2024
Annual Report &
Financial Statements
for the year ended
31 December 2024
Group financial highlights
1
Chairman’s statement
2
Operational highlights
3
Map and locations
6
Market information
8
The Group’s business model
10
Strategic report
Strategy
12
Section 172 statement
13
Results and financial position
14
Operations: Indonesian palm oil
16
Current trading and prospects
26
Operations: Malaysian property
27
Risk management
28
Sustainability
Climate-related financial disclosures
34
Communities
36
Report of the directors
Board of directors
40
Corporate governance
45
Remuneration report
54
Financial statements
Independent auditors’ report
58
Consolidated income statement
64
Consolidated statement of comprehensive income
65
Consolidated balance sheet
66
Consolidated statement of changes in equity
67
Consolidated cash-flow statement
68
Notes to the consolidated accounts
69
Parent company
Parent-company balance sheet
92
Parent-company statement of changes in equity
93
Notes to the parent-company accounts
94
Other information
Subsidiary and associated undertakings
98
Analysis of Indonesian plantation land areas
99
Analysis of Group equity value
100
Five-year summary
101
Notice of meeting
102
Officers, professional advisers & representatives
104
Glossary
104
From the chairman
The Group has achieved record-breaking results for 2024, supported
by a year of tight control over operating costs, alongside favourable
crude-palm-oil pricing. Revenue, profitability and cash generation are
all up substantially on last year. Once again, despite some weather-
related challenges seen across Indonesia, the Group was able to
process 1.6 million tonnes of crop, almost all in the Group’s six
efficiently operated palm-oil mills. All those mills are producing and
selling certified sustainable oil and, for the first time in 2024, the Group produced over
250,000 tonnes of sustainable crude palm oil.
The Group is committed to sustainable growth and is continuing to plant new areas
on its estates in Sumatra and East Kalimantan. In addition, the Group has a strong
balance sheet, with net funds of almost US$50 million, supporting its strategy to
acquire further planted areas near to the Group’s existing estates and mills.
Earnings per share increased in the year to 129.6p, and the board is recommending a
final dividend of 37.5p, bringing the total for the year to 52.5p. This is a 17% increase
on the previous year as the Group continues its long-held approach to progressive
shareholder returns.
Peter Hadsley-Chaplin
Contents
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
M.P. Evans is a responsible producer
of sustainable Indonesian palm oil,
striving for excellence in all the Group’s
operations, with a focus on continuing
growth and offering an increasing yield.
Group financial highlights
For the year ended 31 December 2024
Operating
cash
generated
48%
increase
2024 US$152.6m
2023 US$103.1m
Basic
earnings
per share
66%
increase
2024 129.6 pence
2023 78.1 pence
Normal
dividend
per share
17%
increase
2024 52.5 pence
2023 45.0 pence
Revenue
15%
increase
2024 US$352.8m
2023 US$307.4m
Mill-gate
CPO price
13%
increase
2024 US$823 per tonne
2023 US$729 per tonne
Gross
profit
49%
increase
2024 US$116.6m
2023 US$78.5m
Net cash
surplus
No net
gearing
2024 net cash US$46.4m
2023 net debt US$14.8m
Cost per
tonne
4%
decrease
2024 US$410
2023 US$427
Profit for
the year
61%
increase
2024 US$90.6m
2023 US$56.4m
1
2024 and are available on the Group’s website, setting
out in detail our approach to carbon reduction and on
broader environmental, social and governance (“ESG”)
matters. In this annual report, we provide an updated
2024 carbon balance sheet, demonstrating that we are
on track, for both the interim and long term, to achieve
our overall carbon-reduction target. We are reviewed by
the Zoological Society of London for the quality of our
disclosures on ESG, and received a further increase in
their 2024 ‘SPOTT’ rating, up to 88.9%.
The Group achieved a gross profit of
US$116.6 million in 2024, almost 50%
higher than in the previous year, and an
all-time record.
Earnings per share were 129.6p, significantly higher than
the 78.1p recorded in 2023. The high-price environment
benefited the Group during the year, most notably in the
second half, along with lower operating costs, including
from a continued reduction in fertiliser costs. The Group
generated a large amount of operating cash, with net
operating cash inflows of US$135.8 million (2023 —
US$79.7 million). This was put to good use in returning
funds to shareholders, continued capital investment, and
eliminating Group net debt. At the end of the year, the
Group had net funds of US$46.4 million (2023 net debt of
US$14.8 million).
DIVIDEND
An interim dividend of 15p per share (2023 — 12.5p per
share) was paid on 1 November 2024 and the board is
recommending a final dividend of 37.5p per share
(2023 — 32.5p per share). The total figure of 52.5p per
share (2023 — 45p per share) represents an increase in
the annual dividend of 17% and is another step
forward in the Group’s progressive dividend policy. The
Group is proud of its track record, stretching back for
more than thirty years, of maintaining or increasing
normal dividends.
This further, significant, increase in dividend distributions
reflects both the step up in profitability achieved in 2024
and the board’s continuing confidence in the long-term
prospects for the Group. Whilst crop and production
in 2024 were similar to the previous year, the Group’s
ongoing ability to generate substantial cash inflows forms
a sound basis for both shareholder returns and further
investment for the future.
RESULTS
The Group achieved a gross profit of US$116.6 million in
2024, almost 50% higher than in the previous year, and an
all-time record. This was, in the main, a reflection of the
higher crude-palm-oil (“CPO”) price, at US$823 per tonne
mill-gate, 13% higher than last year, combined with an
ongoing focus on maintaining control over operational
costs. In addition, the Group harvested 2% more crop
from its own areas and those managed on behalf of its
associated scheme smallholders during the year, whilst
the total crop processed by the Group remained the same
as last year at 1.6 million tonnes.
Almost all the Group’s crop was processed in its own
facilities, with six mills in operation for the whole year.
All mills were certified to produce sustainable palm
oil throughout the year with, in addition, all but one
having received accreditation from the Roundtable on
Sustainable Palm Oil (“RSPO”) by the end of 2024. As a
result of the increase in sustainable production facilities,
the Group produced more than 250,000 tonnes of
certified sustainable CPO for the first time, representing
almost 70% of its total output of 372,200 tonnes.
The Group’s commitment to responsible operation is as
strong as ever. Two new reports were published during
The Group operated six palm-oil
mills throughout 2024 with total crop
processed of 1.6 million tonnes.
A combination of efficient operations
and strong pricing resulted in record
profitability, and earnings per share
of 129.6p.
Peter Hadsley-Chaplin
Chairman
Chairman’s statement
2
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
2
CHAIRMAN’S STATEMENT
Operational highlights
• Total crop processed
maintained at
1.6 million tonnes
• Six certified palm-oil mills in
operation throughout year
processing almost all (96%)
of total crop processed
• Further increase in certified
sustainable CPO, up to
257,000 tonnes
• Acquisition of minority interest
in Group estates during year
increasing effective ownership
by 1,700 hectares
• Planting continuing at
Musi Rawas, as total area
approaches 11,000 hectares,
and planting programme
started at recently acquired
estate at Kota Bangun
• Increase in conservation
hectarage, particularly
mangrove forest at Bumi Mas,
and conservation area now
12% of planted land
SHARE BUYBACK
Over the course of 2024, the Group maintained its
share-buyback programme and, by the end of the year,
had deployed US$13.4 million (2023 — US$9.7 million)
to purchase, and subsequently cancel, 1,183,398 (2023 —
991,198) of the Company’s 10p shares. This represented
2.2% (2023 — 1.8%) of the issued share capital. The
buyback programme serves to enhance earnings per
share and the shareholder authorisation for it continues
until the next annual general meeting.
OPERATIONAL DEVELOPMENTS
The total crop processed by the Group was almost the
same as for the previous year, at 1.6 million tonnes.
This was made up of a 2% increase in crop from Group-
owned areas to 937,000 tonnes (2023 — 922,900 tonnes),
and a 3% increase from associated smallholders to
285,900 tonnes (2023 — 278,500 tonnes), offset by an 8%
decrease in crop purchased from independent suppliers
to 386,000 tonnes (2023 — 421,500 tonnes). The increase
in crops harvested from the areas managed by the Group
reflected, in part, the larger areas managed during the
year following the acquisitions made in the previous year.
However, it must also be seen within the context of some
challenging conditions across Indonesia as a whole in
2024, following a particularly dry period in the latter part
of the preceding year. As a result, whilst it is difficult to
obtain accurate data, it appears the country as a whole
has reported a decrease in total crop, making the Group’s
overall harvest a commendable result. The reduction
in purchased crop reflects the increased competition
for crop in some local markets, and the Group’s
unwillingness to pay high prices for what is, at times, poor
quality input, emphasising the importance of the longer-
term strategy to reduce reliance on outside suppliers.
An interim dividend of 15p per share
was paid on 1 November 2024 and the
board is recommending a final dividend
of 37.5p per share.
The performance of the Group’s Kota Bangun estate was
particularly encouraging in 2024. It is now being run as
a combined project, having taken both estates acquired
in the latter part of 2023, ABK and Nusantara, under
its management. Initially, it had been expected that
Nusantara would operate separately and would supply
its crop to a third-party mill but, during 2024, it became
clear that Nusantara can be run as a ‘satellite’ estate of
the Kota Bangun project, as ABK already was, and can
3
send its crop to one of the mills there for processing. This
approach is now well established, and the management
of Nusantara is, like ABK, part of Kota Bangun. The crop
from ABK and Nusantara has helped to increase the total
Kota Bangun harvest by 11% during 2024.
Whilst not quite as elevated as the particularly high
figures secured in 2023, the average extraction rate
achieved in the Group’s mills remained at a strong level,
at 23.2% (2023 — 23.4%). In part, the small reduction may
have been caused by climatic factors during the year, but
the Group’s estate and mill teams will continue to work
together to ensure that crop is harvested at the right
time, delivered to the mill efficiently, and that the mill
works to minimise oil losses and maximise oil extraction.
The average extraction rate achieved
in the Group’s mills remained at a
strong level, at 23.2%.
By the end of the year, the Group managed over 66,000
planted hectares of oil palm, for itself and for its
associated scheme smallholders, and was continuing
to plant further hectarage, both in Sumatra and in
East Kalimantan. Whilst the yield per mature hectare
reduced in the year from 23 tonnes to 21 tonnes, most
of this reduction was as a result of the inclusion of the
hectarage acquired in 2023 for the first full year in 2024,
with a smaller part due to the impact of the dry weather
towards the end of 2023. The Group expects to see an
increase in yield per hectare as conditions improve, and
as the more recently acquired estates continue to work
towards the high standards of the rest of the Group.
STRATEGIC DEVELOPMENTS
With six mills in operation throughout the year for the
first time, the focus is now on maximising their profitable
utilisation and continued operational excellence. The
Group achieved the highest ever mill throughput of
Group-harvested crop during 2024, and its strategy
is to continue increasing utilisation from the Group’s
own areas. The Group makes better margins from its
own harvest than from purchased fresh fruit bunches
(“ffb”), expects to process more of its own crop as yields
increase in future years, and continues to seek additional
hectarage close to its own milling facilities.
The Group remains committed to operating responsibly
and sustainably. More information is available in the
sustainability section of this report on pages 32 to 39, and
in separate reports available from the Group’s website.
The Group produces certified sustainable palm oil at all
its mills and, in particular, received accreditation from the
RSPO at its Musi Rawas mill in January 2024, whilst the
RSPO audit took place at its Bumi Mas mill in the second
half of the year. Following that audit, the Group expects
to receive the final accreditation at Bumi Mas during
2025, at which point all Group mills will be RSPO certified.
During 2024, at its Bangka estate, the Group established
a dedicated biodiversity team guided by specialist
consultants, whilst at Bumi Mas, the Group took over
the management and protection of a significant area of
mangrove forest, with substantial conservation benefits.
During 2024, the Group acquired the 5% minority interest
in the majority of its Indonesian subsidiary companies.
As a result of this transaction, the Group effectively
acquired approximately 1,700 hectares of its own high-
quality planted areas, and now owns 100% of all of its
Indonesian operations, with the exception of its Bangka
estate where there remains a 10% minority partner.
The Group paid US$9,000 per planted hectare for this
transaction, which compares favourably with the average
year-end independent valuation of the Group’s majority-
held areas of US$18,500 per hectare, as shown on
page 100 of this report. Similar to share buybacks, this
transaction was immediately earnings enhancing, and
concentrates the interests of existing shareholders in the
Group’s operations.
PROSPECTS
The new year has started positively, and staff across the
Group are engaged in a number of projects further to
develop and enhance the Group’s estates. The total crop
harvested by the Group in the first two months of 2025
was 200,100 tonnes, 7% higher than the amount harvested
in the first two months of 2024.
The total crop harvested by the Group
in the first two months of 2025 is 7%
higher than the amount harvested in
the first two months of 2024.
The Group has purchased less outside crop for processing
at 39,500 tonnes (2024 — 58,900 tonnes), but this is
consistent with the approach taken in 2024, ensuring
that the Group focuses on both the efficient and the
profitable use of its production facilities. New planting
is continuing on Group estates, including at Musi Rawas
and, very encouragingly, at the recently acquired ABK
Chairman’s statement continued
4
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
CHAIRMAN’S STATEMENT
estate, which is part of the enlarged Kota Bangun project.
This new planting will, in due course, add to the Group’s
crop, contributing further to the long-term trend of
growing Group harvests, supporting the Group’s ambition
to provide increasing input to its mills from its own high-
quality crop.
The shift towards milling its own supply will, over time,
enable the Group to increase, from the current 69%, the
proportion of certified sustainable output that is sold. For
the first time in 2024, the Group has been able to supply
CPO from one of its mills as 100% certified. It is already
working with its customers to confirm its ability to supply
CPO compliant with the EU Deforestation Regulations
(“EUDR”) and expects to achieve this milestone during the
current year, and well before the revised implementation
deadline at the start of 2026. More detail on this is
provided in the strategic report.
CPO pricing has remained strong in the early part of 2025.
Whilst not matching the very high prices seen towards
the end of 2024, the Group has achieved an ex-mill-gate
price of approximately US$870 per tonne for the first two
months of the year, which compares favourably with the
average for 2024 of US$823 per tonne.
The Group has achieved an
ex-mill-gate price of approximately
US$870 per tonne for the first two
months of the year.
Management remains focused on opportunities for
growth and is actively pursuing potential acquisitions.
The Group’s balance sheet strength and highly cash-
generative nature enables it to be responsive to relevant
and appropriate opportunities as and when they arise. Of
particular strategic interest are planted areas near to the
Group’s existing estates and mills, which would support
the goal of increasing utilisation of the Group’s existing
production facilities. Several opportunities, at various
development stages, continue to be under review.
The operating environment in early 2025 of increasing
crop, ongoing planting and strong pricing gives the
Group confidence in its prospects for the coming year,
and beyond.
BOARD AND SENIOR MANAGEMENT CHANGES
All members of the board served throughout the year and
up to the date of this report. As previously reported, my
own role transitioned from that of an executive chairman
to a non-executive chairman on 1 July 2024. I am
pleased to report that, with the full support of my board
colleagues, this has been a smooth transition, and the
board continues to operate effectively. This was endorsed
as part of an independent board review undertaken in
the second half of 2024, as described further on page
51. As part of my non-executive role, I continue to work
closely with my executive colleagues, the wider board,
and with our shareholders, principal advisers and key
stakeholders.
Bruce Tozer, who will have served on the board for nine
years in June, chairing the audit and remuneration
committees since 2022, in addition to his role as senior
independent director, will be retiring at the AGM. Bruce’s
wealth of knowledge and experience in areas of, inter
alia, agriculture, commodities, commerce, banking,
sustainability and carbon, will be much missed. I should
like to place on record the board’s appreciation to
Bruce for his significant contribution to the Group. My
colleagues and I are now actively engaged in the process
of recruiting a new independent non-executive director
who will possess the requisite skills, experience and
personal attributes to ensure the board continues to
operate effectively. Further information on this, and on
the transition of the senior independent director and
committee chairing roles, will be provided in due course.
ACKNOWLEDGEMENTS
Once again, the Group has delivered on its strategy and
maintained its long-term momentum throughout 2024.
We are well established as not just an excellent producer
of ffb, but a high-quality miller as well. After a significant
period of investment, almost all our ffb is now processed
‘in-house’, and we produce and sell a high volume of
our own CPO. For this, we should all be proud, and it has
only been possible to reach this point in the Group’s
development because of the experience, expertise and
commitment from the thousands of people upon whom
we rely every day, whether in the UK, Jakarta or across
all our Indonesian operating locations. On behalf of the
board, I would like to thank them, and I look forward to us
continuing to thrive together.
Peter Hadsley-Chaplin
Chairman
25 March 2025
5
Jakarta
Medan
Bangka
Island
Singapore
Kuala
Lumpur
Sumatra
2
1
4
3
5
8
Map and locations
Indonesia
Malaysia
Group operation
Minority interest
1 SIMPANG KIRI
Mature oil-palm estate in the province of Aceh,
near the border with North Sumatra, which was
acquired in the early 1980s. Ffb are processed in
a nearby third-party mill. A further 1,900 planted
hectares were acquired in early 2023.
Group planted area: 4,300 hectares
Scheme-smallholder planted area: 300 hectares
5 BANGKA
Located on the island of Bangka, the land was
acquired in 2005. The first areas planted started
production during 2009. A 45-tonne mill with
composting facility and biogas plant was commissioned
in May 2016 and extended to 60 tonnes in 2019.
Group planted area: 6,100 hectares
Scheme-smallholder planted area: 3,900 hectares
2 KERASAAN
Mature (ex-rubber) oil-palm estate near the
town of Pematangsiantar in North Sumatra.
Ffb are processed in the neighbouring Bukit
Marajah mill, owned by the SIPEF Group -
also the majority shareholder in Kerasaan.
Planted area: 2,300 hectares
Group minority share: 38%
4 MUSI RAWAS
Located in South Sumatra province near the town of
Lubuk Linggau, the project was started in 2012 and reached
the initial target of 10,000 planted hectares during 2023.
A 60-tonne mill was commissioned in February 2023.
Group planted area: 7,900 hectares
Scheme-smallholder planted area: 3,000 hectares
3 PANGKATAN GROUP
Grouping of three estates (Pangkatan, Bilah, Sennah) whose
fruit is processed in a 40-tonne mill built on Pangkatan in
2005. Combination of a long-established, mature (ex-rubber)
oil-palm estate (Pangkatan), and land subsequently acquired
or planted (Bilah and Sennah).
Group planted area: 7,000 hectares
Scheme-smallholder planted area: 1,400 hectares
6
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
Kalimantan
Samarinda
7
6
6
7
8
KOTA BANGUN ESTATES
Located in East Kalimantan, close to Kota
Bangun and next to the Mahakam river.
There are two mills on site: a 60-tonne mill
commissioned in December 2012, and a
45-tonne mill commissioned in September
2020. A further 8,300 planted hectares were
acquired in November 2023 to increase mill
utilisation with Group crop.
Group planted area: 17,100 hectares
Scheme-smallholder planted area:
6,300 hectares
BUMI MAS
Located in East Kalimantan, north-east of
Sangatta next to the Manubar river. The land
was acquired in 2017. It was largely planted
in 2012-14, with the first harvesting taking
place during 2015. A 60-tonne mill was
commissioned in August 2021.
Group planted area: 7,500 hectares
Scheme-smallholder planted area:
1,400 hectares
BERTAM PROPERTIES
This land was previously the Group’s Bertam Estate, all of
which has been sold to Bertam Properties, a joint venture with
two Malaysian partners. Starting in 1992 with an area of some
2,000 hectares, the area has been developed into a new town.
The remaining developable area is 195 hectares.
Bertam Properties: 298 hectares
Group minority share: 40%
1-0027-06-100-00
7
OPERATIONAL HIGHLIGHTS
Market information
PALM OIL
Palm is one of the world’s major vegetable oils. Every
year, the world produces and consumes over 200 million
tonnes of vegetable oil and, in recent years, palm oil has
become the largest individual contributor to the world’s
vegetable-oil requirements, accounting for approximately
40% of the total, after including its complementary
product, palm-kernel oil. Unlike the other major oils
(soya, rapeseed, and sunflower), palm is a permanent
tree crop, and this is one of the reasons behind it being
the most productive of the major oils based on land
use. On average, around the world, palms can produce
approximately three tonnes of crude palm oil per mature
hectare of land cultivated. Whilst Indonesian yields were
down slightly in 2024 (discussed further below), because
of the efficient operation of its high-quality estates and
mills, the Group was able to produce approximately five
tonnes of CPO from each mature hectare.
During 2024, Indonesian palm producers, particularly
across Sumatra and Kalimantan, felt the effects of a
period of dry weather which occurred in the second half
of 2023 (and the Group was not immune to this — see the
‘crop’ section on page 16 for further details). This resulted
in some stress to oil-palm plantings at the time of the dry
weather, but this had the delayed effect of restricting the
weight of ffb harvested in 2024 and, in some cases, it also
disrupted the natural sequence of palm pollination. There
was some evidence of this in the first half of the year but,
partly because of the delayed effect and partly because
of the normal seasonality tending to favour the second
half of the year, the countrywide impact was more acute
in the second half.
Based on latest estimates, overall CPO production in
Indonesia was down by 6% in 2024 to 45.5 million
tonnes, and global production was down by 3% to 79.3
million tonnes. Despite this, palm-oil consumption
continued to increase, keeping prices firm. Prices
increased notably in the second half of the year as
the production shortage became more apparent. Also
supporting prices was an increase in consumption in
Indonesia itself, partly due to an increase in the amount
used in local biodiesel, further restricting the amount
available in export markets.
Harvesting ffb at Kota Bangun
8
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
THE PALM-OIL MARKET
PALM-KERNEL OIL
The Group’s mills produce two main
products, crude palm oil and palm kernels
(“PK”), in a ratio of approximately five tonnes
of CPO for every tonne of PK. The Group does
not produce its own palm-kernel oil (“PKO”),
rather it sells its PK to outside crushing
facilities. However, inevitably, the price the
Group receives for its PK is connected to the
wider PKO market.
At the start of 2024, the PKO market was
characterised by high inventories and low
prices, reflecting relatively weak demand in
the previous 12 months, predominantly in
the food and oleochemical sectors. As the
year progressed, production levels for PKO
inevitably reflected a similar pattern to those
for CPO, given that they are complementary
products from the same source. With
restricted production, falling inventory levels,
and some increases in demand, particularly
in domestic markets, prices increased,
once again most noticeably in the second
half of the year. By the end of 2024, the
price of PKO, and by extension the price
available to the Group for its PK output, was
approximately double the price prevailing at
the start of the year.
MAIN PRODUCERS
OF PALM OIL
2024
Main producing countries
Remaining 19% consists of
Thailand (4%), Colombia (2%),
Nigeria (2%), other countries (11%)
MAIN CONSUMERS
OF PALM OIL
2024
Main consuming countries
Remaining 11% consists of
Americas (9%), other countries (2%)
Source: Oil World 2024 data
27%
Indonesia
24%
Other Asia
13%
Africa
12%
India
7%
China
6%
EU
57%
Indonesia
24%
Malaysia
CRUDE-PALM-OIL PRICE
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2025
2024
2023
2022
2021
2020
US$ per tonne
cif Rotterdam
9
The Group’s business model
Our main resources
* Based on a share price of 991.66p on 31 December 2024.
Robust
production
372,200
tonnes of CPO
Sustainable
production
69%
certified
sustainable CPO
Cost
efficiency
US$410
per tonne own
palm product
Improving
returns
52.5p
normal dividend
for 2024
Outcomes
The Group is committed to the responsible management of both its own areas of Indonesian oil palm, and those
managed on behalf of associated scheme smallholders. The Group’s employees are dedicated to continual
improvement and are supported by ongoing investment enabled by many years of sound financial management.
As a result, the Group is able to deliver increasing amounts of sustainable production on a cost-effective basis,
leading to progressive shareholder returns.
49,800
hectares of
Group oil palm
16,200
hectares of
smallholder
oil palm
12,600
employees
Net
funds
Plantation land
The Group’s plantation land
is used to grow oil palms and
harvest their fresh fruit bunches.
Community relationships
The Group engages with the
local communities living on and
near its operations and manages
smallholder schemes to the same
high standard as Group areas.
People
The Group’s employees are
fundamental to its success,
and the Group is committed
to their welfare, training and
development.
Stable funding
The Group has a robust
balance sheet with net funds
of US$46 million and a market
capitalisation of more than
US$640* million.
10
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
GROUP BUSINESS MODEL
Strategy pillars
GROWTH IN CROPS PROCESSED (‘000 TONNES)
GROWTH IN DIVIDENDS (PENCE)
We seek to grow and develop the business. Growth
continues to come from the increasing maturity of
the Group’s young estates, from the ongoing focus
on improving yields, and from the acquisition and
sustainable development of new areas of land.
Acting responsibly is at the heart of what we do and
who we are. We are active members of the RSPO, we
do not deforest, and are good stewards of the land
we cultivate. We provide high-quality housing along
with medical, educational and leisure facilities for
our workers and their families.
The Group’s investment strategy has already led
to a significant improvement in shareholder
returns. In line with its growth programme, the
Group aims to deliver increasing returns to
shareholders.
Excellence comes from investing for the long term.
Our investment is not only in plantation assets
but also in our employees, their diversity and
inclusion, and in their training and development.
In this way, we are consistently able to deliver both
high yields and high oil-extraction rates from our
estates and mills.
M.P. Evans is a responsible producer of sustainable Indonesian palm oil, striving for
excellence in all its operations, with a focus on continuing growth and offering an
increasing yield.
Staff training
Housing at Bumi Mas
Excellence
Yield
Responsibility
Growth
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
Group
Scheme smallholders
Independent
0
10
20
30
40
50
60
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
Normal dividends
11
STRATEGY
In 2024, the Group was able to continue deploying and
developing its strategy of being a producer of certified
sustainable Indonesian palm oil. Following a period of
extensive capital investment, the Group had, for the first
time in 2024, six palm-oil mills in operation for the whole
year. More specifically, all six mills were able to produce
certified sustainable crude palm oil (“CPO”) throughout
the year and, as a result, the proportion of the Group’s
production qualifying as sustainable oil increased from
62% in 2023 to 69% in 2024. The Group’s strategy, which
will bring financial gains along with other benefits, is to
continue increasing this proportion. The Group expects to
be able to achieve this in three separate ways: firstly, by
increasing the efficient operation of its existing planted
areas; secondly, by adding further planted hectarage
within the estates it already owns and operates; and,
thirdly, by acquiring additional planted hectarage close to
the Group’s existing milling facilities.
In furtherance of the Group’s strategy, the Group
continued to plant new areas during 2024, most
significantly at its Musi Rawas project in South Sumatra
where a further 500 hectares were planted, bringing the
total planted hectarage for the Group and its associated
scheme smallholders to 10,800 hectares there. The Group
expects to surpass the updated 11,000-hectare target
in early 2025 and to continue planting thereafter. Every
additional hectare planted will, in due course, provide
additional valuable crop to the Group’s on-site mill,
increasing the amount of sustainable output, reducing
reliance on outside suppliers, and be margin enhancing.
As indicated in previous reports, the Group’s recently
acquired properties at Kota Bangun will, over time, make
a significant crop contribution to the Group’s two mills
there. Even more encouragingly, after careful analysis,
working with the Group’s environmental consultants,
management have identified some further areas suitable
for planting within these properties, and a planting
programme began just before the end of 2024. Whilst
there was only a small amount completed before the end
of the year, management have set a target to achieve in
excess of 1,000 hectares of new planting there before the
end of 2025.
The smallholder plantings which form part of the areas
managed and harvested by the Group remain an integral
part of the Group’s activities, and the Group is committed
to working in close partnership with all the smallholder
co-operatives at each of its estates. The Group purchases
crop from the smallholders at a fair price, and the Group
and its associated smallholders succeed and thrive
together. The newest smallholder areas are connected to
the Group’s estates in North Sumatra and Aceh and, over
recent years, approximately 1,600 hectares have been
established, with over 250 hectares planted during 2024.
The Group provides initial funding to ensure that planting
can be done efficiently and without creating a financial
burden for the smallholder.
The Group’s sustainability team has worked on a
number of new initiatives during 2024 and, thanks to the
successful adoption of a large area of mangrove forest
for conservation, adjacent to the Group’s Bumi Mas
estate, the Group has been able to achieve its target of
having conservation areas representing at least 10% of
its planted hectarage. The Group’s sustainability team
is, with the support of estate management, responsible
for the management and monitoring of 8,000 hectares
specifically set aside for conservation within the Group’s
estates.
At the end of 2024, the planted area of the Group’s
majority-owned Indonesian estates had increased to
49,800 hectares (2023 — 49,600 hectares) and the
area managed on behalf of scheme smallholders had
increased to 16,200 hectares (2023 — 15,900 hectares).
The Group has, for many years, had minority partners in
Indonesia who have owned a part of the Group’s planted
land. In 2024, the Group reached an agreement to buy
out one of those minority partners, Praba Madhavan,
who owned a 5% interest in the majority of the Group’s
plantations. Following that transaction, there is only
one remaining minority partner, Karli Boenjamin, in
Indonesia, owning a 10% interest in the Bangka estate.
As a result, Group shareholders increased their interest
by approximately 1,700 hectares and now own 100% of
almost all the Indonesian operations. Furthermore, by
acquiring a majority stake at a minority price, the minority
acquisition in 2024 was value enhancing for shareholders
in 2024, and will be in the future.
Strategic report
The Group’s purpose and strategy is to be a responsible producer of certified
sustainable Indonesian palm oil. During the year, it maintained steady expansion of its
Indonesian palm-oil areas in a sustainable and cost-effective manner.
12
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
STRATEGY
The board understands that, in meeting its obligation
under section 172 of the Companies Act 2016 to
promote the success of the Company for the benefit
of its members, it must also have regard to wider
considerations, including the likely consequences of
any decisions in the long term, on the community,
the environment and the Group’s reputation. It must
consider the interests of stakeholders, and it must act
fairly between members of the Company. Each member
of the board is aware of their individual obligations
under section 172, and the need to apply the broader
considerations referred to in section 172 to their decision
making. Where appropriate, board discussions are framed
by a reminder of the section 172 considerations. This
was the case, for example, when the board conducted its
strategy review day in June 2024.
The board reviews at least annually which organisations
or individuals it considers to have a reasonable
expectation of being significantly affected by, or of
affecting, the activities of the Group, including assessing
the best means of engaging with those stakeholders.
The Group’s current stakeholders are shown overleaf, and
further details on how the Group engages with them are
shown on the Group’s website. The regular review of this
list ensures that board members are mindful of different
stakeholders and, where appropriate, engage with them
as part of the decision-making process.
During the year, the directors considered possible
opportunities to increase the Group’s planted hectarage,
in line with strategic objectives. As a producer of
sustainable palm oil operating in Indonesia, the directors
are well aware of the concerns expressed by various
stakeholder groups, including shareholders, regarding
the impact of land use for palm cultivation on the
environment and local communities. Any new land under
consideration is thoroughly reviewed to ensure that it
meets, or can be rehabilitated to meet, the requirements
set out by the RSPO, which has developed standards for
certifying palm-oil production as sustainable, based on
adherence to strict environmental, social and governance
(“ESG”) criteria. The review process for potential new
areas includes checking that local communities around
them have been properly compensated where
applicable, and that there are no grievances which
cannot be resolved.
Board members are aware that the Group has invested
in, and has earned itself a strong reputation for, being a
sustainable producer of palm oil in an industry which,
rightly, comes under scrutiny. The discussions and
decisions of the board are infused with the ethos of
integrity, a desire to preserve the Group’s reputation
as a sustainable operator, good employer and trusted
business partner, and with a forward-looking approach to
making decisions which are designed to generate long-
term value for shareholders.
In addition to increasing the Group’s hectarage with new
land, the directors had the opportunity effectively to
increase its hectarage through both its share-buyback
programme and the purchase of the majority of the
minority-held shares in its Indonesian subsidiaries.
In considering this allocation of capital, the board
was mindful of optimising value for the Company’s
shareholders, without compromising other stakeholder
interests. This capital allocation does not come at the
expense of initiatives taken by the Group to mitigate
the effects of climate change and concerns about the
loss of biodiversity. The Group has begun investing in a
biodiversity project on its Bangka estate, and a mangrove
conservation project at its Bumi Mas estate in East
Kalimantan.
Due to the anticipated implementation of the EU
deforestation regulations (“EUDR”), which will require
the supply chains of products sold in the European
Union to be free of deforestation, the Group’s teams
in Indonesia have been engaging with the Group’s
customers to better understand how the Group can
meet the traceability requirements which will become
mandatory in January 2026. The board is kept informed of
stakeholder responses to the regulations and uses these
insights to inform strategic planning.
‘SECTION 172’ STATEMENT: IMPLEMENTING THE STRATEGY
13
Results & financial position
NON-FINANCIAL AND SUSTAINABILITY
INFORMATION
The Group has provided non-financial and
sustainability information and climate-
related financial disclosures within the
sustainability section on pages 32 to 39,
which is included as part of the strategic
report by reference.
STAKEHOLDERS
During their most recent review, the
board identified ten separate groups of
stakeholders whose interests should be
considered. They were:
(i) investors in M.P. Evans Group PLC,
(ii) employees of the Company and its
subsidiaries,
(iii) the Group’s associated scheme
smallholders,
(iv) local communities on and around the
Group’s operational locations,
(v) co-investors in the Group’s
Indonesian activities,
(vi) certain key suppliers to the Group,
(vii) certain key customers of the Group,
(viii) European plantation companies with
operations similar to those of the
Group,
(ix) government and regulatory bodies
relevant to the Group, and
(x) industry certification bodies including
the RSPO.
The corporate governance section of
this report on pages 45 to 53 includes
examples of the way the board engages
with stakeholders.
REVENUE AND GROSS PROFIT
The Group’s revenue in 2024 was US$352.8 million, up by 15%
on the US$307.4 million in 2023. The total crop processed,
and production levels, were very similar to the previous year
and, hence, the primary reason for the increase in revenue was
the higher prices achieved in the year. The Group’s average
mill-gate price for CPO was US$823 per tonne in the year, 13%
higher than the US$729 per tonne in 2023. Revenue was given
a further boost by the rebound in palm kernel (“PK”) prices,
with average pricing up to US$525 per tonne, 48% higher than
the US$354 per tonne in 2023.
The Group continued to keep tight control over its costs
in 2024, and the primary measure was its cost per tonne
of production, being the cost associated with each tonne
of ‘palm product’ (both CPO and PK). The cost per tonne is
determined on a fully absorbed basis, recognising the direct
costs associated with the estate and mill operations, but also
accounting for all estate and mill overheads, all central costs
allocated from the Jakarta office as well as an allocation of
the UK head office costs. Whilst the Group continued to feel
inflationary effects in some of its cost centres, there was
evidence of unit cost reductions in fertiliser inputs from their
high point in late 2022 and early 2023. Overall, cost per tonne
for crop harvested from the Group’s own areas was US$410 in
2024, 4% down on the US$427 per tonne in 2023.
Cost per tonne when allowing for the purchase of crop from
both scheme smallholders and independent suppliers is
inevitably higher, partly a factor of the purchase cost itself and,
in the case of independent supplies, partly the quality of the
crop itself. Additionally, purchase prices increase when CPO
prices are higher, as was the case in 2024. As a result, the total
cost per tonne, allowing for all crop sources, was US$519
(2023 — US$498).
With six mills in operation throughout the year, the Group
made the substantial majority of its profit from processing the
crop it harvested from its own areas and from its associated
scheme smallholders in its own mills, and selling its own CPO
and PK. Whilst selling ffb for processing in outside mills, and
purchasing independent ffb for processing in Group mills, are
both remunerative activities, the margins are not as attractive.
The Group’s focus is on continuing to increase the proportion
of its revenues and profits generated by milling crop harvested
in areas managed to the Group’s own high standards.
Taking the above activities into account, with the
benefit of the CPO price increase being the most significant
change in the year, the Group’s gross profit increased in the
year by 49% to US$116.6 million (2023 — US$78.5 million).
14
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
STRATEGY
ADMINISTRATIVE EXPENSES AND OTHER INCOME
The administrative charges incurred by the Group
increased by US$0.5 million, from US$5.4 million in 2023
to US$5.9 million in 2024. The underlying costs were
similar in each year, but the Group took the strategic
decision to write off certain assets, including some areas
for accelerated replanting, resulting in an additional
income-statement charge. Whilst the Group benefited
during the year from a weakening Indonesian Rupiah in
transactional terms (as discussed in the costs section
on page 21), the translational effect was small due to
the structure of the Group’s balance sheet. The Group
recorded a gain on biological asset valuations of
US$1.8 million (2023 — US$0.6 million), based on a
combination of higher prices along with stronger cropping
levels in the early part of 2025 (which are indicative of
biological formation at the end of 2024). Finally, the
Group continues to benefit from an increasing amount
of ‘other income’, up to US$3.2 million (2023 — US$2.9
million), arising from the sale of ancillary products from
the milling process, including shells and the Group’s
surplus renewable electricity generated in its biogas
facilities.
NET FINANCE COSTS
The Group took on new loans of US$22.5 million towards
the end of 2023 as part of the acquisition of additional
hectarage in East Kalimantan. Despite this, thanks to the
continued repayment of its previously held loans, due
for full repayment by mid-2025, the Group’s total finance
costs continued to fall, from US$3.8 million in 2023 to
US$3.4 million in 2024.
TAXATION
The total tax charge for 2024 was US$25.2 million (2023
— US$18.8 million), an inevitable rise following the
significant increase in the Group’s profitability. However,
the Group’s effective tax rate has decreased in the year,
and a reconciliation of the tax charge is included in
note 9 to the accounts. The Group continues to pay a
substantial amount of corporation and other taxes in
Indonesia, its primary operating location, and remains
committed to fulfilling its tax obligations.
ASSOCIATED COMPANIES
The Group’s Indonesian oil-palm associate,
PT Kerasaan, 38% owned, contributed US$1.4 million
(2023 — US$1.1 million) to Group profit in the year, and
the Group received dividends of US$1.9 million
(2023 — US$2.5 million). The Group’s Malaysian associate,
Bertam Properties Sdn Bhd, 40% owned, contributed
US$1.0 million (2023 — US$1.3 million) to Group profit
in the year, and the Group received dividends of US$0.5
million (2023 — US$1.1 million).
PROFIT FOR THE YEAR
As a result of the above, the Group’s retained profit for
the year was US$90.6 million (2023 — US$56.4 million).
Following the acquisition from the Group’s minority
partner during the year, a higher proportion of profit is
allocated to Group shareholders. 97% of the Group’s
retained profit (2023 — 93%) has been allocated
to owners of M.P. Evans Group PLC in 2024, and this
proportion is expected to increase again in 2025 as
the impact of the minority purchase is applied
throughout the year.
NET ASSETS AND BORROWING
The Group’s net assets had increased by the end of the
year to US$533.5 million (2023 — US$505.1 million).
Current assets exceeded current liabilities by US$77.4
million (2023 — US$45.2 million). The Group had
continued to generate significant amounts of cash during
2024, as a result of which, by the end of the year, the
Group had net funds of US$46.4 million (2023 net debt
of US$14.8 million) and therefore no net gearing (2023 —
3%). Gross gearing was 6% (2023 — 10%).
Gross
profit
US$116.6
million
2023 US$78.5m
Revenue
US$352.8
million
2023 US$307.4m
Palm-kernel
EMG sale
price
US$525
per tonne
2023 US$354 per tonne
CPO EMG
sale price
US$823
per tonne
2023 US$729 per tonne
15
Operations: Indonesian palm oil
CROPS
The Group seeks to maximise the profitable utilisation
of all its six palm-oil mills. To do this, it obtains
crop from three distinct sources. Firstly, it owns and
manages almost 50,000 hectares of planted oil palms
in Indonesia, the majority of which are in Sumatra and
East Kalimantan. Yields from these areas are maximised
by the dedicated and experienced estate management
resident on each estate. Secondly, those teams are also
responsible for a further area of just over 16,000 hectares
of oil palm, managed by the Group, but owned by scheme
smallholders associated with the Group’s operations.
Managing these additional areas to the same high
standards as those owned directly by the Group provides
a valuable secondary source of crop. Finally, the Group
purchases additional crop for processing in its mills from
independent suppliers, where and when crop of suitable
quality and price is available, with the objective of
maximising mill utilisation.
The total crop processed by the Group in 2024 was
1,608,900 tonnes, down by 1% on the 1,622,900 tonnes
in 2023. This reflected an increase in crop harvested
from areas managed by the Group, but this was more
than offset by a decrease in purchases from independent
suppliers.
Like producers across all of Indonesia, the Group’s crop
was adversely affected in 2024 by a period of particularly
dry weather towards the end of 2023. Despite this, the
total harvest from the Group’s own estates increased
by 2% to 937,000 tonnes (2023 — 922,900 tonnes). The
Group benefited from the crop harvested at the areas
acquired over the course of 2023 at Kota Bangun and
Simpang Kiri, which between them contributed a total of
57,100 tonnes. Without the crop from recent acquisitions,
there would have been a decrease in crop from the
Group’s own estates of 3%. The same pattern can be
seen in crop harvested from areas owned by associated
scheme smallholders, which increased by 3% to 285,900
tonnes (2023 — 278,500 tonnes) but, without additional
crop from the newer areas, would have been down by 1%.
The Group expects to see the long-term trend of crop
increases from the Group’s managed areas continue
into 2025 and beyond for several reasons. The estate
management teams have been working on projects to
rehabilitate and improve the planting quality of the areas
acquired in 2023. It was well understood, and reflected
in the price paid on purchase, that upon acquisition
those areas would need some careful management,
and in certain cases, some replanting before they would
achieve similar yields to the rest of the Group. Work has
continued throughout 2024 and progress has been made,
but the rewards for the investments made will start to be
fully realised in subsequent years. The Group is moving
away from the adverse climatic effects of late 2023, and
should see a recovery in yields as a result. New planting
and replanting is taking place, as discussed in more detail
in the planting section on page 22.
The total amount of independent crop purchased for
processing in Group mills in 2024 was 386,000 tonnes
(2023 — 421,500 tonnes). Following a substantial 24%
increase in independent purchasing in the previous year,
the Group took a more measured approach to buying in
crop from outside suppliers in 2024. Whilst management
is keen to fill up spare capacity wherever possible, both
the quality and the cost of crop being offered for sale are
important factors, and the Group strives to ensure that
mill capacity is being used profitably. During a year in
which crop levels have been down for many operators, a
lower amount of independent crop was in higher demand,
and the Group made judicious and prudent decisions,
when appropriate, to maintain margins.
As part of the Group’s commitment to maximising mill
utilisation with its own harvest, the crop from the ABK
estate, purchased during 2023, has been processed in
the Rahayu mill at Kota Bangun since acquisition. The
Nusantara estate was purchased at the same time, but
initially, being slightly further away from Kota Bangun,
its crop was sent to an independent third-party mill
for processing. During 2024, management successfully
established a supply route from Nusantara to Kota
Bangun, supporting the commitment to process the
Group’s harvest in Group mills, and its crop is now
also being processed at Rahayu mill. As a result, for
management and reporting purposes, like ABK, Nusantara
is being treated as part of the Kota Bangun property.
At the enlarged Kota Bangun property, Group crops
increased by 14%, with a corresponding increase of 5%
in crops from the Group’s scheme smallholders, with
the total harvest reaching almost 390,000 tonnes. This
estate benefited the most from the inclusion of the areas
acquired towards the end of 2023, and this will continue
to be the case for several years to come as the Group
works to bring the significant acquired area, more than
8,000 planted hectares and increasing as more hectares
are planted, up to the same standard as the rest of
Kota Bangun.
16
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
OPERATIONS
At Bangka, the total harvest was marginally
down on the previous year, as management
worked hard to deal with a combination of
climatic and agronomic issues. Given the time
and effort put in by field assistants, managers
and the senior supervisory team, there are
encouraging signs of a higher crop there in
recent months.
The Group-owned estates close to the
Pangkatan mill have the highest average
age, and go through a programme of routine
replanting, with more planned in the coming
years. As a result of their mature age, and
the experienced staff and workforce in North
Sumatra, they also achieved some of the highest
yields in the Group, delivering over 26 tonnes
per mature hectare, albeit lower than that
produced in the previous year predominantly
as a result of the dry weather conditions. By
contrast, the associated scheme smallholders
close to the Pangkatan mill have some of the
youngest plantings under Group management,
the majority still immature, and the crop from
these areas is expected to increase significantly
in the coming years.
The total harvest from the areas managed by
the Group at Bumi Mas in 2024 was 174,000
tonnes, lower than the previous year by 12,100
tonnes and a little behind Group expectations.
Management has worked on a number of
specific issues on the estate during the year and
anticipate a higher crop in the next full year.
The yield at Musi Rawas continues to increase as
the estate continues to grow. More areas came
into production during the year, and by the
end of 2024 the estate had over 8,000 mature
hectares. As the estate continues to grow and
develop, so additional areas will come into
maturity, and the yield from young areas will
continue to increase, boding well for further
crop increases from this estate.
Simpang Kiri saw an increase in crop in 2024,
aided by the areas purchased in 2023. However,
a significant part of the purchased area has
been replanted and, as a result, along with the
recently developed smallholder areas close to
the estate, over one quarter of the managed
area is currently immature. Like Musi Rawas, this
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2024
2023
2022
2021
2020
2019
2018
2017
2016
2015
2014
Group
Scheme smallholders
Independent
CROP HISTORY
tonnes (‘000)
CROPS
2024
Tonnes
Increase/
(decrease)
%
2023
Tonnes
Own crops
Kota Bangun
284,000
14
249,900
Bangka
137,400
(1)
138,200
Pangkatan group
168,600
(9)
185,000
Bumi Mas
144,800
(7)
156,400
Musi Rawas
136,100
6
128,900
Simpang Kiri
66,100
2
64,500
937,000
2
922,900
Scheme-smallholder crops
Kota Bangun
105,500
5
100,500
Bangka
81,400
(4)
85,200
Pangkatan group
5,200
100
2,600
Bumi Mas
29,200
(2)
29,700
Musi Rawas
64,000
6
60,200
Simpang Kiri
600
100
300
285,900
3
278,500
Independent crops purchased
Kota Bangun
144,200
9
132,000
Bangka
91,400
(16)
108,600
Pangkatan group
37,200
(29)
52,600
Bumi Mas
39,800
(33)
59,500
Musi Rawas
73,400
7
68,800
386,000
(8)
421,500
TOTAL CROP
1,608,900
(1)
1,622,900
17
Strategic report continued
demonstrates the long-term investment that has been
made, and is promising for further crop growth in future
years at Simpang Kiri.
PRODUCTION
The Group had six mills in operation throughout 2024.
The Kota Bangun project has two mills, Bumi Permai
and Rahayu. There is a single mill at each of the Bangka,
Pangkatan, Bumi Mas and Musi Rawas estates. The only
location without a mill is the Group’s smallest estate at
Simpang Kiri. The total amount of CPO produced from the
crop processed by the Group in 2024 was 372,200 tonnes
(2023 — 378,500 tonnes), of which 356,200 tonnes (2023
— 362,100 tonnes), representing 96% (2023 — 96%) of
the total was produced in Group mills.
During 2024, the Group sold crop from its Simpang
Kiri estate to a third-party mill for processing. This
was also the case during the year for some of the crop
from the Group’s recently acquired Nusantara estate
at Kota Bangun, although the majority was successfully
transported to the Rahayu mill. When crop is sold to an
outside mill, a price is agreed based on the CPO price and
an assumed extraction rate, as shown in the production
table on page 20. Because of the high quality of its own
crop, the Group has been able to secure a relatively high
assumed extraction rate as an outside crop supplier
from its Simpang Kiri estate. To be consistent with the
substantial majority of the Group’s other locations and
production, the CPO and PK produced from supplying to
outside mills are included as part of the Group total, but
subtotalled separately in the production table.
Mill management continued to work on maximising
oil-extraction rates during 2024 following the very
high average of 23.4% achieved in the previous year,
working in partnership with agronomic management at
each estate. In some cases, the climatic factors already
discussed made maintaining the previously achieved
rates particularly challenging in 2024, but the 23.2%
average achieved in 2024 was a commendable result. The
increase in the oil-extraction rate at the Rahayu mill was
particularly encouraging following the increase in crop
sent to it from the ABK and Nusantara estates purchased
in 2023. Estate and mill teams are continuing to work
together on a location-by-location basis to look for
further improvements in 2025 and beyond.
Group mills also produced 78,000 tonnes (2023 — 77,300
tonnes) of PK during the year, and the average extraction
rate in those mills increased to 5.1% (2023 — 5.0%), an
important result given the significant increase in
PK prices over the course of 2024. Combined with
production in outside mills, the total kernel production
from the crop processed by the Group increased to
81,300 tonnes (2023 — 80,600 tonnes).
The Group produces a number of important and valuable
ancillary products in addition to CPO and PK in its mills.
As part of the production process, the fibrous material
within each ffb is separated out, and the shell is collected
separately from the palm kernel. Both have high calorific
values and the fibre, along with some shells, are used to
fuel the boilers in the Group’s mills and bulking stations.
Excess shells are sold, generating valuable additional
income. Once the oil-bearing fruitlets have been
separated in a sterilising process, empty fruit bunches
are sent to our composting facilities to be converted into
organic compost which is applied back to the estates,
improving soil quality and reducing the need for, and cost
of, inorganic fertiliser. Waste water from the sterilising
process is sent to covered ponds where the methane
emitted is collected, significantly reducing greenhouse
gas emissions. This is treated and processed in biogas
engines to generate renewable energy. Over the course
20 years of milling
The Group opened its first palm-oil mill at the Pangkatan estate in late 2004, and celebrated its
20th anniversary of being a producer of CPO and PK with a special event held at Pangkatan in December
to mark this momentous occasion (see photos on inside back cover). Joining in the festivities along with
senior management were members of the estate and mill teams, their families and participants from the
local community. As the only mill in the Group, Pangkatan produced 21,000 tonnes of CPO in its first full
year of production, only 6% of the production from the Group’s now six mills in 2024.
18
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
OPERATIONS
of 2024, the Group generated 38 million kWh at its five
renewable energy facilities, selling a little more than half
of the energy produced into the local electricity grid to
generate additional income, and using the remainder
to power the Group’s own operations, including estate
housing. The Group’s engineering team have estimated
that, by using internally generated renewable electricity,
the Group has saved approximately US$3.0 million
(2023 — US$3.2 million) compared to other sources of
energy, in addition to the environmental benefits.
The Group has continued to purchase crop from outside
suppliers during 2024, a total of 386,000 tonnes
(2023 - 421,500 tonnes), albeit making up a smaller
proportion of the total crop processed in the year, at 24%
(2023 — 26%). This reflected the quality and availability
of independent crop for processing in some locations
during the year, but is consistent with the Group’s stated
goal of decreasing its reliance on crop from areas not
managed by the Group. Management expects this trend to
continue as crops from Group-managed areas continue
to increase, particularly as agronomic improvements are
made to recently acquired areas and younger plantings
reach full maturity.
The production of certified sustainable output is a core
part of the Group’s strategy, and throughout the year
all six of the Group’s mills have been certified to sell
sustainable CPO in accordance with the requirements of
the International Sustainability and Carbon Certification
(“ISCC”) scheme, enabling it to receive additional
sustainability income at all locations. In addition, as
a member of the Roundtable on Sustainable Palm Oil
(“RSPO”), the Group is committed to obtaining RSPO
accreditation for all six of its mills. By the end of 2024,
five mills had received accreditation, with the Musi
Rawas mill being certified in the early part of the year.
The RSPO audit took place at the Bumi Mas mill in the
latter part of 2024, and the Group aims to complete the
accreditation process during 2025. In addition, the Group
took the decision in 2024 to process only crop from
Group-managed areas at its Bumi Permai mill at Kota
Bangun and, as a result, that mill has been certified to
process ‘identity preserved’ CPO by the RSPO. This may, in
due course, lead to increased sustainability premia being
available at that location. The Group is also committed
to compliance with the upcoming EUDR which are due
to be implemented from the start of 2026. The Group is
satisfied that the areas it manages will be in compliance,
and is already working with a key customer in advance of
the implementation of the new standards.
MILL-GATE PRICE
The Group’s primary products, CPO and PK, are both
agricultural commodities and, as such, the prices that the
Group can achieve for its output can vary significantly
over time depending on underlying commodity prices.
Whilst the Group enters into supply agreements with
some of its key refining customers it has not, as a
matter of long-term policy, sought to fix prices forward,
on the basis that, unlike other vegetable oils, palm is
a permanent and continually producing tree crop and,
therefore, the Group is a routine and regular market
participant.
Some of the market forces relevant to the year are
discussed in the market information section on pages 8 to
9 and, during the course of 2024, the cif Rotterdam price
ranged between US$925 and US$1,390 per tonne, with
an average of US$1,084 per tonne, US$120 or 12% higher
than the US$964 per tonne average in 2023.
The Group does not receive the full benefit of cif
Rotterdam pricing for its output, as it sells both its
CPO and its PK ex-mill gate. The Group’s CPO is sent
to Indonesian refiners for onward processing, and its
kernels for crushing into palm-kernel oil. The Indonesian
government charges taxes and levies for the export of
palm oil and related products. As the Group sells its
output to domestic customers within Indonesia, it is
not responsible for paying these amounts, but they are
reflected in the prices achieved by the Group, along
with other, smaller, adjustments for freight, insurance
and processing costs. The Indonesian taxes and levies
are charged based on a sliding scale which reflects the
underlying CPO price and, as a result, the mill-gate price
achieved by the Group in the year moved approximately in
line with the movement in cif Rotterdam prices, increasing
by 13% to US$823 per tonne (2023 — US$729 per tonne).
After a relatively weak year in 2023, palm-kernel pricing
picked up in 2024, particularly in the second half of the
year, and by the end of the year the average price had
recovered to US$525 per tonne, 48% higher than the
US$354 in 2023, and by the end of the year some sales
were being made at approximately US$700 per tonne.
Whilst income from palm kernels only accounts for
less than 15% of Group revenue, the increase in price
provides a welcome boost to sales.
The Group remains focused on selling its output as certified
sustainable production, and both its CPO and PK are
sold as either RSPO or ISCC certified whenever possible,
subject to demand and maximising sustainability premia.
19
As referred to above, the proportion of the Group’s
CPO qualifying as certified sustainable increased in the
year from 62% to 69%. However, despite this increase,
somewhat disappointingly, the total income arising from
sustainability premia decreased in the year by 14% to
US$5.6 million (2023 — US$6.5 million). Average premia
available per tonne in 2024 continued the decrease
observed in the latter part of 2023 for both CPO and PK,
with the average available for CPO, when sold as
sustainable, now at US$10.34 per tonne (2023 — US$14.20)
and the average for PK at US$65.93 (2023 — US$90.60).
The reductions may reflect some continuing uncertainty
in the market as changes are being made in preparation
for the EUDR, which had originally been intended for
introduction in 2025, but was delayed by 12 months. The
Group remains committed to the production of certified
sustainable output, and will look for opportunities to
increase sustainability income wherever possible.
PRODUCTION AND EXTRACTION RATES: Group and third-party mills
Crude palm oil
Palm kernels
2024
Increase/
(decrease)
2023
2024
Increase/
(decrease)
2023
PRODUCTION
Tonnes
%
Tonnes
Tonnes
%
Tonnes
Group mills
Kota Bangun
123,500
10
112,000
27,200
12
24,200
Bangka
70,200
(9)
76,800
17,800
(6)
19,000
Pangkatan group
47,200
(13)
54,500
10,900
(12)
12,400
Bumi Mas
51,300
(12)
58,600
9,600
(7)
10,300
Musi Rawas
64,000
6
60,200
12,500
10
11,400
356,200
(2)
362,100
78,000
1
77,300
Third-party mills1
Kota Bangun
1,000
400
200
300
—
—
Musi Rawas
—
—
1,600
—
—
400
Simpang Kiri
15,000
3
14,600
3,000
3
2,900
16,000
(2)
16,400
3,300
—
3,300
372,200
(2)
378,500
81,300
1
80,600
EXTRACTION RATES
%
%
%
%
%
%
Group mills
Kota Bangun — Bumi Permai
24.3
—
24.4
5.6
2
5.5
Kota Bangun — Rahayu
22.1
4
21.3
4.5
5
4.3
Bangka
22.6
(2)
23.1
5.7
—
5.7
Pangkatan group
22.4
(1)
22.7
5.2
—
5.2
Bumi Mas
24.0
—
23.9
4.5
7
4.2
Musi Rawas
23.4
(3)
24.1
4.6
2
4.5
23.2
(1)
23.4
5.1
2
5.0
Third-party mills1
Kota Bangun
18.3
(9)
20.0
4.9
9
4.5
Musi Rawas
—
—
20.5
—
—
4.7
Simpang Kiri
22.5
—
22.5
4.4
(2)
4.5
1. The Group sells some crop to outside mills for processing, with a selling price based on the CPO market and an assumed rate of
extraction. However, to be consistent with other locations, CPO and PK produced from these estates’ crops are reported as part of
the Group total, but subtotalled separately above.
Strategic report continued
20
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
COSTS
In accordance with its published strategy, the Group
strives for excellence in all its operations. This involves
significant investment in a high-quality asset base,
including plantings, estate infrastructure, mills and
ancillary facilities and, just as importantly, a dedicated
and well-trained workforce to manage and run those
assets, supported by living and working conditions of
which the Group can be proud. All of this comes at a
significant cost, but by delivering high ffb yields along
with industry-leading oil- and kernel-extraction rates, the
Group is able to minimise its unit costs.
Management records and monitors unit costs as a cost
per tonne of palm product (discussed in more detail in
the key performance indicators section on pages 24 to
25). The Group’s core strategy is to harvest crop from
Group-owned areas and process it in one of its six palm-
oil mills. By doing so, costs are minimised and margins
maximised. Costs increase when the Group is required
to purchase crop for milling, and this occurs in two
separate ways. Firstly, the Group purchases crop from
the associated scheme smallholders attached to its own
estates. Whilst there is a purchase cost, typically reducing
margin, the Group can at least be assured of crop quality,
having managed and harvested the planted area on
behalf of the smallholder. In the second case, the Group
purchases crop from outside suppliers, again typically
reducing margin due to the purchase cost, but in this
case the Group suffers a further margin reduction due
to the poorer quality of the ffb supplied by independent
producers resulting in lower extraction rates.
The cost per tonne from Group-managed areas reduced
during the year, particularly during the second half
as production increased on higher crops, and lower
amounts of fertiliser were applied. By the end of the
year, the cost per tonne had reduced by 4% to US$410
(2023 — US$427). The largest part of the Group’s cost
base is people-related costs, and the Group successfully
managed those in 2024, in part benefiting from a
weakening Indonesian Rupiah during the year. The
main reason for the reduction in cost per tonne was
a continuing reduction in fertiliser costs from their
high point in late 2022 and early 2023, and the Group
benefited from this by more than US$20 per tonne of
production.
The Group’s cost of production is on a fully absorbed
basis, including all estate and mill overheads, along with
the costs of its central office in Jakarta distributed into
production plus an allocation of UK head office costs.
Following a period of substantial investment in estates
and mills, the cost per tonne also includes a significant
depreciation charge which accounted for just over 20% of
the total. As depreciation for 2024 was, for the first time
in many years, in excess of capital expenditure, the Group
continued to be ever more cash generative.
The total Group cost per tonne, after allowing for crop
that came from the Group’s own areas and the crop that
the Group purchased for processing, was US$519, 4%
higher than the US$498 in the previous year. Whilst the
Group enjoyed a reduction in its unit costs from Group-
owned areas, the costs associated with purchased crop
increased. Predominantly, this was due to increased
CPO prices in the year and the linkage between the CPO
market and the prices required to purchase crop, either
from the Group’s associated scheme smallholders, or
from independent suppliers. Combined with this, the
Group experienced challenges in several locations during
the year in securing independent crop of acceptable
quality which, inevitably, pushed up unit costs at times.
Mill management worked vigilantly to monitor supplies to
minimise the effect of this, whilst trying to balance cost
and mill utilisation.
COMPONENTS OF COST PER TONNE (PERCENT)
15%
Other
Head office
7%
Other
8%
75%
Field
Labour
33%
Fertiliser
12%
Depreciation16%
Other
14%
10%
Mill
Labour
3%
Depreciation 5%
Other
2%
21
STRATEGIC REPORT
OPERATIONS
PLANTING
Alongside its ambition to expand by purchasing further
planted hectarage close to its existing estates, the Group
continued to grow by planting additional areas, in a
sustainable manner, in its existing properties, to ensure
that yields can be maximised and that the Group is doing
all it can to supply Group-harvested crop into its own
milling facilities. In all cases, agreed land compensation
was paid to members of the local community before any
planting took place, based on the principles of free, prior
and informed consent. Furthermore, planting only took
place on environmentally suitable land, monitored by the
Group’s sustainability team, and in full compliance with
the principles set out by the RSPO.
At the Musi Rawas estate in South Sumatra, the Group
was able to plant a further 500 hectares during 2024 for
itself and for the scheme smallholders, bringing the total
planted area to over 10,800 hectares. The Group expects
to surpass the revised 11,000-hectare target in 2025, and
will continue planting thereafter.
As previously reported, when the Group acquired an
additional 2,100 hectares at Simpang Kiri in 2023, it was
based upon the expectation of replanting approximately
half the acquired area to support the estate’s long-term
crop growth. By the end of 2023, the Group had replanted
approximately 1,000 hectares. Whilst this replanted area
will take time to start yielding and thereafter to reach full
maturity, this investment puts the Simpang Kiri estate in a
strong position to achieve future growth.
Also in 2023, the Group acquired over 8,000 planted
hectares in East Kalimantan which have now become part
of the enlarged Kota Bangun project. Since acquisition,
management has been working with the Group’s
environmental consultants to determine whether further
planting may be possible in the acquired areas. Towards
the end of 2024, several environmentally suitable areas
were identified, and a planting programme began just
before the end of the year. The Group aims to complete
1,000 hectares of additional planting before the
end of 2025.
In North Sumatra, routine replanting in the mature
plantations around the Pangkatan mill continues, with a
further 250 hectares replanted in the year. In addition, in
northern Sumatra (both at Pangkatan and Simpang Kiri),
the Group has continued to support the formation and
planting to oil palm of additional smallholder schemes,
with a further 250 hectares planted in the year bringing
the total to 1,600 hectares. This, relatively new, project is
starting to ‘bear fruit’ with a total crop of 6,000 tonnes in
2024 and an acceleration in production is expected in the
coming years as more areas come into maturity.
ASSOCIATED COMPANY: KERASAAN
The Group continues to have a 38% investment in its
associated company, PT Kerasaan Indonesia (“Kerasaan”),
which is the owner of a 2,300-hectare oil-palm estate in
North Sumatra. During 2024, Kerasaan achieved a total
crop of 45,900 tonnes, 5% lower than the 48,200 tonnes
in the previous year, but its financial results were boosted
by the beneficial price environment when selling its crop
for processing. The estate is also continuing to invest for
the future, replanting 260 hectares (more than 10% of its
productive area) during the year, as well as preparing a
further area for replanting in 2025.
Strategic report continued
Oil-palm seedling nursery at Simpang Kiri
22
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
The Group had six mills in
operation throughout 2024.
The Kota Bangun project
has two mills, Bumi Permai
(pictured here) and Rahayu.
There is a single mill at
each of the Bangka,
Pangkatan, Bumi Mas and
Musi Rawas estates.
23
STRATEGIC REPORT
OPERATIONS
66,100
hectares,
Group
& scheme
smallholders
2023: 65,500 hectares
20.9
tonnes per
hectare
2023: 23.3 tonnes
1.6m
tonnes
2023: 1.6m tonnes
Planted hectarage
The total planted
hectarage managed
by the Group is a good
indicator of its ability
to continue producing
strong crop.
Ffb yield per
hectare
The rate at which
the Group is able
to generate ffb
from the mature
planted hectarage it
manages is the most
important measure of
agricultural efficiency.
Ffb crop
The total crop
available for milling,
whether harvested
or purchased, is
the key input in
determining CPO and
PK production.
The Group uses
key performance
indicators at all
levels, both in
Indonesia and in
the UK, to assess
its plantation
operations and to
direct management
effort in supervising
those operations.
Performance evaluation
Group management, including the board, monitors
performance in a number of different ways, using different
metrics and different forms of analysis. Inevitably, a
significant amount of focus is placed upon operational
and financial data, but in recent years there has been
an increasing acknowledgement of the importance of
understanding, formalising, tracking and actively managing
information from a broader range of sources. These
include, amongst others, data relating to environmental,
social and governance matters, health and safety,
employee wellbeing and performance, and stakeholder
engagement. Some of this information is included in this
performance evaluation section, whilst other relevant
information is included elsewhere in this report, on the
Group’s website, and in the other reports (such as those
on TCFD and ESG) published separately by the Group.
The Group recognises the primary importance of the
amount of planted hectarage under management. Having
invested in a significant amount of milling capacity, the
Group’s strategy is to reduce its reliance on purchasing
crop from outside suppliers to maximise the use of
those mills, and to continue increasing the proportion
by which they can be filled from the areas harvested by
the Group. To that end, the Group continued to plant new
areas during the year, and the area under management
increased to 66,100 hectares. Based on the established
planting programmes, this area is expected to grow once
again in 2025. Alongside this, management continues to
pursue opportunities to grow by acquisition.
The productivity of each planted hectare determines
how much Group-harvested crop can be supplied to the
Group’s milling facilities. On average, the Group had more
hectares producing throughout 2024 than in the previous
year, as over 10,000 hectares were purchased during the
course of 2023. However, as was known upon purchase,
those areas were not as productive as the high-quality
estates already under Group control, and hence they have
diluted the average yield per hectare in 2024 (having
not been included in the 2023 calculation as they only
contributed for part of the year). Furthermore, climatic
conditions outside the Group’s control, as discussed in the
crop section on pages 16 and 17, suppressed crop levels
across Indonesia in 2024. As a result, yield per hectare
reduced to 20.9 tonnes in 2024. However, with more
hectares in production, the Group was still able to process
a total of 1.6 million tonnes of ffb in the year, the same
as in the previous year, with almost all of that crop being
processed in a Group mill.
Combined with the yield per hectare, the oil-extraction
rate determines how much CPO the Group is able to
produce and sell, and so Group and mill management
prioritise maximising the amount of oil that can be
produced from each tonne of crop supplied to the mill.
24
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
OPERATIONS
US$ 410
per tonne of
palm product
2023: US$427 per tonne
4.8 tCO2e
per tonne
CPO produced
2023: 5.9 tCO2e
7.1
incidents
2023: 7.5 incidents
Extraction rates
The efficient running
of the Group’s own
mills increases
the output of CPO
available for sale.
Cost per tonne of
palm product
Managing unit costs,
particularly for
production from the
Group’s own areas, is
a key determinant of
profitability.
Carbon intensity
The carbon intensity
of Group operations
provides a single-figure
indicator of progress
towards the Group’s
net-zero targets.
Incident frequency
The Group’s incident
frequency rate
(expressed using a
standard multiplier
of 200,000) provides
an indicator of the
Group’s commitment
to health and safety
at its estates.
23.2%
oil-extraction
rate
2023: 23.4%
Doing this is a collaborative task, and requires careful co-
ordination between the agronomic and engineering teams.
Crops need to be harvested at the optimum ripeness and
sent promptly to the mill for processing. The mill needs
to take this crop, in combination with any purchases from
outside suppliers which have been reviewed carefully for
their acceptability, and minimise any losses through the
various stages of milling. Despite the climatic challenges
referred to earlier in this strategic report, which had an
adverse effect on extraction rates in some locations, the
Group achieved a commendable average oil-extraction
rate in its mills of 23.2% during the year, only marginally
down on the previous year.
As reported in the costs section above, the Group’s
primary measure of its cost effectiveness is its cost per
tonne of production. Management monitors costs in
both estates and mills, along with associated indirect
costs charged into cost per tonne, to ensure that the
Group operations run efficiently and that unit costs
are minimised as far as possible whilst maintaining
a commitment to excellence, high standards, and the
appropriate levels of investment in current and future
productivity. During 2024, unit costs for crop harvested
from Group-owned hectarage decreased by 4% to
US$410 per tonne.
The Group is a responsible producer of sustainable palm
oil, and as part of its commitment to acting responsibly,
it has set targets on carbon reduction. More information
is included in the sustainability section of this report on
pages 33 to 34 and, in particular, the Group monitors its
carbon intensity, measured as the total carbon emissions
(both within the Group and in its supply chain) per tonne
of CPO produced. The Group made another step forward
in 2024, reducing carbon intensity to 4.8 tonnes CO2 per
tonne CPO, and continues to be on track with its total
carbon-reduction plan.
The health and wellbeing of the Group’s workforce and
those living on its estates is a fundamental priority for
the Group, and the Group is committed to providing
high-quality facilities to the communities living on its
estates. For further details, see pages 38 to 39 of this
report. The Group has a dedicated health and safety team
with representatives present at all its estates. They are
responsible for delivering training, sharing best practice,
and ensuring that safe and secure working practices are
embedded into the Group’s normal operating procedures.
In addition, the health and safety team monitor any
incidents occurring, and identify any areas requiring
additional training. There were no work-related fatalities
during the year (2023 nil), and the incident frequency rate
was 7.1 (measured using a standard health and safety
multiplier of 200,000), meaning that for every 200,000
hours worked at Group locations, there were 7.1 incidents
during the year, down from the 7.5 reported in 2023.
25
Current trading and prospects
The Group experienced good cropping levels from the areas managed for itself and on behalf
of its associated scheme smallholders during the first two months of 2025, and almost all
locations are ahead of the same period in 2024. Total crop harvested from Group-owned
areas was up 5%, and crop from associated scheme smallholders up 16%, on the first two
months of 2024. Rainfall levels have been encouraging in most locations, although dry
weather did continue in the latter part of 2024 and into early 2025 in some areas of East
Kalimantan. As is always the case, the Group’s geographic diversity across much of Sumatra
and East Kalimantan will continue to be of benefit, particularly when it comes to the
variability of weather patterns.
Continuing the trend observed in 2024, the Group purchased a lower level of crop from
outside suppliers in the first two months of 2025, down by 33%, once again reflecting both
the cost and quality constraints. At the same time, this was consistent with the Group’s plans
to manage the mix of crop being processed in its mills, and to take considered steps to
manage and enhance Group margins.
Overall, total crop processed in the first two months of 2025 was 239,600 tonnes. Details are
set out in the following table:
2 months
ended
28 February
2025
Tonnes
Increase/
(decrease)
%
2 months
ended
29 February
2024
Tonnes
Own crops
150,100
5
143,600
Scheme-smallholder crops
50,000
16
43,200
Independent crops purchased
39,500
(33)
58,900
239,600
(2)
245,700
As reported above, the Group achieved an average mill-gate price for its CPO of US$823 per
tonne in 2024, which was 13% higher than in the previous year. Whilst prices fell somewhat
in the early part of 2025 from their elevated levels seen towards the end of 2024, pricing has
remained strong, and the Group continues to receive mill-gate prices higher than the average
achieved for 2024. The average tender price for the Group’s CPO in the first two months of
2025 was approximately US$870 per tonne.
The Group is continuing to plant new hectares, both for itself and for scheme smallholders,
in Sumatra and East Kalimantan, in early 2025. It is taking steps towards further planting as
the year progresses, including agreeing land compensation, preparing areas for planting, and
readying planting material in on-site nurseries. As a result, the total planted area managed by
the Group will increase once again during 2025. Alongside these efforts, the Group is working
hard to secure further planted areas through acquisition, and the Group’s healthy balance
sheet and significant net funds puts it in a strong position.
Based on the encouraging start to 2025, the immediate and longer-term prospects, the board
remains firmly of the view that sustainable palm oil, as a high-yield and low-cost product, will
continue to be in demand and offer attractive returns, and that, as a result, the prospects for
the Group remain very positive.
Strategic report continued
26
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
OPERATIONS
Operations:
Malaysian
property
ASSOCIATED COMPANY:
BERTAM PROPERTIES
The Group’s 40%-owned associated
company, Bertam Properties Sdn Bhd
(“Bertam Properties”), continued with
the same activities during 2024 of
developing and selling high-quality
residential and commercial properties.
Bertam Properties’ development area
is located in an attractive location, near
to the town of Kepala Batas in the state
of Penang, Malaysia. Given the timing of
some development completions, sales
volumes were slightly down on the
previous year, with 98 property sales
(2023 — 164). However, the company,
along with its subsidiary, Penang Golf
Resort, still achieved revenue of
US$20 million (2023 — US$24 million)
and, once again, distributed a dividend
to the Group.
Bertam Properties continues to hold a
valuable land bank, amounting to 195
hectares at the end of the year, some of
which was under development for future
property sales. In addition, Penang
Golf Resort also owns the valuable and
attractive 103-hectare 18-hole golf
course adjacent to some of the property
development.
Newly built housing at
Bertam Properties
27
RISK
IMPACT
MITIGATION
OPERATIONAL
1 Adverse weather
One or more of the
Group’s operational
locations suffers
from adverse weather
conditions.
HIGH MED
Yields may be lower than
anticipated if weather
conditions are too wet
or too dry, causing lower
crops or difficulties in
harvesting.
The Group accepts that weather patterns can vary over the short term,
and this may include extended periods of dry weather caused by weather
phenomena such as El Niño. Its experience of developing and managing
oil-palm estates in Indonesia over several decades shows that any crop
deficits tend to be made up over the longer term. In addition, the Group
benefits from the geographical diversity of its operations within Indonesia.
2 Climate change
Group estates start to
feel the impact of long-
term changes in climate
patterns.
MED HIGH C
Changing weather
patterns may result in
changing yield profiles
on the Group’s oil-palm
estates.
The Group is alert to changing climate patterns around the world. To date,
there has been no major impact on Group operations, but the Group
continues to monitor the situation on each of its estates. The Group has
assessed climate risk over the medium to long term (up to 2050) and
over climate-warming pathways of over 3°C. Further information on the
assessment of climate risks is included in the sustainability section of this
report on pages 32 and 33, along with steps taken by the Group to manage
and mitigate any impact. Changing weather patterns have been assessed
as the Group’s principal physical risk associated with climate change.
Risk management
The Group regularly considers its principal risks. They are reviewed and assessed
by the audit committee at least annually and reported to the board for approval. The
board considers the principal risks when conducting strategy reviews or when making
strategic decisions.
During 2024, the Group held regular meetings to review existing and potential new risks relating to all aspects of the
Group’s operations. Initial responsibility lies with the head of risk management, based in the Jakarta head office, and
he ensures that input is obtained from all parts of the business. The chief executive either attends risk review meetings
or is briefed on their output by the head of risk. Risk mitigation strategies are considered, and ratings are allocated to
each risk net of mitigation. Some additional support is obtained from the Group’s external consultants when discussing
climate-related risks, given the importance and specialist nature of this risk area. When the Group started to consider
climate-related risks in detail, they were monitored separately, but in 2024 these risks have been fully integrated
into the Group’s main risk register. The management team, in conjunction with the audit committee, review the risks
identified for those of most significance to the Group, and these are treated as principal risks. Where principal risks in
the list below are climate related, they are marked as such. Whilst some new risks have been identified in the current
year, no risks have been added to, or removed from, the list of principal risks. Two risks have been upgraded during the
current year, relating to the Indonesian and international regulatory environments, given the change in government
in Indonesia along with new requirements in certain international markets, notably the EU, as discussed further
below. Notwithstanding these changes, the board remains of the view that the most significant risk to the Group is a
substantial fall in the commodity prices for CPO and PK.
KEY
Likelihood of occurrence
Impact on the business
Risk change from prior year
INCREASE
DECREASE
NO
CHANGE
NEW N
Climate-related risk
C
LOW
MED
HIGH
LOW
MED
HIGH
Impact on the business
HIGH
7 10 11
2 13
5
MED
9 12 15
3 8 14 16
1
LOW
17
4 6
LOW
MED
HIGH
Likelihood of occurrence
28
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
RISK MANAGEMENT
RISK
IMPACT
MITIGATION
OPERATIONAL (CONTINUED)
3 Flood and water incursion
One or more of the
Group’s planted areas
suffer a significant flood.
MED MED C
Depending on severity,
immature palms are at
risk in flooded areas,
whilst mature palms are
difficult or impossible to
harvest, reducing yield
from those areas.
Some of the Group’s estates are more prone to flood risk than others, due
to their location and topographical conditions. Planting programmes are
planned and timed carefully to mitigate risk, and the Group has invested in
water management systems, including bunding and drainage systems, as
well as water pumps to evacuate excess water.
4 Pests and disease
Group planted areas
are attacked by pests or
infected by disease.
MED LOW
Whilst a remarkably hardy
plant, the oil palm can
still be subject to attack
from pest and disease,
reducing yield from
affected areas.
The Group employs experienced agronomic managers in all its estates
and takes advice from external consultants when appropriate. Effective
management is designed to identify issues when they occur, and to ensure
that they do not become widespread. Senior staff remain up to date in
latest agronomic practices.
PRODUCTION AND SALES
5 Change in prices
There is a significant fall
in commodity pricing for
CPO and PKO.
HIGH HIGH
A fall in commodity
prices would result in a
reduction in mill-gate
prices received by the
Group for its output.
The Group accepts that it is dependent on its ability to sell its output into a
world market over which it has no control. However, oil palm is a permanent
tree crop and is the cheapest major vegetable oil to produce, with Indonesia
being the lowest cost producing country. The Group employs a dedicated
marketing team to monitor developments in the market and to ensure that
it receives the best available prices for its sales tenders and other supply
agreements.
FINANCIAL
6 Exchange-rate fluctuation
There is an adverse
impact in the Indonesian
Rupiah exchange rate.
MED LOW
Adverse exchange rate
movements can impact
upon Group costs and
the value of locally held
assets.
Exchange rate risk is mitigated at least in part as the Group’s functional
currency is USD and both its revenue and significant proportion of its
costs are USD related. Local costs denominated in IDR are lower in USD
terms when the IDR weakens, but at the same time assets held in IDR
devalue, whilst the opposite holds when the IDR strengthens against USD.
Management have concluded that, other than seeking to hold surplus cash
balances in USD as far as possible, any other formal hedging mechanisms
would be difficult to achieve and unlikely to be cost effective.
7 Inflation
There is a significant
increase in Group costs
due to inflationary
pressures.
LOW HIGH
Increasing input costs
adversely affect cost per
tonne and, by extension,
operating margins.
The Group operates a centralised purchasing team, based in Jakarta, that
is responsible for all major procurement, supported by regional offices
dealing with local suppliers. Tenders are well controlled and subject
to multiple reviews. Unit costs benefit from increasing yields, whilst
inflationary pressure on key inputs such as fertiliser can feed through to
cost per tonne.
8 Taxation
The Group is unable to
agree its tax accounting
with local tax authorities.
MED MED
The Group is subject to
an additional tax liability.
In all cases, the Group is committed to complying with relevant tax
legislation and to paying taxes that are due. The Group employs a
dedicated tax specialist team and works with external tax consultants
where necessary to advise on complex areas.
29
Strategic report continued
RISK
IMPACT
MITIGATION
PEOPLE
9 Succession planning
The Group fails to focus
on the development of
its senior management
group and planning for
succession in key roles.
LOW MED
The Group relies on the
experience and expertise
of its senior management
group, without whom the
Group risks a reduction
in corporate oversight
and its high operating
standards.
Succession planning for the senior management group is identified as
a priority area and is discussed on a regular basis by the Group board.
Wherever possible, early discussions are held with staff members to
discuss their plans along with opportunities for future development. The
continuing growth of the Group has allowed for scope to provide new
learning and development for staff.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
10 Environmental obligations
The Group fails to
comply with its own
policies, or with legal or
regulatory obligations, on
environmental protection.
LOW HIGH C
A failure to comply
with environmental
obligations may lead
to environmental loss,
reputational damage,
remediation costs and
potential fines.
The Group applies its well-established policies on the development and
operation of sustainable oil-palm estates. It has a separate sustainability
team, including staff members resident at all its operating sites. The Group
is a long-standing member of the RSPO and is subject to their independent
audit and scrutiny. Given the increasing importance placed on this area by
a number of stakeholders, this has been identified as the Group’s principal
climate-related transition risk, see page 33.
11 Relationship with local populations
Operations are disrupted
by a breakdown in
relations with local
populations around
Group estates.
LOW HIGH
Disruption around
Group estates, including
workforce problems or
transport difficulties,
could lead to a slowdown
or even stoppage in
Group production and,
potentially reputational
or other damage to the
Group.
Careful attention is paid to the Group’s relationship with local
populations around Group estates, including regular engagement with
local government, mayors and village representatives. The smallholder
co-operative schemes, which are associated with all Group estates, play
an important part in aligning the interests of the Group and the local
community, and the Group works hard to ensure that the mutual benefits
of co-operative participation are well understood.
12 Reporting obligations
The Group fails to comply
with obligations to
provide external reporting
on ESG data and analysis.
LOW MED C
The Group may be subject
to regulatory challenge,
or have concerns raised
by investors if necessary
ESG data is missing
from reporting or
failing to meet investor
expectations.
There have been, and continue to be, significant changes in the regulatory
environment around ESG in recent years, and the obligations to capture
and report data are only expected to increase. The Group works with
advisors, monitors guidance, and plans its disclosure in annual reports,
standalone documents and through the website, with the objectives
of meeting its obligations and to providing useful information to its
shareholders. The Group has published separate TCFD and GRI-aligned ESG
reports, and plans are in place for further reporting.
30
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
STRATEGIC REPORT
RISK MANAGEMENT
RISK
IMPACT
MITIGATION
POLITICAL AND REGULATORY
13 Indonesian regulatory environment
The Indonesian
government introduces
new laws or regulations
which adversely affect
Group operations.
MED HIGH
A change in the legal or
regulatory environment
in Indonesia could result
in a reduction in Group
profitability due to lower
pricing, higher taxes, or
some other impact.
The Group has a very long history of operating in Indonesia, and during
that time the country has benefited from a period of political stability
and economic growth. Inevitably some changes occur which influence
the Group’s operations, but the Group monitors these and reports them
to shareholders as required. In 2024, Indonesia elected a new president,
and the Group is continuing to monitor the political and regulatory
environment as the new president and new government becomes
established.
14 International regulatory environment
New laws or regulations
are introduced by
governments or
regulatory bodies
outside Indonesia which
adversely affect Group
operations.
MED MED
A change in the global
legal or regulatory
environment could result
in a reduction in Group
profitability due to lower
export demand, increased
regulatory burden, or
some other impact.
Whilst Indonesia is the largest producer of palm oil in the world, the
majority of production is exported. As a result, the Indonesian palm-oil
industry is reliant, to a degree, on continuing demand from, and access to,
international markets. Lawmakers and regulators in some countries are
introducing new requirements which are affecting, or will impact on, palm
oil (e.g. EUDR). The Group continues to monitor changes in international
regulations, and seeks to ensure that, through its commitment to
responsible and sustainable production, it can demonstrate compliance
with international regulations.
15 Bribery and corruption
Operations in Indonesia
are deemed to be at a
higher risk of bribery and
corruption.
LOW MED
Inappropriate activities
could lead to both legal
sanction and a loss of
reputation.
The Group has a robust policy on bribery and corruption, completes risk
assessments and conducts training of senior management and staff in all
locations. It requires all its business partners to complete questionnaires
on their respective anti-bribery and anti-corruption activities and policies,
and includes appropriate clauses in contracts. The Group has experienced
staff at its Jakarta head office and has an independently operated
whistleblowing hotline to facilitate anonymous reporting of any issues.
16 Land rights dispute
There is a dispute over
land rights between
the Group and another
interested party.
MED MED
If the Group is unable to
defend its land rights, a
loss of planted hectarage
would have a knock-
on effect to crop and
production.
At times, the Group is subject to claims from others who seek to
demonstrate an interest in the Group’s planted areas. This can be more
prevalent when commodity prices are high, not just for CPO, but other
competing commodities when claimants see other potential uses for
Group land. The Group’s legal team, supported by advisors as necessary,
robustly defend the Group’s land rights, and in all cases the Group is
satisfied that it holds the proper title to its planted areas.
INFORMATION SYSTEMS
17 Information security
Group IT systems are not
sufficiently secure.
LOW LOW
Proprietary or sensitive
information is shared
outside the Group, either
as a result of accidental
loss or malicious cyber
attack.
A Group-wide information management and reporting system has
been deployed, and an in-house IT team works closely with retained IT
consultants to ensure that Group data remains secure. Access controls
have been established, and core data is stored in a secure ‘cloud’
environment. Continuous backups are made of Group information both to
cloud and physical storage.
Approved by the board of directors and signed on its behalf.
Matthew Coulson
Chief executive
25 March 2025
31
Sustainability
The Group is committed to the production of certified sustainable palm oil, and has
sustainability at the core of its strategic and operational decision-making.
INTRODUCTION
The Group is committed to being a responsible producer
of certified sustainable palm oil. As explained elsewhere in
this annual report, after a period of significant investment,
the Group operated six efficient palm-oil mills throughout
2024, all of which produced and dispatched certified
output. For the first time in 2024, the Group produced
more than 250,000 tonnes of certified sustainable palm oil,
representing almost 70% of its output, and five of its six
mills had been RSPO accredited by the end of the year.
The final mill has been audited, and the certification is
expected in 2025.
The Group is committed to transparency in everything it
does. This is shown in its rating from the Zoological Society
of London in their SPOTT palm oil Environmental, Social
and Governance (“ESG”) transparency assessment, which
increased to 88.9% in 2024, ranking the Group 13th out of
the 100 companies reviewed. The Group has complied with
Climate-related Financial Disclosures, as shown on page
34, and provides more detailed information in accordance
with the guidelines of the Taskforce for Climate-related
Financial Disclosures (“TCFD”) and on ESG matters in the
Group’s separate TCFD and ESG reports, which are available
from its website.
CLIMATE GOVERNANCE
The Group board retains primary responsibility for
climate governance and, in fulfilling their responsibilities,
members of the board seek to take the interests of
all stakeholders into account. The Group’s strategic
priorities are clear, and all Group activities are based
around acting as a responsible producer. The effects of
climate change continue to be a pressing concern as
the world acknowledges the need for urgent action. The
board recognises that the Group has a part to play in
demonstrating a willingness to change for the benefit of
its employees, customers, shareholders and members of
the wider community. This report, along with the Group’s
separate, more detailed TCFD and ESG reports, seeks to
explain how the Group has responded to its commitments
as a responsible operator, and to highlight its work on
carbon-reduction plans.
The board engages with specialist advisors, who provide
board briefings, and who provide additional support on
data analysis, risk assessment and disclosure compliance.
The board has decided not to establish a separate ESG
committee given the importance of sustainability and
climate matters to the Group’s wider strategy. With this
in mind, these topics are discussed at all main board
meetings, and relevant points are communicated with
management by the chief executive, who takes primary
responsibility in this area at an executive level. The chief
executive is in frequent communication with the Jakarta-
based sustainability team, as well as the head of risk, to
share information and to learn about any issues arising
at a local level. These meetings are supplemented by the
chief executive’s regular visits to Jakarta and to the Group’s
operating locations.
STRATEGY
The Group’s strategy is described in detail in the strategic
report on pages 12 to 31. A fundamental part of that
strategy is to act responsibly, maintaining a sustainable
business that can thrive in the long term, minimise
environmental impact and be resilient to changing external
conditions. The Group’s existing policies, supported by
its membership of the RSPO, put it in a strong position.
It has commitments to no deforestation, no burning, and
has a zero-waste mentality across all operating locations.
The Group is committed to setting aside environmentally
valuable land to be conserved and, in 2024, with the
addition of the mangrove forest area at Bumi Mas (see
page 35), the Group achieved its target of having at least
10% of the total planted area under its management set
aside to be monitored, managed and conserved, and is
committed to maintaining this proportion in the future. The
Group’s commitment to sustainability standards guides
it in strategic decision-making, including when assessing
potential new planted areas for acquisition.
RISK MANAGEMENT
The Group has a well-established process for the
identification, evaluation and management of risks across
the organisation. See pages 28 to 31 for more detail in this
area. For certain, specialist areas, including in relation to
sustainability and climate change, the Group may include
external support in the identification and evaluation of
risks, but managing them remains a Group responsibility.
During 2024, the Group has taken steps to integrate the
management of climate-related risks into the main Group
risk register. To achieve this, the sustainability team worked
closely with the Group’s head of risk to ensure that all
climate-related risks, along with ratings and mitigating
steps, were documented in the risk register, and that
climate risks were included as part of regular risk reviews.
32
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
SUSTAINABILITY
Identification
The Group holds regular workshops on risk, both climate-
related and other, to consider both new and emerging
risks, to reflect on changes in risk classification, and to
identify instances of recent risk occurrence. To support
the process for climate-related risks, the Group’s
specialist consultants facilitated some of the discussion
in 2024. A wide range of factors was considered, including
regulatory requirements, technological changes, and
the potential for impacts on areas such as productivity,
infrastructure, health and safety, reputation, markets
and supply chains. Risks were classified as ‘physical’ or
‘transitional’. Physical risks arise from climate events,
whilst transitional risks from the need for action to move
away from fossil-fuel reliance.
Evaluation
Each climate-related risk was evaluated based on its
likelihood and impact, and the ones considered to
be most significant have been included as part of the
Group’s principal risks in the section on pages 28 to 31,
but separately designated as climate-related risks. The
Group’s most significant physical risk is considered to be
increases in average temperatures (see risk 2 on page
28) and its most significant transitional risk relates to
environmental obligations (see risk 10 on page 30). Whilst
the Group did identify some climate-related opportunities
during the year, none were considered to be principal to
the business, and so they have not been included in the
risk section on pages 28 to 31.
Management
Mitigating actions have been identified, as far as possible,
for each of the climate-related risks, and they remain
under review given that risks evolve and change. Whilst
the impact on the business for each principal climate-
related risk is described in the risk management section
on pages 28 to 31, none of those risks are considered
to have an overall impact on the underlying resilience
of the Group’s business model, irrespective of potential
climate scenarios. The Group’s sustainability team has an
important role to play in managing risk, or in supporting
operational management to implement risk mitigation
strategies in the Group’s operating locations. In 2024,
the Group worked hard to respond to the impact of the
dry weather conditions that were evident across much of
Indonesia, and this is discussed in the strategic report on
pages 12 to 31.
METRICS AND TARGETS
As part of the Group’s commitment to sustainable
operation, it monitors a range of metrics and targets in
support of achieving its goals. The Group monitors carbon
intensity measured as the amount of CO2 emissions,
both internally and in its supply chain, per tonne of CPO
produced. It also reports a carbon balance sheet and is
committed to achieving net zero emissions by 2050. To do
this, the Group’s net-zero targets have been established
with reference to Science-Based Targets, requiring a 90%
reduction in industrial emissions, with the remaining
10% offset by high-quality carbon removals, and a 72%
reduction in what are referred to as ‘FLAG’ emissions
(those associated with forestry, land use and agriculture).
In addition, as previously reported in the Group’s
TCFD report, the Group established a target to secure
conservation land, managed and monitored by the
Group’s sustainability team, representing at least 10%
of the planted hectarage cultivated by the Group. Having
secured the mangrove forest area adjacent to the Bumi
Mas estate (see case study on page 35), the Group
achieved this target during 2024.
Water sampling
in sandy area as
part of Bangka
biodiversity
project
33
Sustainability continued
Reducing our greenhouse gas emissions
The Group, supported by specialist consultants, has
continued to work on reducing its total greenhouse-
gas emissions during the year. In accordance with
TCFD guidance, and calculated in accordance with the
Greenhouse Gas Protocol, the Group measures emissions
in three categories, scopes 1, 2 and 3. Scope 1 emissions
arise from the Group’s own operations, scope 2 from
electricity purchased to power those operations, and
scope 3 from indirect activities outside the Group, most
notably the onward processing of the Group’s products.
Whilst not all emissions are carbon dioxide (CO2), for
ease of comparison, they are converted to equivalent
amounts of CO2 and reported as tonnes of CO2 equivalent,
or ‘tCO2e’.
During 2024, scope 1 emissions have remained similar to
the previous year, despite the increase in hectarage, and
scope 2 emissions continue to be low, given the internal
power generation from the Group’s own renewable energy
biogas facilities. Scope 3 emissions have fallen as the
Group has continued to work both with customers and
with its consultants to understand better the onward
processing activities undertaken, and their related carbon
costs. From the Group’s baseline year of 2021 for carbon
reporting, there has now been a 36% reduction in total
emissions, and the Group has already achieved its interim
target of a 28% reduction by 2030 as part of its overall
2050 net-zero target.
Intensity measures
The Group measures carbon intensity as a way of
analysing its emissions and, as a key performance
indicator, calculating the total carbon emissions per
tonne of CPO produced, as well as measuring the same
figure per tonne of palm product. By the end of 2024,
the Group’s total carbon intensity per tonne of CPO had
reduced from the 2021 baseline figure of 8.9tCO2e to
4.8tCO2e and per tonne of palm product from 7.3tCO2e to
3.9tCO2e.
NEXT STEPS
The Group is continuing to work with customers and
suppliers on understanding their own operations in more
detail and to ensure that it is encouraging low-carbon
and efficient practices within its supply chain. At the
same time, the Group continues to work within its own
operations on sustainable and responsible practices,
some of which will have carbon benefits for the long
term. Further details will be provided in future reports.
2024
tCO2e
2023
tCO2e
2022
tCO2e
2021
tCO2e
Scope 1
199,700
203,900
194,200
188,000
Scope 2
700
600
500
400
Scope 3
1,589,300
2,046,700
2,275,200
2,594,400
Total
1,789,700
2,251,200
2,469,900
2,782,800
Change from baseline year
36%
19%
11%
CLIMATE-RELATED FINANCIAL DISCLOSURES
The board is mindful of its obligations under s414 of the Companies Act to provide Climate-related
financial disclosures within the annual report, and provides details here of how it has complied with the
disclosure requirements of CA2006 s414CB2(A). Part (a), relating to governance arrangements, is addressed
in the climate governance section on page 32. Parts (b) to (e) on risk-related disclosures are covered in
the risk management section on page 32, and also by cross-reference to the risk management part of the
strategic report on pages 28 to 31. Consideration of the business model’s resilience is also included in the
management part of the risk management section on page 33, in accordance with paragraph (f). Finally, the
requirements of parts (g) and (h) on targets and key performance indicators are considered in the metrics
and targets section on page 33.
34
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
SUSTAINABILITY
COMMUNITIES
Mangrove forest, Bumi Mas
CASE STUDY
Bumi Mas mangrove forest
The Group’s Bumi Mas estate is located in
a rural, and relatively remote, location in the
coastal region of East Kalimantan.
For some time, Group management had been aware of a
significant amount of mangrove forest situated between the
estate and the sea, and it became clear that the mangrove
area was not being actively managed or conserved.
Mangrove forests are environmentally important for many
reasons, including for their biodiversity benefits but, in
particular, they sequester a significant amount of CO2.
Therefore, conserving and preserving them is extremely
important.
After a significant amount of work by the management
team at Bumi Mas, the Group’s sustainability team, and with
the support of senior management, the Group has worked
successfully with the local community and with the relevant
local authorities to secure the right to manage and conserve
an area of approximately 1,400 hectares of mangrove forest
around the Bumi Mas estate. Whilst it doesn’t form part of
the Group’s carbon balance sheet, it is estimated that over
500,000 tonnes of CO2 are sequestered within this area.
By adding the Bumi Mas mangrove to the other conservation
areas, both at Bumi Mas and at all the other estates, the
Group now has a total of 8,000 hectares of conservation
land, representing 12% of its total planted area.
35
35
The Group recognises the important part it has to play within the
communities in which it operates. Each of its estates has continued
to develop and grow over many years, to the point that, at the
end of 2024, the Group managed over 66,000 planted hectares.
It has over 12,000 employees, but the Group’s community impact
is far wider, as the number of people living on Group estates is
larger than the number of employees, at approximately 18,000.
In addition, the Group works with a significant number of crop
suppliers, including the associated scheme smallholders and
independent smallholder farmers who are resident around the
Group’s estates and, when necessary, it employs contractors to
work on specific projects.
Over many years, the Group has worked in close partnership
with its associated scheme smallholders. It has supported the
formation of co-operative schemes to enable members of the local
communities around Group estates to participate in ownership of
smallholder plantings. The Group has also been a willing initial
finance partner for planting of smallholder areas. Developing
oil-palm projects is capital intensive and requires a long-term
approach, and the Group has always been willing to make initial
funding available, even to the extent of providing an income to co-
operative members whilst plantings remain immature. By the end
of 2024, the Group’s associated smallholders owned over 16,000
planted hectares, a very valuable asset.
The Group also promotes sustainable palm-oil practices amongst
independent smallholders, and assists them in gaining access to
certified sustainable palm-oil markets. In Bangka, the Group is
supporting approximately 650 smallholder farmers, representing
approximately 4,000 planted hectares, with certification under
the RSPO independent-smallholder scheme to produce certified
sustainable ffb. This has been a significant undertaking for the
Group. For several years, the Group has been providing training,
and administrative support, to the independent smallholders. In
addition, the Group acts for the smallholders in collating the details
of their certified supplies and then processing, collecting and
distributing their additional sustainability income.
Providing high-quality housing and other facilities for workers and
their families on all estates is an important priority for the Group.
A significant investment was made by the Group on the continuous
maintenance and enhancing of those facilities during the course of
the year, and management prioritises raising quality standards at
recently acquired estates. More details are on pages 38 to 39.
Communities
The Group takes an active interest in the welfare
of the communities living on and around its
operations, promoting trust and mutual support.
36
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
CASE STUDY
Bangka biodiversity project
The Group is committed to taking steps to
support and increase biodiversity across its
estates. As part of this commitment, a dedicated
biodiversity team was established on the Bangka
estate at the start of 2024 with objectives to
establish clear baselines, undertake research,
and embark upon pilot projects with support from
specialist consultants.
A number of projects have started during the year, including
the planting of native tree species around river borders and
around former mining ponds (as part of the Bangka estate is
rehabilitated ex-tin mining land) to encourage biodiversity and
reduce soil erosion. We are also piloting the creation of hedgerows
in unused land available underneath the power lines that run
alongside several estate roads. These power lines distribute the
Group’s renewable electricity from the mill to estate housing
and other facilities. By introducing a variety of beneficial plant
species, including those that provide food, flowers, and nesting
opportunities for wildlife, hedgerows can provide homes and
corridors for wildlife. Current trialling involves planting different
combinations of hedging stock to see what is most effective.
Already, some very positive results have been observed and work
will continue throughout 2025 and beyond.
Chief executive visit to Bangka biodiversity project with Nadia
Nafarisa Kamila, biodiversity co-ordinator
SUSTAINABILITY
COMMUNITIES
37
37
brighten back image,
enlarge biogas facility
image
Health
The Group has established 15 medical clinics
around its estates, and these are staffed by qualified
doctors and other medical professionals. Support
and care is available on a wide range of issues.
During the year, Group clinics completed almost
50,000 consultations.
Housing
The Group’s estate houses are all developed
based on high-quality, standard designs, in
community groups with access to local facilities.
There is a continual programme of renewal and
repair, in addition to which the Group built 100 new
houses. Approximately 18,000 employees and their
family members live on the Group’s oil-palm estates.
Commitment to the Group’s estate communities
38
The Group has oil-palm estates
spread across Sumatra and
East Kalimantan. A range of
facilities is provided at each
estate to ensure that workers,
and their families, enjoy the
benefits of living on a Group
estate and participating in
community life.
New housing development at Musi Rawas
38
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
38
Recreation
Community
Education
As part of its commitment to estate communities, creche
facilities for young children are available on all Group
estates. Where local schools are available near to
Group estates, the Group provides buses to take children
to and from schools. In the Group’s more remote
locations, both primary and secondary schools are
provided by the Group, and it now has approximately
1,300 school places for estate workers’ children.
Religion
Religion plays an important part in community
life at Group estates. In support of this, the
Group has provided places of worship for its
multi-faith communities throughout its estates.
Uniting estate communities is important, to
build and to strengthen the bonds between all
members of the Group’s broader community. The
Group has community halls and clubhouses on its
estates specifically for this purpose. In particular, the
opening of the Bumi Mas clubhouse in 2024 was a
success, and is enjoyed and well-used by staff there.
The Group provides a wide range of sporting
activities at its estates, encouraging broad
participation and promoting wellbeing amongst its
estate community. Sports programmes are in place
for young people through to more senior
age groups.
SUSTAINABILITY
COMMUNITIES
39
Report of the Directors
Peter Hadsley-
Chaplin
Chairman
Appointed a director
in 1989, chairman in
2010. Transitioned
from executive to non-
executive role in mid-
2024. Former executive
chairman of Bertam
Holdings PLC and
Lendu Holdings PLC.
Former chairman of
The Association of the
International Rubber
Trade. Prior to joining the
Group in 1988, he was a
commodity broker with C
Czarnikow Limited.
Matthew
Coulson
Chief executive
Appointed chief executive
in 2022, having been
finance director since
2017. Joined the Group
as chief finance officer
in 2016, with previous
experience as an audit
director of Deloitte
LLP, including work
on companies in the
agricultural sector and in
the technical policy team.
Luke Shaw
Chief financial officer
Appointed to the board
on 1 August 2023, having
joined the Group in July
2022 as chief financial
officer. Qualified
chartered accountant with
previous experience of
working with a wide range
of companies, including
international groups and
AIM-listed businesses, as
an audit manager at BDO
LLP. Prior to joining the
Group, held CFO position
at Servomex, a division
of Spectris plc, and has
significant experience in
financial and commercial
management.
Bruce Tozer
Senior independent
non-executive director
Appointed a director and
member of the audit and
remuneration committees
in 2016, and chairman
of those committees
since 2022. Has held
senior roles at JP Morgan,
Rabobank International,
and Credit Agricole.
Non-executive director
of Canadian-listed
Base Carbon Corp. He
consults in environmental
markets, commodities,
agribusiness investment
and ESG. Advisory roles
include lead adviser on
carbon at Singapore-
regulated Abaxx Exchange.
Will be retiring from the
board in June 2025.
40
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
K Chandra
Sekaran
Non-executive
director
Appointed director in
2021 and was president
director of PT Evans
Indonesia for over
15 years until 31 July
2023. Transitioned
from executive to non-
executive director in
August 2023. Began career
in Malaysia with Harrisons
and Crosfield and, from
1995, worked in Indonesia
as chief operating officer
for Sinarmas Plantations
before joining the Group.
Michael
Sherwin
Independent
non-executive director
Appointed a director and
member of the audit and
remuneration committees
in July 2022. Has over
40 years’ experience in
finance and leadership
roles, having originally
trained and qualified as
a chartered accountant
with Price Waterhouse.
A non-executive director
of Williams Motor Co.
(Holdings) Limited.
Was CFO of Games
Workshop plc for ten
years, followed by nine
years as CFO at Vertu
Motors plc. Held non-
executive directorships
at both Plusnet plc and
at Sumo Group plc where
he chaired their audit
committees.
Tanya Ashton
Independent
non-executive director
Appointed a director
and member of the
audit and remuneration
committees in August
2022. Has over 18 years’
experience working in
ESG roles. Currently
head of sustainability
at Walgreens Boots
Alliance, Global Sourcing,
Europe and is a board
member of global not-for
profit organisation The
Sustainability Consortium.
A non-executive director
of AIREA plc since May
2023. Previously held
senior positions at Silver
Spoon British Sugar plc,
part of Associated British
Foods.
Lee Yuan
Zhang
Non-executive
director
Appointed a director in
February 2023. Regional
director (Plantations) of
Kuala Lumpur Kepong
Berhad (“KLK”), Malaysia.
Former president director
of PT KLK Agriservindo,
Indonesia, responsible
for the management of
140,000 hectares of oil-
palm plantations across
five Indonesian provinces.
Has also held a number
of senior head office
roles, including senior
marketing and sales roles,
within the KLK Group.
41
REVIEW OF BUSINESS AND FUTURE DEVELOPMENTS
A review of the year and future prospects (including the
principal risks and uncertainties facing the Company)
is included in the chairman’s statement (pages 2 to
5) and in the strategic report (pages 12 to 31) and is
incorporated in this report by reference.
RESULTS AND DIVIDEND
Details of the results for the year are given in the
consolidated income statement on page 64.
An interim dividend of 15.0p (2023 — 12.5p) per share in
respect of 2024 was paid on 1 November 2024. The board
recommends a final dividend of 37.5p (2023 — 32.5p)
per share. This dividend will be paid on or after 19 June
2025 to those shareholders on the register at the close
of business on 25 April 2025. This final dividend is not
provided for in these financial statements.
SHARE CAPITAL
The Company has one class of share. Details of the issued
share capital of the Company are as follows:
Shares of
10p each
Issued (fully-paid and voting)
at 1 January 2024
53,289,690
Issued in respect of options
70,000
Bought back and cancelled
1,183,398
Issued (fully-paid and voting)
at 31 December 2024
52,176,292
The Company operated a share-buyback programme
during the year. Under that programme the Company
bought back and cancelled 1,183,398 (2023 — 991,198)
10p shares, representing 2.2% (2023 — 1.8%) of the
issued share capital, for a total cost of US$13.4 million
(2023 US$9.7 million).
DIRECTORS AND DIRECTORS’ INTERESTS
The present membership of the board is detailed on pages
40 and 41. All of the directors served throughout the year
and up to the date of signing these financial statements.
Peter Hadsley-Chaplin and K Chandra Sekaran will retire
from the board at the forthcoming annual general meeting
in accordance with the articles of association and, being
eligible, will offer themselves for re-election.
The directors serving at the end of the year, together with
their interests at the beginning of the year in the 10p
shares in the Company, were as follows:
Beneficial
Options
At 31 December 2024
P E Hadsley-Chaplin
2,147,801
-
M H Coulson
25,400
111,260
L A Shaw
-
31,201
B C J Tozer
-
-
K Chandra Sekaran
159,331
12,000
M Sherwin
4,750
-
T Ashton
-
-
Lee Y Z
-
-
At 1 January 2024
P E Hadsley-Chaplin
1,561,717
—
M H Coulson
20,000
83,933
L A Shaw
—
6,215
B C J Tozer
—
—
K Chandra Sekaran
145,181
35,000
M Sherwin
4,750
—
T Ashton
—
—
Lee Y Z
—
—
Further details of the directors’ interests in share options
are disclosed in the directors’ remuneration report, on
page 56.
None of the directors holds any beneficial interest
in, or holds options to buy shares in, any subsidiary
undertaking of the Company as at the date of this report.
Other than the advisory fee to K Chandra Sekaran
referred to in the remuneration table on page 55, no
director has had a material interest in any contract of
significance in relation to the business of the Company,
or any of its subsidiary undertakings, during the financial
year or had such an interest at the end of the
financial year.
As permitted by the Company’s articles of association,
there was throughout the year to 31 December 2024,
and is at the date of this report, a qualifying third-party
indemnity provision, as defined in section 234 of the
Companies Act 2006 in force for the benefit of
the directors.
Report of the Directors continued
The directors present the audited consolidated and parent-Company financial statements of M.P. Evans Group PLC for
the year ended 31 December 2024.
42
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
SIGNIFICANT INTERESTS
As far as the Company is aware, the significant interests
(other than directors’ holdings) in the Company as at the
date of this report are:
Nature
Shares
%
Kuala Lumpur Kepong
Berhad
Direct
12,685,357
24.31
Nokia Bell Pensioenfonds
ofp
Direct
5,416,564
10.38
Schroder Investment
Management
Indirect
2,871,643
5.50
aberdeen
Indirect
2,170,523
4.16
AUTHORITY TO MAKE MARKET PURCHASES
OF SHARES
The directors propose to seek authority under resolution
7 set out in the notice of the annual general meeting
for the Company to purchase its own shares on the AIM
market of the London Stock Exchange until 30 June 2026
or, if earlier, the date of the Company’s 2026 annual
general meeting. The authority will give the directors
flexibility to purchase the Company’s shares as and when
they consider it appropriate. The board will only exercise
the power of purchase when satisfied that it is in the
best interests of the Company and its members so to do,
and all such purchases will be market purchases made
through the AIM market of the London Stock Exchange.
The directors would only consider making purchases if
they believed that the earnings or net assets per share
of the Company would be improved by such purchases.
The normal policy is that the Company’s own shares
purchased by the Company under this authority are
cancelled. However, the directors would consider holding
the purchased shares as treasury shares as this would
give the Company the flexibility of being able to sell such
shares quickly and effectively where it considers it in the
interests of shareholders so to do. Whilst any such shares
are held in treasury, no dividends will be payable on
them, and they will not carry any voting rights.
Resolution 7 will accordingly be proposed, to authorise
the purchase of up to a maximum of 5,217,629 shares,
on the AIM market of the London Stock Exchange,
representing 10% of the Company’s current issued share
capital. The maximum price which may be paid for a
share on any exercise of the authority will be restricted to
5% above the average of the middle-market quotations
for such shares as derived from the Daily Official List of
the London Stock Exchange for the five business days
before the purchase is made. The maximum number of
shares and the price range are stated for the purpose
of compliance with statutory requirements in seeking
this authority and should not be taken as an indication
of the level of purchases, or the prices thereof, that the
Company would intend to make.
The authority conferred by resolution 7 set out in the
notice of the annual general meeting will lapse on 30
June 2026 or, if earlier, the date of the Company’s 2026
annual general meeting.
OUTSTANDING OPTIONS TO SUBSCRIBE
As at the date of this report, there were options to
subscribe for 308,911 shares outstanding under the 2017
long-term incentive scheme. 19,388 shares have already
been issued to the Company’s Employee Benefit Trust in
anticipation of the exercise of these options. The trustees
of the Employee Benefit Trust have waived their voting
rights in relation to the shares held in the trust. If all
of the options were exercised, the resulting number of
shares would represent 0.55% of the enlarged issued
share capital at that date and 0.61% of the enlarged
issued equity share capital at that date if the proposed
authority to purchase shares under resolution 7 was
exercised in full (excluding any share capital which may
be purchased and held in treasury).
FINANCIAL INSTRUMENTS
Details of the Group’s financial instruments, and the
board’s policy with regard to their use, are given in note
31 to the consolidated accounts on pages 90 and 91.
SUBSIDIARY COMPANIES
Details of the Group’s subsidiary companies, including
their country of operation, are given on page 98.
ENERGY USE
During the year, the Company used 62MWh (2023 —
56MWh) of energy, predominantly on electricity and
gas, in its Tunbridge Wells head office, giving rise to 13
tonnes (2023 — 11 tonnes) of CO2 equivalent emissions,
calculated in accordance with the government’s 2024
conversion factors, or 2 tonnes (2023 — 2 tonnes) per
full-time equivalent employee. More information on
Group emissions, and on carbon-reduction plans, is
included in the sustainability section on pages 32 to 34.
43
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
IN RESPECT OF THE FINANCIAL STATEMENTS
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 have prepared the Group financial statements
in accordance with UK-adopted International Accounting
Standards and the Company financial statements in
accordance with United Kingdom Generally Accepted
Accounting Practices (United Kingdom Accounting
Standards, comprising Financial Reporting Standard 101
‘Reduced Disclosure Framework’ (“FRS101”) and applicable
law). Under company law the directors must not approve
the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the
Group and the Company and of the profit or loss of the
Group and Company for that period. In preparing these
financial statements, the directors are required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and accounting estimates that are
reasonable and prudent;
• state whether UK-adopted International Accounting
Standards and applicable United Kingdom accounting
standards, including FRS101, have been followed,
subject to any material departures disclosed and
explained in the Group’s and Company’s financial
statements respectively; and
• prepare the financial statements on the going-concern
basis unless it is inappropriate to presume that the
Company will continue in business.
The directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Group’s and the Company’s transactions and disclose
with reasonable accuracy at any time the financial
position of the Company and the Group and enable them
to ensure that the financial statements and the directors’
remuneration report comply with the Companies Act
2006. They are also responsible for safeguarding the
assets of the Company and the Group, and hence for
taking reasonable steps for the prevention and detection
of fraud and other irregularities.
The directors are responsible for the maintenance
and integrity of the Company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
The directors consider that the annual report and
accounts, taken as a whole, is fair, balanced and
understandable, and provides the information necessary
for shareholders to assess the Company’s performance,
business model and strategy.
GOING CONCERN
The Group’s operations are funded through a
combination of cash resources, loan finance, and long-
term equity. The board has undertaken a recent review of
the Group’s financial position, including forecasts, risks
and sensitivities. The review has considered the Group’s
plans for further development in Indonesia, along with
the required funding for that development. Based on
that review, the board has concluded that the Group is
expected to be able to continue in operational existence
for the foreseeable future, being at least the next 12
months from the date of approval of these financial
statements. As a result, the board has concluded that
the going-concern basis continues to be appropriate in
preparing the financial statements.
DISCLOSURE OF INFORMATION TO AUDITORS
In the case of each director in office at the date the
report of the directors is approved:
• so far as the director is aware, there is no relevant
audit information of which the Group and parent-
Company’s auditors are unaware; and
• they have each taken all the steps that they ought to
have taken as a director in order to make themselves
aware of any relevant audit information and to
establish that the Group and parent-Company’s
auditors are aware of that information.
This confirmation is given and should be interpreted in
accordance with the provisions of section 418(2) of the
Companies Act 2006.
INDEPENDENT AUDITORS
The auditors, BDO LLP, have expressed their willingness to
continue in office and a resolution to re-appoint them will
be proposed at the forthcoming annual general meeting.
Approved by the board of directors and signed by its
order.
Katya Merrick
Company secretary
25 March 2025
Report of the Directors continued
44
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
CORPORATE GOVERNANCE
The Group’s recognised corporate
governance code is the QCA
Corporate Governance Code (“QCA
Code”) as published in 2023. The
board is committed to following the
principles set out in the QCA Code,
to review, disclose and report on the
corporate-governance structures and
processes operated by the Group and
to develop these further, to continue
to meet the appropriate standards.
The board conducts annually a
detailed review of its corporate
governance arrangements against the
ten principles of the QCA Code and
their application guidelines. Following
the latest review, the board concluded
that it complies with each of the ten
principles. An explanation of how the
Group has applied and complies with
the QCA Code’s principles is set out
in this corporate governance report
and in the chairman’s statement on
corporate governance that follows.
An index of corporate governance
disclosures against the 10 principles
of the QCA Code can be found on the
Group’s website*.
Corporate governance
* www.mpevans.co.uk/about/
corporate-governance/index-of-compliance
45
At M.P. Evans, we firmly believe that good corporate
governance underpins the success of the Group. It
supports decision making in the boardroom, mitigates
risk, and fosters a strong Group-wide culture that
engenders trust in the way we operate and conduct
our business. The Group operates in a sector where
timelines are long, and hence where investors are keen
to understand how the board’s governance structures
are protecting the long-term interests of shareholders.
As chairman, one of my primary responsibilities is
to ensure that an effective corporate governance
framework exists. Over the course of the year, the
agenda planning for the board and its committees
ensures that all the areas encompassed by the ten
principles of the QCA Code are reviewed, including
an annual assessment of how we are applying the
principles.
We have clear policies, which have been approved by
the board, and which are promoted and embedded
throughout all levels of the organisation. These policies
reflect the desired ethical culture which the board
considers to be a cornerstone of the Group’s success,
and which aligns with the Group’s purpose of being a
responsible producer of certified sustainable Indonesian
palm oil. These policies are all the more important
given the size and geographical spread of the Group’s
workforce. In addition, the Group sees ethical behaviour
as a competitive advantage to building trust with
customers, suppliers and other key stakeholders, as well
as attracting and retaining high-performing staff.
My other main role is to lead an effective board,
including in its objective of setting the Group’s
strategy. The composition of the board, the breadth
and depth of its skill set, the diversity of its members
to facilitate insight and perspective on matters being
considered, and the inclusive environment within which
constructive debate is enabled, are hugely important
to the effectiveness of the board. Ensuring that we
have the right people in the right roles is something to
which we regularly dedicate time as a whole board, with
succession planning and board evaluation routinely on
the board’s agenda.
During 2024, there was almost 100% attendance at
meetings. The Company calendar normally includes
six board meetings, one of which is online. In 2024,
the board also met in person for a full-day strategy
review, as well as a further unscheduled online meeting.
Members consistently demonstrated high levels of
engagement in all areas of the business, whether
meeting as a board or as remuneration or audit
committees. I am confident that we have a very strong
and fully engaged board which has a good balance of
skills, experience and diversity to support and further
the Group’s strategy, and which promotes the Group’s
culture. More information on our non-executive board
members, including whether they are considered
independent, can be found in the corporate governance
section of the 2024 annual report.
Bruce Tozer, who will have served on the board for nine
years in June, chairing the audit and remuneration
committees since 2022, in addition to his role as senior
independent director, will be retiring at the next AGM. It
will be a challenge to find someone who encompasses
the multiple areas of expertise that make Bruce such a
valued board member. However, since the second half
of 2024, my colleagues and I have been engaged in a
diligent succession-planning process. This has included
mapping out, with a long-term perspective, key skills and
personal attributes that will ensure the board continues
to be effective and evolve to meet future needs.
The board has, for several years, carried out internally
led evaluations of itself and its committees, and board
members welcome these exercises as an opportunity
to reflect and provide constructive feedback. In 2024,
we decided to invite an external facilitator to conduct a
board evaluation. The assessor was asked to focus on
board composition and structure, skills, meetings and
briefings and communications, specifically with a view to
the outcomes feeding into the profile for the upcoming
board appointment. I am pleased to report that the
assessment concluded that the board is effective.
My colleagues and I found the external perspective
very useful and will reflect upon the outcomes,
further details of which are included in the corporate
governance report.
Corporate governance continued
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT
46
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
CORPORATE GOVERNANCE
Board members are encouraged and facilitated to
maintain and build their relevant knowledge and skills.
Access to training is available to ensure knowledge is
up to date and, where necessary, we engage external
specialists to support the board and senior management
in their decision making.
During the latter part of the year, awareness of the
Group’s zero tolerance of bribery and corruption was
refreshed by online training completed by board
members and staff in Indonesia and the UK. This
supplemented ongoing training and socialisation of the
Group’s policies throughout the workforce, led by the
Indonesian human resources team. Similarly, Group-
wide online cyber-security training was carried out
by staff and directors, as part of a mitigation strategy
against cyber risk.
The board, supported by the audit committee, has
continued to make progress on risk identification,
management, mitigation, and disclosure. As well as
reviewing matters reported by the internal audit team,
and monitoring the internal controls over financial
reporting, there is regular dialogue between the Group’s
head of risk in Indonesia and executive directors, to
ensure that mitigation strategies are being developed,
deployed and are effective, and that any newly identified
risks are assessed.
In 2024, the remuneration committee worked on
developing appropriate remuneration packages
for executives and senior management, including
looking at long-term incentivisation and alignment of
remuneration and bonuses to the Group’s strategic
priorities and values. Further details of executive
remuneration are set out in the remuneration report of
the 2024 annual report.
We continue to be committed to our ESG agenda. Our
specialist ESG consultants have again been working
closely with the chief executive and the Group’s
sustainability team during the year, including providing
board-level briefings. They also led a climate-risk
workshop in which the senior managers from across all
the Group’s operational teams participated. We have
also been able to launch two conservation initiatives
which are discussed in more detail in the sustainability
section on pages 35 and 37. Following extensive
planning and expert-led research, a biodiversity project
is now well under way at our Bangka estate, and we are
anticipating positive impacts as the project matures. We
are also conserving a mangrove forest adjacent to our
Bumi Mas estate in East Kalimantan.
At least annually, the board considers who the Group’s
stakeholders are, and how the board engages with
them. This helps to embed into the board’s decision-
making process the practice of considering wider
stakeholder issues. The whistleblower hotline continues
to be effective as a channel for stakeholders to report
potential wrongdoing, and whilst we are pleased that
no serious whistleblower issues have been identified
to date, any grievances reported are treated as an
opportunity to see if improvements need to be made
in the way we do things. An employee-engagement
initiative, led by the Indonesian human resources team,
enables direct feedback to be shared by estate workers.
I have been, as always, delighted to receive positive
feedback from shareholders and other stakeholders
about the quality of our published materials. This
reflects the efforts of the executive team who, in
response to investor expectations, dedicate significant
time to ensuring that high-quality information is readily
available via the Group’s website, including financial and
non-financial reports, videos of our operations, recorded
investor presentations and interviews.
The chief executive and chief financial officer also
conducted an extensive and well-received investor
relations programme during 2024. Whilst I, myself,
transitioned to the role of a non-executive chairman at
the beginning of July 2024, I maintain, and will continue
to maintain, strong relationships with our shareholders
and other stakeholders where appropriate, alongside
Matthew and Luke.
This has been our first year of implementing the
updated QCA Code and we continue to value it, in its
new form, as an appropriate framework within which to
develop and refine our corporate governance practices.
Peter Hadsley-Chaplin
Chairman
25 March 2025
47
Corporate governance continued
OPERATION OF THE BOARD
Directors
Details of the Company’s board, together with those of
the audit and remuneration committees, are set out on
pages 40 and 41. Bruce Tozer will retire from the board
at the annual general meeting, having served for three
consecutive three-year terms.
The board’s structure is designed to ensure that there is
a clear balance of responsibilities between the executive
and the non-executive functions. The maximum number
of directors permitted under the articles of association
is eight.
Time commitment
Executive directors work on a full-time basis. Non-
executive directors, other than the chairman who
makes himself available for at least one day a week, are
expected to contribute two to three days’ service per
month to the Company, including attendance at board
meetings and the AGM. The board meets at least quarterly
and is provided with information at least monthly. It
receives operating summaries, executive operating
reports, management accounts and budgets.
Of the executive directors and non-executive directors
serving throughout the whole year, all attended each
of the eight board meetings held in 2024. In addition,
all committee members attended each of the seven
audit and each of the five remuneration committee
meetings, with the exception of Bruce Tozer who was
excused from the remuneration committee meeting held
on 4 January 2024.
Board composition and attendance of main board and
committee meetings throughout 2024 are shown in the
table below.
Directors’ roles and responsibilities
A description of the roles and responsibilities of the
directors is set out on pages 40 and 41. The board
reserves to itself a range of key decisions (which are
set out on the Group’s website at www.mpevans.co.uk)
to ensure it retains proper direction and control of
the Company, whilst delegating authority to individual
executive directors who are responsible for its day-to-day
management. The board’s objective and the key decisions
reserved to it are subject to periodic review, most recently
in December 2024. The executive and non-executive
directors discuss progress against budgets and other
business issues, both during board meetings and at
other times.
The board is satisfied that its composition covers a broad
range of relevant skills and experience to enable effective
formulation and execution of the Group’s strategy. The
chief executive, Matthew Coulson, is responsible for
implementing the strategy set by the board. He must set
an example of the Group’s culture and ensure that the
Group is complying with its regulatory obligations and
its self-imposed standards. He takes a lead in driving the
Group’s sustainability agenda and investor relations.
Neither of the executive directors holds any external
directorships or offices, and the board is confident that
any external roles held by non-executive directors (for
details see the board biographies on the website www.
mpevans.co.uk) do not compromise their ability properly
to carry out their respective roles for the Company.
Chairman
On 1 July 2024, Peter Hadsley-Chaplin transitioned from
the role of executive chairman to that of non-executive
chairman. Given the time that he has served the Company
both as a director and chairman, as well as the size of
his shareholding in the Company, he is not considered
independent. However, he has a long track record of being
Director
Executive (E)/
Non executive (NED)
Board
Audit
committee
Remuneration
committee
P E Hadsley-Chaplin
E (H1) NED (H2)
8 of 8
M H Coulson
E
8 of 8
L A Shaw
E
8 of 8
B C J Tozer
Independent NED
8 of 8
7 of 7
4 of 5
K Chandra Sekaran
NED
8 of 8
M Sherwin
Independent NED
8 of 8
7 of 7
5 of 5
T Ashton
Independent NED
8 of 8
7 of 7
5 of 5
Lee Y Z
NED
8 of 8
48
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
CORPORATE GOVERNANCE
effective in this role and of building solid relationships
with shareholders, as well as presiding over a well-
functioning board. He maintains a strong individual
relationship with each member of the board.
Senior independent director
The perceived governance concern around having an
executive chairman (as was the case during the first half
of the year), was mitigated by having, in Bruce Tozer, a
robust senior independent non-executive director. The
senior independent non-executive director’s role is to be
a sounding board for the chairman and an intermediary
for other directors. Shareholders and other board
members can, and do, engage with the senior
independent non-executive director to express their
views on specific matters.
Composition of the board and independence of directors
During the year, in compliance with the QCA’s corporate
governance code, the board maintained an appropriate
ratio of executive and non-executive directors.
Throughout the first six months of the year, the board
comprised an executive chairman and two executive
directors (the chief executive and the chief financial
officer) and five non-executive directors, one of whom
chairs the audit and remuneration committees.
For the second half of the year, it comprised two
executive directors and six non-executive directors
following the transition of the chairman from executive
to non-executive director. In further compliance with the
QCA’s corporate governance code, at least three of the
five non-executives serving during the first half of 2024
were independent, and from 1 July 2024, three out of the
six non-executive directors were considered independent.
Throughout 2024, all three members of the audit
and remuneration committees were independent
non-executive directors. Neither K Chandra Sekaran
nor Lee Yuan Zhang is considered to be independent,
K Chandra Sekaran due to his previous role heading the
Indonesian operations and Lee Yuan Zhang due to being
a representative of the Group’s largest shareholder, KLK.
However, the vast sector experience, both operational
and commercial, that they bring to the board, is of great
benefit. Neither of these board members serves on the
audit or remuneration committees.
All board members engage fully and constructively in
board discussions, demonstrating independent mindsets
and a willingness to challenge and hold the executives
to account.
One of the Group’s
high-carbon-stock
conservation areas
at Kota Bangun
49
Board skills and personal attributes
The skills and personal attributes of each of the directors
facilitate rigorous but constructive debate, informed
and considered decision making, as well as the effective
monitoring of progress in achieving the Group’s strategic
objectives and desired culture. Directors are encouraged
to maintain and develop relevant skills, and the Company
will enable them to attend workshops, dedicated
briefings, webinars, conferences and training courses as
appropriate.
Bruce Tozer, whose background is in commodity finance,
environmental markets, and agri-business, including
palm oil, keeps himself well informed of commercial
issues and trends, and he is able to contribute valuable
insight from the finance sector. The board benefits
from K Chandra Sekaran’s profound knowledge of the
Group’s operations, his understanding of the Indonesian
plantation industry and the agronomic and social issues
related to it. The extensive corporate experience of
Michael Sherwin, gained through his years in executive
and non-executive roles, and across a range of areas
including M&A, corporate governance and accounting,
enables him to identify essential issues in board and
committee discussions, particularly around risk and
internal control. Tanya Ashton, recognised professionally
for her commitment to increasing sustainability in
consumer products, has over 20 years of experience
in ESG roles and through her insightful contributions
supports the board’s ESG awareness in discussions.
Lee Yuan Zhang enhances the board in the agronomic
as well as corporate aspects of the business, through
his extensive experience derived from the roles he has
held and continues to hold in KLK and its associated
companies.
Board support
The board, and board committees, have access to
independent professional advice at the Group’s expense
when the board, or board committee, deems it necessary
for it to carry out its responsibilities. The board appointed
Cavendish Capital Markets Limited as the Company’s
nominated adviser. The board additionally receives
advice from independent professionals on legal matters,
corporate public relations, taxation, and valuation of the
Group’s property assets. In 2024, the board again worked
with its appointed specialist ESG consultancy firm to
assist with its disclosure obligations under the non-
financial and sustainability reporting regime, building on
the data reported in its previous annual reports.
The board also engaged an external facilitator to conduct
a board performance review. The company secretary
provides support on matters of corporate governance,
working with the chair to embed regular review by the
board of key Group policies and corporate governance
developments. The company secretary is responsible
for the induction process for new board members,
receives the feedback given by board members when an
internal board evaluation is conducted, and can also be
a point of contact for board members, shareholders and
stakeholders.
Corporate culture
The board is collectively responsible to shareholders
for the success of the Company and understands the
need for robust corporate governance structures and
a Group-wide ethical culture in achieving this. The
board, with input from stakeholders as appropriate,
regularly engages in reviewing and developing policies
which support the Group’s values. It actively promotes
a culture founded on its values of integrity, teamwork
and excellence, and continually monitors the strength
of this culture. Members of the board lead by example
during their frequent interactions with staff, and they
promote the clear policies which are set by the board.
They insist that policies are promulgated throughout the
workforce, including training on key areas such as anti-
bribery and corruption, modern slavery and the Group’s
independently administered whistleblowing hotline.
Remuneration of all staff rewards those who display the
desired behaviours. The Group dismisses staff found
to have breached the value of integrity and in those
circumstances any unexercised awards under the long-
term incentive scheme would be forfeited.
Succession planning
The Company does not currently have a nominations
committee. During the year, as part of its corporate
governance review, which took into account the QCA Code
requirement that boards maintain company-appropriate
governance structures, the board considered whether
it should constitute a separate nominations committee
to support director and senior management succession
planning. As in previous reviews, the board decided that
the significance of succession planning was such that the
whole board should be involved in long-term succession
planning, as well as more immediate board recruitment
needs as they arise. Changes to the board are currently
managed collaboratively, led by the chair.
Corporate governance continued
50
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
Any new appointments are discussed at a full board
meeting, taking into account the board’s own assessment
of the skills and experience required for it successfully to
formulate and execute the Group’s strategy, the current
skills and experience of board members and those of the
candidate, an assessment of board diversity, as well as
feedback from the board evaluation process. Following
a selection process, the Company engages professional
consultants to assist in identifying appropriate and
diverse candidates. Each member of the board is given
the opportunity to meet the shortlisted candidates before
an appointment is made.
It is considered that the board would be resilient to any
unplanned changes and be able to recruit or promote
suitable, well-qualified, candidates within a reasonable
time period. The board has committed to regular reviews
of succession planning and is aware that board diversity,
including gender diversity, is likely to enhance the
board’s range.
Re-election of directors
Each director retires and must seek re-election at least
every three years. Non-executive directors who have
served on the board continuously for a period of nine
years or more will offer themselves for re-election at
each year’s annual general meeting. The board has given
thought to the most recent application guideline of
the QCA Code that recommends giving shareholders an
annual vote on the reappointment of each director. It has
decided that a three-year rotation for voting on directors
at the AGM, as per the Company’s articles, remains
appropriate as this allows directors time to understand
the business, and avoids the destabilising effect of
unplanned board changes. Instead, the board would
encourage shareholders to raise any concerns about
any individual directors with the chairman or senior
independent director.
Shareholder engagement and the AGM
The board attaches great importance to communications
with both institutional and private shareholders. The
chairman and the executive directors regularly engage
with shareholders to update them on the progress of the
Group and discuss any areas of interest that they may
have. Any significant issues raised by major shareholders
are discussed by the board as a whole. The chairman
or members of the board, as appropriate, respond
personally to communications received from individuals
as well as institutional shareholders. The annual general
meeting provides an excellent opportunity for smaller
shareholders to meet executive and non-executive
members of the board in person, to raise any issues and
discuss the development of the business with them. The
Company’s annual general meetings have always been
well attended by its shareholders, but for those who are
unable to attend, the proceedings are broadcast, live,
online and a recording is made available on the Group’s
website (www.mpevans.co.uk) after the event.
During 2024, the executive directors took part in a
number of online presentations, the recordings of
which are available on the Group’s website. These
included two freely accessible live webinars by the
executive directors following the 2023 results and the
2024 interim results, with the opportunity for questions
and feedback from participants. The board intends to
continue to use online forums, including certain social
media channels, as a means of communicating the
Company’s investment case.
The board uses the Group’s website (www.mpevans.co.uk)
to make available details of the AGMs, the results of
the votes cast at those meetings, and reports and
presentations given at meetings with investors.
Board performance evaluation
During the last quarter of 2024, the board engaged an
external assessor to carry out a board performance
evaluation. The process was led by the chairman in
conjunction with the company secretary. Working to
a brief which specified a focus on board composition
and structure, board skills, board meetings, and board
briefings and communications, the assessor spent time
interviewing the eight members of the board, as well as
the Group’s Indonesian President Director, Ravichandran
Krisnapillay, and the company secretary. She also
observed two board meetings, as well as a remuneration
and audit committee meeting.
The assessor gave a presentation of the findings, which
had first been discussed with the chairman and company
secretary, to the board and provided an executive
summary for the board’s further consideration. Whilst the
board was assessed as effective, the evaluation process
raised insights primarily around succession planning, and
how the board and its committees operate together. The
board is in the process of reviewing next steps.
In response to the outcomes of the 2023 evaluation,
during 2024 the board held a dedicated strategy day, also
attended by Ravichandran Krisnapillay. Another topic of
focus, the effectiveness of stakeholder engagement, saw
the executive directors working on the information
REPORT OF THE DIRECTORS
CORPORATE GOVERNANCE
51
Corporate governance continued
published on the Group’s website during the year, and
increasing their investor relations activities. In Indonesia,
a workforce engagement programme has been initiated.
Additional KPIs were also published, in response to
the 2023 board evaluation, and the board continues to
consider new metrics that might be helpful to investors.
Directors’ remuneration
As set out in the report on pages 54 to 57, the
remuneration of the executive directors is determined
by the remuneration committee, whilst that of the non-
executives is determined by the whole board.
ACCOUNTABILITY
Financial reporting
A detailed review of the performance and financial position
of the Group is included in the chairman’s statement and
the strategic report. The board uses these and the report
of the directors to present a balanced and understandable
assessment of the Group’s position and prospects. The
directors’ responsibility for the financial statements is
described on page 44 of the report of the directors.
Risk management
The directors acknowledge their responsibilities for the
Group’s system of risk management. Such a system can
provide reasonable, but not absolute, assurance against
material misstatement or loss. A review of the process of
risk identification, evaluation and management is carried
out by the audit committee. The committee considers
the Group’s principal risks, and a summary is presented
to the board for discussion and approval. The review
process considers the control environment and the major
business risks faced by the Group. In summary, this is
reported on pages 28 to 31.
Important control procedures, in addition to the day-to-
day supervision of parent-Company business, include
regular executive visits to the areas of operation of the
Group and of its associates, comparison of operating
performance and monthly management accounts with
plans and budgets, application of authorisation limits,
internal audit of subsidiary undertakings and frequent
communication with local management. The Group also
has an independently administered whistleblower hotline
service. The regular trips by the executive directors to the
Group’s operations are a valuable way for directors to
monitor the Group’s operations and culture, and they use
these opportunities to promote the Group’s values.
Additional engagement is achieved through virtual
meetings with operational teams, and the executive
directors make the most of technology to enhance
oversight. In October 2025, the non-executive directors
will join the executives on a trip to the Jakarta head office
and to one of the Group’s estates, as part of a two-year
visiting cycle for the board.
Going concern
The board has assessed and concluded on the going-
concern status of the Group, and further information is
included in the directors’ report on page 44.
Viability
The board considers the Group’s longer-term viability on
a regular basis. To do this, both short-term budgets and
longer-term projections are prepared and reviewed by the
board. Due to the long-term nature of the industry within
which the Group operates, the board has concluded that
projections should be prepared, and therefore viability
considered, over a 10-year period.
At the year end, the Group held a cash balance of over
US$79.2 million. Furthermore, as disclosed in note 22, at
the year end, the Group had available undrawn finance
facilities of up to US$30 million. The Group’s plans for
further development of its Indonesian operations have
been taken into consideration, as set out in the strategic
report, including development of existing projects,
investment in new hectarage, and appropriate financing
where necessary.
Principal areas of risk, and their mitigation, are included
in the section on risk management on pages 28 to
31. Financially, the main risk to the Group’s results
is commodity-price fluctuation and, as has been
demonstrated previously, the Group is able to continue
delivering returns even during periods of lower crude-
palm-oil prices.
The Group’s prospects remain sound, given its increasing
planted hectarage and, in particular, the increased milling
capacity achieved in recent years, following a substantial
investment by the Group enabling it to mill almost all
of its own harvest. In light of this, and the resources
available to the Group, the board intends, where possible,
to maintain or increase, normal dividends in future years
from their current levels.
The board has not identified any significant concerns
regarding the Group’s longer-term viability.
52
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
AUDIT COMMITTEE REPORT
The audit committee is formally constituted with written
terms of reference (which are available on the Company’s
website www.mpevans.co.uk) and is chaired by Bruce
Tozer. The other members are Michael Sherwin and Tanya
Ashton. All current members of the committee served
throughout 2024. The directors who are not members of
the committee can be invited to attend its meetings. The
auditors of the Group may also attend part or all of each
meeting and they have direct access to the committee
for independent discussions, without the presence of the
executive directors. The external auditors attended two of
the meetings held in 2024.
The audit committee may examine any matters relating
to the financial affairs of the Group or the Group’s
audit; this includes reviews of the annual accounts and
announcements, accounting policies, compliance with
accounting standards, reviewing the Group’s principal
risks, the appointment of and fees of auditors, and such
other related matters as the board may require.
During the year the audit committee has:
• Reviewed the Group’s external financial reporting,
including receiving a report from the external auditors
on the audit work they have performed;
• Assessed critical accounting judgements and key
estimates made during the year;
• Reviewed findings of the internal audit team and the
work they have performed;
• Reviewed the quality and effectiveness of the external
audit and considered points arising from it;
• Reviewed the Group’s whistleblower policy and
implementation, including assessment of briefings
of reports made to senior management or the
independent hotline;
• Monitored progress of the Group’s risk identification,
management and disclosure;
• Reviewed acquisition accounting in relation to the
newest estates, ABK and Nusantara;
• Reviewed acquisition accounting for the 5% minority
holding in the majority of its Indonesian subsidiary
trading companies, acquired by the Group;
• Engaged with the component auditors.
Auditors
The auditors, BDO LLP, were appointed, following a tender
exercise, in 2019. The audit partner changes at least
every five years in accordance with professional and
regulatory standards in order to protect independence
and objectivity. Nigel Harker was the audit partner for the
2024 audit.
The audit committee meets the external auditors to
consider audit planning and the results of the external
audit. The committee specifically considered the scope
of the Group auditors’ engagement and agreed the
significant risks for the audit of the 2024 results. The
external auditors have provided only audit services during
the current year. Accordingly, the board does not consider
there to be a risk that the provision of non-audit services
may compromise the external auditors’ independence.
To assess the effectiveness of the auditors, the committee
reviews their fulfilment of the agreed audit plan and
variations from it, and the auditors’ report on issues
arising during the course of the audit.
Financial reporting and review of financial statements
The committee is able to ensure it has a full
understanding of business performance through its
receipt of regular financial and operational reporting,
its review of the budget and long-term plan and its
discussion of key accounting policies and judgements. It
has specifically addressed the:
• Existing control environment over internal controls in
financial reporting;
• Group’s equity valuation, as disclosed in the annual
report; and
• Ongoing validity of key judgements in the financial
statements.
After reviewing presentations and reports from
management and discussing with the auditors, the audit
committee is satisfied that the financial statements
properly present the critical judgements and key
estimates for both the amounts reported and relevant
disclosures. The committee is also satisfied that the
significant assumptions used for determining the value of
assets and liabilities have been appropriately scrutinised,
challenged and are sufficiently robust.
REPORT OF THE DIRECTORS
CORPORATE GOVERNANCE
53
Remuneration report
REMUNERATION COMMITTEE
The remuneration committee, which is formally constituted
with written terms of reference (available on the
Company’s website at www.mpevans.co.uk), keeps under
review the remuneration and terms of employment of the
executive directors and the most senior management,
and recommends such remuneration and terms to the
board. The committee comprises Bruce Tozer (chair of the
remuneration committee), Michael Sherwin and Tanya
Ashton, all of whom served throughout 2024.
SERVICE CONTRACTS
All of the UK executive directors have service contracts with
the Company. These contracts continue until terminated
by either party giving not less than one year’s notice in
writing. The non-executive directors serve under letters
of engagement which do not include provisions for
pre-determined compensation on termination of their
appointment. During the year, K Chandra Sekaran had a
service contract with a subsidiary company with a notice
period of less than one year.
REMUNERATION POLICY
The Group’s remuneration committee recognises that the
Group’s success depends, in part, on the performance
of the directors and senior management, and the
importance of ensuring that employees are incentivised.
Its philosophy is to offer a transparent and simple
remuneration package to the executive directors. To
deliver this, the structure for remuneration:
• is designed to be easily understood by both executives
and shareholders.
• aims to encourage the executive directors to work
collegiately, focus their efforts on making decisions
that are in the Group’s best long-term interests, and,
to some extent, share in the benefits that accrue to
shareholders from a higher future share price.
For several years, this has been delivered by
remuneration packages comprising a salary and a bonus
related to current results and personal performance. For
the UK executive directors, half of the bonus is payable
in cash and half is deferred into an award of options on
fully paid shares which vest three years after their grant,
subject to continued employment by the Group.
In addition to the options awarded as part of the deferred
element of their bonus, the UK executives receive a share
award made under the long-term incentive scheme (see
below) designed further to align their remuneration
package with the long-term interests of shareholders.
This annual share award helps to maintain the Group’s
outlook of offering remuneration packages which are
designed to be broadly comparable with those offered
by similar businesses, such as European plantations and
AIM-listed companies.
Key aspects of the UK executive directors’ long term
incentive awards, and the rationale for those awards are
summarised below:
• The type of award made could be classified as a
‘restricted-stock’ award, where vesting is dependent
on continued employment at the end of a three-year
vesting period from the date of award.
• Importantly for M.P. Evans, this form of award was
already used for the Group’s Indonesia-based former
executive and senior management there and there is
a strong benefit in consistency of approach across the
UK and Indonesian teams (see the section “Long-term
incentive scheme” below).
• The award is straightforward and aligns to the Group’s
business outlook. The remuneration committee
considered and discounted introducing a Performance
Share Plan, where the vesting of awards would be
dependent on attaining three-year Group performance
conditions. In a very long-term business like that of
M.P. Evans, three-year cycles would not necessarily
reflect the Group’s investment and development
profile, and vesting could be heavily influenced by
macro-factors such as commodity prices.
• The vesting of the share awards made to the UK
executives is, however, subject to the remuneration
committee being satisfied regarding the attainment
of ‘underpin’ performance conditions in the period
to vesting which will consider the general financial
performance of the Group and adherence to the
Group’s core strategic pillars of Responsibility,
Excellence, Growth, and Yield.
• At the date of the initial award to the chief executive
on 16 January 2023, the 18,000 shares subject to the
awards made were equal in value to approximately
45% of the chief executive’s 2022 base salary. Since
then, for simplicity and for consistency with how award
levels are set for colleagues in Indonesia, the UK
executives’ annual award levels have been maintained
at 18,000 and 12,000 shares for the chief executive and
chief financial officer respectively, although this will be
reviewed for continuing appropriateness before each
award is made.
54
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
REMUNERATION REPORT
TOTAL DIRECTORS’ REMUNERATION FOR THE YEAR ENDED 31 DECEMBER 2024
Salary
and fees
£
Bonus
paid
£
1Bonus
deferred
£
Other
benefits
£
Salary
in lieu of
pension
£
2 Pension
costs
£
3 Gain on
exercise
of share
options
£
Total
remuneration
2024
£
Total
remuneration
2023
£
Executive directors
P E Hadsley-Chaplin4
73,650
36,825
—
9,355
—
—
—
119,830
368,391
M H Coulson
368,150
184,075
184,075
39,875
31,651
10,000
81,196
899,022
796,742
L A Shaw5
246,750
123,375
123,375
15,636
6,776
23,133
—
539,045
199,396
K Chandra Sekaran
—
—
—
—
—
—
—
—
716,235
688,550
344,275
307,450
64,866
38,427
33,133
81,196
1,557,897
2,080,764
Non-executive directors
P E Hadsley-Chaplin4
50,000
—
—
1,510
—
—
—
51,510
—
P A Fletcher
—
—
—
—
—
—
—
—
23,100
B C Tozer
48,615
—
—
—
—
—
—
48,615
46,300
K Chandra Sekaran6
344,820
176,194
—
—
—
—
132,000
653,014
146,488
M Sherwin
41,580
—
—
—
—
—
—
41,580
39,600
T Ashton
41,580
—
—
—
—
—
—
41,580
39,600
Lee Y Z
41,580
—
—
—
—
—
—
41,580
36,300
568,175
176,194
—
1,510
—
—
132,000
877,879
331,388
Total
1,256,725
520,469
307,450
66,376
38,427
33,133
213,196
2,435,776
2,412,152
1. In line with the Group remuneration policy for the UK executives, half of the bonus for the year to Mr M H Coulson and Mr L A Shaw
(being in each case 12 months’ salary) has been deferred into an award of options over fully paid shares of equal value which vest
after three years subject to continued employment by the Group.
2. The pension costs for Mr M H Coulson are the contributions made by the Company to a Company-sponsored self-invested personal
pension whilst those for Mr L A Shaw are the contributions made by the Company to the Company’s defined contribution pension
scheme.
3. The gain on share options for Mr M H Coulson includes amounts already reported in previous years as remuneration under “Bonus
deferred”. That for K Chandra Sekaran represents the gain on exercise of 20,000 shares granted under the 2012 executive share
option scheme and on exercise of 3,000 under the 2017 long-term Incentive Scheme.
4. The remuneration for Mr P E Hadsley-Chaplin in 2024 is shown in the executive director remuneration section of the table for the
period in which he was an executive director, and in the non-executive director section of the table for the remainder of the year.
5. Mr L A Shaw was appointed to the board on 1 August 2023, and this is reflected in his total remuneration for 2023.
6. K Chandra Sekaran received a fee as a non-executive director in 2024. In addition, he received an advisory fee from the Group’s
Indonesian subsidiary, PT Evans Indonesia. The bonus paid in 2024 relates to the period he served as an executive director.
The annual ratio for total remuneration of the chief executive in relation to the median of the Group’s UK payroll
excluding this individual was 6.0 (2023 — 5.9). The equivalent ratio for the percentage increase in annual total
remuneration was 1.3 (2023 — 0.5).
• The awards to the UK executives also contain features
which we believe will make the awards genuinely
long-term:
— After the three-year vesting period, vested shares
(after any sales for UK income taxes and National
Insurance) must be retained by the UK executives
for a further two years.
— Beyond that period, the UK executives are encouraged
to hold shares and build their personal shareholding.
LONG-TERM INCENTIVE SCHEME
The long-term incentive scheme established in 2017
governs the grant of deferred-bonus awards to UK-based
executive directors and annual awards of fully paid
shares to senior staff, as well as the annual awards, since
2023, made to the UK-based executives.
The award of fully paid shares has the advantage of
being substantially less dilutive than market-priced share
options, whilst continuing to provide a suitable level of
incentive to the recipient.
55
Remuneration report continued
No additional performance criteria attach to the deferred-
bonus awards since the original bonus will have been
performance related.
In respect of senior staff who are not UK-based executive
directors, the Group aims annually to grant options in a
limited number of fully paid shares which vest after three
years subject to continued employment by the Group.
This is designed to retain valued individuals in a growing
and competitive sector. No performance criteria attach to
these awards.
EXECUTIVE DIRECTORS
When determining the remuneration of the executive
directors, the remuneration committee considers the pay
and conditions across the Group, particularly those of
the senior management of the operations in Indonesia.
The Group aims to provide remuneration packages for the
directors and senior management which are a fair reward
for their contribution to the business, having regard
to the complexity of the Group’s operations and the
need to attract, retain and motivate high-quality senior
management.
OPTIONS HELD OVER SHARES OF THE COMPANY BY DIRECTORS
DURING THE YEAR ENDED 31 DECEMBER 2024
Balance
at 1 Jan
2024
Granted
in the
year
Exercised
in the
year
Balance
at 31 Dec
2024
Exercise
price
pence
Date
granted
Date from
which
normally
exercisable
Expiry
date
Executive share-option scheme
K Chandra Sekaran
20,000
—
20,000
—
412.50
27 Apr 15
27 Apr 18
27 Apr 25
Total
20,000
—
20,000
—
—
—
—
—
Long-term incentive scheme
M H Coulson
10,049
—
10,049
—
0.00
22 Dec 20
22 Dec 23
21 Dec 30
13,748
—
—
13,748
0.00
14 Dec 21
14 Dec 24
13 Dec 31
19,880
—
—
19,880
0.00
13 Dec 22
13 Dec 25
12 Dec 32
18,000
—
—
*18,000
0.00
16 Jan 23
16 Jan 26
15 Jan 33
22,256
—
—
22,256
0.00
12 Dec 23
12 Dec 26
11 Dec 33
—
18,000
—
*18,000
0.00
4 Jan 24
4 Jan 27
3 Jan 34
—
19,376
—
19,376
0.00
18 Dec 24
18 Dec 27
17 Dec 34
83,933
37,376
10,049
111,260
K Chandra Sekaran
3,000
—
3,000
—
0.00
1 Jul 21
1 Jul 24
30 Jun 31
3,000
—
—
3,000
0.00
23 Mar 22
7 Jan 25
6 Jul 25
3,000
—
—
3,000
0.00
1 Jul 22
1 Jul 25
31 Dec 25
3,000
—
—
3,000
0.00
6 Jan 23
6 Jan 26
5 Jul 26
3,000
—
—
3,000
0.00
1 Jul 23
1 Jul 26
31 Dec 26
15,000
—
3,000
12,000
L A Shaw
6,215
—
—
6,215
0.00
12 Dec 23
12 Dec 26
11 Dec 33
—
12,000
—
*12,000
0.00
4 Jan 24
4 Jan 27
3 Jan 34
—
12,986
—
12,986
0.00
18 Dec 24
18 Dec 27
17 Dec 34
6,215
24,986
—
31,201
Total
125,148
62,362
33,049
154,461
* Relate to the UK executive long-term incentive award discussed on pages 54 and 55.
56
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
REPORT OF THE DIRECTORS
REMUNERATION REPORT
BONUS
Non-pensionable bonuses may be awarded annually in
arrears at the discretion of the committee, taking account
of the Group’s performance during the period and other
targeted objectives. Bonuses do not exceed twelve
months’ salary, half payable in cash and half deferred
into an award of fully paid shares which vest three years
after their grant, subject to continued employment by
the Group (as described above). The bonuses for 2024
took into account, inter alia, the Group’s performance in
relation to EBITDA, profit for the year and palm-product
production. The key performance indicators referred to in
the 2023 annual report were also considered in general
terms and the remuneration committee also noted the
efforts made during the year, by each of the UK executives
in progressing agreed areas of focus.
SHARE-OPTION ARRANGEMENTS
During 2024, K Chandra Sekaran was a member of the
executive share-option scheme which was established in
2012. Options granted under this scheme gave K Chandra
Sekaran the right to purchase shares on a future date
at the market price of the shares on the date that the
options were granted. As such, the value of any option is
closely tied to the performance of the Group as reflected
in its share price. There will be no gain on exercise
unless the share price on the exercise date exceeds
the share price on the date the options were granted.
On 31 December 2024, options over nil shares (2023 —
20,000) granted to K Chandra Sekaran under this scheme
remained outstanding. During the year, 20,000 options
were exercised by him (2023 - none) and none (2023 -
none) lapsed.
During the year, Matthew Coulson was a member of
the long-term incentive scheme established in 2017
described above, under which half of any discretionary
bonus is deferred into options over fully paid shares.
Under this arrangement options on 19,376 fully-
paid shares were awarded in 2024 (2023 — 22,256),
representing half of the bonus awarded to him.
During the year, Luke Shaw was also a member of
the long-term incentive scheme established in 2017
described above, under which half of any discretionary
bonus is deferred into options over fully paid shares.
Under this arrangement options on 12,986 fully paid
shares were awarded in 2024 (2023 — 6,215).
The executive directors also received fully-paid share
awards under the UK executive long-term incentive
scheme referred to on pages 54 and 55.
No options are held by either the chairman or non-
executive directors, other than K Chandra Sekaran, who
was awarded options as part of his executive service.
At 31 December 2024, the middle-market quotation for
the Company’s shares, as derived from the London Stock
Exchange Daily Official List, was 994p, as compared with
the high and low quotations for the year of 996p and
722p respectively.
PENSIONS
The Company sponsors self-invested personal pensions
(“SIPPs”) for the UK executive directors. Contributions
made by the Company to the SIPPs and to a life-
assurance company give the executives a pension at
retirement, a pension to a spouse payable on death
whilst in the employment of the Company, and life-
assurance cover based on a multiple of salary. No
element of a director’s remuneration package, other than
basic salary, is pensionable. Individuals may elect to forgo
contributions to the SIPP, in which case they receive an
additional salary paid in lieu of the employer’s pension
contributions at the same cost to the Company.
NON-EXECUTIVE DIRECTORS
The fees of the non-executive directors are determined by
the board having regard to the complexity of the Group’s
operations and the need to attract, retain and motivate
high-quality non-executive directors and the level of fees
paid for similar roles in equivalent companies.
Approved by the board of directors and signed by its
order.
Katya Merrick
Company secretary
25 March 2025
57
OPINION ON THE 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 2024 and of the Group’s
profit for the year then ended;
•
the Group financial statements have been properly
prepared in accordance with UK adopted international
accounting standards;
•
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.
We have audited the financial statements of M.P. Evans
Group Plc (the ‘parent Company’) and its subsidiaries
(the ‘Group’) for the year ended 31 December 2024
which comprise the consolidated income statement,
consolidated statement of comprehensive income,
consolidated and parent-Company balance sheets,
consolidated and parent-Company statements of changes
in equity, consolidated cash-flow statement and notes to
consolidated and parent-Company financial statements,
including a summary of material accounting policy
information.
The financial reporting framework that has been applied
in the preparation of the Group financial statements is
applicable law and UK adopted international accounting
standards. The financial reporting framework that has
been applied in the preparation of the parent-Company
financial statements is applicable law and United
Kingdom Accounting Standards, including Financial
Reporting Standard 101 Reduced Disclosure Framework
(United Kingdom Generally Accepted Accounting Practice).
BASIS FOR OPINION
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit of
the financial statements section of our report. We believe
that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Independence
We remain independent of the Group and the parent
Company in accordance with the ethical requirements
that are relevant to our audit of the financial statements
in the UK, including the FRC’s Ethical Standard as applied
to listed entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
CONCLUSIONS RELATING TO GOING CONCERN
In auditing the financial statements, we have concluded
that the directors’ use of the going concern basis of
accounting in the preparation of the financial statements
is appropriate. Our evaluation of the directors’ assessment
of the Group and the parent Company’s ability to continue
to adopt the going concern basis of accounting included:
•
A review of the directors’ assessment of going concern
and consideration of the key assumptions used in the
forecasts, including:
— Comparing the CPO price used to historical data and
price forecasts.
— Considering forecast production by comparing to
historical results together with taking into account
the age of planted areas in each estate.
•
Consideration of the directors’ sensitivity analysis
together with performing further sensitivities on the
revenue and gross profit margin assumptions.
•
An assessment of the appropriateness and accuracy of
cash-flow forecasts by comparing prior year forecasts
to current year results.
•
A review of whether the disclosures are appropriate for
the circumstances of the entity and provide sufficient
information about the Group and its subsidiaries and
the directors’ consideration of their ability to continue
as a going concern.
Based on the work we have performed, we have not
identified any material uncertainties relating to events
or conditions that, individually or collectively, may cast
significant doubt on the Group and the parent Company’s
ability to continue as a going concern for a period of at
least twelve months from when the financial statements
are authorised for issue.
Our responsibilities and the responsibilities of the
directors with respect to going concern are described in
the relevant sections of this report.
OVERVIEW
Key audit matters
Revenue recognition
2024
2023
Revenue recognition (inappropriate
journal postings to revenue)*
2024
2023
*In the prior year, our KAM focused on revenue recognition due to
fraudulent manipulation of the tender prices. This year, we refined our
group risk assessment at the planning stage, leading to a change in
the key audit matter.
Materiality
Group financial statements as a whole
US$5.66m (2023: US$3.63m) based on 5% (2023: 5%) of
profit before tax.
Independent auditors’ report
To the members of M.P. Evans Group PLC
58
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
INDEPENDENT AUDITORS’ REPORT
AN OVERVIEW OF THE SCOPE OF OUR AUDIT
Our Group audit was scoped by obtaining an
understanding of the Group and its environment,
the applicable financial reporting framework and the
Group’s system of internal control. On the basis of
this, we identified and assessed the risks of material
misstatement of the Group financial statements including
with respect to the consolidation process. We then
applied professional judgement to focus our audit
procedures on the areas that posed the greatest risks to
the Group financial statements. We continually assessed
risks throughout our audit, revising the risks where
necessary, with the aim of reducing the Group risk of
material misstatement to an acceptable level, in order to
provide a basis for our opinion.
Components in scope
We determined components at the legal entity level
having considered the financial reporting process, the
Group’s activities and business lines and commonality of
the control environment across the group, this resulted in
a total of 21 components being identified.
Where we identified the Group risk of material
misstatement to be attributable to a component
we scoped in that component to perform further
audit procedures to address a Group risk of material
misstatement. To determine the level that each
component was scoped in for further audit procedures
we considered the component’s contribution to financial
statement areas of the Group’s financial information
associated with group risks of material misstatement.
For components in scope, we used a combination of risk
assessment procedures and further audit procedures
to obtain sufficient appropriate evidence. These further
audit procedures included:
•
procedures on the entire financial information of
the component, including performing substantive
procedures and tests of operating effectiveness of
controls.
•
procedures on one or more classes of transactions,
account balances or disclosures.
•
specific audit procedures.
Procedures performed at the component level
For the purpose of our Group audit, the group consisted
of 21 components in total. These were comprised of 21
legal entities.
Procedures were performed on the entire financial
information of 5 components, procedures were performed
on one or more classes of transactions, account balances
or disclosures of 8 components and specified procedures
were performed at 2 components.
Disaggregation
The financial information relating to Group risks of
material misstatement is highly disaggregated across the
Group. We performed procedures at the component level
in relation to these risks in order to obtain comfort over
the residual population of group balances.
Working with other auditors
As Group auditor, we determined the components at
which audit work was to be performed, together with the
resources needed to perform this work. These resources
included component auditors, who formed part of the
Group engagement team as reported above. As Group
auditor we are solely responsible for expressing an
opinion on the financial statements.
In working with these component auditors, we held
discussions with component audit teams on the
significant areas of the Group audit relevant to the
components based on our assessment of the Group risks
of material misstatement. We issued our Group audit
instructions to component auditors on the nature and
extent of their participation and role in the Group audit,
and on the Group risks of material misstatement.
We directed, supervised and reviewed the component
auditors’ work. This included a planning visit to
meet with the component auditor, on-site review of
component auditor documentation and evaluating the
appropriateness of the audit procedures performed and
the results thereof.
Climate change
Our work on the assessment of potential impacts of
climate-related risks on the Group’s operations and
financial statements included:
•
Enquiries and challenge of management to understand
the actions they have taken to identify climate-related
risks and their potential impacts on the financial
statements and adequately disclose climate-related
risks within the annual report;
•
Our own qualitative risk assessment taking into
consideration the sector in which the Group operates
and how climate change affects this particular sector;
•
Review of the minutes of board and audit committee
meetings related to climate change and performed a
risk assessment as to how the impact of the Group’s
commitment as set out in the sustainability section in
the report may affect the financial statements and our
audit.
We challenged the extent to which climate-related
considerations, including the expected cash flows from
the initiatives and commitments have been reflected,
where appropriate, in the directors’ going concern
assessment.
59
independent auditors’ report continued
We also assessed the consistency of management’s disclosures included as other Information the financial statements
and with our knowledge obtained from the audit.
Based on our risk assessment procedures, we did not identify any key audit matters materially impacted by climate-
related risks and related commitments.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) that we identified, including those which had the greatest effect on: the overall audit
strategy, the allocation of resources in the audit, and directing the efforts of the engagement team. These matters were
addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters.
KEY AUDIT MATTER
Revenue recognition (inappropriate journal postings to revenue)
Refer to the accounting policies of the Group on page 70 for further detail together with note 4a.
The Group generates revenue predominantly from the sale of crude palm oil (‘CPO’) and palm kernels (‘PK’) from
processed fresh fruit bunches (‘ffb’).
CPO and PK contracts require either full advance payment or an initial advance payment with the rest paid after all
goods are delivered as per the contract.
On receipt of payment in advance from the customer, the revenue transaction is recorded in deferred income which
is then released once goods are delivered.
Journal postings to revenue are expected as part of the revenue recognition process and therefore the existence
of adjustments to revenue accounts would not immediately be considered unusual and as a result could create an
opportunity for management to manipulate revenue through these entries.
For this reason, we considered revenue recognition (inappropriate journal postings to revenue) to be a key audit
matter.
How the scope of our audit addressed the key audit matter
We performed the procedures below:
•
Obtained an understanding of the transaction process for CPO and PK revenue streams by observing transactions
from initial tender to cash receipt and recognition of the transaction in the general ledger. This included
understanding the design and implementation of controls over the processing of revenue.
•
Identified the journal characteristics which, in our judgement, would be considered unusual or potentially
indicative of fraud.
•
For all journals identified under these characteristics, we tested their appropriateness by checking if the
journals had appropriate supporting documentation, were correctly recorded, had valid business reasons, were
reasonable for the operation of the business and were properly authorised.
Key observations:
Based on our procedures performed, we did not identify any indicator to suggest that journals posted by management
were not appropriate.
60
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
INDEPENDENT AUDITORS’ REPORT
OUR APPLICATION OF MATERIALITY
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
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 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
misstatements, and the particular circumstances of their occurrence, when evaluating their effect on the financial
statements as a whole.
Based on our professional judgement, we determined materiality for the financial statements as a whole and
performance materiality as follows:
Group financial statements
Parent-Company financial statements
2024
2023
2024
2023
Materiality
US$5.66 million
US$3.6 million
US$2.2 million
US$2.1 million
Basis for determining
materiality
5% of profit
before tax
5% of profit
before tax
2% of total
assets
2% of total
assets
Rationale for benchmark
applied
We consider profit to be a key performance
measure to a user for the purpose of
evaluating financial performance.
Calculated as 2% of total assets restricted
to 95% percent of Group materiality (if
lower) for Group reporting purposes given
the assessment of aggregation risk.
Performance materiality
US$3.96 million
US$2.5 million
US$1.6 million
US$1.5 million
Basis for determining
performance materiality
70% of
materiality
70% of
materiality
70% of
materiality
70% of
materiality
Rationale for the percentage
applied for performance
materiality
70% of materiality based on our experience and knowledge of the Group and parent
Company, Group structure, planned testing approach, and history of errors.
Component performance materiality
For the purposes of our Group audit opinion, we set
performance materiality for each component of the
Group, apart from the parent Company whose materiality
and performance materiality are set out above, based
on a percentage of between 76% and 12% of Group
performance materiality (2023: 60% and 40% of Group
materiality), dependent on a number of factors including:
•
Expectations about the nature, frequency, and
magnitude of misstatements in the component
financial information.
•
Extent of disaggregation of the financial information
across components.
•
Relative size of components.
•
Significant changes affecting the component since
prior year and our assessment of the risk of material
misstatement of those components. Component
performance materiality ranged from $1.43m to $0.48m
(2023: $2.15m to $1.45m).
Reporting threshold
We agreed with the audit committee that we would
report to them all individual audit differences in excess
of $283,000 (2023: $72,600). We also agreed to report
differences below this threshold that, in our view,
warranted reporting on qualitative grounds.
OTHER INFORMATION
The directors are responsible for the other information.
The other information comprises the information
included in the document entitled ‘annual report’ other
than the financial statements and our auditor’s report
thereon. Our opinion on the financial statements does
not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do
not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and,
in doing so, consider whether the other information is
materially inconsistent with the financial statements
or our knowledge obtained in the course of the audit,
or otherwise appears to be materially misstated. If
we identify such material inconsistencies or apparent
material misstatements, we are required to determine
whether this gives rise to a material misstatement in the
financial statements themselves. If, based on the work
we have performed, we conclude that there is a material
misstatement of this other information, we are required
to report that fact.
We have nothing to report in this regard.
61
independent auditors’ report continued
OTHER COMPANIES ACT 2006 REPORTING
Based on the responsibilities described below and our work performed during the course of the audit, we are required
by the Companies Act 2006 and ISAs (UK) to report on certain opinions and matters as described below:
Strategic report
and directors’
report
In our opinion, based on the work undertaken in the course of the audit:
•
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; and
•
the strategic report and the directors’ report have been prepared in accordance with
applicable legal requirements.
In the light of the knowledge and understanding of the Group and parent Company and its
environment obtained in the course of the audit, we have not identified material misstatements
in the strategic report or the directors’ report.
Matters on which
we are required
to report by
exception
We have nothing to report in respect of the following matters in relation to which 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 are not in agreement with the accounting records
and returns; or
•
certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
RESPONSIBILITIES OF DIRECTORS
As explained more fully in the report of the directors,
the directors are responsible for the preparation of the
financial statements and for being satisfied that they
give a true and fair view, and for such internal control
as the directors determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are
responsible for assessing the Group’s and the parent
Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless
the directors either intend to liquidate the Group or
the parent Company or to cease operations, or have no
realistic alternative but to do so.
AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF
THE FINANCIAL STATEMENTS
Our objectives are to obtain reasonable assurance about
whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance
with ISAs (UK) will always detect a material misstatement
when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in
the aggregate, they could reasonably be expected to
influence the economic decisions of users taken on the
basis of these financial statements.
Extent to which the audit was capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect
of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities,
including fraud is detailed below:
Non-compliance with laws and regulations
Based on:
•
Our understanding of the Group and the industry in
which it operates;
•
Discussion with management and those charged with
governance and component auditors; and
•
Obtaining an understanding of the Group’s policies
and procedures regarding compliance with laws and
regulations.
We considered the significant laws and regulations to be
the applicable accounting framework, UK company law,
UK tax legislation, AIM Rules and the component auditors
considered compliance with Indonesian tax law, the
Indonesian Sustainable Palm Oil (ISPO) regulations and
Indonesian land laws.
62
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
INDEPENDENT AUDITORS’ REPORT
The Group is also subject to laws and regulations
where the consequence of non-compliance could have
a material effect on the amount or disclosures in the
financial statements, for example through the imposition
of fines or litigation. We identified such laws and
regulations to be anti-bribery legislation, the health and
safety legislation and local Indonesian labour laws.
Our procedures in respect of the above included:
•
Review of correspondence with regulatory and tax
authorities for any instances of non-compliance with
laws and regulations;
•
Involvement of tax specialists in the audit;
•
Review of legal expenditure accounts to understand
the nature of expenditure incurred;
•
Reviewing the financial statement disclosures and
agreeing to underlying supporting documentation
where necessary.
•
Review of internal audit reports throughout the year
and subsequent to the year-end and review of minutes
of all board and committee meetings held during and
subsequent to the year for any indicators of non-
compliance and making enquiries of management and
of the directors as to the risks of non-compliance and
any instances thereof.
Fraud
We assessed the susceptibility of the financial statements
to material misstatement, including fraud. Our risk
assessment procedures included:
•
Enquiry with management and those charged with
governance including the audit committee, regarding
any known or suspected instances of fraud;
•
Obtaining an understanding of the Group’s policies
and procedures relating to:
— Detecting and responding to the risks of fraud; and
— Internal controls established to mitigate risks
related to fraud.
Review of minutes of meetings of those charged with
governance for any known or suspected instances of
fraud;
•
Discussion amongst the engagement team as to
how and where fraud might occur in the financial
statements;
•
Performing analytical procedures to identify any
unusual or unexpected relationships that may indicate
risks of material misstatement due to fraud;
•
Considering remuneration incentive schemes and
performance targets and the related financial
statement areas impacted by these.
Based on our risk assessment, we considered the
areas most susceptible to fraud to be unusual account
combinations in revenue journals, post-closing and
accounts preparation journals and journals with
connected parties:
Our procedures in respect of the above included:
•
Testing a sample of journal entries throughout the
year, which met a defined risk criteria, by agreeing to
supporting documentation;
•
Assessing significant estimates made by management.
We also communicated relevant identified laws and
regulations and potential fraud risks to all engagement
team members including component auditors who
were all deemed to have appropriate competence and
capabilities and remained alert to any indications of
fraud or non-compliance with laws and regulations
throughout the audit. For component auditors, we also
reviewed the result of their work performed in this regard.
Our audit procedures were designed to respond to risks
of material misstatement in the financial statements,
recognising that the risk of not detecting a material
misstatement due to fraud is higher than the risk of
not detecting one resulting from error, as fraud may
involve deliberate concealment by, for example, forgery,
misrepresentations or through collusion. There are
inherent limitations in the audit procedures performed
and the further removed non-compliance with laws and
regulations is from the events and transactions reflected
in the financial statements, the less likely we are to
become aware of it.
A further description of our responsibilities is available
on the Financial Reporting Council’s website at: www.frc.
org.uk/auditorsresponsibilities. This description forms
part of our auditor’s report.
USE OF OUR REPORT
This report is made solely to the parent 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 parent
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 parent Company and the parent Company’s members
as a body, for our audit work, for this report, or for the
opinions we have formed.
Nigel Harker (Senior Statutory Auditor)
for and on behalf of BDO LLP, Statutory Auditor
Gatwick, United Kingdom
25 March 2025
BDO LLP is a limited liability partnership registered in
England and Wales (with registered number OC305127)
63
Note
2024
US$’000
2023
US$’000
Continuing operations
Revenue
4
352,839
307,368
Cost of sales
(236,249)
(228,915)
Gross profit
116,590
78,453
Gain on biological assets
1,847
551
Foreign-exchange loss
(23)
(1,188)
Other administrative expenses
(5,930)
(5,443)
Other income
3,211
2,923
Operating profit
115,695
75,296
Finance income
6
1,236
1,348
Finance costs
7
(3,441)
(3,810)
Profit before tax
8
113,490
72,834
Tax on profit on ordinary activities
9
(25,213)
(18,826)
Profit after tax
88,277
54,008
Share of associated companies’ profit after tax
15
2,355
2,390
Profit for the year
90,632
56,398
Attributable to:
Owners of M.P. Evans Group PLC
87,851
52,487
Non-controlling interests
28
2,781
3,911
90,632
56,398
US Cents
US Cents
Continuing operations
Basic earnings per 10p share
11
165.9
97.6
Diluted earnings per 10p share
11
165.1
97.2
Pence
Pence
Basic earnings per 10p share
Continuing operations
129.6
78.1
Consolidated income statement
For the year ended 31 December 2024
64
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
2024
US$’000
2023
US$’000
Profit for the year
90,632
56,398
Other comprehensive income/(expense) (net of tax)
Items that may be reclassified to the income statement
Exchange gain/(loss) on translation of foreign operations
155
(457)
Exchange gain/(loss) on translation of associates
339
(483)
Items that will not be reclassified to the income statement
Remeasurement of retirement-benefit obligations
684
(366)
Other comprehensive income/(expense) for the year
1,178
(1,306)
Total comprehensive income
91,810
55,092
Attributable to:
Owners of M.P. Evans Group PLC
89,020
51,203
Non-controlling interests
2,790
3,889
91,810
55,092
Consolidated statement of comprehensive income
For the year ended 31 December 2024
FINANCIAL STATEMENTS
65
Note
2024
US$’000
2023
US$’000
Non-current assets
Goodwill
13
17,083
17,083
Other intangible assets
13
852
1,012
Property, plant and equipment
14
480,983
486,915
Investments in associates
15
10,524
10,003
Investments
16
61
59
Deferred-tax asset
23
1,808
1,138
Trade and other receivables
19
—
8,875
511,311
525,085
Current assets
Biological assets
17
5,635
3,788
Inventories
18
22,788
24,155
Trade and other receivables
19
20,847
23,853
Current-tax asset
7,777
8,673
Current-asset investments
20
214
270
Cash and cash equivalents
20
79,223
39,324
136,484
100,063
Total assets
647,795
625,148
Current liabilities
Borrowings
22
12,953
21,009
Trade and other payables
21
33,122
27,547
Current-tax liability
13,029
6,279
59,104
54,835
Net current assets
77,380
45,228
Non-current liabilities
Borrowings
22
20,074
33,413
Deferred-tax liability
23
22,007
19,398
Retirement-benefit obligations
24
13,141
12,429
55,222
65,240
Total liabilities
114,326
120,075
Net assets
533,469
505,073
Equity
Share capital
25
8,922
9,062
Other reserves
27
53,887
53,263
Retained earnings
27
462,938
422,748
Equity attributable to the owners of M.P. Evans Group PLC
525,747
485,073
Non-controlling interests
28
7,722
20,000
Total equity
533,469
505,073
The financial statements on pages 64 to 91 were approved by the board of directors on 25 March 2025 and signed on its
behalf by
Peter Hadsley-Chaplin
Matthew Coulson
Chairman
Chief executive
Consolidated balance sheet
Company number: 1555042
As at 31 December 2024
66
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
Note
Share
capital
US$’000
Other
reserves
US$’000
Retained
earnings
US$’000
Total
US$’000
Non-
controlling
interests
US$’000
Total
equity
US$’000
Profit for the year
—
2,355
85,496
87,851
2,781
90,632
Other comprehensive
income for the year
—
236
933
1,169
9
1,178
Total comprehensive income
for the year
—
2,591
86,429
89,020
2,790
91,810
Issue of share capital
25
9
98
—
107
—
107
Dividends paid
10
—
—
(32,339)
(32,339)
(4,450)
(36,789)
Dividends from associates
15
—
(2,425)
2,425
—
—
—
Share buyback
(149)
149
(13,367)
(13,367)
—
(13,367)
Credit to equity for
equity-settled share-based
payments
26
—
211
465
676
—
676
Acquisition of non-
controlling interest
12
—
—
(3,423)
(3,423)
(10,618)
(14,041)
Transactions with owners
(140)
(1,967)
(46,239)
(48,346)
(15,068)
(63,414)
At 1 January 2024
9,062
53,263
422,748
485,073
20,000
505,073
At 31 December 2024
8,922
53,887
462,938
525,747
7,722
533,469
Profit for the year
—
2,390
50,097
52,487
3,911
56,398
Other comprehensive
expense for the year
—
(515)
(769)
(1,284)
(22)
(1,306)
Total comprehensive income
for the year
—
1,875
49,328
51,203
3,889
55,092
Issue of share capital
25
6
(6)
—
—
—
—
Dividends paid
10
—
—
(28,188)
(28,188)
(1,551)
(29,739)
Dividends from associates
15
—
(3,566)
3,566
—
—
—
Share buyback
(123)
123
(9,678)
(9,678)
—
(9,678)
Credit to equity for
equity-settled share-based
payments
26
—
294
260
554
—
554
Transactions with owners
(117)
(3,155)
(34,040)
(37,312)
(1,551)
(38,863)
At 1 January 2023
9,179
54,543
407,460
471,182
17,662
488,844
At 31 December 2023
9,062
53,263
422,748
485,073
20,000
505,073
Consolidated statement of changes in equity
For the year ended 31 December 2024
67
Note
2024
US$’000
*2023
US$’000
Net cash generated by operating activities
29
135,800
79,674
Investing activities
Acquisition of subsidiaries, net of cash acquired
12
—
(34,516)
Purchase of property, plant and equipment
14
(21,630)
(38,282)
Purchase of intangible assets
13
(24)
(25)
Interest received
6
1,050
600
Repayment of loans made to smallholder co-operatives
2,291
738
New loans to smallholder co-operatives
(1,608)
(2,931)
Bank deposits treated as current asset investments
44
(266)
Proceeds on disposal of property, plant and equipment
548
6,997
Net cash used by investing activities
(19,329)
(67,685)
Financing activities
Acquisition of non-controlling interest
12
(6,000)
—
New borrowings
637
—
Repayment of borrowings
(21,145)
(17,405)
Dividends paid to Company shareholders
(32,339)
(28,188)
Dividends paid to non-controlling interest
(3,145)
(155)
Issue of Company shares
107
—
Buyback of Company shares
(13,367)
(9,678)
Net cash used by financing activities
(75,252)
(55,426)
Net increase/(decrease) in cash and cash equivalents
41,219
(43,437)
Net cash and cash equivalents at 1 January
39,324
82,503
Effect of foreign-exchange rates on cash and cash equivalents
(1,320)
258
Cash and cash equivalents at 31 December
20
79,223
39,324
* Certain cash flows relating to balances with smallholder co-operatives have been amended above and in note 29 for consistency with
the current year treatment.
Consolidated cash-flow statement
For the year ended 31 December 2024
68
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
1 General information
M.P. Evans Group PLC is a public limited company incorporated in the United Kingdom under the Companies Act 2006 and listed
on the London Stock Exchange’s Alternative Investment Market (“AIM”), Company number 1555042. The Company is registered
in England and Wales, and the address of its registered office is given on page 104. The nature of the Group’s operations and its
principal activities are set out in note 4.
The functional currency of M.P. Evans Group PLC, determined under IAS 21, is the US Dollar. Likewise, the functional currency of
subsidiaries operating in the palm-oil sector is the US Dollar, reflecting the primary economic environment in which the Group
operates. The presentational currency for the Group accounts is also the US Dollar.
As permitted by section 408 of the Companies Act 2006, the Company has elected not to present its own income statement for
the year. M.P. Evans Group PLC reported a profit for the year of US$45,961,000 (2023 – US$46,102,000). The Company’s separate
financial statements are set out on pages 92 to 97.
By virtue of Section 479A of the Companies Act 2006, the Company’s subsidiary Bertam Consolidated Rubber Company Limited is
exempt from the requirement to have an audit and prepare individual accounts. Details of all subsidiary companies are shown on
page 98.
2 Adoption of new and revised accounting standards
(a) New and amended standards adopted by the Group
There have been a number of new and amended standards issued by the International Accounting Standards Board (“IASB”)
that became effective for the first time during the year ended 31 December 2024. The Group has assessed each of them and
concluded that the following standards and amendments have not had a material impact on the Group’s results or financial
position.
IFRS 16 Lease liability in a sale and leaseback
IAS 1 Classification of liabilities as current or non-current
IAS 1 Non-current liabilities with covenants
IAS 7 Supplier finance arrangements
(b) New standards, amendments and interpretations issued but not effective for the year beginning 1 January 2024 and not
adopted early
At the date of authorisation of these financial statements, a number of new and revised IFRSs have been issued by the IASB
but are not yet effective, as listed below. The directors continue to perform a review of each of the new and revised standards
and, based on the Group’s current operations and accounting policies, are assessing the impact of any material change in the
Group’s financial reporting.
IFRS 9 Amendments to the classification and measurement of financial instruments
IFRS 9 and 7 Contracts referencing nature-dependent electricity
IFRS18 Presentation and disclosure in financial statements
IFRS19 Subsidiaries without public accountability
IAS 21 Lack of exchangeability
3
Accounting policies
(a) Accounting convention and basis of presentation
The consolidated financial statements of M.P. Evans Group PLC have been prepared in accordance with UK-adopted
International Accounting standards and with the requirements of the Companies Act 2006 as applicable to companies
reporting under International Financial Reporting Standards (IFRS). They have been prepared under the historical cost
convention, except for items that are required by IFRS to be measured at fair value, principally biological assets. The Group’s
financial statements therefore comply with the AIM rules.
(b) Going concern
The financial statements have been prepared on a going-concern basis. The directors have conducted a review of projected
cash flows from operations, investing and financing considering in detail the period up to the end of 2026, including risks and
sensitivities, concluding that the Group has sufficient projected funds to carry on its business and its planned investment
programme in the medium term. Furthermore, the Group has control over its main cash expenditure, investment in its new
estates and planting, which it can manage according to the resources available. Further details are given in the report of the
directors on page 44.
Notes to the consolidated accounts
For the year ended 31 December 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
69
3 Accounting policies continued
(c) Basis of consolidation
The Group financial statements consolidate the financial statements of the Company and all of its subsidiaries, and equity
accounts for its associated undertakings. The Group treats as subsidiaries those entities in which it has power over the
investee, has the rights or exposure to variable returns, and has the ability to affect those returns. All subsidiary and
associated undertakings prepare their financial statements to 31 December.
Where necessary, the financial statements of subsidiary and associated companies are adjusted prior to consolidation or
equity accounting to bring them into line with the Group’s accounting policies. All intra-Group transactions, balances, income
and expenses are eliminated on consolidation. The results of subsidiaries or associated companies acquired or disposed of
during the year are included in the consolidated income statement from or up to the effective point of gaining or losing either
control or significant influence as appropriate.
Non-controlling interests in the net assets of subsidiaries are separately identified. They consist of non-controlling interests at
the date of business combination, and the non-controlling interest’s share of subsequent changes in equity.
On disposal of a subsidiary or associated company, the gain or loss on disposal is calculated as the difference between the
fair value of the proceeds received and the Group’s consolidated carrying value of the assets and liabilities of the subsidiary
or associated undertaking, including goodwill where relevant. If required by IFRS 5, results (including comparative amounts) of
the disposed of subsidiary or associated undertaking are included within discontinued operations.
(d) Revenue
Revenue represents the consideration due for CPO, PK and ffb sold during the year, excluding sales taxes. Income is recognised
at the point of delivery, which is deemed to be the point at which the performance obligation is satisfied. Payment terms are
cash on delivery. However, in some circumstances credit is offered to selected customers, on up to 30-day terms.
(e) Retirement benefits
In the UK, the Group operates a defined-contribution pension scheme. The pension charge represents the contributions
payable by the Group under the rules of the scheme.
In Indonesia, as required by law, a lump sum is paid to employees on retirement or on leaving the Group’s employment.
This terminal benefit is unfunded, but the expense is accrued by the Group based on an annual actuarial review using the
projected unit credit method and charged to the income statement on the basis of individuals’ service at the balance-sheet
date. Remeasurement by the actuary is included in equity through other comprehensive income or expense, whilst all other
movements in the liability, other than benefits paid, are recognised in profit or loss.
(f) Share-based payments
The Group issues equity-settled, share-based payments to certain employees. Such share-based payments are measured at
fair value (excluding the effect of any non-market-based vesting conditions) at the date of grant. The fair value determined at
the grant date of the equity-settled, share-based payments is expensed on a straight-line basis over the vesting period, based
on the Group’s estimate of shares that will eventually vest. Fair value is measured by application of the Black-Scholes model,
using management’s best estimates assuming that: options are exercised in the middle of the exercise period for market-priced
options and at the start of the exercise period for options issued under the long-term incentive scheme; dividend yield is the
latest annual dividend divided by the share price on the date the options are granted; share-price volatility is assessed as
the average standard deviation over one year using share prices since 1 January 1993. At each balance-sheet date the Group
estimates the number of options it expects to vest. Any changes from the previous estimate are recognised in the income
statement.
(g) Business combinations and goodwill
On acquisition of shares in subsidiary companies or associated undertakings, the directors compare the fair value of the
consideration given for the shares with the fair value of the identifiable net assets acquired, including an estimation of the fair
value of property, plant and equipment, intangible fixed assets and biological assets. This comparison is used to establish the
value of goodwill or the excess of fair value of the identifiable net assets and liabilities acquired over their cost.
Goodwill arising on acquisition is ascribed to an operating subsidiary and capitalised, with provision being made for any
impairment. Goodwill is tested for impairment at least annually but provisions, once made, are not reversed.
Notes to the consolidated accounts continued
70
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
3 Accounting policies continued
(h) Biological assets
For internal reporting and decision making, the Group’s policy is to recognise fresh fruit bunches (“ffb”) at the point of harvest.
For the purposes of statutory reporting, the Group’s policy is to include an estimate of the fair value of ffb prior to harvest as
a biological asset in the Group’s financial statements (see note 17). The impact of initial valuations and subsequent changes in
value are included in the Group’s income statement. The valuation falls into the IFRS category ‘Level 3’, since sales of ffb prior
to harvest are never transacted.
Deferred tax is recognised at the relevant local rate on the difference between the estimated cost of biological assets and
their carrying value determined under IAS 41.
(i) Intangible assets
Intangible assets (other than goodwill) are stated at historical cost less amortisation. Software is written off over its estimated
useful life on a straight-line basis at 10% per annum. Estimated useful lives are reviewed at each balance-sheet date.
(j) Property, plant and equipment
Property, plant and equipment is stated at historical cost less depreciation. Historical cost includes all expenditure incurred
in acquiring the asset, including directly-attributable borrowing costs. Leasehold land in Indonesia is held on 25- or 35-year
leases and initial costs are not depreciated as the leases can be renewed without significant cost. Oil-palm plantings are
recognised at cost and depreciated, once they reach maturity, over 20 years. Perpetual-leasehold land in Malaysia is classified
as freehold land, which is not depreciated.
Buildings, plant, equipment and vehicles, are written off over their estimated useful lives on a straight-line basis. Estimated
useful lives are reviewed at each balance-sheet date. Where the board judges the residual value of an asset to exceed its
carrying value, as in the case of the UK office, no provision is made for depreciation.
Construction in progress is measured at cost and is not depreciated. Depreciation commences once assets are complete and
available for use.
Rates of depreciation
(per annum)
Land
0-3%
Buildings
3-20%
Planting
4-5%
Plant and equipment
5-50%
Vehicles
7-33%
(k) Leases
All leases are accounted for by recognising a right-of-use asset and a lease liability, except for leases of low-value assets and
leases with a duration of 12 months or less. Lease liabilities are measured at the present value of lease payments over the
term of the lease, and the right-of-use asset is measured at a corresponding amount. The asset is depreciated on a straight-
line basis over the lease term, and the lease payments are allocated to the lease liability and the interest implicit in the lease.
(l) Investments in associated companies
Undertakings over which the Group has the ability to exert significant influence, but not control, through shareholdings
and board membership, are treated as associated undertakings. Investments in associated undertakings are held in the
consolidated financial statements under the equity method of accounting. The consolidated income statement includes the
Group’s share of the profit or loss on ordinary activities after taxation based on audited financial information for the year
ended 31 December 2024. In the consolidated balance sheet, the investments in the associated undertakings are shown as the
Group share of net assets at the balance-sheet date less any profits deferred on sales made to associated companies.
(m) Inventories
Inventories are valued at the lower of cost and net realisable value. In the case of palm oil, cost represents the weighted-
average cost of production, including appropriate overheads. Other inventories are valued on the basis of first in, first out.
Young seedlings are included within nurseries as part of inventory, and their cost is transferred to immature planting within
property, plant and equipment when they are planted out in the field.
71
3
Accounting policies continued
(n) Taxation
The tax charge for the year comprises current and deferred tax. The Group’s current-tax asset or liability is calculated using tax
rates that have been enacted or substantively enacted by the balance-sheet date.
Deferred tax is accounted for using the balance-sheet-liability method, calculated at the tax rates that are expected to apply
in the period when the liability is settled, or the asset is realised. Liabilities are generally recognised for all taxable temporary
differences; deferred-tax assets are recognised if it is probable that taxable profits will be available against which deductible
temporary differences can be utilised. Deferred tax is not provided for on initial recognition of goodwill.
The Group recognises deferred-tax liabilities arising from taxable temporary differences on investments in subsidiaries and
associates, except where the Group is able to control the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. The carrying amount of deferred-tax assets is reviewed at each
balance-sheet date.
Deferred-tax assets and liabilities are offset when there is a legally-enforceable right to set off current-tax assets against
current-tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to
settle its current-tax assets and liabilities on a net basis.
(o) Financial instruments
Financial assets and financial liabilities are initially recognised on the Group’s balance sheet at fair value when the Group
becomes a party to the contractual provisions of the instrument and, other than the Group’s investments in unlisted shares,
are carried at amortised cost.
Financial assets at fair value through profit or loss — the Group’s investments in unlisted shares (other than associated
undertakings) are classified as fair value through profit or loss and stated at fair value, with gains and losses recognised
directly in the income statement. Fair value is the directors’ estimate of sales proceeds at the balance-sheet date.
Trade and other receivables — these represent both amounts due from customers in the normal course of business,
recoverable VAT, and financing made available to related parties and smallholder co-operatives. Balances are initially stated
at their fair value, and subsequently measured at amortised cost, using the effective-interest-rate method, as reduced by
appropriate allowances for estimated expected credit losses, which are charged to the income statement.
Current-asset investments — these include bank deposits with maturities expected to be within twelve months.
Cash and cash equivalents — these include cash at hand, and bank deposits with original maturities of three months or less.
Bank borrowings — interest-bearing bank loans and overdrafts are recorded at the proceeds received, net of direct issue costs.
Finance charges are accounted for on an accruals basis in the income statement using the effective-interest-rate method.
Trade and other payables — these are initially measured at fair value, and are subsequently measured at amortised cost, using
the effective-interest-rate method.
Deferred income — this represents cash payments made by customers in advance of delivery of the related product.
Equity instruments — equity instruments issued by the Company are recorded at the proceeds received, net of direct
issue costs.
(p) Foreign currencies
As set out in note 1, the functional currency of the parent Company and of subsidiaries operating in the palm-oil sector is the
US Dollar. The functional currency of Group companies operating in the property-development sector is the local currency,
the Malaysian Ringgit. Where relevant, results of all Group companies are translated for the purposes of consolidation into
the Group’s presentation currency, the US Dollar. The monetary assets and liabilities of the Group’s foreign operations are
translated at exchange rates on the balance-sheet date. Items in the income statement are translated at the average exchange
rate for the period.
Exchange differences are recognised as a profit or loss in the period in which they arise, except for exchange differences
on monetary items payable to foreign operations where settlement is neither planned nor likely to occur, in which case the
difference is recognised initially in other comprehensive income. In addition, exchange differences arising from translating
the results of Group companies that do not have the US Dollar as their functional currency are also recognised in other
comprehensive income.
Notes to the consolidated accounts continued
72
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
3
Accounting policies continued
(q) Segmental reporting
Operating segments are consistent with the internal reporting provided to the chief operating-decision maker. The chief
operating-decision maker, which is responsible for allocating resources and assessing performance of the operating segments,
is the board of directors. The Group’s reportable operating segments are included in note 4(b).
(r) Critical accounting judgements and key sources of estimation uncertainty
The preparation of consolidated financial statements under IFRS requires the Group to make estimates and assumptions that
affect how its policies are applied and hence the amounts reported in the financial statements. Estimates and judgements are
periodically evaluated. They are based on historical experience and other factors including expectations of future events that
are believed to be reasonable under the circumstances. Actual results may differ from estimates.
The critical judgements and key estimates which have the most significant impact on the carrying amount of assets and
liabilities are identified below and discussed further in the relevant notes to the accounts.
Critical judgements
•
Deferred tax on unremitted earnings (note 23);
•
Depreciation of leasehold land (note 14); and
•
Treatment of acquisitions in the prior year (note 12).
Key estimates
•
Carrying value of deferred-tax assets relating to losses (note 23);
•
Determination of retirement-benefit obligations (note 24);
•
Carrying value of goodwill (note 13);
•
Valuation of biological assets — growing produce (note 17); and
•
Fair values on business combinations (note 12).
4 Revenue and segment information
(a) Revenue
Plantation
Indonesia
US$’000
Other
US$’000
Total
US$’000
2024
Sales of crude palm oil
297,807
—
297,807
Sales of palm kernels
40,912
—
40,912
Sales of fresh fruit bunches
14,120
—
14,120
Other
—
—
—
352,839
—
352,839
2023
Sales of crude palm oil
266,493
—
266,493
Sales of palm kernels
28,637
—
28,637
Sales of fresh fruit bunches
12,190
—
12,190
Other
—
48
48
307,320
48
307,368
The Group sells some crop (fresh fruit bunches) to outside mills for processing, with a selling price based on the CPO market
and an assumed rate of extraction. Crude palm oil and palm kernels are sold through volume-based contracts or as spot sales
following a tender from a customer.
73
4 Revenue and segment information continued
(b) Segment information
The Group’s reportable segments are distinguished by location and activity: palm-oil plantations in Indonesia and property
development in Malaysia. The ‘other’ segment relates in the main to the Group’s UK head office.
Plantation
Indonesia
US$’000
Property
Malaysia
US$’000
Other
US$’000
Total
US$’000
2024
Continuing operations
Revenue
352,839
—
—
352,839*
Gross profit
116,590
—
—
116,590
Gain on biological assets
1,847
—
—
1,847
Foreign-exchange gain/(loss)
40
—
(63)
(23)
Other administrative expenses
(716)
—
(5,214)
(5,930)
Other income
3,201
—
10
3,211
Operating profit
115,695
Finance income
965
—
271
1,236
Finance costs
(1,310)
—
(2,131)
(3,441)
Profit before tax
113,490
Tax
(24,142)
—
(1,071)
(25,213)
Profit after tax
88,277
Share of associated companies’ profit after tax
1,396
959
—
2,355
Profit for the year
90,632
Consolidated total assets
Non-current assets
499,841
—
946
500,787
Current assets
118,229
—
18,255
136,484
Investments in associates
5,316
5,208
—
10,524
623,386
5,208
19,201
647,795
Consolidated total liabilities
Liabilities
101,915
—
12,411
114,326
Other information
Additions to property, plant and equipment
21,611
—
19
21,630
Additions to intangible assets
24
—
—
24
Depreciation
26,472
—
19
26,491
Amortisation
184
—
—
184
* US$177.6 million of revenue (50.3%) was from sales to 2 customers (39.7% and 10.6% respectively).
Notes to the consolidated accounts continued
74
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
4 Revenue and segment information continued
(b) Segment information continued
Plantation
Indonesia
US$’000
Property
Malaysia
US$’000
Other
US$’000
Total
US$’000
2023
Continuing operations
Revenue
307,320
—
48
307,368*
Gross profit
78,405
—
48
78,453
Gain on biological assets
551
—
—
551
Foreign-exchange loss
(833)
—
(355)
(1,188)
Other administrative expenses
(458)
—
(4,985)
(5,443)
Other income
2,913
—
10
2,923
Operating profit
75,296
Finance income
564
—
784
1,348
Finance costs
(298)
—
(3,512)
(3,810)
Profit before tax
72,834
Tax
(17,721)
—
(1,105)
(18,826)
Profit after tax
54,008
Share of associated companies’ profit after tax
1,107
1,283
—
2,390
Profit for the year
56,398
Consolidated total assets
Non-current assets
505,263
—
9,819
515,082
Current assets
91,210
—
8,853
100,063
Investments in associates
5,821
4,182
—
10,003
602,294
4,182
18,672
625,148
Consolidated total liabilities
Liabilities
87,185
—
32,890
120,075
Other information
Additions to property, plant and equipment
42,672
—
52
42,724
Additions to intangible assets
25
—
—
25
Depreciation
24,090
—
12
24,102
Amortisation
180
—
—
180
* US$160.5 million of revenue (52.2%) was from sales to 2 customers (34.3% and 17.9% respectively).
75
5
Employees
2024
US$’000
2023
US$’000
Employee costs during the year
Wages and salaries
48,677
47,417
Social security costs
3,575
3,517
Current service cost of retirement benefit (see note 24)
2,270
1,770
Other pension costs
312
437
Share-based payment charge
676
554
55,510
53,695
2024
Number
2023
Number
Average monthly number of people employed (including executive directors)
Estate manual
12,504
12,701
Local management
99
102
United Kingdom head office
7
7
12,610
12,810
Included in the table above are costs relating to key management personnel, those persons having authority and responsibility for
planning, directing and controlling the activities of the Group. Total directors’ emoluments for the year were £2.0 million
(2023 £2.3 million). Emoluments for the highest paid director were £0.9 million (2023 £0.9 million). The total gain on exercise of
share options by the directors was £0.2 million (2023 £0.1 million). The total gain on exercise of share options by the highest paid
director was £0.1 million (2023 nil). The total number of directors for whom contributions were made to defined contribution
pension arrangements was 2 (2023 – 2), in the current year the highest paid director received contributions to defined contribution
pension arrangements of £0.0 million (2023 did not). In addition to amounts paid to directors, other key management personnel
received a further £0.3 million (2023 £0.3 million) in short-term employee benefits during the year.
6 Finance income
2024
US$’000
2023
US$’000
Interest receivable on bank deposits
1,050
600
Interest receivable on related party loans
186
748
1,236
1,348
7
Finance costs
2024
US$’000
2023
US$’000
Interest payable on bank loans and overdrafts
3,441
3,810
Notes to the consolidated accounts continued
76
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
8 Profit before tax
2024
US$’000
2023
US$’000
Profit before tax is stated after charging:
Depreciation of property, plant and equipment
26,491
24,102
Amortisation of intangible assets
184
180
Auditors’ remuneration*
493
451
Employee costs (note 5)
55,510
53,695
The analysis of auditors’ remuneration is as follows:
Audit of UK parent Company
38
36
Audit of consolidated financial statements
212
198
Audit of overseas subsidiaries
236
191
Total audit services
486
425
Taxation advisory services
—
—
Total non-audit services
—
—
* In addition to the above, US$7,000 (2023 US$26,000) were payable to other firms for the audit of subsidiary companies.
9 Tax on profit on ordinary activities
2024
US$’000
2023
US$’000
United Kingdom corporation tax charge for the year
860
857
Relief for overseas taxation
(860)
(857)
—
—
Overseas taxation
23,503
15,851
Adjustments in respect of prior years
—
2,539
Total current tax
23,503
18,390
Deferred taxation — origination and reversal of temporary differences (see note 23)
1,710
436
25,213
18,826
The standard rate of tax for the year, based on the weighted average of standard tax rates applied in the United Kingdom during
2024 was 25% (2023 – 23.52%). The standard rate of Indonesian tax was 22% (2023 – 22%). As the parent Company is based in
the UK, when preparing the reconciliation of the effective tax rate, the Group uses the UK corporation tax rate, notwithstanding
that the majority of the Group’s business is based in Indonesia. The reconciliation includes a line to show the impact of the
difference in tax rates, the majority of which reflects the difference between the Indonesian and UK standard rate of corporation
tax. The actual tax charge is lower than the standard rate for the reasons set out in the reconciliation below.
2024
US$’000
2023
US$’000
Profit on ordinary activities before tax
113,490
72,834
Tax on profit on ordinary activities at the standard rate
28,373
17,131
Factors affecting the charge for the year
Profits taxed at lower standard tax rate
(3,292)
(1,039)
Expenses not deductible
1,634
1,407
Lower rate on fixed asset disposals
(25)
(22)
Withholding tax on overseas dividends and interest
211
247
Adjustment relating to intercompany loan relationships
803
737
Unrelieved losses
(684)
(345)
Other differences
(1,807)
(1,829)
Adjustment to tax charge in respect of prior periods
—
2,539
Total tax charge
25,213
18,826
In addition to the above, the Group recognised a tax charge of US$0.2 million (2023 – credit of US$0.1 million) on retirement
benefit obligation remeasurement gains (2023 – losses), recorded in other comprehensive income.
77
10 Dividends paid and proposed
2024
US$’000
2023
US$’000
2024 interim dividend – 15p per 10p share (2023 interim dividend 12.5p)
10,448
8,153
2023 final dividend – 32.5p per 10p share (2022 final dividend 30p)
21,891
20,035
32,339
28,188
Following the year end, the board has proposed a final dividend for 2024 of 37.5p per 10p share, amounting to US$24.5 million.
The dividend will be paid on or after 19 June 2025 to shareholders on the register at the close of business on 25 April 2025.
11 Basic and diluted earnings per share
The calculation of earnings per 10p share is based on:
2024
US$’000
2024
No. of shares
2023
US$’000
2023
No. of shares
Profit for the year attributable to the owners of
M.P. Evans Group PLC
87,851
52,487
Average number of shares in issue
52,962,578
53,753,331
Diluted average number of shares in issue*
53,223,589
53,981,990
* The difference between the number of shares in issue and the diluted number of shares relates to unexercised share options held by directors and
key employees of the Group as at 31 December 2024.
12 Acquisitions
On 31 May 2024, the Group completed the purchase of the 5% minority holding in the majority (70% by Group-owned planted
hectarage) of its Indonesian subsidiary trading companies.
The total cost of the purchase was US$14.0 million. The Group’s minority partner has used the majority of the proceeds to
repay an outstanding US$8.0 million loan from the Group and, as a result, the net cash outflow to the Group resulting from the
transaction was US$6.0 million.
2024
US$’000
Consideration paid to non-controlling interest
14,041
Carrying value of non- controlling interest
(10,618)
Difference recognised in retained earnings
3,423
On 6 March 2023, the Group acquired 100% of the shares in two Indonesian companies, PT Teunggulon Raya and PT Dharma Agung
for gross consideration of US$15.5 million. The companies have 2,100 hectares planted with oil palm, and all of the planted areas
are fully titled, with long leaseholds already established. The planted land is close to the Group’s Simpang Kiri estate in Aceh
province, northern Sumatra.
The transaction was treated as an asset acquisition, based on the concentration test guidelines in IFRS 3. Net consideration of
US$11.0 million was paid, made up of assets acquired of US$15.5 million and liabilities assumed of US$4.5 million. Of the assets
acquired, US$15.0 million related to the planted hectarage.
On 23 November 2023, the Group acquired 100% of the shares in two further Indonesian companies, PT Agro Bumi Kaltim (“ABK”)
and PT Nusantara Agro Sentosa (“NAS”). On acquisition, ABK and NAS had 8,350 hectares planted with oil palm, and all planted
areas were fully titled, with long leaseholds already established. All the planted land is in East Kalimantan, relatively close to the
Group’s Kota Bangun estate.
Notes to the consolidated accounts continued
78
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
12 Acquisitions continued
As disclosed in last year’s annual report, the fair value of the identifiable assets acquired and liabilities assumed had only been
determined on a provisional basis due to the timing of the acquisitions. These provisional fair values were finalised in 2024
without further adjustment.
Provisional at
31 December
2023
US$’000
Adjustment
US$’000
Final at
31 December
2024
US$’000
Property, plant and equipment
57,199
—
57,199
Current assets
6,213
—
6,213
Deferred tax assets
109
—
109
Cash and cash equivalents
1,713
—
1,713
Current liabilities
(449)
—
(449)
Liabilities due to related parties
(5,504)
—
(5,504)
Retirement benefit obligations
(275)
—
(275)
Bank loans
(22,488)
—
(22,488)
Deferred tax liabilities
(5,605)
—
(5,605)
Net assets acquired
30,913
—
30,913
Goodwill
5,316
—
5,316
Gross consideration
36,229
—
36,229
Adjustment for cash and cash equivalents acquired
(1,713)
—
(1,713)
Net cash outflow relating to business combinations
34,516
—
34,516
13 Intangible assets
Goodwill
US$’000
Software
US$’000
Total
US$’000
Cost
At 1 January 2024
17,083
1,814
18,897
Additions
—
24
24
At 31 December 2024
17,083
1,838
18,921
Accumulated amortisation
At 1 January 2024
—
802
802
Charge for the year
—
184
184
At 31 December 2024
—
986
986
Net book value at 31 December 2024
17,083
852
17,935
Cost
At 1 January 2023
11,767
1,789
13,556
Acquisitions (see note 12)
5,316
—
5,316
Additions
—
25
25
At 31 December 2023
17,083
1,814
18,897
Accumulated amortisation
At 1 January 2023
—
622
622
Charge for the year
—
180
180
At 31 December 2023
—
802
802
Net book value at 31 December 2023
17,083
1,012
18,095
Goodwill is carried at cost. Of the balance above US$10.6 million relates to the Group’s project at Bumi Mas, US$5.9m relates to
the Group’s project at Kota Bangun, with the remainder relating to the Group’s projects at Bangka and the Pangkatan group.
79
13 Intangible assets continued
Key estimate
A review for goodwill impairment has been undertaken by comparing the carrying value of the relevant cash generating
units, being the six estates as described on pages 6 and 7, with their value in use. Value in use has been obtained by
reference to independent valuations of the Group’s property assets conducted at the end of 2024 (see page 100).
These cash-flow valuations used a 30-year forecast period, to reflect the nature and growth profile of the asset and its
long-term resilience to variations in climate and weather patterns, a pre-tax inflation-adjusted discount rate of 16%
(2023 - 16%), and a mill-gate price for CPO of US$700 for two years before reverting to US$680 as a long-term average
(2023 two years at US$666 followed by US$642 for the long term). A decrease in any of the CPO price, yield or extraction
assumptions of up to 10% would not result in any impairment (2023 nil impairment) of the goodwill relating to Bumi
Mas or Kota Bangun.
14 Property, plant and equipment
Leasehold
land
US$’000
Planting
US$’000
Buildings
US$’000
Plant &
equipment
US$’000
Vehicles
US$’000
Construc-
tion in
progress
US$’000
Total
US$’000
Cost or valuation
At 1 January 2024
160,988
245,669
143,196
79,443
19,448
9,333
658,077
Additions
3,585
9,225
134
1,054
2,073
5,559
21,630
Re-classification
81
—
6,143
22
72
(6,318)
—
Disposals
—
(2,859)
(719)
(128)
(530)
—
(4,236)
At 31 December 2024
164,654
252,035
148,754
80,391
21,063
8,574
675,471
Accumulated depreciation
At 1 January 2024
218
74,701
51,377
33,923
10,943
—
171,162
Charge for the year
52
10,790
7,943
5,840
1,866
—
26,491
Disposals
—
(2,309)
(275)
(119)
(462)
—
(3,165)
At 31 December 2024
270
83,182
59,045
39,644
12,347
—
194,488
Net book value at 31 December 2024
164,384
168,853
89,709
40,747
8,716
8,574
480,983
Cost or valuation
At 1 January 2023
114,438
214,786
124,890
66,007
16,072
24,116
560,309
Additions
15,062
8,989
414
1,048
2,540
14,671
42,724
Acquisition (see note 12)
31,488
21,897
2,367
164
1,253
30
57,199
Re-classification
—
—
16,339
13,107
38
(29,484)
—
Disposals
—
(3)
(814)
(883)
(455)
—
(2,155)
At 31 December 2023
160,988
245,669
143,196
79,443
19,448
9,333
658,077
Accumulated depreciation
At 1 January 2023
187
64,893
44,366
29,341
9,864
—
148,651
Charge for the year
31
9,810
7,438
5,424
1,399
—
24,102
Disposals
—
(2)
(427)
(842)
(320)
—
(1,591)
At 31 December 2023
218
74,701
51,377
33,923
10,943
—
171,162
Net book value at 31 December 2023
160,770
170,968
91,819
45,520
8,505
9,333
486,915
Included in planting is immature planting with a cost of US$19,006,000 (2023 US$15,008,000).
Critical judgement
Included in leasehold land is land in Indonesia which is not being depreciated. Land is held on 25- or 30-year leases,
and as those leases can be renewed without significant cost and the Group has previous experience of successful lease
renewals, the directors have concluded that the land should not be depreciated. The carrying value of the land at the end
of the year is US$162,978,000 (2023 US$159,615,000).
Notes to the consolidated accounts continued
80
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
14 Property, plant and equipment continued
As at 31 December 2024, the Group had entered into contractual commitments for the acquisition of property, plant and
equipment of US$485,000 (2023 US$1,884,000).
Depreciation and amortisation is charged to cost of sales, other than US$21,000 (2023 US$12,000) charged to other administrative
expenses.
Property, plant and equipment additions for 2023 included US$15.3 million of the assets acquired in the prior period as set out in
note 12.
15 Investments in associates
Details of the Group’s subsidiary and associated undertakings are given on page 98. The Group’s associated companies are
both unlisted.
2024
US$’000
2023
US$’000
Share of net assets
At 1 January
20,610
22,494
Exchange differences
491
(708)
Profit for the year
2,355
2,390
Dividends received
(2,425)
(3,566)
At 31 December
21,031
20,610
Unrealised profit - deferral on land sales to associate
(10,507)
(10,607)
10,524
10,003
A separate reserve is maintained for the share of profit or loss in the associates. As a result, dividends received are reclassified
from the share of associates reserves to retained earnings.
The summarised results of the Group’s associated undertakings and the Group’s aggregate share of their summarised results are
shown below:
2024
2023
Kerasaan
US$’000
Bertam
Properties
US$’000
Total
US$’000
Kerasaan
US$’000
Bertam
Properties
US$’000
Total
US$’000
Total
Revenue
8,183
19,558
7,417
23,793
Profit after tax
3,672
2,398
2,916
3,206
Non-current assets
9,317
44,552
10,145
46,554
Current assets
2,034
31,615
2,104
27,026
Current liabilities
(1,156)
(14,875)
(811)
(13,497)
Non-current liabilities
(877)
(17,567)
(792)
(18,671)
Net assets
9,318
43,725
10,646
41,412
Group share
(38%)
(40%)
(38%)
(40%)
Revenue
3,110
7,823
10,933
2,818
9,517
12,335
Profit after tax
1,396
959
2,355
1,108
1,282
2,390
Non-current assets
3,540
17,821
21,361
3,855
18,622
22,477
Current assets
773
12,646
13,419
799
10,810
11,609
Current liabilities
(439)
(5,950)
(6,389)
(308)
(5,399)
(5,707)
Non-current liabilities
(333)
(7,027)
(7,360)
(301)
(7,468)
(7,769)
Carrying value at 31 December
3,541
17,490
21,031
4,045
16,565
20,610
81
16 Investments
2024
US$’000
2023
US$’000
Financial assets at fair value through profit or loss (unlisted)
At 1 January
59
61
Exchange differences
2
(2)
At 31 December
61
59
17 Current biological assets
2024
US$’000
2023
US$’000
Ffb prior to harvest
5,635
3,788
Oil palms are harvested continuously, many times throughout the year, and, at any given time, each palm will be at a different
point in its production cycle. It is not possible to undertake a full census of all palms, and so it is necessary to measure the
volume of growing ffb indirectly. The gain or loss shown in the consolidated income statement represents the net movement
in the fair value of ffb prior to harvest during the year. During the year, all of the opening balance of ffb prior to harvest was
harvested whilst all of the closing balance arose in the year due to gains in fair value less costs to sell.
Key estimate
The estimation in respect of ffb prior to harvest is based on the market price of ffb in each of the Group’s locations on
31 December, less the cost of harvesting and transport to mill. The market price is applied to a weight of ffb. This weight
derives from the assumption that value accrues exponentially to ffb from the increase in oil content in the four weeks
prior to harvest: in terms of tonnage at any given month end, equivalent to 32% of the following month’s crop.
The chosen valuation methodology determines the value presented for ffb prior to harvest. Changes to the assumed
tonnage will have a directly equivalent proportional effect on the reported valuation. Different valuation methods will
give differing answers. Changes to both tonnage and methodology lead to a range of valuations between US$5.5 million
and US$9.1 million. The Group has never included ffb prior to harvest in its internal reporting and decision-making.
18 Inventories
2024
US$’000
2023
US$’000
Processed produce for sale
10,763
11,040
Estate stores
10,320
11,221
Nurseries
1,705
1,894
22,788
24,155
Notes to the consolidated accounts continued
82
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
19 Trade and other receivables
2024
US$’000
2023
US$’000
Current assets
Trade receivables
2,291
1,799
Receivable from smallholder co-operatives
8,623
12,181
Loans to related parties
—
285
Other receivables
7,781
7,714
Prepayments and accrued income
2,152
1,874
20,847
23,853
Non-current assets
Loans to related parties
—
8,875
—
8,875
Trade and other receivables analysed by currency of receivable:
Indonesian Rupiah
19,848
22,313
US Dollar
330
10,302
Sterling
667
111
Malaysian Ringgit
2
2
20,847
32,728
The majority of palm-oil sales are made for cash payment in advance of delivery. At 31 December 2024 there was no provision
for impairment of trade receivables (2023 US$nil). The directors consider that the carrying amount of trade and other receivables
approximates their fair value.
The Group makes finance available to its associated smallholder co-operatives, both during the immature stage of initial
plantings, and as working capital facilities for mature areas. It also provides financial guarantees for some bank loans of US$61.8
million (2023 US$60.8 million) provided to its associated smallholders. All balances due from smallholders, including those
for immature areas, are repayable on demand. However, the Group may allow a longer period of finance at its discretion. At an
early stage in the development of a new project, costs are incurred but not yet allocated to a specific smallholder, awaiting the
completion of further development.
The Group’s expected credit loss on its trade and other receivables and financial guarantees is not material. The Group applies
the simplified approach in IFRS 9 in determining expected credit losses on trade receivables, taking account of their similar risk
characteristics and the Group’s experience. In assessing expected credit losses on non-trade receivables and financial guarantees
under IFRS 9, the Group considers the long-standing relationship with its stakeholders, the ongoing trading of its associated
smallholders, and its ability to continue to recover balances in a planned and controlled manner.
Given the above, receivables from smallholders have been classified as current assets with the exception of those balances not
yet allocated to a specific smallholder co-operative which are expected to take greater than 12 months to recover. An analysis of
the balance is as follows:
2024
US$’000
2023
US$’000
Immature areas - allocated
4,566
4,989
Mature areas
4,057
7,192
Current asset
8,623
12,181
Non-current asset — immature areas — not allocated
—
—
8,623
12,181
83
20 Cash and other liquid resources
2024
US$’000
2023
US$’000
Cash and cash equivalents
79,223
39,324
Current-asset investments
214
270
79,437
39,594
Cash and cash equivalents comprise cash held by the Group and short-term bank deposits with an original maturity of three
months or less. Current-asset investments are bank deposits acquired during the prior year, which have been pledged as security
against bank loans. It is expected that the deposits will be returned within twelve months. The carrying value of these assets
approximates their fair value.
21 Trade and other payables
2024
US$’000
2023
US$’000
Current liabilities
Trade payables
9,366
7,160
Payable to smallholder co-operatives
10,949
4,001
Deferred income
4,649
4,356
Other payables
8,158
12,030
33,122
27,547
The average credit period taken for trade purchases is 29 days (2023 – 32 days). The Group has processes in place to ensure
payables are settled within the agreed terms. The amounts above also reflect the Group’s anticipated cash outflows for these
financial liabilities. Deferred income relates to payments received in advance of delivery of the related products. All of the
amounts in the opening balance were recognised in revenue during the year, whilst the closing balance arose entirely due to
payments received during 2024.
22 Borrowings
2024
US$’000
2023
US$’000
Secured borrowing at amortised cost
Bank loans
33,027
54,422
Total borrowings
Amount due for settlement within one year
12,953
21,009
Due for settlement in one to two years
3,074
12,279
Due for settlement in two to five years
17,000
21,134
Amount due for settlement after one year
20,074
33,413
33,027
54,422
Analysis of borrowings by currency:
US Dollar
11,034
31,674
Indonesian Rupiah
21,993
22,748
33,027
54,422
Analysis of anticipated cash outflows:
Within one year
14,818
24,441
Due within one to two years
4,555
14,207
Due within two to five years
19,356
25,876
38,729
64,524
Bank loans have been provided from lenders in Malaysia and Indonesia to support the Group’s Indonesian operations. They are
secured against certain assets within subsidiary companies, comprising share certificates, land titles and fixed assets. The net
book value of property, plant and equipment used as security for bank loans is US$109.7 million (2023 US$112.4 million). Bank
loans denominated in Indonesian Rupiah, classified as being due in more than one year, are subject to certain covenants. They
Notes to the consolidated accounts continued
84
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
22 Borrowings (continued)
include the borrowing subsidiaries maintaining (i) a net asset position, (ii) a debt service cover ratio of at least 100%, (iii) a debt-
to-equity ratio of no more than 5:1 and (iv) share capital of at least 25% of fixed assets. These covenants are in place throughout
2025, and the Group is confident that should any covenant breach occur, it would be able to re-finance the loans or repay them in
full. At the year end, the Group had undrawn available credit facilities of US$30 million (2023 US$30 million).
The weighted-average interest rate paid on bank loans in the year was 7.6% (2023 – 8.2%).
The analysis of anticipated cash outflows above is based on interest and exchange rates in force at the balance-sheet date.
23 Deferred tax
The following are the major deferred-tax liabilities and assets recognised by the Group and movements thereon:
Accelerated
tax
depreciation
US$’000
Retirement-
benefit
obligations
US$’000
Fair value
adjustments
on acquisition
US$’000
Other
timing
differences
US$’000
Total
US$’000
At 1 January 2024
(10,955)
2,841
(13,803)
3,657
(18,260)
Charge to income statement
54
279
—
(2,043)
(1,710)
Charge to other comprehensive income
—
(193)
—
—
(193)
Foreign-exchange differences
—
(36)
—
—
(36)
At 31 December 2024
(10,901)
2,891
(13,803)
1,614
(20,199)
At 1 January 2023
(9,523)
2,194
(8,488)
3,268
(12,549)
Arising on acquisitions
(316)
158
(5,315)
95
(5,378)
Charge to income statement
(1,116)
386
—
294
(436)
Credit to other comprehensive income
—
103
—
—
103
At 31 December 2023
(10,955)
2,841
(13,803)
3,657
(18,260)
Other timing differences relate in the main to losses. Certain deferred-tax assets and liabilities have been offset. The following is
the analysis of deferred-tax balances (after offset) for financial reporting purposes:
2024
US$’000
2023
US$’000
Deferred-tax assets
1,808
1,138
Deferred-tax liabilities
(22,007)
(19,398)
(20,199)
(18,260)
Critical judgement
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 US$660,023,000 (2023 US$517,604,000).
No liability has been recognised in respect of these differences because either the Group is in a position to control the
timing of the reversal of the temporary differences, or such a reversal would not give rise to an additional tax liability.
At the balance-sheet date, the aggregate amount of temporary differences associated with undistributed earnings of
associates for which deferred-tax liabilities have not been recognised was US$21,867,000 (2023 US$21,370,000). No liability
has been recognised in respect of these differences because the reversal would not give rise to an additional tax liability.
85
Key estimate
At the balance-sheet date, the Group had unused tax losses of US$36,662,000 (2023 US$49,935,000) available for
offset against future profits. The directors have reviewed estimates of future profits and a deferred-tax asset has been
recognised in respect of US$7,623,000 (2023 US$16,618,000) of such losses. No deferred-tax asset has been recognised in
respect of the remaining US$29,039,000 (2023 US$33,317,000) due to the unpredictability of future profit streams. These
losses have no expiry date. In the normal course of business, both in the UK and Indonesia, the Group has a number of
matters under discussion with local tax authorities. The Group is satisfied, based on external tax advice, that appropriate
tax treatments have been applied. The likely impact of any change in treatment would be to restrict the availability of the
Group’s unused tax losses.
The directors have considered the sensitivity of the deferred-tax asset recognised in respect of losses to changes in
estimated future profits, particularly with regard to changes in the price of CPO. If CPO prices were to fall by 10% from
those initially estimated, there would be no impact on the deferred-tax asset.
At the balance-sheet date, the aggregate amount of temporary differences associated with outstanding executive share
options for which deferred-tax assets have not been recognised was US$1,903,000 (2023 US$868,000). No asset has been
recognised in respect of these differences due to the unpredictability of parent-Company future profit streams.
24 Retirement-benefit obligations
The Group’s only obligation relates to an unfunded, non-contributory, post-employment statutory benefit scheme in Indonesia.
A lump sum is paid to employees on retirement or on leaving the Group’s employment. This terminal benefit is accrued by the
Group based on an annual actuarial review and charged in the income statement on the basis of individuals’ service at the
balance-sheet date. Retirement is assumed at the age of 55 years. Standard Indonesian mortality assumptions are used, and
no allowance is made for internal promotion. A range of different discount rates are used for each of the Indonesian subsidiary
companies, based on actuarial advice.
2024
%
2023
%
The main assumptions used to assess the Group’s liabilities are:
Discount rate
6.75-7.00
6.75-7.00
Salary increase per annum
7.00
7.00
2024
US$’000
2023
US$’000
Reconciliation of scheme liabilities:
Current-service cost
2,270
1,770
Past-service cost
114
203
Interest cost
790
705
Actuarial (gain)/loss
(877)
469
2,297
3,147
Less: Benefits paid out
(1,013)
(776)
Movement in the year
1,284
2,371
At 1 January
12,429
9,972
Exchange differences
(572)
86
At 31 December
13,141
12,429
The weighted average duration of the scheme liabilities at 31 December 2024 was 9.8 years (2023 - 10.0 years).
Key estimate
The main assumptions used to assess the Group’s liabilities are shown in the table above. Changing one of them by 1% in
either direction would have the effect of increasing or decreasing the Group’s liabilities by US$1.1-1.2 million.
Notes to the consolidated accounts continued
23 Deferred tax (continued)
86
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
25 Share capital
Authorised
number
Allotted,
fully paid
and voting
number
Authorised
£’000
Allotted,
fully paid
and voting
US$’000
At 1 January 2024
87,000,000
53,289,690
8,700
9,062
Issued
—
70,000
—
9
Redeemed
—
(1,183,398)
—
(149)
At 31 December 2024
87,000,000
52,176,292
8,700
8,922
At 1 January 2023
87,000,000
54,230,888
8,700
9,179
Issued
—
50,000
—
6
Redeemed
—
(991,198)
—
(123)
At 31 December 2024
87,000,000
53,289,690
8,700
9,062
During the year, in anticipation of the exercise of share options, the Company issued 70,000 10p shares for US$9,000 cash
consideration. Certain share options were exercised in the year giving rise to the share premium shown in note 27.
The Company continued its share-buyback programme during the year. Under the programme the Company bought back and
cancelled 1,183,398 10p shares, representing 2.2% of the issued share capital, for a total cost of US$13.4 million. In 2023, under
that programme the company bought back and cancelled 991,198 10p shares, representing 1.8% of the issued share capital, for a
total cost of US$9.7 million.
26 Share-based payments
The Group has equity-settled share-option schemes in place for directors and selected employees of the Group. Under the
scheme established in 2012, options are exercisable at a price equal to the quoted market price of the Company’s shares on the
date of grant. Under the Group’s long-term incentive scheme established in 2017, options are exercisable at nil cost. For both
schemes, the vesting period is three years and if the options remain unexercised after a period of ten years from the date of grant,
the options lapse. Options may be forfeited if the employee leaves the Group before the options vest. Details of the share options
outstanding during the year are as follows:
2024
Number
of share
options
2024
Weighted-
average
exercise price
(pence)
2023
Number
of share
options
2023
Weighted-
average
exercise price
(pence)
At 1 January
233,248
35.4
183,934
44.9
Granted during the year
95,712
0.0
91,521
0.0
Exercised during the year
(67,949)
121.4
(42,207)
0.0
At 31 December
261,011
0.0
233,248
35.4
Exercisable at the end of the year
13,748
0.0
32,299
255.4
The weighted-average share price at the date of exercise for share options exercised during the year was 875p. The options
outstanding at 31 December 2024 had a weighted-average remaining contractual life of 8.5 years and exercise price of 0p.
The Group recognised total expenses of US$676,000 related to equity-settled share-based payments (2023 US$554,000), with
options granted in the year valued using a Black-Scholes pricing model based on exercise after three years, share volatility over
the last year of 38%, assumed dividends of 3-6%, and a risk-free rate of approximately 3%. The fair value of options granted in
the year was between 613p and 824p. Details of the directors’ share options are set out in the directors’ remuneration report on
pages 54 to 57.
87
27 Reserves
Share-
premium
account
US$’000
Revalu-
ation
Reserve
US$’000
Capital-
redemp
tion
reserve
US$’000
Merger
reserve
US$’000
Treasury
shares
US$’000
Share-
option
reserve
US$’000
Share of
asso-
ciates’
reserves
US$’000
Foreign-
exchange
reserve
US$’000
Total
US$’000
Retained
earnings
US$’000
At 1 January
2024
32,579
535
4,481
766
(10)
1,235
13,618
59
53,263
422,748
Profit for the
financial year
—
—
—
—
—
—
2,355
—
2,355
85,496
Exchange
differences
—
3
—
—
1
—
339
(107)
236
258
Retirement-
benefit
obligations
—
—
—
—
—
—
—
—
—
675
Issue of shares
104
—
—
—
(6)
—
—
—
98
—
Dividends paid
—
—
—
—
—
—
—
—
—
(32,339)
Dividends from
associates
—
—
—
—
—
—
(2,425)
—
(2,425)
2,425
Share-based
payments
—
—
—
—
5
206
—
—
211
465
Share buybacks
—
—
149
—
—
—
—
—
149
(13,367)
Acquisition of
non-controlling
interest
—
—
—
—
—
—
—
—
—
(3,423)
At 31 December
2024
32,683
538
4,630
766
(10)
1,441
13,887
(48)
53,887
462,938
At 1 January
2023
32,579
540
4,358
766
(2)
941
15,277
84
54,543
407,460
Profit for the
financial year
—
—
—
—
—
—
2,390
—
2,390
50,097
Exchange
differences
—
(5)
—
—
(2)
—
(483)
(25)
(515)
(425)
Retirement-
benefit
obligations
—
—
—
—
—
—
—
—
—
(344)
Issue of shares
—
—
—
—
(6)
—
—
—
(6)
—
Dividends paid
—
—
—
—
—
—
—
—
—
(28,188)
Dividends from
associates
—
—
—
—
—
—
(3,566)
—
(3,566)
3,566
Share-based
payments
—
—
—
—
—
294
—
—
294
260
Share buybacks
—
—
123
—
—
—
—
—
123
(9,678)
At 31 December
2023
32,579
535
4,481
766
(10)
1,235
13,618
59
53,263
422,748
The nature and purpose of each reserve is described by its title shown in the table above.
Notes to the consolidated accounts continued
88
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
28 Non-controlling interests
2024
US$’000
2023
US$’000
At 1 January
20,000
17,662
Share of profit in the year
2,781
3,911
Dividends paid
(4,450)
(1,551)
Acquisition of non-controlling interest
(10,618)
—
Share of retirement benefit credited/(charged) to other comprehensive income
9
(22)
At 31 December
7,722
20,000
Following the acquisition of the 5% minority holding in the majority (70% by Group-owned planted hectarage) of its Indonesian
subsidiary trading companies during the year, the Group has one minority partner at one of its plantation operations. The minority
share of profit for the year and Group equity, allocated by operation, is shown in the following table:
2024
Profit
US$’000
2024
Equity
US$’000
2023
Profit
US$’000
2023
Equity
US$’000
Kota Bangun
459
—
817
4,178
Bangka
1,758
7,722
1,351
9,198
Pangkatan group
98
—
817
3,256
Bumi Mas
209
—
410
3,499
Musi Rawas
239
—
388
212
Simpang Kiri
18
—
128
(343)
2,781
7,722
3,911
20,000
29 Note to the consolidated cash-flow statement
2024
US$’000
*2023
US$’000
Operating profit
115,695
75,296
Biological gain
(1,847)
(551)
Loss on disposal of property, plant and equipment
523
259
Release of deferred profit
(100)
(92)
Depreciation of property, plant and equipment
26,491
24,102
Amortisation of intangible assets
184
180
Retirement-benefit obligations
2,161
905
Share-based payments
676
554
Operating cash flows before movements in working capital
143,783
100,653
Decrease in inventories
1,367
1,023
(Increase)/decrease in receivables
(1,296)
11,814
Decrease in payables
(910)
(4,991)
Decrease/(increase) in trading balances with smallholder co-operatives
9,694
(5,437)
Cash generated by operating activities
152,638
103,062
Dividends from associated companies
2,425
3,566
Income tax paid
(15,822)
(23,144)
Interest paid
(3,441)
(3,810)
Net cash generated by operating activities
135,800
79,674
89
30 Analysis of movements in net funds/(debt)
Cash and
cash
equivalents
US$’000
Current-asset
investments
US$’000
Borrowings
due within
one year
US$’000
Borrowings
due after
one year
US$’000
Total
US$’000
At 1 January 2024
39,324
270
(21,009)
(33,413)
(14,828)
Net increase in cash and cash
equivalents
41,219
(44)
—
—
41,175
New borrowings
—
—
(637)
—
(637)
Repayment of borrowings
—
—
21,145
—
21,145
Reclassification
—
—
(12,467)
12,467
—
Foreign-exchange movements
(1,320)
(12)
15
872
(445)
At 31 December 2024
79,223
214
(12,953)
(20,074)
46,410
At 1 January 2023
82,503
—
(17,364)
(31,675)
33,464
Net decrease in cash and cash
equivalents
(43,437)
—
—
—
(43,437)
New borrowings
—
266
(267)
(22,221)
(22,222)
Repayment of borrowings
—
—
17,405
—
17,405
Reclassification
—
—
(20,780)
20,780
—
Foreign-exchange movements
258
4
(3)
(297)
(38)
At 31 December 2023
39,324
270
(21,009)
(33,413)
(14,828)
31 Financial instruments
Capital-risk management
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximising
returns to shareholders. The capital structure of the Group consists of debt (see note 22), cash and cash equivalents, current-
asset investments and equity attributable to the owners of the parent Company, comprising issued capital, reserves and retained
earnings. The Group is not subject to any externally-imposed capital requirements.
The Group’s board continues to monitor the capital structure based on the funding requirements of the Group. At the balance-
sheet date the Group had net funds, see note 30, of US$46,410,000 (2023 - net debt US$14,828,000) and equity attributable to the
owners of the parent Company of US$525,747,000 (2023 US$485,073,000). The board intends to fund its continuing Indonesian
expansion and maximise returns to shareholders by a combination of the Group’s cash and other liquid resources, debt finance,
and considering the sale of further non-core assets where appropriate.
Categories of financial instruments
All of the Group’s financial assets (other than cash and other liquid resources) are classified as held at amortised cost, with the
exception of its other investments shown in note 16, which are classified as financial assets at fair value through profit or loss.
All of the Group’s financial liabilities are measured at amortised cost. In the opinion of the directors, there was no significant
difference between the carrying values and estimated fair values of the Group’s primary financial assets and liabilities at either
the current, or preceding, financial year end.
Financial-risk management objectives
The majority of the Group’s main risks arising from the Group’s financial instruments are foreign-currency, interest-rate, credit and
liquidity. The board reviews and agrees the policies for managing these risks. The policies and the impact of these risks on the
Group’s balance sheet at the end of the financial year are summarised below.
Foreign-currency risk
The majority of the Group’s operations are undertaken in Indonesia. The Group does not have significant transactional currency
exposures arising from sales or purchases by its operating units, but the Group’s balance sheet can be significantly affected by
movements in exchange rates. Whilst the Group’s trading takes place in local currencies in South East Asia, relevant commodity
prices are determined in US Dollars in a world market which reduces the Group’s currency risk. The Group makes limited use of
forward-currency contracts; there were no contracts open at 31 December 2024.
Notes to the consolidated accounts continued
90
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
31 Financial instruments continued
The currency profile of the Group’s monetary assets, excluding trade and other receivables (the currency profile of which is given
in note 19), are as follows:
2024
US$’000
2023
US$’000
US Dollar
13,457
25,770
Indonesian Rupiah
61,696
13,385
Sterling
4,184
342
Malaysian Ringgit
100
97
79,437
39,594
The currency profile of the Group’s monetary liabilities, excluding trade and other payables, is shown in note 19.
The Group is exposed to changes in foreign-currency exchange rates. This is in relation to the impact of movements on its non-US
Dollar monetary assets and in relation to the consolidation of its non-US Dollar-functional-currency subsidiary and associated
undertakings. The most significant sensitivity arises in respect of movements in the Indonesian Rupiah. Management estimates
that a 10% weakening of the US Dollar against the Indonesian Rupiah would result in a fall in profit for the year and net assets of
US$6.0 million (2023 US$2.2 million).
Interest-rate risk
In order to optimise the income received on its cash deposits, the Group continuously reviews the terms of these deposits to take
advantage of the best market rates. UK funds are passed to banks who have a credit rating of at least A minus. The Group’s only
financial liabilities other than short-term trade and other payables are the borrowings referred to in note 22. Group borrowings
are at variable rates of interest linked to SOFR and the Bank of Indonesia base rate, and so are exposed to changes in underlying
interest rates. Based on current borrowing, management estimates that for every 1% decrease or increase in interest rates, Group
profit for the year and net assets would increase or decrease by US$0.3 million (2023 US$0.4 million).
Credit risk
The Group’s credit risk on cash deposits is described above. Regarding trade receivables, the Group performs a credit evaluation
before extending credit to customers. The Group does not have any significant concentrations of credit risk (defined by
management as more than 10% of gross-monetary assets), other than in relation to bank deposits which management seeks to
mitigate through the use of banks with high-credit ratings, and loans extended to the smallholder-co-operative schemes attached
to the Group’s new projects. The Group’s maximum exposure to credit risk is represented by the carrying amount of financial
assets in the financial statements.
Liquidity risk
The Group manages liquidity risk by maintaining adequate cash reserves and banking facilities, and through actively monitoring
the Group’s forecast and actual cash flows. All of the Group’s monetary financial assets and liabilities have a maturity profile of
less than ten years. The maturity profile for financial liabilities is shown in note 22.
32 Related-party transactions
Remuneration of key management personnel
The remuneration of the directors, who are the key management personnel of the Group, is set out in the directors’ remuneration
report on page 55. The directors’ participation in the executive share-option schemes and long-term incentive scheme is disclosed
on pages 54 to 57.
The Group received dividends from its associated companies during the year. These are set out in note 15.
The Group continued to make finance available to one of its minority partners during the year, until this minority partner sold his
interest to the Group in May 2024. This is set out in note 19.
During the year, the Group made sales of US$30.1 million (2023 - US$4.2 million) to subsidiaries of Kuala Lumpur Kepong Berhad,
a significant shareholder in the Group (see page 43), on normal commercial terms.
FINANCIAL STATEMENTS
NOTES TO THE CONSOLIDATED ACCOUNTS
91
Parent-company balance sheet
Company number: 1555042
As at 31 December 2024
Note
2024
US$’000
2023
US$’000
Non-current assets
Property, plant and equipment
iv
885
885
Investments in subsidiaries
v
15,799
15,799
Trade and other receivables
vi
87,449
89,842
104,133
106,526
Current assets
Trade and other receivables
vi
987
1,240
Cash and cash equivalents
5,420
1,520
6,407
2,760
Total assets
110,540
109,286
Current liabilities
Trade and other payables
vii
1,060
845
Net current assets
5,347
1,915
Total liabilities
1,060
845
Net assets
109,480
108,441
Equity
Share capital
viii
8,922
9,062
Other reserves
ix
39,987
39,528
Retained earnings
ix
60,571
59,851
Total equity
109,480
108,441
The Company recorded a profit for the year of US$45,961,000 (2023 - US$46,102,000).
The financial statements on pages 92 to 97 were approved by the board of directors on 25 March 2025 and signed on its
behalf by
Peter Hadsley-Chaplin
Matthew Coulson
Chairman
Chief executive
92
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
Share
capital
US$’000
Other
reserves
US$’000
Retained
earnings
US$’000
Total
US$’000
Profit for the year
—
—
45,961
45,961
Other comprehensive income for the year
—
1
—
1
Total comprehensive income for the year
—
1
45,961
45,962
Issue of share capital
9
98
—
107
Dividends
—
—
(32,339)
(32,339)
Share buyback
(149)
149
(13,367)
(13,367)
Credit to equity for equity-settled
share-based payments
—
211
465
676
Transactions with owners
(140)
458
(45,241)
(44,923)
At 1 January 2024
9,062
39,528
59,851
108,441
At 31 December 2024
8,922
39,987
60,571
109,480
Profit for the year
—
—
46,102
46,102
Other comprehensive expense for the year
—
(2)
—
(2)
Total comprehensive income for the year
—
(2)
46,102
46,100
Issue of share capital
6
(6)
—
—
Dividends
—
—
(28,188)
(28,188)
Share buyback
(123)
123
(9,678)
(9,678)
Credit to equity for equity-settled
share-based payments
—
294
260
554
Transactions with owners
(117)
411
(37,606)
(37,312)
At 1 January 2023
9,179
39,119
51,355
99,653
At 31 December 2023
9,062
39,528
59,851
108,441
Parent-company statement of changes in equity
For the year ended 31 December 2024
PARENT-COMPANY
FINANCIAL STATEMENTS
93
i Significant accounting policies
Basis of accounting
M.P. Evans Group PLC is a public limited company incorporated in the United Kingdom and registered in England and Wales, and
the address of its registered office is given on page 104. The Group’s principal activities are shown in the strategic report on page
12. The financial statements of the Company are presented as required by the Companies Act 2006. The financial statements have
been prepared in accordance with Financial Reporting Standard 101, ‘Reduced Disclosure Framework’ (“FRS 101”). The financial
statements have been prepared on a going-concern basis under the historical-cost convention, in accordance with applicable
accounting standards in the United Kingdom. The Company is domiciled in the UK.
The principal accounting policies have been consistently applied and are summarised below. The directors have concluded
that the functional currency is the US Dollar, reflecting the primary economic environment in which the Company operates. The
presentational currency for the Company accounts is also the US Dollar.
As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available under that standard in relation
to share-based payment, financial instruments, capital management, presentation of comparative information in relation to
certain assets, and certain related party transactions.
Pursuant to Section 408 of the Companies Act 2006, the Company’s own income statement and statement of other comprehensive
income are not presented separately in the Company financial statements, but they have been approved by the board.
The Company has assessed the impact of new and revised accounting standards as described in note 2 to the consolidated
financial statements, and has concluded that none have a material impact on the Company’s results or financial position.
Going concern
The financial statements have been prepared on a going-concern basis. The directors have conducted a review of projected cash
flows, concluding that the Company has sufficient projected funds to continue its business in the medium term. Further details are
given in the report of the directors on page 44.
Cash-flow statement
The Company has not included a cash-flow statement as part of its financial statements since the consolidated financial
statements of the Group, of which the Company is a member, include a cash-flow statement and are publicly available.
Property, plant and equipment
Property, plant and equipment are stated at the historic purchase cost less accumulated depreciation. Plant, equipment and
vehicles are depreciated over their estimated useful lives at 25%. Estimated useful lives are reviewed at each balance-sheet date.
Where the board judges the residual value of an asset to exceed its carrying value, no provision is made for depreciation.
Investments in subsidiaries
Investments in subsidiaries are shown at cost less provision for impairment.
Trade and other receivables
These represent amounts due from Group companies in the normal course of business, are repayable on demand, unsecured and
are not interest-bearing. These are measured at amortised cost, reduced by appropriate allowances for expected credit losses.
Balances are classified as non-current if they are not expected to be recovered in less than one year.
Cash and cash-equivalents
These include cash in hand and deposits held with banks with original maturities of three months or less.
Trade and other payables
Trade and other payables are initially measured at fair value, and are subsequently measured at amortised cost. Borrowings are
recorded at the proceeds received, net of direct issue costs.
Critical accounting judgements and key sources of estimation uncertainty
The critical judgements and accounting estimates relevant to the consolidated financial statements are shown in note 3 to the
consolidated financial statements on page 73. The directors have concluded that there are no critical judgements and accounting
estimates in the preparation of the parent-Company accounts.
Notes to the parent-company accounts
For the year ended 31 December 2024
94
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
PARENT-COMPANY
NOTES TO THE PARENT-COMPANY ACCOUNTS
ii Result for the year
As permitted by section 408 of the Companies Act 2006, the Company has elected not to present its own profit and loss account
for the year. M.P. Evans Group PLC reported a profit for the year ended 31 December 2024 of US$45,961,000 (2023 - US$46,102,000).
The Company’s main source of income is dividends from subsidiary companies.
The auditors’ remuneration for audit services was US$38,000 (2023 US$36,000).
iii Employees
2024
US$’000
2023
US$’000
Employee costs during the year
Wages and salaries
2,243
2,035
Social security costs
299
269
Pension costs
81
73
Share-based payments
340
241
2,963
2,618
As recorded in the directors’ remuneration report on page 55, wages and salary costs include bonuses paid to the directors in
respect of 2024 and 2023.
2024
number
2023
number
Average monthly number of people employed
Staff
4
5
Directors
3
2
7
7
iv Property, plant and equipment
Land and
buildings
US$’000
Plant,
equipment
& vehicles
US$’000
Total
US$’000
Cost
At 1 January 2024
834
182
1,016
Additions
—
20
20
At 31 December 2024
834
202
1,036
Accumulated depreciation
At 1 January 2024
—
131
131
Charge for the year
—
20
20
At 31 December 2024
—
151
151
Net book value at 31 December 2024
834
51
885
Net book value at 31 December 2023
834
51
885
95
v
Investments in subsidiaries
US$’000
Subsidiary undertakings
At 1 January and 31 December 2024
15,799
The following companies are the principal direct subsidiary companies of M.P. Evans Group PLC:
Country of
operation
Holding
%
M.P. Evans & Co. Limited
UK
100
Sungkai Holdings Limited
UK
100
Holdings are all of ordinary shares. The directors believe the carrying value of investments is supported by their underlying net
assets. Details of all subsidiary companies are shown on page 98.
vi Trade and other receivables
2024
US$’000
2023
US$’000
Current assets
Other debtors
932
1,185
Prepayments and accrued income
55
55
987
1,240
Non-current assets
Amounts owed by subsidiary undertakings
87,449
89,842
vii Trade and other payables
2024
US$’000
2023
US$’000
Other creditors
1,060
845
viii Share capital
See note 25 to the consolidated financial statements.
Notes to the parent-company accounts continued
96
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
PARENT-COMPANY
NOTES TO THE PARENT-COMPANY ACCOUNTS
ix Reserves
Share-
premium
account
US$’000
Capital-
redemption
reserve
US$’000
Merger
reserve
US$’000
Treasury
shares
US$’000
Other
reserves
US$’000
Total
US$’000
Retained
earnings
US$’000
At 1 January 2024
32,579
4,290
1,434
(10)
1,235
39,528
59,851
Issue of shares
104
—
—
(6)
—
98
—
Share-based payments
—
—
—
5
206
211
465
Share buyback
—
149
—
—
—
149
(13,367)
Profit for the year
—
—
—
—
—
—
45,961
Dividends*
—
—
—
—
—
—
(32,339)
Exchange differences
—
—
—
1
1
—
At 31 December 2024
32,683
4,439
1,434
(10)
1,441
39,987
60,571
At 1 January 2023
32,579
4,167
1,434
(2)
941
39,119
51,355
Issue of shares
—
—
—
(6)
—
(6)
—
Share-based payments
—
—
—
—
294
294
260
Share buyback
—
123
—
—
—
123
(9,678)
Profit for the year
—
—
—
—
—
—
46,102
Dividends*
—
—
—
—
—
—
(28,188)
Exchange differences
—
—
—
(2)
—
(2)
—
At 31 December 2023
32,579
4,290
1,434
(10)
1,235
39,528
59,851
* See note 10 to the consolidated financial statements.
97
Subsidiary and associated undertakings
As at 31 December 2024
SUBSIDIARY UNDERTAKINGS
Details of the Group’s subsidiary undertakings as at 31 December 2024 are as follows:
Name of subsidiary
% of
shares
held
Country of
incorporation
Country of
operation
Field of activity
PT Prima Mitrajaya Mandiri
100
Indonesia
Indonesia
Production at Kota Bangun
PT Teguh Jayaprima Abadi
100
Indonesia
Indonesia
Production at Kota Bangun
PT Agro Bumi Kaltim
100
Indonesia
Indonesia
Production at Kota Bangun
PT Nusantara Agro Sentosa
100
Indonesia
Indonesia
Production at Kota Bangun
PT Gunung Pelawan Lestari
90
Indonesia
Indonesia
Production at Bangka
PT Pangkatan Indonesia
100
Indonesia
Indonesia
Production at Pangkatan
PT Bilah Plantindo
100
Indonesia
Indonesia
Production at Pangkatan
PT Sembada Sennah Maju
100
Indonesia
Indonesia
Production at Pangkatan
PT Bumi Mas Agro
100
Indonesia
Indonesia
Production at Bumi Mas
PT Evans Lestari
100
Indonesia
Indonesia
Production at Musi Rawas
PT Simpang Kiri
Plantation Indonesia
100
Indonesia
Indonesia
Production at Simpang Kiri
PT Dharma Agung
100
Indonesia
Indonesia
Production at Simpang Kiri
PT Teunggulon Raya
100
Indonesia
Indonesia
Production at Simpang Kiri
PT Perusahaan Pertanian Perkebunan
Perindustrian dan Perdagangan Surya Makmur
100
Indonesia
Indonesia
Holding company
PT Aceh Timur Indonesia
100
Indonesia
Indonesia
Holding company
PT Evans Indonesia
100
Indonesia
Indonesia
Provision of agronomic and
management consultancy services
Sunrich Plantations Pte Ltd
100
Singapore
Singapore
Holding company
Bertam Consolidated Rubber Company
Limited
100
England and Wales Malaysia
Holding company
M.P. Evans & Co. Limited*
100
England and Wales United Kingdom
Holding company
Sungkai Holdings Limited*
100
England and Wales United Kingdom
Holding company
The shareholdings in the above companies represent ordinary shares. Other than the companies marked *, all shareholdings are
held indirectly.
The registered offices for all Indonesian companies is Graha Aktiva, Suite 1001, Jl HR Rasuna Said Blok X-1 Kav 03, Jakarta 12950
Indonesia, for Sunrich Plantations Pte Ltd is 25 North Bridge Road, Level 7 Singapore 179104, and for all UK companies is the Group’s
registered office as shown on page 104.
ASSOCIATED UNDERTAKINGS
Details of the associated undertakings as at 31 December 2024 are as follows:
Unlisted
Issued
fully-paid
share capital
%
held
Country of
incorporation
Country of
operation
Field of activity
PT Kerasaan Indonesia
Rp 138.07m
38
Indonesia
Indonesia
Production of CPO and PK
Bertam Properties Sdn. Berhad.
RM 60.00m
40
Malaysia
Malaysia
Property development
The registered office of PT Kerasaan Indonesia is Gedung Forum Nine Building, 10th Floor, Suite 1-11, Jl. Imam Bonjol No.9, Medan-20112,
North Sumatra, Indonesia and the registered office of Bertam Properties Sdn. Berhad is 1st Floor, Standard Chartered Bank Chambers,
Lebuh Pantai, 10300 Pulau Pinang, Malaysia.
98
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
The information on pages 99 to 104 does not form part of the audited financial statements.
PLANTED HECTARAGE
Group
Scheme smallholders
Ownership
%
Mature
Ha
Immature
Ha
Total1
Ha
Mature
Ha
Immature
Ha
Total2
Ha
Subsidiaries — oil palm
Kota Bangun
100
15,138
1,954
17,092
6,272
63
6,335
Bangka
90
6,151
-
6,151
3,881
-
3,881
Pangkatan group
100
6,427
539
6,966
648
706
1,354
Bumi Mas
100
7,426
66
7,492
1,351
87
1,438
Musi Rawas
100
5,537
2,330
7,867
2,537
436
2,973
Simpang Kiri
100
3,202
1,075
4,277
61
193
254
Total
43,881
5,964
49,845
14,750
1,485
16,235
Group share of subsidiaries’ land
43,266
5,964
49,230
Associates — oil palm
Kerasaan
1,661
661
2,322
Group share of associates’ land
38
631
251
882
Memorandum:
Group share of subsidiaries’ land and
share of associates’ land
43,897
6,215
50,112
Subsidiaries’ land and Group share of
associates’ land
44,512
6,215
50,727
Notes
1. The Group works to obtain final land licences (HGUs) as soon as possible for its planted areas. The only areas for which the Group is
still working to obtain HGUs is in relation to some of the newer planting at Musi Rawas (approximately 2,000ha) and at Kota Bangun
(approximately 1,000ha, some of which relates to the additional land acquired during 2023).
2. The Group supports its associated scheme smallholders to obtain HGUs. In total, smallholder HGUs are in the process of being
obtained for approximately 4,000ha, some of which relates to newer planting or areas brought into Group association more recently.
Analysis of Indonesian plantation land areas
As at 31 December 2024
OTHER INFORMATION
99
The information in the following table provides a directors’ estimate of the Group equity value at 31 December 2024
utilising, except where indicated, an independent valuation of the Group’s properties performed at the end of 2024.
Planted area
Ha
Market value per
planted hectare2
US$
Market value
attributable to Group1
US$’000
INDONESIAN OIL PALM PLANTATIONS
Group
Kota Bangun
17,092
16,840
287,800
Bumi Mas
7,492
22,064
165,300
Bangka
6,151
20,940
115,900
Musi Rawas
7,867
21,762
171,200
Pangkatan group
6,966
18,390
128,100
Simpang Kiri
4,277
12,181
52,100
49,845
18,465
920,400
Smallholders
Kota Bangun
6,335
5,383
34,100
Bumi Mas
1,438
6,398
9,200
Bangka
3,881
5,694
19,900
Musi Rawas
2,973
8,075
24,000
Pangkatan group
1,354
5,687
7,700
Simpang Kiri
254
3,937
1,000
16,235
5,907
95,900
Associates
Kerasaan3
2,322
14,300
12,600
Total Indonesia
1,028,900
MALAYSIAN PROPERTY
Bertam Properties
n/a
n/a
47,400
Total Malaysia
47,400
Net cash4
46,149
Other assets and liabilities5
(21,739)
Total equity value
1,100,710
Equity value (£ per share6)
16.88
Notes
1. The Group owns 100% of its Indonesian plantations, except at Bangka, where there is a minority partner who owns 10%.
2. The market value per planted hectare stated is the independent valuation of the Group’s estates, and where appropriate, related
palm-oil mills. However, for Kota Bangun and Simpang Kiri, the market value per planted hectare reflects a blended average between
the independent valuation and the cost of the acquisitions made during 2023. No amount has been included in the Group equity
valuation at 31 December 2024 for the smallholder hectares related to these acquisitions.
3. The Group’s only oil-palm associate, Kerasaan, where the Group owns 38%, was not included in the independent valuation at
31 December 2024. The value in the table above has been carried forward from the independent valuation performed at
31 December 2019.
4. Net cash is taken as cash and other liquid resources less borrowings from the 31 December 2024 balance sheet, attributable to the
owners of M.P. Evans Group PLC.
5. Other assets and liabilities are taken as net assets minus plantation and property-related assets, minus net cash from the
31 December 2024 balance sheet, attributable to the owners of M.P. Evans Group PLC.
6. Amount per share is calculated using the year-end exchange rate and year-end shares in issue (see note 25).
Analysis of Group equity value
As at 31 December 2024
100
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
2024
Tonnes
2023
Tonnes
2022
Tonnes
2021
Tonnes
2020
Tonnes
Production
Crude palm oil
372,200
378,500
341,700
312,900
271,700
Palm kernels
81,300
80,600
73,800
67,100
60,400
Crops
Oil-palm fresh fruit bunches
Own crops
937,000
922,900
905,400
809,700
724,300
Scheme-smallholder crops
285,900
278,500
265,700
229,300
193,000
Independent crop purchased
386,000
421,500
340,600
327,200
289,700
1,608,900
1,622,900
1,511,700
1,366,200
1,207,000
Indonesian associated-company estates
45,900
48,200
51,900
55,200
54,800
US$
US$
US$
US$
US$
Average sale prices
Crude palm oil — cif Rotterdam per tonne
1,084
964
1,345
1,195
716
Crude palm oil — ex-mill-gate per tonne
823
729
854
810
591
Exchange rates
US$1 = Indonesian Rupiah
— average
15,855
15,236
14,853
14,295
14,541
— year end
16,095
15,397
15,568
14,253
14,050
US$1 = Malaysian Ringgit
— average
4.57
4.56
4.40
4.14
4.20
— year end
4.47
4.60
4.41
4.17
4.02
£1 = US Dollar
— average
1.28
1.25
1.24
1.37
1.28
— year end
1.25
1.27
1.20
1.35
1.37
US$’000
US$’000
US$’000
US$’000
US$’000
Revenue
352,839
307,368
326,917
276,592
174,510
Gross profit
116,590
78,453
109,210
103,613
34,755
Profit before tax
113,490
72,834
100,250
112,502
28,440
US cents
US cents
US cents
US cents
US cents
Basic continuing earnings per share
165.9
97.6
133.9
158.4
37.4
Pence
Pence
Pence
Pence
Pence
Basic continuing earnings per share
129.6
78.1
108.0
115.6
29.2
Dividends per share:
Normal
52.5
45.0
42.5
35.0
22.0
Special
—
—
—
5.0
—
Total
52.5
45.0
42.5
40.0
22.0
US$’000
US$’000
US$’000
US$’000
US$’000
Equity attributable to the owners of
M.P. Evans Group PLC
525,747
485,073
471,182
431,524
364,111
Net cash generated by operating activities
135,800
79,674
102,288
92,272
39,598
Five-year summary
OTHER INFORMATION
101
NOTICE IS HEREBY GIVEN that the annual general meeting of M.P. Evans Group PLC will be held at Tallow Chandlers’ Hall,
4 Dowgate Hill, London, EC4R 2SH on Friday 13 June 2025 at 12 noon. The Company also aims to make the proceedings
available to view online. Further details, where necessary, will be provided in advance of the meeting on the Company’s
AGM website page (www.mpevans.co.uk/investors/agm).
The meeting will be for the following purposes, and unless a poll is validly demanded, voting will be decided on a show
of hands:
AS ORDINARY BUSINESS
Resolution on
form of proxy
1
To receive and consider the report of the directors and the audited consolidated financial statements
for the year ended 31 December 2024.
No 1
2
To receive and consider the directors’ remuneration report as set out in the annual report and accounts
for the financial year ended 31 December 2024.
No 2
3
To re-elect K Chandra Sekaran as a director.
No 3
4
To re-elect Peter Hadsley-Chaplin as a director.
No 4
5
To declare a final dividend.
No 5
6
To appoint BDO LLP as auditors and to authorise the directors to determine their remuneration.
No 6
AS SPECIAL BUSINESS
To consider and, if thought fit, pass the following resolution, as a special resolution:
Resolution on
form of proxy
7
That the Company is hereby generally and unconditionally authorised to make market purchases
(within the meaning of section 693 of the Companies Act 2006) of shares of 10p each in the capital of
the Company provided that:
a) the maximum number of shares hereby authorised to be purchased is 5,217,629;
b) the minimum price which may be paid for each share is 10p (exclusive of expenses);
c) the maximum price (exclusive of expenses) which may be paid for each share is the higher of:
i. an amount equal to 105% of the average of the middle-market quotations for such shares as
derived from the Daily Official List of the London Stock Exchange for the five business days
immediately preceding the day of purchase;
ii. the higher of the price of the last independent trade of a 10p share and the highest current
independent bid for a 10p share of the trading venue where the purchase is carried out; and
d) the authority hereby conferred shall expire at the conclusion of the next annual general meeting of
the Company or on 30 June 2026, whichever shall be the earlier 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.
No 7
By order of the board
Katya Merrick
Company secretary
25 March 2025
Notice of meeting
102
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
NOTES
1) A member of the Company entitled to attend, speak and vote
at the meeting convened by this notice may appoint a proxy
to exercise all or any of his or her rights to attend, speak and
vote at the meeting on his or her behalf. A proxy need not be
a member of the Company. Appointment of a proxy will not
subsequently preclude a member from attending and voting
at the meeting in person if he or she so wishes. A member
may appoint more than one proxy provided that each proxy is
appointed to exercise the rights attached to different shares
held by the member. The form of proxy contains instructions
on how to appoint more than one proxy.
2) A form of proxy for use at the meeting is enclosed. Please
return the form of proxy or other instrument appointing a
proxy as soon as possible. To be valid, it must be received
by post or (during normal business hours only) by hand at
the office of the registrars, Computershare Investor Services
PLC, at The Pavilions, Bridgwater Road, Bristol, BS99 6ZZ,
no later than 12pm on 11 June 2025 (or, if the meeting is
adjourned, no later than 48 hours before the time for holding
the adjourned meeting, or, if a poll is taken otherwise than at
or on the same day as the meeting at which it is demanded,
no later than 24 hours before the time appointed for the
taking of the poll). Alternatively, you may appoint a proxy
electronically.
If you wish to submit your form of proxy via the internet,
you will need your Control Number, Shareholder Reference
Number (“SRN”) and Personal Identification Number (“PIN”)
which are printed on the Form of Proxy. To appoint a proxy via
the internet you should log on to the Computershare website
at www.investorcentre.co.uk/eproxy. You will be asked to agree
to the terms and conditions for electronic proxy appointment.
It is important that you read these terms and conditions as
they set out the basis on which proxy appointment via the
internet shall take place. This electronic address is provided
only for the purpose of communications relating to electronic
appointment of proxies.
CREST members wishing to appoint a proxy or proxies through
the CREST electronic proxy appointment service, should refer
to the form of proxy and more detailed instructions posted
on the AGM page of the Group’s website (www.mpevans.co.uk/
investors/agm).
3) The right to appoint a proxy does not apply to persons whose
shares are held on their behalf by another person and who
have been nominated to receive communications from the
Company in accordance with section 146 of the Companies
Act 2006 (“nominated persons”). Nominated persons
may have a right under an agreement with the registered
shareholder who holds the shares on their behalf to be
OTHER INFORMATION
appointed (or to have someone else appointed) as a proxy.
Alternatively, if nominated persons do not have such a right,
or do not wish to exercise it, they may have a right under such
an agreement to give instructions to the person holding the
shares as to the exercise of voting rights.
4) Pursuant to regulation 41 of the Uncertificated Securities
Regulations 2001, the Company has specified that only those
shareholders registered on the register of members of the
Company at 11.00 p.m. on 11 June 2025 (or, if the meeting
is adjourned, 48 hours before the time of the adjourned
meeting) 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 that time
will be disregarded in determining the rights of any person to
attend and vote at the meeting.
5) As at 25 March 2025, the Company’s issued share capital
consisted of 52,176,292 shares carrying one vote each.
Therefore, the total number of voting rights in the Company
as at that date was 52,176,292.
6) Copies of the directors’ service contracts and terms and
conditions of appointment will be available for inspection at
the registered office of the Company during normal business
hours and at the place of the meeting from 15 minutes prior
to the meeting until its conclusion.
7) Any corporation which is a member can appoint one or more
corporate representatives who may exercise on its behalf
all of its powers as a member, but powers purported to be
exercised by more than one authorised representative in
respect of the same shares will be treated as not exercised.
8) Save as provided below, members who wish to communicate
with the Company in relation to the meeting should do so by
writing to the Registrars at The Pavilions, Bridgwater Road,
Bristol BS99 6ZZ. No other methods of communication will
be accepted. In particular, no person may use any electronic
address to communicate with the Company for any purposes
other than those expressly stated in the relevant document.
9) Members have the right to require notice of a resolution to
be moved or a matter to be included in the business of the
meeting.
Any addressee of this notice who has sold or transferred all of
the shares of the Company held by him or her, should pass the
annual report, of which this notice forms part (including the
form of proxy enclosed herewith), to the person through whom
the sale was effected for transmission to the transferee or
purchaser.
The Annual General Meeting
will be held on Friday 13 June
2025 at 12 noon
VENUE
Tallow Chandlers’ Hall
4 Dowgate Hill, London EC4R 2SH
CLOSEST TRANSPORT LINKS
Mansion House (District and Circle Lines)
Cannon Street (District and Circle Lines, National Rail Services)
Bank (Central, Northern and Waterloo & City Lines)
TALLOW
CHANDLERS’
HALL
103
SECRETARY AND REGISTERED OFFICE
Katya Merrick
M.P. Evans Group PLC
3 Clanricarde Gardens, Tunbridge Wells, Kent TN1 1HQ
Company number: 1555042
t +44 (0)1892 516 333
e enquiries@mpevans.co.uk
w www.mpevans.co.uk
INDONESIAN REGIONAL OFFICE
PT Evans Indonesia
Gedung Graha Aktiva, Suite 1001,
Jl HR Rasuna Said Blok X-1 Kav 03, Jakarta 12950
MANAGING AGENT IN MALAYSIA
Straits Estates Sdn. Berhad
Loke Mansion, 147 Lorong Kelawei
10250 Penang
INDEPENDENT AUDITORS
BDO LLP
2 City Place, Beehive Ring Road, Gatwick,
West Sussex RH6 0PA
REGISTRARS
Computershare Investor Services PLC
The Pavilions, Bridgwater Road, Bristol BS99 6ZZ
t +44 (0)3707 071 176
w www.computershare.com
PRINCIPAL BANKERS
OCBC Bank
18 Jalan Tun Perak, 50050 Kuala Lumpur, Malaysia
AmBank Group
55 Jalan Raja Chulan, 50200 Kuala Lumpur, Malaysia
NatWest
89 Mount Pleasant Road, Tunbridge Wells, Kent TN1 1QJ
NOMINATED ADVISER AND BROKER
Cavendish Capital Markets Ltd
One Bartholomew Close
London EC1A 7BL
SOLICITORS
Hogan Lovells International LLP
Atlantic House, 50 Holborn Viaduct
London EC1A 2FG
PUBLIC RELATIONS ADVISERS
Hudson Sandler LLP
25 Charterhouse Square
London EC1M 6AE
ESG ADVISERS
Inspired PLC
Calder House, Preston
Lancashire PR4 2DZ
Professional advisers & representatives
CPO
Crude palm oil
EMG
Ex-mill gate
EUDR
EU Deforestation Regulations
Ffb
Fresh fruit bunches
HGU
Hak guna usaha: land lease granted by Indonesian government
ISCC
International Sustainability & Carbon Certification
PK
Palm kernels
PKO
Palm-kernel oil
RISS
RSPO’s Independent Smallholder Standard
RSPO
Round Table on Sustainable Palm Oil
Glossary
104
M.P. EVANS GROUP PLC
ANNUAL REPORT 2024
Celebrating
20 years
of milling at
Pangkatan
105
3 Clanricarde Gardens
Tunbridge Wells
Kent TN1 1HQ
United Kingdom
t +44 (0)1892 516 333
e enquiries@mpevans.co.uk
w mpevans.co.uk
CBP029912
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