M.P. Evans Group PLC : now only held in the one hand of palms
Source: Company Website
M.P. Evans Group (MPE.AIM) is a 150-year old company that has adopted the slogan ‘One country, One Commodity’ to reflect its business of producing crude palm oil through the ownership, management and development of sustainable estates in Indonesia, Palm oil is very widely used in the commercial food industry around the world and accounts for more than 30% of global vegetable oil production. It is the cheapest oil to produce and the most traded with a secondary use in biodiesel fuel production. Indonesia is the world’s largest producer of palm oil and is planning to double production by the end of 2030.The high yield of the trees has encouraged wider cultivation, leading to the clearing of forests in parts of Indonesia and Malaysia to make space for oil-palm monoculture, thereby attracting criticism from environmental activists and leading in turn to the formation of an industry Roundtable on Sustainable Palm Oil, of which MPE is a member. In the first half of 2017 the Company reported revenue up by nearly 90% to $57.5M and profits from continuing operations up more than threefold to $13.5M. A further $68M profit from the sale MPE’s stake in a JV plantation has boosted net cash to over $140M. The share price perked up with a rejected bid in 2016 but has been quiet in the last few months as new bid speculation has yet to be fulfilled. The current Market Cap is around £435M.
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By Alastair Winter
Chief Economist at Daniel Stewart