TORONTO, ONTARIO–(Marketwired – May 30, 2016) – Feronia Inc. (“Feronia” or the “Company”) (TSX VENTURE:FRN) today released its financial results for the three months ended March 31, 2016. All amounts in this release are expressed in US dollars unless otherwise indicated.
Q1 2016 Highlights
- Produced 21,276 tonnes of fruit (Q1 2015: 18,613 tonnes), a year-over-year increase of 14%
- Produced 4,045 tonnes of Crude Palm Oil (“CPO”) (Q1 2015: 3,599 tonnes), a year-over-year increase of 12%
- Oil extraction rate of 19% (Q1 2015: 19%)
- Revenue of $4.0 million (Q1 2015: $2.5 million) primarily from the sale of 5,551 tonnes of CPO at an average price of $636 per tonne (Q1 2015: 2,917 tonnes at $777 per tonne)
- Net loss of $329,000 (Q1 2015: net loss of $3,053,000)
- Closed the final tranche of secured convertible debentures (the “Debentures”) through the private placement of a $3.2 million Debenture with the African Agricultural Fund through Golden Oil Holdings Ltd
- Publication of Environmental & Social Assessment report
- Completed first drawdown of $15 million from secured term facility agreement and, concurrent with the first drawdown, $31.33 million principal amount of Debentures and $2.7 million of accrued and unpaid interest converted into 291,693,813 common shares
Xavier de Carnière, Chief Executive Officer of Feronia Inc. commented: “The operational team achieved a smooth first quarter this year, meeting their production targets.
Low global palm oil prices and the significant amount of illegal imports of palm oil, driven by sharp currency fluctuations in countries neighboring the DRC, negatively impacted the Company over the past year. Both of these issues seem to be behind us and we see a more favourable competitive landscape ahead.
Our new boiler and turbine in Lokutu will soon be operational, which should greatly reduce our energy costs and positively impact our extraction rate. We are launching equivalent projects in our Yaligimba and Boteka plantations, with similar impacts on productivity expected towards the end of 2017.
Operationally we are entering into a virtuous circle, which should translate into progressively improved performance moving the Company along a path to achieve our long term goals. Our production volumes and efficiency should continue to increase as we improve and increase our industrial capacity, gradually freeing up additional resources to advance our ambitious social and environmental targets with the continued support of our shareholders and lenders.”
About Feronia Inc.
- Feronia is an agribusiness operating in the Democratic Republic of the Congo (DRC).
- At the heart of Feronia lies a long established palm oil business, Plantations et Huileries du Congo (PHC), which has three remotely located plantations; Lokutu, Yaligimba and Boteka. We also have an arable farming operation which grows and processes rice.
- When Feronia acquired its palm oil business from Unilever in 2009, it had suffered from years of underinvestment and considerable disruption caused by conflict in the DRC. Our initial focus has been on rebuilding the business and resuming production to secure its future and the livelihoods of the 3,800+ people we directly employ.
- Feronia’s plantations produce crude palm oil (CPO) and palm kernel oil (PKO). CPO is part of the staple and traditional diet of the Congolese and, with our products sold locally in the DRC, we are well placed to help decrease reliance on imports and increase food security and quality.
- Feronia prides itself on being the guardian of our 105 year-old palm oil business and its employees, communities, and environment. We have a long term commitment to improve the living and working environment of our employees and their communities and are committed to sustainable agriculture, environmental protection and community inclusion. Feronia has in place an Environmental and Social Action Plan which is focused on implementing environmental and social best practice and improving social infrastructure.
- Feronia is working towards certification by the Roundtable for Sustainable Palm Oil (RSPO) and is implementing IFC/World Bank standards for environmental and social sustainability. Our oil palm replanting programme is brownfield in nature – replacing old palms with new – and it has no reliance on deforestation.
- Feronia’s management team is comprised of senior agriculturalists with extensive experience in managing both plantations and farming operations in emerging markets.
- For more information please see www.feronia.com
Except for statements of historical fact contained herein, the information in this press release constitutes “forward-looking information” within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as “anticipates”, “plans”, “proposes”, “estimates”, “intends”, “expects”, “believes”, “may” and “will”. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others: risks related to foreign operations (including various political, economic and other risks and uncertainties), the interpretation and implementation of the “Loi Portant Principes Fondamentaux Relatifs A L’Agriculture”, termination or non-renewal of concession rights or expropriation of property rights, political instability and bureaucracy, limited operating history, lack of profitability, lack of infrastructure in the DRC, high inflation rates, limited availability of debt financing in the DRC, fluctuations in currency exchange rates, competition from other businesses, reliance on various factors (including local labour, importation of machinery and other key items and business relationships), the Company’s reliance on one major customer, lower productivity at the Company’s plantations and arable farming operations, risks related to the agricultural industry (including adverse weather conditions, shifting weather patterns, and crop failure due to infestations), a shift in commodity trends and demands, vulnerability to fluctuations in the world market, the lack of availability of qualified management personnel and stock market volatility. Details of the risk factors relating to Feronia and its business are discussed under the heading “Risks and Uncertainties” in Feronia’s Management’s discussion and Analysis for the year ended December 31, 2015, a copy of which is available on the Company’s SEDAR profile at www.sedar.com. Most of these factors are outside the control of the Company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the Company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.
Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Xavier de Carniere
Chief Executive Officer
44 (0)7468 697 658
Investor Relations Manager
44 (0)7554 521421