New Britain Palm Oil Ltd 2012 New Britain Palm Oil Ltd 2012 New - - PowerPoint PPT Presentation

New Britain Palm Oil Ltd

2012

New Britain Palm Oil Ltd

2012

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New Britain Palm Oil Ltd

2012

Preliminary Results 2011

February 2012

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Recently upgraded facilities on New Britain

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New Britain Palm Oil Ltd

2012

Introduction

• Record levels of oil palm fruit processed and palm oil produced during 2011
• Record revenue and earnings in 2011
• Clear growth strategy: plantation expansion onto grassland at RAMU, and margin growth at KPOL
• Total land holdings of 129,130 hectares, and 102,231 hectares under cultivation
• Unique vertical integration from seed to refjned product
• Largest private employer in Papua New Guinea
• Plan at IPO in late 2007 to double plantation area in 7 - 8 years, achieved in 3
• Demand for palm oil as the cheapest vegetable oil foodstuff remains high and is aligned to the urbanisation of emerging

economies and rise of the middle class

• New Britain Oils (downstream palm oil refjning and processing) reporting excellent progress in Liverpool, UK

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NBPOL plantation in West New Britain, PNG

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New Britain Palm Oil Ltd

2012

Highlights - 2011

2011 2010

FFB processed (million tonnes) 2.4 1.9 CPO / PKO produced (tonnes) 591,477 478,667 Average CPO price achieved ($ / tonne) $1,108 $850

2011 2010

Revenue ($m) 780 461 EBITDA* ($m) 337 179 Profjt before tax* ($m) 276 131 Earnings per share* (US ¢) 141 60

* Excluding IAS 41

21% 24%

69% 88%

110% 134% 30%

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Nursery estates in New Britain

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New Britain Palm Oil Ltd

2012

Highlights - 2011

• Group had cash holdings at the end of 2011 of $60.1m, with a further $81.5m in trade oil debtors, which has subsequently

been received

• At the end of 2011 forward sales of c.144,750 tonnes of CPO of 2012 production had been made at an average price of

$1,057/tonne

• As at 15 February 2012 this fjgure was c.220,000 tonnes at an average price of $1,078/tonne
• Palm product extraction rates increased to 28.2% (2010: 27.5%)
• KPOL integration is making progress, with a contribution of $57.8m to PBT in 2011
• The performance of the Liverpool refjnery has exceeded expectations and is currently achieving high utilisation rates, Bakery

Fats plant has been commissioned

• Resumption of dividend in October 2011 with an interim payment of $0.15, a fjnal dividend of $0.15 will be payable in April

2012, taking the full year gross 2011 dividend to $0.30 per NBPO share

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Milling in progress

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New Britain Palm Oil Ltd

2012

Historical Financials

NBPOL share price (GBp) CPO $ / MT

2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 1100 1000 900 800 700 600 500 400 300 200 100 12/05 06/06 12/06 06/07 12/07 06/08 12/08 06/09 12/09 06/10 12/10 06/11 12/11 CPO CIF Rotterdam (US$/MT) NBPOL share price (GBp) 2004 2005 2006 2007 2008 2009 2010 2011 Revenue PBT 900 800 700 600 500 400 300 200 100

$m Note: excluding effects of IAS41

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NBPOL nursery, critical for expansion schedule

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New Britain Palm Oil Ltd

2012

Growth in Group Fresh Fruit Bunch (FFB) volume

Historical Operational Indicators

Growth in Palm Oil Produced Tonnes Growth in Oil Palm Plantations

30,000 35,000 15,000 20,000 25,000 2004 2006 Hectares 2005 2007 10,000 5,000 40,000 45,000 2008 55,000 60,000 50,000 65,000 70,000 2009 2010 CAGR:17.5% 75,000 2011 80,000 85,000 Tonnes FFB 2004 2006 2005 2007 2008 2009 2010 2011 2004 2006 2005 2008 2007 2009 2010 2011 200,000 240,000 80,000 120,000 160,000 40,000 280,000 320,000 360,000 400,000 440,000

CAGR: 16.3%

480,000 520,000 560,000 600,000 1,400,000 1,500,000 1,100,000 1,200,000 1,300,000 1,000,000 1,600,000 800,000 1,800,000 2,000,000

C A G R : 1 5 . %

1,900,000 1,700,000 900,000 2,100,000 2,200,000 2,300,000 2,400,000 2,500,000

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NBPOL and RAIL maintain a stock of cattle (of >19,000 head) utilising Palm Kernel Expeller, a high protein co-product

• f palm oil production

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New Britain Palm Oil Ltd

2012

Performance in Context

NBPOL share price, CPO, FTSE 250

50 100 150 200 250 300 350 400 12/2007 06/2008 12/2008 06/2009 12/2009 06/2010 12/2010

100 = NBPOL IPO in London (Dec. 2007)

06/2011 450 12/2011 06/2012 CPO CIF Rotterdam FTSE 250 NBPOL share price

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Oil palm nursery

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New Britain Palm Oil Ltd

2012

Delivering Growth at NBPOL:

Plantation expansion and margin growth

• 1. Plantation Expansion
• 2. Margin Growth

US$/tCPO

Cost of production (CoP) at NBPOL Total NBPOL Land Bank

• The KPOL estates should, in time, deliver some of NBPOL’s most

productive and highest margin estates

• CoP at KPOL should, in time, move toward or better the existing

NBPOL estates

• Within its current land bank NBPOL has c.12,000

hectares of land designated for new oil palm plantations

• A further c.15,000 hectares of land is in the process of

being acquired by NBPOL to ultimately form new oil palm plantations

01/01/2006 01/01/2007 01/01/2008 01/01/2009 01/01/2010 01/01/2011 01/01/2012 200 400 600 800 1,000 1,200 1,400 CoP - West New Britain NBPOL estates CoP - KPOL estates CoP - NBPOL Group CPO - CIF Rott

Existing NBPOL oil palm estates Land owned and available for planting by NBPOL NBPOL sugar estates Land in process of acquisition

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Recently upgraded storage tanking owned by NBPO at Kimbe port, PNG

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New Britain Palm Oil Ltd

2012

Hectarage Valuation

• The impact of KPOL

$27,562 $8,670 KPOL at time of acquisition NBPOL (as at Jan 2012)

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

EV ($) / Mature Hectare

EV ($) / Ha Taking into account mature

• il palm only and assuming

c.68,000 managed mature hectares within the enlarged NBPOL group

30,000 35,000

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Harvesting techniques Pollinisation and breeding programme

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New Britain Palm Oil Ltd

2012

Global Edible Vegetable Oil Market

12.50 12.00 11.50 11.00 10.50 10.00 9.50 9.00 8.50 8.00

1989/1990 1990/1991 1991/1992 1992/1993 1993/1994 1994/1995 1995/1996 1996/1997 1997/1998 1998/1999 1999/2000 2000/2001 2001/2002 2002/2003 2003/2004 2004/2005 2005/2006 2006/2007 2007/2008 2008/2009 2009/2010 2010/2011 2011/2012

Edible Oils - World Stocks:Usage Ratio (%)

Source: USDA

• Edible oils stocks:usage ratio continues to fall and palm oil prices continue to rise...
• ...in spite of an unprecedented increase in global palm oil production of 9% in 2011 to some 50m tonnes

%

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The controlled cultivation of oil palms in the nursery contributes to NBPOL’s successful replanting programme and relatively young

• il palm age profjle

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New Britain Palm Oil Ltd

2012

Palm Oil

• A vegetable oil used extensively in Asian and EU food markets and personal healthcare products
• The most productive vegetable oil
• High barriers to entry: signifjcant capex requirement and logistic support plus 3 - 4 years for a new plantation

to yield fruit

• High competition for suitable land

Source: USDA

Crop composition of land used globally to produce vegetable oils Composition of global vegetable oil production

Soya Sunseed Rape Palm

37% 16% 11% 36% 62% 17% 15% 6%

NBPOL Example Customers

• Ferrero
• Jordans
• Wilmar
• United Biscuits
• c.90% of NBPOL’s output is sold into the EU in

US$ contracts

Globally achieved Oil yield (tonnes / Ha) 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 Palm Oil (World Average) Rape Sun Soya

Source: USDA/NBPOL

5.0 5.5 6.0 Palm Oil (NBPOL) 6.5 Indicative oil yields

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Palm oil shipment from PNG into the UK refjnery

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New Britain Palm Oil Ltd

2012

NBPOL Location

• 78,332 total hectares of

managed oil palm plantations

• 68,438 hectares under harvest
• An additional c.42,000 hectares

cultivated by smallholders

• 129,130 hectares of total

land area with 102,231 under cultivation

PAPUA NEW GUINEA NEW BRITAIN NEW IRELAND SOLOMON ISLANDS AUSTRALIA

• Kimbe

Main area of NBPOL operation 36,126 hectares oil palm Lae• RAIL

• acquired in Oct 2008

10,685 hectares oil palm 7,720 hectares sugar cane 8,888 hectares pasture

• KPOL, Milne Bay
• acquired in April 2010

11,134 hectares oil palm

• KPOL, Higaturu
• acquired in April 2010

8,533 hectares oil palm

• GPPOL
• acquired in April 2005

6,318 hectares oil palm KPOL, Poliamba

• acquired in April 2010

5,536 hectares oil palm New Britain Oils The fjrst fully segregated and traceable sustainable palm oil refjnery in the UK. New bakery foodstuffs facility now completed

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Sterilisation of palm fruits, key fjrst stage processing

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New Britain Palm Oil Ltd

2012

NBPOL Today

Revenue contribution Plantations

• Land bank 129,130 ha
• 78,332 hectares under NBPOL cultivation

with respect to oil palm

• More than 42,000 mature hectares cultivated

by small-holders supplying NBPOL Milling and Refjning

• 12 oil mills in Group
• 2 refjneries
• Special fractionation plant completed for

Ferrero Infrastructure

• c.80,000 tonnes / oil storage capacity
• Trucking transport fmeet
• Housing
• Two new methane capture facilities nearing

completion

• Export terminals
• Highly respected plant breeding

research and development

• Important for success of wider

business

• Growing customer base around the

world

• NBPOL is one of the world’s largest

private seed producers

• Seed sales up to 11.8m seeds in the

period from 8.3m in the last period

• 8,888 hectares of cattle grazing land
• Integrated with the palm oil plantation
• Important for the protein constrained

local community

• >20,000 head of cattle

RAIL

• 1 sugar mill
• 1 ethanol plant
• 7,720 hectares sugar cane

Palm Oil Sales Seed Sales Cattle Production Sugar sales

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CPO being loaded at West New Britain, PNG CPO arrival storage tanks at New Britain Oils, UK

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New Britain Palm Oil Ltd

2012

New Britain Oils

• Complete and operational
• Running ahead of internal utilisation targets
• Offjcially opened by the PNG High Commissioner in

London, Ms Jean Kekedo on 25th August 2010

• World’s fjrst dedicated sustainable bakery foodstuffs

production facility now commissioned

• Key contracts with well known UK and EU brands
• Captures greater margin share for NBPOL
• First palm oil refjnery in the EU to have a fully

segregated and sustainable supply chain

• The fjrst palm oil provider able to guarantee fully

traceable, sustainable palm oil direct from the plantation to the EU consumer

• Further investment will continue in 2012/13

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Grassland and pasture available for planting in the Ramu Valley, incredible expansion potential

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New Britain Palm Oil Ltd

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RAIL

• Acquired in October 2008
• c.30,000 hectares of land
• Incredible expansion potential onto grassland
• 10,685 hectares of oil palm
• 7,720 hectares of sugar cane
• Oil palm planting and optimisation continues
• Extensive grasslands available for planting, key

expansion area for NBPOL

• Continued high priced sugar market continues the

positive outlook

• Sugar sales contributed a gross profjt of $27.4m to the

group (2010: $21.4m)

Ramu Agri Industries Ltd (RAIL)

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NBPOL facilities on New Britain, PNG

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New Britain Palm Oil Ltd

2012

Balance Sheet - 2011

50 100 150 200 250 RAMU Short term fjnancing - Liverpool refjnery KPOL facility

• Current debt of c.$315m
• 2011 Net Cash balance: $55m
• 2011 EBITDA: $337m
• Trailing year net debt/EBITDA: 0.8x (2010: 1.6x)

$m

300 350

Current Debt Position

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Replanting programme in process on West New Britain, PNG

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New Britain Palm Oil Ltd

2012

Corporate Structuring

• NBPOL’s standing with the provincial governments in PNG is critical and contributes to NBPOL’s success
• Facilitating NIDC and IPBC to swap into NBPOL shares will strengthen this positive relationship
• Shares acquired from KPOL and Poliamba are likely to enhance the US$/hectare valuation of NBPOL and enhance

earnings per NBPOL share

• >99.9% of NBPOL shareholders voting at the EGM on 30 January 2012 voted in favour of disapplying pre-emption for

up to a fjve percent issue of NBPOL shares to enable this share acquisition

Other holdings 80% 20% 18.7% 81.3%

IPBC NIDC Poliamba Limited Poliamba Higaturu Milne Bay Kula Palm Oil Ltd (“KPOL”) Poliamba Higaturu Milne Bay Poliamba Limited Kula Palm Oil Ltd (“KPOL”)

Other holdings 100% 100% c.0.4% c.2%

IPBC NIDC

NBPOL Current Position Proposed Reorganisation

Other Shareholders

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Kumbango mill carbon reduction methane capture project

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New Britain Palm Oil Ltd

2012

Carbon Footprint Report

• For NBPOL to remain at the forefront of sustainability best practice in

the industry, it has chosen to publish the fjrst detailed life cycle carbon emissions for palm oil

• NBPOL was a leader in the industry with the RSPO, it sees carbon

reporting as critical going forward and has again positioned itself as a leader

• Highly detailed study based on data collected over 20 years
• Scope - West New Britain operations (55,976 ha, c.8,000 smallholders)
• All operations (further sites) completed by 2013
• Report took over 12 months to complete
• Life Cycle Assessment approach – 95% capture - “cradle to refjnery gate”
• Extension of the work fjrst reported in NBPOL 2009 sustainability report

and represents a measurable, time bound commitment to CO2 reduction.

• Working toward ‘no net loss’ Carbon balance on future expansions
• Full report available at www.npol.com.pg

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Social awareness, support, and interaction is vital in PNG, especially as NBPOL provides housing, healthcare, recreational facilities, and education to a large proportion of its approximate 11,500 permanent employees. NBPOL takes its responsibilities to its employees extremely seriously and recognises its obligations to the workforce which rely heavily on the company

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New Britain Palm Oil Ltd

2012

Sustainability

• All long standing NBPOL estates and supply chain certifjed as sustainable and traceable
• Firm commitment to have all new units and supply chains certifjed as fully sustainable and traceable by the end of 2012
• NBPOL was instrumental in developing the Roundtable on Sustainable Palm Oil (www.RSPO.org)
• NBPOL has control over its harvesting, milling, transportation, shipping and refjning, it can trace individual shipments

back to source

• With the UK refjnery it has a unique fully sustainable and traceable supply chain to the EU
• In September 2011, the World Economic Forum (WEF) identified NBPOL as one of 16 out of a study of 1000 companies

that are best showing how to grow profits at the same time as actively tackling environmental and social challenges

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NBPOL newly planted estates

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New Britain Palm Oil Ltd

2012

• 2011: record year fjnancially and operationally
• Growth inherent in the group, from plantation expansions at Ramu, and margin growth to come from KPOL
• Palm oil fundamentals remain strong
• Very stable, low geared capital structure
• Focus of the business on planting and integration of KPOL

Conclusions

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• The information contained in this document is for information only. No representations or warranties, express or implied,

are given by the Company or any person connected with the Company as to the fairness, accuracy or completeness of the information or opinions contained in this document, any presentation made in conjunction herewith or the accompanying materials and no liability is accepted in respect thereof, to the extent permitted by law.

• To the fullest extent permitted by law, none of the Company, Akur Partners LLP or any other party or any of their respective

subsidiary undertakings or affjliates or any of such person’s offjcers or employees, advisors or other representatives, accepts any liability whatsoever (whether in negligence or otherwise) arising directly or indirectly from the use of this document.

• This document is being furnished to you on a confjdential basis and may not be disclosed, reproduced or redistributed, in

whole or in part, by any medium or in any form to any other person for any purpose without the Company’s prior written

• consent. You shall treat and safeguard as strictly private and confjdential all information contained in this document and take

all reasonable steps to preserve such confjdentiality. You shall not use this document or the information contained therein in any manner detrimental to the Company.

• This document has been prepared for information purposes only and should not be relied upon, or form the basis for any

decision or action, by any person.

• This document contains forward-looking statements that involve substantial risks and uncertainties and actual results and

development may differ materially from those expressed or implied by these statements by a variety of factors.

• By accepting this document and attending the presentation you agree to be bound by the foregoing limitations.

February 2012

Disclaimer

New Britain Palm Oil Ltd

2012

www.nbpol.com.pg

Phone: +44 (0)20 7472 5936

New Britain Palm Oil Ltd

2012