(Alliance News) - Dekeloil Public Ltd said Thursday it swung to a loss in 2018 as a poor harvest season led to a drop in crude palm oil production and prices.
The West Africa-focused agricultural company said pretax loss for the year stood at EUR3.2 million, compared with profit of EUR1.7 million the year before. Revenue dropped by 30% to EUR20.9 million from EUR30.2 million.
The average crude palm oil selling price for 2018 was EUR542 per tonne, down from EUR680 the year before.
Production-wise, Dekeloil's Ayenouan palm oil project in Cote d'Ivoire dropped by 15% to 33,077 tonnes of crude palm oil from 38,736 tonnes the prior year, due to a poor region-wide peak harvesting season in the first half of 2018.
Meanwhile, the company said it is progressing with the development of the Tiebissou cashew processing project also in Cote d'Ivoire.
So far, Dekeloil has acquired an initial interest in the project, and has secured an option to raise this to a majority interest.
Looking ahead, Dekeloil said it expects its 2020 financial performance to see a "material increase" in revenue and profitability from its palm oil business, as well as a contribution from its Tiebissou cashew project.
"As previously reported, 2018's unseasonably weak peak harvest and cyclically low global CPO prices conspired to end the run of record full year results we had maintained since our admission to AIM in 2013. Although CPO prices are yet to recover, 2019's peak season saw yields materially increase and as a result, pressure on FFB costs has to a material degree subsided," said Executive Director Lincoln Moore.
Shares in Dekeloil were down 3.8% at 3.08 pence on Thursday.
Dekel Agri (DKL)