DECA

Final Results

RNS Number : 9171W
Agriterra Ltd
29 November 2010
 



Agriterra Ltd / Ticker: AGTA / Index: AIM / Sector: Agriculture

29 November 2010 

Agriterra Ltd ('Agriterra' or 'the Group')

Final Results

 

Agriterra Ltd, the AIM listed company focussed on the agricultural sector in central and southern Africa, announces its results for the year ended 31 May 2010.

 

CHAIRMAN'S STATEMENT

 

We have continued our strategy during the year of building an African focused agricultural group, with the initial focus being on our grain processing and milling activities and the development of our cattle ranching operations in Mozambique. 

 

The year to 31 May 2010 was a period of consolidation as we looked to capitalise on our strong position in Mozambique, particularly in the milling business and to expand our cattle ranching activities.  Accordingly we continued the development of our grain buying infrastructure centred at our main Desenvolvimento E Comercialização Agricola Limitada ('DECA') facility at Chimoio, which now has a storage capacity of 40,000 tonnes.  In addition, at the Compagri Limitada ('Compagri') facility in the Tete Province, following completion of the first phase of development, including the installation of milling equipment and a storage capacity of 12,600 tonnes, we established the buying operation with the requisite infrastructure.

 

At Mozbife Limitada ('Mozbife'), the cattle ranching business, we secured further land, including the 350 hectare Vanduzi farm for our feedlot and abattoir project, expanded the irrigated pasture land at the 1,000 hectare Mavonde Ranch and initiated an extensive planning and preparation programme at the 15,000 hectare Dombe Ranch, pending the award of a Use and Development of Land Licence ('DUAT') from the Government of Mozambique.  The Board expects that this will be granted shortly, following which we can commence the implementation stage which will be funded from the US$7 million placing (before expenses) at 3p per share, as announced on 16 November 2010.  

 

During the year, facilitated by our expanded infrastructure, including additional purchasing points and an enlarged vehicle fleet, the Group has had a record buying season with Chimoio accounting for 34,000 tonnes of corn (2008/9: 23,000 tonnes) and Compagri 8,000 tonnes.  However, the results were adversely affected by a number of factors including management difficulties at Compagri which delayed the start of milling operations and contributed to this facility incurring an operating loss of US$1.2m during the year.  An operating loss of U$0.4m pertaining to Mozbife was also incurred as the necessary infrastructure was implemented and developed, and the Group expensed US$0.9m fulfilling its obligations at our discontinued oil and gas operations in order to maintain our exploration rights whilst arranging an exit. 

 

In addition, a strong harvest in Mozambique resulted in lower demand for meal product and consequently sales at Chimoio were down 27% in local currency terms and 36% in US$ terms.  These lower volumes also adversely affected gross margins. 

 

However, since the year end, the situation has greatly improved particularly with regards to pricing and we have made substantial progress in all areas of the business.  As explained above, the DUAT for the Dombe Ranch is expected imminently following formal approval from the Centro de Promocao de Investimentos (Major Investment Project Approval).  As a result, investment in infrastructure at the Dombe Ranch and feedlots at the Vanduzi farm has accelerated, together with investment in the local herd at Dombe.  Planning has been completed for the construction of a 42 billion litre reservoir to sustain a further 400 hectares of irrigated pasture at Mavonde in Mozambique which will support eight head of cattle per hectare when established.

 

The current year commenced with 22,000 tonnes of maize in stock, which we strategically held back for an improved price environment, which has now materialised.  Produce sourced locally has been supplemented by competitively priced imports and we are now processing 4,000 tonnes per month.  We currently have more than 30,000 tonnes of maize in stock, which we are processing on a 24 hour shift pattern at Chimoio.  Milling operations have now commenced at Compagri, further enhancing the current strong performance of sales from DECA with volumes and prices well ahead of the year ended 31 May 2010.  We continue to expand our market penetration in Mozambique and are expecting to commence both meal and bran sales into Zimbabwe.  In the second half of this year we are also looking to expand storage capacity at Compagri to enable us to bring additional products into our range.

 

Additionally we have concluded a farm out agreement with Africa Oil Corp to assign 80% of the Group's interest in the South Omo Block in Ethiopia, whilst allowing participation in any value uplift generated by the exploration work undertaken by them.

 

In spite of the challenges that we faced during the reporting period, we now have what I believe to be a very firm foundation for growth.  The recent trading update emphasised the strong performance of the milling operations at DECA with sales well above the Directors' expectations, the commencement of operations at Compagri as well as the progress being made at Mozbife.  Demand for beef remains extremely strong and we believe that we have the ability to capitalise on this.  In tandem with developing our ranching operations we are also actively looking for additional opportunities within the agricultural sector to supplement our strong organic growth. 

 

Finally I'd like to thank all those involved in the business for the fantastic job they have done, in particular Euan, in securing our position as a leading agricultural company with a focus on Mozambique.

 

Phil Edmonds

Chairman

 

 

OPERATIONS OVERVIEW

 

The key wholly owned subsidiaries of Agriterra are the agricultural trading and processing companies DECA and Compagri, as well as the rapidly expanding cattle ranching and feedlot production entity, Mozbife, all of which are located in Mozambique. 

 

DECA, Chimoio

 

Our flagship agricultural trading facility in Chimoio is focused on the treatment and processing of grain purchased from out-growers through specialised buying systems, delivering cash directly to the smallholder farmers and supporting approximately 350,000 people from the local population.  The purchased grain is transported back to DECA's purpose-built storage and processing facility in Chimoio where it is dried, fumigated, prepared and processed into maize meal to supply to domestic markets. 

 

Over the course of the year, the Directors have focused on increasing the storage capacity at Chimoio, and the facility now has a 40,000 tonne capacity comprising of seventeen 1,000 tonne silos, seven large warehouses as well as two milling plants, one workshop and a fleet of over 100 vehicles.  This increase in storage capacity, coupled with expanded infrastructure, additional purchasing points and an enlarged vehicle fleet, enabled DECA to achieve a record buying season, with over 34,000 tonnes purchased in total.

 

Our branded DECA product is also gaining increased market share, particularly in the Beira area which is DECA's biggest market.  Despite a reduction in sales during the period caused by a strong harvest in Mozambique, sales since the year end have been very encouraging and are significantly ahead of last year.  Our objective with DECA is to now ramp-up our milling operation with the aim of increasing production by 30% from current levels.  To achieve this, the milling operation has been running 24 hours a day, 6 days a week since the beginning of October.

 

Compagri, Tete

 

Our second grain processing operation, Compagri, based in the Tete Province of Mozambique, commenced operations in May 2009, replicating the operations of the DECA facility in Chimoio. 

 

During the year, we completed the initial phase of development, which included the construction of four 1,500 tonne silos and one 600 tonne silo, as well as two further large warehouses with capacity of 3,000 tonnes each, providing the facility with a total storage capacity of 12,600 tonnes.  We also established extensive buying operation infrastructure including the implementation of buying points in rural parts of the Tete region.

 

The Compagri facility has performed well since operations began, despite a management dispute earlier in 2010 which necessitated a temporary suspension of operations.  The Board installed a new management team following these labour issues, led by Jean Bernard Guimbeau, who has extensive agricultural management experience in southern Africa and Miguel Cruz, a Mozambican national, who has been the southern area buying manager at the DECA facility in Chimoio for four years.

 

Since recommencing operations in July 2010, the Compagri facility has received higher than anticipated inflows of grain, with over 10,000 tonnes of grain now in stock.  Milling operations have also commenced, with target milling production of 40 tonnes per day, which could be raised to a maximum of 120 tonnes per day when a 24 hour rotational shift is implemented. 

 

We remain optimistic about the future for the Compagri facility, particularly as our brand is increasingly gaining local recognition.  The Tete region itself is also an area with significant scope for expansion due to the vast developments in the coal mining projects in the area which will bring substantial inflows of workers to the province.  In order to capitalise on this expected increase in demand, we are evaluating options to increase the current storage capacity to accommodate larger volumes of maize and potentially additional agricultural products.

 

Mozbife Cattle Ranching

 

We continue to focus on rapidly growing our cattle ranching business, Mozbife, and currently have two ranches covering 16,000 hectares and a current stock of circa 1,060 head of cattle.

 

The calving season is currently underway at both our 1,000 hectare Mavonde and 15,000 hectare Dombe ranches, and regular veterinary checks are reporting that all of our cattle are in good condition.  We experienced a high rate of 82% pregnancies in our cows and heifers, and expect that this current calving season will significantly increase our herd, ensuring we are well positioned to deliver on our objective of expanding our herd to over 5,000 head by 2012.

 

In order to accommodate this increase in cattle, we have focused on the development and irrigation of additional land within our Mavonde and Dombe ranches following Centro de Promocao de Investimentos approval (Major Project Investment Approval) from the Mozambican Government, allowing us to aggressively move forward with our expansion plans pending the award of a DUAT.  At Mavonde, the irrigated pasture area has been extended to almost 300 hectares in anticipation of large number of calves and final planning for a 42 billion litre irrigation dam has been completed.  The Directors anticipate that when completed, this dam, which will be situated on the Mavusi River, will provide water for an additional 400 hectares of irrigated pasture.

 

The Vanduzi abattoir/feedlot project is also progressing well with the first feed pens completed and boundary fencing progressing well.  Our first cattle have recently arrived at the feedlot ahead of fattening and subsequent transferral to an abattoir.  In tandem, an extensive land clearing and preparation programme is currently underway, ahead of the planting of 200 hectares of maize crop to ensure security of feedlot which will be followed by the planting of 300 hectares of soya beans also for feedlot purposes.

 

Euan Kay

Executive Director

 

 

CONSOLIDATED INCOME STATEMENT

For the year ended 31 May 2010

 

 

 

 

Year

ended

31 May

 

11 Months ended

31 May

 

 

 

2010

 

2009

Continuing Operations

Notes

 

$'000

 

$'000

 

 

 

 

 

 

Revenue

 

 

8,791

 

4,855

Increase in value of biological assets

 

 

22

 

-

Cost of sales

 

 

(7,371)

 

(3,483)

 

 

 

 

 

 

Gross profit

 

 

1,442

 

1,372

 

 

 

 

 

 

Operating expenses

 

 

(5,686)

 

(2,222)

Other income

 

 

386

 

347

 

 

 

 

 

 

Operating loss

 

 

(3,858)

 

(503)

 

 

 

 

 

 

Finance income

 

 

106

 

338

Finance expense

 

 

(152)

 

(6)

 

 

 

 

 

 

Loss before taxation

 

 

(3,904)

 

(171)

 

 

 

 

 

 

Income tax expense

 

 

-

 

-

Loss for the year  from continuing operations

 

 

 

(3,904)

 

(171)

 

 

 

 

 

 

Discontinued operations

 

 

 

 

 

Loss for the year

3

 

(920)

 

(3,519)

 

 

 

 

 

 

Loss for the year attributable to owners of the parent

 

 

 

 

(4,824)

 

 

(3,690)

 

 

 

 

 

 

Loss per share

 

 

 

 

 

- Basic and diluted (cents)

4

 

(0.9c)

 

(1.1c)

 

 

 

 

 

 

Loss per share from continuing operations

 

 

 

 

 

- Basic and diluted (cents)

4

 

(0.8c)

 

(0.1c)

 

 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 May 2010

 

 

 

Year

 ended

31 May

 

11 Months

ended

31 May

 

 

2010

 

2009

 

 

$'000

 

$'000

 

 

 

 

 

Loss for the year

 

(4,824)

 

(3,690)

 

 

 

 

 

Foreign exchange translation differences

 

(6,005)

 

(3,999)

Other comprehensive income for the year

 

(6,005)

 

(3,999)

 

 

 

 

 

Total comprehensive income for the year

attributable to owners of the parent company

 

 

(10,829)

 

 

(7,689)

 

 

 

 

 

 

 

CONSOLIDATED BALANCE SHEET

As at 31 May

 

 

 

 

2010

 

2009

 

Note

 

$'000

 

$'000

 

 

 

 

 

 

ASSETS

 

 

 

 

 

Non-current assets

 

 

 

 

 

Exploration and evaluation costs

 

 

-

 

-

Property, plant and equipment

 

 

9,986

 

13,397

Investments

 

 

114

 

-

Biological assets

 

 

236

 

207

Total non-current assets

 

 

10,336

 

13,604

 

 

 

 

 

 

Current assets

 

 

 

 

 

Inventories

 

 

4,605

 

2,376

Trade and other receivables

 

 

1,019

 

1,492

Cash and cash equivalents

 

 

3,442

 

8,517

Total current assets

 

 

9,066

 

12,385

 

 

 

 

 

 

TOTAL ASSETS

 

 

19,402

 

25,989

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

Current liabilities

 

 

 

 

 

Trade and other payables

 

 

2,176

 

3,009

 

 

 

 

 

 

NET ASSETS

 

 

17,226

 

22,980

 

 

 

 

 

 

EQUITY

 

 

 

 

 

Issued capital

5

 

1,161

 

1,039

Share premium

 

 

125,184

 

119,349

Share based payment reserve

 

 

1,360

 

1,281

Translation reserve

 

 

(5,181)

 

824

Retained earnings

 

 

(105,298)

 

(99,513)

 

 

 

 

 

TOTAL EQUITY attributable to owners of the parent

 

17,226

 

22,980

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 


Ordinary share capital

$'000

Deferred share capital

$'000

Share premium

$'000

Share based payment reserve

$'000

Translation reserve

$'000

Retained earnings

$'000

 

Total

$'000

Balances at 1 July 2008

641

-

101,584

1,231

4,823

(95,823)

12,456

Loss for the period

-

-

-

-

-

(3,690)

(3,690)

Other comprehensive income








Exchange translation differences on foreign operations

-

-

-

-

(3,999)

-

(3,999)

Total comprehensive income for the period

 

-

-

-

-

(3,999)

(3,690)

(7,689)

Transactions with owners








Division of share capital

(238)

238

-

-

-

-

-

Share based payment charge

-

-

-

50

-

-

50

Share issues

398

-

17,796

-

-

-

18,194

Issue costs

-

-

(31)

-

-

-

(31)

Total transactions with owners

 

160

238

17,765

50

-

-

18,213

Balances at 31 May 2009

801

238

119,349

1,281

824

(99,513)

22,980









Loss for the year

-

-

-

-

-

(4,824)

(4,824)

Other comprehensive income








Exchange translation differences on foreign operations

-

-

-

-

(6,005)

-

(6,005)

Total comprehensive income for the year

 

Transactions with owners

-

-

-

-

(6,005)

(4,824)

(10,829)

Share based payment charge

-

-

-

79

-

-

79

Acquisition of minority

-

-

-

-

-

(961)

(961)

Share issues

122

-

6,107

-

-

-

6,229

Issue costs

-

-

(272)

-

-

-

(272)

Total transactions with owners

122

-

5,835

79

-

(961)

5,075









Balances at 31 May 2010

923

238

125,184

1,360

(5,181)

(105,298)

17,226

 

CONSOLIDATED CASH FLOW STATEMENT

For the year ended 31 May 2010

 

 

 

 

Year ended

31 May

 

11 Months ended 

31 May

 

 

 

2010

 

2009

 

 

 

$'000

 

$'000

 

 

 

 

 

 

Operating activities

 

 

 

 

 

Loss before tax

 

 

(3,904)

 

(171)

Adjustments for:

 

 

 

 

 

- Depreciation of property, plant and equipment

 

 

1,359

 

164

- Profit on disposal of property, plant and equipment

 

 

(20)

 

-

- Share based payment charge

 

 

79

 

50

- Foreign exchange

 

 

(42)

 

-

- Net interest expense / (income)

 

 

46

 

(332)

Operating cash flow before movements in working capital

(2,482)

 

(289)

Working capital adjustments:

 

 

 

 

 

- Increase in inventory

 

 

(3,182)

 

(1,153)

- Increase in receivables           

 

 

(523)

 

(137)

-(Decrease) / increase in payables

 

 

(506)

 

1,516

Cash used in operations

 

 

(6,693)

 

(63)

Finance charges

 

 

(152)

 

(6)

Interest received

 

 

106

 

338

Net cash (used in) / from continuing operating activities

(6,739)

 

269

Net cash outflow from discontinued activities

 

 

(783)

 

(1,255)

Net cash used in operating activities

 

 

(7,522)

 

(986)

 

 

 

 

 

 

Investing activities

 

 

 

 

 

Purchase of property, plant and equipment

 

 

(1,346)

 

(4,692)

Proceeds on sale of property, plant and equipment

 

 

135

 

-

Purchase of subsidiaries net of cash acquired

 

 

-

 

2,162

Purchase of biological assets

 

 

(64)

 

(169)

Investment in financial assets

 

 

(125)

 

(2,826)

Net cash used in investing in continuing activities

 

 

(1,400)

 

(2,699)

Net cash from / (used in) investing in discontinued activities

3

 

(1,918)

Net cash used in investing activities

 

 

(1,397)

 

(4,617)

 

 

 

 

 

 

Financing activities

 

 

 

 

 

Proceeds from issue of share capital

 

 

5,082

 

3,718

Share issue costs

 

 

(272)

 

-

Draw down of related party loan

 

 

225

 

127

Repayment of related party loan

 

 

(225)

 

-

Net cash  from financing activities

 

 

4,810

 

3,845

 

 

 

 

 

 

Net decrease in cash and cash equivalents

 

 

(4,109)

 

(1,758)

 

 

 

 

 

 

Cash and cash equivalents at start of the year

 

 

8,517

 

13,047

 

 

 

 

 

 

Exchange rate adjustment

 

 

(966)

 

(2,772)

 

 

 

 

 

 

Cash and cash equivalents at end of the year

 

 

3,442

 

8,517

 

 

NOTES TO THE FINANCIAL STATEMENTS

For the year ended 31 May 2010

 

1.

General Information

 

Agriterra Limited is incorporated and domiciled in Guernsey.  The nature of the Group's operations and its principal activities are set out in the Chairman's Statement and Operations Overview above.

 

The reporting currency for the Group is the U.S. Dollar (USD) as it better reflects the Group's business activities in the agricultural sector in Africa.  Full statutory financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union. 

 

The financial statements for the year ended 31 May 2010 have been reported on by the Group's auditors and contain an unqualified opinion.

 

The full audit report is contained in the Company's Annual Report, which will be available on the Company's web site by 30 November 2010.

 

2.

Critical accounting estimates and judgements

 

The preparation of financial statements in conformity with EU adopted IFRS requires the use of certain critical accounting estimates.  It also requires management to exercise its judgement in the process of applying the group's accounting policies.  The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

 

Impairments

Impairment reviews on non-current assets are carried out on each cash-generating unit identified in accordance with IAS 36 "Impairment of Assets".  At each reporting date, where there are indicators of impairment, the net book value of the cash generating unit is compared with the associated fair value.

 

On 6 January 2009, the shareholders approved the adoption of the investing strategy to acquire or invest in businesses or projects operating in the agricultural and associated civil engineering industries in Southern Africa.

 

Capitalised exploration and evaluation expenditure

The directors decided to suspend exploration activities and reduce expenditure to the minimum required in order to retain exploration licences.  Until the Company successfully resolves these and the uncertainties concerning its exploration rights in Southern Sudan, the directors consider that the value of exploration and evaluation and other related assets is impaired.  The impairment charge in the prior period comprises:

 


2010


2009


$'000


$'000

Impairment of exploration and evaluation assets

-


1,746

Impairment of property, plant and equipment

-


130

Impairment of investment

-


1,047

Disposal of inventory impaired in prior year

-


(135)

Impairment of other assets

-


47


-


2,835

 

Biological assets

Biological assets (cattle) are measured at their fair value at each balance sheet date. The fair value of cattle is based on the estimated market value for cattle of a similar age and breed, less the estimated costs to bring them to market.  Changes in any estimates could lead to recognition of significant fair value changes in the income statement.

 

3.

Discontinued operations

 

As set out in note 2, on 6 January 2009, the shareholders approved the adoption of the investing strategy to acquire or invest in businesses or projects operating in the agricultural and associated civil engineering industries in Southern Africa.  Consequently the oil and gas activities have been reclassified as a discontinued operation and this segment's trading results are included in the income statement as a single line below the loss after taxation from continuing operations with comparatives restated accordingly.  The Group has suspended all exploration activities and reduced expenditure to the minimum required in order to retain exploration licenses and extract potential value for shareholders.

 

The results for the discontinued operations are as follows:


2010


2009


$'000


$'000





Operating expenses

(1,227)


(1,463)

Other income

307


778

Operating loss

(920)


(685)

Finance income

-


1

Impairment of oil and gas interests

-


(2,835)

Loss before taxation

(920)


(3,519)

Taxation

-


-

Loss after taxation

(920)


(3,519)

 

Cash flows from discontinued operations included in the consolidated statement of cash flows are as follows:


2010


2009


$'000


$'000





Net cash flows from operating activities

(783)


(1,255)

Net cash flows from investing activities

3


(1,918)

                                   

4.

Earnings per share

 

The calculation of the basic and diluted earnings per share is based on the following data:

 


2010


2009


$'000


$'000

 

 

 

 

Loss for the purposes of basic earnings per share (loss for the year attributable to equity holders of the parent)

4,824

 

3,690

Loss for the purposes of basic earnings per share from continuing activities

3,904

 

171

Loss for the purposes of basic earnings per share from discontinued activities

920

 

3,519

 




Number of shares




 




Weighted average number of ordinary shares for the purposes of basic and diluted loss per share

515,129,499


352,921,478

 




Loss per share

0.9c


1.1c

Loss per share from continuing activities

0.8c


0.1c

Loss per share from discontinued activities

0.1c


1.0c

 

Due to the loss incurred in the year, there is no dilutive effect of share options.

                                   

5.

Share capital

 

 

 

Group and company

 


Authorised

Allotted and fully paid

Ordinary shares of 0.1p each

Number

Number

$'000

 




At 1 July 2008

1,000,000,000

350,132,688

641

Division of share capital

(155,000,000)

(155,000,000)

(238)

Increase in authorized share capital

1,500,000,000



Issue of shares

-

278,688,866

398

At 1 June 2009

2,345,000,000

473,821,554

801

Issue of shares

-

73,950,000

122

At 31 May 2010

2,345,000,000

547,771,554

923

 

Deferred shares of 0.1p each




At 1 July 2008

-

-

-

Division of share capital

155,000,000

155,000,000

238

At 1 June 2009 and 31 May 2010

155,000,000

155,000,000

238

 

 

Total share capital




At 31 May 2010

2,500,000,000

702,771,554

1,161

At 31 May 2009

2,500,000,000

628,821,554

1,039

At the Extraordinary General Meeting held on 11 November 2008, resolutions were passed to amend Article 4 of the Company's Articles of Incorporation to divide the authorised share capital of £1,000,000 into 845,000,000 ordinary shares of 0.1p each and 155,000,000 deferred shares of 0.1p each.  The deferred shares carry no right to any dividend; no right to receive notice, attend, speak or vote at any general meeting of the Company; and on a return of capital on liquidation or otherwise, the holders of the deferred shares are entitled to receive the nominal amount paid up after the repayment of £1,000,000 per ordinary share. The 155,000,000 ordinary shares of 0.1p each held by Nile Petroleum Corporation Limited were converted into 155,000,000 deferred shares of 0.1p each. The Deferred shares may be converted back to ordinary shares by resolution of the board once complete clarity of title can be given as to the Company's position within Block Ba or an acceptable position within a consortium to develop the enlarged Block B is granted.

 

The Company has one class of ordinary share which carries no right to fixed income.

 

At the Extraordinary General Meeting held on 21 January 2009, the authorised share capital was increased by 1,500,000,000 new ordinary shares of 0.1p each.

 

On 5 February 2009 the Company issued 200,000,000 ordinary shares of 0.1p each as consideration shares for the acquisition of DECA, Compagri, Mozbife and the associated debt from CAMEC plc.

 

On 5 February 2009 the Company issued 78,688,866 ordinary shares of 0.1p each for cash at 3p per share raising gross cash proceeds of $3.75million.

 

On 31 October 2009, the Company issued 63,950,000 ordinary shares of 0.1p each for cash at 5p per share raising gross cash proceeds of $5million to provide funding for the development of its agricultural activities.

 

On 23 December 2009 the Company issued 10,000,000 ordinary shares of 0.1p each as consideration shares for the acquisition of the 25% minority interest of the issued share capital of DECA, Compagri and Mozbife.

 

6.

Post balance sheet events

 

On 17 June the Company announced that it had entered into a farmout agreement with Africa Oil Ethiopia BV ("Africa Oil") relating to the Company's legacy interest in the South Omo Block oil concession in the Federal Democratic Republic of Ethiopia.  In consideration for assigning an 80% interest in the concession to Africa Oil, Africa Oil will fund a seismic work program (total cost of approximately $6.5m) and give Agriterra credit of $2.5m, to be set against future costs relating to the South Omo Block (excluding the seismic work program).

 

On 16 November 2010, the Company announced that it had placed 145,483,334 Ordinary shares of 0.1p each at a price of 3p per share raising gross cash proceeds of approximately $7 million to provide funding for the continued development of its agricultural, cattle ranching and feedlot activities.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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