2015 Annual Report
Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations
Contents
Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil
and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha.
About AEP
Financial Highlights
Key Information
Shareholder Information
Chairman's Statement
Strategic Report
Financial Record
Estate Areas
Location of Estates
Directors' Report
Directors' Responsibilities
Directors
Statement on Corporate Governance
Audit Committee Report
Directors' Remuneration Report
Auditors' Report
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
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Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Company Balance Sheet
Company Statement of Changes in Equity
Notes to the Company Financial Statements
Notice of Annual General Meeting
Form of Proxy and Attendance Card
AEP has a Premium Listing on the London Stock
Exchange. The Company was formed and floated in
1985.
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Primary activities are
the crop production and
processing of palm oil and some rubber through
operations in Indonesia and Malaysia.
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The Group is committed to responsible development
and management of its plantations and facilities for the
benefit of the environment and society in which it
operates.
Separate Attachment
100
Company addresses, advisers and website
Inside Back Cover
Annual Report 2015 | Anglo-Eastern Plantations Plc
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Company addresses
London Office
Anglo-Eastern Plantations Plc
Quadrant House, 6th Floor
4 Thomas More Square
London E1W 1YW
United Kingdom
Tel: 44 (0)20 7216 4621
Fax: 44 (0)20 7767 2602
Malaysian Office
Anglo-Eastern Plantations Management Sdn Bhd
7th Floor, Wisma Equity
150 Jalan Ampang
50450 Kuala Lumpur
Malaysia
Tel:
60 (0)3 2162 9808
Fax: 60 (0)3 2164 8922
Indonesian Office
PT Anglo-Eastern Plantations Management Indonesia
Wisma HSBC, Jalan Diponegoro, Kav 11
Medan 20152
North Sumatera
Indonesia
Tel: 62 (0)61 452 0107
Fax: 62 (0)61 452 0029
Secretary and registered office
Anglo-Eastern Plantations Plc
(Number 1884630)
(Registered in England and Wales)
CETC (Nominees) Limited
Quadrant House, 6th Floor
4 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
Company advisers
Auditors
BDO LLP
55 Baker Street
London W1U 7EU
United Kingdom
Principal Bankers
National Westminster Bank Plc
15 Bishopsgate
London EC2P 2AP
United Kingdom
The Hong Kong and Shanghai Banking Corporation
Limited
Wisma HSBC
Jalan Diponegoro, Kav 11
Medan 20152
North Sumatera
Indonesia
PT Bank DBS Indonesia
Uniplaza Building
Jalan Letjen MT Haryono A-1
Medan 20231
North Sumatera
Indonesia
RHB Bank Bhd
Podium Block, Plaza OSK
Jalan Ampang
50450 Kuala Lumpur
Malaysia
Registrars
Capita Registrars Ltd
Northern House
Woodsome Park
Fenay Bridge
Huddersfield
West Yorkshire HD8 0GA
United Kingdom
Solicitors
Withers LLP
16 Old Bailey
London EC4M 7EG
United Kingdom
Sponsor/Broker
Panmure Gordon (UK) Limited
One New Change
London EC4M 9AF
United Kingdom
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About Anglo-Eastern Plantations
About Anglo-Eastern Plantations
About Anglo-Eastern Plantations
About Anglo-Eastern Plantations
Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil
Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil
Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil
Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil
and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha.
and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha.
and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha.
and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha.
AEP has a Premium Listing on the London Stock
AEP has a Premium Listing on the London Stock
AEP has a Premium Listing on the London Stock
AEP has a Premium Listing on the London Stock
Exchange. The Company was formed and floated in
Exchange. The Company was formed and floated in
Exchange. The Company was formed and floated in
Exchange. The Company was formed and floated in
1985.
1985.
1985.
1985.
Primary activities are
Primary activities are
Primary activities are
Primary activities are
the crop production and
the crop production and
the crop production and
the crop production and
processing of palm oil and some rubber through
processing of palm oil and some rubber through
processing of palm oil and some rubber through
processing of palm oil and some rubber through
operations in Indonesia and Malaysia.
operations in Indonesia and Malaysia.
operations in Indonesia and Malaysia.
operations in Indonesia and Malaysia.
The Group is committed to responsible development
The Group is committed to responsible development
The Group is committed to responsible development
The Group is committed to responsible development
and management of its plantations and facilities for the
and management of its plantations and facilities for the
and management of its plantations and facilities for the
and management of its plantations and facilities for the
benefit of the environment and society in which it
benefit of the environment and society in which it
benefit of the environment and society in which it
benefit of the environment and society in which it
operates.
operates.
operates.
operates.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
About Anglo-Eastern Plantations
About Anglo-Eastern Plantations
About Anglo-Eastern Plantations
Oil Palm Plantations
Oil Palm Plantations
Oil Palm Plantations
The Group has developed 50,800ha of mature oil palm at 15 plantations across
The Group has developed 50,800ha of mature oil palm at 15 plantations across
The Group has developed 50,800ha of mature oil palm at 15 plantations across
Indonesia and Malaysia.
Indonesia and Malaysia.
Indonesia and Malaysia.
Oil Palm Development
Oil Palm Development
Oil Palm Development
An Oil Palm tree will usually take 3 years from planting to harvest of first crop and
An Oil Palm tree will usually take 3 years from planting to harvest of first crop and
An Oil Palm tree will usually take 3 years from planting to harvest of first crop and
will reach full production after 5 years. The Group has approximately 13,000ha of
will reach full production after 5 years. The Group has approximately 13,000ha of
will reach full production after 5 years. The Group has approximately 13,000ha of
recently planted immature plantations of which 3,416ha were planted in 2015,
recently planted immature plantations of which 3,416ha were planted in 2015,
recently planted immature plantations of which 3,416ha were planted in 2015,
including replanting of 1,590ha.
including replanting of 1,590ha.
including replanting of 1,590ha.
Palm Oil Production
Palm Oil Production
Palm Oil Production
The Group operates 6 palm oil mills in Indonesia, including a mill at Northern
The Group operates 6 palm oil mills in Indonesia, including a mill at Northern
The Group operates 6 palm oil mills in Indonesia, including a mill at Northern
Sumatera incorporating advanced waste management treatment for biomass
Sumatera incorporating advanced waste management treatment for biomass
Sumatera incorporating advanced waste management treatment for biomass
disposal and biogas emission capture. A second biogas plant is being
disposal and biogas emission capture. A second biogas plant is being
disposal and biogas emission capture. A second biogas plant is being
constructed at the new mill in Central Kalimantan which began commercial
constructed at the new mill in Central Kalimantan which began commercial
constructed at the new mill in Central Kalimantan which began commercial
operations in the third quarter of 2015. The 6 mills will be able to process up to a
operations in the third quarter of 2015. The 6 mills will be able to process up to a
operations in the third quarter of 2015. The 6 mills will be able to process up to a
combined 295mt of fresh fruit bunches (“FFB”) per hour.
combined 295mt of fresh fruit bunches (“FFB”) per hour.
combined 295mt of fresh fruit bunches (“FFB”) per hour.
Third Party Palm Oil Processing
Third Party Palm Oil Processing
Third Party Palm Oil Processing
During 2015 the Group purchased approximately 678,200mt of FFB from third
During 2015 the Group purchased approximately 678,200mt of FFB from third
During 2015 the Group purchased approximately 678,200mt of FFB from third
party producers for processing through our own mills. The total FFB throughput
party producers for processing through our own mills. The total FFB throughput
party producers for processing through our own mills. The total FFB throughput
at the Group’s mills in 2015 was 1.51 million mt producing 321,400mt of crude
at the Group’s mills in 2015 was 1.51 million mt producing 321,400mt of crude
at the Group’s mills in 2015 was 1.51 million mt producing 321,400mt of crude
palm oil (“CPO”).
palm oil (“CPO”).
palm oil (“CPO”).
Rubber Plantations
Rubber Plantations
Rubber Plantations
The Group has 512ha of established rubber plantations which, in 2015, produced
The Group has 512ha of established rubber plantations which, in 2015, produced
The Group has 512ha of established rubber plantations which, in 2015, produced
847mt of raw latex and rubber lumps. The size of rubber plantations will be
847mt of raw latex and rubber lumps. The size of rubber plantations will be
847mt of raw latex and rubber lumps. The size of rubber plantations will be
further reduced as the Group replaces ageing rubber trees with oil palm.
further reduced as the Group replaces ageing rubber trees with oil palm.
further reduced as the Group replaces ageing rubber trees with oil palm.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Financial Highlights
Financial Highlights
Financial Highlights
Revenue
Profit before tax
Revenue
Revenue
- before biological asset (“BA”) adjustment
Profit before tax
Profit before tax
- after biological asset adjustment
- before biological asset (“BA”) adjustment
- before biological asset (“BA”) adjustment
- after biological asset adjustment
- after biological asset adjustment
EPS before BA adjustment
EPS after BA adjustment
EPS before BA adjustment
EPS before BA adjustment
Dividend (pence)
EPS after BA adjustment
EPS after BA adjustment
Dividend (cents)
Dividend (pence)
Dividend (pence)
Dividend (cents)
Dividend (cents)
Note: * Based on exchange rate at 22 April 2016 of $1.4409/£
Note: * Based on exchange rate at 22 April 2016 of $1.4409/£
Note: * Based on exchange rate at 22 April 2016 of $1.4409/£
Anglo-Eastern Plantations Plc
Anglo-Eastern Plantations Plc
Anglo-Eastern Plantations Plc
2015
$m
2015
2015
$m
$m
196.5
196.5
196.5
45.0
(19.1)
45.0
45.0
(19.1)
(19.1)
69.39cts
(37.58)cts
69.39cts
69.39cts
1.75p
(37.58)cts
(37.58)cts
2.5*cts
1.75p
1.75p
2.5*cts
2.5*cts
2014
$m
2014
2014
$m
$m
251.3
251.3
251.3
85.0
51.2
85.0
85.0
51.2
51.2
132.26cts
77.61cts
132.26cts
132.26cts
3.0p
77.61cts
77.61cts
4.5cts
3.0p
3.0p
4.5cts
4.5cts
%
%
%
FTSE 100
Annual Report 2015 | Anglo-Eastern Plantations Plc
FTSE 100
FTSE 100
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Share Price (p)
Share Price (p)
Share Price (p)
Turnover by volume ('000)
Turnover by volume ('000)
Turnover by volume ('000)
4
4
4
4
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Profit Before Tax Before BA
Profit Before Tax Before BA
($000)
($000)
2011 2012 2013 2014 2015
2011 2012 2013 2014 2015
Asset Value Per Share
Asset Value Per Share
($, cents)
($, cents)
Financial Highlights
Financial Highlights
300,000
300,000
250,000
250,000
200,000
200,000
150,000
150,000
100,000
100,000
50,000
50,000
0
0
Revenue ($000)
Revenue ($000)
2011 2012 2013 2014 2015
2011 2012 2013 2014 2015
120,000
120,000
100,000
100,000
80,000
80,000
60,000
60,000
40,000
40,000
20,000
20,000
0
0
Basic Earnings Per Share
Basic Earnings Per Share
Before BA ($, cents)
Before BA ($, cents)
180.00
180.00
160.00
160.00
140.00
140.00
120.00
120.00
100.00
100.00
80.00
80.00
60.00
60.00
40.00
40.00
20.00
20.00
0.00
0.00
2011 2012 2013 2014 2015
2011 2012 2013 2014 2015
1,200
1,200
1,000
1,000
800
800
600
600
400
400
200
200
0
0
2011
2011
2012
2012
2013
2013
2014
2014
2015
2015
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Key Information
Key Information
Crude Palm Oil Production (mt)
Crude Palm Oil Production (mt)
350,000
350,000
300,000
300,000
250,000
250,000
200,000
200,000
150,000
150,000
100,000
100,000
50,000
50,000
-
-
2011
2011
2012
2012
2013
2013
2014
2014
2015
2015
Own FFB & Outside Purchase (mt)
Own FFB & Outside Purchase (mt)
1,000,000
1,000,000
900,000
900,000
800,000
800,000
700,000
700,000
600,000
600,000
500,000
500,000
400,000
400,000
300,000
300,000
200,000
200,000
100,000
100,000
-
-
2011
2011
2012
2012
Own FFB
Own FFB
2013
2013
2014
2014
Outside Purchase
Outside Purchase
Age of Palm Trees
Age of Palm Trees
(as at 31/12/15)
(as at 31/12/15)
12%
12%
20%
20%
28%
28%
40%
40%
(as at 31/12/14)
(as at 31/12/14)
11%
11%
25%
25%
30%
30%
34%
34%
2015
2015
Immature
Immature
Young
Young
Prime
Prime
Old
Old
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Shareholder Information
Market capitalisation
The market capitalisation of Anglo-Eastern Plantations Plc at 31 December 2015 was £210 million, the ordinary
share price at close of business on 1 April 2016 was 555 pence giving a market capitalisation of £220 million.
Website
www.angloeastern.co.uk contains various details and information on the Company and its operations, together with
all the key historical financial and regulatory information on the Company. The website is updated on a continuing
basis for all Company announcements and other relevant developments, including share price movements.
Investor relations
Investors requiring further information on the Company are invited to contact:
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
Anglo-Eastern Plantations Plc
Quadrant House, 6th Floor
4 Thomas More Square
London E1W 1YW
United Kingdom
Tel:
Fax:
44 (0) 20 7216 4621
44 (0) 20 7767 2602
Registrar
Administrative queries about holdings of AEP can be directed to the Company's registrar:
Capita Registrars Ltd
Northern House
Woodsome Park
Fenay Bridge
Huddersfield
West Yorkshire, HD8 0GA
United Kingdom
Tel:
Tel:
0871 664 0300 (UK)
44 (0) 20 8639 3399 (international)
Shareholders can view and update their account details via the Capita website, details of which can be found at
www.capitaregistrars.com.
Annual General Meeting
The 31st Annual General Meeting of the Company will be held at the offices of UHY Hacker Young LLP, Quadrant
House, 4 Thomas More Square, London E1W 1YW on 27 June 2016. Notice of the meeting is set out at the end of
this Annual Report and pages 100 to 103.
Amalgamation of accounts
Shareholders receiving multiple copies of Company mailings as a result of a number of accounts being maintained in
their name are invited to write to the Company's registrar at the above address to request that their accounts be
amalgamated.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Shareholder Information
Payment of dividends
The Group's reporting currency is US Dollar. While the dividend is declared in Pounds Sterling, shareholders can
choose to receive dividends in US Dollar. 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 Dollar.
The US Dollar equivalent dividend will be paid at the exchange rate ruling at the date of closure of the register.
Electronic communications
Capita Registrars offer AEP shareholders the opportunity to manage their shareholding through the Capita Share
Portal.
Registration is free and can be used to manage shareholdings quickly and securely. To register for this service go to
www.capitaregistrars.com/shareholder and follow the instructions.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Chairman's Statement
The Group achieved record production of fresh fruit bunches (“FFB”) in 2015. The crop production of 900,400mt, was
5% higher than the previous year (2014: 857,400mt) broadly in line with 9% increase in matured trees. The mills
similarly recorded the highest purchase of external FFB in recent years. FFB bought-in from surrounding
smallholders in 2015 was 678,200mt (2014: 626,200mt), 8% higher, as the Group offered competitive prices for the
external crops. The mills as a result processed 9% more FFB, and increased crude palm oil (“CPO”) production by
9% to 321,400mt (2014: 294,200mt).
FFB harvest in Kalimantan exceeded expectation and was higher than last year’s production by 65% as matured
trees increased from 4,650ha to 7,790ha. This made up for the lower production in other established regions in North
Sumatera, Riau and Bengkulu which were adversely affected by four months of drought caused by the El Nino
weather phenomenon. The dry spell compounded by the indiscriminate open burning by villagers to clear their land
for planting resulted in an unprecedented haze that blanketed parts of Indonesia for months. Sporadic fire from
surrounding land encroached onto our plantations resulting in damages of up to 175ha of palm oil in South Sumatera
and Kalimantan. The fire burned the ground weeds, cover crops and scorched lower fronds but most of the affected
palms will survive and recover. The quick response from our fire patrol teams equipped with proper fire-fighting gear
helped to quickly contain the spread of fire. In the aftermath of the forest fires, it was reported that the Indonesian
government investigated more than 200 companies and sanctioned 23 companies with suspension to permanent
revocation of operating licenses. I am pleased to report that the Group is not involved in open burning and that
normal rainfall has since returned.
Despite the increase in crop and CPO production, revenue and profitability suffered as CPO prices fell to a 7-year
low. The average CPO Rotterdam price in 2015 was 25% lower at $613/mt, compared to $815/mt in 2014. The
Group’s revenue was lower by 22% at $196.5 million, compared to $251.3 million achieved in 2014. For the year the
Indonesian Rupiah depreciated by 13% against the US dollar, the Group’s reporting currency, which also partly
explains the lower revenue.
The Group operating profit for 2015, before the biological asset (“BA”) adjustment was $42.7 million, 46% lower
compared to $78.8 million achieved in 2014. Earnings per share, before BA adjustment decreased to 69.39cts, from
132.26cts in 2014. The Group suffered an operating loss for 2015 at $21.4 million after a downward BA adjustment
of $64.1 million as compared to 2014 operating profit of $45.1 million after a downward BA adjustment of $33.7
million. Profit was eroded by losses from five newly matured plantations in Bengkulu, Bangka and Kalimantan. With
the current low CPO prices, it will take another three to four years for these plantations to turn in a profit when the
FFB yield reaches its optimum level.
At a recent 2015 Indonesian Palm Oil Conference in Bali, vegetable oil analysts forecast that CPO will trade between
a moderate price band of $550/mt to $770/mt by middle of 2016. We have seen a pick-up in CPO price in December
2015 to close at $560/mt on concern of lower production arising from the effect of El Nino. Despite this, challenging
times are ahead for the Group and the palm oil industry. Earlier this year, the Indian government in its effort to
reduce the import of vegetable oil had permitted 100% foreign direct investment in oil palm plantations in India from
mid-November 2015. This caused some flutter in the global edible oils industry which is understandable as India is
currently the largest consumer of CPO. The slowdown in the Chinese economy and weaker Chinese Yuan continue
to hurt the export of CPO. There are however signs that the world’s second largest economy and second largest
consumer of CPO is stabilizing and clarity on the timing of US interest rate hikes are bolstering speculation that
commodities will rebound from the worst year since 2008. China’s recent move from a one-child to two-child policy
may also bode well for the future of CPO as increased population will drive the demand for vegetable oil.
The over production of crude oil remains a major concern as crude oil prices had plunged to recent twelve year low
which undermines the competitiveness of CPO as a source of biodiesel.
In spite of the challenging market conditions the Board has continued to invest in the development of new assets.
The Group planted 3,416ha of oil palms in 2015 of which 1,590ha comprised of replanting. This was less than
planned, due primarily to delays in finalising agreements with villagers for land compensation payments in Bengkulu,
Bangka and Kalimantan.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Chairman's Statement
The 45mt/hr mill in Central Kalimantan built at a cost of $11.2 million has started commercial operation in the third
quarter of 2015. At the same time a biogas plant estimated to cost $2.5 million is also being constructed at this mill.
Upon completion of the biogas plant by the middle of 2016, it will help reduce the mill reliance on fossil fuel and at
the same time reduces the Group’s carbon foot print. This will be the second biogas plant within the Group.
The Board is mindful that given the anticipated further capital commitments the level of dividend needs to be
balanced against the planned expenditure. The Board is also mindful of shareholders’ sentiment and therefore
declared a final dividend of 1.75p per share in respect of the year to 31 December 2015 (2014: 3.0p). Subject to the
approval by shareholders at the Annual General Meeting, the final dividend will be paid on 11 July 2016 to those
shareholders on the register on 10 June 2016.
Last year I highlighted the introduction of the new Law on Plantation by the Indonesian Government in October 2014.
The new law inter-alia mandated the Government to prioritise domestic investments in the plantation business
development and restricts foreign investments in the same sector based on types of plantation crops, business scale
and conditions of a particular region; and possibly in the future, may set a cap on foreign investments.
Following the introduction of the new Law on Plantation by the Indonesian Government in October 2014, the
Indonesian Government has recently announced plans to push through a moratorium on new concessions for oil
palm plantations in a bid to protect the environment.
On behalf of the Board of Directors, I would like to convey our sincere thanks to our management and all employees
of the Group for their dedication, loyalty, resourcefulness, commitment and contribution to the success of the Group.
I would also like to take this opportunity to thank shareholders, business associates, government authorities and all
other stakeholders for their continued confidence, understanding and support for the Group.
Madam Lim Siew Kim
Chairman
26 April 2016
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Business Model
The Group will continue to focus on its strength and expertise which is planting more oil palms which includes
replanting old palms with low yield, replace old rubber trees with palm trees and building more mills to process the
FFB. The Group has over the years created value to shareholders through expansion in a responsible way. We have
in the last few years bought and invested in new tracts of land and portions remain to be planted. Good land at
reasonable price has become more scarce. The Indonesian government has in 2014 moved to introduce a law to
cap the size of new plantations owned by foreign companies. The Group remains committed to use its available
resources to develop the land bank in Indonesia as regulatory constraints permit.
The Group’s objectives are to provide appropriate returns to investors in the long term from operation as well as
expansion of the Group’s business, to foster economic progress in the localities of the Group’s activities and to
develop the Group’s operations in accordance with the best corporate social responsibility and sustainability
standards.
We believe that sustainable success for the Group is best achieved by acting in the long-term interests of our
shareholders, our partners and society.
Our Strategy
The Group’s objectives are to provide an appropriate level of returns to the investors and to enhance shareholders’
value. Profitability however is very much dependent on the CPO price which is volatile and determined by supply and
demand. In the short term, CPO price remains under pressure due to the abundance of vegetable oil and the falling
crude oil prices which undermine the potential of CPO as a source for biodiesel. Nevertheless the Group believes in
the long-term viability of palm oil which remains a cheap and the most productive source of vegetable oil in a growing
population.
The Group’s strategies therefore focus on maximising yield per hectare above 22mt/ha, mill production efficiency of
110%, minimising production costs below $300/mt and streamlining estate management. For the year under review,
the Group achieved a yield of 18.4mt/ha, 109% mill efficiency and production cost of $250/mt on Indonesia
operations. This compared to 2014 yield of 19.1mt/ha, 115% mill efficiency and production cost of $255/mt. Despite
stiff competition for external crops from surrounding millers, the Group is committed to purchase more external crops
from third parties at competitive, yet fair prices, to maximise the production efficiency of the mills. With higher
throughput, the mills achieved economy of scales in production. A mill achieves 100% mill efficiency when it
operates 16 hours a day for 300 days per annum.
In line with the commitment to reduce its carbon foot prints, the Group plans to construct in stages biogas plants at
all its mills to trap the methane gas to generate electrical power and at the same time reduces the consumption of
fossil fuel. It plans to reduce the greenhouse gas emissions per metric ton of CPO produced in the next two to three
years.
The Group will continue to follow-up and offer competitive and fair compensation to villagers so that land can be
cleared and planted.
Financial Review
The financial statements have been prepared in accordance with International Financial Reporting Standards and its
interpretations (IFRS and IFRIC interpretations) issued by the International Accounting Standards Board (“IASB”) as
adopted by the European Union (“EU”) and with those parts of the Companies Act 2006 applicable to companies
preparing their accounts under IFRS.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
For the year ended 31 December 2015, revenue for the Group was $196.5 million, 22% lower than $251.3 million
reported in 2014 due primarily to the lower CPO price and the weakened of Rupiah against US Dollar. CPO price hit
a 7-year low as palm oil inventory reaches new all-time high. The average exchange rate of Rupiah against US
Dollar in 2015 was 13,392, 13% lower than 2014 of 11,861.
Group operating profit for 2015 before biological asset adjustment was $42.7 million, 46% less than $78.8 million in
2014. With the current low CPO prices, fives subsidiaries with substantial newly matured oil palms incurred losses
and are expected to breakeven in about three to four years when the FFB yield reaches the optimum production
level.
FFB production for 2015 was 900,400mt, 5% higher than the 857,400mt produced in 2014. The yield remains below
expectation due to wide spread flooding in North Sumatera at the beginning of the year, followed by 4 months of
extreme dry weather between the third and fourth quarters of the year across Indonesia and Malaysia and a higher
proportion of young palms. FFB bought-in from local smallholders for 2015 was 678,200mt (2014: 626,200mt), 8%
higher compared to 2014. The supply of third party crops was lower in the third and fourth quarters of 2015 due to
dry weather. The drought induced tree stress resulted in late ripening of the fruits. During the year, FFB processed
by the Group’s mills was 1.51 million mt, 9% higher than last year of 1.38 million mt and CPO production was 9%
higher at 321,400mt, compared to 294,200mt in 2014.
Loss before tax and after BA adjustment for the Group was $19.1 million, 137% lower compared to a profit of $51.2
million in 2014. The BA adjustment was a debit of $64.1 million, compared to a debit of $33.7 million in 2014. The
CPO price for 2015 remained weak. It ended the year at $560/mt far lower than the 10-year average CPO price at
$750/mt, which is normally used in the calculation of BA. Therefore a benchmarking exercise was made to ensure
the directors’ best estimate of the price sustainable over the longer term is being used. The directors adopted the
recommendation of the valuer who has suggested applying a ratio of 70% of the current CPO price and 30% of the
historical price (10-year average) given the assumption to calculate CPO price over the past 10 years is no longer
considered to be appropriate. As a result, the directors adopted the CPO price of $625/mt which falls within the
valuer’s recommended range of $600/mt to $650/mt and the World Bank forecast of CPO price for 2016 at $600/mt.
The lower biological value was due to the weakening of Rupiah against US Dollar and also was due to a higher
discount rate applied in the determination of biological assets from 16.4% to 16.8%. The higher discount rate is a
reflection of the increased sovereign risks in Indonesia. However, this is the last year bearer plants will be fair valued
given the change to the IAS 41 which is effective on 1 January 2016.
The average CPO price for 2015 was $613/mt, 25% lower than 2014 of $815/mt.
Due to the material fluctuation of Rupiah and Malaysia Ringgit against US Dollar, a simulation was conducted on the
2014 income statement’s major items by applying year 2015 average rate onto these major items. The simulation
enabled comparison on a like for like basis eliminating the exchange element. The result is exhibited in the table
below:
Revenue
Cost of sales
Gross profit
BA adjustment
Operating profit before BA adjustment
Loss before tax after BA adjustment
2015
$000
196,451
2014
$000
222,322
Difference
$000
(25,871)
(145,897)
(145,697)
50,554
(64,121)
42,728
(19,074)
76,625
(29,759)
69,663
45,443
(200)
(26,071)
(34,362)
(26,935)
(64,517)
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
With the elimination of the exchange element, the revenue for 2015 was lower as a result of the lower CPO price.
Despite the increase in production tonnage, the cost of sales for 2015 only increased marginally. The difference of
BA adjustment between 2015 and 2014 was greater after the elimination of exchange element.
Earnings per share before BA adjustment decreased by 48% to 69.39cts compared to 132.26cts in 2014. Earnings
per share after BA adjustment fell from 77.61cts to (37.58)cts.
Going Concern
The Group’s balance sheet remains strong notwithstanding an unrealised exchange loss on translation of foreign
subsidiaries of $54.6 million compensated by a land revaluation gain of $3.7 million net of deferred tax. As at 31
December 2015, the Group had cash and cash equivalents of $104.6 million and borrowings of $34.6 million, giving
it a net cash position of $70.0 million, compared to $91.0 million in 2014. Net Group’s borrowings in the year reduced
to $34.6 million (2014: $34.9 million). For these reasons, the Group adopts a going concern basis of accounting and
believe the Group will continue operation and meet its liabilities for the foreseeable future.
Business Review
Indonesia
FFB production in North Sumatera, which aggregates the estates of Tasik, Anak Tasik, Labuhan Bilik, Blankahan,
Rambung, Sg Musam and Cahaya Pelita (“CPA”), produced 325,200mt in 2015 (2014: 342,900mt), 5% lower than
2014. In January 2015, CPA experienced heavy rainfall that inundated over 2,000ha of the plantation. The
evacuation of FFB was not possible until the flood receded. A larger budget will be allocated to build canals and
water gates as part of its flood mitigation program at CPA. In October 2015, strong wind in Rambung estate
damaged nearly 6,500 matured rubber trees covering an area of 13ha. The area affected will be replanted with oil
palms. Dry weather for a period of four months in between the third and fourth quarters of 2015 interrupted the
ripening of FFB in Tasik, Anak Tasik and Labuhan Bilik. Over 1,400ha of ageing oil palm was replanted in Tasik in
2015. Replanting was necessary due to declining yield as workers find it difficult to harvest the palm trees which
were about 30 years old as they have reached an average height of 16 to 18 metres tall.
Ganoderma fungus and Upper Stem Rot which attacks the productive palms in Anak Tasik, Blankahan and
Rambung remains a threat. Water management, good sanitation and high standards of agronomic practices remain
the main priority to avoid spreading of the diseases. This includes proper disposal of severely diseased palms after
detection. Soil mounding on infected palms was carried out to lengthen the economic life span of oil palms.
Replanting is scheduled in 2016 at Anak Tasik due to significant decline in yield attributed to Ganoderma attack.
There was no serious insect damage by Oryctes beetle, other leaf eating pests, wild animals and rats.
FFB production in Bengkulu and South Sumatera, which aggregates the estates of Puding Mas, Alno, KKST, ELAP
and RAA produced 317,400mt (2014: 304,200mt), 4% higher than 2014. With the dry weather in Bengkulu, about
165km of roads were resurfaced with gravel and laterite soil while another 550km of roads were graded and
compacted to improve transport of FFB. As most of the estates are situated close to forest reserves, wild boars and
herds of elephants continued to damage palm trees. Deep trenches and fencing provide temporary relief. The
protracted negotiation with the villagers over land compensation will have an effect on the future planting in Bengkulu
and South Sumatera. CPO production in Alno increased significantly by 27% due to higher purchase of FFB from
smallholders and marginally higher own crop production.
FFB production in the Riau region, comprising Bina Pitri estates, produced 122,500mt in 2015 (2014: 116,700mt),
5% higher than 2014. This was achieved despite the region experiencing severe drought and haze resulting from
indiscriminate open burning by farmers from July to September 2015 when rainfall averaged below 100mm per
month. CPO production improved by 10% due to the higher purchase of FFB from smallholders, despite the
competitiveness for external crops from millers. Our mill offered higher prices for external crops raising the mill
utilization rate at the expense of a lower operating margin.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
FFB production in Kalimantan which comprises of the Sawit Graha Manunggal estates produced 108,100mt in 2015
FFB production in Kalimantan which comprises of the Sawit Graha Manunggal estates produced 108,100mt in 2015
(2014: 65,700mt) mainly from newly matured oil palm area of 7,792ha. FFB yield has surpassed expectation, despite
(2014: 65,700mt) mainly from newly matured oil palm area of 7,792ha. FFB yield has surpassed expectation, despite
the sandy soil condition. FFB yield from young trees averaged 14mt/ha. As in other regions in Indonesia, the low
the sandy soil condition. FFB yield from young trees averaged 14mt/ha. As in other regions in Indonesia, the low
rainfall over a four month period of 2015 is likely to affect the FFB production in 2016. A comprehensive soil and
rainfall over a four month period of 2015 is likely to affect the FFB production in 2016. A comprehensive soil and
water conservation management including applying empty fruit bunch (“EFB”) mulching, fronds cut placement,
water conservation management including applying empty fruit bunch (“EFB”) mulching, fronds cut placement,
proper drain maintenance have been conducted in sandy soil to minimise early decline in palm trees population due
proper drain maintenance have been conducted in sandy soil to minimise early decline in palm trees population due
to soil erosion.
to soil erosion.
Overall bought-in crops for Indonesian operations were 8% higher at 678,200mt for the year 2015 (2014:
Overall bought-in crops for Indonesian operations were 8% higher at 678,200mt for the year 2015 (2014:
626,200mt). The average oil extraction rate from our mills was 21.2% in 2015 (2014: 21.3%).
626,200mt). The average oil extraction rate from our mills was 21.2% in 2015 (2014: 21.3%).
Malaysia
Malaysia
FFB production in 2015 was 3% lower at 27,200mt, compared to 28,000mt in 2014. The Malaysian operations faced
FFB production in 2015 was 3% lower at 27,200mt, compared to 28,000mt in 2014. The Malaysian operations faced
severe shortage in workers due to difficulty in recruiting foreign workers hampering harvesting and estate work. New
severe shortage in workers due to difficulty in recruiting foreign workers hampering harvesting and estate work. New
incentives and increase in monthly wages were also not sufficient to retain workers after their initial two-year contract
incentives and increase in monthly wages were also not sufficient to retain workers after their initial two-year contract
expired. In 2015, the Malaysian plantations had $0.7 million pre-tax profit after BA adjustment compared to a pre-tax
expired. In 2015, the Malaysian plantations had $0.7 million pre-tax profit after BA adjustment compared to a pre-tax
loss of $0.9 million in 2014.
loss of $0.9 million in 2014.
Commodity Prices
Commodity Prices
The CPO CIF Rotterdam price started the year at $700/mt (2014: $890/mt) and reached a peak of $707/mt in March
The CPO CIF Rotterdam price started the year at $700/mt (2014: $890/mt) and reached a peak of $707/mt in March
2015 before retreating to a 7-year low in August 2015. It staged a slight recovery due to larger imports after price
2015 before retreating to a 7-year low in August 2015. It staged a slight recovery due to larger imports after price
drop to record low and on concern of lower production in 2016. It ended the year at $560/mt (2014: $700/mt),
drop to record low and on concern of lower production in 2016. It ended the year at $560/mt (2014: $700/mt),
averaging $613/mt for the year (2014: $815/mt).
averaging $613/mt for the year (2014: $815/mt).
CPO CIF Rotterdam (from year 2005 to 2016)
CPO CIF Rotterdam (from year 2005 to 2016)
CPO CIF Rotterdam
CPO CIF Rotterdam
U$/mt
U$/mt
1600
1600
1400
1400
1200
1200
1000
1000
800
800
600
600
400
400
200
200
0
0
3/1/2005
3/1/2005
3/8/2006
3/8/2006
3/3/2008
3/3/2008
3/10/2009
3/10/2009
3/5/2011
3/5/2011
3/12/2012
3/12/2012
3/7/2014
3/7/2014
3/2/2016
3/2/2016
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
The soft demand for palm oil due to the abundance of soya oil is likely to curb a quick recovery of the CPO price.
The soft demand for palm oil due to the abundance of soya oil is likely to curb a quick recovery of the CPO price.
The depressed crude oil prices for much of 2015 did not help to boost the competitiveness of CPO as a source of
The depressed crude oil prices for much of 2015 did not help to boost the competitiveness of CPO as a source of
biodiesel. It is widely reported that the El Nino weather phenomenon which brought severe drought across Indonesia
biodiesel. It is widely reported that the El Nino weather phenomenon which brought severe drought across Indonesia
and Malaysia for four months in 2015 is likely to cause moisture stress in palm trees. Furthermore, the region was
and Malaysia for four months in 2015 is likely to cause moisture stress in palm trees. Furthermore, the region was
blanketed by haze reducing the sunlight required for photosynthesis process in palms and will likely result in reduced
blanketed by haze reducing the sunlight required for photosynthesis process in palms and will likely result in reduced
crop production in 2016. A lower production will most likely lead to a gradual increase in CPO price. The successful
crop production in 2016. A lower production will most likely lead to a gradual increase in CPO price. The successful
efforts of Indonesia and Malaysia to introduce higher mandatory blending of biodiesel for industrial and commercial
efforts of Indonesia and Malaysia to introduce higher mandatory blending of biodiesel for industrial and commercial
purposes likewise could provide some price support.
purposes likewise could provide some price support.
Rubber prices averaged $1,269/mt for 2015 (2014: $1,616/mt). Our small area of 502ha of mature rubber contributed
Rubber prices averaged $1,269/mt for 2015 (2014: $1,616/mt). Our small area of 502ha of mature rubber contributed
a revenue of $1.1 million in 2015 (2014: $1.8 million).
a revenue of $1.1 million in 2015 (2014: $1.8 million).
Corporate Development
Corporate Development
In 2015, the Group opened up new land and planted 1,826ha of oil palm mainly in Kalimantan, boosting planted area
In 2015, the Group opened up new land and planted 1,826ha of oil palm mainly in Kalimantan, boosting planted area
including Plasma by 3% to 65,100ha (2014: 63,500ha). This excludes the replanting of 1,423ha of oil palm in North
including Plasma by 3% to 65,100ha (2014: 63,500ha). This excludes the replanting of 1,423ha of oil palm in North
Sumatera. Another 166ha of ageing rubber trees were replanted with oil palm. New plantings remain behind
Sumatera. Another 166ha of ageing rubber trees were replanted with oil palm. New plantings remain behind
schedule due to delays in finalising settlement of land compensation with villagers in Bengkulu, Bangka and
schedule due to delays in finalising settlement of land compensation with villagers in Bengkulu, Bangka and
Kalimantan. The villagers seek compensation beyond what the Group considered fair and reasonable resulting in
Kalimantan. The villagers seek compensation beyond what the Group considered fair and reasonable resulting in
protracted negotiations. The progress of new planting in Kalimantan was interrupted by prolonged dry weather during
protracted negotiations. The progress of new planting in Kalimantan was interrupted by prolonged dry weather during
a four month period.
a four month period.
The mill construction in Central Kalimantan was completed in the second quarter of 2015. It began commercial
The mill construction in Central Kalimantan was completed in the second quarter of 2015. It began commercial
operation in the third quarter with an initial capacity to process FFB at a rate of 45mt/hr. There is sufficient space to
operation in the third quarter with an initial capacity to process FFB at a rate of 45mt/hr. There is sufficient space to
add a new processing line in the mill to expand the processing capacity to 90mt/hr when the need arises.
add a new processing line in the mill to expand the processing capacity to 90mt/hr when the need arises.
Biogas Purification Plant
Biogas Purification Plant
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Strategic Report
Biomass plant producing dried long fibre
Biomass plant producing dried long fibre
Biomass plant producing dried long fibre
Negotiation to sell the surplus power estimated at 5.75 million kwh per year to the Indonesian National Electricity
Negotiation to sell the surplus power estimated at 5.75 million kwh per year to the Indonesian National Electricity
Negotiation to sell the surplus power estimated at 5.75 million kwh per year to the Indonesian National Electricity
Company from its new biogas plant in North Sumatera is pending approval from authority after completion of a
Company from its new biogas plant in North Sumatera is pending approval from authority after completion of a
Company from its new biogas plant in North Sumatera is pending approval from authority after completion of a
feasibility study. Upon approval, the Company will install electric cables, transformer and switchgears estimated to
feasibility study. Upon approval, the Company will install electric cables, transformer and switchgears estimated to
feasibility study. Upon approval, the Company will install electric cables, transformer and switchgears estimated to
cost $300,000 to link the biogas plant to the national grid.
cost $300,000 to link the biogas plant to the national grid.
cost $300,000 to link the biogas plant to the national grid.
The Group has started construction of a second biogas plant in Kalimantan which is expected to be completed by
The Group has started construction of a second biogas plant in Kalimantan which is expected to be completed by
The Group has started construction of a second biogas plant in Kalimantan which is expected to be completed by
end of next year. This project would contribute to the Group’s reduction of carbon footprint.
end of next year. This project would contribute to the Group’s reduction of carbon footprint.
end of next year. This project would contribute to the Group’s reduction of carbon footprint.
Corporate Social Responsibility
Corporate Social Responsibility
Corporate Social Responsibility
Corporate Social Responsibility (“CSR”) is an integral part of corporate self-regulation incorporated into our business
Corporate Social Responsibility (“CSR”) is an integral part of corporate self-regulation incorporated into our business
Corporate Social Responsibility (“CSR”) is an integral part of corporate self-regulation incorporated into our business
model. Our Group embraces responsibility for the impact of its activities on the environment, consumers, employees,
model. Our Group embraces responsibility for the impact of its activities on the environment, consumers, employees,
model. Our Group embraces responsibility for the impact of its activities on the environment, consumers, employees,
communities, stakeholders and all other members of the public sphere. In engaging the social dimension of CSR, the
communities, stakeholders and all other members of the public sphere. In engaging the social dimension of CSR, the
communities, stakeholders and all other members of the public sphere. In engaging the social dimension of CSR, the
Group’s business has taken cognizance of the contribution and further enrichment of its employees while continuing
Group’s business has taken cognizance of the contribution and further enrichment of its employees while continuing
Group’s business has taken cognizance of the contribution and further enrichment of its employees while continuing
to make contributions to improve the well-being of the surrounding community.
to make contributions to improve the well-being of the surrounding community.
to make contributions to improve the well-being of the surrounding community.
The majority of employees and their dependents in the plantations and mills are housed in self-contained
The majority of employees and their dependents in the plantations and mills are housed in self-contained
The majority of employees and their dependents in the plantations and mills are housed in self-contained
communities built by the Group. The employees and their dependents are provided with free housing, clean water
communities built by the Group. The employees and their dependents are provided with free housing, clean water
communities built by the Group. The employees and their dependents are provided with free housing, clean water
and electricity. The Group also builds, provides and repairs places of worship for workers of different religious faiths
and electricity. The Group also builds, provides and repairs places of worship for workers of different religious faiths
and electricity. The Group also builds, provides and repairs places of worship for workers of different religious faiths
as well as schools and sports facilities in these communities. Over the years, the Group has built a total of 71
as well as schools and sports facilities in these communities. Over the years, the Group has built a total of 71
as well as schools and sports facilities in these communities. Over the years, the Group has built a total of 71
mosques and 16 churches in all its estates. In 2015, the Group spent $399,500 to build additional facilities and to
mosques and 16 churches in all its estates. In 2015, the Group spent $399,500 to build additional facilities and to
mosques and 16 churches in all its estates. In 2015, the Group spent $399,500 to build additional facilities and to
maintain these amenities. This includes construction of a new classroom in a school in Bengkulu while a new
maintain these amenities. This includes construction of a new classroom in a school in Bengkulu while a new
maintain these amenities. This includes construction of a new classroom in a school in Bengkulu while a new
elementary school in Labuhan Bilik was built and handed over to the local government.
elementary school in Labuhan Bilik was built and handed over to the local government.
elementary school in Labuhan Bilik was built and handed over to the local government.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Strategic Report
Strategic Report
School bus for employees’ children
School bus for employees’ children
School bus for employees’ children
School bus for employees’ children
Fun game on employees’ Family Day
Fun game on employees’ Family Day
Fun game on employees’ Family Day
Fun game on employees’ Family Day
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Strategic Report
Strategic Report
Staff and selected employees are given the opportunity to be trained and to attend seminars to enhance their
Staff and selected employees are given the opportunity to be trained and to attend seminars to enhance their
Staff and selected employees are given the opportunity to be trained and to attend seminars to enhance their
Staff and selected employees are given the opportunity to be trained and to attend seminars to enhance their
working skills and capability. In 2015 the Group’s Head Agronomist completed his PhD in Soil Science with summa
working skills and capability. In 2015 the Group’s Head Agronomist completed his PhD in Soil Science with summa
working skills and capability. In 2015 the Group’s Head Agronomist completed his PhD in Soil Science with summa
working skills and capability. In 2015 the Group’s Head Agronomist completed his PhD in Soil Science with summa
cum laude from the University of North Sumatera. The Group provides free education for all employees’ children in
cum laude from the University of North Sumatera. The Group provides free education for all employees’ children in
cum laude from the University of North Sumatera. The Group provides free education for all employees’ children in
cum laude from the University of North Sumatera. The Group provides free education for all employees’ children in
the local plantations and communities where they work. In 2015, scholarships amounting to $32,300 were provided
the local plantations and communities where they work. In 2015, scholarships amounting to $32,300 were provided
the local plantations and communities where they work. In 2015, scholarships amounting to $32,300 were provided
the local plantations and communities where they work. In 2015, scholarships amounting to $32,300 were provided
to children in surrounding villages and selected employees’ children to further their tertiary education in collaboration
to children in surrounding villages and selected employees’ children to further their tertiary education in collaboration
to children in surrounding villages and selected employees’ children to further their tertiary education in collaboration
to children in surrounding villages and selected employees’ children to further their tertiary education in collaboration
with universities in Riau and Bengkulu. In total 95 scholarships were given out. Selected under graduates were given
with universities in Riau and Bengkulu. In total 95 scholarships were given out. Selected under graduates were given
with universities in Riau and Bengkulu. In total 95 scholarships were given out. Selected under graduates were given
with universities in Riau and Bengkulu. In total 95 scholarships were given out. Selected under graduates were given
opportunities for industrial training during semester breaks. In addition the Group provides funding to construct
opportunities for industrial training during semester breaks. In addition the Group provides funding to construct
opportunities for industrial training during semester breaks. In addition the Group provides funding to construct
opportunities for industrial training during semester breaks. In addition the Group provides funding to construct
educational facilities including laboratories, libraries, and computers. The salaries of teachers in the estates and the
educational facilities including laboratories, libraries, and computers. The salaries of teachers in the estates and the
educational facilities including laboratories, libraries, and computers. The salaries of teachers in the estates and the
educational facilities including laboratories, libraries, and computers. The salaries of teachers in the estates and the
cost of school buses to transport employees’ children to the schools are provided by the Group. Over the years a
cost of school buses to transport employees’ children to the schools are provided by the Group. Over the years a
cost of school buses to transport employees’ children to the schools are provided by the Group. Over the years a
cost of school buses to transport employees’ children to the schools are provided by the Group. Over the years a
total of 34 schools have been built with 121 teachers currently employed within our Group estates. In 2015, the
total of 34 schools have been built with 121 teachers currently employed within our Group estates. In 2015, the
total of 34 schools have been built with 121 teachers currently employed within our Group estates. In 2015, the
total of 34 schools have been built with 121 teachers currently employed within our Group estates. In 2015, the
Group spent some $552,500 on running the schools. The Group bought a new school bus in Kalimantan taking the
Group spent some $552,500 on running the schools. The Group bought a new school bus in Kalimantan taking the
Group spent some $552,500 on running the schools. The Group bought a new school bus in Kalimantan taking the
Group spent some $552,500 on running the schools. The Group bought a new school bus in Kalimantan taking the
tally of school buses operated by the Group in 2015 to 32 vehicles.
tally of school buses operated by the Group in 2015 to 32 vehicles.
tally of school buses operated by the Group in 2015 to 32 vehicles.
tally of school buses operated by the Group in 2015 to 32 vehicles.
The Group continues to provide free comprehensive health care for all its workers as we believe that every employee
The Group continues to provide free comprehensive health care for all its workers as we believe that every employee
The Group continues to provide free comprehensive health care for all its workers as we believe that every employee
The Group continues to provide free comprehensive health care for all its workers as we believe that every employee
and their dependents should have easy access to health services. We have established 22 clinics operated by
and their dependents should have easy access to health services. We have established 22 clinics operated by
and their dependents should have easy access to health services. We have established 22 clinics operated by
and their dependents should have easy access to health services. We have established 22 clinics operated by
qualified doctors, nurses and hospital assistants in the estates. In addition, the Group organised fogging to prevent
qualified doctors, nurses and hospital assistants in the estates. In addition, the Group organised fogging to prevent
qualified doctors, nurses and hospital assistants in the estates. In addition, the Group organised fogging to prevent
qualified doctors, nurses and hospital assistants in the estates. In addition, the Group organised fogging to prevent
spread of dengue mosquitoes. In isolated locations, the Group drill tube wells to provide clean water. Related
spread of dengue mosquitoes. In isolated locations, the Group drill tube wells to provide clean water. Related
spread of dengue mosquitoes. In isolated locations, the Group drill tube wells to provide clean water. Related
spread of dengue mosquitoes. In isolated locations, the Group drill tube wells to provide clean water. Related
healthcare expenses for 2015 were $550,800.
healthcare expenses for 2015 were $550,800.
healthcare expenses for 2015 were $550,800.
healthcare expenses for 2015 were $550,800.
A strong commitment to CSR has a positive impact on employees’ attitudes and boosts employee recruitment. The
A strong commitment to CSR has a positive impact on employees’ attitudes and boosts employee recruitment. The
A strong commitment to CSR has a positive impact on employees’ attitudes and boosts employee recruitment. The
A strong commitment to CSR has a positive impact on employees’ attitudes and boosts employee recruitment. The
Group realizes that employees are valuable assets in order to run an efficient, effective, profitable and sustainable
Group realizes that employees are valuable assets in order to run an efficient, effective, profitable and sustainable
Group realizes that employees are valuable assets in order to run an efficient, effective, profitable and sustainable
Group realizes that employees are valuable assets in order to run an efficient, effective, profitable and sustainable
business and operations.
business and operations.
business and operations.
business and operations.
The Group also recognises its obligations to the wider farming communities in which it operates. The Indonesian
The Group also recognises its obligations to the wider farming communities in which it operates. The Indonesian
The Group also recognises its obligations to the wider farming communities in which it operates. The Indonesian
The Group also recognises its obligations to the wider farming communities in which it operates. The Indonesian
authorities have established that not less than 20% of the new planted areas acquired from 2007 onwards are to be
authorities have established that not less than 20% of the new planted areas acquired from 2007 onwards are to be
authorities have established that not less than 20% of the new planted areas acquired from 2007 onwards are to be
authorities have established that not less than 20% of the new planted areas acquired from 2007 onwards are to be
reserved for the benefit of smallholder cooperative scheme, known as Plasma, and the Group is integrating such
reserved for the benefit of smallholder cooperative scheme, known as Plasma, and the Group is integrating such
reserved for the benefit of smallholder cooperative scheme, known as Plasma, and the Group is integrating such
reserved for the benefit of smallholder cooperative scheme, known as Plasma, and the Group is integrating such
smallholder developments alongside its estates. In order to aid the development of Plasma scheme, a subsidiary
smallholder developments alongside its estates. In order to aid the development of Plasma scheme, a subsidiary
smallholder developments alongside its estates. In order to aid the development of Plasma scheme, a subsidiary
smallholder developments alongside its estates. In order to aid the development of Plasma scheme, a subsidiary
provided a corporate guarantee to a local bank in excess of $16 million to cover loans raised by the cooperative. The
provided a corporate guarantee to a local bank in excess of $16 million to cover loans raised by the cooperative. The
provided a corporate guarantee to a local bank in excess of $16 million to cover loans raised by the cooperative. The
provided a corporate guarantee to a local bank in excess of $16 million to cover loans raised by the cooperative. The
plasma development has commenced in stages for its estates in Sumatera and Kalimantan.
plasma development has commenced in stages for its estates in Sumatera and Kalimantan.
plasma development has commenced in stages for its estates in Sumatera and Kalimantan.
plasma development has commenced in stages for its estates in Sumatera and Kalimantan.
The Board supported Kas Desa smallholder village development programme to supplement the livelihood of the
The Board supported Kas Desa smallholder village development programme to supplement the livelihood of the
The Board supported Kas Desa smallholder village development programme to supplement the livelihood of the
The Board supported Kas Desa smallholder village development programme to supplement the livelihood of the
villages. The Group has to-date financed, developed and managed 22 smallholder village schemes across four
villages. The Group has to-date financed, developed and managed 22 smallholder village schemes across four
villages. The Group has to-date financed, developed and managed 22 smallholder village schemes across four
villages. The Group has to-date financed, developed and managed 22 smallholder village schemes across four
companies.
companies.
companies.
companies.
In addition to education and healthcare which includes the construction of schools, provision of scholarships, books,
In addition to education and healthcare which includes the construction of schools, provision of scholarships, books,
In addition to education and healthcare which includes the construction of schools, provision of scholarships, books,
In addition to education and healthcare which includes the construction of schools, provision of scholarships, books,
the Group also develops infrastructure such as construction and repair of 3 bridges and maintain 680km of external
the Group also develops infrastructure such as construction and repair of 3 bridges and maintain 680km of external
the Group also develops infrastructure such as construction and repair of 3 bridges and maintain 680km of external
the Group also develops infrastructure such as construction and repair of 3 bridges and maintain 680km of external
roads in 2015. The Group also provides initial aid and seed capital to villagers such as fruit seedlings, fish fries,
roads in 2015. The Group also provides initial aid and seed capital to villagers such as fruit seedlings, fish fries,
roads in 2015. The Group also provides initial aid and seed capital to villagers such as fruit seedlings, fish fries,
roads in 2015. The Group also provides initial aid and seed capital to villagers such as fruit seedlings, fish fries,
cattle and ducks to start community sustainable programs.
cattle and ducks to start community sustainable programs.
cattle and ducks to start community sustainable programs.
cattle and ducks to start community sustainable programs.
Indonesian Sustainable Palm Oil (“ISPO”)
Indonesian Sustainable Palm Oil (“ISPO”)
Indonesian Sustainable Palm Oil (“ISPO”)
Indonesian Sustainable Palm Oil (“ISPO”)
The ISPO certification is legally mandatory for all plantations in Indonesia. In March 2012, ISPO, which is
The ISPO certification is legally mandatory for all plantations in Indonesia. In March 2012, ISPO, which is
The ISPO certification is legally mandatory for all plantations in Indonesia. In March 2012, ISPO, which is
The ISPO certification is legally mandatory for all plantations in Indonesia. In March 2012, ISPO, which is
fundamentally aligned to RSPO (Roundtable on Sustainable Palm Oil) principles, has become the mandatory
fundamentally aligned to RSPO (Roundtable on Sustainable Palm Oil) principles, has become the mandatory
fundamentally aligned to RSPO (Roundtable on Sustainable Palm Oil) principles, has become the mandatory
fundamentally aligned to RSPO (Roundtable on Sustainable Palm Oil) principles, has become the mandatory
standard for Indonesian planters.
standard for Indonesian planters.
standard for Indonesian planters.
standard for Indonesian planters.
A Steering Committee was established to work out a roadmap to support the ISPO implementation at mills and
A Steering Committee was established to work out a roadmap to support the ISPO implementation at mills and
A Steering Committee was established to work out a roadmap to support the ISPO implementation at mills and
A Steering Committee was established to work out a roadmap to support the ISPO implementation at mills and
estates. Workshops and training sessions on occupational safety and healthcare were carried out to inculcate a
estates. Workshops and training sessions on occupational safety and healthcare were carried out to inculcate a
estates. Workshops and training sessions on occupational safety and healthcare were carried out to inculcate a
estates. Workshops and training sessions on occupational safety and healthcare were carried out to inculcate a
safety culture in workplaces at the estates and mills in North Sumatera, Riau, Bengkulu and Kalimantan. During the
safety culture in workplaces at the estates and mills in North Sumatera, Riau, Bengkulu and Kalimantan. During the
safety culture in workplaces at the estates and mills in North Sumatera, Riau, Bengkulu and Kalimantan. During the
safety culture in workplaces at the estates and mills in North Sumatera, Riau, Bengkulu and Kalimantan. During the
year the Group continued to upgrade its agricultural chemical stores and diesel fuel storage tanks in various
year the Group continued to upgrade its agricultural chemical stores and diesel fuel storage tanks in various
year the Group continued to upgrade its agricultural chemical stores and diesel fuel storage tanks in various
year the Group continued to upgrade its agricultural chemical stores and diesel fuel storage tanks in various
plantations and mills to meet safety and environmental standards. Standard operating procedures were refined and
plantations and mills to meet safety and environmental standards. Standard operating procedures were refined and
plantations and mills to meet safety and environmental standards. Standard operating procedures were refined and
plantations and mills to meet safety and environmental standards. Standard operating procedures were refined and
documented based on sustainable oil palm best practices. The Group also conducts internal audits using an audit
documented based on sustainable oil palm best practices. The Group also conducts internal audits using an audit
documented based on sustainable oil palm best practices. The Group also conducts internal audits using an audit
documented based on sustainable oil palm best practices. The Group also conducts internal audits using an audit
checklist adopted from the above practices to determine the level of compliance. The Group worked closely with
checklist adopted from the above practices to determine the level of compliance. The Group worked closely with
checklist adopted from the above practices to determine the level of compliance. The Group worked closely with
checklist adopted from the above practices to determine the level of compliance. The Group worked closely with
appointed certification consultants in the implementation of ISPO standard. In addition to three subsidiaries which
appointed certification consultants in the implementation of ISPO standard. In addition to three subsidiaries which
appointed certification consultants in the implementation of ISPO standard. In addition to three subsidiaries which
appointed certification consultants in the implementation of ISPO standard. In addition to three subsidiaries which
were ISPO certified, another subsidiary has been approved for ISPO certification in December 2015. Six companies
were ISPO certified, another subsidiary has been approved for ISPO certification in December 2015. Six companies
were ISPO certified, another subsidiary has been approved for ISPO certification in December 2015. Six companies
were ISPO certified, another subsidiary has been approved for ISPO certification in December 2015. Six companies
are at the second stage of ISPO audit while one company is at first stage of certification.
are at the second stage of ISPO audit while one company is at first stage of certification.
are at the second stage of ISPO audit while one company is at first stage of certification.
are at the second stage of ISPO audit while one company is at first stage of certification.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Care For The Environment and Sustainable Practices
As a Group, we highlight the importance of creating awareness and implementation of good environmental
management practices throughout the organisation. The Group has been consistently practising good agricultural
practices such as zero burning, integrated pest management, land terracing and recycling of biomass. When it
comes to replanting, old palms felled are chipped and left to decompose at site. This mitigates the greenhouse gas
emissions commonly associated with open burning when land is cleared through the traditional method of slash-and-
burn. It also enriches the organic matter in the soil. Where the land is undulating, we build terraces for planting which
helps to prevent landslides, conserve the water and nutrients effectively and provide better accessibility for
employees. Legume cover crops are planted to minimise soil erosion and preserve the soil moisture. In mature
areas, fronds and EFB are placed inter-rows to allow the slow release of organic nutrients while minimising soil
erosion and degradation.
Effluent discharged from some mills is initially treated in lagoons before being applied to trenches located between
rows of palm trees. Once the effluent dries up, it becomes organic fertilizer for the oil palm and reduces the
application and buying of inorganic fertilizers. In some estates, EFB are applied to land where it biodegrades to
fertilizers. Through the application of a combination of EFB, organic fertilisers from mill by-products and inorganic
fertilisers, the Group is able to raise the fertility of sandy soil in Kalimantan plantations.
The Group’s first biogas and biomass project in North Sumatera completed last year will enhance the waste
management treatment in the mill and at the same time mitigate greenhouse biogas emissions. The methane gas
trapped will be used to generate and supply power to its biomass plant without dependency on fossil fuel. Another
biogas plant is being constructed at the new mill in Kalimantan. Further similar undertakings for the Group’s mills are
planned and shall be implemented in stages. The Group intends to sell surplus power generated to the National Grid.
The Group is committed to implementing good agricultural practices as spelled out in its standard operating
procedures for the planting of oil palm. Integrated Pest Management has been adopted to control pests and to
improve biological balance.
Barn Owls were introduced to control rats. Beneficial plants of Turnerasp, Cassia cobannesis and Antigononleptosus
were planted to attract natural predators for biological control of bagworms and leaf-eating caterpillars. Weeds are
controlled selectively by using more environmental friendly herbicide such as Glyphosate.
The usage of Paraquat herbicide and chemicals has been reduced and minimized to control weeds and vermins.The
sprayers are also trained in safety and spraying techniques. The chemicals are kept in designated storage and
examined at regular intervals. Employees who handled the use of chemicals undergo medical examination. Natural
vegetation on uncultivable land such as deep peat, very steep areas and riparian zones along watercourses are
maintained to preserve biodiversity and wildlife corridors.
Two mills in the Bengkulu region have been installed with Extended Aeration to enhance the treatment of the mill
effluent by mechanical aeration.
All our mills utilize the waste mesocarp fibre from the oil palm fruits as fuel to generate steam from boilers to
eventually produce power from steam turbines. The power generated drives all of the processing equipment in mills
and estate housing. This helps to reduce reliance on fossil fuel such as diesel in our milling operations.
The Group continues to comply and preserve the High Conservative Value (“HCV”) areas recognised by the
Department of Forestry.
Principal risks and uncertainties
The Group’s business involves risks and uncertainties of which the Directors currently consider the following to be
material. There are or may be other risks and uncertainties faced by the Group that the Directors currently deem
immaterial, or of which they are unaware, that may have a material adverse impact on the Group. The Board carries
out a robust assessment of the principal risks facing the Group on an annual basis.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Nature of the risk and its origin
Nature of the risk and its origin
Country and regulatory
Country and regulatory
The likelihood and impact of the
The likelihood and impact of the
the circumstances
risk and
the circumstances
risk and
under which the risk might be
under which the risk might be
most relevant to the Company
most relevant to the Company
Mitigating or other
considerations
Mitigating or other
considerations
relevant
relevant
in
The Group’s operations are located
The Group’s operations are located
Indonesia and
substantially
in
substantially
Indonesia and
therefore
rely on
significantly
therefore
rely on
significantly
economic and political stability in
economic and political stability in
Indonesia.
Indonesia.
upheaval
Political
and
Political
and
upheaval
deterioration in security situation
deterioration in security situation
may cause disruption on operation
may cause disruption on operation
and consequently financial loss.
and consequently financial loss.
The country has recently benefited
The country has recently benefited
from a period of relative political
from a period of relative political
stability, steady economic growth
stability, steady economic growth
and stable financial system. But
and stable financial system. But
during the Asian financial crisis in
during the Asian financial crisis in
late 1990 there were civil unrest
late 1990 there were civil unrest
attributed to ethnic tensions in
attributed to ethnic tensions in
some parts of Indonesia. But the
some parts of Indonesia. But the
Group
not
operations were
Group
not
interrupted by the regional security
interrupted by the regional security
problems.
problems.
operations were
Introduction of measures to rein in
Introduction of measures to rein in
the country’s fiscal deficits. This
the country’s fiscal deficits. This
included the exchange controls and
included the exchange controls and
restriction on repatriation of profit
restriction on repatriation of profit
through payment of dividend.
through payment of dividend.
rights
the
land
the
land
The Group acquires
The Group acquires
(“HGU”) after
rights
(“HGU”) after
exploitation
exploitation
paying land acquisition and HGU
paying land acquisition and HGU
processing costs. These costs are
processing costs. These costs are
capitalized as
land asset costs
capitalized as
land asset costs
since the asset characteristics fulfill
since the asset characteristics fulfill
the recognition criteria. The Group
the recognition criteria. The Group
holds its land under 25 or 35 year
holds its land under 25 or 35 year
renewable leases.
renewable leases.
Changes in land legislation. Based
Changes in land legislation. Based
on National Land Agency Law 2 /
on National Land Agency Law 2 /
1999, mandatory restriction to land
1999, mandatory restriction to land
ownership by non-state plantation
ownership by non-state plantation
companies and companies not
companies and companies not
listed in Indonesia to 20,000ha per
listed in Indonesia to 20,000ha per
province and a total of 100,000ha in
province and a total of 100,000ha in
Indonesia.
Indonesia.
Transfer of profit from Indonesia to
Transfer of profit from Indonesia to
UK will be restricted affecting
UK will be restricted affecting
servicing of UK obligations and
servicing of UK obligations and
payment
to
of
payment
to
of
shareholders.
shareholders.
dividends
dividends
the government
The Board is not aware of any
The Board is not aware of any
to
attempt by
attempt by
to
the government
that
impose exchange controls
that
impose exchange controls
would restrict the transfer of profits
would restrict the transfer of profits
from Indonesia to the UK. The
from Indonesia to the UK. The
Board perceives that the Group
Board perceives that the Group
will be able to continue to extract
will be able to continue to extract
profits
in
profits
in
Indonesia
foreseeable
Indonesia
foreseeable
future.
future.
its subsidiaries
for
its subsidiaries
the
from
for
from
the
in
law
law
changes
changes
Any
and
Any
and
in
regulations relating to land tenure
regulations relating to land tenure
could have negative impact on the
could have negative impact on the
Group’s activities.
Group’s activities.
There are several more years
There are several more years
before the first HGU is due for
before the first HGU is due for
renewal in 2023. There are no
renewal in 2023. There are no
reasons
to
reasons
to
believe that the HGU will not be
believe that the HGU will not be
renewed upon expiration by
renewed upon expiration by
complying with existing law and
complying with existing law and
regulations.
regulations.
the Directors
the Directors
for
for
foreign
Mandatory reduction of
foreign
Mandatory reduction of
ownership
Indonesian
in
Indonesian
ownership
in
plantations. Forced divestment of
plantations. Forced divestment of
interests in Indonesia at below
interests in Indonesia at below
market values.
market values.
The Group realize that there is a
possibility that foreign owners may
be required over time to partially
divest ownership of Indonesia oil
palm operations but has no reason
to believe that such divestment
would be anything other than at
market value.
The Group realize that there is a
possibility that foreign owners may
be required over time to partially
divest ownership of Indonesia oil
palm operations but has no reason
to believe that such divestment
would be anything other than at
market value.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Nature of the risk and its origin
Nature of the risk and its origin
The likelihood and impact of the
The likelihood and impact of the
the circumstances
risk and
the circumstances
risk and
under which the risk might be
under which the risk might be
most relevant to the Company
most relevant to the Company
Mitigating or other
Mitigating or other
considerations
considerations
relevant
relevant
Country and regulatory (cont’d)
Country and regulatory (cont’d)
Group failure to meet the standards
Group failure to meet the standards
expected in relation to bribery and
expected in relation to bribery and
corruption.
corruption.
Reputational damage and criminal
Reputational damage and criminal
sanctions.
sanctions.
Exchange rates
Exchange rates
a
a
and
and
revenue costs
revenue costs
CPO is a US Dollar denominated
CPO is a US Dollar denominated
significant
commodity
commodity
significant
in
proportion of
in
proportion of
Indonesia (such as fertiliser and
Indonesia (such as fertiliser and
fuel) and development costs (such
fuel) and development costs (such
as heavy machinery and mills
as heavy machinery and mills
equipment) are imported and are
equipment) are imported and are
US Dollar related.
US Dollar related.
Weather and natural disasters
Weather and natural disasters
rainfall but
rainfall but
Oil palms rely on regular sunshine
Oil palms rely on regular sunshine
and
these weather
and
these weather
patterns can vary and extremes
patterns can vary and extremes
such as unusual dry periods or,
such as unusual dry periods or,
conversely, heavy rainfall leading to
conversely, heavy rainfall leading to
flooding
locations can
flooding
locations can
occur.
occur.
in some
in some
Adverse movements of Rupiah
Adverse movements of Rupiah
against US Dollar can have a
against US Dollar can have a
negative effect on the operating
negative effect on the operating
costs and raise funding cost.
costs and raise funding cost.
in particular, will
Dry periods,
in particular, will
Dry periods,
affect yields
in the short and
affect yields
in the short and
medium terms. Drought induces
medium terms. Drought induces
moisture stress in palm trees.
moisture stress in palm trees.
High levels of rainfall can disrupt
High levels of rainfall can disrupt
estate operations and result in
estate operations and result in
harvesting delays with loss of oil
harvesting delays with loss of oil
palm fruits or deterioration in fruit
palm fruits or deterioration in fruit
quality. Any delay in collection of
quality. Any delay in collection of
harvested FFB during the rainy
harvested FFB during the rainy
season could raise the level of
season could raise the level of
free fatty acid (“FFA”) in the CPO.
free fatty acid (“FFA”) in the CPO.
CPO with higher level of FFA will
CPO with higher level of FFA will
be sold at a discount to market
be sold at a discount to market
level of sunshine
prices. Low
level of sunshine
prices. Low
could result in delay in formation
could result in delay in formation
of FFB resulting in potential loss of
of FFB resulting in potential loss of
revenue.
revenue.
The Group continues to maintain
The Group continues to maintain
strong controls in this area as
strong controls in this area as
Indonesia has been classified as
Indonesia has been classified as
the
relatively high
the
relatively high
International
Transparency
Transparency
International
Corruption Perceptions index.
Corruption Perceptions index.
risk by
risk by
The Board has taken the view that
The Board has taken the view that
these risks are inherent in the
these risks are inherent in the
business and feels that adopting
business and feels that adopting
hedging mechanisms to counter
hedging mechanisms to counter
the negative effects of
foreign
the negative effects of
foreign
volatility are both
volatility are both
exchange
exchange
difficult to achieve and would not
difficult to achieve and would not
be cost effective.
be cost effective.
Where appropriate, bunding
is
is
Where appropriate, bunding
built around flood prone areas and
built around flood prone areas and
canals/drainage constructed and
canals/drainage constructed and
adapted either to evacuate surplus
adapted either to evacuate surplus
water or to maintain water levels in
water or to maintain water levels in
areas quick to dry out. Where
areas quick to dry out. Where
practical, natural disasters are
practical, natural disasters are
covered by
insurance policy.
insurance policy.
covered by
Certain risks (including the risk of
Certain risks (including the risk of
crop loss through fire, earthquake,
crop loss through fire, earthquake,
flood and other perils potentially
flood and other perils potentially
affecting the planted areas on the
affecting the planted areas on the
Group’s estates) if they materialise
Group’s estates) if they materialise
could dent the potential revenues,
could dent the potential revenues,
for which insurance cover is either
for which insurance cover is either
not available or would
the
the
not available or would
opinion of
the Directors be
the Directors be
opinion of
disproportionately expensive, are
disproportionately expensive, are
not insured. These risks of floods
not insured. These risks of floods
the
or haze are mitigated by
the
or haze are mitigated by
geographical
the
of
geographical
the
of
plantations but an occurrence of
plantations but an occurrence of
an adverse uninsured event could
an adverse uninsured event could
result
the Group sustaining
the Group sustaining
in
in
result
material losses.
material losses.
spread
spread
in
in
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Nature of the risk and its origin
Nature of the risk and its origin
Cultivation risks
Cultivation risks
The Group’s plantations may be
The Group’s plantations may be
affected by pests and diseases like
affected by pests and diseases like
ganoderma fungus and white rot.
ganoderma fungus and white rot.
Crop damages by oryctes beetles,
Crop damages by oryctes beetles,
nettie caterpillar, termites, vermins,
nettie caterpillar, termites, vermins,
elephants and wild boars are
elephants and wild boars are
common.
common.
Other operational factors
Other operational factors
The Group’s plantation productivity
The Group’s plantation productivity
is dependent upon necessary
is dependent upon necessary
inputs,
in particular
in particular
inputs,
fertiliser, spare-parts, chemicals
fertiliser, spare-parts, chemicals
and fuel.
and fuel.
including,
including,
The Group has bulk storage
The Group has bulk storage
facilities
its mills
located within
its mills
located within
facilities
which are adequate to meet the
which are adequate to meet the
for CPO
requirements
Group’s
for CPO
requirements
Group’s
storage. Nevertheless, delays
in
in
storage. Nevertheless, delays
collection of CPO sold could result
collection of CPO sold could result
in CPO production exceeding the
in CPO production exceeding the
available CPO storage capacity.
available CPO storage capacity.
increases
increases
Substantial
in
in
Substantial
governmental directed minimum
governmental directed minimum
wage levels in Indonesia.
wage levels in Indonesia.
The likelihood and impact of the
The likelihood and impact of the
the circumstances
risk and
the circumstances
risk and
under which the risk might be
under which the risk might be
most relevant to the Company
most relevant to the Company
Mitigating or other
Mitigating or other
considerations
considerations
relevant
relevant
these
these
risks but
risks but
Agricultural best practice and
Agricultural best practice and
husbandry can to some extent
husbandry can to some extent
mitigate
they
they
mitigate
cannot be entirely eliminated. The
cannot be entirely eliminated. The
spread
the
of majority
the
of majority
spread
plantations over Sumatera and
plantations over Sumatera and
Kalimantan mitigates
risks
risks
Kalimantan mitigates
affecting the entire Group.
affecting the entire Group.
the
the
of
of
inputs,
inputs,
Whilst
the Directors have no
the Directors have no
Whilst
reason to anticipate shortages of
reason to anticipate shortages of
the Group’s
such
the Group’s
such
investment in biogas plants will
investment in biogas plants will
reduce reliance on fossil fuel for
reduce reliance on fossil fuel for
the mill operations.
the mill operations.
substantial
substantial
The Group bulk storage facilities
The Group bulk storage facilities
have
capacity.
capacity.
have
Furthermore these facilities have
Furthermore these facilities have
always being adequate for the
always being adequate for the
mills production storage in the
mills production storage in the
past.
past.
The Group endeavours to improve
The Group endeavours to improve
productivity of field workers to
productivity of field workers to
justify the increase in wages. Field
justify the increase in wages. Field
workers are employed on part-
workers are employed on part-
time basis.
time basis.
Loss of crops or reduction in the
Loss of crops or reduction in the
quality of harvest resulting in loss
quality of harvest resulting in loss
of potential revenue.
of potential revenue.
With the removal of fuel subsidy
With the removal of fuel subsidy
by the Indonesian government in
by the Indonesian government in
January 2015, diesel will be priced
January 2015, diesel will be priced
in accordance to global oil prices.
in accordance to global oil prices.
When global oil prices rise, it will
When global oil prices rise, it will
put pressure on production inputs
put pressure on production inputs
which include cost of electricity to
which include cost of electricity to
the mills and the transportation of
the mills and the transportation of
FFB. Group’s operations could be
FFB. Group’s operations could be
materially disrupted should such
materially disrupted should such
shortages occur over an extended
shortages occur over an extended
period. Increase in prices would
period. Increase in prices would
significantly
increase production
increase production
significantly
costs.
costs.
likely
likely
force
force
This would
a
a
This would
temporary halt in FFB processing
temporary halt in FFB processing
resulting
loss of crop and
loss of crop and
resulting
revenue.
revenue.
in
in
Regional hikes in minimum wages
Regional hikes in minimum wages
for 2016 averaged 10.4%. The
for 2016 averaged 10.4%. The
Group pays no less than the
Group pays no less than the
minimum wage and the increase
minimum wage and the increase
will result in a significant rise in
will result in a significant rise in
Group’s employment costs. Higher
Group’s employment costs. Higher
wages will erode the profitability
wages will erode the profitability
as it forms a substantial part of the
as it forms a substantial part of the
production costs.
production costs.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Strategic Report
Nature of the risk and its origin
Nature of the risk and its origin
Produce prices
Produce prices
CPO is a primary commodity and is
CPO is a primary commodity and is
affected by the world economy,
affected by the world economy,
inflation, availability of
levels of
levels of
inflation, availability of
alternative soft oils such as soya
alternative soft oils such as soya
oils. CPO price also moves in
oils. CPO price also moves in
tandem with crude oil prices which
tandem with crude oil prices which
determines the competitiveness of
determines the competitiveness of
CPO as a source of biodiesel.
CPO as a source of biodiesel.
The likelihood and impact of the
The likelihood and impact of the
the circumstances
risk and
risk and
the circumstances
under which the risk might be
under which the risk might be
most relevant to the Company
most relevant to the Company
Mitigating or other
Mitigating or other
considerations
considerations
relevant
relevant
This may lead to significant price
This may lead to significant price
swings. The profitability and cash
swings. The profitability and cash
flow of the plantation operations
flow of the plantation operations
depend upon world prices of CPO
depend upon world prices of CPO
and upon the Group’s ability to sell
and upon the Group’s ability to sell
CPO at price levels comparable
CPO at price levels comparable
with world prices.
with world prices.
be moderated
be moderated
Directors believe that such swings
Directors believe that such swings
should
by
should
by
continuous demand in economies
continuous demand in economies
like China, India and Indonesia.
like China, India and Indonesia.
Larger export would lead to lower
Larger export would lead to lower
inventory of CPO which augurs
inventory of CPO which augurs
well for future produce price.
well for future produce price.
import controls or
import controls or
Imposition of
Imposition of
taxes in consuming and exporting
taxes in consuming and exporting
countries.
Indonesian
Indonesian
The
The
countries.
government in July 2015 imposes a
government in July 2015 imposes a
$50/mt export levy to fund biodiesel
$50/mt export levy to fund biodiesel
introduced a
subsidies.
introduced a
subsidies.
simpler
system
system
tax
tax
simpler
expressed in US dollar instead of a
expressed in US dollar instead of a
percentage of CPO price.
percentage of CPO price.
It also
It also
export
export
levy will
levy will
Reduced revenue and reduction in
Reduced revenue and reduction in
cash flow and profit. When CPO
cash flow and profit. When CPO
price is below $750/mt, the export
price is below $750/mt, the export
tax
impact upon the
tax
impact upon the
Group’s profit. When CPO price
Group’s profit. When CPO price
recovers to above $750/mt, the
recovers to above $750/mt, the
effective tax rate will be lower
effective tax rate will be lower
providing some relief to planters.
providing some relief to planters.
Indonesian
Indonesian
government
government
The
The
allows free export of CPO but
allows free export of CPO but
applies a sliding scale of duties on
applies a sliding scale of duties on
exports which allows producers
exports which allows producers
economic margins. The export
economic margins. The export
regarded as a
levy may be
regarded as a
levy may be
support CPO
to
measure
support CPO
to
measure
producers
in
increase
through
producers
in
increase
through
biodiesel consumption.
biodiesel consumption.
Environmental and governance practices
Environmental and governance practices
ISPO which
ISPO which
fundamentally
fundamentally
The
The
aligns with RSPO
principles
principles
aligns with RSPO
became the mandatory standard for
became the mandatory standard for
all Indonesian planters in March
all Indonesian planters in March
2012. The key RSPO principles are
2012. The key RSPO principles are
set out on page 43
the
the
set out on page 43
“Statement
Corporate
Corporate
“Statement
Governance”.
Governance”.
on
on
in
in
pollutions
pollutions
and
and
Environment
Environment
criticism by environmental activists
criticism by environmental activists
resulting
reputational and
reputational and
resulting
financial damage.
financial damage.
in
in
and
and
The Directors take seriously their
The Directors take seriously their
social
environmental
social
environmental
Management
responsibilities.
Management
responsibilities.
best-practice
industry
follows
best-practice
industry
follows
by
abides
and
guidelines
by
abides
and
guidelines
Indonesian law with regard to such
Indonesian law with regard to such
matters as health and safety. The
matters as health and safety. The
Group uses EFB for mulching in
Group uses EFB for mulching in
the estates which is a form of
the estates which is a form of
fertiliser
the
the
fertiliser
consumption
inorganic
inorganic
consumption
fertilisers. The liquid effluent from
fertilisers. The liquid effluent from
the mills after treatment is applied
the mills after treatment is applied
to trenches in the estates as a
to trenches in the estates as a
form of fertiliser. The biogas plant
form of fertiliser. The biogas plant
in North Sumatera will mitigate
in North Sumatera will mitigate
biogas.
of
emissions
biogas.
of
emissions
Environmental impact assessment
Environmental impact assessment
is undertaken by an independent
is undertaken by an independent
consultant for its new project.
consultant for its new project.
reduces
reduces
of
of
and
and
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Nature of the risk and its origin
Expansion
The Group is planning to plant more
oil palm. In areas where the Group
holds the land compensation rights
(or Izin lokasi), the settlers and land
owners are compensated before
land is cleared for planting.
and
cash
resources
The Directors believe that when the
land becomes available for planting,
the development programmes can
be funded from available Group
future
cash
operational
flows,
supplemented with external debt
funding. 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 development period
and
is
affected by changes in commodity
prices.
requirement
the cash
The likelihood and impact of the
risk and
the circumstances
under which the risk might be
most relevant to the Company
Mitigating or other
considerations
relevant
The Group compensates
the
settlers and land owners in a
transparent and fair way. The
negotiation for compensation can,
however involve a considerable
number of local individuals with
similar ownership claims and this
can cause difficulties in reaching
agreement with
affected
parties. Such disruptions have in
the past caused delays to the
and
planting
consequently financial loss.
programmes
all
Should land or cash availability fall
short of expectations and
the
Group
to secure
is unable
alternative land or funding, the
Group’s continued growth may be
delayed or curtailed. This may
lead to reduction of reported profit
and adverse market perceptions
as to the value of the Company’s
shares.
It is rather difficult to foresee with
reliable accuracy what area will be
available for planting out of the
total area covered by land rights.
Much depends upon the success
of negotiations with settlers and
land owners and satisfactory
resolution of land title issue. The
Group has to-date mixed success
in managing such periodic delays
and disruptions especially in South
Sumatera, Bengkulu, Bangka and
Kalimantan.
The Group has fair amount of
fund planting
cash holding
to
exercise. The Group aims
to
manage
finances
its
conservatively to ensure that it is
able to fund the planned planting
programme.
Hedging risk
The Group's subsidiaries have
borrowing in US Dollar.
The Group could face significant
exchange losses in the event of
depreciation of their local currency
(i.e. Strengthening of US Dollar) -
and vice versa.
Risk is partially mitigated by US
Dollar
cash
denominated
balances. It also considers the
average interest rate on Rupiah
deposits which is 7.47% higher
than on US Dollar deposits
whereas interest rate for Rupiah
borrowing is about 6.65% higher
as compared
to US Dollar
borrowing.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Nature of the risk and its origin
The likelihood and impact of the
the circumstances
risk and
under which the risk might be
most relevant to the Company
Mitigating or other
considerations
relevant
Social, community and human rights issues
could
Any material breakdown in relations
between the Group and the host
population in the vicinity of the
the
operations
Group’s operations. The plantations
hire large numbers of people and
have
economic
importance for local communities in
the areas of the Group’s operations.
significant
disrupt
Communication breakdown would
cause disruption on operation and
consequently financial loss.
local
living standards
The Group endeavours to mitigate
this risk by liaising regularly with
representatives of surrounding
villages and by seeking to improve
local
through
mutually beneficial economic and
social interaction with the local
villages. In particular, the Group,
when possible, gives priority to
applications for employment from
members of the local population
and supports specific initiatives to
encourage
farmers and
tradesmen to act as suppliers to
the Group, its employees and their
dependents. The Group spends
considerable sums of money
constructing new
roads and
bridges and maintaining existing
roads used by villagers. The
Group also provides technical and
management expertise to villagers
to develop oil palm plots or Kebun
Kas Desa (village’s scheme) and
plasma schemes surrounding the
returns
operating estates. The
from
to
community
improve
welfare.
these plots are used
villages’
Interest rate risk
The Group's surplus cash and its
borrowings are subject to variable
interest rates.
is no policy
There
to hedge
interest rates, partly because of
the net cash position and because
the net interest is relatively small
proportion of the Group profits.
net
The Group had
cash
throughout 2015, 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 Group’s reported
results as shown in note 23. The
rates on borrowings are set out in
note 14.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Gender diversity
The AEP Plc Board is composed of three men and one woman with extensive knowledge in their respective fields of
experience. The Board has taken note of the recent legislative initiatives with regard to the representation of women
on the boards of Directors of listed companies and will make every effort to conform to its composition based on
legislative requirement.
Group Headcount
Board
Senior Management (GM and Above)
Managers & Executives
Full Time
Part-time Field Workers
Total
%
2015 average employed during the year
Total
16
Women
2
Men
14
-
30
314
4,745
5,091
30%
8
369
5,095
6,235
11,721
70%
8
399
5,409
10,980
16,812
100%
Group Headcount
Board
Senior Management (GM and Above)
Managers & Executives
Full Time
Part-time Field Workers
Total
%
2014 average employed during the year
Women
2
-
23
168
3,005
3,198
21%
Men
14
8
363
4,944
6,682
12,011
79%
Total
16
8
386
5,112
9,687
15,209
100%
Although the Group provides equal opportunities for female workers in the plantations, the male workers make up a
majority of the field workers due to the nature of work and the remote location of plantations from the towns and
cities. Nevertheless the percentage of women workforce within the Group increased from 21% in 2014 to 30% in
2015.
Employees
In 2015, the number of full time workforce averaged 5,832 (2014: 5,522) while the part-time labour averaged 10,980
(2014: 9,687).
The Group has formal processes for recruitment particularly key managerial positions, where psychometric testing is
conducted to support the selection and hiring decisions. Exit interviews are also conducted with departing employees
to ensure that management can address any significant issues.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
The Group has a programme for recruiting graduates from Indonesian universities to join existing employees
selected on regular basis to training programmes organised by the Group’s training centre that provides grounding
and refresher courses in technical aspects of oil palm estate and mill management. The training centre also conducts
regular programmes for all levels of employees to raise the competency and quality of employees in general. These
programmes are often supplemented by external management development courses including attending industry
conferences for technical updates. A wide variety of topics are covered including work ethics, motivation, self-
improvement, company values, health and safety.
A large workforce and their families are housed in the Group’s housing across the Group’s plantations. The Group
further provides at its own cost water and electricity and a host of other amenities including places of worship,
schools and clinics. On top of competitive salaries and bonuses, extensive benefits and privileges help the Group to
retain and motivate its employees.
The Group promotes a policy for creation of equal and ethnically diverse employment opportunities including with
respect to gender.
The Group has in place key performance linked indicators to determine increment and bonus entitlements for its
employees.
The Group promotes and encourages employee involvement in every aspect wherever practical as it recognises
employees as a valuable asset and is one of the key contributions to the Group’s success. The employees contribute
their ideas, feedback and voice out their concerns through formal and informal meetings, discussions and annual
performance appraisal. In addition, various work related and personal training programmes are carried out annually
for employees to promote employee engagement and interaction.
Although the Group does not have a specific policy on employment of disabled persons, it however employs disabled
persons as part of its workforce. The Group welcomes disabled persons joining the Group based on their suitability.
Outlook
FFB production for three months to March 2016 was 9% higher against the same period in 2015 mainly due to the
increase in production from Kalimantan region. It is too early to forecast whether the production will be better for the
rest of the year.
The CPO CIF (Cost, Insurance, Freight) Rotterdam price opened the year 2016 at $570/mt and prices are expected
to be in the range of $500/mt to $750/mt for the first half of 2016. CPO price is likely to recover if a significant drop in
crop production materialises due to the effects of El Nino in 2015.
It was reported that the US Dollar appreciated by approximately 13% (2014: +2%) against the Indonesian Rupiah in
2015 in anticipation of an interest rate hike in the United States and the weak emerging economies. The Rupiah has
since strengthened by 4% in 2016 which makes palm oil more expensive for importers.
The continuing rise in income levels and population growth in China, India and Indonesia would expect to drive the
consumption of CPO and likely lead to a gradual recovery in CPO prices. The Indonesian and Malaysian government
efforts to rein in fiscal deficits by introducing higher mandatory blending of biodiesel could provide some price
support.
The rising material costs and wages in Indonesia are expected to increase the overall production cost in 2016.
Indonesia's minimum wage has increased at an average rate of between 8% and 15% per annum over the last few
years. The Indonesian government recently announced regional hikes in 2016 minimum wage ranging from 7% in
Bengkulu to 12% in South Sumatera. These wage hikes will raise overall estate costs and erode profit margins. A
depreciating Rupiah would also mean that imports of fertilisers and equipment for the mills and estates will be more
costly.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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27
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Strategic Report
Nevertheless barring any unforeseen circumstances, the Group is confident that CPO demand will be sustainable in
the long term on the backdrop of global economic recovery and we can expect a satisfactory profit level and cash
flow for 2016.
On behalf of the Board
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
26 April 2016
Annual Report 2015 | Anglo-Eastern Plantations Plc
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28
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Financial Record
Income statement
Revenue
2015
$000
2014
$000
(Restated)
2012
$000
(Restated)
2011
$000
2013
$000
196,451
251,258
201,917
237,352
259,037
Trading profit before BA
42,728
78,845
59,619
85,396
98,518
(Loss) / Profit attributable to shareholders after
BA
(14,897)
30,762
93,521
47,331
73,681
Dividend proposed for year
(1,028)
(1,854)
(1,969)
(1,784)
(2,372)
Financial position
Non-current assets & long term receivables
Cash net of short term borrowings
Long term loans
Other working capital
Deferred tax
Non-controlling interest
Net worth
$000
402,655
102,864
(32,875)
225
(20,911)
451,958
(82,607)
$000
481,761
125,624
(34,625)
(10,343)
(44,368)
518,049
(90,813)
$000
484,826
98,654
(34,937)
765
(55,298)
494,010
(85,964)
$000
424,889
116,198
(25,026)
(7,460)
(37,236)
471,365
(83,043)
$000
413,801
84,017
(58)
(14,076)
(43,098)
440,586
(73,533)
369,351
427,236
408,046
388,322
367,053
Share capital
Treasury shares
Share premium and capital redemption account
Revaluation and exchange reserve
Profit and loss account
15,504
(1,171)
25,022
(174,896)
504,892
15,504
(1,171)
25,022
(133,474)
521,355
15,504
(1,171)
25,022
(124,340)
493,031
15,504
(1,171)
25,022
(52,039)
401,006
15,504
(1,507)
25,022
(27,880)
355,914
Equity attributable to shareholders’ funds
369,351
427,236
408,046
388,322
367,053
Ordinary shares in issue (‘000s)
Earnings per share before BA adj. (US cents)
Earnings per share after BA adj. (US cents)
Dividend per share for year (US cents)
Asset value per share (US cents)
Earnings per share before BA adj (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
69.39cts
(37.58)cts
2.5*cts
932cts
39,976
132.26cts
77.61cts
4.5cts
1,078cts
39,976
90.70cts
235.95cts
5.0cts
1,029cts
45.4p
1.75p
629p
13,795
1.48
4.29
13,392
1.53
3.91
80.2p
3.0p
691p
12,385
1.56
3.50
11,861
1.65
3.27
58.0p
3.0p
622p
12,170
1.66
3.28
10,445
1.56
3.15
Note: * Based on exchange rate at 22 April 2016 of $1.4409/£
Annual Report 2015 | Anglo-Eastern Plantations Plc
39,976
39,976
133.99cts 154.15cts
119.41cts 186.35cts
6.0cts
928cts
4.5cts
980cts
84.5p
2.9p
603p
9,638
1.63
3.06
9,363
1.59
3.09
95.5p
3.7p
597p
9,068
1.55
3.17
8,763
1.61
3.06
29
29
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Estate Areas
Annual Report 2015 | Anglo-Eastern Plantations Plc
30
30
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Location of Estates
Location of Estates
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
31
31
31
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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 2015.
Accountability and audit
The Group is committed to ensure that the quality of its financial reporting is of a high standard. The Board
continually reviews its internal controls and risk management systems to ensure the Group’s affairs and the Group’s
financial reporting comply with the applicable accounting standards as well as good corporate governance. The main
features of the Group’s internal controls and risk management systems are further disclosed on page 46.
The Board considers the annual report and accounts including the strategic report when taken as a whole, is fair,
balanced and understandable as it provides the information necessary for shareholders to assess the Group’s
position and performance, business model and strategy.
Results and dividends
The audited financial statements for the year ended 31 December 2015 are set out on pages 59 to 99. The Group’s
loss for the year on ordinary activities before taxation was $19,074,000 (2014: profit $51,236,000) and the loss
attributable to ordinary shareholders was $14,897,000 (2014: profit $30,762,000). No interim dividend was paid. The
Directors recommend a final dividend of 1.75p (2014: 3.0p) to be paid to shareholders on 11 July 2016.
Shareholders may elect to receive their dividend in US Dollar as described on page 37.
Viability Statement
The viability assessment considers solvency and liquidity over a longer period than for the purposes of the going
concern assessment made on page 13. Inevitably, the degree of certainty reduces over this longer period.
The Group’s business activities, financial performance, corporate development and principal risks associated with
the local operating environment are covered under the Strategic Report. In undertaking its review of the Group’s
performance in 2015, the Board considered the prospects of the Company over the one and five-year periods. The
process involved a detailed review of the 2016 detailed budget and the five-year income and cash flow projection.
The one-year budget which has a greater level of certainty and is used to set detailed budgetary targets at all levels
across the Group. It is also used by the Remuneration Committee to set targets for the annual incentive. The five-
year income and cash flow projection contains less certainty of outcome, but provides a robust planning tool against
which strategic decisions can be made. The Board also considered the five-year cash flow projection under various
scenarios, including the need to support financially loss making newly matured estates together with the projected
capital expenditure. On the basis of this and other matters considered and reviewed by the Board during the year,
the Board concluded and believe that the Group has adequate resources to continue operation and meet its liabilities
over the five years from 2016 to 2020. Accordingly, the Directors adopt the going concern basis of accounting in
preparing the financial statements.
Research and Development
The Group did not undertake any research and development activities. It relies on third parties to conduct research
and development of new diseases resistant and higher yield oil palm seeds.
Valuation
In 2015, the Group’s biological assets were valued by qualified valuers based on discounted cash flow. The
assumptions used in the discounted cash flow are described in greater detail in note 10.
Nine companies located across North Sumatera, Bengkulu, Riau, Kalimantan and Malaysia were valued by qualified
valuers in 2015 to provide indicative fair values and support the valuation for the estate lands. The Directors revalued
the estate land not covered by the valuation exercise based on the regional appreciation rate quantified by the
qualified valuers. Land is valued on a rotational basis and all land is valued by qualified valuers every two years.
Political donations
The Group made no political donations during the year.
Annual Report 2015 | Anglo-Eastern Plantations Plc
32
32
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Report
Directors’ Report
Directors’ Report
Directors’ Report
Directors’ Report
Directors’ Report
Carbon Reporting
Carbon Reporting
Carbon Reporting
Carbon Reporting
Carbon Reporting
A greenhouse gas (“GHG”) emissions assessment quantifies greenhouse gases produced directly and indirectly
A greenhouse gas (“GHG”) emissions assessment quantifies greenhouse gases produced directly and indirectly
A greenhouse gas (“GHG”) emissions assessment quantifies greenhouse gases produced directly and indirectly
Carbon Reporting
A greenhouse gas (“GHG”) emissions assessment quantifies greenhouse gases produced directly and indirectly
A greenhouse gas (“GHG”) emissions assessment quantifies greenhouse gases produced directly and indirectly
from the Group’s agricultural activities. Also known as a carbon footprint, it is essential tool in the process of
from the Group’s agricultural activities. Also known as a carbon footprint, it is essential tool in the process of
from the Group’s agricultural activities. Also known as a carbon footprint, it is essential tool in the process of
A greenhouse gas (“GHG”) emissions assessment quantifies greenhouse gases produced directly and indirectly
from the Group’s agricultural activities. Also known as a carbon footprint, it is essential tool in the process of
from the Group’s agricultural activities. Also known as a carbon footprint, it is essential tool in the process of
understanding, monitoring, managing and reducing the Group’s climate change impact. The emissions sources
understanding, monitoring, managing and reducing the Group’s climate change impact. The emissions sources
understanding, monitoring, managing and reducing the Group’s climate change impact. The emissions sources
from the Group’s agricultural activities. Also known as a carbon footprint, it is essential tool in the process of
understanding, monitoring, managing and reducing the Group’s climate change impact. The emissions sources
understanding, monitoring, managing and reducing the Group’s climate change impact. The emissions sources
included in this report were fuel and electricity consumption at the mills, palm oil mill effluent (“POME”) treatment,
included in this report were fuel and electricity consumption at the mills, palm oil mill effluent (“POME”) treatment,
included in this report were fuel and electricity consumption at the mills, palm oil mill effluent (“POME”) treatment,
understanding, monitoring, managing and reducing the Group’s climate change impact. The emissions sources
included in this report were fuel and electricity consumption at the mills, palm oil mill effluent (“POME”) treatment,
included in this report were fuel and electricity consumption at the mills, palm oil mill effluent (“POME”) treatment,
nitrogen emissions from mineral fertiliser use, company owned vehicle use, third party vehicle fuel use, electricity
nitrogen emissions from mineral fertiliser use, company owned vehicle use, third party vehicle fuel use, electricity
nitrogen emissions from mineral fertiliser use, company owned vehicle use, third party vehicle fuel use, electricity
included in this report were fuel and electricity consumption at the mills, palm oil mill effluent (“POME”) treatment,
nitrogen emissions from mineral fertiliser use, company owned vehicle use, third party vehicle fuel use, electricity
nitrogen emissions from mineral fertiliser use, company owned vehicle use, third party vehicle fuel use, electricity
consumption in employee housing and emissions associated with land use change and carbon sequestration.
consumption in employee housing and emissions associated with land use change and carbon sequestration.
consumption in employee housing and emissions associated with land use change and carbon sequestration.
nitrogen emissions from mineral fertiliser use, company owned vehicle use, third party vehicle fuel use, electricity
consumption in employee housing and emissions associated with land use change and carbon sequestration.
consumption in employee housing and emissions associated with land use change and carbon sequestration.
consumption in employee housing and emissions associated with land use change and carbon sequestration.
The report identifies and quantifies GHG emissions in the production of CPO at the Group’s mills and related estate
The report identifies and quantifies GHG emissions in the production of CPO at the Group’s mills and related estate
The report identifies and quantifies GHG emissions in the production of CPO at the Group’s mills and related estate
The report identifies and quantifies GHG emissions in the production of CPO at the Group’s mills and related estate
The report identifies and quantifies GHG emissions in the production of CPO at the Group’s mills and related estate
supply base and planting activities. The Board believes that this report will help the Group plans and facilitate
supply base and planting activities. The Board believes that this report will help the Group plans and facilitate
supply base and planting activities. The Board believes that this report will help the Group plans and facilitate
The report identifies and quantifies GHG emissions in the production of CPO at the Group’s mills and related estate
supply base and planting activities. The Board believes that this report will help the Group plans and facilitate
supply base and planting activities. The Board believes that this report will help the Group plans and facilitate
designs and implementation of effective strategies for reducing the Group’s GHG emissions in future as well as
designs and implementation of effective strategies for reducing the Group’s GHG emissions in future as well as
designs and implementation of effective strategies for reducing the Group’s GHG emissions in future as well as
supply base and planting activities. The Board believes that this report will help the Group plans and facilitate
designs and implementation of effective strategies for reducing the Group’s GHG emissions in future as well as
designs and implementation of effective strategies for reducing the Group’s GHG emissions in future as well as
providing a benchmark to monitor reduction of similar gas. We understand the urgent need for the industry to identify
providing a benchmark to monitor reduction of similar gas. We understand the urgent need for the industry to identify
providing a benchmark to monitor reduction of similar gas. We understand the urgent need for the industry to identify
designs and implementation of effective strategies for reducing the Group’s GHG emissions in future as well as
providing a benchmark to monitor reduction of similar gas. We understand the urgent need for the industry to identify
providing a benchmark to monitor reduction of similar gas. We understand the urgent need for the industry to identify
and respond to reducing the environmental risk and impact by developing appropriate sustainable practices. We
and respond to reducing the environmental risk and impact by developing appropriate sustainable practices. We
and respond to reducing the environmental risk and impact by developing appropriate sustainable practices. We
providing a benchmark to monitor reduction of similar gas. We understand the urgent need for the industry to identify
and respond to reducing the environmental risk and impact by developing appropriate sustainable practices. We
and respond to reducing the environmental risk and impact by developing appropriate sustainable practices. We
remain committed to monitoring, targeting and reducing all our environmental impact across the Group.
remain committed to monitoring, targeting and reducing all our environmental impact across the Group.
remain committed to monitoring, targeting and reducing all our environmental impact across the Group.
and respond to reducing the environmental risk and impact by developing appropriate sustainable practices. We
remain committed to monitoring, targeting and reducing all our environmental impact across the Group.
remain committed to monitoring, targeting and reducing all our environmental impact across the Group.
remain committed to monitoring, targeting and reducing all our environmental impact across the Group.
This assessment has been carried out in accordance with the World Business Council for Sustainable Development
This assessment has been carried out in accordance with the World Business Council for Sustainable Development
This assessment has been carried out in accordance with the World Business Council for Sustainable Development
This assessment has been carried out in accordance with the World Business Council for Sustainable Development
This assessment has been carried out in accordance with the World Business Council for Sustainable Development
and World Resources Institute’s (WBCSD/WRI) Greenhouse Gas Protocol; a Corporate Accounting and Reporting
and World Resources Institute’s (WBCSD/WRI) Greenhouse Gas Protocol; a Corporate Accounting and Reporting
and World Resources Institute’s (WBCSD/WRI) Greenhouse Gas Protocol; a Corporate Accounting and Reporting
This assessment has been carried out in accordance with the World Business Council for Sustainable Development
and World Resources Institute’s (WBCSD/WRI) Greenhouse Gas Protocol; a Corporate Accounting and Reporting
and World Resources Institute’s (WBCSD/WRI) Greenhouse Gas Protocol; a Corporate Accounting and Reporting
Standard, together with the latest emission factors from recognised public sources including, but not limited to, Defra,
Standard, together with the latest emission factors from recognised public sources including, but not limited to, Defra,
Standard, together with the latest emission factors from recognised public sources including, but not limited to, Defra,
and World Resources Institute’s (WBCSD/WRI) Greenhouse Gas Protocol; a Corporate Accounting and Reporting
Standard, together with the latest emission factors from recognised public sources including, but not limited to, Defra,
Standard, together with the latest emission factors from recognised public sources including, but not limited to, Defra,
the International Energy Agency, the US Energy Information Association, the US Environmental Protection Agency
the International Energy Agency, the US Energy Information Association, the US Environmental Protection Agency
the International Energy Agency, the US Energy Information Association, the US Environmental Protection Agency
Standard, together with the latest emission factors from recognised public sources including, but not limited to, Defra,
the International Energy Agency, the US Energy Information Association, the US Environmental Protection Agency
the International Energy Agency, the US Energy Information Association, the US Environmental Protection Agency
and the Intergovernmental panel on Climate Change. The values for the amount of carbon sequestered by the oil
and the Intergovernmental panel on Climate Change. The values for the amount of carbon sequestered by the oil
and the Intergovernmental panel on Climate Change. The values for the amount of carbon sequestered by the oil
the International Energy Agency, the US Energy Information Association, the US Environmental Protection Agency
and the Intergovernmental panel on Climate Change. The values for the amount of carbon sequestered by the oil
and the Intergovernmental panel on Climate Change. The values for the amount of carbon sequestered by the oil
palm have been taken from the OPRODSIM and OPCABSIM average growth models provided in the PalmGHG
palm have been taken from the OPRODSIM and OPCABSIM average growth models provided in the PalmGHG
palm have been taken from the OPRODSIM and OPCABSIM average growth models provided in the PalmGHG
and the Intergovernmental panel on Climate Change. The values for the amount of carbon sequestered by the oil
palm have been taken from the OPRODSIM and OPCABSIM average growth models provided in the PalmGHG
palm have been taken from the OPRODSIM and OPCABSIM average growth models provided in the PalmGHG
Tool. GHG emissions have been reported by the three WBCSD/WRI scopes. Land use emissions and carbon
Tool. GHG emissions have been reported by the three WBCSD/WRI scopes. Land use emissions and carbon
Tool. GHG emissions have been reported by the three WBCSD/WRI scopes. Land use emissions and carbon
palm have been taken from the OPRODSIM and OPCABSIM average growth models provided in the PalmGHG
Tool. GHG emissions have been reported by the three WBCSD/WRI scopes. Land use emissions and carbon
Tool. GHG emissions have been reported by the three WBCSD/WRI scopes. Land use emissions and carbon
sequestration results were calculated in line with the methodology used by The Roundtable for Sustainable Palm Oil
sequestration results were calculated in line with the methodology used by The Roundtable for Sustainable Palm Oil
sequestration results were calculated in line with the methodology used by The Roundtable for Sustainable Palm Oil
Tool. GHG emissions have been reported by the three WBCSD/WRI scopes. Land use emissions and carbon
sequestration results were calculated in line with the methodology used by The Roundtable for Sustainable Palm Oil
sequestration results were calculated in line with the methodology used by The Roundtable for Sustainable Palm Oil
(“RSPO”) GHG Working Group 2 throughout the PalmGHG Calculator. The carbon stock values were derived by the
(“RSPO”) GHG Working Group 2 throughout the PalmGHG Calculator. The carbon stock values were derived by the
(“RSPO”) GHG Working Group 2 throughout the PalmGHG Calculator. The carbon stock values were derived by the
sequestration results were calculated in line with the methodology used by The Roundtable for Sustainable Palm Oil
(“RSPO”) GHG Working Group 2 throughout the PalmGHG Calculator. The carbon stock values were derived by the
(“RSPO”) GHG Working Group 2 throughout the PalmGHG Calculator. The carbon stock values were derived by the
RSPO based on a review of relevant literature and satellite images for land use changes associated with oil palm
RSPO based on a review of relevant literature and satellite images for land use changes associated with oil palm
RSPO based on a review of relevant literature and satellite images for land use changes associated with oil palm
(“RSPO”) GHG Working Group 2 throughout the PalmGHG Calculator. The carbon stock values were derived by the
RSPO based on a review of relevant literature and satellite images for land use changes associated with oil palm
RSPO based on a review of relevant literature and satellite images for land use changes associated with oil palm
plantations in Indonesia and Malaysia. An estimate of CO2 emissions from cultivation of peat soils has been included
plantations in Indonesia and Malaysia. An estimate of CO2 emissions from cultivation of peat soils has been included
plantations in Indonesia and Malaysia. An estimate of CO2 emissions from cultivation of peat soils has been included
RSPO based on a review of relevant literature and satellite images for land use changes associated with oil palm
plantations in Indonesia and Malaysia. An estimate of CO2 emissions from cultivation of peat soils has been included
plantations in Indonesia and Malaysia. An estimate of CO2 emissions from cultivation of peat soils has been included
in this report. The detailed methodology in calculation the GHG emissions under the three scopes can be viewed at
in this report. The detailed methodology in calculation the GHG emissions under the three scopes can be viewed at
in this report. The detailed methodology in calculation the GHG emissions under the three scopes can be viewed at
plantations in Indonesia and Malaysia. An estimate of CO2 emissions from cultivation of peat soils has been included
in this report. The detailed methodology in calculation the GHG emissions under the three scopes can be viewed at
in this report. The detailed methodology in calculation the GHG emissions under the three scopes can be viewed at
www.ghgprotocol.org.
www.ghgprotocol.org.
www.ghgprotocol.org.
in this report. The detailed methodology in calculation the GHG emissions under the three scopes can be viewed at
www.ghgprotocol.org.
www.ghgprotocol.org.
www.ghgprotocol.org.
The gross overall emissions computed by the outsourced agent were 1,477,208 tCO2e for 2015 compared to
The gross overall emissions computed by the outsourced agent were 1,477,208 tCO2e for 2015 compared to
The gross overall emissions computed by the outsourced agent were 1,477,208 tCO2e for 2015 compared to
The gross overall emissions computed by the outsourced agent were 1,477,208 tCO2e for 2015 compared to
The gross overall emissions computed by the outsourced agent were 1,477,208 tCO2e for 2015 compared to
1,291,241 tCO2e for 2014.
1,291,241 tCO2e for 2014.
1,291,241 tCO2e for 2014.
The gross overall emissions computed by the outsourced agent were 1,477,208 tCO2e for 2015 compared to
1,291,241 tCO2e for 2014.
1,291,241 tCO2e for 2014.
1,291,241 tCO2e for 2014.
The overall emissions have increased by 185,967 tCO2e, or 14%, from 1,291,241 tCO2e during the 2014 to 2015
The overall emissions have increased by 185,967 tCO2e, or 14%, from 1,291,241 tCO2e during the 2014 to 2015
The overall emissions have increased by 185,967 tCO2e, or 14%, from 1,291,241 tCO2e during the 2014 to 2015
The overall emissions have increased by 185,967 tCO2e, or 14%, from 1,291,241 tCO2e during the 2014 to 2015
The overall emissions have increased by 185,967 tCO2e, or 14%, from 1,291,241 tCO2e during the 2014 to 2015
assessment period. This increase was mainly due to an increase in emissions associated with land use, specifically
assessment period. This increase was mainly due to an increase in emissions associated with land use, specifically
assessment period. This increase was mainly due to an increase in emissions associated with land use, specifically
The overall emissions have increased by 185,967 tCO2e, or 14%, from 1,291,241 tCO2e during the 2014 to 2015
assessment period. This increase was mainly due to an increase in emissions associated with land use, specifically
assessment period. This increase was mainly due to an increase in emissions associated with land use, specifically
land clearance.
land clearance.
land clearance.
assessment period. This increase was mainly due to an increase in emissions associated with land use, specifically
land clearance.
land clearance.
land clearance.
Emissions source
Emissions source
Emissions source
Emissions source
Emissions source
POME treatment
POME treatment
Emissions source
POME treatment
POME treatment
POME treatment
Fertiliser application
Fertiliser application
POME treatment
Fertiliser application
Fertiliser application
Fertiliser application
Premises energy consumption
Premises energy consumption
Fertiliser application
Premises energy consumption
Premises energy consumption
Premises energy consumption
Company owned vehicles
Company owned vehicles
Premises energy consumption
Company owned vehicles
Company owned vehicles
Company owned vehicles
Third party vehicle use
Third party vehicle use
Company owned vehicles
Third party vehicle use
Third party vehicle use
Third party vehicle use
Employee housing
Employee housing
Third party vehicle use
Employee housing
Employee housing
Employee housing
Employee housing
2015 Emissions in tCO2e
2015 Emissions in tCO2e
2015 Emissions in tCO2e
2015 Emissions in tCO2e
2015 Emissions in tCO2e
2015 Emissions in tCO2e
2014 Emissions in tCO2e
2014 Emissions in tCO2e
2014 Emissions in tCO2e
2014 Emissions in tCO2e
2014 Emissions in tCO2e
2014 Emissions in tCO2e
249,327
249,327
249,327
249,327
249,327
25,202
25,202
249,327
25,202
25,202
25,202
13,513
13,513
25,202
13,513
13,513
13,513
5,828
5,828
13,513
5,828
5,828
5,828
8,121
8,121
5,828
8,121
8,121
8,121
1,123
1,123
8,121
1,123
1,123
1,123
303,114
303,114
1,123
303,114
303,114
303,114
Own crop Out-grower crop
Own crop Out-grower crop
303,114
Own crop Out-grower crop
Own crop Out-grower crop
Own crop Out-grower crop
722,408
722,408
Own crop Out-grower crop
722,408
722,408
722,408
-421,475
-421,475
722,408
-421,475
-421,475
-421,475
22,870
22,870
-421,475
22,870
22,870
22,870
1,174,094
1,174,094
22,870
1,174,094
1,174,094
1,174,094
1,477,208
1,477,208
1,174,094
1,477,208
1,477,208
1,477,208
1,477,208
889,867
889,867
889,867
889,867
889,867
-519,175
-519,175
889,867
-519,175
-519,175
-519,175
479,599
479,599
-519,175
479,599
479,599
479,599
479,599
260,325
260,325
260,325
260,325
260,325
20,530
20,530
260,325
20,530
20,530
20,530
13,163
13,163
20,530
13,163
13,163
13,163
5,827
5,827
13,163
5,827
5,827
5,827
7,104
7,104
5,827
7,104
7,104
7,104
2,570
2,570
7,104
2,570
2,570
2,570
309,519
309,519
2,570
309,519
309,519
309,519
Out-grower crop
Out-grower crop
309,519
Out-grower crop
Out-grower crop
Out-grower crop
620,094
620,094
Out-grower crop
620,094
620,094
620,094
-405,054
-405,054
620,094
-405,054
-405,054
-405,054
20,425
20,425
-405,054
20,425
20,425
20,425
981,722
981,722
20,425
981,722
981,722
981,722
1,291,241
1,291,241
981,722
1,291,241
1,291,241
1,291,241
1,291,241
Own crop
Own crop
Own crop
Own crop
Own crop
Own crop
749,023
749,023
749,023
749,023
749,023
-489,272
-489,272
749,023
-489,272
-489,272
-489,272
486,506
486,506
-489,272
486,506
486,506
486,506
486,506
Total operational emissions
Total operational emissions
Total operational emissions
Total operational emissions
Total operational emissions
Total operational emissions
Land clearance
Land clearance
Land clearance
Land clearance
Land clearance
Carbon sequestered by standing crop
Carbon sequestered by standing crop
Land clearance
Carbon sequestered by standing crop
Carbon sequestered by standing crop
Carbon sequestered by standing crop
Peat soils cultivation
Peat soils cultivation
Carbon sequestered by standing crop
Peat soils cultivation
Peat soils cultivation
Peat soils cultivation
Peat soils cultivation
Total land use emissions
Total land use emissions
Total land use emissions
Total land use emissions
Total land use emissions
Overall emissions
Overall emissions
Total land use emissions
Overall emissions
Overall emissions
Overall emissions
Overall emissions
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
33
33
33
33
33
33
33
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Report
Directors’ Report
Directors’ Report
Directors’ Report
2015 and 2014 emissions in tCO2e
2015 and 2014 emissions in tCO2e
2015 and 2014 emissions in tCO2e
2015 and 2014 emissions in tCO2e
Operational emissions (Exc. POME) combined
Operational emissions (Exc. POME) combined
Operational emissions (Exc. POME) combined
Operational emissions (Exc. POME) combined
2,000,000
2,000,000
2,000,000
2,000,000
1,500,000
1,500,000
1,500,000
1,500,000
1,000,000
1,000,000
1,000,000
1,000,000
500,000
500,000
500,000
500,000
e
e
e
e
2
2
2
2
O
O
O
O
C
C
C
C
t
t
t
t
0
0
0
0
-500,000
-500,000
-500,000
-500,000
-1,000,000
-1,000,000
-1,000,000
-1,000,000
POME treatment Operational
POME treatment Operational
POME treatment Operational
POME treatment Operational
emissions
emissions
emissions
emissions
Land clearance
Land clearance
Land clearance
Land clearance
Carbon
Carbon
Carbon
Carbon
sequestered by
sequestered by
sequestered by
sequestered by
standing crop
standing crop
standing crop
standing crop
Peat soils
Peat soils
Peat soils
Peat soils
cultivation
cultivation
cultivation
cultivation
2015
2015
2015
2015
2014
2014
2014
2014
The following chart display 2014 and 2015 overall emissions by scope.
The following chart display 2014 and 2015 overall emissions by scope.
The following chart display 2014 and 2015 overall emissions by scope.
The following chart display 2014 and 2015 overall emissions by scope.
Scope 1 are direct GHG emissions from sources owned and controlled by the Company which cover emissions
Scope 1 are direct GHG emissions from sources owned and controlled by the Company which cover emissions
Scope 1 are direct GHG emissions from sources owned and controlled by the Company which cover emissions
Scope 1 are direct GHG emissions from sources owned and controlled by the Company which cover emissions
associated with own crop land clearance, natural gas combustion and company owned vehicles. This made up
associated with own crop land clearance, natural gas combustion and company owned vehicles. This made up
associated with own crop land clearance, natural gas combustion and company owned vehicles. This made up
associated with own crop land clearance, natural gas combustion and company owned vehicles. This made up
majority of the GHG emissions. This has increased in 2015 due primarily to increase in land clearance emissions.
majority of the GHG emissions. This has increased in 2015 due primarily to increase in land clearance emissions.
majority of the GHG emissions. This has increased in 2015 due primarily to increase in land clearance emissions.
majority of the GHG emissions. This has increased in 2015 due primarily to increase in land clearance emissions.
Scope 2 accounts for GHG emissions of purchased electricity, heat and steam generated off-site. Scope 3 includes
Scope 2 accounts for GHG emissions of purchased electricity, heat and steam generated off-site. Scope 3 includes
Scope 2 accounts for GHG emissions of purchased electricity, heat and steam generated off-site. Scope 3 includes
Scope 2 accounts for GHG emissions of purchased electricity, heat and steam generated off-site. Scope 3 includes
all other indirect emissions such as out-grower crop, waste disposal, business travel and staff commuting. The
all other indirect emissions such as out-grower crop, waste disposal, business travel and staff commuting. The
all other indirect emissions such as out-grower crop, waste disposal, business travel and staff commuting. The
all other indirect emissions such as out-grower crop, waste disposal, business travel and staff commuting. The
increase in 2015 was associated with out-grower crop land clearance.
increase in 2015 was associated with out-grower crop land clearance.
increase in 2015 was associated with out-grower crop land clearance.
increase in 2015 was associated with out-grower crop land clearance.
2015 and 2014 Emissions in tCO2e by Scope
2015 and 2014 Emissions in tCO2e by Scope
2015 and 2014 Emissions in tCO2e by Scope
2015 and 2014 Emissions in tCO2e by Scope
e
e
e
e
2
2
2
2
O
O
O
O
C
C
C
C
t
t
t
t
1,200,000
1,200,000
1,200,000
1,200,000
1,000,000
1,000,000
1,000,000
1,000,000
800,000
800,000
800,000
800,000
600,000
600,000
600,000
600,000
400,000
400,000
400,000
400,000
200,000
200,000
200,000
200,000
0
0
0
0
Scope 1
Scope 1
Scope 1
Scope 1
Scope 2
Scope 2
Scope 2
Scope 2
Scope 3
Scope 3
Scope 3
Scope 3
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
2015
2015
2015
2015
2014
2014
2014
2014
34
34
34
34
34
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Report
Directors’ Report
Directors’ Report
Comparison of GHG emissions per production metrics:
Comparison of GHG emissions per production metrics:
Comparison of GHG emissions per production metrics:
Operational emissions reporting metric
Operational emissions reporting metric
Operational emissions reporting metric
2015 in tCO2e
2015 in tCO2e
2015 in tCO2e
2014 in tCO2e
2014 in tCO2e
2014 in tCO2e
GHG per tonne of CPO production
GHG per tonne of CPO production
GHG per tonne of CPO production
GHG per tonne of FFB production
GHG per tonne of FFB production
GHG per tonne of FFB production
GHG per tonne of FFB processed
GHG per tonne of FFB processed
GHG per tonne of FFB processed
GHG per hectare of planted area
GHG per hectare of planted area
GHG per hectare of planted area
0.95
0.95
0.95
0.34
0.34
0.34
0.20
0.20
0.20
4.72
4.72
4.72
1.05
1.05
1.05
0.36
0.36
0.36
0.22
0.22
0.22
5.02
5.02
5.02
2015 and 2014 emissions per reporting metric in tCO2e
2015 and 2014 emissions per reporting metric in tCO2e
2015 and 2014 emissions per reporting metric in tCO2e
t
t
t
i
i
i
n
n
n
u
u
u
r
r
r
e
e
e
p
p
p
e
e
e
2
2
2
O
O
O
C
C
C
t
t
t
6
6
6
5
5
5
4
4
4
3
3
3
2
2
2
1
1
1
0
0
0
2015
2015
2015
2014
2014
2014
per tonne of CPO
per tonne of CPO
per tonne of CPO
production
production
production
per tonne of FFB
per tonne of FFB
per tonne of FFB
production
production
production
per tonne of FFB
per tonne of FFB
per tonne of FFB
processed
processed
processed
per hectare of
per hectare of
per hectare of
planted area
planted area
planted area
Principal risks
Principal risks
Principal risks
Information on financial instruments risks is set out in note 23 to the consolidated financial statements and
Information on financial instruments risks is set out in note 23 to the consolidated financial statements and
Information on financial instruments risks is set out in note 23 to the consolidated financial statements and
information on other risks is set out in Strategic Report.
information on other risks is set out in Strategic Report.
information on other risks is set out in Strategic Report.
Biological assets, property, plant and equipment
Biological assets, property, plant and equipment
Biological assets, property, plant and equipment
Information relating to changes in fixed assets is given in note 10 to the consolidated financial statements.
Information relating to changes in fixed assets is given in note 10 to the consolidated financial statements.
Information relating to changes in fixed assets is given in note 10 to the consolidated financial statements.
Directors
Directors
Directors
Madam Lim Siew Kim, Dato’ John Lim Ewe Chuan, Mr. Lim Tian Huat and Mr. Jonathan Law Ngee Song will be
Madam Lim Siew Kim, Dato’ John Lim Ewe Chuan, Mr. Lim Tian Huat and Mr. Jonathan Law Ngee Song will be
Madam Lim Siew Kim, Dato’ John Lim Ewe Chuan, Mr. Lim Tian Huat and Mr. Jonathan Law Ngee Song will be
submitting themselves for re-appointment at the forthcoming annual general meeting.
submitting themselves for re-appointment at the forthcoming annual general meeting.
submitting themselves for re-appointment at the forthcoming annual general meeting.
Brief profiles of all Directors are set out on page 39 of this Annual Report.
Brief profiles of all Directors are set out on page 39 of this Annual Report.
Brief profiles of all Directors are set out on page 39 of this Annual Report.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
35
35
35
35
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Report
Substantial share interests
As at 31 March 2016 and 31 December 2015, 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
Number
Percentage of
voting rights held
Number
Percentage of
voting rights held
As at 31.3.2016
As at 31.12.2015
Genton International Limited
20,247,814
51.08% 20,247,814
Alcatel Bell Pension Fund
6,830,000
17.23%
6,830,000
KBC Securities
1,449,608
3.66%
1,485,113
51.08%
17.23%
3.75%
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. This accords 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 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 LLP has expressed its willingness to continue in office and a resolution to re-appoint them will be proposed as
Resolution 8 at the forthcoming annual general meeting.
Authority to allot shares
At the annual general meeting held on 29 June 2015 shareholders authorised the Board under the provisions of
section 551 of the Companies Act 2006 to allot relevant securities within specified limits for a period of five years.
Renewal of this authority is being sought under Resolution 10 at the forthcoming annual general meeting.
The aggregate nominal value which can be allotted under the authority set out in paragraph (i) of the resolution is
limited to £3,303,031 (representing 13,212,124 ordinary shares of 25p each) which is approximately one third of the
issued ordinary capital of the Company as at 29 April 2016 (being the latest practicable date before publication of
this notice). In accordance with guidance issued by The Investment Association, the authority in paragraph (ii) of the
resolution will authorise the Directors to allot shares, or to grant rights to subscribe for or convert any security into
shares, only in connection with a fully pre-emptive rights issue, up to a further nominal value of £3,303,031
(representing 13,212,124 ordinary shares). This amount (together with the authority provided under paragraph (a) of
the resolution) represents approximately two thirds of the Company’s issued ordinary share capital (excluding
treasury shares) as at 29 April 2016. This authority will expire at the conclusion of the next annual general meeting of
the Company. The Directors have no present intention of issuing new shares, or of granting rights to subscribe for or
to convert any security into shares.
Annual Report 2015 | Anglo-Eastern Plantations Plc
36
36
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Report
Directors’ Report
Disapplication of pre-emption rights
A fresh authority is also being sought under the provisions of sections 570 and 573 of the Companies Act 2006 to
Disapplication of pre-emption rights
enable the Board to make an issue to existing shareholders without being obliged to comply with certain technical
A fresh authority is also being sought under the provisions of sections 570 and 573 of the Companies Act 2006 to
requirements of the Companies Act, which create problems with regard to fractional entitlements and overseas
enable the Board to make an issue to existing shareholders without being obliged to comply with certain technical
shareholders. In addition, the authority will empower the Board to make issues of shares for cash to persons other
requirements of the Companies Act, which create problems with regard to fractional entitlements and overseas
than existing shareholders up to a maximum aggregate nominal amount of £495,454 representing 5% of the current
shareholders. In addition, the authority will empower the Board to make issues of shares for cash to persons other
issued share capital. The authority will be expiring at the forthcoming annual general meeting or on 30 June 2016,
than existing shareholders up to a maximum aggregate nominal amount of £495,454 representing 5% of the current
whichever is earlier. Renewal of this authority on similar terms is being sought under Resolution 11 at the
issued share capital. The authority will be expiring at the forthcoming annual general meeting or on 30 June 2016,
forthcoming annual general meeting.
whichever is earlier. Renewal of this authority on similar terms is being sought under Resolution 11 at the
forthcoming annual general meeting.
Acquisition of the Company’s own shares and authority to purchase own shares
At 29 April 2016, the Directors had remaining authority under the shareholders’ resolution of 29 June 2015, to make
Acquisition of the Company’s own shares and authority to purchase own shares
purchases of 3,963,637 of the Company’s ordinary shares. This authority expires on 30 June 2016. The Board will
At 29 April 2016, the Directors had remaining authority under the shareholders’ resolution of 29 June 2015, to make
only make purchases if they believe the earnings or net assets per share of the Company would be improved by
purchases of 3,963,637 of the Company’s ordinary shares. This authority expires on 30 June 2016. The Board will
such purchases. All such purchases will be market purchases made through the London Stock Exchange.
only make purchases if they believe the earnings or net assets per share of the Company would be improved by
Companies can hold their own shares which have been purchased in this way in treasury rather than having to
such purchases. All such purchases will be market purchases made through the London Stock Exchange.
cancel them. The Directors would, therefore, consider holding the Company’s own shares which have been
Companies can hold their own shares which have been purchased in this way in treasury rather than having to
purchased by the Company as treasury shares as this would give the Company the flexibility of being able to sell
cancel them. The Directors would, therefore, consider holding the Company’s own shares which have been
such shares quickly and effectively where it considers it in the interests of shareholders to do so. Whilst any such
purchased by the Company as treasury shares as this would give the Company the flexibility of being able to sell
shares are held in treasury, no dividends will be payable on them and they will not carry any voting rights.
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 12 to be proposed at the forthcoming annual general meeting seeks renewed authority to purchase up to
a maximum of 3,963,637 ordinary shares of 25p each on the London Stock Exchange, representing 10% of the
Resolution 12 to be proposed at the forthcoming annual general meeting seeks renewed authority to purchase up to
Company’s issued ordinary share capital. The minimum price which may be paid for an ordinary share is 25p. The
a maximum of 3,963,637 ordinary shares of 25p each on the London Stock Exchange, representing 10% of the
maximum price which may be paid for an ordinary share on any exercise of the authority will be restricted to the
Company’s issued ordinary share capital. The minimum price which may be paid for an ordinary share is 25p. The
highest of (i) an amount equal to 5% above the average middle market quotations for such shares as derived from
maximum price which may be paid for an ordinary share on any exercise of the authority will be restricted to the
the London Stock Exchange Daily Official List for the five business days before the purchase is made and (ii) the
highest of (i) an amount equal to 5% above the average middle market quotations for such shares as derived from
higher of price of the last independent trade and the highest current independent bid on the London Stock Exchange.
the London Stock Exchange Daily Official List for the five business days before the purchase is made and (ii) the
The maximum number of shares and the price range are stated for the purpose of compliance with statutory
higher of price of the last independent trade and the highest current independent bid on the London Stock Exchange.
requirements in seeking this authority and should not be taken as an indication of the level of purchases, or the
The maximum number of shares and the price range are stated for the purpose of compliance with statutory
prices thereof, that the Company would intend to make.
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.
Dividends
The Board is mindful that the Group’s development programme will require a considerable capital commitment. In
Dividends
this respect, the dividend level needs to be balanced against the planned capital expenditure in view of weaker CPO
The Board is mindful that the Group’s development programme will require a considerable capital commitment. In
prices. The Board is also mindful of shareholders’ sentiment and declared a final dividend of 1.75p in respect of 2015
this respect, the dividend level needs to be balanced against the planned capital expenditure in view of weaker CPO
(2014: 3.0p). Subject to shareholders approval of Resolution 3 at the AGM, the final dividend will be paid on 11 July
prices. The Board is also mindful of shareholders’ sentiment and declared a final dividend of 1.75p in respect of 2015
2016 to those shareholders on the register on 10 June 2016. Shareholders choosing to receive their dividend in US
(2014: 3.0p). Subject to shareholders approval of Resolution 3 at the AGM, the final dividend will be paid on 11 July
Dollar will do so at the rate ruling on 10 June 2016, when the register closes. Based on the exchange rate at 22 April
2016 to those shareholders on the register on 10 June 2016. Shareholders choosing to receive their dividend in US
2016 of $1.4409/£, the proposed dividend would be equivalent to 2.5cts, compared to 4.5cts declared in respect of
Dollar will do so at the rate ruling on 10 June 2016, when the register closes. Based on the exchange rate at 22 April
2014.
2016 of $1.4409/£, the proposed dividend would be equivalent to 2.5cts, compared to 4.5cts declared in respect of
2014.
Liability insurance for Company officers
As permitted by the Companies Act the Company has maintained insurance cover for the Directors against liabilities
Liability insurance for Company officers
in relation to the Company.
As permitted by the Companies Act the Company has maintained insurance cover for the Directors against liabilities
in relation to the Company.
On behalf of the Board
On behalf of the Board
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
26 April 2016
26 April 2016
37
37
37
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Responsibilities
Directors’ Responsibilities
The Directors are responsible for preparing the annual report and the financial statements in accordance with
applicable law and regulations.
The Directors are responsible for preparing the annual report and the financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the
Directors are required to prepare the Group financial statements in accordance with International Financial Reporting
Company law requires the Directors to prepare financial statements for each financial year. Under that law the
Standards (“IFRSs”) as adopted by the European Union and have elected to prepare the Company financial
Directors are required to prepare the Group financial statements in accordance with International Financial Reporting
statements in accordance with FRS 101 Reduced Disclosure Framework under the UK Generally Accepted
Standards (“IFRSs”) as adopted by the European Union and have elected to prepare the Company financial
Accounting Practice (UK GAAP). Under company law the Directors must not approve the financial statements unless
statements in accordance with FRS 101 Reduced Disclosure Framework under the UK Generally Accepted
they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit
Accounting Practice (UK GAAP). Under company law the Directors must not approve the financial statements unless
or loss for the Group for that period.
they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit
or loss for the Group for that period.
In preparing these financial statements, the Directors are required to:
select suitable accounting policies and then apply them consistently;
In preparing these financial statements, the Directors are required to:
make judgements and accounting estimates that are reasonable and prudent;
select suitable accounting policies and then apply them consistently;
state whether they have been prepared in accordance with IFRSs as adopted by the European Union, subject to
make judgements and accounting estimates that are reasonable and prudent;
any material departures disclosed and explained in the financial statements;
state whether they have been prepared in accordance with IFRSs as adopted by the European Union, subject to
prepare a Strategic Report, a Director’s Report and Director’s Remuneration report which comply with the
any material departures disclosed and explained in the financial statements;
requirements of the Companies Act 2006;
prepare a Strategic Report, a Director’s Report and Director’s Remuneration report which comply with the
make an assessment of the Company and Group’s ability to continue as a going concern.
requirements of the Companies Act 2006;
make an assessment of the Company and Group’s ability to continue as a going concern.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the
and enable them to ensure that the financial statements comply with the Companies Act 2006 and, as regards the
Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company
Group financial statements, Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of
and enable them to ensure that the financial statements comply with the Companies Act 2006 and, as regards the
the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Group financial statements, Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of
the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
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.
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.
Website publication
The Directors are responsible for ensuring the annual report and the financial statements are made available on a
Website publication
website. Financial statements are published on the Company’s website in accordance with legislation in the United
The Directors are responsible for ensuring the annual report and the financial statements are made available on a
Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in
website. Financial statements are published on the Company’s website in accordance with legislation in the United
other jurisdictions. The maintenance and integrity of the Company's website is the responsibility of the Directors.
Kingdom governing the preparation and dissemination of financial statements, which may vary from legislation in
The Directors' responsibility also extends to the ongoing integrity of the financial statements contained therein.
other jurisdictions. The maintenance and integrity of the Company's website is the responsibility of the Directors.
The Directors' responsibility also extends to the ongoing integrity of the financial statements contained therein.
Directors’ responsibilities pursuant to DTR4
All of the Directors listed on page 39 confirm to the best of their knowledge:
Directors’ responsibilities pursuant to DTR4
The Group financial statements have been prepared in accordance with IFRSs as adopted by the European
All of the Directors listed on page 39 confirm to the best of their knowledge:
Union and Article 4 of the IAS Regulation and give a true and fair view of the assets, liabilities, financial position
The Group financial statements have been prepared in accordance with IFRSs as adopted by the European
and profit and loss of the Group.
Union and Article 4 of the IAS Regulation and give a true and fair view of the assets, liabilities, financial position
The Strategic Report in annual report includes a fair review of the development and performance of the business
and profit and loss of the Group.
and the financial position of the Group and the parent Company, together with a description or the pr incipal risks
The Strategic Report in annual report includes a fair review of the development and performance of the business
and uncertainties that they face.
and the financial position of the Group and the parent Company, together with a description or the pr incipal risks
The annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide
and uncertainties that they face.
the information necessary for shareholders to assess the Company’s performance, business model and strategy.
The annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide
the information necessary for shareholders to assess the Company’s performance, business model and strategy.
On behalf of the Board
On behalf of the Board
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
26 April 2016
26 April 2016
38
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors
Madam Lim Siew Kim
(Non-Executive Chairman, age 67)
Non-Executive Director since 29 November 1993 and appointed as Non-Executive Chairman on 31 January 2011.
Dato’ John Lim Ewe Chuan
(Executive Director, Corporate Finance and Corporate Affairs, member of Nomination and Corporate Governance
Committee, Audit and Remuneration Committee, age 66)
Appointed 26 April 2008. On 1 September 2010 appointed as Executive Director. Prior to 1 September 2010, Dato’
John Lim was the Senior Independent Non-Executive Director.
Chartered Certified Accountant; partner with UHY Hacker Young LLP, London, since 1998; previously he had a
professional accounting career in Singapore and the UK.
Lim Tian Huat
(Senior Independent Non-Executive Director, Chairman of Audit Committee and Chairman of Nomination &
Corporate Governance Committee and member of Remuneration Committee, age 61)
Appointed 8 May 2015.
Fellow member of the Association of Chartered Certified Accountants and member of the Malaysian Institute of
Accountants and Malaysian Institute of Certified Public Accountants. He is the founding President of Insolvency
Practitioners Association of Malaysia. He holds a degree in Bachelor of Economics. Mr. Lim is a practising Chartered
Accountant with his own Corporate Restructuring and Insolvency practice Rodgers Reidy & Co. He is also the
Managing Director of Andersen Corporate Restructuring Sdn. Bhd. He was previously a partner in Ernst & Young
from 2002 to 2009 and prior to that, partner in Arthur Andersen & Co from 1990 to 2002. He co-authored a book
entitled “The Law and Practice of Corporate Receivership in Malaysia and Singapore”. Mr. Lim also served as
Commissioner to the United Nations Compensations Commission for a period of five years. He was also appointed
by the Domestic Trade Minister to be a member of the Corporate Law Reform Committee under the purview of the
Companies Commission of Malaysia.
Independent Non-Executive Director of Malaysia Building Society Berhad and UEM Sunrise Berhad, both of which
are listed on Bursa Malaysia.
Jonathan Law Ngee Song
(Independent Non-Executive Director, Chairman of Remuneration Committee, member of Audit Committee and
member of Nomination & Corporate Governance Committee, age 50)
Appointed 4 July 2013.
He was admitted as an Advocate and Solicitor, to the High Court of Malaya in 1991.
Following his graduation from Australia National University in 1989 with a Bachelor of Commerce and Bachelor of
Laws, he practised as a legal assistant in Allen & Gledhill (1991 to 1995) and was promoted to a partner (1995 to
1996). In 1996 he joined the Malaysian law firm Messrs Nik Saghir & Ismail as a partner of the firm.
Independent Non-Executive Director of Karex Berhad and Evergreen Fibreboard Berhad, public listed companies in
Malaysia. Appointed Independent Non-Executive Chairman of Evergreen Fibreboard Berhad on 22 February
2010. He is also the Chairman of Audit Committee and Remuneration Committee and a member of Nomination
Committee of Evergreen Fibreboard Berhad.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Statement on Corporate Governance
Application of the UK Corporate Governance Code
AEP is committed to business integrity, appropriately high ethical standards and professionalism in all its activities
and operations. This includes a commitment to high standards in corporate governance relating in particular to
appropriate systems and controls adopted at a senior level of management of the Group and operation of the Board.
The bench-mark standards in this regard are set out in the UK Corporate Governance Code (‘the Code’), as most
recently revised in October 2014 which forms part of the Listing Rules of the London Stock Exchange. The Code is
available from the Financial Reporting Council’s (“FRC”) website at www.frc.org.uk. Where provisions of the Code
were not met during 2015, particular comment is made in the statements below and in the Directors’ remuneration
report on pages 47 to 51.
UK Listing Rules
The UK Listing Rules require a premium listed issuer with a controlling shareholder to have in place a relationship
agreement with the controlling shareholder by 16 November 2014. The mandatory requirement for the relationship
agreement is intended to prevent controlling shareholders from exercising their influence in a way that is improper or
unfair to minority shareholders. The requirement is not intended to prevent a controlling shareholder from engaging
fairly with an issuer or legitimately disagreeing with the issuer and neither are they intended to prevent shareholders
from holding board positions. AEP Plc has identified all controlling shareholders and regarded its major shareholder,
Genton International Limited (“Genton”) as the only controlling shareholder. In this respect, the Company entered
into a relationship agreement with Genton on 14 November 2014. The agreement is available for inspection by the
shareholders upon request from the Company Secretary. AEP Plc has complied with the independence provisions
included in the agreement and that, so far as it is aware, those independence provisions have been complied with by
Genton.
The Board
AEP is led by a strong and experienced Board of Directors (see biographical details set out on page 39). During
2015 the Board comprised the Non-Executive Chairman, one Executive Director and two Non-Executive Directors,
both of whom are considered by the Board to be Independent.
Dato’ John Lim was appointed as Executive Director, Corporate Finance and Corporate Affairs on 1 September
2010. Prior to 1 September 2010, Dato’ John Lim was the Senior Independent Non-Executive Director.
Madam Lim Siew Kim was appointed as Non-Executive Chairman on 31 January 2011. Neither external search
consultancy nor open advertising was used for the appointment. The Nomination and Corporate Governance
Committee is of the view that Madam Lim, who owns 52% of the Company’s shares and was the Chairman of the
Company from 1993 to 1998, with her experience in plantation is an appropriate candidate for the position. 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-Executive Directors, there is a reasonable balance of influence.
In compliance with the Code, Madam Lim who has been a Non-Executive Director for more than 9 years will submit
herself for re-election every year.
Independence of the Non-Executive Directors
The Board has evaluated the independence of each of its Non-Executive Directors. Following this assessment, the
Board has determined that, throughout the reporting period, both of its Independent Non-Executive Directors, who
were appointed for specified terms of office, were independent, base above all on their objectivity and integrity. The
terms and conditions relating to the appointment of the Non-Executive Directors are available from the Company
Secretary.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Statement on Corporate Governance
In arriving at its conclusion, the Board considered the factors set out in the Combined Code includ ing, inter alia,
whether any of the Non-Executive Directors:
• has been an employee of the Group within the last five years;
• has, or had within the last three years, a material business relationship with the Group;
•
• has close family ties with any of the Group’s advisors, Directors or senior employees;
• holds cross-directorships or has significant links with other Directors through involvement in other companies or
receives remuneration from the Group other than a Director’s fee;
bodies;
• has served more than nine years on the Board; or
•
represents a significant shareholder
The Combined Code acknowledges that a Director may be regarded as independent notwithstanding the existence
of any of the above factors.
The 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.
Senior Independent Non-Executive Director
Mr. Lim Tian Huat, an experienced Chartered Accountant acted in the capacity of Senior Independent Non-Executive
Director from 8 May 2015 following the resignation of Mr. Nik Din Bin Nik Sulaiman.
Operation of the Board
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 which
are available for inspection upon request from the Company Secretary.
Unless warranted by unusual matters, the Board normally meets two to three times each year. Otherwise all other
matters are dealt with by written resolution and telephone conference. During 2015, there were two Board meetings,
attended by all the Directors. Agenda and minutes of previous meetings were circulated prior to meetings.
The Independent Non-Executive Directors met on their own during 2015. Telephone discussions between the
Chairman and Non-Executive Directors also took place outside these meetings.
The Board is supplied with relevant, timely and accurate information for review prior to each meeting to enable them
to discharge their duties. The Audit Committee is responsible for the integrity of the financial information and this is
achieved by interacting with the management and with the internal auditors. The Board has identified and formally
adopted a schedule of key matters that are reserved for its decision, including the annual fiscal and capital budgets,
interim, preliminary and final results announcements, final dividends, the appointment of Directors and the Company
Secretary, circulars to shareholders, Group treasury policies and acquisitions. Certain other matters are delegated to
Board committees, the details of which are set out below.
During 2015, the Board followed the Group results and the development of the activities of the various subsidiaries
by means of reports prepared by the management in Malaysia and Indonesia. It received further reports and minutes
of Executive Committee meetings in Indonesia chaired by a senior manager from Malaysia. The objectives of the
Executive Committee is to resolve operational issues and to drive the performance budget set at the beginning of
every year by the Board. The other members of the Executive Committee are made up of senior members of the
management team based in Indonesia which amongst others includes the Chief Executive Officer, the Chief
Operating Officers, and the Finance Director.
The Board also discussed at length the various options available to the Group to maximise the return on its surplus
cash. The Board during the year sought the recommendation from professionals on treasury functions.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Statement on Corporate Governance
Each Board member has access to the impartial advice and services of the Company Secretary, who is responsible
to the Board for ensuring that appropriate procedures are followed. Where necessary the Board members may seek
independent advice including legal counsel at the Company’s expense. The Company maintained Directors’ and
officers’ liability insurance throughout 2015.
Non-Executive Directors are appointed for two year terms renewable on recommendation of the Board. 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 yearly re-election under the Code.
Dato’ John Lim, the only Executive Director on Board sits on the Audit, Remuneration and Nomination Committees
for 2015. The UK Corporate Governance Code 2014 provides for smaller companies like AEP to have two
independent Non-Executive Directors in the Audit and Remuneration Committees and a majority independent Non-
Executive Directors in the Nomination Committee. The Code does not expressly provide for the exclusion of the
Executive Director in the Audit and Remuneration Committees. In practice companies would normally exclude the
Executive Director from membership so as not to taint the independence of both the Audit and Remuneration
Committees. However the Board felt strongly that given the small composition of the various Committees, they would
benefit from Dato’ John Lim’s wealth of commercial and audit experience. It was also felt that Dato’ John Lim being
the only Director based in London could only adequately represent the Company in any sh areholders and investor
meetings if he sits in the three Committees. The Board also believes that the Non-Executive Directors, being
professionals in their own areas of expertise would maintain their impartiality and independence by their majority
presence in all three Committees.
In 2015 the Board conducted a review of its performance by discussion. It concluded that the Board is performing
effectively and that the Board members have the complementary skills appropriate to propel the Group in its strategic
direction and for challenges ahead. No other major issues arose from this review.
Following a review of the internal control and risks management in March 2016 and in the absence of any reported
failing and weaknesses which the Board considered significant, it concluded that these remain effective and
sufficient for their purpose.
Nomination Committee
The Nomination and Corporate Governance Committee currently comprises Mr. Lim Tian Huat (Chairman), Dato’
John Lim and Mr. Jonathan Law Ngee Song. The committee had three meetings during 2015, attended by all
members.
The policy on gender diversity is described in page 26 of the Strategic Report.
During the year, the Nomination Committee reviewed and deliberated on the Statement of Corporate Governance for
inclusion in the Annual Report. It also met to discuss and approve the extension of contracts of two Directors. During
the year it also recommended the recruitment of a Finance Director to replace the outgoing in the Indonesian
operations. The Nomination Committee also reviewed, deliberated and recommended the appointment of Mr. Lim
Tian Huat to join the Board on 8 May 2015 to replace Mr. Nik Din Bin Nik Sulaiman who resigned.
Relations with shareholders
The Executive Director contacted and met certain principal shareholders during the year to understand their
concerns and at all times are pleased to speak to and meet any shareholder. The views of the shareholders were
communicated to the Board to ensure that it is mindful of the shareholders’ sentiment and issues arising at all times.
Given the dispersion of Directors and shareholders it is not possible for every Director to meet shareholders in the
presence of management. A member of the Audit, Nomination and Remuneration Committees will be available at the
2016 AGM. It is the intention of the Board that the Company would engage with identifiable shareholders who have
voted against Company’s resolutions in the past.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Statement on Corporate Governance
The annual report, interim report and interim management statements are intended to keep the shareholders
informed as to the progress in the operational and financial performance of the Group. The Company maintains a
corporate website at http://www.angloeastern.co.uk. This website has detailed information on various aspects of the
Group’s operations. The website is updated regularly and includes information on the Company’s share price and the
price of crude palm oil.
The Company’s results and other news releases issued via the London Stock Exchange’s Regulatory News Service
are published on the “Investors” and “News” sections of the website and together with other relevant documentation
concerning the Company, are available for downloading.
Environmental and corporate responsibility
In 2004 a group of growers, processors, retailers and wildlife and conservation groups founded the “Roundtable for
Sustainable Palm Oil”, known as RSPO, to codify and promote best practices in the industry. Although AEP is not a
member of the RSPO, 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 RSPO. Many of these principles overlap with
ISPO of which compliance is mandatory for AEP. 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 replanting
• 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.
AEP seeks to comply with these principles in all areas of its activities.
Lim Tian Huat
Chairman, Nomination and Corporate Governance Committee 26 April 2016
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Audit Committee Report
Audit Committee
The Audit Committee comprises Mr. Lim Tian Huat (Chairman), Dato’ John Lim and Mr. Jonathan Law Ngee Song,
all of whom are considered by the Directors to have relevant financial and professional experiences to discharge
their specific duties with respect to the Audit Committee.
Mr. Lim Tian Huat is a Fellow member of the Association of Chartered Certified Accountants and a member of the
Malaysian Institute of Accountants and Malaysian Institute of Certified Public Accountants. He is also the founding
President of Insolvency Practitioners of Malaysia. He has extensive experience in accounting, auditing, finance and
corporate insolvency. He attended five seminars in 2015, some of them were organised by Malaysian Institute of
Accountants and Institute of Internal Auditors of Malaysia. The seminars covered topics such as governance, risks
and controls and stewardship of boards with regards to audit strategy, risks, talents, culture and leadership.
Dato’ John Lim attended webinars hosted by UHY on update of accounting and auditing standards.
Jonathan Law attended three seminars covering topics on business of innovation, how to maximise Internal Audits
and Board rewards and recognition organised by the Malaysia Stock Exchange and Malaysian Directors Academy in
2015.
During the year, all members of the Audit Committee attended a conference call jointly organised by the Company
Sponsor and Company Solicitors from London to update members on the Insider Trading and London Stock
Exchange Rules. A copy of the presentation paper on Understanding Application of the Model Code was circulated
before the meeting. Follow-up conference calls with the Sponsor and Company Solicitor were organised to
implement the Model Code in the Company.
Overview
The Audit Committee met prior to the completion of the 2015 accounts and five times during 2015 with full
attendance.
During the year, the Committee reviewed the 2014 Annual Report, Interim Results, 1 st Quarter and 3rd Quarter
Interim Management Statement for 2015, dividend rate, risks management and the internal audit reports. It also
approved the Internal Audit Plan for the year.
The Committee met with the external auditors twice in 2015 to discuss the audit findings as well as the planning for
the 2015 audit.
In preparing the financial statements, the Directors have made a number of subjective judgements around significant
accounting estimates which involved making assumptions regarding uncertain future events. The Committee
reviewed the relevance of key assumptions used in the determination of biological assets. As the current CPO price
and forecast CPO prices are much lower than the average over the past 10 years, a benchmarking exercise was
made to ensure the directors’ best estimate of the price sustainable over the longer term is being used. The Directors
adopted the recommendation of the valuer who has suggested applying a ratio of 70% of the current CPO price and
30% of the historical price (10-year average) given the assumption to calculate CPO price over the past 10 years is
no longer considered to be appropriate. As a result, the directors adopted the CPO price of $625/mt which falls within
the valuer’s recommended range of $600/mt to $650/mt and the World Bank forecast of CPO price for 2016 at
$600/mt. All other key assumptions are significantly unchanged other than the discount rate which was increased to
16.8% from 16.4% to reflect the increase in sovereign risks in Indonesia.
To provide indicative fair values and support valuation for the estate lands, nine companies located across North
Sumatera, Bengkulu, Riau, Kalimantan and Malaysia were valued by qualified valuers in 2015. The Directors
revalued the estate land not covered by the valuation exercise based on the regional appreciation rate quantified by
the qualified valuers. Land is valued on a rotational basis and all land is valued by qualified valuers every two years.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Audit Committee Report
The Committee also reviewed the policy on revenue recognition and believe that revenue is recognized when
significant risks and rewards of ownership of the FFB and CPO have been transferred to the buyers have been
observed. The Group generates revenue predominantly from the sale of CPO from processed FFB.
The Audit Committee also reviewed the internal audit reports and the Committee met with the Internal Auditor on one
occasion to discuss the audit findings. No major fraud and theft were discovered. Most of the weaknesses were
operational in nature and based on our discussions suggested improvement in internal controls were satisfactorily
implemented.
The Committee was apprised by the Executive Director on the on-going discussion amongst UK plantation
companies on the adoption of new amendments to IAS 16 and IAS 41 for bearer plants mandatory from 1 January
2016. The standards require bearer plants to be treated as property, plant and equipment to be valued at historical
costs less depreciation or deemed costs at last valuation. The directors have quantified the impact that would have
on the Group net assets with the adoption of the amended IAS 16 and IAS 41 which is disclosed in note 1 to the
financial statements on page 65. FFB not due for harvest is currently measured as part of the BA valuation.
The Board receives reports from executive management in Indonesia and Malaysia and focuses principally on
reviewing reports from management and considers whether significant risks in the Group are identified, evaluated,
managed and whether significant weaknesses are promptly remedied including, but not limited to, commodity price
movements, exchange rate movements, political and social change and government legislation.
A member of the Audit Committee also met up with the senior management during the year to discuss various
financial and operational issues. There is a regular dialogue, both formal and informal between the Audit Committee
and the senior management and communication is open and constructive.
During the year the Committee carried out an assessment of the effectiveness of the external audit process. The
assessment was led by the Chairman of the Audit Committee, assisted by the Senior General Manager and the
Group Accountant and focused on certain criteria which the Committee considered to be important factors in
demonstrating an effective audit process. These factors included the quality of audit staff, the planning and execution
of the audit according to agreed plans and timeline, provision of sound advice on technical issues and degree of
independence and professionalism displayed during the audit. The current Audit Partner from BDO has been the
Company’s audit engagement partner since 2014. Following this assessment, the Committee concluded that the
external audit process remained effective, objectivity of the external auditors was not impaired and that it provides an
appropriate independent challenge of the senior management of the Group.
Responsibility
Audit Committee is responsible for:
Monitoring the integrity of the financial statements and reviewing formal announcements of financial
performance and significant reporting issues and judgements that such statements and announcements are
fair, and balanced;
Reviewing the effectiveness of the internal control functions (including the internal financial controls and the
internal audit function);
Making recommendations to the Board in relation to the appointment, reappointment and removal of the
external auditors, their remuneration and terms of engagement;
Reviewing and monitoring the independence of the external auditors and the effectiveness of the audit process;
Providing advice to the Board on the assessment of the principal risks facing the Group; and
Providing advice to the Board on the form and basis underlying the longer term viability statement and going
concern statement to be contained in Annual Reports.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Audit Committee Report
The Committee also monitors the engagement of the auditors to perform non-audit work. The Committee considered
that the nature and scope of, and remuneration payable in respect of, these engagements were such that the
independence and objectivity of the auditors was not impaired.
The members of the Committee discharge their responsibilities by informal discussions between them selves, by
meeting with the external auditors, the internal auditors and management and by consideration of reports by
management and by holding at least one formal meeting in each year.
Internal control
The Company has followed the Code provisions on internal control since 1999 and the Guidance on Risk
Management, Internal Control and Related Financial and Business Reporting issued by the Financial Reporting
Council in 2014. The Board has overall responsibility for the Group’s systems of internal control and risk
management and for reviewing its effectiveness. Such a system is designed to manage, rather than eliminate, the
risk of failure to achieve business objectives and can only provide reasonable and not absolute assurance against
material misstatement or loss. 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 Group has internal auditors who visit operating sites in Indonesia and Malaysia regularly based on approved
Internal Audit Plan and provide summarized internal audit reports to the Audit Committee on a regular basis. The
Internal Audit also conducts special audits throughout the year as and when required by management. The internal
audit team provides objective assurance as to the effectiveness of the Group’s systems of internal control and risk
management of the Group’s operating management to the Committee. Follow-up audits and discussions are also
held to ensure remedial actions are taken promptly. The internal audit 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.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Remuneration Report
I am pleased to report on the activities of the Remuneration Committee for the year ended 31 December 2015. It
sets out the remuneration policy and remuneration details for the Executive and Non-Executive directors of the
Group. It has been prepared in accordance with Schedule 8 of The Large and Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008 as amended in August 2013.
The Companies Act 2006 requires the auditors to report to the shareholders on certain parts of the Directors’
Remuneration Report and to state whether, in their opinion, those parts of the report have been properly prepared in
accordance with the Regulations. The parts of the annual report on remuneration that are subject to audit are
indicated in that report. Other sections of the Remuneration Report are not subject to audit.
The Executive Director’s compensation is not linked to the profitability of the Group. It is linked to his role in respect
of activities relating to corporate finance and corporate affairs, including liaising with the Company’s advisers and
regulators and interaction with shareholders.
The Executive Director basic salary remains and is capped at £90,000 per annum until August 2016.
The operating units in Indonesia and Malaysia however have in place variable compensation policy that rewards
senior executives and employees with bonuses ranging from 2 to 5 months’ pay based on individual’s and operating
units’ performance. The key criteria used in the determination of the variable compensation policy for bonus was
revised in May 2014 following discussion and consultation with the Company’s Chairman
The Remuneration policy detailed below took effect from 1 January 2015. The Remuneration policy and Director’s
remuneration report was last approved at Company’s AGM on 29 June 2015. In the meeting, the shareholders voted
in the following manner:
To approve Directors’ Remuneration Report
To approve Directors’ Remuneration Policy
% For
99.68%
99.17%
% Against
0.02%
0.82%
% Withheld/Abstain
0.30%
0.01%
The Committee would welcome your support for our Remuneration Report.
Remuneration Committee
The Remuneration Committee comprises of Mr. Jonathan Law Ngee Song (Chairman), Dato’ John Lim and Mr. Lim
Tian Huat.
The Committee had one meeting in 2015, attended by all members.
Besides formal meetings, it also has informal discussions and consultation with the Company’s Chairman in relation
to the variable bonuses for operational staff in Indonesia. During the year the Remuneration Committee reviewed the
annual increment and bonus entitlement of senior management in Indonesia and made the necessary
recommendation to the Board. The Committee also deliberated on the 2014 Remuneration Report and
recommended to the Board for acceptance.
Policy
The Remuneration Committee makes recommendations on senior management pay and conditions, after
consultation with the Chairman, and recommends to the Board the terms for the Executive Director. It periodically
assesses the remuneration of the Non-Executive Directors and submits proposal to the Board.
In determining the remuneration policy of senior management, the Committee takes into account the need to attract,
retain and motivate employees. It also makes external comparison with the current market trends and practices of
equivalent roles taking into account the size, business complexity and relative performance.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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47
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Remuneration Report
Non-Executive Directors’ remuneration is considered by the Board and consist exclusively of a fixed payment.
When determining Executive Director’s remuneration, the Committee reviews the pay policy and levels for
executives below the Board, as well as pay and conditions of employees throughout the Group. Other factors
considered are individual performance, market conditions, the Company’s performance, pay and employment
conditions of its other employees in the organisation and the need to maintain an economic operation. This policy
continues to be consistently applied.
Components
Base salary
Base salaries of senior management are reviewed on an annual basis by the Remuneration Committee or when an
individual changes his responsibilities. Non-Executive Directors receive no benefit other than a fee.
Bonus
The Group operates a bonus scheme for senior executives and managers of operating units, which is determined by
weighted performance criteria including crop production, external crop purchase, increased in planted area,
efficiency of mill performance and overall profitability. There is no bonus scheme for the Executive Director.
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 vest over 3 years. The total grant to each holder is determined by seniority and total market value at
date of grant is normally limited to 2 times base salary. Exercise of options is only permitted 3 years after grant,
provided that the holder remains an employee of the Group throughout the period. There are no other performance
criteria for exercise of options granted so far.
Pensions
The operating units in Indonesia participate in mandatory pension schemes for their local executives and
management. There is no company-sponsored scheme for senior executives outside of Indonesia.
Remuneration Policy Table For Executive Director
The table below summarises the key aspects of the Group’s Remuneration Policy for Executive Director effective 1
January 2016.
Type
Base salary - fixed pay
Purpose
To contain fixed costs
Maximum payment
Capped at £90,000.The cap is reviewed
periodically. The policy permits the cap to be
changed if this is deemed necessary to meet
business,
regulatory
requirements.
legislative
or
There is no bonus, fringe benefits or employee share option scheme for the Executive Director.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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48
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Remuneration Report
Directors’ Remuneration Report
Executive Director’s Remuneration Over 7 Years
Executive Director’s Remuneration Over 7 Years
Benefits
Benefits
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Year ended 31 Dec
Year ended 31 Dec
2015
2015
2014
2014
2013
2013
2012
2012
2011
2011
2010
2010
2009
2009
Salary
Salary
$137,000
$137,000
$133,000
$133,000
$117,000
$117,000
$105,000
$105,000
$83,000
$83,000
$114,000
$114,000
$137,000
$137,000
Pension
Pension
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Bonus
Bonus
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total
Total
$137,000
$137,000
$133,000
$133,000
$117,000
$117,000
$105,000
$105,000
$83,000
$83,000
$114,000
$114,000
$137.000
$137.000
Percentage change of remuneration
Percentage change of remuneration
The following table shows a comparison of percentage change in salaries of the Executive Director, senior
The following table shows a comparison of percentage change in salaries of the Executive Director, senior
management in Indonesia and total wages and salaries between 2014 and 2015.
management in Indonesia and total wages and salaries between 2014 and 2015.
2015
2015
Percentage change in Executive Director’s salary
Percentage change in Executive Director’s salary
Salary
Salary
$137,200
$137,200
2014
2014
Change
Change
$132,800
$132,800
+3.3%
+3.3%
Percentage change in selected Group senior management salaries
Percentage change in selected Group senior management salaries
Salaries
Salaries
$2,048,700
$2,048,700
$2,025,000
$2,025,000
+1.2%
+1.2%
Percentage change in total wages and salaries
Percentage change in total wages and salaries
Total wages and salaries
Total wages and salaries
$26,690,664
$26,690,664
$26,724,916
$26,724,916
-0.1%
-0.1%
Relative importance of spend on pay
Relative importance of spend on pay
30,000
30,000
25,000
25,000
20,000
20,000
$'000
$'000
15,000
15,000
10,000
10,000
5,000
5,000
-
-
28,316 27,859
28,316 27,859
1,998
1,998
1,869
1,869
2014
2014
2015
2015
2014
2014
2015
2015
Total Group Employee Remuneration
Total Group Employee Remuneration
Total Dividend Paid
Total Dividend Paid
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
49
49
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Remuneration Report
Service contracts
All Directors, Executive and Non-Executive have formal appointment letters. The Executive and Non-Executives are
appointed normally on two year terms with notice periods of one month to two months. The service contracts are
kept at the registered office and may be inspected by shareholders on request. Notice periods for all other senior
management are generally two months. Therefore any remuneration payment for loss of office will be capped at a
maximum of two months.
At 31 December 2015, the unexpired term of the retiring Directors are:
Expiry 30 January 2017
Madam Lim Siew Kim
Expiry 31 August 2016
Dato’ John Lim Ewe Chuan
Mr. Lim Tian Huat
Expiry 7 May 2017
Mr. Jonathan Law Ngee Song Expiry 3 July 2017
Performance Graph
The performance graph is set out on page 4 and shows the Company’s share price performance compared to FTSE
100 index for the period of 2009 to 2015 (last 7 years) to indicate the volatility and trend of the market generally. Our
share price performance consistently outperformed the FTSE 100 index throughout these periods. In determining
senior management compensation, the Remuneration Committee is influenced by the operating performance of the
Company and not directly by the share price. There may be some positive impact on share price after AEP Plc has
been included by Morgan Stanley in the MSCI Global Micro Cap UK Indices with effect from 29 May 2015.
Directors’ interests (audited)
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:
Madam Lim Siew Kim
Dato' John Lim Ewe Chuan
Lim Tian Huat
Jonathan Law Ngee Song
2015
Ordinary shares
20,551,914
2014
Ordinary shares
20,551,914
-
-
-
-
-
-
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 betw een 31
December 2015 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. There is no
requirement for Directors to hold shares in the Company. Other than as set out in notes 6 and 20 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.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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50
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Directors’ Remuneration Report
Directors’ remuneration (audited)
The following part provides details of the remuneration of all the Directors for the year ended 31 December 2015. The
numerical components of these disclosures have been audited in accordance with Section 421 of the UK Companies
Act 2006.
The remuneration of all Directors who served during the year was:
Audited information
Name of Directors
Executive:
Dato' John Lim Ewe Chuan (1)
Non-Executive:
Lim Siew Kim (2)
Lim Tian Huat (3)
Nik Din Bin Nik Sulaiman (4)
Jonathan Law Ngee Song (5)
Total
Total 2015 Fees
Total 2014 Fees
$000
$000
137
56
15
9
23
240
133
61
-
27
27
248
Directors’ remuneration comprises of directors fees only.
Unaudited information
Notes:
(1) Appointed as Executive Director on 1 September 2010. Previously was the Senior Independent Non-Executive Director.
(2) Appointed on 29 November 1993 and appointed as Non-Executive Chairman on 31 January 2011.
(3) Appointed on 8 May 2015.
(4) Resigned on 8 May 2015.
(5) Appointed on 4 July 2013.
Jonathan Law Ngee Song
Chairman, Remuneration Committee 26 April 2016
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
We have audited the financial statements of Anglo-Eastern Plantations Plc for the year ended 31 December 2015
which comprise the consolidated income statement, the consolidated statement of comprehensive income, the
consolidated statement of financial position, the consolidated statement of changes in equity, the consolidated
statement of cash flows, the Company balance sheet, the Company statement of changes in equity and the related
notes. The financial reporting framework that has been applied in the preparation of the Group financial statements
is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union. The
financial reporting framework that has been applied in preparation of the Company financial statements is applicable
law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including
Financial Reporting Standard 101 (FRS 101) Reduced Disclosure Framework.
Opinion on financial statements
In our opinion:
the financial statements give a true and fair view of the state of the Group’s and of the Parent Company’s affairs
as at 31 December 2015 and of the Group’s loss for the year then ended;
the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the
European Union;
the Parent Company financial statements have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006;
and, as regards the Group financial statements, Article 4 of the IAS Regulation.
Purpose of report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members those
matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s
members as a body, for our audit work, for this report, or for the opinions we have formed.
Respective responsibilities of directors and auditors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of
the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and
express an opinion on the financial statements in accordance with applicable law and International Standards on
Auditing (UK and Ireland). Those standards require us to comply with the Financial Reporting Council’s Ethical
Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements is provided on the Financial Reporting Council’s
website at www.frc.org.uk/auditscopeukprivate.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
Auditors’ Report
Auditors’ Report
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
(continued)
(continued)
(continued)
(continued)
Our application of materiality
Our application of materiality
Our application of materiality
Our application of materiality
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of
misstatements. We consider materiality to be the magnitude by which misstatements, including omissions, could
misstatements. We consider materiality to be the magnitude by which misstatements, including omissions, could
misstatements. We consider materiality to be the magnitude by which misstatements, including omissions, could
misstatements. We consider materiality to be the magnitude by which misstatements, including omissions, could
influence the economic decisions of reasonable users that are taken on the basis of the financial statements. In order
influence the economic decisions of reasonable users that are taken on the basis of the financial statements. In order
influence the economic decisions of reasonable users that are taken on the basis of the financial statements. In order
influence the economic decisions of reasonable users that are taken on the basis of the financial statements. In order
to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a lower
to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a lower
to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a lower
to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a lower
materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements
materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements
materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements
materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements
below these levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified
below these levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified
below these levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified
below these levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified
misstatements and the particular circumstances of their occurrence, when evaluating their effect on the financial
misstatements and the particular circumstances of their occurrence, when evaluating their effect on the financial
misstatements and the particular circumstances of their occurrence, when evaluating their effect on the financial
misstatements and the particular circumstances of their occurrence, when evaluating their effect on the financial
statements as a whole.
statements as a whole.
statements as a whole.
statements as a whole.
We determined materiality for the financial statements as a whole to be US$2.00 million (2014: US$2.50 million),
We determined materiality for the financial statements as a whole to be US$2.00 million (2014: US$2.50 million),
We determined materiality for the financial statements as a whole to be US$2.00 million (2014: US$2.50 million),
We determined materiality for the financial statements as a whole to be US$2.00 million (2014: US$2.50 million),
which approximates to 1% of revenues (2014: 1%). We consider revenue to be a key indicator of the Group’s
which approximates to 1% of revenues (2014: 1%). We consider revenue to be a key indicator of the Group’s
which approximates to 1% of revenues (2014: 1%). We consider revenue to be a key indicator of the Group’s
which approximates to 1% of revenues (2014: 1%). We consider revenue to be a key indicator of the Group’s
financial performance and therefore an appropriate basis for materiality. We agreed with the Audit Committee that
financial performance and therefore an appropriate basis for materiality. We agreed with the Audit Committee that
financial performance and therefore an appropriate basis for materiality. We agreed with the Audit Committee that
financial performance and therefore an appropriate basis for materiality. We agreed with the Audit Committee that
we would report to the Committee all individual audit differences identified during the course of our audit in excess of
we would report to the Committee all individual audit differences identified during the course of our audit in excess of
we would report to the Committee all individual audit differences identified during the course of our audit in excess of
we would report to the Committee all individual audit differences identified during the course of our audit in excess of
US$50,000 (2014: US$50,000). We also agreed to report differences below this threshold that, in our view,
US$50,000 (2014: US$50,000). We also agreed to report differences below this threshold that, in our view,
US$50,000 (2014: US$50,000). We also agreed to report differences below this threshold that, in our view,
US$50,000 (2014: US$50,000). We also agreed to report differences below this threshold that, in our view,
warranted reporting on qualitative grounds.
warranted reporting on qualitative grounds.
warranted reporting on qualitative grounds.
warranted reporting on qualitative grounds.
An overview of the scope of our audit
An overview of the scope of our audit
An overview of the scope of our audit
An overview of the scope of our audit
Total assets
Total assets
Total assets
Total assets
(Loss)/profit before tax
(Loss)/profit before tax
(Loss)/profit before tax
(Loss)/profit before tax
Group level procedures on the audit of biological assets and land 60%
Group level procedures on the audit of biological assets and land 60%
Group level procedures on the audit of biological assets and land 60%
Group level procedures on the audit of biological assets and land 60%
(2014: 64%)
(2014: 64%)
(2014: 64%)
(2014: 64%)
Total assets of the five operating plantation companies significant by
Total assets of the five operating plantation companies significant by
Total assets of the five operating plantation companies significant by
Total assets of the five operating plantation companies significant by
size, excluding land and biological assets, subject to audit and review by
size, excluding land and biological assets, subject to audit and review by
size, excluding land and biological assets, subject to audit and review by
size, excluding land and biological assets, subject to audit and review by
Group auditors 32% (2014:30%)
Group auditors 32% (2014:30%)
Group auditors 32% (2014:30%)
Group auditors 32% (2014:30%)
Audit procedures performed by component auditors on specific areas
Audit procedures performed by component auditors on specific areas
Audit procedures performed by component auditors on specific areas
Audit procedures performed by component auditors on specific areas
subject to review by Group auditors 4% (2014: 4%)
subject to review by Group auditors 4% (2014: 4%)
subject to review by Group auditors 4% (2014: 4%)
subject to review by Group auditors 4% (2014: 4%)
Other 4% (2014:3%)
Other 4% (2014:3%)
Other 4% (2014:3%)
Other 4% (2014:3%)
Total profit before tax of the five operating plantation companies
Total profit before tax of the five operating plantation companies
Total profit before tax of the five operating plantation companies
Total profit before tax of the five operating plantation companies
significant by size, excluding the biological asset adjustment, subject to
significant by size, excluding the biological asset adjustment, subject to
significant by size, excluding the biological asset adjustment, subject to
significant by size, excluding the biological asset adjustment, subject to
audit and review by Group auditors $46,342m (2014: $71,149m)
audit and review by Group auditors $46,342m (2014: $71,149m)
audit and review by Group auditors $46,342m (2014: $71,149m)
audit and review by Group auditors $46,342m (2014: $71,149m)
Group level procedures on the biological asset adjustment loss of
Group level procedures on the biological asset adjustment loss of
Group level procedures on the biological asset adjustment loss of
Group level procedures on the biological asset adjustment loss of
$64,121m (2014: loss of $33,718)
$64,121m (2014: loss of $33,718)
$64,121m (2014: loss of $33,718)
$64,121m (2014: loss of $33,718)
Other loss of $1,295m (2014: loss of $19,913m)
Other loss of $1,295m (2014: loss of $19,913m)
Other loss of $1,295m (2014: loss of $19,913m)
Other loss of $1,295m (2014: loss of $19,913m)
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
(continued)
Revenue
Audit procedures performed by component auditors subject to audit and review by Group auditors covered 100% of
revenue (2014: 100%).
The Group financial statements are a consolidation of twenty six companies made up of the parent company, four
management companies, four dormant companies and seventeen trading companies operating fifteen mature
plantations and two immature plantations. Sixteen of the plantations are located in Indonesia and one in Malaysia.
The head office and main accounting location is located in Kuala Lumpur, Malaysia, at a separate location from the
plantations. Our Group audit scope focused on the group’s principal operating companies and based on our risk
assessment we identified five operating plantation companies which, in our view, required an audit of their complete
financial information due to their size and a further twelve which required audit procedures on specific areas due to
their risk characteristics. This, together with additional procedures performed at Group level, which included the audit
of biological assets and leasehold land, gave us the evidence we needed to form our opinion on the Group financial
statements as a whole.
Audits of the subsidiary companies were performed at materiality levels which were lower than Group materiality and
determined by us to be appropriate to the relative size of the company concerned. The audits of each of the
operating companies were performed entirely in Malaysia and Indonesia, as well as the audit of corporate accounting
function in Malaysia. All audits were conducted by BDO network firms with teams drawn from the UK, Malaysia and
Indonesia. As part of our audit strategy, the Senior Statutory Auditor and other senior members of the team between
them visit Malaysia and Indonesia each year. During these visits the Group audit team reviewed the full audit files for
the five operating plantation companies considered to be significant by size and the audit work in relation to the
specific areas identified due to risk for the other twelve. Following the review, any further work required by the Group
audit team was then performed by the component auditor. The component auditors visit the plantation estates on a
rotational basis so that the plantation estates are visited at least once every three years. The component auditors
visited sixteen out of the seventeen plantation estates in the current year.
The remaining components of the Group include non-significant holding companies and these components were
principally subject to analytical review procedures performed by the Group audit team.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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54
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
(continued)
Our assessment of risks of material misstatement
In preparing the financial statements, the Directors have made a number of subjective judgements around significant
accounting estimates which involved making assumptions regarding uncertain future events. The assessed risks of
material misstatement that had the greatest impact on the audit strategy, the allocation of resources in the audit and
directing the efforts of the engagement team and component auditors are described below. As there has been no
significant change in the Group’s operations these key risks are the same as in the prior year.
These risks were discussed with the Audit Committee and are included within their report on those matters they
considered to be significant issues in relation to the financial statements set out on pages 44 to 45.
Risk of material misstatement
Our response to the risks identified
Revenue recognition
Substantially all revenue is derived from the sales of
crude palm oil and palm kernel, the revenue from
which is recognised when the goods are delivered or
allocated to a purchaser subsequent to payment as
detailed in note 1. Revenue is calculated as the
quantity of crude palm oil multiplied by the crude palm
oil price, net of processing and transportation charges.
We consider there to be a risk over the accuracy of
the recorded weight of crude palm oil sales and
therefore the completeness of revenue.
Valuation of estate land
Estate land is carried at fair value, based on periodic
valuations on an open market basis by a
professionally qualified valuer. The directors obtain a
professional valuation on land on a rotational basis
and all land has been professionally valued at either
the current or previous financial year end. We
identified the valuation of estate land as a risk due to
the subjective judgements involved in the estimation
and the volatility of land market price within Indonesia.
We tested, on a sample basis, that sale invoices were
raised on the delivery date based on the goods
dispatched note and that the total weight stated in the
goods dispatched note agrees with that in the delivery
order. We also identified revenue from sales of crude
palm oil and palm kernel at the end of the current year
and the beginning of the new financial year and tested
a sample to ensure that revenue had been recognised
in the correct period.
the current year
the directors engaged an
In
independent valuer
to perform a market-based
valuation on all land that was not independently valued
in the prior year increasing the selection to ensure
geographical coverage of all areas in which they
operate. The directors performed their own valuation
on the rest of the land by considering the movements
on the valued land from last year and applying the
same movements to the rest of the land on a regional
basis. We assessed the capabilities, objectivity and
competence of the independent valuer and considered
the
to be satisfactory. We challenged
them
assumptions in the input data from the valuer and also
assessed the reasonableness of the movements in the
valuation of land on an estate by estate basis in light of
land area and market
movements
valuation trends. We challenged the assumptions used
by the Directors in their valuation, most notably on how
they applied the movements as determined by the
independent valuers to the other estates.
in plantation
Annual Report 2015 | Anglo-Eastern Plantations Plc
55
55
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
(continued)
(continued)
Risk of material misstatement
Risk of material misstatement
Valuation of biological assets
Valuation of biological assets
Biological assets are held at fair value less costs to sell
Biological assets are held at fair value less costs to sell
determined on the basis of the net present value of
determined on the basis of the net present value of
cash flows arising in the production of fresh fruit
cash flows arising in the production of fresh fruit
(FFB). Management exercise significant
bunches
(FFB). Management exercise significant
bunches
judgement in determining the underlying assumptions
judgement in determining the underlying assumptions
used in the calculation of fair value. These assumptions
used in the calculation of fair value. These assumptions
include the crude palm oil price (CPO), discount rate,
include the crude palm oil price (CPO), discount rate,
FFB production, estate yield, overhead cost and
FFB production, estate yield, overhead cost and
notional rent. We identified this as a risk due to the
notional rent. We identified this as a risk due to the
inherent uncertainty around the future estimates.
inherent uncertainty around the future estimates.
CPO price sensitivity
CPO price sensitivity
Our response to the risks identified
Our response to the risks identified
The directors engaged an independent valuer to
The directors engaged an independent valuer to
perform the valuation exercise. We assessed the
perform the valuation exercise. We assessed the
capabilities, objectivity and competence of
the
the
capabilities, objectivity and competence of
independent valuer and considered them to be
independent valuer and considered them to be
satisfactory. We also challenged the assumptions in
satisfactory. We also challenged the assumptions in
the input data made by management and the valuer
the input data made by management and the valuer
through discussions, comparisons to industry peers
through discussions, comparisons to industry peers
and independent external data sources and where
and independent external data sources and where
available
supporting
supporting
available
documentation and historical trends. Sensitivity of the
documentation and historical trends. Sensitivity of the
valuation to key assumptions is disclosed in note 10 of
valuation to key assumptions is disclosed in note 10 of
is most
the
is most
the
sensitive to the movement in CPO price as illustrated
sensitive to the movement in CPO price as illustrated
below.
below.
financial statements. The valuation
financial statements. The valuation
corroboration with
corroboration with
to
to
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
56
56
56
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
(continued)
Opinion on other matters prescribed by the Companies Act 2006
In our opinion:
the part of the directors’ remuneration report to be audited has been properly prepared in accordance with the
Companies Act 2006; and
the information given in the strategic report and the directors’ report for the financial year for which the financial
statements are prepared is consistent with the financial statements.
Statement regarding the directors’ assessment of principal risks, going concern and longer term viability of the
company
We have nothing material to add or to draw attention to in relation to:
the directors’ confirmation in the annual report that they have carried out a robust assessment of the principal
risks facing the entity, including those that would threaten its business model, future performance, solvency or
liquidity;
the disclosures in the annual report that describe those risks and explain how they are being managed or
mitigated;
the directors’ statement in the financial statements about whether they considered it appropriate to adopt the
going concern basis of accounting in preparing them and their identification of any material uncertainties to the
entity’s ability to continue to do so over a period of at least twelve months from the date of approval of the
financial statements; or
the directors’ explanation in the annual report as to how they have assessed the prospects of the entity, over
what period they have done so and why they consider that period to be appropriate, and their statement as to
whether they have a reasonable expectation that the entity will be able to continue in operation and meet its
liabilities as they fall due over the period of their assessment, including any related disclosures drawing attention
to any necessary qualifications or assumptions.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to
you if, in our opinion:
adequate accounting records have not been kept by the parent company, or returns adequate for our audit have
not been received from branches not visited by us; or
the Parent Company financial statements and the part of the directors’ remuneration report to be audited are not
in agreement with the accounting records and returns; or
we have not received all the information and explanations we require for our audit; or
certain disclosures of directors’ remuneration specified by law are not made.
Annual Report 2015 | Anglo-Eastern Plantations Plc
57
57
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Auditors’ Report
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF ANGLO-EASTERN PLANTATIONS PLC
(continued)
Our duty to read other information in the annual report
Under the Listing Rules we are required to review:
the directors’ statement, set out on page 13, in relation to going concern and on page 32, in relation to longer
term viability;
the part of the corporate governance statement relating to the Company’s compliance with the provisions of the
UK Corporate Governance Code specified for our review.
We have nothing to report arising from our review.
Under the ISAs (UK and Ireland), we are required to report to you if, in our opinion, information in the annual report
is:
materially inconsistent with the information in the audited financial statements; or
apparently materially incorrect based on, or materially inconsistent with, our knowledge of the Group acquire d in
the course of performing our audit; or
otherwise misleading.
In particular, we are required to consider whether we have identified any inconsistencies between our knowledge
acquired during the audit and the directors’ statement that they consider the annual report is fair, balanced and
understandable and whether the annual report appropriately discloses those matters that we communicated to the
Audit Committee which we consider should have been disclosed.
We confirm that we have not identified any such inconsistencies or misleading statements.
Anna Draper
Senior Statutory Auditor
For and on behalf of BDO LLP, Statutory Auditor
Chartered Accountants
London
United Kingdom
26 April 2016
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
Annual Report 2015 | Anglo-Eastern Plantations Plc
58
58
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Consolidated Income Statement
Consolidated Income Statement
For the year ended 31 December 2015
For the year ended 31 December 2015
Continuing operations
Continuing operations
Revenue
Revenue
Cost of sales
Cost of sales
Gross profit
Gross profit
Biological asset revaluation movement
Biological asset revaluation movement
Administration expenses
Administration expenses
Operating profit / (loss)
Operating profit / (loss)
Exchange (losses) / gains
Exchange (losses) / gains
Finance income
Finance income
Finance expense
Finance expense
Profit / (Loss) before tax
Profit / (Loss) before tax
Tax expense
Tax expense
Profit / (Loss) for the year
Profit / (Loss) for the year
Attributable to:
Attributable to:
- Owners of the parent
- Owners of the parent
- Non-controlling interests
- Non-controlling interests
Earnings per share for profit /
Earnings per share for profit /
(loss) attributable to the owners
(loss) attributable to the owners
of the parent during the year
of the parent during the year
- basic
- basic
- diluted
- diluted
Note
Note
2
2
3
3
3
3
4
4
7
7
8
8
8
8
Result
Result
before
before
BA
BA
adjustment
adjustment
$000
$000
251,258
251,258
(164,666)
(164,666)
86,592
86,592
-
-
(7,747)
(7,747)
78,845
78,845
852
852
7,276
7,276
(2,019)
(2,019)
84,954
84,954
(20,967)
(20,967)
63,987
63,987
2014
2014
BA
BA
adjustment
adjustment
$000
$000
-
-
-
-
-
-
(33,718)
(33,718)
-
-
(33,718)
(33,718)
-
-
-
-
-
-
(33,718)
(33,718)
8,429
8,429
(25,289)
(25,289)
52,422
52,422
11,565
11,565
63,987
63,987
(21,660)
(21,660)
(3,629)
(3,629)
(25,289)
(25,289)
Result
Result
before
before
BA
BA
adjustment
adjustment
$000
$000
196,451
196,451
(145,897)
(145,897)
50,554
50,554
-
-
(7,826)
(7,826)
42,728
42,728
(2,354)
(2,354)
6,683
6,683
(2,010)
(2,010)
45,047
45,047
(10,385)
(10,385)
34,662
34,662
2015
2015
BA
BA
adjustment
adjustment
$000
$000
-
-
-
-
-
-
(64,121)
(64,121)
-
-
(64,121)
(64,121)
-
-
-
-
-
-
(64,121)
(64,121)
16,030
16,030
(48,091)
(48,091)
27,505
27,505
7,157
7,157
34,662
34,662
(42,402)
(42,402)
(5,689)
(5,689)
(48,091)
(48,091)
Total
Total
$000
$000
196,451
196,451
(145,897)
(145,897)
50,554
50,554
(64,121)
(64,121)
(7,826)
(7,826)
(21,393)
(21,393)
(2,354)
(2,354)
6,683
6,683
(2,010)
(2,010)
(19,074)
(19,074)
5,645
5,645
(13,429)
(13,429)
(14,897)
(14,897)
1,468
1,468
(13,429)
(13,429)
(37.58)cts
(37.58)cts
(37.58)cts
(37.58)cts
Total
Total
$000
$000
251,258
251,258
(164,666)
(164,666)
86,592
86,592
(33,718)
(33,718)
(7,747)
(7,747)
45,127
45,127
852
852
7,276
7,276
(2,019)
(2,019)
51,236
51,236
(12,538)
(12,538)
38,698
38,698
30,762
30,762
7,936
7,936
38,698
38,698
77.61cts
77.61cts
77.53cts
77.53cts
Earnings per share before BA adjustment are shown in note 8.
Earnings per share before BA adjustment are shown in note 8.
The accompanying notes are an integral part of this consolidated income statement.
The accompanying notes are an integral part of this consolidated income statement.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
59
59
59
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2015
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2015
2015
$000
Profit / (Loss) for the year
Other comprehensive income / (expense):
Profit / (Loss) for the year
Items may be reclassified to profit or loss:
Other comprehensive income / (expense):
Loss on exchange translation of foreign operations
Items may be reclassified to profit or loss:
Net other comprehensive expense may be reclassified to profit or loss
Loss on exchange translation of foreign operations
Items not to be reclassified to profit or loss:
Net other comprehensive expense may be reclassified to profit or loss
Unrealised gain on revaluation of leasehold land
Items not to be reclassified to profit or loss:
Deferred tax on revaluation of leasehold land
Unrealised gain on revaluation of leasehold land
Remeasurement of retirement benefits plan
Deferred tax on revaluation of leasehold land
Deferred tax on retirement benefits
Remeasurement of retirement benefits plan
Net other comprehensive income / (expense) not being reclassified to profit or loss
Deferred tax on retirement benefits
Total other comprehensive expenses for the year, net of tax
Total comprehensive (expense) / income for the year
Net other comprehensive income / (expense) not being reclassified to profit or loss
Total other comprehensive expenses for the year, net of tax
Attributable to:
Total comprehensive (expense) / income for the year
- Owners of the parent
- Non-controlling interests
Attributable to:
- Owners of the parent
- Non-controlling interests
(13,429)
2015
$000
(13,429)
(54,595)
(54,595)
(54,595)
(54,595)
4,902
(1,226)
4,902
445
(1,226)
(111)
445
4,010
(111)
(50,585)
(64,014)
4,010
(50,585)
(64,014)
(56,016)
(7,998)
(64,014)
(56,016)
(7,998)
(64,014)
2014
$000
38,698
2014
$000
38,698
(12,019)
(12,019)
(12,019)
(12,019)
386
(96)
386
(680)
(96)
170
(680)
(220)
170
(12,239)
26,459
(220)
(12,239)
26,459
21,188
5,271
26,459
21,188
5,271
26,459
The accompanying notes are an integral part of this consolidated statement of comprehensive income and expense.
The accompanying notes are an integral part of this consolidated statement of comprehensive income and expense.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
60
60
60
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Consolidated Statement of Financial Position
As at 31 December 2015
Consolidated Statement of Financial Position
As at 31 December 2015
Non-current assets
Biological assets
Non-current assets
Property, plant and equipment
Biological assets
Receivables
Property, plant and equipment
Deferred tax assets
Receivables
Deferred tax assets
Current assets
Inventories
Current assets
Tax receivables
Inventories
Trade and other receivables
Tax receivables
Cash and cash equivalents
Trade and other receivables
Cash and cash equivalents
Current liabilities
Loans and borrowings
Current liabilities
Trade and other payables
Loans and borrowings
Tax liabilities
Trade and other payables
Dividend payables
Tax liabilities
Dividend payables
Net current assets
Non- current liabilities
Net current assets
Loans and borrowings
Non- current liabilities
Deferred tax liabilities
Loans and borrowings
Retirement benefits – net liabilities
Deferred tax liabilities
Retirement benefits – net liabilities
Net assets
Issued capital and reserves attributable to owners of the parent
Net assets
Share capital
Issued capital and reserves attributable to owners of the parent
Treasury shares
Share capital
Share premium
Treasury shares
Capital redemption reserve
Share premium
Revaluation reserves
Capital redemption reserve
Exchange reserves
Revaluation reserves
Retained earnings
Exchange reserves
Retained earnings
Non-controlling interests
Total equity
Non-controlling interests
Note
Note
10
10
10
11
10
16
11
16
12
12
13
13
14
15
14
15
14
16
14
17
16
17
18
18
18
18
2015
$000
2015
$000
179,010
219,990
179,010
3,655
219,990
8,021
3,655
410,676
8,021
410,676
6,693
16,679
6,693
4,704
16,679
104,614
4,704
132,690
104,614
132,690
(1,750)
(17,406)
(1,750)
(5,917)
(17,406)
-
(5,917)
(25,073)
-
107,617
(25,073)
107,617
(32,875)
(28,932)
(32,875)
(4,528)
(28,932)
(66,335)
(4,528)
451,958
(66,335)
451,958
15,504
(1,171)
15,504
23,935
(1,171)
1,087
23,935
59,594
1,087
(234,490)
59,594
504,892
(234,490)
369,351
504,892
82,607
369,351
451,958
82,607
2014
$000
2014
$000
251,374
227,380
251,374
3,007
227,380
3,982
3,007
485,743
3,982
485,743
7,846
9,231
7,846
8,807
9,231
125,937
8,807
151,821
125,937
151,821
(313)
(21,010)
(313)
(10,752)
(21,010)
(20)
(10,752)
(32,095)
(20)
119,726
(32,095)
119,726
(34,625)
(48,350)
(34,625)
(4,445)
(48,350)
(87,420)
(4,445)
518,049
(87,420)
518,049
15,504
(1,171)
15,504
23,935
(1,171)
1,087
23,935
57,029
1,087
(190,503)
57,029
521,355
(190,503)
427,236
521,355
90,813
427,236
518,049
90,813
Total equity
The financial statements were approved by the Board of Directors and authorised for issue on 26 April 2016 and were signed on its behalf by
518,049
451,958
The financial statements were approved by the Board of Directors and authorised for issue on 26 April 2016 and were signed on its behalf by
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
The accompanying notes are an integral part of this consolidated statement of financial position.
The accompanying notes are an integral part of this consolidated statement of financial position.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
61
61
61
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Consolidated Statement of Cash Flows
For the year ended 31 December 2015
Cash flows from operating activities
(Loss) / Profit before tax
Adjustments for:
BA adjustment
(Profit) / Loss on disposal of tangible fixed assets
Depreciation
Retirement benefit provisions
Net finance income
Unrealised loss / (gain) in foreign exchange
Property, plant and equipment written off
Operating cash flow before changes in working capital
Decrease in inventories
Decrease in non-current, trade and other receivables
(Decrease) / Increase in trade and other payables
Cash inflow from operations
Interest paid
Retirement benefit paid
Overseas tax paid
Net cash flow from operations
Investing activities
Property, plant and equipment
- purchase
- sale
Interest received
Net cash used in investing activities
2015
$000
2014
$000
(19,074)
51,236
64,121
(111)
6,768
973
(4,673)
2,354
1,708
52,066
341
4,425
(1,623)
55,209
(2,010)
(103)
(27,856)
25,240
33,718
36
6,833
951
(5,257)
(852)
135
86,800
451
664
5,929
93,844
(2,019)
(61)
(17,756)
74,008
(38,555)
(49,754)
979
6,683
156
7,276
(30,893)
(42,322)
Annual Report 2015 | Anglo-Eastern Plantations Plc
63
63
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Consolidated Statement of Cash Flows
For the year ended 31 December 2015
Financing activities
Dividends paid by Company
Consolidated Statement of Cash Flows
For the year ended 31 December 2015
Finance lease repayment
Dividends paid to minority shareholders
Repayment of existing long term loans
Net cash (used in) / from financing activities
Financing activities
(Decrease) / Increase in cash and cash equivalents
Dividends paid by Company
Finance lease repayment
Cash and cash equivalents
Dividends paid to minority shareholders
At beginning of year
Repayment of existing long term loans
Foreign exchange
Net cash (used in) / from financing activities
At end of year
(Decrease) / Increase in cash and cash equivalents
Comprising:
Cash at end of year
Cash and cash equivalents
At beginning of year
Foreign exchange
At end of year
Comprising:
Cash at end of year
2015
$000
(1,869)
-
(228)
(313)
2015
$000
(2,410)
(8,063)
(1,869)
-
(228)
125,937
(313)
(13,260)
(2,410)
104,614
(8,063)
104,614
125,937
(13,260)
104,614
2014
$000
(1,998)
(20)
(402)
(63)
2014
$000
(2,483)
29,203
(1,998)
(20)
(402)
98,738
(63)
(2,004)
(2,483)
125,937
29,203
125,937
98,738
(2,004)
125,937
104,614
125,937
The accompanying notes are an integral part of this consolidated statement of cash flows.
.
The accompanying notes are an integral part of this consolidated statement of cash flows.
.
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
64
64
64
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
1 Accounting policies
Anglo-Eastern Plantations Plc (“AEP”) is a company incorporated in the United Kingdom under the Companies Act 2006 and is listed on the
London Stock Exchange. The registered office of AEP is located at Quadrant House, 6th Floor, 4 Thomas More Square, London E1W 1YW,
United Kingdom. The principal activity of the Group is plantation agriculture.
The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have
been consistently applied to all years presented, except as detailed in the following paragraph.
Basis of preparation
The financial statements have been prepared in accordance with International Financial Reporting Standards and its interpretations (IFRS
and IFRIC interpretations) issued by the International Accounting Standards Board (“IASB”) as adopted by the European Union (“EU”) and
with those parts of the Companies Act 2006 applicable to companies preparing their accounts under IFRS as adopted by the EU.
Changes in accounting standards
a)
The following amendment is effective for the first time in these financial statements but does not have a material effect on the Group's
financial statements:
•
IAS 19 Amendments - Defined Benefit Plans: Employee Contributions (effective for accounting periods beginning on or after 1
July 2014)
b)
New standards, interpretations and amendments not yet effective.
The following new standards, interpretations and amendments are effective for periods beginning after 1 January 2016 and have not
been applied in these financial statements:
•
•
•
•
•
IFRS 9 Financial Instruments (effective for accounting periods beginning on or after 1 January 2018)*
IFRS 15 Revenue from Contracts with Customers (effective for accounting periods beginning on or after 1 January 2018)*
IFRS 16 Leases (effective for accounting periods beginning on or after 1 January 2019)*
IAS 16 Amendments - Property, Plant and Equipment (effective for accounting periods beginning on or after 1 January 2016)*
IAS 41 Amendments - Agriculture (effective for accounting periods beginning on or after 1 January 2016)*
*These standards and interpretations are not endorsed by the EU at present.
None of the above new standards, interpretations and amendments are expected to have a material effect on the Group's future
financial statements except for IAS 16 and IAS 41. The amendments to IAS 16 and IAS 41 change the accounting requirements for
biological assets that meet the definition of bearer plants. Biological assets that meet the definition of bearer plants are required to
account for as bearer plants in accordance with IAS 16 using either cost model or revaluation model. The produce growing on bearer
plants will remain within the scope of IAS 41 measured at fair value less costs to sell.
The biological assets of the Group fall within the definition of bearer plants. With effect from 1 January 2016, immature plantations will
be recognised at cost and accumulated until maturity whereas mature plantations will be recognised at historical cost less
accumulated depreciation. Immature plantations are subject to impairment reviews. The FFB, which is agricultural produce under the
revised IAS 41, will be recognised at fair value less cost to sell at the point of harvest, with changes recognised in profit or loss.
However, the Company has yet to reach a decision as to the measurement of the unharvested produce at balance sheet date.
The directors have quantified the financial impact that would have on the Group with the adoption of the amended IAS 16 and IAS 41.
The Group would have been reported a profit for the year ended 31 December 2015 of US$24.9 million rather than a loss for the year
of US$13.4 million. Included in the adjusted loss for the year was an impairment loss on bearer plants of US$34.1 million. The Group’s
reported net assets as at 31 December 2015 would have been US$324.5 million rather than US$369.4 million. The impacts on the
financial position of the Group are disclosed below:
Non-current assets
Biological assets
Property, plant and equipment
Non-current liabilities
Deferred tax liabilities
Issued capital and reserves attributable to
owners of the parent
Retained earnings
Non-controlling interests
Reported as at
31 Dec 2015
$000
Adjustments
$000
Financial position
after adjustments
$000
179,010
219,990
(179,010)
124,644
-
344,634
(28,932)
2,314
(26,618)
(504,892)
(82,607)
44,847
7,205
(460,045)
(75,402)
Annual Report 2015 | Anglo-Eastern Plantations Plc
65
65
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
1 Accounting policies - continued
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. The Company controls a subsidiary if all three of the following elements are present;
power over the subsidiary, exposure to variable returns from the subsidiary, and the ability of the investor to use its power to affect those
variable returns. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control
commences until the date control ceases.
Business combinations
The consolidated financial statements incorporate the results of business combinations using the purchase method. In the consolidated
statement of financial position, 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 do not represent business
combinations, in such cases, the amount paid for each acquisition is allocated between the identifiable assets/liabilities at the acquisition
date.
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 Dollar. The presentation currency for the
consolidated financial statements is also US Dollar, chosen because, as internationally traded commodities, the price of the bulk of the
Group’s products are ultimately link to the US Dollar.
On consolidation, the results of overseas operations are translated into US Dollar 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, biomass products and other income of an operating nature.
Sales of CPO, palm kernel, shell nut, biomass products and rubber slab 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 latex are recognised on signing of sales contract,
this being the point at which the significant risks and rewards of ownership are passed over to the buyer. Other income mainly consists of
amounts received from sales of nut shell, which is recognised when the goods are delivered.
Share based payments
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 binomial 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.
Capitalisation on development activities
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.
Annual Report 2015 | Anglo-Eastern Plantations Plc
66
66
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
1 Accounting policies - continued
Plantation development
Plantation development comprises cost of planting and development on oil palm and other plantation crops. Costs of new planting and
development of plantation crops are capitalised from the stage of land clearing up to the stage of maturity or subject to certificate of Land
Exploitation Rights (HGU) being obtained, whichever is earlier. The costs of immature plantations consist mainly of the accumulated cost of
land clearing, planting, fertilising and maintaining the plantation, borrowing costs and other indirect overhead costs up to the time the trees
are harvestable and to the extent appropriate.
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.
The directors consider that the carrying amount of tax receivables approximates its fair value.
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.
Fair value measurement
A number of assets and liabilities included in the Group’s financial statements require measurement at, and/or disclosure of, fair value. The
fair value measurement of the Group’s financial and non-financial assets and liabilities utilises market observable inputs and data as far as
possible. Inputs used in determining fair value measurements are categorised into different levels based on how observable the inputs used
in the valuation technique utilised are (the ‘fair value hierarchy’):
•
•
•
Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2 - inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or
indirectly;
Level 3 - unobservable inputs for the asset or liability.
The classification of an item into the above levels is based on the lowest level of the inputs used that has a significant effect on the fair value
measurement of the item. Transfers of items between levels are recognised in the period they occur.
The Group measures the following assets at fair value:
• Biological assets (note 10)
• Revalued land - Property, plant and equipment (note 10)
For more detailed information in relation to the fair value measurement of the items above, please refer to the applicable notes.
Property, plant and equipment
All items of property, plant and equipment are initially measured at cost. Cost includes expenditure that is directly attributable to the
acquisition of the items. After initial recognition, all items of property, plant and equipment except land and construction in progress, are
stated at cost less accumulated depreciation and any accumulated impairment losses.
The Indonesian authorities have granted certain land exploitation rights and operating permits for the estates. The land rights are usually
renewed without significant cost subject to compliance with the laws and regulations of Indonesia. Therefore, the Group has classified the
land rights as leasehold land and accounted for as an indefinite finance lease. The leasehold land is recognised at cost initially and is not
depreciated. The land is subsequently carried at fair value, based on periodic valuations on an open market basis by a professionally
qualified valuer. These revaluations are made with sufficient regularity to ensure that the carrying amount does not differ materially from that
which would be determined using fair value at the end of the reporting period. Changes in fair value are recognised in other comprehensive
income and accumulated in the revaluation reserve except to the extent that any decrease in value in excess of the credit balance on the
revaluation reserve, or reversal of such a transaction, is recognised in income statement. On the disposal of a revalued estate, any related
balance remaining in the revaluation reserve is transferred to retained earnings as a movement in reserves.
Construction in progress is stated at cost. The accumulated costs will be reclassified to the appropriate class of assets when construction is
completed and the asset is ready for its intended use. Construction in progress is also not depreciated until such time when the asset is
available for use.
Buildings and oil mills are depreciated using the straight-line method. All other property, plant and equipment items are depreciated using the
double-declining-balance method. The yearly rates of depreciation are as follows:
Buildings - 5% to 10% per annum
Oil Mill - 5% per annum
Estate plant, equipment & vehicle - 12.5% to 50% per annum
Office plant, equipment & vehicle - 25% to 50% per annum
Annual Report 2015 | Anglo-Eastern Plantations Plc
67
67
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
1 Accounting policies - continued
Biological assets
Biological assets comprise oil palm trees and nurseries. The biological process commences with the initial preparation of land and planting of
seedlings and ceases with the delivery of crop in the form of fresh fruit bunches (“FFB”) to the manufacturing process in which crude palm oil
and palm kernel are extracted from the FFB.
Biological assets are carried at fair value less costs to sell determined on the basis of the net present value of cash flows arising in producing
FFB. No account is taken in the valuation of future replanting. Biological assets are valued at each accounting date based upon a valuation
of the planted areas using a discounted cash flow method by reference to the FFB expected to be harvested over the full remaining
productive life of the trees up to 20 years. Areas are included in the valuation once they are planted. However oil palm which are not yet
mature at the accounting date, and hence are not producing FFB, are valued on a similar basis but with the discounted value of the
estimated cost to complete planting and to maintain the assets to maturity being deducted from the discounted FFB value. 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
in accordance with Group depreciation policy for those held at cost. Land rights are held at fair value and revalued at the balance sheet date.
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 in the income statement, except to the extent they reverse gains previously recognised in the statement of
recognised income and expense.
Inventories
FFB harvested from the biological assets are stated at fair value less costs to sell at the point of harvest. The fair value gain arising on the
initial recognition of harvested produce is the result of the FFB weight produced multiplied by the FFB price adjusted for transportation costs
to sell. There is an active market for FFB and the price is based on statistics provided by the government for each region.
The gain/(loss) arising on the initial recognition at the point of harvest is recognised in the income statement within the biological asset
revaluation. The FFB is transferred to the mill, processed in to CPO and sold within 24 hours so the write off of the FFB is netted off against
the initial recognition within the biological asset revaluation.
All other inventories are initially recognised at cost, and subsequently at the lower of cost and net realisable value. In the case of processed
produce for sale which comprises palm oil and kernel, cost represents the monthly weighted-average cost of production, and appropriate
production overheads. Estate and mill consumables are valued on a weighted average cost basis.
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 with an original maturity of not exceeding three months.
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.
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 and subsequently at amortised cost.
Annual Report 2015 | Anglo-Eastern Plantations Plc
68
68
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
1 Accounting policies - continued
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.
The Group recognises deferred tax liabilities arising from taxable temporary differences on investments in subsidiaries, except where the
Group is able to control the reversal of the temporary differences and it is probable that the temporary difference will not reverse in the
foreseeable future.
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 enacted or substantively enacted at the balance sheet date. 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
Defined contribution schemes
Contributions to defined contribution pension schemes are charged to the consolidated income statement in the year to which they relate.
Defined benefit schemes
The Group operates a number of defined benefit schemes in respect of its Indonesian operations. These schemes’ surpluses and deficits are
measured at:
•
•
•
•
The fair value of plan assets at the reporting date; less
Plan liabilities calculated using the projected unit credit method discounted to its present value using yields available on high quality
corporate bonds that have maturity dates approximating to the terms of the liabilities; plus
Unrecognised past service costs; less
The effect of minimum funding requirements agreed with scheme trustees.
Remeasurements of the net defined obligation are recognised directly within equity. The remeasurements include:
•
•
•
Actuarial gains and losses;
Return on plan assets (interest exclusive);
Any asset ceiling effects (interest inclusive).
Service costs are recognised in comprehensive income, and include current and past service costs as well as gains and losses on
curtailments.
Net interest expense / (income) is recognised in comprehensive income, and is calculated by applying the discount rate used to measure the
defined benefit obligation / (asset) at the beginning of the annual period to the balance of the net defined benefit obligation / (asset),
considering the effects of contributions and benefit payments during the period.
Gains or losses arising from changes to scheme benefits or scheme curtailment are recognised immediately in comprehensive income.
Settlements of defined benefit schemes are recognised in the period in which the settlement occurs.
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.
Annual Report 2015 | Anglo-Eastern Plantations Plc
69
69
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
1 Accounting policies - continued
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 current and future periods.
Assumptions regarding the valuation of biological assets, property, plant and equipment are set out in note 10. Assumptions regarding the
valuation of agricultural produce at the point of harvest less costs to sell are set out in the inventories accounting policy. The Group's policy
with regard to impairment of such assets is set out above.
Details on deferred tax are given in note 16 and retirement benefits in note 17.
2 Revenue
Sales of produce:
- CPO
- Rubber
- Shell nut
- Biomass products
3 Finance income and expense
Finance income
Interest receivable on:
Credit bank balances and time deposits
Finance expense
Interest payable on:
Development loans - (note 14)
Net finance income recognised in income statement
-
2015
$000
193,364
1,075
1,685
327
196,451
2014
$000
247,868
1,836
1,554
-
251,258
2015
$000
2014
$000
6,683
7,276
(2,010)
4,673
(2,019)
5,257
Annual Report 2015 | Anglo-Eastern Plantations Plc
70
70
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
4 Profit before tax
Profit before tax is stated after charging
Depreciation (note 10)
Exchange losses / (gains)
Operating lease expense
- Property
Professional fees
Staff costs (note 6)
Remuneration received by the group’s auditor or associates of the group’s auditor:
- Audit of parent company
- Audit of consolidated financial statement
- Audit related assurance service
- Audit of UK subsidiaries
Total audit services
Audit of overseas subsidiaries
- Malaysia
- Indonesia
Total audit services
Total auditors’ remuneration
5 Segment information
2015
$000
6,768
2,354
523
1,086
29,007
5
157
7
13
182
19
66
85
267
2014
$000
6,833
(852)
574
441
28,881
6
159
7
-
172
22
75
97
269
Measurement of operating segment profit or loss, assets and liabilities
The Group evaluates segmental performance on the basis of profit or loss from operations calculated in accordance with IFRS but excluding
non-recurring losses, such as share based payments.
Inter-segment transactions are made based on terms mutually agreed by the parties to maximise the utilisation of Group’s resources at a
rate acceptable to local tax authorities. This policy was applied consistently throughout the current and prior period.
The Group’s assets are allocated to segments based on geographical location.
Annual Report 2015 | Anglo-Eastern Plantations Plc
71
71
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
6 Employees' and Directors' remuneration
Average numbers employed (primarily overseas) during the year:
- full time
- part-time field workers
Staff costs (including Directors) comprise:
Wages and salaries
Social security costs
Retirement benefit costs
- Indonesia (note 17)
- Malaysia
2015
Number
5,832
10,980
16,812
2015
$000
26,691
880
1,378
58
29,007
2014
number
5,522
9,687
15,209
2014
$000
26,725
939
1,150
67
28,881
The information required by the Companies Act and the Listing Rules of the Financial Conduct Authority is contained in the Directors'
remuneration report on pages 47 - 51 of which certain information on pages 50- 51 has been audited.
Directors emoluments
Remuneration expense for key management personnel
2015
$000
240
2,289
2014
$000
248
2,273
The Executive Director, Non-Executive Directors and senior management (general managers and above) are considered to be the key
management personnel. The remuneration of Executive Director and Non-Executive Directors is shown on page 51.
7 Tax expense
Foreign corporation tax - current year
Foreign corporation tax - prior year
Deferred tax adjustment - origination and reversal of temporary differences
Total tax charge for year
2015
$000
15,069
208
(20,922)
(5,645)
2014
$000
22,855
32
(10,349)
12,538
Both corporation tax rates in Indonesia and Malaysia are at 25%. The standard rate of corporation tax in the UK for the current year is 20%.
The Group’s charge for the year differs from the standard UK rate of corporation tax for the reasons below.
Profit before tax
Profit before tax multiplied by standard rate of UK corporation tax of 20% (2014: 21%)
Effects of:
Rate adjustment relating to overseas profits
Group accounting adjustments not subject to tax
Expenses not allowable for tax
Income not subject to tax
Under provision of prior year income tax
(Over) / Under provision of prior year deferred tax assets
Deferred tax assets not recognised
Total tax charge for year
Annual Report 2015 | Anglo-Eastern Plantations Plc
2015
$000
(19,074)
(3,815)
(1,051)
(542)
1,304
(1,737)
208
(40)
28
(5,645)
2014
$000
51,236
10,760
1,845
(27)
184
(309)
32
53
-
12,538
74
74
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
8
Earnings per ordinary share (EPS)
Profit for the year attributable to owners of the 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
Dilutive EPS before BA adjustment
Dilutive EPS after BA adjustment
9
Dividends
Paid during the year
Final dividend of 3.0p per ordinary share for the year ended 31 December 2014
(2013: 3.0p)
Proposed final dividend of 1.75p per ordinary share for the year ended 31 December 2015
(2014: 3.0p)
2015
$000
27,505
(42,402)
(14,897)
Number
‘000
39,636
-
39,636
69.39cts
(37.58)cts
69.39cts
(37.58)cts
2015
$000
1,869
1,028
2014
$000
52,422
(21,660)
30,762
Number
‘000
39,636
43
39,679
132.26cts
77.61cts
132.12cts
77.53cts
2014
$000
1,998
1,854
The proposed dividend for 2015 is subject to shareholders’ approval at the forthcoming annual general meeting and has not been included
as a liability in these financial statements.
Annual Report 2015 | Anglo-Eastern Plantations Plc
75
75
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
10 Biological assets, property, plant and equipment - continued
The fair value less costs to sell of FFB harvested during the period, determined at the point of harvest is exhibited below:
Fair value of FFB
Crop production and yield - FFB (mt)
Fair value of FFB ($000)
Fair value of FFB less costs to sell ($000)
2015
900,000
101,019
90,924
2014
857,000
132,342
121,850
As referred to on page 76, the gain arising on the fair value of FFB at the point of harvest is recognised in the income statement within the
biological asset revaluation. A reconciliation of the amount included within the income statement and the biological asset has been included
below:
Harvest included in the biological asset valuation from estimated production and pricing
assumptions less costs to sell in the prior year
Gain from actual production and pricing
Fair value of FFB harvested from own production
2015
$000
25,221
65,703
90,924
2014
$000
26,021
95,829
121,850
The decrease of $25,221,000 (2014: $26,021,000) from harvest was included in the prior year valuation for the current year and is therefore
deducted from biological asset valuation in the current year as the FFB is harvested. The actual fair value of harvested FFB varies to forecast
due to the changes in actual production, actual FFB price and actual costs incurred. The gain on fair value of the harvested FFB is written off
as the FFB is processed in to CPO.
The biological asset revaluation movement included within the income statement is calculated as follows:
Decrease due to harvest
Revaluations
Net loss arising in the income statement from changes in fair value of biological assets
2015
$000
(25,221)
(38,900)
(64,121)
2014
$000
(26,021)
(7,697)
(33,718)
The Group engaged Muttaqin Bambang Purwanto Rozak Uswatun & Rekan (MBPRU) with its head office located in Jakarta, Indonesia to
undertake the valuation of biological assets for both financial years ended 31 December 2014 and 2015. Except for an adjustment on
discount rate, CPO price and the measurement of the notional rent which are determined by the Directors, the valuation was carried out
independently by MBPRU who has the appropriate professional qualifications and recent experience in the location and category of the
properties being valued. Further information of MBPRU can be obtained from ‘www.kjpp-mbpru.com’.
MBPRU was also engaged to undertake the land valuation for the Group. For the year ended 31 December 2015, valuation was done on
land of nine subsidiaries. The increase per hectare obtained by comparing the current valuation against the year 2014’s carrying amount
were then applied to the 2014 land value of the remaining companies in the same geographical location to derive the fair value of land in
2015. In the year 2014, independent land valuation was undertaken for 11 subsidiary companies in Indonesia. The increase per hectare
obtained by comparing the year 2014 valuation against the valuation undertaken in year 2013 were then applied to the 2013 land value of the
remaining subsidiary companies in the same geographical location to derive the fair value of land in 2014. Unplantable land was excluded in
this exercise since it has zero value. Land is valued on a rotational basis and all land is valued by qualified valuers every two years. Had the
revalued land been measured on a historical cost basis, their net book value would have been $42,993,000 (2014: $47,317,000).
Annual Report 2015 | Anglo-Eastern Plantations Plc
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77
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
10 Biological assets, property, plant and equipment - continued
The methodology of the biological asset valuations was using discounted cash flow (“DCF”) over the expected 20-year economic life of the
asset. The assumption applied in the valuation were, inter alia, an assumed CPO selling price of $625/mt (2014: $700/mt), discount rate of
16.8% (2014: 16.4%) and notional rent equivalent to 9% (2014: 9%) of the value of planted land. The discount rates were determined by the
Directors based on their assessment of various risks including financial, business and country risk of where the plantations are located as
well as taking into account the Company’s weighted average cost of capital. The CPO price is normally based on the 10-year average (2014:
10-year average) rounded to the nearest $25 based on historical widely-quoted commodity price for CPO and represents the Directors’ best
estimate of the price sustainable over the longer term. However the CPO price for 2015 remained weak. It ended the year at $560/mt far
lower than the 10-year average CPO price at $750/mt, therefore a benchmarking exercise was made to ensure the directors’ best estimate of
the price sustainable over the longer term is being used. The directors adopted the recommendation of the valuer who has suggested
applying a ratio of 70% of the current CPO price and 30% of the historical price (10-year average) given the assumption to calculate CPO
price over the past 10 years is no longer considered to be appropriate. As a result, the directors adopted the CPO price of $625/mt which
falls within the valuer’s recommended range of $600/mt to $650/mt and the World Bank forecast of CPO price for 2016 at $600/mt. An
inflation rate of 3.4% (2014: 4.0%) was applied to the second to sixth years of the DCF. The notional rent charge is based on key capital
market and property indicators in the countries and regions of operations.
Details of the information about the fair value hierarchy in relation to biological assets and land at 31 December are as follows:
At 31 December 2015
Biological assets
Land
At 31 December 2014
Biological assets
Land
Level 1
$000
Level 2
$000
Level 3
$000
Fair value
$000
-
-
-
-
-
-
-
-
179,010
140,689
179,010
140,689
251,374 251,374
150,982
150,982
There were no items classified under Level 1 and Level 2 and thus there were no transfers between Level 1 and Level 2 during the year.
The valuation techniques and significant unobservable inputs used in determining the fair value measurement of biological assets and land,
as well as the inter-relationship between key unobservable inputs and fair value, are set out in the table below:
Item
Valuation approach
Inputs used
Inter-relationship between key
unobservable
inputs and fair
value
Land
location
Selling prices of comparable land in
similar
for
adjusted
differences
in key attributes. The
valuation model is based on price per
hectare.
Location, legal title, land area,
land type and topography
Selling prices of comparable land
The higher the selling price, the
higher the fair value
Biological
assets
Discounted cash
the
expected 20-year economic life of the
asset
flow over
CPO selling price
Discount rate
Notional rent
Yield
Overhead cost
These are qualitative inputs which
require significant judgement by
professional valuer, MBPRU
The higher the CPO selling price,
the higher the fair value
The higher the discount rate, the
lower the fair value
The higher the notional rent, the
lower the fair value
The higher the yield, the higher the
fair value
The higher the overhead cost, the
lower the fair value
Annual Report 2015 | Anglo-Eastern Plantations Plc
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78
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
10 Biological assets, property, plant and equipment - continued
There were no changes to the valuation techniques during the period.
The fair value measurement is based on the above items’ highest and best use, which does not differ from their actual use.
The following table exhibits the sensitivity of the Group’s biological assets to the fluctuation in CPO price, discount rate, notional rent, CPO
yield and overhead cost:
A change of $50 in the price assumption for CPO
-$50 in the price assumption
+$50 in the price assumption
A change of 1% in the discount rate
-1% in the discount rate
+1% in the discount rate
A change of notional rent equivalent to 1% of the value of planted land
-1% in the value of planted land
+1% in the value of planted land
A change of 1% in the CPO yield
-1% in the CPO yield
+1% in the CPO yield
A change of 1% in the overhead cost
-1% in the overhead cost
+1% in the overhead cost
2015
$000
(56,647)
56,670
8,900
(8,207)
4,849
(4,848)
(23,117)
23,140
6,272
(6,249)
2014
$000
(54,021)
53,993
14,182
(13,043)
5,191
(5,190)
(28,863)
28,835
7,468
(7,496)
The estates include $483,000 (2014: $1,321,000) of interest and $4,909,000 (2014: $5,623,000) of overheads capitalised during the year in
respect of expenditure on estates under development.
The Indonesian authorities have granted certain land exploitation rights and operating permits for the estates. In the case of established
estates in North Sumatera these rights and permits expire between 2023 and 2038 with rights of renewal thereafter. As of estates in
Bengkulu land titles were issued between 1994 and 2008 and the titles expire between 2028 and 2034 with rights of renewal thereafter for
two consecutive periods of 25 and 35 years respectively. In Riau, land titles were issued in 2004 and expire in 2033. In the case of PT
Cahaya Pelita Andhika’s estate acquired in 2007 land titles were issued in 1996 to expire in 2029.
Subject to compliance with the laws and regulations of Indonesia, land rights are usually renewed. The cost of renewing the land rights is not
significant.
The land title of the estate in Malaysia is a long-term lease expiring in 2084.
11 Receivables: non-current
Due from non-controlling interests
Due from cooperatives under Plasma scheme
Due from village smallholder schemes
2015
2014
Book value
$000
Fair value
$000
Book value
$000
Fair value
$000
1,193
2,231
231
3,655
924
2,056
213
3,193
1,193
1,557
257
3,007
872
1,397
237
2,506
The non-controlling interests in PT Alno Agro Utama and PT Cahaya Pelita Andhika have acquired their interests on deferred terms (see
note 23, Credit risk).
Plasma scheme is an initiative by the Indonesian Government that seeks to encourage plantation owners in Indonesia to provide economic
and social assistance to surrounding villagers by helping them improve their income and welfare. During the year, certain subsidiary
companies have funded the plantation development cost of $2,231,000 (2014: $1,557,000) for the land allocated to the cooperatives which
will be recoverable from them.
Amount due from village smallholder schemes represents expenditure on planting and maintaining to maturity oil palms on communal land
owned by 22 (2014: 22) separate villages neighbouring the Group's estates.
The fair value disclosed above are for disclosure purposes and all non-current receivables are classified as Level 3 in the fair value
hierarchy.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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79
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
11 Receivables: non-current – continued
The valuation techniques and significant unobservable inputs used in determining the fair value measurement of non-current receivables, as
well as the inter-relationship between key unobservable inputs and fair value, are set out in the table below:
Item
Valuation approach
Inputs used
Inter-relationship between key
inputs and fair
unobservable
value
Due from non-controlling
interests
Based on cash flows discounted using
current lending rate of 6% (2014: 6%)
Discount rate
The higher the discount rate, the
lower the fair value
from cooperatives
Due
under Plasma scheme
Based on cash flows discounted using
an estimated current lending rate of
5.57% (2014: 5.58%)
Discount rate
The higher the discount rate, the
lower the fair value
Due
smallholder schemes
from
village
Based on cash flows discounted using
an estimated current lending rate of
5.57% (2014: 5.58%)
Discount rate
The higher the discount rate, the
lower the fair value
12
Inventories
Estate and mill consumables
Processed produce for sale
13 Trade and other receivables
Trade receivables
Other receivables
Prepayments and accrued income
2015
$000
5,887
806
6,693
2015
$000
271
4,211
222
4,704
2014
$000
3,183
4,663
7,846
2014
$000
1,538
7,081
188
8,807
The carrying amount of trade and other receivables classified as loans and receivables approximates fair value.
14 Loans and borrowings
Non-current
Long term loan (a)
Long term loan (b)
Current
Long term loan (a)
Long term loan (b)
2015
2014
Book value
$000
Fair value
$000
Book value
$000
Fair value
$000
4,000
28,875
32,875
625
1,125
1,750
3,899
28,407
32,306
625
1,125
1,750
4,625
30,000
34,625
313
-
313
4,523
29,505
34,028
313
-
313
Total loans and borrowings
34,625
34,056
34,938
34,341
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
12,750
20,125
32,875
7,784
26,841
34,625
Annual Report 2015 | Anglo-Eastern Plantations Plc
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80
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
14 Loans and borrowings – continued
(a)
(b)
A subsidiary company, PT Hijau Pryan Perdana, has obtained a long term loan of $10,000,000 for a period of seven years (including
two years grace repayment period) to support the capital expenditures requirement for planting, development and maintenance of oil
palm estate and to finance mill construction and other fixed assets owned by the subsidiary company as well to utilise for repayment
of amount due to related parties. It is secured by the subsidiary company’s land and is guaranteed by PT Tasik Raja and by the
Company. This loan bears interest rate based on Base Lending Rate which is payable quarterly in arrears. Average interest in 2015
was about 5.38% (2014: 5.39%). The loan is repayable from 30 November 2014 to 30 August 2019.
Another subsidiary company, PT Sawit Graha Manunggal, has obtained a long term loan of $35,000,000 for a period of eight years
(including four years grace repayment period) to support the capital expenditures requirement for planting, development and
maintenance of oil palm estate and to finance oil mill construction and other fixed assets owned by the subsidiary company. It is
secured by the subsidiary company’s land and is guaranteed by the Company. This loan bears interest rate based on SIBOR +
4.5% + Liquidity Premium which is payable quarterly in arrears. Average interest in 2015 was about 5.76% (2014: 5.76%). The loan
is repayable from 30 December 2016 to 30 September 2020.
The fair value of the items classified as loans and borrowings is disclosed below and is classified as Level 3 in the fair value hierarchy:
2015
2014
Book value
$000
Fair value
$000
Book value
$000
Fair value
$000
Loans and borrowings
34,625
34,056
34,938
34,341
The fair value for disclosure purposes has been determined using discounted cash flows. Significant inputs include the discount rate used to
reflect the credit risk associated with the Group. The fair value reduces as higher discount rate being used.
15 Trade and other payables
Trade payables
Other payables
Accruals
2015
$000
7,732
2,956
6,718
17,406
2014
$000
7,342
6,027
7,641
21,010
The carrying amount of trade and other payables classified as financial liabilities measured at amortised cost approximates fair value.
Annual Report 2015 | Anglo-Eastern Plantations Plc
81
81
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
16 Deferred tax
The movement on the deferred tax account is as shown below:
At 1 January
Recognised in profit and loss:
Tax expense
Revaluation of biological assets
Recognised in other comprehensive income:
Revaluation of leasehold land
Retirement benefits
Exchange differences
At 31 December
2015
$000
(44,368)
4,892
16,030
(1,226)
(111)
3,872
(20,911)
2014
$000
(55,298)
1,920
8,429
(96)
170
507
(44,368)
Details of the deferred tax liability, amounts recognised in profit or loss and amounts recognised in other comprehensive income are as
follows:
2015
Revaluation surplus
Retirement benefits
Unutilised tax losses
Other temporary differences
Tax assets / (liabilities)
Set off of tax
Net tax assets / (liabilities)
2014
Revaluation surplus
Retirement benefits
Unutilised tax losses
Other temporary differences
Tax assets / (liabilities)
Set off of tax
Net tax assets / (liabilities)
Asset
$000
-
1,127
6,970
-
8,097
(76)
8,021
-
1,106
3,021
-
4,127
(145)
3,982
Liability
$000
(28,907)
-
-
(101)
(29,008)
76
(28,932)
(48,087)
-
-
(408)
(48,495)
145
(48,350)
Net
$000
(28,907)
1,127
6,970
(101)
(20,911)
-
(20,911)
(48,087)
1,106
3,021
(408)
(44,368)
-
(44,368)
A deferred tax asset has not been recognised for the following items:
Unutilised tax losses
(Charged)/
credited to
profit or loss
$000
(Charged)/
credited
to equity
$000
16,054
249
4,386
233
20,922
-
20,922
8,438
196
1,460
255
10,349
-
10,349
2015
$000
2,842
(1,226)
(111)
-
-
(1,337)
-
(1,337)
(96)
170
-
-
74
-
74
2014
$000
2,787
The Group does not recognise the tax losses of certain companies in the Group as tax assets as the future recoverability of the losses
cannot be certain.
At the balance sheet date, the aggregate amount of temporary differences associated with undistributed earnings of subsidiaries for which
deferred tax liabilities have not been recognised was $3,028,799 (2014: $5,687,714). No liability has been recognised in respect of these
differences either because the Group is in a position to control the timing of reversal of the temporary differences, or because such a
reversal would not give rise to an additional liability.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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82
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
17 Retirement benefits
The Group operates two defined benefit schemes in respect of its Indonesian operations in accordance with Indonesia Labour Law No.
13/2003 ("the Law") dated 25 March 2003. The law does not impose funding requirement on Company to create fund asset to pay the
defined benefit obligations.
The first scheme is defined benefit pension scheme offered to certain employees. This scheme is funded and managed by SKU UKINDO
Pension Fund authorised by the Ministry of Finance of the Republic of Indonesia. When an employee reaches normal retirement age, dies or
becomes disabled, the Group shall pay the higher of the benefit from the pension scheme and the benefit calculated under the Law. The
assets value of the pension scheme is adequate to fund the annual payment of benefits.
The Group also established a funding programme through a savings plan managed by PT Asuransi Allianz Life Indonesia for the payment of
severance / pension for eligible staff. The assets of the fund are to be used only to settle defined benefit obligations. The assets value of the
funding programme is adequate to fund the annual payment of benefits.
The scheme is valued by an actuary at the end of each financial year. The major assumptions used by the actuary were:
Inflation
Rate of increase in wages
Rate of return on scheme assets
Discount rate
2015
5.0%
8.0%
8.3%
9.0%
2014
5.0%
8.0%
9.0%
8.3%
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.
Current service cost
Past service cost
Service cost
-
-
Net interest expense
Total employee benefits expense
2015
$000
1,016
20
342
1,378
2014
$000
905
(38)
283
1,150
Annual Report 2015 | Anglo-Eastern Plantations Plc
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83
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Notes to the Consolidated Financial Statements
Notes to the Consolidated Financial Statements
17 Retirement benefits - continued
17 Retirement benefits - continued
17 Retirement benefits - continued
17 Retirement benefits - continued
The following table exhibits the sensitivity of the Group’s retirement benefits to the fluctuation in the discount rate and wages:
The following table exhibits the sensitivity of the Group’s retirement benefits to the fluctuation in the discount rate and wages:
The following table exhibits the sensitivity of the Group’s retirement benefits to the fluctuation in the discount rate and wages:
The following table exhibits the sensitivity of the Group’s retirement benefits to the fluctuation in the discount rate and wages:
2015
2015
$000
2015
$000
2015
$000
$000
860
860
(758)
860
(758)
860
(758)
(758)
(799)
(799)
895
(799)
895
(799)
895
895
2014
2014
$000
2014
$000
2014
$000
$000
873
873
(845)
873
(845)
873
(845)
(845)
(881)
(881)
900
(881)
900
(881)
900
900
A change of 1% in the discount rate
A change of 1% in the discount rate
-1% in discount rate
A change of 1% in the discount rate
-1% in discount rate
A change of 1% in the discount rate
+1% in discount rate
-1% in discount rate
+1% in discount rate
-1% in discount rate
A change of 1% in wages
+1% in discount rate
A change of 1% in wages
+1% in discount rate
-1% in wages
A change of 1% in wages
-1% in wages
A change of 1% in wages
+1% in wages
-1% in wages
+1% in wages
-1% in wages
+1% in wages
+1% in wages
The following contributions, which reflect expected future service, as appropriate are expected to be paid:
The following contributions, which reflect expected future service, as appropriate are expected to be paid:
The following contributions, which reflect expected future service, as appropriate are expected to be paid:
The following contributions, which reflect expected future service, as appropriate are expected to be paid:
Year
Year
2016
Year
2016
Year
2017
2016
2017
2016
2018
2017
2018
2017
2019
2018
2019
2018
2020
2019
2020
2019
2021 to 2025
2020
2021 to 2025
2020
Total
2021 to 2025
Total
2021 to 2025
Total
Total
$000
$000
250
$000
250
$000
709
250
709
250
495
709
495
709
594
495
594
495
873
594
873
594
6,792
873
6,792
873
9,713
6,792
9,713
6,792
9,713
9,713
18 Share capital and treasury shares
18 Share capital and treasury shares
18 Share capital and treasury shares
18 Share capital and treasury shares
Ordinary shares of 25p each
Ordinary shares of 25p each
Beginning and end of year
Ordinary shares of 25p each
Beginning and end of year
Ordinary shares of 25p each
Beginning and end of year
Beginning and end of year
Authorised
Authorised
Number
Authorised
Number
Authorised
Number
Number
60,000,000
60,000,000
60,000,000
60,000,000
Treasury shares:
Treasury shares:
Beginning of year
Treasury shares:
Beginning of year
Treasury shares:
Share options exercised
Beginning of year
Share options exercised
Beginning of year
End of year
Share options exercised
End of year
Share options exercised
End of year
End of year
Market value of treasury shares:
Market value of treasury shares:
Beginning of year (555.0p/share)
Market value of treasury shares:
Beginning of year (555.0p/share)
Market value of treasury shares:
End of year (531.0p/share)
Beginning of year (555.0p/share)
End of year (531.0p/share)
Beginning of year (555.0p/share)
End of year (531.0p/share)
No treasury shares were purchased in 2015 (2014: Nil).
End of year (531.0p/share)
No treasury shares were purchased in 2015 (2014: Nil).
No treasury shares were purchased in 2015 (2014: Nil).
No treasury shares were purchased in 2015 (2014: Nil).
Issued and
Issued and
fully paid
Issued and
fully paid
Issued and
£000
fully paid
£000
fully paid
£000
£000
9,994
9,994
9,994
9,994
Issued and
Issued and
fully paid
Issued and
fully paid
Issued and
Number
fully paid
Number
fully paid
Number
Number
39,976,272
39,976,272
39,976,272
39,976,272
2015
2015
Number
2015
Number
2015
339,900
Number
339,900
Number
-
339,900
-
339,900
339,900
-
339,900
-
339,900
339,900
Authorised
Authorised
£000
Authorised
£000
Authorised
£000
£000
15,000
15,000
15,000
15,000
2014
2014
Number
2014
Number
2014
339,900
Number
339,900
Number
-
339,900
-
339,900
339,900
-
339,900
-
339,900
339,900
Authorised
Authorised
$000
Authorised
$000
Authorised
$000
$000
23,865
23,865
23,865
23,865
Cost
Cost
2015
Cost
2015
Cost
$’000
2015
$’000
2015
(1,171)
$’000
(1,171)
$’000
-
(1,171)
-
(1,171)
(1,171)
-
(1,171)
-
(1,171)
(1,171)
Issued and
Issued and
fully paid
Issued and
fully paid
Issued and
$000
fully paid
$000
fully paid
$000
$000
15,504
15,504
15,504
15,504
Cost
Cost
2014
Cost
2014
Cost
$’000
2014
$’000
2014
(1,171)
$’000
(1,171)
$’000
-
(1,171)
-
(1,171)
(1,171)
-
(1,171)
-
(1,171)
(1,171)
$’000
$’000
2,942
$’000
2,942
$’000
2,675
2,942
2,675
2,942
2,675
2,675
19 Ultimate controlling shareholder
19 Ultimate controlling shareholder
19 Ultimate controlling shareholder
19 Ultimate controlling shareholder
At 31 December 2015, Genton International Limited, a company registered in Hong Kong, held 20,247,814 (2014: 20,247,814) shares of the
At 31 December 2015, Genton International Limited, a company registered in Hong Kong, held 20,247,814 (2014: 20,247,814) shares of the
Company representing 51.1% (2014: 51.1%) of the issued share capital of the Company. Together with other deemed interested parties,
At 31 December 2015, Genton International Limited, a company registered in Hong Kong, held 20,247,814 (2014: 20,247,814) shares of the
Company representing 51.1% (2014: 51.1%) of the issued share capital of the Company. Together with other deemed interested parties,
At 31 December 2015, Genton International Limited, a company registered in Hong Kong, held 20,247,814 (2014: 20,247,814) shares of the
the Genton‘s shareholding totals 20,551,914 or 51.9%. Madam Lim, a Director of the Company, has advised the Company that she is the
Company representing 51.1% (2014: 51.1%) of the issued share capital of the Company. Together with other deemed interested parties,
the Genton‘s shareholding totals 20,551,914 or 51.9%. Madam Lim, a Director of the Company, has advised the Company that she is the
Company representing 51.1% (2014: 51.1%) of the issued share capital of the Company. Together with other deemed interested parties,
controlling shareholder of Genton International Limited.
the Genton‘s shareholding totals 20,551,914 or 51.9%. Madam Lim, a Director of the Company, has advised the Company that she is the
controlling shareholder of Genton International Limited.
the Genton‘s shareholding totals 20,551,914 or 51.9%. Madam Lim, a Director of the Company, has advised the Company that she is the
controlling shareholder of Genton International Limited.
controlling shareholder of Genton International Limited.
20 Related party transactions
20 Related party transactions
20 Related party transactions
20 Related party transactions
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not
disclosed in this note.
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not
disclosed in this note.
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not
disclosed in this note.
disclosed in this note.
During the year the Company engaged UHY Hacker Young, an accounting firm of which Dato’ John Lim Ewe Chuan is a partner, to provide
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 $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
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 $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
During the year the Company engaged UHY Hacker Young, an accounting firm of which Dato’ John Lim Ewe Chuan is a partner, to provide
outstanding at year end was $3,057 (2014: $3,483).
company secretarial and taxation services for a fee of $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
outstanding at year end was $3,057 (2014: $3,483).
company secretarial and taxation services for a fee of $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
outstanding at year end was $3,057 (2014: $3,483).
outstanding at year end was $3,057 (2014: $3,483).
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
during the year was $307,567 (2014: $319,147). There was no balance outstanding at year end (2014: Nil).
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
during the year was $307,567 (2014: $319,147). There was no balance outstanding at year end (2014: Nil).
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
during the year was $307,567 (2014: $319,147). There was no balance outstanding at year end (2014: Nil).
during the year was $307,567 (2014: $319,147). There was no balance outstanding at year end (2014: Nil).
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
85
85
85
85
85
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
Notes to the Consolidated Financial Statements
21 Reserves
21 Reserves
Amount of shares subscribed at nominal value.
Amount of shares subscribed at nominal value.
Amount subscribed for share capital in excess of nominal value.
Amount subscribed for share capital in excess of nominal value.
Nature and purpose of each reserve:
Nature and purpose of each reserve:
Share capital
Share capital
Share premium
Share premium
Capital redemption reserve Amounts transferred from share capital on redemption of issued shares.
Capital redemption reserve Amounts transferred from share capital on redemption of issued shares.
Treasury shares
Treasury shares
Revaluation reserve
Revaluation reserve
Foreign exchange reserve Gains/losses arising on translating the net assets of overseas operations into US Dollar.
Foreign exchange reserve Gains/losses arising on translating the net assets of overseas operations into US Dollar.
Retained earnings
Retained earnings
Cost of own shares held in treasury.
Cost of own shares held in treasury.
Gains/losses arising on the revaluation of the Group's property.
Gains/losses arising on the revaluation of the Group's property.
Cumulative net gains and losses recognised in the consolidated income statement.
Cumulative net gains and losses recognised in the consolidated income statement.
22 Guarantees and other financial commitments
22 Guarantees and other financial commitments
Capital commitments at 31 December
Capital commitments at 31 December
Contracted but not provided - normal estate operations
Contracted but not provided - normal estate operations
Authorised but not contracted - plantation and mill development
Authorised but not contracted - plantation and mill development
2015
2015
$000
$000
5,325
5,325
37,719
37,719
2014
2014
$000
$000
2,061
2,061
52,925
52,925
A subsidiary company, PT Sawit Graha Manunggal (“SGM”) has provided a corporate guarantee to Koperasi Bartim Sawit Sejahtera
A subsidiary company, PT Sawit Graha Manunggal (“SGM”) has provided a corporate guarantee to Koperasi Bartim Sawit Sejahtera
(“KBSS”), a party under Plasma scheme as disclosed in note 11, in relation to a loan undertaken by KBSS from PT Bank Mandiri (Persero)
(“KBSS”), a party under Plasma scheme as disclosed in note 11, in relation to a loan undertaken by KBSS from PT Bank Mandiri (Persero)
Tbk. of Rp226.02 billion ($16.4 million) (2014: Rp226.02 billion, $18.2 million). The corporate guarantee remains until the loan is fully settled
Tbk. of Rp226.02 billion ($16.4 million) (2014: Rp226.02 billion, $18.2 million). The corporate guarantee remains until the loan is fully settled
by 23 December 2027. The HGU (land right) that belongs to the Plasma scheme is currently held under SGM’s master title. An application to
by 23 December 2027. The HGU (land right) that belongs to the Plasma scheme is currently held under SGM’s master title. An application to
separate the HGU was submitted to the Land Office and the land will be pledged to the bank as security once the title separation approval is
separate the HGU was submitted to the Land Office and the land will be pledged to the bank as security once the title separation approval is
obtained. In addition, the terms and conditions of the loan agreement require KBSS to sell all the FFB produce to SGM and its plantation
obtained. In addition, the terms and conditions of the loan agreement require KBSS to sell all the FFB produce to SGM and its plantation
estate is to be managed by SGM. In view of these, the Group exposure to this contingent liability is minimised.
estate is to be managed by SGM. In view of these, the Group exposure to this contingent liability is minimised.
23 Disclosure of financial instruments and other risks
23 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
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.
from local partners in respect of their investments.
The Group’s accounting classification of each class of financial asset and liability at 31 December 2015 and 2014 were:
The Group’s accounting classification of each class of financial asset and liability at 31 December 2015 and 2014 were:
2015
2015
Non-current receivables
Non-current receivables
Trade and other receivables
Trade and other receivables
Cash and cash equivalent
Cash and cash equivalent
Borrowings due within one year
Borrowings due within one year
Trade and other payables
Trade and other payables
Borrowings due after one year
Borrowings due after one year
2014
2014
Non-current receivables
Non-current receivables
Trade and other receivables
Trade and other receivables
Cash and cash equivalent
Cash and cash equivalent
Borrowings due within one year
Borrowings due within one year
Trade and other payables
Trade and other payables
Borrowings due after one year
Borrowings due after one year
Loans and
Loans and
receivables
receivables
$000
$000
3,655
3,655
4,704
4,704
104,614
104,614
-
-
-
-
-
-
112,973
112,973
Loans and
Loans and
receivables
receivables
$000
$000
3,007
3,007
8,807
8,807
125,937
125,937
-
-
-
-
-
-
137,751
137,751
Financial
Financial
liabilities at
liabilities at
amortised cost
amortised cost
$000
$000
Total carrying
Total carrying
value
value
$000
$000
-
-
-
-
-
-
(1,750)
(1,750)
(17,406)
(17,406)
(32,875)
(32,875)
(52,031)
(52,031)
3,655
3,655
4,704
4,704
104,614
104,614
(1,750)
(1,750)
(17,406)
(17,406)
(32,875)
(32,875)
60,942
60,942
Financial
Financial
liabilities at
liabilities at
amortised cost
amortised cost
$000
$000
Total carrying
Total carrying
value
value
$000
$000
-
-
-
-
-
-
(313)
(313)
(21,010)
(21,010)
(34,625)
(34,625)
(55,948)
(55,948)
3,007
3,007
8,807
8,807
125,937
125,937
(313)
(313)
(21,010)
(21,010)
(34,625)
(34,625)
81,803
81,803
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
86
86
86
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
23 Disclosure of financial instruments and other risks - continued
Financial instruments not measured at fair value
Financial instruments not measured at fair value includes cash and cash equivalents, trade and other receivables, trade and other payables,
and borrowings due within one year.
Due to their short-term nature, the carrying value of cash and cash equivalents, trade and other receivables, trade and other payables
approximates their fair value.
Please refer to the applicable notes for details of the fair value hierarchy, valuation techniques, and significant unobservable inputs related to
determining the fair value of the following items:
- Non-current receivables (note 11); and
- Loans and borrowings (note 14).
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.
Currency risk
Most of the Group's operations are in Indonesia. The Company and Group accounts are prepared in US Dollar 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 $67,591,000 (2014: $68,042,000), while the fair value of the Group's share of underlying assets at 31 December 2015 amounted to
$399,070,000 (2014: $457,002,000).
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.
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 US Dollar terms and vice versa.
The Group's subsidiaries which are borrowing in US Dollar, 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 to some extent by US Dollar denominated cash
balances in those subsidiaries. The Company will continue to partially match US Dollar cash balances with US Dollar financial liabilities. The
average interest rate on local currency deposits was 7.47% higher than on US Dollar deposits whereas interest rate for local currency
borrowing was about 6.65% higher as compared to US Dollar borrowing. The unmatched balance at 31 December 2015 is represented by
the $26,397,000 shown in the table below (2014: $20,250,000). If the Group's net cash position continues to improve then US Dollar cash
balances will continue to increase through 2016.
The table below shows the net monetary assets and liabilities of the Group at 31 December 2015 and 2014 that were not denominated in the
operating or functional currency of the operating unit involved.
Functional currency of Group operation
2015
Indonesian Rupiah
US Dollar
Total
2014
Indonesian Rupiah
US Dollar
Total
Net foreign currency assets/(liabilities)
US Dollar
$000
Sterling
$000
(26,397)
-
(26,397)
(20,250)
-
(20,250)
-
117
117
-
98
98
Total
$000
(26,397)
117
(26,280)
(20,250)
98
(20,152)
Annual Report 2015 | Anglo-Eastern Plantations Plc
87
87
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
23 Disclosure of financial instruments and other risks - continued
The following table summarises the sensitivity of the Group’s financial assets and financial liabilities to foreign exchange risk. The impact on
profit before tax and equity if Ringgit or Rupiah strengthen or weaken by 10% against US Dollar is:
2015
2014
Carrying
Amount
US$
$000
-10% in
Rp : $ and
RM : $
$000
+10% in
Rp : $ and
RM : $
$000
Carrying
Amount
US$
$000
-10% in
Rp : $ and
RM : $
$000
+10% in
Rp : $ and
RM : $
$000
3,655
4,704
104,614
(1,750)
(17,406)
(32,875)
(224)
(246)
(9,410)
-
1,458
-
(8,422)
274
300
11,502
-
(1,782)
-
10,294
3,007
8,807
125,937
(313)
(21,010)
(34,625)
(165)
(618)
(11,351)
-
1,770
-
(10,364)
202
756
13,873
-
(2,164)
-
12,667
Financial Assets
Non-current receivables
Trade and other receivables
Cash and cash equivalents
Financial Liabilities
Borrowings due within one year
Trade and other payables
Borrowings due after one year
Total increase / (decrease)
Liquidity risk
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 development period and the cash requirement is 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 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 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 2015 the Group had the following loans and
facilities.
Indonesia:
US Dollar denominated – long term loan
34,625
45,000
2016 – 2020 (note 14)
Borrowings
$000
Facilities
$000
Repayable
The total loan borrowings together with interest at current rates is as follows:
Principal
Interest
Total
2015
$000
34,625
6,140
40,765
2014
$000
34,938
8,134
43,072
Forecasts prepared in December 2015 indicate that the Group has sufficient funds to meet its development plans and financial commitments
through 2016.
All the long term loans include varying covenants covering minimum net worth and cash balances, dividend and interest cover and debt
service ratios. The subsidiary companies concerned have complied with the covenants as stated in the loan agreement.
Annual Report 2015 | Anglo-Eastern Plantations Plc
88
88
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
23 Disclosure of financial instruments and other risks - continued
Interest rate risk
Both the Group's surplus cash and its borrowings are subject to variable interest rates. The Group had net cash throughout 2015, 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 Group’s reported results as shown in table below. The rates on borrowings are set out in note 14.
Financial Assets
Cash and cash equivalents
Financial Liabilities
Borrowings due within one year
Borrowings due after one year
Total increase / (decrease)
2015
2014
Carrying
amount
$000
-1% in
interest rate
$000
+1% in
interest rate
$000
Carrying
amount
$000
-1% in
interest rate
$000
+1% in
interest rate
$000
104,614
(797)
857
125,937
(906)
1,053
(1,750)
(32,875)
-
346
(451)
-
(346)
511
(313)
(34,625)
-
349
(557)
-
(349)
704
There is no policy to hedge interest rates, partly because of the net cash position and because the net interest is relatively small proportion of
the Group profits.
Interest rate profiles of the Group's financial assets (comprising non-current receivables, trade and other receivables and cash) at 31
December were:
2015
Sterling
US Dollar
Rupiah
Ringgit
Total
2014
Sterling
US Dollar
Rupiah
Ringgit
Total
Total
$000
Fixed rate
$000
Variable rate
$000
No interest
$000
117
11,423
97,790
3,643
112,973
98
18,869
112,505
6,279
137,751
-
1,193
-
-
1,193
-
1,193
-
-
1,193
22
6,108
76,202
3,361
85,693
24
14,785
84,506
5,974
105,289
95
4,122
21,588
282
26,087
74
2,891
27,999
305
31,269
Long term receivables of $1,193,000 (2014: $1,193,000) comprise US Dollar denominated amounts due from minority shareholders as
described in note 11 on which interest is due at a fixed rate of 6%.
Average US Dollar deposit rate in 2015 was 1.50% (2014: 3.02%) and Rupiah deposit rate was 8.97% (2014: 9.18%).
Interest rate profiles of the Group's financial liabilities (comprising bank loans and other financial liabilities and trade and other payables) at
31 December were:
2015
Sterling
US Dollar
Rupiah
Ringgit
Total
2014
Sterling
US Dollar
Rupiah
Ringgit
Total
Total
$000
Fixed rate
$000
Variable rate
$000
No interest
$000
-
(35,861)
(15,903)
(267)
(52,031)
-
(36,338)
(19,100)
(510)
(55,948)
-
-
-
-
-
-
-
-
-
-
-
(34,625)
-
-
(34,625)
-
(34,938)
-
-
(34,938)
-
(1,236)
(15,903)
(267)
(17,406)
-
(1,400)
(19,100)
(510)
(21,010)
Annual Report 2015 | Anglo-Eastern Plantations Plc
89
89
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
23 Disclosure of financial instruments and other risks - continued
Weighted average interest rate on variable rate borrowings was 5.70% in 2015 (2014: 5.71%).
Credit risk
Sales of CPO and kernel 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 2015 (2014: 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 $1,193,000 (2014: $1,193,000), 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.
Amount receivable due from cooperatives under Plasma scheme as disclosed in note 11, are unsecured and are to be repaid from FFB
supplied by the cooperatives. A subsidiary company has provided a corporate guarantee for one of the cooperatives in obtaining a bank loan
in 2013. The amount drawdown from this loan was used to repay the advances made by the subsidiary. See note 22.
Capital
The Group defines its Capital as Share capital and Reserves, shown in the statement of financial position as "Issued capital attributable to
owners of the parent" and amounting to $369,351,000 at 31 December 2015 (2014: $427,236,000).
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.
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 2015 (2014: Nil) the Group had no net borrowings but, depending market conditions, the Board is prepared for the Group to have
net borrowings.
Plantation industry risk
Please refer to pages 20 - 25.
Annual Report 2015 | Anglo-Eastern Plantations Plc
90
90
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Consolidated Financial Statements
24 Subsidiary companies
The principal subsidiaries of the Company all of which have been included in these consolidated financial statements are as follows:
Country of
incorporation and
principal place of
business
Proportion of
ownership interest at
31 December
Non-controlling
interests ownership /
voting interest at 31
December
2015
2014
2015
2014
Name
Principal sub-holding company
Anglo-Indonesian Oil Palms Limited
Management company
Indopalm Services Limited
Operating companies
Anglo-Eastern Plantations (M) Sdn Bhd
Anglo-Eastern Plantations Management Sdn Bhd
PT Alno Agro Utama
PT Anak Tasik
PT Bangka Malindo Lestari
PT Bina Pitri Jaya
PT Cahaya Pelita Andhika
PT Empat Lawang Agro Perkasa
PT Hijau Pryan Perdana
PT Kahayan Agro Plantation
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
PT Anglo-Eastern Plantations Management
Indonesia
Dormant companies
United Kingdom
100%
100%
United Kingdom
100%
100%
Malaysia
Malaysia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
Indonesia
55%
100%
90%
100%
95%
80%
90%
95%
80%
95%
95%
90%
75%
95%
82%
100%
80%
75%
100%
55%
100%
90%
100%
95%
80%
90%
95%
80%
95%
95%
90%
75%
95%
82%
100%
80%
75%
100%
-
-
45%
-
10%
-
5%
20%
10%
5%
20%
5%
5%
10%
25%
5%
18%
-
20%
25%
-
-
-
-
-
-
-
45%
-
10%
-
5%
20%
10%
5%
20%
5%
5%
10%
25%
5%
18%
-
20%
25%
-
-
-
-
-
The Ampat (Sumatra) Rubber Estate (1913)
United Kingdom
100%
100%
Limited
Gadek Indonesia (1975) Limited
Mergeset (1980) Limited
Musam Indonesia Limited
United Kingdom
United Kingdom
United Kingdom
100%
100%
100%
100%
100%
100%
The principal United Kingdom sub-holding company, UK management company and UK dormant companies are registered in England and
Wales and are direct subsidiaries of the Company. 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.
Annual Report 2015 | Anglo-Eastern Plantations Plc
91
91
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Company Balance Sheet
As at 31 December 2015
Fixed assets
Investments in subsidiaries
Current assets
Debtors
Cash at bank and in hand
Creditors: amount falling due within one year
Net current (liabilities) / assets
Net assets
Capital and reserves
Share capital
Treasury shares
Share premium
Capital redemption reserve
Exchange reserve
Retained earnings
Shareholders' funds
Note
3
4
5
6
6
2015
$000
67,591
67,591
2,252
1,099
3,351
(3,996)
(645)
66,946
15,504
(1,171)
23,935
1,087
3,872
23,719
66,946
2014
$000
68,042
68,042
4,579
1,079
5,658
(3,974)
1,684
69,726
15,504
(1,171)
23,935
1,087
3,872
26,499
69,726
The financial statements were approved by the Board of Directors and authorised for issue on 26 April 2016 and were signed on its behalf by
Dato’ John Lim Ewe Chuan
Executive Director, Corporate Finance and Corporate Affairs
The accompanying notes are an integral part of this balance sheet.
Annual Report 2015 | Anglo-Eastern Plantations Plc
93
93
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
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About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Company Financial Statements
1 Accounting policies
Basis of preparation
The financial statements have been prepared in accordance with Financial Reporting Standard 100 Application of Financial Reporting
Requirements ("FRS 100") and Financial Reporting Standard 101 Reduced Disclosure Framework ("FRS 101").
Disclosure exemptions adopted
In preparing these financial statements the Company has taken advantage of all disclosure exemptions conferred by FRS 101. Therefore
these financial statements do not include:
•
•
•
•
•
•
certain comparative information as otherwise required by EU endorsed IFRS;
certain disclosures regarding the Company's capital;
a statement of cash flows;
the effect of future accounting standards not yet adopted;
the disclosure of the remuneration of key management personnel; and
disclosure of related party transactions with other wholly owned members of Anglo-Eastern Plantations Plc group of companies.
In addition, and in accordance with FRS 101 further disclosure exemptions have been adopted because equivalent disclosures are included
in the Company's consolidated financial statements. These financial statements do not include certain disclosures in respect of:
•
•
•
Share based payments;
Financial instruments (other than certain disclosures required as a result of recording financial instruments at fair value); or
Fair value measurement (other than certain disclosures required as a result of recording financial instruments at fair value).
Principal accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below. The policies have been
consistently applied to all the years presented, unless otherwise stated.
Basis of accounting
The separate financial statements of the Company are presented as required by the Companies Act 2006. They have been prepared under
the historical costs. The presentation currency used is US Dollar and amounts have been presented in round thousands ("$000"). The
principal accounting policies are summarised below.
First time application of FRS 100 and 101
In the current year the Company has adopted FRS 100 and FRS 101. In previous years the financial statements were prepared in
accordance with applicable United Kingdom (“UK”) Accounting Standards and law.
This change in the basis of preparation has not materially altered the recognition and measurement requirements previously applied in
accordance with UK Accounting Standards. Consequently the principal accounting policies are unchanged from the prior year. The change in
basis of preparation has enabled the Company to take advantage of all of the available disclosure exemptions permitted by FRS 101 in the
financial statements, the most significant of which are summarised above. There have been no other material amendments to the disclosure
requirements previously applied in accordance with UK Accounting Standards.
Foreign currency
The functional currency of the Company is US Dollar, chosen because the prices of the bulk of the Group’s products are ultimately
denominated in US Dollar. Transactions in sterling are translated to US Dollar at the actual exchange rate and exchange losses recognised
in profit and loss. Sterling denominated assets and liabilities are converted to US Dollar at the rate ruling at the balance sheet date.
Exchange differences arising on the retranslation of unsettled monetary assets and liabilities are recognised immediately in profit or loss.
Investments
Investments in subsidiaries are stated at cost less provision for any permanent diminution in value.
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.
Share based payments
As set out under Group accounting policies on page 66.
Deferred taxation
A deferred tax asset has not been recognised in relation to brought forward tax losses of $9.5m (2014: $8.6m) because it is not certain those
losses can be utilised in the foreseeable future.
Annual Report 2015 | Anglo-Eastern Plantations Plc
95
95
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Company Financial Statements
1 Accounting policies - continued
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 Profit and loss account
As permitted by section 408 of the Companies Act 2006, a separate profit and loss account dealing with the results of the Company has not
been presented. The loss before tax for the year for the Company dealt with in the consolidated financial statements of the Company was
$906,000 (2014: $100,000) and loss after tax for the year was $911,000 (2014: $104,000).
The remuneration of the directors of the Company is disclosed in note 6 to the group financial statements. Auditor's remuneration is
disclosed in to note 4 to the group financial statements.
3
Investments in subsidiaries
At 1 January 2014
Movements during the year
At 31 December 2014
Movements during the year
At 31 December 2015
Net carrying amount
At 31 December
Investments in
subsidiary
undertakings
$000
Loans to
subsidiary
undertakings
$000
874
1,936
2,810
-
2,810
65,022
210
65,232
(451)
64,781
2015
$000
Total
$000
65,896
2,146
68,042
(451)
67,591
2014
$000
67,591
68,042
Loans to 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 holding of preference shares in a subsidiary of $6.146m was due for full redemption in January 2012. On 15 January 2014, the
shareholders of the subsidiary at EGM voted in favour of a capital reduction of its preference shares to enable partial redemption. A court
order was obtained on 5 June 2014 allowing the partial redemption of $4.210m as proposed by the shareholders. The balance preference
shares of $1.936m were extended to year 2017 with the terms and conditions remain unchanged.
The following subsidiary undertakings are directly held by the Company.
Directly held
Anglo-Indonesian Oil Palms Limited
Indopalm Services Limited
Anglo-Eastern Plantations (M) Sdn Bhd
Anglo-Eastern Plantations Management Sdn Bhd
Proportion of voting
rights and shares held Nature of business
Investment holding
100%
100% Management service
55% Plantation agriculture
100% Management service
Annual Report 2015 | Anglo-Eastern Plantations Plc
96
96
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Company Financial Statements
3
Investments in subsidiaries - continued
The following were subsidiaries undertakings at the end of the year of AEP Plc and have been included in the consolidated financial
statements.
Indirectly held
PT Alno Agro Utama
PT Anak Tasik
PT Bangka Malindo Lestari
PT Bina Pitri Jaya
PT Cahaya Pelita Andhika
PT Empat Lawang Agro Perkasa
PT Hijau Pryan Perdana
PT Kahayan Agro Plantation
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
PT Anglo-Eastern Plantations Management Indonesia
The Ampat (Sumatra) Rubber Estate (1913) Limited
Gadek Indonesia (1975) Limited
Mergeset (1980) Limited
Musam Indonesia Limited
4 Debtors
Amounts owed by group undertakings:
Anglo-Eastern Plantations Management Sdn Bhd
Anglo-Eastern Plantations (M) Sdn Bhd
Other debtors
Proportion of voting
rights and shares held Nature of business
90% Plantation agriculture
100% Plantation agriculture
95% Plantation agriculture
80% Plantation agriculture
90% Plantation agriculture
95% Plantation agriculture
80% Plantation agriculture
95% Plantation agriculture
95% Plantation agriculture
90% Plantation agriculture
75% Plantation agriculture
95% Plantation agriculture
82% Plantation agriculture
100% Plantation agriculture
80% Plantation agriculture
75% Plantation agriculture
100% Management service
100%
100%
100%
100%
Investment holding
Investment holding
Investment holding
Investment holding
2015
$000
1,930
305
2,235
17
2,252
2014
$000
4,183
374
4,557
22
4,579
The amounts owed by group undertakings arise as a result of advances to subsidiary companies and expenses paid on their behalf. The
amounts are unsecured, interest free and do not have fixed repayment terms.
5 Creditors: amounts falling due within one year
Amounts owed to group undertakings
Mergeset (1980) Limited
Musam Indonesia Limited
PT Musam Utjing
PT Tasik Raja
Accruals
2015
$000
2,163
246
121
230
2,760
1,236
3,996
2014
$000
1,857
142
121
455
2,575
1,399
3,974
The amounts owed to group undertakings arise as a result of advances from subsidiary companies and expenses paid on our behalf. The
amounts are unsecured, interest free and do not have fixed repayment terms.
Annual Report 2015 | Anglo-Eastern Plantations Plc
97
97
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Company Financial Statements
Notes to the Company Financial Statements
Notes to the Company Financial Statements
6 Share capital and treasury shares
6 Share capital and treasury shares
6 Share capital and treasury shares
Ordinary shares of 25p each
Ordinary shares of 25p each
Ordinary shares of 25p each
Beginning and end of year
Beginning and end of year
Beginning and end of year
Treasury shares:
Treasury shares:
Treasury shares:
Beginning of year
Beginning of year
Beginning of year
Share options exercised
Share options exercised
Share options exercised
End of year
End of year
End of year
Market value of treasury shares:
Market value of treasury shares:
Market value of treasury shares:
Beginning of year (555.0p/share)
Beginning of year (555.0p/share)
Beginning of year (555.0p/share)
End of year (531.0p/share)
End of year (531.0p/share)
End of year (531.0p/share)
7 Related party transactions
7 Related party transactions
7 Related party transactions
Authorised
Authorised
Authorised
Number
Number
Number
60,000,000
60,000,000
60,000,000
Issued and
Issued and
Issued and
fully paid
fully paid
fully paid
£000
£000
£000
9,994
9,994
9,994
Issued and
Issued and
Issued and
fully paid
fully paid
fully paid
Number
Number
Number
39,976,272
39,976,272
39,976,272
2015
2015
2015
Number
Number
Number
339,900
339,900
339,900
-
-
-
339,900
339,900
339,900
Authorised
Authorised
Authorised
£000
£000
£000
15,000
15,000
15,000
2014
2014
2014
Number
Number
Number
339,900
339,900
339,900
-
-
-
339,900
339,900
339,900
Authorised
Authorised
Authorised
$000
$000
$000
23,865
23,865
23,865
Cost
Cost
Cost
2015
2015
2015
$’000
$’000
$’000
(1,171)
(1,171)
(1,171)
-
-
-
(1,171)
(1,171)
(1,171)
Issued and
Issued and
Issued and
fully paid
fully paid
fully paid
$000
$000
$000
15,504
15,504
15,504
Cost
Cost
Cost
2014
2014
2014
$’000
$’000
$’000
(1,171)
(1,171)
(1,171)
-
-
-
(1,171)
(1,171)
(1,171)
$’000
$’000
$’000
2,942
2,942
2,942
2,675
2,675
2,675
During the year the Company engaged UHY Hacker Young, an accounting firm of which Dato’ John Lim Ewe Chuan is a partner, to provide
During the year the Company engaged UHY Hacker Young, an accounting firm of which Dato’ John Lim Ewe Chuan is a partner, to provide
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 $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
company secretarial and taxation services for a fee of $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
company secretarial and taxation services for a fee of $28,978 (2014: $23,548). This contract is on an arm’s length basis. The balance
outstanding at year end was $3,057 (2014: $3,483).
outstanding at year end was $3,057 (2014: $3,483).
outstanding at year end was $3,057 (2014: $3,483).
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
An office premises lease agreement was entered with Infra Sari Sdn Bhd, a company controlled by Madam Lim Siew Kim. The rental paid
during the year was $227,318 (2014: $235,863). There was no balance outstanding at year end (2014: Nil).
during the year was $227,318 (2014: $235,863). There was no balance outstanding at year end (2014: Nil).
during the year was $227,318 (2014: $235,863). There was no balance outstanding at year end (2014: Nil).
Transactions between the Company and its subsidiaries are disclosed below:
Transactions between the Company and its subsidiaries are disclosed below:
Transactions between the Company and its subsidiaries are disclosed below:
Nature of transactions
Nature of transactions
Nature of transactions
Management fees from
Management fees from
Management fees from
Corporate guarantee fees from
Corporate guarantee fees from
Corporate guarantee fees from
Corporate guarantee fees from
Corporate guarantee fees from
Corporate guarantee fees from
Receivable from
Receivable from
Receivable from
Payable to
Payable to
Payable to
The details of the intercompany receivables and payables are disclosed in note 4 and note 5 of the Company financial statements
The details of the intercompany receivables and payables are disclosed in note 4 and note 5 of the Company financial statements
The details of the intercompany receivables and payables are disclosed in note 4 and note 5 of the Company financial statements
respectively.
respectively.
respectively.
Name
Name
Name
Anglo-Eastern Plantations Malaysia Sdn Bhd
Anglo-Eastern Plantations Malaysia Sdn Bhd
Anglo-Eastern Plantations Malaysia Sdn Bhd
PT Hijau Pryan Perdana
PT Hijau Pryan Perdana
PT Hijau Pryan Perdana
PT Sawit Graha Manunggal
PT Sawit Graha Manunggal
PT Sawit Graha Manunggal
Subsidiaries (note 4)
Subsidiaries (note 4)
Subsidiaries (note 4)
Subsidiaries (note 5)
Subsidiaries (note 5)
Subsidiaries (note 5)
2014
2014
2014
$000
$000
$000
69
69
69
50
50
50
175
175
175
4,557
4,557
4,557
2,575
2,575
2,575
2015
2015
2015
$000
$000
$000
57
57
57
50
50
50
175
175
175
2,235
2,235
2,235
2,760
2,760
2,760
8 Employees' and Directors' remuneration
8 Employees' and Directors' remuneration
8 Employees' and Directors' remuneration
Average numbers employed during the year
Average numbers employed during the year
Average numbers employed during the year
- directors
- directors
- directors
- staff
- staff
- staff
Staff costs
Staff costs
Staff costs
Wages and salaries
Wages and salaries
Wages and salaries
Social security costs
Social security costs
Social security costs
2015
2015
2015
Number
Number
Number
4
4
4
-
-
-
4
4
4
2015
2015
2015
$000
$000
$000
-
-
-
-
-
-
-
-
-
2014
2014
2014
Number
Number
Number
4
4
4
-
-
-
4
4
4
2014
2014
2014
$000
$000
$000
-
-
-
-
-
-
-
-
-
The information required by the Companies Act and the Listing Rules of the Financial Conduct Authority is contained in the Directors'
The information required by the Companies Act and the Listing Rules of the Financial Conduct Authority is contained in the Directors'
The information required by the Companies Act and the Listing Rules of the Financial Conduct Authority is contained in the Directors'
remuneration report on pages 47 - 51 of which certain information on pages 50 - 51 has been audited.
remuneration report on pages 47 - 51 of which certain information on pages 50 - 51 has been audited.
remuneration report on pages 47 - 51 of which certain information on pages 50 - 51 has been audited.
Directors' emoluments
Directors' emoluments
Directors' emoluments
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
2015
2015
2015
$000
$000
$000
240
240
240
2014
2014
2014
$000
$000
$000
248
248
248
98
98
98
98
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notes to the Company Financial Statements
9 Dividends
Paid during the year
Final dividend of 3.0p per ordinary share for the year ended 31 December 2014
(2013: 3.0p)
Proposed final dividend of 1.75p per ordinary share for the year ended 31 December 2015
(2014: 3.0p)
2015
$000
1,869
1,028
2014
$000
1,998
1,854
The proposed dividend for 2015 is subject to shareholder approval at the forthcoming annual general meeting and has not been included as
a liability in these financial statements.
10 Guarantees and other financial commitments
The Company has provided guarantees for loans to subsidiaries totalling $45,000,000 (2014: $45,000,000) as set out in note 14 of the
consolidated financial statements.
11 First time adoption of FRS 101 Reduced Disclosure Framework
This is the first time that the Company has adopted FRS 101 having previously applied applicable UK Accounting Standards. The date of
transition to FRS 101 was 1 January 2015. In applying FRS 101 for the first time the Company has elected to retain the cost of investment in
subsidiary undertakings at their carrying amounts under applicable UK Accounting Standards.
There is no effect on the Company’s equity and total comprehensive income of applying FRS 101 for the first time.
Annual Report 2015 | Anglo-Eastern Plantations Plc
99
99
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice of Annual General Meeting
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Notice is hereby given that the thirty-first Annual General Meeting of Anglo-Eastern Plantations Plc will be held at the offices of UHY Hacker
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
Young LLP, Quadrant House, 4 Thomas More Square, London E1W 1YW on Monday 27 June 2016 at 11.00 a.m. for the following purposes:
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To receive and consider the accounts and the reports of the directors and auditors thereon for the year ended 31 December 2015.
1
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
To approve the Directors' Remuneration Report as set out in the Company’s annual report and accounts for the year ended 31 December
2
2015.
2015.
2015.
2015.
2015.
2015.
2015.
2015.
2015.
2015.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To declare a final dividend.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Madam Lim Siew Kim, a Non-Executive Director, who has served more than nine years.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Jonathan Law Ngee Song as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Dato’ John Lim Ewe Chuan as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-elect Lim Tian Huat as a director.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To re-appoint BDO LLP as auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
To authorise the directors to fix the remuneration of the auditors.
3
3
3
3
3
3
3
3
3
3
4
4
4
4
4
4
4
4
4
4
5
5
5
5
5
5
5
5
5
5
6
6
6
6
6
6
6
6
6
6
7
7
7
7
7
7
7
7
7
7
8
8
8
8
8
8
8
8
8
8
9
9
9
9
9
9
9
9
9
9
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
10 To consider the following resolution as a special resolution:
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
That the directors be generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006, in substitution for
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
all existing authorities to the extent unused, to exercise all the powers of the Company to allot:
(i)
(i)
(i)
(i)
(i)
(i)
(i)
(i)
(i)
(i)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
shares in the Company up to an aggregate nominal amount of £3,303,031 (representing 13,212,124 ordinary shares of 25p each)
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
which is equal to one third of the issued ordinary share capital (excluding treasury shares) at the date of this resolution: and in
addition
addition
addition
addition
addition
addition
addition
addition
addition
addition
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
equity securities of the Company (within the meaning of section 560(1) of the Companies Act 2006) in connection with an offer of
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
such securities by way of a rights issue up to an aggregate nominal amount of £3,303,031
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
(ii)
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
provided that this authority shall expire on the date of the next annual general meeting after the passing of this resolution or 30 June 2017
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
whichever is earlier save that the Company may before such expiry make an offer or agreement which would or might require rel evant
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if the
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
authority conferred hereby had not expired.
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"rights issue" means an offer of equity securities open for acceptance for a period fixed by the directors to holders of equity securities (other
"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
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
than the Company) on the register on a fixed record date in proportion to their respective holdings of such securities or in accordance with
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
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
the rights attached thereto (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient in
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
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
relation to fractional entitlements or legal or practical problems under the laws of, or the requirements of any recognised regulatory body or
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).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
any stock exchange in, any territory).
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
11 To consider the following resolution as a special resolution:
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
That subject to and conditional on the passing of Resolution 10, the directors be empowered pursuant to section 570 of the Companies Act
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
2006) to allot equity securities (within the meaning of section 560 of that Act) for cash pursuant to the authority conferred by Resolution 10
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
and/or by way of sale of treasury shares as if section 561(1) of that Act did not apply to any such allotment or sale, provided that this
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
authorisation shall be limited to:
(i)
(i)
(i)
(i)
(i)
(i)
(i)
(i)
(i)
(i)
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
the allotment of equity securities and sale of treasury shares for cash in connection with an offer or issue of, or invitation to apply for,
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
equity securities made to (but in the case of the authority granted under paragraph (ii) of Resolution 10 by way of a rights issue
only);
only);
only);
only);
only);
only);
only);
only);
only);
only);
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
ordinary shareholders in proportion (as nearly may be practicable) to their existing holdings: and
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
holders of other equity securities, as required by the rights of those securities, or as the directors otherwise consider
necessary,
necessary,
necessary,
necessary,
necessary,
necessary,
necessary,
necessary,
necessary,
necessary,
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
and permitting the directors to impose any limited or restrictions and make any arrangements which they consider necessary or
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
appropriate to deal with treasury shares, fractional entitlement, record dates, legal regulatory or practical problems in, or under, the
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
laws of any territory, or any other matter; and
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
Annual Report 2015 | Anglo-Eastern Plantations Plc
100
100
100
100
100
100
100
100
100
100
100
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notice of Annual General Meeting
(ii)
in the case of the authority granted under paragraph (i) of Resolution 10 and/or the sale of treasury shares for cash, to the allotment
of equity shares or sale of treasury shares up to an aggregate nominal amount of £495,454.
Such power shall apply during the period expiring on the date of the next annual general meeting or on 30 June 2017 (whichever
shall be earlier) but the directors may during such periods make offers or agreements which would or might require equity securities
to be allotted (and treasury shares to be sold) after the expiry of such period.
12 To consider the following as a special resolution:
That the Company be generally and unconditionally authorised to make market purchases (within the meaning of section 693(4) of the
Companies Act 2006) of ordinary shares of 25p each in the capital of the Company on such terms as the directors think fit, provided that:
(a)
the maximum number of ordinary shares hereby authorised to be purchased is 3,963,637 (representing 10% of the issued ordinary
share capital);
(b)
the minimum price (exclusive of expenses) which may be paid for each ordinary share is 25p;
(c)
the maximum price (exclusive of expenses) which may be paid for each ordinary share is the higher of:
(i)
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 for the five business days immediately preceding the date of purchase; and
(ii)
the price of the last independent trade and the highest current independent bid on the London Stock Exchange; and
(d)
the authority hereby conferred shall expire on 30 June 2017 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.
13 To consider and if thought fit to pass the following resolution as a special resolution:
That a general meeting of the Company other than an annual general meeting may be called on not less than 14 clear days’ notice.
By order of the Board
CETC (Nominees) Limited
Company Secretary
26 May 2016
Annual Report 2015 | Anglo-Eastern Plantations Plc
101
101
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notice of Annual General Meeting
Notes:
1.
2.
3.
4.
5.
6.
7.
8.
9.
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 on 23 June 2016 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 23 June 2016 or, if the meeting is adjourned, in the register of members at 6.00 p.m. on the date which
is two days before the day of the adjourned meeting shall be disregarded in determining the rights of any person to attend and vote at the meeting.
As at 26 May 2016 (being the latest practicable date prior to the publication of this notice), the Company’s issued share capital comprised 39,976,272
Ordinary Shares of 25p each. Each share carries one vote except 339,900 shares held as treasury shares and therefore the total number of voting rights in
the Company as at 9.00 am on 26 May 2016 is 39,636,372.
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 the meeting. Where
more than one proxy is appointed in relation to the meeting, each proxy must be appointed to exercise rights attaching to a different share or 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).
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).
CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the annual general
meeting to be held on 27 June 2016 and any adjournment thereof by using the procedures described in the CREST Manual on the Euroclear website
(www.euroclear.com/CREST). CREST personal members or other CREST sponsored members and those CREST members who have appointed a voting
service provider should refer to their CREST sponsor or voting service provider, who will be able to take the appropriate action on their behalf. In order for a
proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a “CREST Proxy Instruction”) must be
properly authenticated in accordance with Euroclear’s specifications and must contain the information required for such instructions, as described in the
CREST Manual. All messages relating to the appointment of a proxy or an instruction to a previously appointed proxy must be transmitted so as to be
received by Capita Registrars [CREST ID: RA10] by 11.00 a.m. on 23 June 2016. It is the responsibility of the CREST member concerned to take such
action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST
members and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual
concerning practical limitations of the CREST system and timings. The Company may treat a CREST Proxy Instruction as invalid in the circumstances set
out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
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.
The statement of the rights of shareholders in relation to the appointment of proxies does not apply to a person who receives this notice of general meeting
as a person nominated to enjoy “information rights” under section 146 of the Companies Act 2006. If you have been sent this notice of meeting because
you are such a nominated person the following statements apply: (i) you may have a right under an agreement between you and t he registered shareholder
by whom you were nominated to be appointed (or to have someone else appointed) as a proxy for this general meeting and (ii) if you have no such a right,
or do not wish to exercise it, you may have a right under such an agreement to give instructions to that registered shareholder as to the exercise of voting
rights. Nominated persons should contact the registered member by whom they were nominated in respect of these arrangements.
A member of the Company which is a corporation may authorise a person or persons to act as its representative(s) at the meeting. In accordance with the
provisions of the Companies Act 2006, each such representative may exercise (on behalf of the corporation) the same powers as the corporation could
exercise if it were an individual member of the Company, provided that they do not do so in relation to the same shares. It is no longer necessary to
nominate a designated corporate representative.
10. Members satisfying the requirements of section 527 of the Companies Act 2006 may require the Company to publish on a website a statement by them (at
the Company’s cost) relating to the audit of the Company’s accounts which are being laid before this meeting (including the auditor’s report and the conduct
of the audit) or, where applicable, any circumstances connected with an auditor of the Company ceasing to hold office since the previous general meeting at
which accounts were laid. Should such a statement be received, it will be published on the Company’s website at www.angloeastern.co.uk. In those
circumstances the Company would be under an obligation to forward a copy of the statement to the auditors forthwith and the statement would form part of
the business which may be dealt with at this meeting.
11.
Any member attending the meeting has the right to ask questions. The Company must cause to be answered any such questions relating to the business
being dealt with at the meeting but no such answer need be given if (a) to do so would interfere unduly with the preparation of the meeting or involve the
disclosure of confidential information, (b) the answer has already been given on a website in the form of an answer to a question, or (c) it is undesirable in
the interests of the Company or the good order of the meeting that the question be answered.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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102
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
Notice of Annual General Meeting
12.
The following documents are available for inspection by members at the registered office of the Company during normal busines s hours (except Bank
Holidays) and at the place of the meeting not less than 15 minutes prior to and during the meeting:
(a) a copy of the Executive Director’s service agreement;
(b)
(c)
(d) a copy of the Company’s Articles of Association.
copies of Non-Executive Directors’ letters of appointment;
relationship agreement with the majority shareholder; and
13.
A copy of this notice and the other information required by section 311A of the Companies Act 2006 can be found at www.angloeastern.co.uk.
14.
15.
If you are in any doubt as to any aspect of Resolutions 10 to 13 or as to the action you should take, you should immediately take your own advice from a
stockbroker, solicitor, accountant or other independent financial advisor 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.
Annual Report 2015 | Anglo-Eastern Plantations Plc
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103
About Anglo-Eastern Plantations Annual Report 2015 | Anglo-Eastern Plantations Plc 2 Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha. AEP has a Premium Listing on the London Stock Exchange. The Company was formed and floated in 1985. Primary activities are the crop production and processing of palm oil and some rubber through operations in Indonesia and Malaysia. The Group is committed to responsible development and management of its plantations and facilities for the benefit of the environment and society in which it operates.
About Anglo-Eastern Plantations
Contents
Anglo-Eastern Plantations Plc (“AEP”) and its subsidiaries (the “Group”) are a major producer of palm oil
and rubber with plantations across Indonesia and Malaysia, amounting to some 128,600ha.
About AEP
Financial Highlights
Key Information
Shareholder Information
Chairman's Statement
Strategic Report
Financial Record
Estate Areas
Location of Estates
Directors' Report
Directors' Responsibilities
Directors
Statement on Corporate Governance
Audit Committee Report
Directors' Remuneration Report
Auditors' Report
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
2
4
6
7
9
11
29
30
31
32
38
39
40
44
47
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59
60
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62
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Company Balance Sheet
Company Statement of Changes in Equity
Notes to the Company Financial Statements
Notice of Annual General Meeting
Form of Proxy and Attendance Card
AEP has a Premium Listing on the London Stock
Exchange. The Company was formed and floated in
1985.
65
63
Primary activities are
the crop production and
processing of palm oil and some rubber through
operations in Indonesia and Malaysia.
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95
93
The Group is committed to responsible development
and management of its plantations and facilities for the
benefit of the environment and society in which it
operates.
Separate Attachment
100
Company addresses, advisers and website
Inside Back Cover
Annual Report 2015 | Anglo-Eastern Plantations Plc
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Company addresses
London Office
Anglo-Eastern Plantations Plc
Quadrant House, 6th Floor
4 Thomas More Square
London E1W 1YW
United Kingdom
Tel: 44 (0)20 7216 4621
Fax: 44 (0)20 7767 2602
Malaysian Office
Anglo-Eastern Plantations Management Sdn Bhd
7th Floor, Wisma Equity
150 Jalan Ampang
50450 Kuala Lumpur
Malaysia
Tel:
60 (0)3 2162 9808
Fax: 60 (0)3 2164 8922
Indonesian Office
PT Anglo-Eastern Plantations Management Indonesia
Wisma HSBC, Jalan Diponegoro, Kav 11
Medan 20152
North Sumatera
Indonesia
Tel: 62 (0)61 452 0107
Fax: 62 (0)61 452 0029
Secretary and registered office
Anglo-Eastern Plantations Plc
(Number 1884630)
(Registered in England and Wales)
CETC (Nominees) Limited
Quadrant House, 6th Floor
4 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
Company advisers
Auditors
BDO LLP
55 Baker Street
London W1U 7EU
United Kingdom
Principal Bankers
National Westminster Bank Plc
15 Bishopsgate
London EC2P 2AP
United Kingdom
The Hong Kong and Shanghai Banking Corporation
Limited
Wisma HSBC
Jalan Diponegoro, Kav 11
Medan 20152
North Sumatera
Indonesia
PT Bank DBS Indonesia
Uniplaza Building
Jalan Letjen MT Haryono A-1
Medan 20231
North Sumatera
Indonesia
RHB Bank Bhd
Podium Block, Plaza OSK
Jalan Ampang
50450 Kuala Lumpur
Malaysia
Registrars
Capita Registrars Ltd
Northern House
Woodsome Park
Fenay Bridge
Huddersfield
West Yorkshire HD8 0GA
United Kingdom
Solicitors
Withers LLP
16 Old Bailey
London EC4M 7EG
United Kingdom
Sponsor/Broker
Panmure Gordon (UK) Limited
One New Change
London EC4M 9AF
United Kingdom
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