the early half of 2008, the Indonesian government, in order to curb commodity-driven inflation, reformulated
the export taxes on CPO to a scale tax rate ranging from 5% to 25% for Rotterdam CIF prices commencing
from $650/mt. However, in response to the sharp drop in CPO price, of which Rotterdam CIF price dropped to
its lowest of $455/mt in October 2008, the Indonesian government annulled the export tax on CPO to zero with
effect from 1 November 2008. While we do not export CPO, this tax saving is passed back to producers and
reduces the domestic ex-factory prices directly. The resulting tax saving cushioned the impact of the CPO price
decline, and this calming effect can be seen by the CPO price trading between $460/mt and $520/mt since.
Rubber prices averaged $2,500/mt for 2008 (2007-$2,100/mt). Our small area of 409 ha of mature rubber
contributed a pre-tax profit of $2.1 million in 2008. The newly planted 270 ha of rubber is expected to start
production in 2011.
Valuation
In 2007 the main valuation assumptions were changed to reflect the improving outlook for palm oil and for
Indonesia, and also to reflect increasing operating costs. In 2008, we have maintained the CPO price assumption
at $500/mt and the discount rate is unchanged at 12%.
Indonesia
FFB production in North Sumatra, which aggregates the estates of Tasik, Anak Tasik, Labuhan Bilik, Blankahan,
Rambung, Sungai Musam and CPA, produced 261,000mt in 2008, 1% higher than 2007. The small increase
is encouraging, considering the mature age of the trees in Tasik, which ordinarily would become less yielding
as the trees grow older. To counter this, the group has begun a small amount of planting young plants. Tasik
contributed 60% of the total production in North Sumatra estates. Bought-in crop at 206,000mt was 29% more
than 2007. The oil extraction rates at Tasik and Blankahan mills were 21.14% (2007: 20.7%) and 21.67%
(2007: 21.9%) in 2008.
FFB production in Bengkulu (South Sumatra), which aggregates the estates of Puding Mas and Alno as well
as three newly acquired land of KKST, ELAP and RAA, produced 186,000mt, 9% higher than the previous
year. The absence of a more pronounced drought effect compared to last year, coupled with the improved
road infrastructure, contributed to this improved performance. Bought-in crop increased to 128,000mt from
117,000mt, but extraction rates for Bengkulu mill fell back to 20.5% in 2008 from 20.9% in 2007. The second
40/60mt/hr oil mill costing $10 million, located at Sumindo estate, one of the outlying estates, is currently under
construction and once completed it is expected to result in saving in transport costs as well as procuring more
bought-in crop from smallholders.
FFB production in the Riau region, comprising Bina Pitri estates, produced 79,000mt in 2008, 31% higher
than 2007. The improved performance resulted from productivity arising from a fertilisation and rehabilitation
programme started in 2005/6, immediately after Bina Pitri was acquired. Bought-in crop reached 109,000mt,
almost double the 55,000mt bought-in in the previous year, as a result of the new mill operating at higher
capacity. The extraction rates for Bina Pitri mill decreased slightly to 21.0% in 2008 from 21.2% in 2007, mainly
due to a higher proportion of bought-in crops.
Anglo-Eastern Plantations Plc I Annual Report 2008
Business Review
Malaysia
FFB production in 2008, at 40,185mt, was 2% above 2007. This is encouraging after a disappointing 11%
drop experienced in 2007. The favourable CPO prices in the first half of 2008, enabled the Malaysian estates
to contribute pre-tax profit of $1.8 million, 22% lower than 2007. By the end of 2008, the Malaysian subsidiary
had cash of $5.5 million with no external debt.
Existing development
As announced earlier in our interim statements in 2008, two new mills were planned to be built, one at CPA in
North Sumatra and the other at Sumindo estate in Bengkulu. Construction of the mill for the Sumindo estate is
progressing well. The construction of a new mill at CPA has been deferred to enable the group to re-prioritise
its resources and until investment return visibility becomes clearer.
In North Sumatra, an additional 2,000 ha have been planted in Labuhan Bilik and CPA. In Bengkulu, the 2,000
ha that were earmarked to be planted in 2008, have been deferred to 2009 by the slow progress caused by
protracted compensation negotiations with neighbouring villages. It is important these are handled carefully
and fairly. It is expected the land clearing and planting for Bengkulu will be completed by December 2009.
Land compensation and clearing, which usually takes 1 to 2 years, is progressing smoothly and steadily in
new areas in Kalimantan.
Acquisitions
As explained in the interim statements in 2008, the group made two further land acquisitions in Indonesia.
1.
Bengkulu
In January 2008, the group acquired for, a cash consideration of $3.7 million, a 95% interest in PT Riau Agrindo
Agung (RAA), an Indonesian company owning the rights to 15,000 ha of vacant land in Bengkulu. The balance
5% interest in RAA is held by the vendor, who is also the minority shareholder of PT Sawit Graha Manunggal
(SGM), one of the group’s Indonesian subsidiaries. The location is about 120 kilometres south of the group’s
existing properties in Bengkulu (“old” Bengkulu) and 60 kilometres north of the provincial capital, Bengkulu
town. It will therefore make a natural addition to the group’s existing 15,000 planted hectares and, in its early
years, will have the support of existing nurseries and access to the group’s existing mills.
Terrain on this property is hilly, but better than that of the “old” Bengkulu properties. Soils are good and rainfall
is suitable for oil palm. Vegetation is scrub and light secondary forest, the original forest having been removed
some years ago. As for the other properties, the area is zoned for development but contains villages whose
own development needs must be met. Limited planting began in 2008, with significant planting commencing
in 2009. This is due for completion by 2013, with production commencing immediately in the same year.
2.
South Sumatra
In June 2008 the group acquired a 95% interest in PT Empat Lawang Agro Perkasa (ELAP) and PT Karya
Kencana Sentosa Tiga (KKST); two Indonesian companies which hold the rights to 14,100 ha and 16,000 ha
respectively in South Sumatra. Consideration was $7.7 million in cash. The balance 5% interest in both ELAP
and KKST is held by the vendor, an Indonesian national. The area is only 125 km from Bengkulu town and
near enough to our other Bengkulu estates for FFB to be transported there prior to building a mill.
Terrain on this property is quite similar to RAA and better than that of the “old” Bengkulu properties. Soils
are good and rainfall is suitable for oil palm. Vegetation is scrub and secondary forest. The area is zoned
for agricultural development but contains small villages to which some land will be allocated for community
development. The group is currently undertaking assessment of the planting programme.
Conversion of the land rights in Bengkulu and South Sumatra to full HGU titles is likely to take two to three
years.
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Report
The directors present their annual report on the affairs of the group, together with the financial statements and
auditors’ report, for the year ended 31 December 2008.
Principal activity
The company is incorporated in the United Kingdom under the Companies Act 1985. The address of the
registered office is on the inside back cover.
The company acts as a holding company and co-ordinates the businesses of its subsidiaries. At 31 December
2008 these comprised principally the cultivation of oil palm and rubber in Indonesia and Malaysia. The subsidiary
undertakings which principally affected the profits or net assets of the group in the year are listed in note 28
to the consolidated financial statements.
Results and dividends
The audited financial statements for the year ended 31 December 2008 are set out on pages 21 to 49. The
group profit for the year on ordinary activities before taxation was $77,873,000 (2007 - $53,592,000) and the
profit attributable to ordinary shareholders was $42,001,000 (2007 - $31,000,000). No interim dividend was paid.
The directors recommend a final dividend of 5.0cts (2007 – 14.0cts) to be paid to shareholders on the register
on 26 June 2009. Shareholders may elect to receive their dividend in sterling as described on page 12.
Business Review
The review of the group’s business is set out in pages 8 to 9. In addition, the principal risks and uncertainties
of the group’s business are:
•
•
•
•
•
•
Unexpected variations in crop, principally caused by unusual weather
Variations in commodity prices
Variations in the rates of exchange of the Indonesian rupiah and the Malaysian ringgit against
the US dollar, which affect directly the local selling prices of the group’s products and the cost of
imported inputs, as well as the value of financial assets and liabilities as set out in note 25 of the
consolidated financial statements
Input cost inflation
Changes in the policy of the Indonesian or Malaysian governments towards the plantation industry
and towards foreign investment and
Protectionist tariffs or controls against CPO for either economic or environmental reasons by
importing countries.
The group’s key performance indicators, being revenue, profit after tax, profit before tax production volume,
commodity prices, extraction rates and yield are set out in “Financial record” on page 5 and in the business
review on page 8 to 9.
Environmental and corporate responsibility
The group’s management and directors take a serious view of their environmental and social responsibilities
and are fully committed to the principles developed by “Round Table for Sustainable Palm Oil” (RSPO), which
was founded by a group of growers, processors, retailers and wildlife and conservation groups to codify and
promote best practices in the industry. The key RSPO principles are set out on page 17 in “Statement on
Corporate Governance”.
Financial risk
Information on financial instruments and other risks is set out in note 25 to the consolidated financial
statements.
Biological assets, property, plant and equipment
Information relating to changes in these fixed assets is given in note 11 to the consolidated financial
statements.
Directors
A full list of directors appears on page 15. Mr. Barnes served during the year until his retirement on 30 April
2008, whilst both Mr. O’Connor and Mr. Ho served during the year until their retirement after the twenty third
annual general meeting on 31 July 2008. Datuk Chin will retire at the forthcoming annual general meeting.
Mr. Smith and Dato’ John Lim, both were appointed as directors on 26 April 2008, whilst Mr. Donald Low was
appointed as director on 26 August 2008. All other directors served throughout the year. Madam Lim will be
submitting herself for re-election while Mr. Donald Low and Mr. Nik Din, will be submitting themselves for the
first time for re-appointment by shareholders. Mr. Chan will also be submitting himself for re-appointment. Mr.
Smith resigned as director on 4 March 2009.
0
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Report
Directors’ interests
The interests of the directors together with those of their immediate families in the securities of the company were
as shown below:
Directors’ beneficial interests at 31 December
Chan Teik Huat
Donald H Low (appointed on 26 August 2008)
David W Smith (appointed on 26 April 2008 and resigned
on 4 March 2009)
Lim Siew Kim
Dato’ John Lim Ewe Chuan (appointed on 26 April 2008)
Datuk H Chin Poy-Wu (will retire at the forthcoming
annual general meeting)
Nik Din Bin Nik Sulaiman (appointed on 1April 2009)
2008
Ordinary shares
–
–
2007
Ordinary shares
–
–
–
20,521,314
–
–
–
–
20,521,314
–
–
–
The interests disclosed for Madam Lim are held by Genton International Ltd and certain other companies of which
Madam Lim is the controlling shareholder.
There have been no changes in the interests of the directors in the securities of the company between 31 December
2008 and the date of this report. Other than Madam Lim, none of the directors, had any interest in the securities of
the company between the date of their appointments and the date of this report.
Other than as set out in note 21 to the consolidated financial statements, no director had a material interest in any
contract of the company subsisting during, or at the end of, the financial year.
Substantial share interests
As at 7 April 2009, the following interests had been notified to the company, being interests in excess of 3% of the
issued ordinary share capital of the company:
Name of holder
Genton International Limited
Alcatel Bell Pension Fund
S N Roditi
Number
20,521,314
7,556,900
1,966,900
Percentage of voting
rights held
51.33%
18.90%
4.92%
Share capital, restrictions on transfer of shares, arrangements affected by change of control and other
additional information
The company has one class of share capital, ordinary shares. All the shares rank pari passu. The articles of association
of the company contain provisions governing the transfer of shares, voting rights, the appointment and replacement
of directors and amendments to the articles of association. These accord with usual English company law provisions.
There are no special control rights in relation to the company’s shares. There are no significant agreements to which
the company is a party which take effect, alter or terminate in the event of a change of control of the company. There
are no agreements providing for compensation for directors or employees on change of control.
Auditors
All of the current directors have taken all the steps that they ought to have taken to make themselves aware of any
information needed by the company’s auditors for the purposes of their audit and to establish that the auditors are
aware of the information. The directors are not aware of any relevant audit information of which the auditors are
unaware.
BDO Stoy Hayward LLP has expressed their willingness to continue in office and a resolution to re-appoint them will
be proposed as Resolution 8 at the forthcoming annual general meeting.
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Report
Authority to allot shares
At the annual general meeting held on 31 July 2008 shareholders authorised the board under the provisions
of section 80 of the Companies Act 1985 to allot relevant securities within specified limits for a period of five
years. Renewal of this authority on similar terms is being sought under Resolution 9 at the forthcoming annual
general meeting. Such authority will be limited to shares up to a maximum nominal amount of £3,331,356
which represents 33.3% of the company’s current issued share capital. The authority will last for up to five
years from the date of the resolution. The directors do not have any present intention of issuing any shares
under this authority.
A fresh authority is also being sought under the provisions of section 95 of the Companies Act 1985 to enable
the board to make an issue to existing shareholders without being obliged to comply with certain technical
requirements of the Companies Act, which create problems with regard to fractional entitlements and overseas
shareholders. In addition, the authority will give the board power to make issues of shares for cash to persons
other than existing shareholders up to a maximum aggregate nominal amount of £499,703 representing 5%
of the current issued share capital. The section 95 authority will last for up to 15 months from the date of the
annual general meeting.
Scrip dividends
Resolution 10 to be proposed at the annual general meeting seeks renewal for a further five years of the authority
under which the directors are able to offer shareholders a scrip dividend alternative. No scrip alternative is
being offered in respect of the 2008 final dividend.
Acquisition of the company’s own shares and authority to purchase own shares
At 15 April 2009, the directors had remaining authority under the shareholders’ resolution of 31 July 2008, to
make purchases of 3,997,627 of the company’s ordinary shares. This authority expires on 31 October 2009.
The board will only make purchases if they believe the earnings or net assets per share of the company would
be improved by such purchases. All such purchases will be market purchases made through the London
Stock Exchange. Companies can hold their own shares which have been purchased in this way in treasury
rather than having to cancel them. The directors would, therefore, consider holding the company’s own shares
which have been purchased by the company as treasury shares as this would give the company the flexibility
of being able to sell such shares quickly and effectively where it considers it in the interests of shareholders
to do so. Whilst any such shares are held in treasury, no dividends will be payable on them and they will not
carry any voting rights.
Resolution 11 to be proposed at the forthcoming annual general meeting seeks renewed authority to purchase
up to a maximum of 3,997,627 ordinary shares of 25p each on the London Stock Exchange, representing 10%
of the company’s issued ordinary share capital. The maximum price which may be paid for ordinary shares
on any exercise of the authority will be restricted to 5% above the average middle market quotations for such
shares as derived from the London Stock Exchange Daily Official List for the five business days before the
purchase is made.
The maximum number of shares and the price range are stated for the purpose of compliance with statutory
requirements in seeking this authority and should not be taken as an indication of the level of purchases, or
the prices thereof, that the company would intend to make.
Payment of dividends
The group reporting currency is US dollars. However, shareholders can choose to receive dividends in US
dollars or in sterling. In the absence of any specific instruction up to the date of closing the register, shareholders
with addresses in the UK are deemed to have elected to receive their dividends in sterling and those with
addresses outside the UK in US dollars.
The sterling equivalent dividend will be paid at the exchange rate ruling at the date of closure of the register.
Supplier payment policy
It is the company’s policy to pay suppliers promptly in accordance with agreed terms of payment. The company
had no trade creditors at 31 December 2008 (2007 – nil).
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Report
Liability insurance for company officers
As permitted by the Companies Act the company has maintained insurance cover for the directors against
liabilities in relation to the company.
By order of the board
Donald H Low
Director
15 April 2009
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Responsibilities
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy
at any time the financial position of the group, for safeguarding the assets of the company, for taking reasonable
steps for the prevention and detection of fraud and other irregularities and for the preparation of a directors’
report and directors’ remuneration report which comply with the requirements of the Companies Act 1985.
The directors are responsible for preparing the annual report and the financial statements in accordance with
the Companies Act 1985. The directors are also required to prepare financial statements for the group in
accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and
Article 4 of the IAS Regulation. The directors have chosen to prepare financial statements for the company in
accordance with UK Generally Accepted Accounting Practice (GAAP).
After making enquiries, the directors have a reasonable expectation that the company and the group have
adequate resources to continue operations for the foreseeable future. For this reason, they continue to adopt
the going concern basis in preparing the financial statements.
Group financial statements
International Accounting Standard 1 requires that financial statements present fairly for each financial year
the group’s financial position, financial performance and cash flows. This requires the faithful representation
of the effects of transactions, other events and conditions in accordance with the definitions and recognition
criteria for assets, liabilities, income and expenses set out in the International Accounting Standards Board’s
‘Framework for the preparation and presentation of financial statements’. In virtually all circumstances, a fair
presentation will be achieved by compliance with all applicable International Financial Reporting Standards.
A fair presentation also requires the Directors to:
•
•
•
consistently select and apply appropriate accounting policies;
present information, including accounting policies, in a manner that provides relevant, reliable, comparable
and understandable information; and
provide additional disclosures when compliance with the specific requirements of IFRS is insufficient
to enable users to understand the impact of particular transactions, other events and conditions on the
entity’s financial position and financial performance.
Parent company financial statements
Company law requires the directors to prepare financial statements for each financial year which give a true
and fair view of the state of affairs of the company and the group and of the profit or loss of the company and
the group for that period. In preparing these financial statements, the directors are required to:
•
•
•
•
select suitable accounting policies and then apply them consistently;
prepare the financial statements on the going concern basis unless it is inappropriate to presume that
the company will continue in business;
make judgements and estimates that are reasonable and prudent; and
state whether applicable accounting standards have been followed, subject to any material departures
disclosed and explained in the financial statements.
Financial statements are published on the group’s website in accordance with legislation in the United Kingdom
governing the preparation and dissemination of financial statements, which may vary from legislation in other
jurisdictions. The maintenance and integrity of the group’s website is the responsibility of the directors. The
directors’ responsibility also extends to the ongoing integrity of the financial statements contained therein.
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors
Chan Teik Huat (Executive Chairman, aged 69) – appointed 29 November 1993
Bachelor of Commerce (Melbourne); Fellow of Institute of Chartered Accountants and Certified Public
Accountants (Malaysia); former managing director of Metroplex Berhad until January 2006; founder and
managing partner of a leading accounting firm, Kassim Chan, Malaysia for some 17 years. The firm has been
renamed Deloitte Kassim Chan and, subsequently, Deloitte.
Donald Han Low (Acting Chief Executive Officer, aged 44) – appointed 26 August 2008
Chairman of Atech Holdings Limited, listed on the Australian Stock Exchange, and director of Oriented Media
Group Berhad, listed on Bursa Malaysia.
Madam Lim Siew Kim (Non-executive director, aged 60) – appointed 29 November 1993
Executive chairman of Metroplex Berhad.
Dato’ John Lim Ewe Chuan (Senior Independent non-executive director, chairman of audit committee and
nomination & corporate governance committee, and member of remuneration committee, aged 59) – appointed
26 April 2008
Chartered Certified Accountant; partner with UHY Hacker Young LLP, London, since 1998; previously he had
a professional accounting career in Singapore and the UK.
Datuk H Chin Poy-Wu (Independent non-executive director, chairman of remuneration committee, and member
of audit committee and nomination & corporate governance committee, aged 71) – appointed 1 May 1998 and
will retire at the forthcoming annual general meeting
Deputy chairman of Hap Seng Consolidated Berhad, director of Glenealy Plantations Berhad, both listed on
the Bursa Malaysia. Board member of University Malaysia, Sabah. Commissioner of Police - Kuala Lumpur,
retired 1993.
Nik Din Bin Nik Sulaiman (Independent non-executive director and member of audit committee and nomination
& corporate governance committee, aged 61) – appointed 1 April 2009
Non-executive director of MTD Capital Berhad and MTD ACPI Engineering Berhad, both listed on Bursa
Malaysia.
Anglo-Eastern Plantations Plc I Annual Report 2008
Statement on Corporate Governance
During 2008 the company has complied with the majority of the requirements of the Combined Code of Corporate
Governance. Where provisions of the Combined Code were not met during 2008, particular comment is made
in the statements below and in the Directors’ remuneration report on pages 18 to 19.
The board
The board comprises two executive and four non-executive directors, three of whom are independent. Excluding
Madam Lim, the remaining three non-executive directors are considered by the board to be independent. Datuk
Chin, one of the three independent non-executive directors has served for over nine years, the time limit set
by the Combined Code to indicate prima facie independence. Datuk Chin will retire at the forthcoming annual
general meeting. All three independent non-executive directors have a wide range of business interests beyond
their position with the company and the rest of the board agree unanimously that they have shown themselves
to be fully independent. Mr. Chan, who has been both chairman and chief executive since 1998, retired as chief
executive on 26 August 2008, and remains as executive chairman. Madam Lim, who is a non-executive director,
is the controlling shareholder of the company. The other members of the board are satisfied that through the
specific powers reserved for the board, and given the presence of the independent non-executives, there is a
reasonable balance of influence. A schedule of duties and decisions reserved for the board and management
respectively has been adopted. The audit, remuneration and nomination & corporate governance committees
have written terms of reference.
Unless warranted by unusual matters, the board normally meets three times each year. Otherwise all other
matters are dealt with by written resolution. During 2008 there were five full meetings, attended by all the
directors.
All the independent non-executive directors met on their own during 2008 and early 2009. The Chairman met
all the non-executive directors, in the absence of the other executive directors, twice in 2008.
Dato’ John Lim is the senior independent non-executive director, a position he assumed in June 2008.
Non-executives are appointed for two to three year terms. There have been changes in non-executive directors
at intervals in 2008 for a variety of reasons. To maintain the vitality of the board, the directors specify fixed
terms of office for non-executives. However, the board will review the position of each director for the normal
three yearly re-election under the Articles.
New directors do not receive formal training on the occasion of their appointment to the board as all have
previous experience of public listed company directorship and/or some of them have worked in financial or
accounting service industries.
In April 2009 the board conducted a review of its performance by discussion. No major issues arose from this
review.
The nomination and corporate governance committee currently comprises Dato’ John Lim (Chairman), Mr. Nik
Din Nik Sulaiman and Datuk Chin. During 2008, Mr. O’Connor (chairman until retirement on 31 July 2008),
Mr. Ho (until retirement on 31 July 2008) and Mr. Smith (from 26 August 2008 until 3 March 2009) were also
members of the nomination and corporate governance committee. The committee had three meeting during
2008, attended by all members, and has met once in 2009 to discuss succession and the appointment of non-
executive director. The acting Chief Executive Officer has, in the interim, assumed the role and responsibility
of the Finance Director since the re-designation of Mr. Smith to non-executive director on 26 August 2008.
Relations with shareholders
Company executives and the senior independent non-executive director attempt to contact principal shareholders
twice a year and at all times are pleased to speak to and meet any shareholder. Given the dispersion of directors
and shareholders it is not possible for every non-executive director to meet shareholders in the presence of
management.
A member of the audit and remuneration committees will be available at the 2009 annual general meeting.
Anglo-Eastern Plantations Plc I Annual Report 2008
Statement on Corporate Governance
Accountability and audit
The responsibilities of the directors as regards the financial statements are set out on page 14. A statement
of going concern is also on page 14.
The audit committee comprises Dato’ John Lim (chairman), Mr. Nik Din Nik Sulaiman and Datuk Chin. Dato’
John Lim has current financial experience from his present principal occupations in the accounting services
profession. During 2008, Mr. Ho (chairman until retirement on 31 July 2008), Mr. O’Connor (until retirement on
31 July 2008) and Mr. Smith (from 26 August 2008 until resignation on 3 March 2009) were also members of
the audit committee. The committee met prior to the completion of the 2008 accounts and three times during
2008. These meetings were attended by all members.
Internal control
The company has followed the Combined Code provisions and Turnbull Committee guidance on internal
control since 1999. The board has overall responsibility for the group’s internal control and risk management
and for reviewing its effectiveness; the audit committee reviews and monitors specific risks and internal control
procedures and reports to the board where appropriate. Executive staff and directors are responsible for
implementation of control procedures and for identifying and managing business risks. The audit committee
review is a continuous but sequential process and in any one year does not necessarily cover all risks which
are significant to the group. The process aims to provide reasonable assurance against material misstatement
or loss but cannot eliminate the risk of loss. In 2008 and early 2009, for example, the audit committee reviewed,
among other things, in relation to risk – insurance arrangements, labour law provisions, exchange exposure;
and, in relation to financial control – bought-in crop pricing, squatter land compensation and capital expenditure
approval.
The board receives monthly reports from executive management in Indonesia and Malaysia and focuses at each
meeting on the principal continuing risks to which the group is exposed including, but not limited to, commodity
price movements, exchange rate movements, political and social change and government legislation.
The group has an internal audit department which visits each operating site in Indonesia and Malaysia twice
a year and provides a wide ranging report and the work and conclusions of the internal audit department are
reviewed independently by the audit committee.
Environmental and corporate responsibility
In 2004 a group of growers, processors, retailers and wildlife and conservation groups founded the “Round Table
for Sustainable Palm Oil”, known as RSPO, to codify and promote best practices in the industry. The group’s
management and directors take a serious view of their environmental and social responsibilities and are fully
committed to the principles being developed by RSPO. These principles cover eight headings as follows:
•
•
•
•
•
•
•
•
Transparency
Compliance with local laws and regulations
Commitment to long term economic and financial viability
Use of appropriate best practices by growers and millers
Environmental responsibility and conservation of natural resources and biodiversity
Responsible consideration of individuals and communities affected by growers and mills
Responsible development of new plantings
Commitment to continuous improvement in key areas of activity.
Within these headings are 40 detailed principles. Among the most important are:
•
•
•
•
•
•
•
•
Not to remove primary forest
Not to use fire for clearing areas designated for new or replantings
To follow accepted soil and water conservation practices
To use agrochemicals in ways that do not endanger health or the environment and to promote
non-chemical methods of pest management
To leave wild areas for wildlife corridors, water catchment and riparian protection
Provide full treatment of mill effluent water
Ensure the wishes of local communities and individuals are taken account of, and
To pay to individuals with residual rights over land only freely agreed compensation, in addition to
following government land regulations.
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Remuneration Report
This report by the remuneration committee has been approved by the board of directors for submission to
shareholders for their approval at the forthcoming annual general meeting.
Membership
The remuneration committee comprised throughout the year Datuk Chin (chairman) and Dato’ John Lim. Mr.
Ho (until retirement on 31 July 2008) and Mr. O’Connor (until retirement on 31 July 2008) were also members
of the remuneration committee. The committee met twice in 2008, attended by all members.
Policy
The remuneration committee makes recommendations on senior management pay and conditions, after
consultation with the executive chairman, and recommends to the board the terms of executive directors.
Non-executive directors’ remuneration is considered by the board as a whole.
The committee recommends remuneration terms by reference to individual performance, market conditions,
the company’s performance and the need to maintain an economic operation.
Components
Base salary
Base salaries are reviewed on an annual basis by the remuneration committee or when an individual changes
responsibilities. Non-executive directors receive no benefits other than a fee.
Bonus
The group operates a bonus scheme for senior executives and managers of operating units, which is generally
determined by operating performance criteria. Annual bonuses for executive chairman and/or executive directors
ranging from 0% to 66% of base salary, are determined at the discretion of the board.
Share options
The UK and overseas executive share option schemes of the company are administered and supervised by
a committee consisting, in the majority, of non-executive directors. These schemes are limited over their 10
year life to issuing no more than 10% of the issued ordinary share capital of the company from time to time.
They provide for options to be granted over treasury shares as well as over new shares. To avoid dilution, the
board intends generally to follow the treasury share route.
Individual grants are phased over three years. The total grant to each holder is determined by seniority and
total market value at date of grant is normally limited to two times base salary. Exercise of options is only
permitted three years after grant, provided that they remain employees of the group throughout the period.
There are no other performance criteria for exercise of options granted so far.
Pensions
There is no company-sponsored pension scheme for executive directors or senior executives and management.
However, contributions are made to employees personal pension schemes. Senior executives in Indonesia
who leave after more than five years’ service are entitled to a gratuity of one month’s base salary for each
year of service.
Service contracts
All directors, executive and non-executive, have formal appointment letters. Those of the non-executives are
all for two to three year terms with notice periods of one month. Mr. Chan has a contract dated 26 August
2008 with a notice period of six months. Mr. Donald Low’s contract is for one year from 26 August 2008. Notice
periods for all other senior management are generally between three and six months.
Performance graph
The following graph shows the company’s performance, measured by capital return, compared to the Bursa
Malaysia (KLSE) Plantation Index for the period 2 January 2004 to 1 April 2009. This is the only relevant index
available in terms of sector but, any comparison should be qualified; many Malaysian plantation companies
are diversified, as well as not holding as great a proportion of their assets in Indonesia as Anglo-Eastern.
In determining senior management compensation, the remuneration committee is influenced by the operating
performance of the company and not directly by the share price.
Anglo-Eastern Plantations Plc I Annual Report 2008
Directors’ Remuneration Report
A n g l o - E a s t e r n P l a n t ( E Q )
K u a l a L u m p u r S E / P l a n t a t i o n I n d e x
h
t
w
o
r
g
e
g
a
t
n
e
c
r
e
P
350.0
300.0
250.0
200.0
150.0
100.0
50.0
0.0
-50.0
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7
2 0 0 8
2 0 0 9
P e r i o d f r o m 1 / 0 1 / 0 4 t o 1 / 0 4 / 0 9
Audited information
Directors’ share options
Share options granted to the directors of the company under the company’s 1994 Executive Share Option
Scheme and Overseas Share Option Scheme and outstanding at 31 December 2008 were:
Name of Director
Date of Grant
Exercise price
Period of option
T H Chan
David W Smith
30.04.02
03.06.08
44.7p
608p
30.04.05-29.04.12
03.06.11-02.06.18
Note: * Share option will lapse 6 months after resignation, i.e. on 4 September 2009
No of ordinary shares under option
(Exercised)
–
–
31 Dec 08
30,600
*20,000
1 Jan 08
30,600
20,000
The market price of the shares at 31 December 2008 was 272.50p and the range during 2008 was 237.00p
to 715.00p.
Directors’ remuneration
The remuneration of all directors who served during the year was:
Name of director
Executive:
Chan Teik Huat (1)
Donald H Low (2)
David W Smith (3)
R O B Barnes (4)
Kee Lian Yong (5)
Non-executive:
Lim Siew Kim
Dato’ John Lim Ewe Chuan (6)
Datuk H Chin Poy-Wu (7)
Ho Soo Ching (8)
Peter E O’Connor (8)
2008
2007
Executive
salary
$000
Fees
$000
Bonus Benefits
in kind
$000
(re 2007)
$000
Total
2008
$000
–
–
1
–
–
24
31
32
23
20
131
136
102
45
127
89
–
–
–
–
–
–
363
390
63
–
–
–
–
–
–
–
–
–
63
157
221
45
128
117
–
24
31
32
23
20
641
56
–
–
28
–
–
–
–
–
–
84
89
Total
2007
$000
198
–
–
352
86
26
–
35
40
35
772
Pension
contribution
2008
$000
2007
$000
–
–
15
7
–
–
–
–
–
–
–
22
–
–
–
39
–
–
–
–
–
–
–
39
Notes:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
redesignated from executive chairman/chief executive officer to executive chairman on 26 August 2008
appointed on 26 August 2008
appointed on 26 April 2008/ redesignated as non-executive director on 26 August 2008/ resigned on 4 March 2009
retired on 30 April 2008
resigned on 30 September 2007
appointed on 26 April 2008
will retire at forthcoming annual general meeting
retired on 31 July 2008
On behalf of the board
Datuk H Chin Poy-Wu
Chairman, remuneration committee
15 April 2009
19
Anglo-Eastern Plantations Plc I Annual Report 2008
Auditors’ Report
Independent auditors’ report to the shareholders of Anglo-Eastern Plantations Plc
We have audited the group and parent company financial statements (the ‘’financial statements’’) of Anglo Eastern Plantations Plc
for the year ended 31 December 2008 which comprise the consolidated income statement, the consolidated and parent company
balance sheets, the consolidated cash flow statement, the consolidated statement of total recognised income and expense and
the related notes. These financial statements have been prepared under the accounting policies set out therein.
We have also audited the information in the directors’ remuneration report that is described as having been audited.
Respective responsibilities of directors and auditors
The directors’ responsibilities for preparing the Annual Report and the group financial statements in accordance with applicable law
and International Financial Reporting Standards (IFRS) as adopted by the European Union, and for preparing the parent company
financial statements and the directors’ remuneration report in accordance with applicable law and United Kingdom Accounting
Standards (United Kingdom Generally Accepted Accounting Practice) are set out in the statement of directors’ responsibilities.
Our responsibility is to audit the financial statements and the part of the directors’ remuneration report to be audited in accordance
with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements give a true and fair view and whether the financial statements
and the part of the directors’ remuneration report to be audited have been properly prepared in accordance with the Companies Act
1985 and whether in addition, the group financial statements have been properly prepared in accordance with Article 4 of the IAS
Regulation. We also report to you if, in our opinion, the information in the directors’ report is consistent with the financial statements.
In addition, we report to you if, in our opinion, the company has not kept proper accounting records, we have not received all the
information and explanations we require for our audit, or if information specified by law regarding directors’ remuneration and other
transactions is not disclosed.
We review whether the corporate governance statement reflects the company’s compliance with the nine provisions of the 2006
FRC Combined Code specified for our review by the Listing Rules of the Financial Services Authority, and we report if it does not.
We are not required to consider whether the board’s statements on internal control cover all risks and controls, or form an opinion
on the effectiveness of the group’s corporate governance procedures or its risk and control procedures.
We read other information contained in the annual report and consider whether it is consistent with the audited financial statements.
The other information comprises only the financial summary, the chairman’s statement, financial record, the estate areas and
location of estates, the business review, the directors’ report, statement on corporate governance and the unaudited parts of the
directors’ remuneration report. We consider the implications for our report if we become aware of any apparent misstatements or
material inconsistencies with the financial statements. Our responsibilities do not extend to any other information.
Our report has been prepared pursuant to the requirements of the Companies Act 1985 and for no other purpose. No person is
entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose
of the Companies Act 1985 or has been expressly authorised to do so by our prior written consent. Save as above, we do not
accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all
such liability.
Basis of audit opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices
Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements
and the part of the directors’ remuneration report to be audited. It also includes an assessment of the significant estimates and
judgments made by the directors in the preparation of the financial statements, and of whether the accounting policies are appropriate
to the group’s and company’s circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order
to provide us with sufficient evidence to give reasonable assurance that the financial statements and the part of the directors’
remuneration report to be audited are free from material misstatement, whether caused by fraud or other irregularity or error. In
forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements and the
part of the directors’ remuneration report to be audited.
Opinion
In our opinion:
•
the group financial statements give a true and fair view, in accordance with IFRS as adopted by the European Union, of the
state of the group’s affairs as at 31 December 2008 and of its profit for the year then ended;
the group financial statements have been properly prepared in accordance with the Companies Act 1985 and Article 4 of
the IAS Regulation
the parent company financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted
Accounting Practice, of the state of the parent company’s affairs as at 31 December 2008; and
the parent company financial statements and the part of the directors’ remuneration report to be audited have been properly
prepared in accordance with the Companies Act 1985.
the information given in the directors’ report is consistent with the financial statements.
•
•
•
•
BDO STOY HAYWARD LLP
Chartered Accountants and Registered Auditors
55 Baker Street
London W1U 7EU
0
Anglo-Eastern Plantations Plc I Annual Report 2008
15 April 2009
Consolidated Income Statement
for the year ended 31 December 2008
2008
Result
before
BA
BA
Notes adjustment adjustment
$000
$000
Result
before
BA
adjustment
$000
2007
BA
adjustment
$000
Total
$000
174,684
(96,812)
77,872
–
–
(3,808)
74,064
1,503
3,645
(2,686)
–
–
–
1,347
–
–
1,347
–
–
–
174,684
(96,812)
127,898
(72,297)
77,872
55,601
1,347
–
(3,808)
75,411
1,503
3,645
(2,686)
–
566
(3,646)
52,521
215
1,800
(1,945)
–
–
–
1,001
–
–
1,001
–
–
–
Total
$000
127,898
(72,297)
55,601
1,001
566
(3,646)
53,522
215
1,800
(1,945)
76,526
(25,487)
1,347
(404)
77,873
(25,891)
52,591
(15,328)
1,001
(300)
53,592
(15,628)
51,039
943
51,982
37,263
701
37,964
41,182
9,857
819
124
42,001
9,981
30,485
6,778
515
186
31,000
6,964
51,039
943
51,982
37,263
701
37,964
105.1 cts
104.8 cts
78.5 cts
78.4 cts
Continuing operations
Revenue
Cost of sales
Gross profit
Biological asset revaluation
movement (BA adjustment)
Other income
Administration expenses
Operating profit
Exchange profits
Finance income
Finance costs
Profit before tax
Tax
Profit for the year
Attributable to:
- Equity holders of the parent
- Minority interests
Earnings per share
- basic
- diluted
2
3
4
4
5
8
9
9
Earnings before BA adjustment are shown in note 9.
The accompanying notes are an integral part of this consolidated income statement.
Anglo-Eastern Plantations Plc I Annual Report 2008
Consolidated Statement of Recognised
Income and Expense
for the year ended 31 December 2008
Unrealised surplus on revaluation of the estates
Loss on exchange translation
Deferred tax on revaluation
Total recognised income and expense for the year
Profit for the year
Notes
22
22
22
22
2008
$000
5,302
(29,944)
(1,128)
(25,770)
51,982
2007
$000
4,823
(5,932)
(1,186)
(2,295)
37,964
Total recognised income and expense for the year
26,212
35,669
Attributable to:
- Equity holders of the parent
- Minority interest
22
22
19,872
6,340
28,639
7,030
26,212
35,669
The accompanying notes are an integral part of this consolidated statement of recognised income and expenses.
Anglo-Eastern Plantations Plc I Annual Report 2008
Consolidated Balance Sheet
as at 31 December 2008
Non-current assets
Biological assets
Property, plant and equipment
Receivables
Current assets
Inventories
Tax receivables
Trade and other receivables
Cash and cash equivalents
Current liabilities
Bank loans and other financial liabilities
Trade and other payables
Tax liabilities
Net current assets
Non- current liabilities
Bank loans and other financial liabilities
Deferred tax liabilities
Retirement benefits - net liabilities
Net assets
Equity
Share capital
Treasury shares
Share premium reserve
Share capital redemption reserve
Revaluation and exchange reserves
Retained earnings
Equity attributable to equity holders of the parent
Minority interests
Total equity
Notes
2008
$000
2007
$000
11
11
12
13
14
15
16
15
17
18
19
19
22
22
22
22
22
38,843
160,012
1,677
38,580
148,443
1,677
200,532
188,700
4,196
761
4,143
69,442
4,910
1,875
1,462
66,358
78,542
74,605
(8,639)
(10,749)
(10,428)
(7,293)
(9,311)
(8,085)
(29,816)
(24,689)
48,726
49,916
(27,025)
(28,450)
(1,494)
(35,719)
(23,025)
(1,534)
192,289
178,338
15,504
(1,785)
23,935
1,087
(22,083)
144,073
15,504
(1,785)
23,935
1,087
46
107,184
160,731
31,558
145,971
32,367
192,289
178,338
The financial statements were approved by the board of directors and authorised for issue on 15 April 2009 and
were signed on its behalf by
Donald Han Low
The accompanying notes are an integral part of this consolidated balance sheet.
Anglo-Eastern Plantations Plc I Annual Report 2008
Consolidated Cash Flow Statement
for the year ended 31 December 2008
Cash flows from operating activities
Profit before tax
Adjustments for:
BA adjustment
Net profit on disposal of current and fixed asset investments
Profit on disposal of tangible fixed assets
Depreciation
Share based remuneration expense
Retirement benefit provisions
Net finance (income)/expense
Operating cash flow before changes in working capital
Decrease/(increase) in inventories
(Increase)/decrease in trade and other receivables
(Decrease)/increase in trade and other payables
Cash inflow from operations
Interest paid
Overseas tax paid
Net cash flow from operations
Investing activities
Acquisition of subsidiaries
Property, plant and equipment
- purchase
- sale
Interest received
Net cash used in investing activities
2008
$000
2007
$000
77,873
53,592
(1,347)
–
(53)
4,902
–
40
(959)
80,456
712
(2,730)
(3,935)
74,503
(2,728)
(17,898)
(1,001)
(518)
–
4,264
87
700
145
57,269
(3,125)
142
3,600
57,886
(2,051)
(9,196)
53,877
46,639
(11,363)
(14,480)
(19,738)
489
3,645
(12,244)
94
1,800
(26,967)
(24,830)
Anglo-Eastern Plantations Plc I Annual Report 2008
Consolidated Cash Flow Statement
for the year ended 31 December 2008
Financing activities
Dividends paid by parent company
Share options exercised
Purchase of own shares for treasury
Repayment of existing long term loans
Drawdown of new long term loan
Finance lease (repayment)/drawdown
Dividends paid to minority shareholders
Loan to minority shareholder
Repayment of loan by minority shareholder
Purchase of portfolio investment
Receipt from sale of portfolio investment
Net cash (used in)/from financing activities
Increase in cash and cash equivalents
Cash and cash equivalents less overdrafts
At beginning of period
Foreign exchange
At end of period
Comprising,
Cash at end of year
Overdraft at end of year
Net cash at end of year
2008
$000
2007
$000
(5,112)
–
–
(4,237)
–
(110)
(2,378)
–
48
–
–
(4,266)
40
(398)
(1,694)
34,500
7
(735)
(578)
286
(1,668)
2,234
(11,789)
27,728
15,121
49,537
63,357
(9,036)
16,823
(3,003)
69,442
63,357
69,443
(1)
66,358
(3,001)
69,442
63,357
The accompanying notes are an integral part of this consolidated cash flow statement.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
1
Accounting policies
Basis of preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS and
IRFIC interpretations) issued by the International Accounting Standards Board (IASB) as adopted by the EU and with those
parts of the Companies Act 1985 applicable to companies preparing their accounts under IFRS. The principal accounting
policies adopted in the preparation of these financial statements are set out below. These policies have been consistently
applied to all the years presented, unless otherwise stated.
Changes in accounting policies
(a)
New standards effective in 2008 and adopted by the group
No new standards were adopted during the year.
(b)
Standards effective in 2008 but not relevant to the group
IFRIC 7, Applying the restatement approach under IAS 29, Financial Reporting in Hyperinflationary Economies
(effective for accounting periods beginning on or after 1 March 2006).
IFRIC 11, IFRS 1 – Group and Treasury Share Transactions (effective for accounting periods beginning on or after 1
March 2007), which requires share-based payment transactions in which an entity receives services as consideration
for its own equity instruments to be accounted for as equity settled. In terms of transactions to date there would be
no impact on the accounts.
IFRIC 12, Service Concession Arrangements (effective for accounting periods after 1 January 2009).
IFRIC 14, IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
(effective for accounting periods beginning on or after 1 January 2008).
(c)
Standards, not yet effective
Certain new standards, amendments and interpretations to existing standards have been published that are mandatory
for the group’s accounting periods beginning on or after 1 January 2009 or later periods and which the group has
decided not to adopt early. These are:
IFRS 8, Operating Segments (effective for accounting periods beginning on or after 1 January 2009). As this is a
disclosure standard it will not have any impact on the results or net assets of the group.
IAS 23, Borrowing Costs (revised) (effective for accounting periods beginning on or after 1 January 2009). This is
relevant to the group but it is expected there will be no impact on the financial statements.
* IFRIC 13, Customer Loyalty Programmes (effective for accounting periods after 1 July 2008), which is not relevant
to the group.
Revised IFRS 3, Business Combinations and complementary Amendments to IAS 27, ‘Consolidated and Separate
Financial Statements’ (both effective for accounting periods beginning on or after 1 July 2009). This revised standard
and amendments to it is still to be endorsed by the EU. Management is currently assessing the impact of revised
IFRS 3 and amendments to IAS 27 on the accounts.
Amendment to IFRS 2, Share-based payments; vesting conditions and cancellations (effective for accounting periods
beginning on or after 1 January 2009). Management is currently assessing the impact of the amendment on the
accounts.
* Amendment to IAS 32, Financial Instruments; Presentation and IAS 1, Presentation of Financial Statements (effective
for accounting periods beginning on or after 1 January 2009). This amendment is still to be endorsed by the EU but
is not relevant to the group.
* Amendments to IAS 1, Presentation of Financial Statements: A Revised Presentation (effective for accounting
periods beginning on or after 1 January 2009).
* Amendments to IAS 39 and IFRS 7: Reclassification of Financial Instruments (effective for accounting periods after
1 July 2008).
* Amendments to IFRS 1 and IAS 27 Cost of an Investment in a subsidiary, jointly-controlled entity or associate1
(effective for accounting periods beginning on or after 1 January 2009). This amendment is still to be endorsed by
the EU but is not relevant to the group.
* Amendment to IAS 39 Financial Instruments: Recognition and Measurement: Eligible Hedged Items (effective for
accounting periods after 1 July 2009). This amendment is still to be endorsed by the EU but is not relevant to the
group.
* IFRIC 15 Agreements for the Construction of Real Estate (effective for accounting periods beginning on or after 1
January 2009). This amendment is still to be endorsed by the EU but is not relevant to the group.
* IFRIC 16 Hedges of a Net Investment in a Foreign Operation (effective for accounting periods after 1 October 2008).
This amendment is still to be endorsed by the EU but is not relevant to the group.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
1
Accounting policies - continued
* IFRIC 17 Distributions of Non-cash Assets to Owners (effective for accounting periods after 1 July 2009). This
amendment is still to be endorsed by the EU but is not relevant to the group.
Improvements to IFRSs (effective for accounting periods beginning on or after 1 January 2009). This amendment is
still to be endorsed by the EU.
* Revised IFRS 1 First-time Adoption of international Financial Reporting Standards (effective for accounting periods
beginning on or after 1 January 2009). This amendment is still to be endorsed by the EU but is not relevant to the
group.
(*) Not yet EU endorsed.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the company and entities controlled by the
company (its subsidiaries) made up to 31 December each year. Control is achieved where the Company has the power to
govern the financial and operating policies of an investee entity so as to obtain benefits from its activities.
Business combinations
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the
consolidated balance sheet, the acquiree’s identifiable assets, liabilities and contingent liabilities are initially recognised
at their fair values at the acquisition date. Acquisitions of entities that comprise principally land with no active plantation
business does not represent business combination, in such case, the amount paid for each acquisition is allocated between
the identifiable assets/liabilities at the acquisition date.
The results of acquired operations are included in the consolidated income statement from the date on which control is
obtained.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used
into line with those used by the group.
All intergroup transactions, balances, income and expenses are eliminated on consolidation.
Foreign currency
The individual financial statements of each subsidiary are presented in the currency of the country in which it operates
(its functional currency) with the exception of the company and its UK subsidiaries which are presented in US dollars. The
presentation currency for the consolidated financial statements is also US dollars, chosen because the price of the bulk of
the group’s products are ultimately denominated in dollars.
On consolidation, the results of overseas operations are translated into US dollars at average exchange rates for the year
unless exchange rates fluctuate significantly in which case the actual rate is used. All assets and liabilities of overseas
operations are translated at the rate ruling at the balance sheet date. Exchange differences arising on re-translating the
opening net assets at opening rate and the results of overseas operations at actual rate are recognised directly in equity (the
“foreign exchange reserve”). Exchange differences recognised in the income statement of group entities’ separate financial
statements on the translation of long-term monetary items forming part of the group’s net investment in the overseas operation
concerned are reclassified to the foreign exchange reserve if the item is denominated in the presentational currency of the
group or of the overseas operation concerned.
On disposal of a foreign operation, the cumulative exchange differences recognised in the foreign exchange reserve relating
to that operation up to date of disposal are transferred to the income statement as part of the profit or loss on disposal.
All other exchange profits or losses are credited or charged to the income statement.
Revenue recognition
Revenue includes
-
amounts receivable for produce provided in the normal course of business, net of sales related taxes and levies,
including export taxes;
amounts received for sales of palm kernel shell, rubber wood and other income of an operating nature.
-
Sales of CPO and palm kernel are recognised when goods are delivered or allocated to a purchaser. Delivery or allocation
does not take place until contracts are paid for. Sales of rubber are recognised on signing of sales contract.
Share based payments
Outstanding share options are measured at fair value (excluding the effect of non market-based vesting conditions) at the
date of grant. This fair value is expensed on a straight-line basis over the vesting period, based on the group’s estimate of
shares that will eventually vest and adjusted for the effect of non market-based vesting conditions.
Fair value is measured by use of a binominal model. The expected life used in the model has been adjusted, based on
management’s best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations.
Provided that all other vesting conditions are satisfied, a charge is made irrespective of whether the market vesting conditions
are satisfied.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
1
Accounting policies -continued
Interest capitalisation
Interest on third party loans directly related to field development is capitalised in the proportion that the opening immature
area bears to the total planted area of the relevant estate. Interest on loans related to construction in progress (such as an
oil mill) is capitalised up to the commissioning of that asset. These interest rates are booked at the rate prevailing at the
time.
Tax
UK and foreign corporation tax is provided at amounts expected to be paid or recovered using the tax rates and laws that
have been enacted or substantively enacted by the balance sheet date.
Dividends
Equity dividends are recognised when they become legally payable. The company pays only one dividend each year as
a final dividend which becomes legally payable when approved by the shareholders at the next following annual general
meeting.
Segment reporting
Save for a small amount of rubber, all the group’s operations are devoted to oil palm. Therefore the group’s principal segment
report is by geographical area, as the estates in each specific area tend to be at the same stage of development and each
area tends to have different agricultural conditions.
Biological assets, property, plant and equipment
Estates, which comprise biological assets, and property plant and equipment, are shown at fair values in use, which are
calculated internally every year and reviewed by an external valuer every five years. Value in use is calculated as the present
value of the local currency cash flows of each estate over the next twenty years, including replanting where required.
Any surplus or deficit on revaluation of property, plant and equipment is transferred to the revaluation and exchange reserve,
except that a deficit which is in excess of any previously recognised surplus relating to the same property is charged to the
income statement. On the disposal or recognition of a provision for impairment of a revalued estate, any related balance
remaining in the revaluation and exchange reserve is transferred to retained earnings as a movement on reserves.
Oil mills, which are part of property, plant and equipment, are shown at cost less depreciation.
The depreciation charge on Indonesian estates is based on mature values at the beginning of the year and is provided at
a rate of 2% per annum. Oil mills are depreciated at 5% per annum. The Malaysian leasehold land is depreciated over the
remaining term of the lease. Mature plantations in Malaysia are depreciated at 5% per annum.
Within the estate valuations described above the value of biological assets is estimated separately as a proportion of total
estate value and, as required by IAS41, the movement in valuation surplus of biological assets is charged or credited to the
income statement for the relevant period (BA adjustment).
Leased assets
Assets financed by leasing agreements which give rights approximating to ownership (finance leases) are capitalised at
amounts equal to the original cost of the asset to the lessors and depreciation is provided on the asset over the shorter of
the lease term or its useful economic life on the basis of group depreciation policy. The capital elements of future obligations
under finance leases are included as liabilities in the balance sheet and the current year’s interest element is charged to
the income statement to produce a constant rate of charge on the balance of capital repayments outstanding. There are no
operating leases.
Impairment
Impairment tests on tangible assets are undertaken annually on 31 December. Where the carrying value of an asset exceeds
its recoverable amount (i.e. the higher of value in use or fair value, less costs to sell), the asset is written down accordingly.
Impairment charges are included in the administrative expenses line item in the income statement, except to the extent they
reverse gains previously recognised in the statement of recognised income and expense.
Inventories
Inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value. Cost comprises
all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and
condition.
Weighted average cost is used to determine the cost of ordinarily interchangeable items.
All produce inventories are already in processed form as oil or kernel and therefore the requirement under IAS41 to value
agricultural produce at market value, does not apply.
Financial assets
All the group’s receivables and loans are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market. They are recognised at fair value at inception and subsequently at amortised cost. No impairment
provisions have been considered necessary.
Cash and cash equivalents consist of cash in hand and short term deposits at banks. Bank overdrafts are shown within
loans and borrowings under current liabilities on the balance sheet.
There are no assets in hedging relationships and no financial assets or liabilities available for sale.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
1
Accounting policies -continued
Financial liabilities
All the group’s financial liabilities are non-derivative financial liabilities.
Bank borrowings and long term development loans are initially recognised at fair value and subsequently at amortised cost,
which is the total of proceeds received net of issue costs. Finance charges are accounted for on an accruals basis and
charged in the income statement, unless capitalised according to the policy as set out under Interest capitalisation above.
Trade and other payables are shown at fair value at recognition.
Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the balance sheet
differs from its tax base except for differences in the initial recognition of an asset or liability in a transaction which is not a
business combination and at the time of the transaction affects neither accounting nor taxable profit.
Recognition of deferred tax assets is restricted to those instances where it is possible that taxable profit will be available
against which the difference can be utilised. Deferred tax is recognised on temporary differences arising on property
revaluation surpluses.
Deferred tax is determined using the tax rates that are in force at the balance sheet date and are expected to apply in the
period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement,
except when it relates to items charged or credited directly to equity, such as revaluations, in which case the deferred tax
is also dealt with in equity; in this case assets and liabilities are offset.
Retirement benefits
Contributions to defined contribution pension schemes are charged to the income statement in the year to which they
relate.
The group operates a number of defined benefit pension schemes in respect of its Indonesian operations. The pension
costs of these schemes charged to the income statement comprise the annual payments to the schemes together with any
provision required for any shortfall in funding as disclosed by annual valuations of the schemes as advised by the schemes’
actuaries.
Treasury shares
Consideration paid or received for the purchase or sale of the company’s own shares for holding in treasury is recognised
directly in equity, where the cost is presented as the treasury share reserve. Any excess of the consideration received on
the sale of treasury shares over the weighted average cost of shares sold, is taken to the share premium account.
Any shares held in treasury are treated as cancelled for the purpose of calculating earnings per share.
Critical accounting estimates and judgements
The preparation of the group financial statements in conformity with IFRS requires the use of estimates and assumptions
that affect the reported assets and liabilities and reported revenue and expenses. Actual results could differ from those
estimates and accordingly they are reviewed on an on-going basis. The main areas in which estimates are used are: fair
value of biological assets, property, plant and equipment, deferred tax and retirement benefits.
Revisions to accounting estimates are recognised in the period in which the estimate is revised or the revision affects only
that period, or in the period of revision and future periods if the revision affects both and current and future periods.
Assumptions regarding the valuation of biological assets, property, plant and equipment are set out in note 11. The group’s
policy with regard to impairment of such assets is set out above.
Details on deferred tax are given in note 17 and retirement benefits in note 18.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
2
Revenue
Sales of produce
Other income
3
Other income
Gains from current asset investments
4
Finance income and expense
Finance income
Finance expense
Interest payable on:
Development loans
Overdraft
Finance leases
Other
Interest capitalised on loans related to field development and construction in progress
- (note 15)
- (note 15)
Net finance income/(expense) recognised in income statement
5
Profit before tax
Profit before tax is stated after charging
Depreciation (including $61,400 (2007 – $56,000) in respect of leased assets)
Staff costs (note 7)
Auditors’ remuneration
- group audit (company $25,000 (2007 $25,000)
- audit of subsidiaries
- other services
- Total
2008
$000
174,175
509
2007
$000
127,619
279
174,684
127,898
2008
$000
–
2007
$000
566
2008
$000
3,645
2,717
8
3
–
(42)
2007
$000
1,800
1,873
72
9
97
(106)
2,686
1,945
959
(145)
2008
$000
2007
$000
4,902
4,264
14,601
11,726
77
62
–
139
96
62
–
158
0
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
9
0
5
5
7
1
,
4
7
1
4
8
6
,
4
7
1
7
4
3
,
1
6
2
5
,
6
7
3
7
8
,
7
7
)
1
9
8
,
5
2
(
2
8
9
,
1
5
)
6
0
7
,
8
4
(
3
7
8
,
9
7
2
)
8
7
8
,
8
3
(
7
6
1
,
1
3
2
9
8
2
,
2
9
1
)
2
0
9
,
4
(
1
0
1
,
1
3
0
0
0
$
9
7
2
9
1
6
,
7
2
1
8
9
8
,
7
2
1
1
0
0
,
1
1
9
5
,
2
5
2
9
5
,
3
5
)
8
2
6
,
5
1
(
4
6
9
,
7
3
)
2
4
0
,
5
5
(
0
9
4
,
4
6
2
)
0
1
1
,
1
3
(
8
4
4
,
9
0
2
8
3
3
,
8
7
1
)
4
6
2
,
4
(
1
4
8
,
7
2
–
–
–
–
)
9
8
0
,
1
(
)
9
8
0
,
1
(
)
0
5
5
,
4
(
)
9
3
6
,
5
(
)
3
2
8
(
4
6
3
,
2
–
1
4
5
,
1
1
4
5
,
1
–
–
0
0
0
$
–
–
–
–
)
5
4
9
(
)
5
4
9
(
–
)
5
4
9
(
0
7
4
,
3
)
4
8
0
,
1
(
)
4
1
(
6
8
3
,
2
2
7
3
,
2
–
–
l
a
t
o
T
0
0
0
$
K
U
0
0
0
$
0
0
0
$
0
0
0
$
0
0
0
$
1
3
1
3
7
8
,
6
4
0
0
,
7
5
4
8
0
5
,
2
)
1
6
(
3
5
5
,
2
2
9
4
,
2
)
2
5
4
(
6
8
8
,
6
2
)
1
5
5
(
4
3
4
,
6
2
3
8
8
,
5
2
9
6
2
)
4
9
8
(
0
0
0
$
4
2
2
7
8
,
5
6
9
8
,
5
)
4
(
1
1
0
9
7
,
2
1
0
8
,
2
7
9
7
,
2
)
5
4
6
,
1
(
0
3
8
,
4
2
–
5
8
1
,
3
2
5
8
1
,
3
2
2
7
7
)
6
8
8
(
8
7
3
2
0
3
,
7
6
1
0
8
6
,
7
6
1
2
0
3
,
1
7
0
1
,
5
7
9
0
4
,
6
7
)
0
8
2
,
1
2
(
9
2
1
,
5
5
)
1
3
4
,
7
4
(
3
2
6
,
0
5
2
)
7
2
3
,
8
3
(
2
9
1
,
3
0
2
5
6
8
,
4
6
1
)
8
0
0
,
4
(
2
3
8
,
0
3
0
0
0
$
5
5
2
7
4
7
,
1
2
1
2
0
0
,
2
2
1
0
9
9
6
4
7
,
0
5
6
3
7
,
1
5
)
4
2
6
,
5
1
(
2
1
1
,
6
3
)
3
1
3
,
2
5
(
0
9
1
,
6
3
2
)
6
9
0
,
1
3
(
7
7
8
,
3
8
1
1
8
7
,
2
5
1
)
8
7
3
,
3
(
9
6
0
,
7
2
–
–
–
–
–
–
–
–
)
6
7
(
8
7
2
,
7
)
7
(
2
0
2
,
7
–
5
9
1
,
7
9
9
5
,
3
0
0
0
$
–
–
–
–
–
–
–
–
–
–
9
4
0
,
7
9
4
0
,
7
–
9
4
0
,
7
9
4
0
,
7
i
a
s
y
a
a
M
l
l
a
t
o
T
i
a
s
e
n
o
d
n
I
n
a
t
n
a
m
i
l
a
K
0
0
0
$
a
k
g
n
a
B
u
a
R
i
0
0
0
$
0
0
0
$
h
t
u
o
S
a
r
t
a
m
u
S
0
0
0
$
l
u
u
k
g
n
e
B
0
0
0
$
h
t
r
o
N
a
r
t
a
m
u
S
i
n
o
g
e
r
y
b
g
n
i
t
r
o
p
e
r
y
r
a
m
i
r
P
n
o
i
t
a
m
r
o
f
n
i
t
n
e
m
g
e
S
6
–
–
–
–
–
–
–
–
)
8
(
0
5
3
,
1
)
2
6
4
(
2
4
3
,
1
0
8
8
)
9
(
0
0
1
0
0
0
$
–
–
–
–
–
–
–
–
)
1
(
6
4
5
,
1
–
5
4
5
,
1
5
4
5
,
1
5
4
5
,
1
–
–
0
8
2
,
1
3
0
8
2
,
1
3
3
1
2
3
5
0
,
3
1
)
5
1
1
,
3
(
6
6
2
,
3
1
1
5
1
,
0
1
)
6
4
9
,
4
(
1
9
4
,
9
2
)
6
2
9
,
5
(
5
4
5
,
4
2
9
1
6
,
8
1
)
7
8
7
(
9
2
8
,
1
0
0
0
$
–
2
0
5
,
8
1
2
0
5
,
8
1
0
2
3
7
7
8
,
6
7
9
1
,
7
)
9
8
0
,
2
(
8
0
1
,
5
)
5
9
3
,
6
(
4
2
9
,
7
2
)
8
4
6
,
5
(
9
2
5
,
1
2
1
8
8
,
5
1
)
9
1
6
(
9
0
7
,
3
–
–
–
–
–
–
–
–
)
5
4
(
7
3
4
,
3
1
)
0
3
6
,
2
(
2
9
3
,
3
1
2
6
7
,
0
1
)
0
2
(
5
5
6
,
2
1
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
2
4
6
3
3
,
3
5
8
7
3
,
3
5
6
2
2
,
1
9
2
1
,
5
1
)
7
5
7
,
4
(
5
5
3
,
6
1
8
9
5
,
1
1
3
5
9
,
6
7
)
4
7
5
,
3
3
(
)
0
5
4
,
7
(
9
7
3
,
3
4
9
2
9
,
5
3
8
6
1
,
3
)
5
7
1
,
1
(
0
0
0
$
9
7
3
2
,
2
4
6
4
2
,
2
4
)
0
9
6
(
3
8
9
,
3
1
)
4
4
6
,
3
(
3
9
2
,
3
1
9
4
6
,
9
3
6
7
,
1
7
)
3
8
1
,
7
3
(
)
7
3
4
,
7
(
0
8
5
,
4
3
3
4
1
,
7
2
3
2
3
,
4
)
2
7
1
,
1
(
6
3
3
6
8
6
,
2
8
2
2
0
,
3
8
)
7
3
1
(
5
2
9
,
6
4
8
8
7
,
6
4
)
8
0
4
3
1
(
,
0
8
3
,
3
3
)
2
8
7
,
8
(
4
1
1
,
2
2
1
)
2
5
8
1
2
(
,
2
3
3
,
3
1
1
0
8
4
,
1
9
1
8
4
,
9
)
7
1
0
,
2
(
0
0
0
$
6
4
2
8
0
0
,
1
6
4
5
2
,
1
6
0
6
3
,
1
6
8
8
,
9
2
)
1
9
8
,
9
(
6
4
2
,
1
3
5
5
3
,
1
2
)
4
3
7
,
8
(
8
0
9
,
7
2
1
)
1
1
0
8
1
(
,
4
7
1
,
9
1
1
3
6
1
,
1
0
1
)
7
8
5
,
1
(
3
4
4
,
0
1
e
u
n
e
v
e
r
s
e
a
s
l
l
a
t
o
T
8
0
0
2
)
l
a
n
r
e
t
x
e
l
l
a
(
e
m
o
c
n
i
r
e
h
t
O
e
u
n
e
v
e
r
l
a
t
o
T
x
a
t
e
r
o
f
e
b
)
s
s
o
l
(
/
t
fi
o
r
P
t
n
e
m
e
v
o
m
A
B
d
n
a
t
n
e
m
e
v
o
m
A
B
x
a
t
e
r
o
f
e
b
)
s
s
o
l
(
/
t
fi
o
r
P
x
a
T
r
a
e
y
e
h
t
r
o
f
t
fi
o
r
P
s
t
e
s
s
a
t
n
e
m
g
e
S
x
a
T
s
t
e
s
s
a
t
e
N
s
e
i
t
i
l
i
b
a
L
i
s
t
e
s
s
A
e
r
u
t
i
d
n
e
p
x
e
l
a
t
i
p
a
C
i
n
o
i
t
a
c
e
r
p
e
D
e
u
n
e
v
e
r
s
e
a
s
l
l
a
t
o
T
7
0
0
2
)
l
a
n
r
e
t
x
e
l
l
a
(
e
m
o
c
n
i
r
e
h
t
O
e
u
n
e
v
e
r
l
a
t
o
T
x
a
t
e
r
o
f
e
b
)
s
s
o
l
(
/
t
fi
o
r
P
t
n
e
m
e
v
o
m
A
B
d
n
a
t
n
e
m
e
v
o
m
A
B
x
a
t
e
r
o
f
e
b
)
s
s
o
l
(
/
t
fi
o
r
P
x
a
T
r
a
e
y
e
h
t
r
o
f
t
fi
o
r
P
s
t
e
s
s
a
t
n
e
m
g
e
S
x
a
T
s
t
e
s
s
a
t
e
N
s
e
i
t
i
l
i
b
a
L
i
s
t
e
s
s
A
e
r
u
t
i
d
n
e
p
x
e
l
a
t
i
p
a
C
i
n
o
i
t
a
c
e
r
p
e
D
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
6
Segment information - continued
Secondary reporting format by crop:
Carrying amount of
segment assets
External income
Profit/(loss)
before tax
By activity:
Oil palm
Rubber
2008
$000
2007
$000
2008
$000
2007
$000
2008
$000
153,313
2,963
146,584
2,065
172,367
2,317
125,663
2,235
75,980
1,892
Gross profit
–
BA movement
Administration expenses
–
Unallocated assets/income/(expenses) 36,013
–
Interest
–
–
29,689
–
–
–
–
–
77,872
1,347
(3,808)
1,503
959
–
–
–
–
2007
$000
53,791
1,810
55,601
1,001
(3,646)
781
(145)
192,289
178,338
174,684
127,898
77,873
53,592
7
Employees’ and directors’ remuneration
Average numbers employed (primarily overseas) during the year
- full time
- casual
Staff costs (including directors) comprise:
Wages and salaries
Social security costs
Retirement benefit costs (note 18)
Share based remuneration expense (equity settled)
2008
number
3,582
5,007
2008
$000
13,873
195
533
–
2007
number
3,467
4,830
2007
$000
10,300
227
1,112
87
14,601
11,726
The information required by the Companies Act and the listing rules of the Financial Services Authority is contained in the
directors’ report on remuneration on pages18 and 19 of which the information on page 19 has been audited.
Directors emoluments
Pension contributions
Remuneration expense for key management personnel
2008
$000
641
22
663
533
2007
$000
772
39
811
675
Executive directors are considered to be the only key management personnel: their remuneration is shown on page 19.
8
Tax
Foreign corporation tax - current year
Foreign withholding tax on remittances
Deferred tax adjustment - current year
Total tax charge for year
2008
$000
20,552
4,550
789
2007
$000
14,356
499
773
25,891
15,628
The corporation tax rates in Indonesia and Malaysia, the group’s countries of operation, are close to the 28% standard rate
of corporation tax in the UK but the charge for the year differs from the standard UK rate of corporation tax for the reasons
below.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
8
Tax - continued
Profit before tax
Profit before tax multiplied by standard rate of UK corporation tax of 28% (2007 – 30%)
Effects of:
Rate adjustment relating to overseas profits
Group accounting adjustments not subject to tax
Expenses not allowable for tax
Temporary differences
Losses not offsetable against fellow subsidiary profits
Utilisation of tax losses brought forward
Foreign corporation tax charge for year
Foreign withholding tax
Deferred tax adjustments (note 17)
2008
$000
2007
$000
77,873
53,592
21,804
16,077
1,129
(1,080)
244
(904)
55
(696)
20,552
4,550
789
(15)
(575)
147
(265)
97
(1,110)
14,356
499
773
Total tax charge for year
25,891
15,628
9
Earnings per ordinary share (EPS)
Profit for the year attributable to equity holders of the parent company before BA adjustment
Net BA adjustment
Earnings used in basic and diluted EPS
Weighted average number of shares in issue in year
- used in basic EPS
- dilutive effect of outstanding share options
- used in diluted EPS
Basic EPS before BA adjustment
Basic EPS after BA adjustment
There is no significant difference between basic and diluted EPS.
10
Dividends
Paid during the year
Final dividend of 14 cts per ordinary share for the year
ended 31 December 2007 (2006 – 10.8 cts)
Proposed final dividend of 5.0 cts per ordinary share for the year
ended 31 December 2008 (2007 – 14 cts)
2008
$000
41,182
819
2007
$000
30,485
515
42,001
31,000
Number
‘000
39,976
101
Number
‘000
39,480
65
40,077
39,545
103.0
105.1
77.2 cts
78.5 cts
2008
$000
2007
$000
5,112
4,266
1,973
5,524
The proposed dividend for 2008 is subject to shareholder approval at the forthcoming annual general meeting and has not
been included as a liability in these financial statements.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
11
Biological assets, property, plant and equipment
Cost or valuation
At 1 January 2007
Exchange translations
Revaluations
Additions
Estates acquired at valuation on
acquisition of a subsidiary
Disposals
Non-
biological
plantation
assets
$000
111,006
(3,054)
2,945
6,524
13,870
(83)
Total
property
plant and
equipment
$000
131,193
(3,894)
2,945
8,982
13,870
(181)
Mills
$’000
20,187
(840)
–
2,458
–
(98)
Biological
assets
$’000
33,255
(670)
1,006
3,368
1,621
–
Total
$’000
164,448
(4,564)
3,951
12,350
15,491
(181)
At 31 December 2007
131,208
21,707
152,915
38,580
191,495
Exchange translations
Revaluations
Additions
Estates acquired at valuation on
acquisition of a subsidiary
Disposals
At 31 December 2008
Accumulated depreciation
and impairment
At 1 January 2007
Exchange translations
Revaluations
Charge for the year
Disposals
At 31 December 2007
Exchange translations
Revaluations
Charge for the year
Disposals
At 31 December 2008
Carrying amount
At 31 December 2007
At 31 December 2008
(16,743)
–
17,854
11,363
(333)
(2,356)
–
1,884
–
(75)
(19,099)
–
19,738
11,363
(408)
(5,706)
5,969
–
–
–
(24,805)
5,969
19,738
11,363
(408)
143,349
21,160
164,509
38,843
203,352
–
–
2,505
(2,505)
–
–
–
3,083
(3,083)
–
–
(3,625)
175
–
(1,094)
72
(4,472)
177
818
(1,047)
27
(4,497)
(3,625)
175
2,505
(3,599)
72
(4,472)
177
3,901
(4,130)
27
(4,497)
–
–
665
(665)
–
–
–
772
(772)
–
–
(3,625)
175
3,170
(4,264)
72
(4,472)
177
4,673
(4,902)
27
(4,497)
131,208
143,349
17,235
16,663
148,443
160,012
38,580
38,843
187,023
198,855
The directors valued the estates (comprising biological assets, non-biological plantation assets, plantation infrastructure
and oil mills) at 31 December 2008 and 2007 at value in use derived from discounted estimated future cash flows of each
estate. Among the principal assumptions underlying the calculations were an assumed CPO selling price CIF Rotterdam
of $500/mt (2007 - $500/mt) and a discount rate of 12% (2007 – 12%). These values were reviewed at December 2006
by P.T. Nagadi Ekasakti, Jakarta based consultants, who are familiar with the properties and the necessary assumptions
underlying the calculations. Biological assets are estimated as a proportion of these calculations. The Indonesian estates
have been included at values in use.
The assumption of $500/mt price represents the directors’ current estimate of the long term average CPO price based on
current market expectations. Pricing CPO is the result of a complex relationship between competing oils and mills, oil seed
production in both hemispheres and, to a certain extent, a correlation with crude oil. Actual experience may therefore differ
from these estimates and assumptions. A $10 change in the CPO price, at the year-end exchange rate, results in an increase
or decrease in valuation of $7.3m, but no significant impact on the income statement.
The Malaysian estates were professionally valued by PPC International, Kuala Lumpur based valuers, in December 2006 on
an open market existing use basis and are included at this valuation less potential sale costs, plus additions during 2007.
The estates include $42,000 (2007: $106,000) of interest and $3,303,000 (2007: $2,144,000) of overheads capitalised during
the year in respect of expenditure on estates under development.
Original cost and depreciation at historical rates of exchange of the estates at 31 December 2008:
Original cost
Cumulative depreciation based on original cost
Estates
$000
195,173
(37,523)
157,650
Mills
$000
31,218
(10,901)
Total
$000
226,391
(48,424)
20,317
177,967
The Indonesian authorities have granted certain land exploitation rights and operating permits for the estates. In the case
of established estates in North Sumatra these rights and permits expire between 2023 and 2026 with rights of renewal
thereafter for periods from 35 to 60 years. In the case of estates in Bengkulu land titles were issued between 1993 and
2002 and the titles expire between 2028 and 2032 with rights of renewal thereafter for two consecutive periods of 25 and 35
years respectively. In the case of estates in Riau, land titles were issued in 2003 and expire in 2033; in the case of CPA’s
estate acquired in 2007 (as set out in note 26) land titles were issued in 1996 to expire in 2029.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
11
Biological assets, property, plant and equipment - continued
In both cases there are subsequent rights of renewal similar to those in Bengkulu. Renewal is subject to compliance with
the laws and regulations of Indonesia. As described in note 1 the values in use of the Indonesian estates are depreciated
over a period of fifty years, since the directors expect the renewals will take place. Land acquired during 2007 and 2008 as
set out in note 26 is held under temporary “rights to occupy”, pending issue of formal land exploitation rights.
The land title of the estate in Malaysia is a long lease expiring in 2084.
12
Receivables: non-current
Due from minority shareholders
Due from village smallholder schemes
2008
$000
1,363
314
1,677
2007
$000
1,363
314
1,677
The minority shareholders in PT Alno Agro Utama and PT Cahaya Pelita Andhika have acquired their interests on deferred
terms (see note 25, Credit risk). The minority shareholder in PT Mitra Puding Mas repaid his debt of $286,000 during
2007.
Amounts due from village smallholder schemes represents expenditure on planting and maintaining to maturity oil palms
on communal land owned by 21 separate villages neighbouring the group’s estates.
The book values of the amounts due from minority shareholders and village smallholder schemes approximates their fair
values.
13
Inventories
Estate and mill consumables
Processed produce for sale
14
Trade and other receivables
Trade receivables
Other receivables
Accrued interest receivable
Prepayments
2008
$000
3,510
686
4,196
2008
$000
390
3,402
156
195
4,143
15
Bank loans and other financial liabilities
2008
2007
Bank overdraft (a)
Bank overdraft (b)
Long term development loan (c)
Long term development loan (d)
Long term development loan (e)
Total bank loans
Finance lease obligations (f)
Total bank loans and lease obligations
Amounts repayable after more than one year,
as follows:
in more than one year but not more than two years
in more than two years but not more than five years
in more than five years but not more than six years
in more than six years but not more than seven years
under one
year
$000
1
3,000
1,250
400
2,588
7,239
54
7,293
under one
year
$000
1
–
938
800
6,900
8,639
–
8,639
more than
one year
$000
–
–
–
2,000
25,013
27,013
12
27,025
9,437
11,150
6,438
–
27,025
2007
$000
3,505
1,405
4,910
2007
$000
343
723
156
240
1,462
more than
one year
$000
–
–
938
2,800
31,912
35,650
69
35,719
8,689
9,442
11,150
6,438
35,719
The carrying amount of trade and other receivables approximates to their fair value.
(a)
(b)
The bank overdraft is secured by a fixed and floating charge over the land titles and assets of the parent company’s
Malaysian operating subsidiary, Anglo-Eastern Plantations (M) Sdn Bhd (“AEP Malaysia”) as well as over the parent
company’s shareholding in AEP Malaysia. The parent company has guaranteed the overdraft. Interest is at 2% above
Malaysian Bank Lending Rate or about 8.75% (2006: 8.75%).
The bank overdraft was made available in June 2007 and is secured by a fixed charge on the land titles of PT Musam
Utjing. The parent company has guaranteed the overdraft which was fully repaid in January 2008. Interest is at 2.67%
over the Singapore Interbank Lending Rate (SIBOR) or about 7.7%.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
15
Bank loans and other financial liabilities - continued
(c)
(d)
(e)
The long term development loan, which is part of an original facility of $5,000,000, was made in July 2004 to, and
secured by a fixed and floating charge on the land titles and other assets of, PT Bina Pitri Jaya. The parent company
has guaranteed the loan. Interest was at 4% under the US dollar Indonesian prime rate or about 5.6% (2007: 7.9%).
The loan is repayable in sixteen quarterly instalments of $312,500 from October 2005 to July 2009.
The long term development loan of $2,800,000 (2007: $3,200,000), to part finance construction of a mill, was made
in September 2006 to, and secured by a fixed and floating charge on the land titles and other assets of, PT Bina Pitri
Jaya. This loan bears interest rate at 5.5% below the Bank’s prime lending rate per annum. The loan is repayable in
sixteen quarterly instalments of $200,000 from July 2008 to April 2012.
The long term development loan of $31,913,000 (2007: $34,500,000) to finance the purchase and development of
new land or developed estates, was made in June and July 2007. It is secured by a fixed and floating charge on
the land titles and other assets of PT Alno Agro Utama and of PT Tasik Raja (Tasik) and is guaranteed by Tasik and
by the parent company. Interest is at 3% over SIBOR up to the month of September 2008. However, interest was
revised based on DBS’s cost of funds from October 2008 onwards. Interest for 2008 was about 6.2% (2007: 8.3%).
The loan is repayable from August 2008 over four years in quarterly instalments amounting for each 12 months to
15%; 25%; 25% and 35% of the loan.
(f)
Finance lease obligations relate to vehicles and machinery, on which the obligations are secured, in the Malaysian
subsidiaries. Interest is effectively fixed at 3.0%.
16
Trade and other payables
Trade creditors
Other creditors
Accruals
17
Deferred tax liabilities
Year end (liability) relates to
Revaluation surplus
Unutilised tax losses
Other temporary differences
Movement:
At beginning of year (liability)
(Charge) to
- income statement
- equity: revaluation and exchange reserve
Exchange adjustment
At end of year (liability)
Details of movement in 2008
Revaluation surplus
Accelerated capital allowances
Employee pension liabilities
Other temporary and deductible differences
Available losses
Details of movements in 2007
Revaluation surplus
Accelerated capital allowances
Employee pension liabilities
Other temporary and deductible differences
Available losses
Anglo-Eastern Plantations Plc I Annual Report 2008
2008
$000
1,041
7,004
2,704
10,749
2008
$000
(27,800)
130
(780)
(28,450)
2007
$000
3,405
3,951
1,955
9,311
2007
$000
(22,652)
95
(468)
(23,025)
(23,025)
(21,152)
(789)
(1,128)
(3,508)
(773)
(1,186)
86
(28,450)
(23,025)
(Charged)/
credited to
income
2008
$000
(420)
(25)
74
(473)
55
(Charged)/
credited to
reserves
2008
$000
(1,128)
–
–
–
–
(Liability)
2008
$000
(27,800)
(67)
363
(1,076)
130
(28,450)
(789)
(1,128)
(Charged)/
credited to
income
2007
$000
(300)
(15)
200
(431)
(227)
(Charged)/
credited) to
reserves
2007
$000
(1,186)
–
–
–
–
(773)
(1,186)
Liability
2007
$000
(22,652)
(52)
346
(762)
95
(23,025)
Notes to the
Consolidated Financial Statements
17
Deferred tax liabilities - continued
A deferred tax asset has not been recognised for the following items:
Unutilised tax losses
18
Retirement benefits
2008
$000
9,309
2007
$000
13,181
The group maintains a defined benefit funded pension scheme for some employees in Indonesia. The scheme is valued
by an actuary at the end of each financial year. Any excess of the actuarial liability over the fund assets is provided and
charged to the income statement. The major assumptions used by the actuary were:
Inflation
Rate of increase in wages
Discount rate
2008
10%
8%
12%
2007
10%
10%
12%
2006
10%
10%
12%
2005
10%
10%
12%
2004
10%
10%
12%
The group also operates a non-contributory non-funded retirement plan for staff in Indonesia. Retirement benefits are paid
to employees in a single lump sum at the time of retirement. Retirement benefit is accrued by the group and charged in the
income statement based on individual employees’ service up to the end of the financial year.
Defined
benefit
- funded
schemes
2008
$000
Reconciliation to balance sheet
Scheme assets (all cash)
Scheme (liabilities)
Net assets/(liabilities)
Reconciliation of scheme assets
At beginning of year
Exchange gain/(loss)
Contributions by group
Income
Benefits paid
Expenses
At end of year
1,241
(1,408)
(167)
1,195
(195)
187
112
(53)
(5)
1,241
Reconciliation of scheme (liabilities)
At beginning of year
Exchange (loss)/gain
Current service (cost)/write back
Benefits paid
(1,408)
222
(275)
53
At end of year
(1,408)
Defined
benefit –
unfunded
schemes
2008
$000
–
(1,327)
(1,327)
–
–
–
–
–
–
–
(1,321)
255
(308)
47
(1,327)
Total
2008
$000
1,241
(2,735)
(1,494)
1,195
(195)
187
112
(53)
(5)
1,241
(2,729)
477
(583)
100
(2,735)
The charge/(credit) for the year for retirement benefit comprises:
Defined benefit funded scheme
Current service cost
Expenses
Income
Defined benefit unfunded scheme
Current service cost
Defined contribution schemes
Contributions
Defined
benefit
- funded
schemes
2007
$000
1,195
(1,408)
(213)
1,032
(49)
192
92
(66)
(6)
1,195
(906)
53
(621)
66
Defined
benefit –
unfunded
schemes
2007
$000
–
(1,321)
(1,321)
–
–
–
–
–
–
–
(960)
31
(535)
143
(1,408)
(1,321)
2008
$000
275
5
(112)
168
308
57
533
2007
$000
621
6
(107)
520
535
57
1,112
Total
2007
$000
1,195
(2,729)
(1,534)
1,032
(49)
192
92
(66)
(6)
1,195
(1,866)
84
(1,156)
209
(2,729)
2006
$000
134
4
(66)
72
475
48
595
The best estimate of expected contribution in 2009 is $500,000.
19
Share capital
Authorised
Number
Issued and
fully paid
Number
Authorised
£000
Issued and
fully paid
£000
Authorised
$000
Issued and
fully paid
$000
Ordinary shares of
25p each
Beginning and end of year 60,000,000
39,976,272
15,000
9,994
23,865
15,504
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
19
Share capital - continued
Treasury shares
Beginning of year
Purchased in year
End of year
Market value of treasury shares:
Beginning of year (447.5p/share)
End of year (272.5p/share)
2008
Number
518,000
–
2007
Number
468,000
50,000
2008
$’000
(1,785)
–
2007
$’000
(1,387)
(398)
518,000
518,000
(1,785)
(1,785)
4,659
1,990
No treasury shares were purchased in 2008 (2007: 50,000 purchased at 386p/share).
20
Share based payment
Options have been granted under the company’s 1994 Executive Share Option Scheme and Overseas Share Option Scheme
and the 2005 Unapproved Executive Share Option Scheme to subscribe for ordinary shares of 25p each of the company
as follows:
Price
Date of grant per share
44.7p
16.04.02
108.5p
21.05.03
181.2p
13.05.04
234.0p
19.05.06
323.25p
09.10.06
360.3p
21.05.07
598.0p
03.06.08
Period of option
30.04.05 – 29.04.12
21.05.06 – 20.05.13
13.05.07 – 12.05.14
19.05.09 – 18.05.16
09.10.09 – 08.10.16
21.05.10 – 20.05.17
03.06.11 – 02.06.18
1 Jan 07 Granted Exercised
–
(18,000)
–
–
–
–
–
–
–
–
–
–
78,300
–
30,600
20,400
30,000
51,200
15,500
–
–
31 Dec 07 Granted Exercised 31 Dec 08
30,600
2,400
30,000
51,200
15,500
78,300
97,700
–
–
–
–
–
–
97,700
30,600
2,400
30,000
51,200
15,500
78,300
–
–
–
–
–
–
–
–
147,700
78,300
(18,000)
208,000
97,700
–
305,700
Exercisable
51,000
63,000
63,000
Options granted to directors, included above, are shown on page 19.
The weighted average contracted life of options outstanding at the end of the year was 7.7 years (2007 – 8 years) and the
weighted average exercise price was 362p (2007 – 251p). The weighted average exercise price of options exercisable at
the end of the year was 112p (2007 – 112p).
The weighted average share price at date of exercise of options exercised in prior year was 360p. No options were exercised
for the year. 97,700 share options were granted in 2008 (2007 - 78,300).
The aggregate of the estimated fair value of options granted in 2008 was $216,000 (2007: $171,000). The assumptions
applied in the binomial model used to calculate this fair value were:
Weighted average share price at grant date
Weighted average exercise price
Weighted average contracted life
Weighted average expected period to exercise
Expected volatility
Risk Free rate
Expected dividend yield
2008
608p
N/A
10 years
3.5years
25%
5%
2%
2007
385p
360p
10 years
3.5 years
25%
5%
2%
There are no vesting conditions other than that option holders may exercise their options at any time within three and ten
years after grant, provided they remain employees of the group for a period of three years from date of grant.
21
Ultimate controlling shareholder and related party transactions
At 31 December 2008 Genton International Limited, a company registered in Hong Kong, held 20,247,814 (2007 – 20,247,814)
shares of the company representing 50.6% (2007 – 50.6%) of the issued share capital of the company. Together with other
deemed interested parties, the company ‘s shareholding totals 20,521,314 or 51.3%. Madam Lim, a director of the company,
has advised the company that she is the controlling shareholder of Genton International Limited.
During the year a subsidiary of the company managed, for a fee of $21,000 (2007 - $17,000), small plantations owned by
companies controlled by Madam Lim. This contract is on an arm’s length basis. At 31 December 2008 the amount due
under this contract was $1,500 (2007 - $4,000).
During the year the Company engaged UHY Hacker Young, an accounting firm of which Dato’ John Lim Ewe Chuan is a
partner, to provide company secretarial and taxation services for a fee of $49,502 (2007 - Nil). This contract is on an arm’s
length basis.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
l
a
t
o
T
y
t
i
u
q
e
0
0
0
$
’
7
7
3
,
7
4
1
y
t
i
r
o
n
M
i
s
t
s
e
r
e
t
n
i
0
0
0
$
’
1
2
4
,
5
2
l
a
t
o
T
0
0
0
$
’
6
5
9
,
1
2
1
0
0
0
$
’
0
5
4
,
0
8
i
d
e
n
a
t
e
R
i
s
g
n
n
r
a
e
0
0
0
$
’
e
v
r
e
s
e
r
)
1
4
2
,
1
7
(
i
n
g
e
r
o
F
e
g
n
a
h
c
x
e
e
r
a
h
S
l
a
t
i
p
a
c
e
v
r
e
s
e
r
0
0
0
$
8
4
6
,
3
7
0
0
0
$
’
7
8
0
,
1
e
v
r
e
s
e
r
0
0
0
$
’
4
0
9
,
3
2
i
m
u
m
e
r
p
0
0
0
$
’
s
e
r
a
h
s
)
7
8
3
,
1
(
n
o
i
t
a
u
a
v
e
R
l
n
o
i
t
p
m
e
d
e
r
e
r
a
h
S
y
r
u
s
a
e
r
T
e
r
a
h
S
l
a
t
i
p
a
c
0
0
0
$
’
5
9
4
,
5
1
3
2
8
,
4
)
6
8
1
,
1
(
)
2
3
9
,
5
(
)
5
9
2
,
2
(
4
6
9
,
7
3
)
8
9
3
(
)
7
1
3
,
5
(
9
6
6
,
5
3
0
4
7
6
9
)
2
5
4
(
)
4
3
9
(
2
5
4
,
1
6
6
4
6
9
,
6
–
–
7
6
9
0
3
0
,
7
)
1
5
0
,
1
(
)
4
3
7
(
1
7
3
,
3
)
8
9
9
,
4
(
)
1
6
3
,
2
(
0
0
0
,
1
3
–
0
4
)
8
9
3
(
)
6
6
2
,
4
(
9
3
6
,
8
2
–
–
–
–
–
–
–
0
0
0
,
1
3
)
6
6
2
,
4
(
0
0
0
,
1
3
–
)
0
6
1
(
)
8
9
9
,
4
(
–
)
8
5
1
,
5
(
–
)
4
7
5
(
1
7
3
,
3
–
7
9
7
,
2
–
–
–
–
–
–
–
–
)
8
5
1
,
5
(
7
9
7
,
2
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1
3
–
–
–
–
–
–
–
–
–
)
8
9
3
(
–
–
–
–
–
–
–
–
9
–
s
t
s
e
r
e
t
n
i
i
y
t
i
r
o
n
m
d
n
a
s
e
v
r
e
s
e
R
2
2
n
o
i
t
l
a
s
n
a
r
t
e
g
n
a
h
c
x
e
n
o
)
s
s
o
L
(
n
o
i
t
l
a
u
a
v
e
r
n
o
x
a
t
d
e
r
r
e
f
e
D
y
t
i
u
q
e
n
i
s
e
g
n
a
h
c
t
c
e
r
i
D
s
e
a
t
t
s
e
f
o
n
o
i
t
a
u
a
v
e
r
l
n
o
l
s
u
p
r
u
s
d
e
s
i
l
a
e
r
n
U
7
0
0
2
r
o
f
y
l
t
c
e
r
i
d
i
d
e
s
n
g
o
c
e
r
e
m
o
c
n
i
t
e
N
d
o
i
r
e
p
r
o
f
t
fi
o
r
P
y
t
i
u
q
e
n
i
7
0
0
2
y
r
a
u
n
a
J
1
t
a
e
c
n
a
l
a
B
d
n
a
e
m
o
c
n
i
i
d
e
s
n
g
o
c
e
r
l
a
t
o
T
r
a
e
y
e
h
t
r
o
f
e
s
n
e
p
x
e
d
e
r
i
u
q
c
a
i
i
s
e
i
r
a
d
s
b
u
s
n
i
t
s
e
r
e
t
n
I
n
o
i
t
p
i
r
c
s
b
u
s
l
a
t
i
p
a
c
e
r
a
h
S
d
e
s
a
h
c
r
u
p
s
e
r
a
h
S
i
d
a
p
s
d
n
e
d
v
D
i
i
8
3
3
,
8
7
1
7
6
3
,
2
3
1
7
9
,
5
4
1
4
8
1
,
7
0
1
)
9
9
3
,
6
7
(
5
4
4
,
6
7
7
8
0
,
1
5
3
9
,
3
2
)
5
8
7
,
1
(
4
0
5
,
5
1
7
0
0
2
r
e
b
m
e
c
e
D
1
3
t
a
e
c
n
a
l
a
B
2
0
3
,
5
)
8
2
1
,
1
(
)
4
4
9
,
9
2
(
)
0
2
2
(
2
3
6
,
1
)
3
5
0
,
5
(
)
8
0
9
(
0
7
6
,
3
)
1
9
8
,
4
2
(
)
0
7
7
,
5
2
(
2
8
9
,
1
5
)
1
4
6
,
3
(
1
8
9
,
9
)
9
2
1
,
2
2
(
1
0
0
,
2
4
1
0
0
,
2
4
–
–
–
–
–
–
)
5
7
3
(
)
1
9
8
,
4
2
(
)
6
6
2
,
5
2
(
–
)
3
3
5
(
0
7
6
,
3
–
7
3
1
,
3
8
9
5
2
1
2
,
6
2
)
9
5
8
,
2
1
(
8
9
5
0
4
3
,
6
)
7
4
7
,
7
(
–
)
2
1
1
,
5
(
2
7
8
,
9
1
–
)
2
1
1
,
5
(
1
0
0
,
2
4
–
–
–
–
)
6
6
2
,
5
2
(
7
3
1
,
3
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
8
0
0
2
r
o
f
y
t
i
u
q
e
n
i
s
e
g
n
a
h
c
t
c
e
r
i
D
n
o
i
t
l
a
u
a
v
e
r
n
o
l
s
u
p
r
u
s
d
e
s
i
l
a
e
r
n
U
n
o
i
t
l
a
s
n
a
r
t
e
g
n
a
h
c
x
e
n
o
)
s
s
o
L
(
n
o
i
t
l
a
u
a
v
e
r
n
o
x
a
t
d
e
r
r
e
f
e
D
s
e
t
a
t
s
e
f
o
y
l
t
c
e
r
i
d
i
d
e
s
n
g
o
c
e
r
e
m
o
c
n
i
t
e
N
d
o
i
r
e
p
r
o
f
t
fi
o
r
P
y
t
i
u
q
e
n
i
d
n
a
e
m
o
c
n
i
i
d
e
s
n
g
o
c
e
r
l
a
t
o
T
d
o
i
r
e
p
e
h
t
r
o
f
e
s
n
e
p
x
e
d
e
r
i
u
q
c
a
i
i
s
e
i
r
a
d
s
b
u
s
n
i
t
s
e
r
e
t
n
I
i
d
a
p
s
d
n
e
d
v
D
i
i
9
8
2
,
2
9
1
8
5
5
,
1
3
1
3
7
,
0
6
1
3
7
0
,
4
4
1
)
5
6
6
,
1
0
1
(
2
8
5
,
9
7
7
8
0
,
1
5
3
9
,
3
2
)
5
8
7
,
1
(
4
0
5
,
5
1
8
0
0
2
r
e
b
m
e
c
e
D
1
3
t
a
e
c
n
a
l
a
B
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
22
Reserves and minority interests - continued
Nature and purpose of each reserve:
Share Capital
Amount of shares subscribed at nominal value.
Share premium
Amount subscribed for share capital in excess of nominal value.
Capital redemption
Amounts transferred from share capital on redemption of issued shares.
Treasury shares
Cost of own shares held in treasury.
Revaluation
Gains/loses arising on the revaluation of the group’s property.
Foreign exchange
Gains/losses arising on translating the net assets of overseas operations into dollars.
Retained earnings
Cumulative net gains and losses recognised in the consolidated income statement.
23
Guarantees and other financial commitments
Capital commitments at 31 December
Contracted but not provided
-
-
Authorised but not contracted
-
normal estate operations
normal estate operations
land acquisition
2008
$000
6,748
23,554
–
2007
$000
70
16,377
6,400
24
Finance leases
The group leases a few tractors and cars, included under non-biological plantation assets at a net carrying value $Nil (2007
- $163,000). Such assets are classified as finance leases as the rental period amounts to the estimated useful economic
life of the assets concerned and the group has the right to purchase the assets outright at the end of the minimum lease
term by paying a nominal amount.
Future lease payments are due as follows:
2008
Nil
2007
Not later than one year
Later than one year and not later than five years
Minimum
lease
payments
2007
$’000
54
69
Interest
2007
$’000
6
8
Present
value
2007
$’000
48
61
123
14
109
25
Disclosure of financial instruments and other risks
The group’s principal financial instruments comprise cash, short and long term bank loans, trade receivables and payables
and receivables from local partners in respect of their investments.
0
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
25
Disclosure of financial instruments and other risks - continued
The group’s accounting classification of each class of financial asset and liability at 31 December 2008 and 2007 were:
2008
Non-current receivables
Trade and other receivables
Cash and cash equivalent
Borrowings due within one year
Trade and other payables
Borrowings due after one year
2007
Non-current receivables
Trade and other receivables
Cash and cash equivalent
Borrowings due within one year
Trade and other payables
Borrowings due after one year
Loans and
receivables
$000
1,363
4,143
69,442
–
–
–
Amortised
cost
$000
–
–
–
(8,639)
(10,749)
(27,025)
Total
carrying
value and
fair value
$000
1,363
4,143
69,442
(8,639)
(10,749)
(27,025)
74,948
(46,413)
28,535
Loans and
receivables
$000
1,363
1,462
66,358
–
–
–
Amortised
cost
$000
–
–
–
(7,293)
(9,311)
(35,719)
Total
carrying
value and
fair value
$000
1,363
1,462
66,358
(7,293)
(9,311)
(35,719)
69,183
(52,323)
16,860
The principal financial risks to which the group is exposed are:
- commodity selling price changes;
- exchange movements; and
which, in turn, can affect financial instruments and/or operating performance.
With the exception described below, the company does not hedge any of its risks. Its trade credit risks are low. There are
no financial assets or liabilities that are held at fair value through the profit and loss.
The board is directly responsible for setting policies in relation to financial risk management and monitors the levels of the
main risks through review of regular operational reports.
Commodity selling prices
The group does not normally contract to sell produce more than one month ahead. An exception was made in March 2007
when, believing the CPO price was already very favourable, and to secure the group’s cash flow for an impending acquisition,
33% of annual CPO production in Indonesia was sold forward through to December 2007.
A 1% change in the CPO and kernel selling price produces a 1% change in sales revenue less the level of export tax ruling
at the time. Profit is affected by an equal absolute amount.
Currency risk
Most of the group’s operations are in Indonesia. The parent company and group accounts are prepared in US dollars which
is not the functional currency of the operating subsidiaries. The group does not hedge its net investment in its overseas
subsidiaries and is therefore exposed to a currency risk on that investment. The historic cost of investment (including
intercompany loans) by the parent in its subsidiaries amounted to $79,783,000 (2007: $50,276,000), while the fair value of
the group’s share of underlying assets at 31 December 2008 amounted to $160,731,000 (2007 - $145,971,000).
All the group’s sales are made in local currency and any trade receivables are therefore denominated in local currency. No
hedging is therefore necessary.
However, selling prices of the group’s produce are directly related to the US dollar denominated world prices. Appreciation
of local currencies therefore reduces profits and cash flow of the Indonesian and Malaysian subsidiaries in terms of local
currency and, to a lesser extent, US dollar consolidated profits – and vice versa. It is not practical to hedge this currency
risk.
The group’s subsidiaries which are borrowing in US dollars, as set out under Liquidity Risk below could face significant
exchange losses in the event of depreciation of their local currency – and vice versa. This risk is mitigated by dollar
denominated cash balances in those subsidiaries. While the company was in a position to match dollar cash balances with
dollar financial liabilities throughout 2007 and 2008, policy has been for only a partial but increasing match because interest
rates on local currency deposits were some 6.22% higher than on dollar deposits and about the same as dollar borrowing
costs. The unmatched balance at 31 December 2008 is represented by the $16,034,000 shown in the table below (2007:
$24,258,000). If the group’s net cash position continues to improve then dollar cash balances will continue to be increased
through 2009 – eventually to match dollar liabilities.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
25
Disclosure of financial instruments and other risks - continued
Currency risk - continued
A 1% change in the rupiah:dollar exchange rate would have caused a gain or less on exchange of $160,340 at 31 December
2008 (2007: $242,000).
The table below shows the net monetary assets and liabilities of the group at 31 December 2008 and 2007 that were not
denominated in the operating or functional currency of the operating unit involved.
Functional currency of group operation
2008
Indonesian rupiah
US dollar
Total
2007
Indonesian rupiah
US dollar
Total
Net foreign currency assets/(liabilities)
US dollar
$000
Ringgit
$000
Sterling
$000
Total
$000
(16,034)
–
(16,034)
$000
(24,258)
–
–
(26)
(26)
$000
–
(26)
–
(549)
(16,034)
(575)
(549)
(16,609)
$000
–
(62)
$000
(24,258)
(88)
(24,258)
(26)
(62)
(24,346)
Liquidity risk
Development to profitability of new sizable plantations requires a period of between six and seven years before cash flow
turns positive. Because oil palms do not begin yielding significantly until four years after planting, this period and the cash
requirement is little affected by changes in commodity prices.
The group attempts to ensure that it is likely to have either self-generated funds or further loan/equity capital to complete
its development plans and to meet loan repayments. Long term forecasts are updated about twice a year for review by the
board. In the event that falling commodity prices reduce self-generated funds below expectations and to a level where group
resources may be insufficient, further new planting may be restricted. Consideration is given to the funds continued to be
required to bring existing immature plantings to maturity.
The group’s trade and tax payables are all due for settlement within a year. At 31 December 2008 the group had the following
loans and facilities.
Malaysia:
ringgit denominated
- overdraft
Indonesia: US dollar denominated
- overdraft
- long term loan
Borrowings
$000
Facilities
$000
Repayable
1
907
on demand
–
35,650
3,000
39,888
on demand
2008 - 2012 (note 15)
The Indonesian overdraft was repaid in full in January 2008. The facility remained in place and will be reviewed monthly
through 2008. The Malaysian overdraft facility is reviewed annually. The total long term loan facilities of $35,651,000 together
with interest at current rates is repayable as follows:
Principal
Interest
Total
2009
$000
8,638
2,569
2010
$000
9,424
1,829
2011
$000
11,150
985
11,207
11,253
12,135
2012
$000
6,439
264
6,703
In the event of a prolonged adverse movement in the CPO price the group would consider refinancing these borrowings
into a longer term loan stock.
Forecasts prepared in December 2008 indicate that the group has sufficient funds to meet its development plans and financial
commitments through 2009.
All the long term loans include varying covenants covering minimum net worth and cash balances, dividend and interest
cover and debt service ratios.
Interest rate risk
Both the group’s surplus cash and its borrowings are subject to variable interest rates. The group had net cash throughout
2008, so the effect of variations in borrowing rates is more than offset. A 1% change in the borrowing or deposit interest
rate would not have a significant impact on the groups’ reported results. The rates on borrowings are set out in note 15.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
25
Disclosure of financial instruments and other risks - continued
Interest rate risk - continued
There is no policy to hedge interest rates, partly because of the net cash position and partly because net interest is a relatively
small proportion of group profits.
Interest rate profiles of the group’s financial assets (comprising non current receivables, tax receivables, trade and other
receivables and cash) at 31 December 2008 were:
2008
Sterling
US dollar
Rupiah
Ringgit
Total
2007
Sterling
US dollar
Rupiah
Ringgit
Total
Total
$000
691
21,290
47,763
6,279
76,023
$000
104
22,982
45,392
2,894
71,372
Fixed rate Variable rate
$000
1
19,907
43,745
5,789
$000
–
1,363
–
–
No interest
$000
690
20
4,018
490
1,363
$000
–
1,363
–
–
1,363
69,442
$000
60
21,598
42,220
2,479
66,357
5,218
$000
44
21
3,172
415
3,652
Long term receivables of $1,363,000 (2007 - $1,363,000) comprise dollar denominated amounts due from minority
shareholders as described in note 12 on which interest is due at a fixed rate of 6%.
Average US dollar deposit rates in 2008 were 4.23% (2007 – 4.5%) and rupiah deposit rates were 10.45% (2007
– 8.1%).
Interest rate profiles of the group’s financial liabilities (comprising bank loans and other financial liabilities, trade and other
payables, tax liabilities and retirement benefit liabilities) at 31 December were:
2008
Sterling
US dollar
Rupiah
Ringgit
Total
2007
Sterling
US dollar
Rupiah
Ringgit
Total
Total
$000
(142)
(35,664)
(10,992)
(1,097)
(47,895)
$000
(166)
(44,010)
(8,654)
(1,028)
(53,858)
Fixed rate Variable rate
$000
–
(35,651)
–
(1)
$000
–
–
–
–
No interest
$000
(142)
(13)
(10,992)
(1,096)
–
(35,652)
(12,243)
$000
–
–
–
(123)
(123)
$000
–
(42,888)
–
(1)
$000
(166)
(1,122)
(8,654)
(904)
(42,889)
(10,846)
Weighted average interest rate on variable rate borrowings was 6.12% in 2008 (2007: 8.1%).
Credit risk
CPO and kernel amounting to 97% of group revenue are not despatched unless payment has been received in advance.
Remaining sales are on credit for about 30 days. No provisions were considered necessary at 31 December 2008 (2007
– nil).
All cash is deposited with licensed banks. The list of the principal banks used by the group is given on the inside of the back
cover of this report.
Amounts receivable from local partners, amounting to $1,363,000, in relation to their investments in operating subsidiaries
are secured on those investments and are repayable from their share of dividends from those subsidiaries. Amounts due
from village smallholder schemes are unsecured and are to be repaid from FFB supplied.
Capital
The group defines its Capital as Share capital and Reserves, shown in the consolidated balance sheet as “Equity attributable
to equity holders of the parent” and amounting to $160,731,000 at 31 December 2008. (2007: $145,971,000)
Group policy is presently to attempt to fund development from self-generated funds and loans and not from issue of new
share capital. At 31 December 2008 (2007: Nil) the group had no net borrowings but, depending market conditions, the
board is prepared for the group to have net borrowings.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
26
Acquisitions
For each of the acquisitions below, since they were not active plantations, the directors consider that they have obtained
control of an entity that is not a business and accordingly have not accounted for these acquisitions as business combinations.
Instead, the amount paid for each acquisition has been allocated between individual identifiable assets and liabilities in the
entity based on their fair values at the acquisition date.
2008
(1)
PT Riau Agrindo Agung
In January 2008, the group acquired a 95% interest in PT Riau Agrindo Agung (RAA) for a cash consideration of
$3,676,000. RAA has no assets or liabilities other than the right to a land title over 15,000 ha near the group’s existing
estates in Bengkulu. Plantable area is approximately 70%. The assets and liabilities and their fair value adjustment
were assessed as follows:
Fixed assets only acquired
Group share (95%)
Book value
$000
1,369
Revaluation to fair value
$000
2,501
Fair value
$000
3,870
3,676
RAA was inactive throughout 2008 and therefore the group’s share of any profit or loss from the date of acquisition
to the end of 2008 was nil.
(2)
PT Karya Kencana Sentosa Tiga
In June 2008, the group acquired a 95% interest in PT Karya Kencana Sentosa Tiga (KKST) for a cash consideration
of $4,086,000. KKST has no assets or liabilities other than the right to a land title over 16,000 ha near the group’s
existing estates in Bengkulu. Plantable area is approximately 70%. The assets and liabilities and their fair value
adjustment were assessed as follows:
Fixed assets only acquired
Group share (95%)
Book value
$000
913
Revaluation to fair value
$000
3,388
Fair value
$000
4,301
4,086
KKST was inactive throughout 2008 and therefore the group’s share of any profit or loss from the date of acquisition
to the end of 2008 was nil.
(3)
PT Empat Lawang Agro Perkasa
In July 2008, the group acquired a 95% interest in PT Empat Lawang Agro Perkasa (ELAP) for a cash consideration
of $3,601,000. ELAP has no assets or liabilities other than the right to a land title over 14,100 ha near the group’s
existing estates in Bengkulu. Plantable area is approximately 70%. The assets and liabilities and their fair value
adjustment were assessed as follows:
Fixed assets only acquired
Group share (95%)
Book value
$000
913
Revaluation to fair value
$000
2,877
Fair value
$000
3,790
3,601
ELAP was inactive throughout 2008 and therefore the group’s share of any profit or loss from the date of acquisition
to the end of 2008 was nil.
(4) Other Acquisitions – Land Rights
Also in January 2008 the group’s subsidiary PT Hijau Pryan Perdana acquired for a consideration of $600,000 the
right to a land title over a further 2,379 ha of land contiguous to its existing rights over 3,715 ha.
In March 2008 the group’s subsidiary PT Cahaya Pelita Andhika was able to restore, at minimal cost, a previously
lapsed right to a land title over a further 1,300 ha of land contiguous to its existing confirmed land title of 4,469 ha.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
26
Acquisitions - continued
2007
(1)
PT Cahaya Pelita Andhika
In June 2007 the group acquired a 90% interest in PT Cahaya Pelita Andhika (CPA) for a cash consideration of
$5,198,000 and settled a loan of $1,045,000 due by CPA. CPA owns a partly planted oil palm estate of 4,470 ha in
the province of North Sumatra. The assets and liabilities and their fair value adjustment were assessed as follows:
Fixed assets
Current borrowings
Other net current (liabilities)
Net assets acquired
Group share (90%)
Book value
$000
1,279
(1,045)
–
Revaluation to fair value
$000
5,542
–
–
Fair value
$000
6,821
(1,045)
–
234
5,542
5,776
5,198
The group’s share of the loss of CPA from acquisition to the end of 2007 was $276,000 which included rehabilitation
expenditure. Prior to acquisition CPA was not trading.
(2)
PT Bangka Malindo Lestari
In December 2007 the group acquired a 95% interest in PT Bangka Malindo Lestari (BML) for a cash consideration
of $1,451,000. BML had no assets or liabilities other than the right to acquire a land title over 7,000 ha on the island
of Bangka. The assets and their fair value adjustment were assessed as follows:
Fixed assets only acquired
Group share (95%)
Book value
$000
913
Revaluation to fair value
$000
614
Fair value
$000
1,527
1,451
BML was inactive throughout 2007 and therefore the group’s share of any profit or loss from the date of acquisition
to the end of 2007 was nil.
(3)
PT Sawit Graha Manunggal
In December 2007 the group acquired a 95% interest in PT Sawit Graha Manunggal (SGM) for a cash consideration
of $6,786,000. SGM had no assets or liabilities other than the right to acquire a land title over 26,000 ha in the
province of Central Kalimantan on the island of Borneo. The assets and their fair value adjustment were assessed
as follows:
Fixed assets only acquired
Group share (95%)
Book value
$000
3,771
Revaluation to fair value
$000
3,372
Fair value
$000
7,143
6,786
SGM was inactive throughout 2007 and therefore the group’s share of any profit or loss from the date of acquisition
to the end of 2007 was nil.
27
Post Balance Sheet Events
No major events or transactions occurred between the balance sheet and the date of this report.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Consolidated Financial Statements
28
Subsidiary companies
The principal subsidiaries of the company all of which have been included in these consolidated financial statements are
as follows:
Percentage holding of
ordinary shares
Principal United Kingdom sub-holding company
Anglo-Indonesian Oil Palms Limited
UK management company
Indopalm Services Limited
Malaysian operating companies
Anglo-Eastern Plantations (M) Sdn Bhd
Anglo-Eastern Plantations Management Sdn Bhd
Indonesian operating companies
PT Alno Agro Utama
PT Anak Tasik
PT Bangka Malindo Lestari
PT Bina Pitra Jaya
PT Cahaya Pelita Andhika
PT Empat Lawang Agro Perkasa
PT Hijau Pryan Perdana
PT Karya Kencana Sentosa Tiga
PT Mitra Puding Mas
PT Musam Utjing
PT Riau Agrindo Agung
PT Sawit Graha Manunggal
PT Simpang Ampat
PT Tasik Raja
PT United Kingdom Indonesia Plantations
100
100
55
100
90
100
95
80
90
95
80
95
90
75
95
95
100
80
75
The principal United Kingdom sub-holding company and UK management company are registered in England and Wales
and are direct subsidiaries of the company. Details of United Kingdom subsidiaries which are not significant have been
omitted. The Malaysian operating companies are incorporated in Malaysia and are direct subsidiaries of the company.
The Indonesian operating companies are incorporated in Indonesia and are direct subsidiaries of the principal sub-holding
company. The principal activity of the operating companies is plantation agriculture.
Anglo-Eastern Plantations Plc I Annual Report 2008
Company Balance Sheet (UK GAAP)
as at 31 December 2008
Non-current assets
Investment in subsidiaries
Current assets
Debtors
Cash and cash equivalents
Current liabilities
Other creditors
Net current assets
Net assets
Equity
Share capital
Treasury shares
Share premium reserve
Share capital redemption reserve
Exchange reserve
Retained earnings
Shareholders’ funds
Notes
2008
$000
2007
$000
2
77,948
50,276
77,948
50,276
3
690
311
1,001
43
2,062
2,105
5
(168)
(192)
833
1,913
78,781
52,189
15,504
(1,785)
23,935
1,087
3,872
36,168
15,504
(1,785)
23,935
1,087
3,872
9,576
78,781
52,189
6
6
7
7
7
7
The financial statements were approved by the board of directors and authorised for issue on 15 April 2008 and
were signed on its behalf by Donald H Low
The accompanying notes are an integral part of this balance sheet.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Company Financial Statements
1
Accounting policies
Basis of accounting
The separate financial statements of the company are presented as required by the Companies Act 1985. They have been
prepared under the historical costs convention and in accordance with applicable United Kingdom Accounting Standards
and law. The principal accounting policies are summarised below.
Foreign currency
The functional currency of the company is US dollars, chosen because the price of the bulk of the group’s products are
ultimately denominated in dollars. Transactions in sterling are translated to US dollars at the actual exchange rate and
exchange losses recognised in profit and loss. Sterling denominated assets and liabilities are converted to US dollars at
the rate ruling at the balance sheet date.
Investments
Investments in subsidiaries are stated at cost less provision for any permanent diminution in value.
Dividends
In accordance with FRS21 equity dividends are recognised when they become legally payable.
Share based payments
As set out under group accounting policies on page 27.
Deferred tax
A deferred tax asset has not been recognised in relation to brought forward tax losses of $1.6m (2007: $1.8m) because it
is not certain those losses can be utilised.
Treasury shares
Consideration paid or received for the purchase or sale of the company’s own shares for holding in treasury is recognised
directly in equity, where the cost is presented as the treasury share reserve. Any excess of the consideration received on
the sale of treasury shares over the weighted average cost of shares sold, is taken to the share premium account. Any
shares held in treasury are treated as cancelled for the purpose of calculating earnings per share.
Financial guarantee contracts
Where the company enters into financial guarantee contracts and guarantees the indebtedness of other companies within
the group, the company considers these to be insurance arrangements and accounts for them as such. In this respect, the
company treats the guarantee contract as a contingent liability until such time that it becomes probable that the company
will be required to make a payment under the guarantee.
2
Investments in subsidiaries
At beginning of year
Movements in year
At end of year
Investments in
subsidiary
Loans to
subsidiary
undertakings undertakings
$000
42,531
27,672
$000
7,745
–
7,745
70,203
Total
$000
50,276
27,672
77,948
Loans to and from subsidiary companies do not have fixed repayment terms and are repayable on demand. In practice they
are effectively long term in nature and therefore classified with investments in subsidiaries. The investment of preference
shares in subsidiaries of $6.146m is due for redemption in 2012.
The principal subsidiaries of the company are listed in note 28 to the consolidated financial statements on page 46.
3
Debtors
Prepayments and accrued income
4
Dividends
Paid during the year
Final dividend of 14.0 cts for the year ended 31 December 2007 (2006 – 10.80cts)
Proposed final dividend of 5.0 cts for the year ended 31 December 2008 (2007 – 14.0cts)
2008
$000
690
2008
$000
5,112
1,973
2007
$000
43
2007
$000
4,266
5,524
The proposed dividend for 2008 is subject to shareholder approval at the forthcoming annual general meeting and has not
been included as a liability in these financial statements.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notes to the
Company Financial Statements
2008
$000
168
–
168
2007
$000
176
16
192
Authorised
Number
Issued and
fully paid
Number
Authorised
£000
Issued and
fully paid
£000
Authorised
$000
Issued and
fully paid
$000
60,000,000
39,976,272
15,000
9,994
23,865
15,504
5
Other creditors
Accruals
Other creditors
6
Share capital
Ordinary shares of
25p each
Beginning and end
of year
Treasury shares
Beginning of year
Purchased in year
End of year
2008
Number
518,000
–
518,000
2007
Number
468,000
50,000
518,000
2008
$000
(1,785)
(1,785)
2007
$000
(1,387)
(398)
(1,785)
4,659
1,990
Market value of treasury shares
Beginning of year (447.5p/share)
End of year (272.5p/share)
The treasury shares purchased in 2007 were purchased in September at 386p.
Details of share based payments are set out in note 20 to the consolidated financial statements on page 38.
7
Reserves
Company balance sheet
Beginning of year
Profit for the financial year
Dividend paid
End of year
Share
premium
account
$000
23,935
–
–
23,935
Treasury
shares
$000
1,785
–
–
Share
capital
redemption
$000
1,087
–
–
Profit and
loss
account
(distributable)
$000
9,576
31,704
(5,112)
Exchange
reserve
$000
3,872
–
–
1,785
1,087
3,872
36,168
As permitted by section 230 of the Companies Act 1985, a separate profit and loss account dealing with the results of the
company has not been presented. The profit before tax of the company for the year was $36,254,000 (2007 - $4,318,000)
and profit for the year was $31,704,000 (2007 – $4,285,000).
8
Employees’ and directors’ remuneration
Average numbers employed during the year
- directors
- staff
Staff costs
Wages and salaries
Social security costs
Retirement benefit costs
Share based remuneration expense
2008
number
6
2
2008
$000
1,280
10
22
–
1,312
2007
number
6
2
2007
$000
968
67
57
87
1,179
The information required by the Companies Act and the listing rules of the Financial Services Authority is contained in the
directors’ report on remuneration on pages 18 to 19 of which the information on page 19 has been audited.
Directors’ emoluments
Pension contributions
2008
$000
641
22
663
2007
$000
772
39
811
9
Guarantees and other financial commitments
The company has provided guarantees for loans and overdrafts to subsidiaries totalling $35,650,000 (2007 -$42,889,000)
as set out in note 15 of the consolidated financial statements.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notice of Annual General Meeting
Notice is hereby given that the twenty-fourth Annual General Meeting of Anglo-Eastern Plantations Plc will be held
at the offices of Withers LLP, 16 Old Bailey, London EC4M 7EG on 19 June 2009 at 11.00 a.m. for the following
purposes:
As Ordinary Business
1
2
3
4
5
6
7
8
To receive and consider the company’s annual report for the year ended 31 December 2008.
To declare a dividend.
To approve the directors’ remuneration report for the year ended 31 December 2008.
To re-appoint Mr. Nik Din Nik Sulaiman, independent non-executive director.
To re-appoint Mr. Donald H Low, a director.
To re-appoint Mr. Chan Teik Huat, a director.
To re-elect Madam Lim Siew Kim, a non-executive director, who has served more than nine years.
To appoint BDO Stoy Hayward LLP as auditors and to authorise the directors to fix their remuneration.
As Special Business
9
To consider and, if thought fit, to pass the following resolution as special resolution:
That
(a)
(b)
the directors be generally and unconditionally authorised pursuant to and in accordance with section 80
of the Companies Act 1985 (“the Act”) to exercise for the period ending on 18 June 2014 all the powers
of the company to allot relevant securities up to an aggregate nominal amount equal to one-third of the
issued share capital at the date of this resolution;
during the period expiring on the date of the next Annual General Meeting or on 18 September 2010
(whichever shall be earlier) the directors be empowered to allot equity securities for cash pursuant to the
authority conferred under paragraph (a) above or by way of sale of treasury shares (within the meaning
of section 162A of the Act):
(i)
in connection with a rights issue; and
(ii)
up to an aggregate nominal amount of £499,703, otherwise than in connection with a rights
issue;
as if section 89 (1) of the Act did not apply to any such allotment;
(c)
by such authority and power the directors may during such periods make offers or agreements which
would or might require the making of allotments after the expiry of such periods; and
(d)
for the purposes of this resolution:
(i)
“rights issue” means an offer of equity securities open for acceptance for a period fixed by the
directors to holders of equity securities (other than the company) on the register on a fixed record
date in proportion to their respective holdings of such securities or in accordance with the rights
attached thereto (but subject to such exclusions or other arrangements as the directors may deem
necessary or expedient in relation to fractional entitlements or legal or practical problems under
the laws of, or the requirements of any recognised regulatory body or any stock exchange in, any
territory);
0
Anglo-Eastern Plantations Plc I Annual Report 2008
Notice of Annual General Meeting
(ii)
the nominal amount of any securities shall be taken to be, in the case of rights to subscribe for or
convert any securities into shares of the company, the nominal amount of such shares which may
be allotted pursuant to such rights; and
(iii) words and expressions defined in or for the purposes of part IV of the Act shall bear the same
meanings herein.
10
To consider and if thought fit to pass the following resolution as a special resolution:
That the directors be and they are hereby authorised
(i)
(ii)
to exercise the powers contained in the Articles of Association of the company so that, to the extent
determined by the directors, the holders of ordinary shares be permitted to elect to receive new ordinary
shares in the capital of the company, credited as fully paid, instead of all or part of any interim or final
dividend or dividends which may be declared or paid at any time or times prior to 18 June 2014; and
to capitalise the appropriate nominal amount of additional ordinary shares, falling to be allotted pursuant
to elections made as aforesaid, out of the amount standing to the credit of any reserves of the company,
to apply such sum in paying up such ordinary shares and pursuant to section 80 of the Act to allot such
ordinary shares up to a maximum nominal value of an aggregate nominal amount equal to the company’s
authorised but unissued share capital at the date of this resolution to members of the company validly
making such elections at any time or times prior to 18 June 2014 as if sub-section (1) of section 89 of
the said Act did not apply thereto and so that this authority shall be without prejudice and additional to
the authority conferred by resolution no 9.
11
To consider and if thought fit to pass the following as a special resolution:
That the company is hereby generally and unconditionally authorised to make market purchases (within the
meaning of section 163 of the Act) of ordinary shares of 25p each in the capital of the company provided
that:
(a)
the maximum number of ordinary shares hereby authorised to be purchased is 3,997,627 (representing
10% of the issued ordinary share capital);
(b)
the minimum price which may be paid for each ordinary share is 25p;
(c)
(d)
the maximum price which may be paid for each ordinary share is an amount equal to 105% of the average
of the middle market quotations for such share as derived from the Daily Official List of the London Stock
Exchange plc for the five business days immediately preceding the date of purchase; and
the authority hereby conferred shall expire on 18 September 2010 or, if earlier, at the conclusion of
the next Annual General Meeting of the company save that the company may before the expiry of this
authority make a contract of purchase which will or may be executed wholly or partly after such expiry
and may make a purchase of shares pursuant to any such contract.
By order of the board
CETC (Nominees) Limited
Company Secretary
Notes:
30 April 2009
1.
2.
A member of the company entitled to attend and vote at the meeting may appoint one or more proxies to attend, speak
and vote at a meeting. Where more than one proxy is appointed, each proxy must be appointed for different shares. You
may not appoint more than one proxy to exercise rights attached to any one share. A proxy need not be a member of the
Company. The instrument appointing a proxy must be deposited at the office of the registrars not less than forty-eight hours
before the time appointed for holding the meeting (or any adjournment thereof).
Pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, the Company has specified that only those
shareholders on the register of members of the company at 11.00 a.m. on 17 June 2009 shall be entitled to attend and vote
at the meeting in respect of the number of shares registered in their name at that time. Changes to the register of members
after 11.00 a.m. on 17 June 2009 or, if the meeting is adjourned, in the register of members at 6.00 p.m. on the day which
is two days before the day of any adjourned meeting shall be disregarded in determining the rights of any person to attend
and vote at the meeting.
Anglo-Eastern Plantations Plc I Annual Report 2008
Notice of Annual General Meeting
3.
4.
In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the appointment
submitted by the most senior holder will be accepted. Seniority is determined by the order in which the names of the
joint holders appear in the Company’s register of members in respect of the joint holding (the first-named being the most
senior).
As at 15 April 2009, the Company’s issued share capital comprised 39,976,272 Ordinary Shares of 25p each. Each share
carries one vote except 518,000 shares held as treasury shares and therefore the total number of voting rights in the
Company as at 9.00 am on 15 April 2009 is 39,458,272.
5.
In order to facilitate voting by corporate representatives at the meeting, arrangements will be put in place at the meeting so
that:
(i)
(ii)
if a corporate member has appointed the Chairman of the meeting as its corporate representative with instructions
to vote on a poll in accordance with the directions of all the other corporate representatives for that member at the
meeting, then, on a poll, those corporate representatives will give voting directions to the Chairman and the Chairman
will vote (or withhold a vote) as corporate representative in accordance with those directions; and
if more than one corporate representative for the same corporate member attends the meeting but the corporate
member has not appointed the Chairman of the meeting as its corporate representative, a designated corporate
representative will be nominated, from those corporate representatives who attend, who will vote on a poll and the
other corporate representatives will give voting directions to that designated corporate representative.
Corporate members are referred to the guidance issued by the Institute of Chartered Secretaries and Administrators on
proxies and corporate representatives – www.icsa.org.uk – for further details of this procedure. The guidance includes a
sample form of representation letter to appoint the Chairman as a corporate representative as described in 5(i) above.
The right to appoint a proxy does not apply to persons whose shares are held on their behalf by another person and who
have been nominated to receive communication from the Company in accordance with section 146 of the Companies Act
2006 (“nominated persons”). Nominated persons may have a right under an agreement with the registered shareholder who
holds shares on their behalf to be appointed (or to have someone else appointed) as a proxy. Alternatively, if nominated
persons do not have such a right, or do not wish to exercise it, they may have a right under such an agreement to given
instructions to the person holding the shares as to the exercise of voting rights.
The register of directors’ interests, showing any transactions of directors and of their families in the securities of the company,
and the service agreements of directors, will be available for inspection at the registered office during usual business hours
and for15 minutes prior to the meeting and at the meeting.
Shares held in uncertified form (i.e. CREST) may be voted through the CREST Proxy Voting Service in accordance with
procedures set out in the CREST manual.
6.
7.
8.
9.
10. You may submit your proxy electronically using The Share Portal service at www.capitashareportal.com. If not already
registered for The Share Portal, you will need your Investor Code which can be found on your share certificate.
11.
12.
If you are in any doubt as to any aspect of Resolutions 9 to 11 or as to the action you should take, you should immediately
seek your own advice from a stockbroker, solicitor, accountant or other independent financial adviser authorised under the
Financial Services and Markets Act 2000. The Board believes that these Resolutions are in the best interests of the company
and shareholders as a whole.
If you have sold or otherwise transferred all your shares in the company, please hand this document and the accompanying
form of proxy to the purchaser or transferee, or to the bank, stockbroker or other agent through whom the sale or transfer
was effected, for transmission to the purchaser or transferee. If you sell or have sold or otherwise transferred only part of
your holding of existing shares please consult the bank, stockbroker or other agent through whom the sale or transfer was
effected.
52
Anglo-Eastern Plantations Plc I Annual Report 2008
Company addresses
Malaysian Office
Secretary and Registered Office
Anglo-Eastern Plantations (M) Sdn Bhd
Anglo-Eastern Plantations Plc (Number 1884630)
7th Floor
Wisma Equity
150 Jalan Ampang
50450 Kuala Lumpur
Malaysia
Tel: +60 (3) 2162 9808
Fax: +60 (3) 2164 8922
Indonesian Office
P T United Kingdom Indonesia Plantations
Wisma HSBC
Jalan Diponegoro, Kav 11
Medan 20152
North Sumatra
Indonesia
Tel: +62 (0)61 4528683
Fax: +62 (0)61 4520029
Company advisers
(Registered in England and Wales)
CETC (Nominees) Limited
Quadrant House
Floor 6
17 Thomas More Street
Thomas More Square
London E1W 1YW
United Kingdom
Tel: +44 (0)20 7216 4600
Fax: +44 (0)20 7767 2602
Company website
www.angloeastern.co.uk
Principal Bankers
Auditors
National Westminster Bank Plc
BDO Stoy Hayward LLP
15 Bishopsgate
London EC2P 2AP
United Kingdom
55 Baker Street
London W1U 7EU
United Kingdom
The Hong Kong and Shanghai Banking
Registrars
Corporation Limited
Wisma HSBC
Jalan Diponegoro, Kav 11
Medan 20152
North Sumatra
Indonesia
PT Bank DBS Indonesia
Uniplaza Building
Capita Registrars
Northern House
Woodsome Park
Fenay Bridge
Huddersfield
West Yorkshire HD8 0LA
United Kingdom
Sponsor/Broker
Jalan Letjen MT Haryonon A-1
Charles Stanley Securities
Medan 20231
North Sumatra
Indonesia
Malayan Banking Corporation Bhd
Menara Promenade
100 Jalan Tun Razak
50050 Kuala Lumpur
Malaysia
25 Luke Street
London EC2A 4AR
United Kingdom
Solicitors
Withers LLP
16 Old Bailey
London EC4M 7EG
United Kingdom