United Cacao (AIM: CHOC), the AIM-listed cacao plantation company based in Peru, announces its unaudited half yearly results for the period ending 30 June 2015. All figures are in US dollars unless otherwise indicated.
Highlights:
- The Company achieved a total planted area of 1,167 hectares ("ha") comprised of 1,150 ha of owned estates and an additional 17 ha under the Programa Alianza Producción Estratégica Cacao ("PAPEC") programme (compared with a total planted area of 556 ha at 31 December 2014).
- 3,787 ha of agriculturally titled, freehold land owned by the Company (compared with 3,602 ha at 31 December 2014).
- Decisive court ruling by the Loreto Superior Court of Appeals on 26 March 2015 reconfirming the agricultural zoning and regulatory approval process for the Company's estates.
- On 17 April 2015, the launch of the PAPEC programme, an innovative small farmer out-grower scheme designed to lift thousands of families out of poverty and provide the Company with stable, long-term processing income.
- Successful dual listing of the Company's share capital on the Lima Stock Exchange (Bolsa de Valores de Lima) on 19 June 2015.
By year-end 2015, the Company expects to achieve a total planted area of 1,950 hectares comprised of 1,750 ha of owned estates and 200 hectares under PAPEC. By year-end 2016, the Company expects to achieve total planted area of 3,000 ha, comprised of 2,500 ha of owned estates and 500 ha under the PAPEC program, subject to the availability of sufficient working capital. Remaining planting works on the Company's owned estates, to achieve the objective, as stated in the Company's AIM Admission Documentation, of 3,250 ha (planted owned estates), are expected to be completed during first half 2017.
The Company intends to maintain the PAPEC programme planting rate at approximately 250 ha per annum until after the Company achieves expected EBITDA and net income profitability in 2018 and 2019, respectively. Once the Company achieves net income profitability, the PAPEC programme would then be expanded rapidly in subsequent years to achieve the previously stated objective of 3,250 ha of small farmer out-grower estates (as announced on 21 April 2015), thereby taking the Company's total planted project area to approximately 6,500 ha by 2021.
Mr Dennis Melka, Executive Chairman and CEO commented:
"We are delighted at the progress the Company has made thus far in 2015. We are now the largest cacao estate in Peru, which is the global low-cost location for the production of cacao, and by year-end, we expect to be the largest cacao estate in Latin America. Upon completion of planting of the Company's owned estates in early 2017, we expect to be the largest corporate cacao estate in the world. Whilst the global chocolate confectionary market continues to grow, the three main cacao producing countries, Cote d'Ivoire, Ghana and Indonesia, are all now experiencing a contraction in production, thereby providing a significant opportunity for the Company. Our small farmer out-grower programme, PAPEC, continues to advance and improve the livelihoods of hundreds of families near our estate. "