An Established Vertically Integrated Palm Oil Production Company, - - PowerPoint PPT Presentation

An Established Vertically Integrated Palm Oil Production Company, Cote d’Ivoire Focussed on Growth

AGM Presentation: 16 July 2015

Overview

Vision to become a leading West African CPO Producer

Vertically Integrated

100% Owned Nursery 1,000’s of Smallholders Providing FFB Production from 60 t/hr Mill 24,000 ha Expansion Land 1,900 ha of Planted Estates

An AIM quoted vertically integrated palm oil producer in Cote d’Ivoire

Revenue Generative 51% owner of a 60 t/hr mill palm oil project, one of West Africa’s largest 21,836 tonnes of CPO produced for 6 months to 30 June 2015 vs 2014’s total 9 month production figure

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14,242 tonnes Increasing Production One of the only palm oil developers not in partnership or subject to takeover by a major Asian palm oil company Corporate Environment Market Demand Demand for palm oil estimated to double by 2020

Board of Directors

Andrew Tillery Non Executive Chairman 25 years operational management and private equity experience in Africa and other emerging markets including 10 years as a CEO in Cote d'Ivoire, West Africa where he had responsibility for managing a group of oil palm operations and founded a natural rubber business. Holds two Masters degrees from Oxford University, an MBA from the University of Chicago. Currently a Non executive director on 3 African agribusiness boards and adviser to several agribusiness investment funds in sub-Saharan Africa Youval Rasin Chief Executive Officer Founder of DekelOil and has held senior management positions in various companies within the Rina Group, a family holding company with interests in agriculture, mining, hotels etc. Qualified lawyer and active in Ivory Coast since 2002 with 9 years’ experience in agro-industrial projects including 7 years in the Palm Oil Industry. Shai Kol Chief Financial Officer Co-Founder of DekelOil. CPA & MBA graduate. 13 years work experience in finance, with significant business & international exposure. former KPMG corporate finance. Financial director for an international software company, Director of finance and business development for Yellow Pages leading fund raising and M&A activities. Lincoln Moore Executive Director For the past 6 years Lincoln has been active in the West African oil palm industry in Liberia and Sierra Leone including establishing and raising finance for palm oil developments. Former CFO of Sierra Leone Agriculture Ltd and former executive director of AIM listed Northcote Energy Ltd. Chartered Accountant and former senior manager at Deloitte and Touche. Orli Arav Non Executive Director Orli is Chief Investment Officer (“CIO”)

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Impala Energy an independent power project

• development. Prior to the formation of Impala, Orli was the Managing Director of the Emerging

Africa Infrastructure Fund (“EAIF”), a dedicated open-end commercial debt fund focused on infrastructure projects in SSA, where she was involved in the financing of over 35 infrastructure projects in SSA (approximately US$800 million of commitments) across 16 countries. Orli has also held roles in the project finance divisions of global accountancy firms PriceWaterhouseCoopers and Ernst & Young.

H1 ‘15 - Dramatic Production Increase

5,000 10,000 15,000 20,000 25,000

Total 2014 Production vs. H1 2015 Production

Total 2014 Production H1 2015

On track to significantly increase palm oil production in 2015 to over 30,000tn, the Mill’s first full year of operations

• 21,836

tonnes

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CPO and 3,733 tonnes of kernels produced for the six months to 30 June 2015

• 53%

increase

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14,242 tonnes produced for the whole of 2014

• Dramatic

increase testament to logistics solution to supply Fresh Fruit Bunches (‘FFB’) to the Mill

• CPO sales of 19,184 tonnes at an

average price per tonne of €617

• 3,760 tonnes of kernel sold at €183

per tonne ex-Mill

• Peak

harvesting season runs from March – June

Excellent Location

Expansion Plan

• 24,000 ha for plantations
• 60t/h mill
• New nursery (subject to funding)

Existing

• Smallholder relationships
• c.1,900 ha company

plantations

• 60t/h mill
• 1M plants nursery

Advantageous location and existing infrastructure Existing operations are located in Ayanouan, 2hrs from Abidjan’s port Good road links to the port and to Ghana Expansion land is located in Guitry, 4hrs from Abidjan’s port

Strategy

Immediate 1-2 Years

• Construct a palm kernel oil crushing facility by Q4 2015
• Develop a further 3,000 to 5,000 ha of company plantations in close

proximity to the first mill and increase yields of smallholders’ plantations

• Commence operations at 24,000ha Guitry including new nursery and

1,000ha of estates

• Finalise first land acquisition in Ghana of 10,000ha

Medium – Long Term 2-5 Years

• Expand planting at Guitry and construct second 60tphr palm oil mill
• Commence first nursery and pilot planting in Ghana
• Review new projects in Cote d’Ivoire and bordering countries

To rapidly increase production from the first project and fast track development of Guitry project

Market Opportunity

• International palm oil majors currently entering or expanding in West Africa to address lack of land in

Malaysia and Indonesia

• World’s three largest palm oil companies; Wilmar, Sime Darby and Golden Agri have entered West

Africa

• Dec 2013 - KLK, one of the leading global plantation companies, has acquired a 63% interest in

Liberian-based Equatorial Palm Oil at a significant premium to DekelOil

• DekelOil is currently one of the only established, palm oil developers with contiguous land not in

partnership with a major Asian palm oil company

Corporate Activity

• Palm oil is the most widely used edible oil in the world
• Demand estimated to double by 2020 (World Bank)
• Supply side limited by lack of land availability in traditional

growth zones in Malaysia and Indonesia

Palm Oil ‘000t Production Consumption Balance Benin 35 110 (75) Cote d'Ivoire 400 270 130 Ghana 120 160 (40) Guinea 50 75 (25) Liberia 42 61 (19) Nigeria 850 1240 (390) Sierra Leone 36 44 (8) Togo 7 90 (83)

1 of the last remaining West African palm oil developers without investment from a major

Cote d’Ivoire: An Ideal Environment

• Cote d’Ivoire has a well established palm oil industry with an

estimated 250,000ha of palm oil plantations

• Highly

dominant agriculture industry provides an existing agriculture workforce and commodity trading infrastructure

• Modern infrastructure: land, sea (largest port in West Africa),

air, electricity and communication

• Shortage of Côte d’Ivoire milling capacity for smallholders
• The Directors believe the market is relatively fragmented with

potential acquisition opportunities

• Economy grew by 8.1% in 2013 (source IMF projection)

Company No.

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Mills Hectares Annual tons FFB Palm oil production PalmCI (SIFCA, Wilmar & Olam) 12 39,000 1,107,443 250,000 SIPEFCI 2 11,035 264,083 56,778 Palm Afrique 2 7,100 295,200 59,040 SOGB 1 6,041 110,000 22,000 Total 17 63,176 1,776,726 387,818

Ayenouan Project

• 60

ton/hour mill, largest in West Africa, became operational in March 2014

• Total mill site size
• c.14 hectare, mill floor

base - c.9,000 s.q.m.

• At full capacity, the Mill can produce 70-75,000

tons of CPO

• An effluent treatment plant (‘ETS’) is being

built by leading provider KIS Group

• Kernel

crushing plant currently being constructed – due to commence operations in Q4 2015

• Mill management and operations team in place

Simple CPO Processing Methods

This hosts one of West Africa’s largest mills with production being

• ptimised to drive revenues

Site Pictures

A vertically integrated, world class Mill operation in West Africa

Feedstock for the Mill

Small Holder Estates

Relationships with 1,000’s of small holders Estimated annual yields from small holders of 10 tn/h of Fresh Fruit Bunch

Company Estates

1,900 ha planted to date at Ayanouan, partly yielding Costs to maturity: US$2,000/ha to US$2,500/ha Mature plantations in Côte d’Ivoire have a peak yield of 20-24t/h

A blend of small holder feedstock due to regional surplus supply and planted company estates which will come into maturity in the near term

Logistics

• Logistics Zone Managers recruited to coordinate

the delivery of fruit to collection points and Mill

• Continuous planning with local cooperatives to

enable the adequate and efficient delivery

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feedstock

• Three

‘Collection Points’ established providing multiple drop-off points for smallholders and managing congestion as trucks make deliveries for processing

• The Mill’s reception area has been designed to be

twice the size of those at traditional 70,000 tpa mills for efficiency purposes

• Contract signed with a subcontractor to transport

fruits from the Logistics Collection Points to the Mill

Developing an effective logistics network to ensure timely delivery of fresh fruit bunches ('FFB') to the Mill via Collection Points

Social and Environment

• RSPO member and certification process

to commence shortly

• Majority
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planting

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previously cultivated areas

• Planting

in partnership with local communities

• Palm oil effluent treatment plant planned
• All environmental permits in place
• Employ over 300 staff – majority local

management

Focussed on developing its projects sustainably and in line with RSPO standards

First Mill Economics at Maturity

Description Calculation FFB Received 330,000 CPO Produced Extraction Rate – 24% Pricing €700/tn €55.5m PKO Extraction Rate – 4% for Kernels and 45% for PKO (€1,000tn) €6.0m Animal Feed Extraction Rate – 4% for Kernels and 45% for Kernel Cake (€180tn) €1.0m Total Revenue €62.5m EBITDA Margin 25% €15.6m Interest Expense 10.5% on €15m €1.6m Tax 13 year zero tax exemption Nil Net Profit After Tax €14.0m DekelOil Public Share 51% Share €7.1m

Expansion

• Construct 60tn/day Kernel Crushing Plant at existing mill site
• Construction period of 12 months, operational by Q4 2015
• Produce and sell both Palm Kernel Oil and animal feed at factory gate
• Will materially increase profitability of Ayenouan project

Ayenouan Kernel Crushing Plant to Improve Profitability of Existing Operations

• Plant an additional 3,000 to 5,000 ha over the next 24 months
• Provides future FFB input for existing Mill
• Improves long term EBITDA Margin

Ayenouan Expand Company Owned Planted Land to Increase Margins of Existing Operations

• Establish 1m plants per year nursery at 24,000ha Guitry site
• Identical to nursery established at Ayenouan
• Lays foundations for Guitry expansion plan
• Proof of concept assists with accessing project funding

Guitry Replicate Success at Ayenouan to Strengthen Balance Sheet and Build Presence

Current Corporate Structure

DekelOil Public Ltd - Key Shareholders % Youval Rasin 26.3 Remaining Board of Directors and Family of CEO 13.4 Institutions, PCB’s, HNW on IPO 19.2 Nubuke African Fund 2.8 Equity €m Debt €m Founder Investment – 2007 2.2 Mill Financing (10.5%, 8 years) 14.0 Siva Investment – 2010 5.0 Other bank loan (10%, 4 years) 0.8 IPO Investment – Mar 2013 (1p) Siva matchup 2.3 2.0 Line of credit 0.4 African fund (Nubuke) – Feb 2014 (1.5p) Siva matchup 0.8 0.5 Siva Capital Note (10%, only paid in preference to dividends) 4.5 Aim placing of £1.5m (1.25p) 2.0 Other Loan Notes (No interest, only paid in preference to dividends) 2 Total 14.8 21.7

Investment Case

• Revenues and operating profitability achieved from production at palm oil mill
• Smallholder contracts secured to provide feedstock for the mill
• Three local off-take agreements to diversify sales outlets

Production Expansion

• Ramping up production at Ayenouan in 2015
• Plans to expand company owned planted land at both project areas to become

a leading West African CPO producer

• Continued assessment of synergistic project opportunities in Cote d’Ivoire and

region

Location

• Cote d’Ivoire is a leading palm oil and agricultural producer in West Africa –

suitable infrastructure

• West African palm oil projects in strong demand by majors looking to expand

production outside of Malaysia and Indonesia

Asset Backed

• 51% interest in one of West Africa’s largest CPO mills
• 24,000 hectares of brownfield land, 1,900 ha of which is already planted
• Land developed in partnership with community under Abusan (2 third/1 third
• wnership split)
• Nursery capable of producing 1 million plants per annum

Support

• Increased institutional representation across shareholder register
• Government support by way of 13 year tax relief across operations
• Ayenouan is under a 51:49 JV with Indian conglomerate The Siva Group

Contacts

Youval Rasin Chief Executive Officer Mob: +972544 60467 Email: youval@dekeloil.com Lincoln Moore Executive Director Mob: +447500 090 139 Email: lincoln@dekeloil.com

DEKELOIL