FERONIA INC. REPORTS 2016 RESULTS
TORONTO, ONTARIO – May 1, 2017: Feronia Inc. (“Feronia” or the “Company”) (TSX-V: FRN) today released its audited financial results for the year ended December 31, 2016. All amounts in this release are expressed in US dollars unless otherwise indicated.
- Produced 109,687 tonnes of fruit (2015: 88,572 tonnes), a year-over-year increase of 24%
- Produced 20,726 tonnes of crude palm oil (“CPO”) (2015: 16,783 tonnes), a year-over-year increase of 23%
- Fresh fruit bunch (“FFB”) yield of 7.7 tonnes per mature hectare (“ha”) (2015: 8.1 tonnes per mature ha)
- Oil extraction rate (“OER”) of 19% (2015: 19%)
- Revenue of $16.5 million (2015: $10.9 million), a year-over-year increase of 51%, primarily from the sale of 23,293 tonnes of CPO at an average price of $639 per tonne (2015: 13,926 tonnes at $714 per tonne)
- Completed first drawdown of $15 million from the secured term facility (the “DFI Debt Facility”) and, concurrent with the first drawdown, a total of $31,330,000 principal amount of debentures and accrued interest converted into an aggregate of 291,693,813 common shares
- Net loss of $11.8 million or $0.04 per share (2015: net loss of $29.4 million or $0.53 per share)
- Completed second drawdown of $10 million from the DFI Debt Facility on February 15, 2017
- Completed installation of new Lokutu boiler which is now operational
Xavier de Carnière, Chief Executive Officer of Feronia Inc. commented: “First and foremost, we are gradually succeeding in rebuilding this business into a financially sustainable and profitable operation, and thereby demonstrating that effective ethical investment can be a reality in the DRC.
“There have been many bumps in the road to date and there will undoubtedly be more to come. However it is with great satisfaction and pride that I reflect upon what we have achieved in 2016. Operationally, our production levels are increasing along a trajectory we long since predicted and, with those increases, our financial position strengthens accordingly. With the financial support of our DFI investors and lenders, we are putting in place the infrastructure to deal with the continued growth in production we expect to come and we are making a real and positive difference on the ground for our employees, their families and those who live in the areas in which we operate.
“Operating in the remotest parts of DRC is often challenging, and those that have made the sometimes long journey to our sites can truly appreciate our achievements.
“In spite of the operational challenges, and the economic and political uncertainty, we are succeeding in securing jobs, increasing wages and ensuring our employees do not suffer as a result of the country’s current economic woes through the introduction of initiatives such as an index linked pay mechanism. We are rebuilding social infrastructure and creating sustainable livelihoods. We are creating hope and opportunities in one of the poorest corners of one of the poorest countries in the world. We are re-establishing the basis of a rural economy around us, which entire provinces can build upon.
“Rebuilding a business such as ours is a singular challenge. To have built this business from scratch would have required significantly more time and capital than what has been invested to date. We are taking a relic of a bygone era and turning it in to a business fit for the 21st Century. It is not easy, nor quick, nor cheap, but we firmly believe in the commercial opportunity we have before us and the positive impact that commercial opportunity will have on all of our stakeholders.”
For further information please contact:
Xavier de Carniere
Chief Executive Officer, Feronia Inc.
44 (0)7468 697 658
Director of Communications and Corporate Development, Feronia Inc.
44 (0)7554 521421
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.
- 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 106 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 has 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, 2016, 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.