Member Info for jk400

scoobydoo, welcome. The cashew facility is built and operating. It just started production the other week.

There are a couple of parts that they are waiting to arrive from abroad that have been delayed because of covid delays, etc. such as a colour sorter and something else. For now, they have managed to get things going using some local alternative.

They are going to ramp up to 10k tonnes initially. For no extra cost (by going to 24 hours shifts for workers) they will ramp up to 15k. From the profits of the cashew facility (and no more dilution, we have been promised that in several puff pieces!), they will then aim to double capacity to 30k, but I would assume that's at least a year or two away or possibly more. DYOR.

Thanks rugs for your contributions here. I think we're in a holding pattern for now with DKL as the market catches up with the fundamentals.

Although not a member, I occasionally take a look at what's happening on the other forum.

I note recently a comment from 'outlawinvestor' who is unhappy that 'some of these "long term", "knowledgeable" "investors" whingeing on the LSE threads' and that '100% full of whingers and whiners...'

The main point amongst said rant is that 'The 0.23% dilution [of Aris taking shares in lieu of payment] is hardly worth bursting a vein over...It's like rowing in the pub because a drop of water diluted your pint!'

Well outlaw, if you have something to say, then why don't you come and join the conversation instead of chuntering from a sedentary position?

In my experience, you'll certainly find engaging conversation from all contributors here. I personally want to hear the good and bad points of a company, not just the opinions of pumpers and dumpers - although we have had those here as well, i.e. troublingtimes/fundraiser222 et al.

I would respond though by saying that it isn't just 0.23% of dilution, is it? That's this month’s dilution, yes - what about the significantly higher percentage of dilution that I referred to in my post of 21st December? Do you have any comment to make on that? It may be true that the company is in a significantly different position now than what it was then, but so is the SP and investor sentiment - why is that?

outlaw also notes that 'I just can't understand why anyone would hold a company's equity only to spend forever and a day whingeing and whining...Isn't there an open market to sell if you're unhappy?'

So, in your opinion, a company can never be subject to any form of criticism from its investors?

'royalalbert' then responds to outlaw by saying that 'they [LSE DKL holders] are here for a bit of deramping hoping to buy in cheaper than the share is at present, you know this already.'

Incorrect. The SP is already on the floor and has been for years - as I, and others, have noted on numerous occasions.

Noting repeated mistakes is in no way deramping - if anything, the opposite is true. It is with the desire that the BOD will finally take the hint and pull their fingers out - in the hope that the SP will subsequently rise, i.e. what we all want.

PR, it's not moot when investors know we have a 70k tonnes per annum CPO facility - it's there in black and white in all of the old RNS's - yet, we are now being told in newer RNS's that it's 'only' 60k with no explanation for the apparent downgrade.

Re the 15k discrepancy, all the early 2020 RNS's refer to the development of a 10,000 tpa (expandable to 30,000 tpa) raw cashew nut ('RCN') processing project at Tiebissou in Côte d'Ivoire (the 'Project').

However, in the small print of the 3rd November 2020 RNS is this - "In line with this, the Cashew Project is undergoing a phased development and it is anticipated that it will have an initial annual capacity to process 10,000 tonnes of RCN. Phase 2 will target production at the plant increasing by up to 50% to 15,000 tpa within a 24 month timeframe. This can be achieved at no extra capital outlay by increasing the number of shifts of employees at the plant from two to three per day. Phase 3 of the development involves the targeted doubling of capacity to 30,000 tpa."

Rivaldo, this puff piece is the first I've heard of the 15k figure for cashews, so that is a welcome positive as previously all documentation as far as I'm aware stated 10k tonnes.

Having said that, there is still the CPO facility discrepancy of 70k vs 60k tonnes per annum.

There was a time when these puff pieces would move the bar northwards, nowadays the market reaction is just 'meh'.

If the board really do believe that "requests from a director to receive shares in Dekel rather than cash in settlement of remuneration in our [their] view represents an endorsement of the Company and its prospects", then said shares should be bought on the open market and then remunerated to Mr Achy Brou.

It says a lot that I was more interested in reading this particular RNS first, before the production update one.

Riptonk, welcome along and I hope you have a lot of patience as it's going to be tested here.

I agree with most of your sentiment, but as I have mentioned numerous times, DKL is not without its issues and many of them are self inflicted.

All are well documented on these boards, but to take your example about non risk takers. When I first invested here there were circa 150 million shares in issue. Today, there are 535 million and most of them have gone to the BOD. I once owned more shares here than Lincoln Moore himself, yet in the same timeframe he has quintupled (i think that's the correct word) his holding, yet only bought £10k's worth on the open market - the time when he said they "saw a lot of value" at 3.4p

We were promised no more dilution, yet it's usually the sting in the tail of every RNS.

We were told that the cashew facility would be up and running in Q2 2021. We gave them a bit of give and take because of supply issues, but here we are 9 days away from 2022, several missed deadlines later, and still no news on cashews.

Is it any wonder that holders have lost interest here and long since bailed out?

The BOD need to pull their fingers out in 2022 and stop relying on global CPO prices to prop up the financials.

Even our trump card of 'lack of liquidity' in times of high demand (i.e. when we got to the record of 20p) has been watered down so much that there is plenty of liquidity out there.

All the best for Christmas and the New Year to all the regulars on this board and looking forward to a better 2022.

Morning rugs, I believe your 3p average should hold you in good stead, especially if the 50 million cap mentioned yesterday is forthcoming in the next 6-12 months, followed by the 75-100 million cap down the line seems plausible based on the market not having taken in to account the cashew facility.

I missed the boat averaging down here, but still very happy to hold at these levels.

Re the capacity of the mill element. On the whole we have, I believe, a very good BOD. There have been some noteworthy mistakes but they have rectified them in a timely manner and hopefully lessons were learned from that.

The market has a very long memory though and you rightly mention the low current SP. That is almost certainly a legacy of past mistakes. The phrase once bitten twice shy comes to mind.

We remember with fondness the likes of troublingtimes and fundraiser222 (along with their many puppet accounts). For all their nonsense, they were right to bail out at twice the current SP several years ago. To get those sort of investors back on board, not that we necessarily want them but beggars can't be choosers, to get them back on board means a rebuilding of trust.

It is difficult to build trust when we are being told something that we know not to be true. Even more so when that wrong is questioned and doubled down on.

All of the old rns’s have the 70k figure, it’s still on the website as 70k, but on new correspondence we have this arbitrary lower number.

Would be interesting to hear your thoughts on this and hopefully from other long term holders.

rugs re the sell off, no news sorry. I assume just the usual boredom or maybe someone who bought in at the right time when we were at 1.7p or similar?

I myself bought another chunk earlier in the year against my better judgement and self-imposed buy in point of 17p. The conference call was quite upbeat I thought. Lincoln was talking about market cap doubling within next half year or so and then onwards to 75-100 million from current level of 25 million.

The answer to the 60k versus 70k annual production capacity I thought was somewhat bizarre. I will need to go back and listen again to the recording when it appears as I was somewhat taken aback whilst listening live. We may only ever reach 55k-60k per year, but why has there been no explanation for this anomaly?

Do we forward sell products?
No, we don't. Prices we sell at are essentially fixed at the start of each month. We haven't used hedging tools.

Broad question on cashew tonnage.
Already answered in the slides.

Can you comment on how cost of cashews is recovering from the fall last year?
Risen about 25% in last 3 months, so we've only been purchasing raw materials so there's a potential in our favour. (Sounds fairly small fry until next year when we get going).

Timing of third commodity?
They are leading to one in particular. In terms of timing, so much focus at the moment of high palm oil pricing and cashews at the moment. Conserving funds, so no investment in 3rd comm. for a while.

What is the plan moving forwards re dividends?
First priority is to bring debt levels down before any dividends. They would like to do, but growth and diversification first.

(60k tonnes versus 70k tonnes mill size question is next...)

Q - "Lincoln, there appears to be some confusion over the size of the palm oil mill, is it 60k tonnes per annum or 70k tonnes? The RNS's now state 60k, but used to say 70k."
A - "I would consider it as 60k tonnes." "We should stabalise in time at 55k-60k tonnes."

(That raises more questions than it answers)

Share price?
We've been slightly overlooked over the last 6 months. Seeing more and more news on the food side.

Interviews with Crux upcoming fairly soon, more commonly known to us on these boards as puff pieces.

More questions coming through, but they've run out of time. They will reply as necessary outside the conference call.

Closing comments.
Record half year.
CPO price materially higher, 4 months away from high season starting again.
Cashew business larger than palm oil, step up in profitability.
Next 6-12 months where DKL can break through a business that moves up to 40-45 million market cap.

Concludes.

Conference call highlights for those unable to listen live or if you missed it. Usual caveats and DYOR.

Recording of presentation will be available.

New style of conference call this time.
More of a Zoom style of meeting, live video of Lincoln.

Shai Kol won't be attending, he's on a flight to Cote d'ivoire so has been excused.

They are allowing live questions this time, unlike in the past.

Introductions for those new to the company, nothing we don't already know.

Progressing through usual slides.
H1 results, more detail later.

(Liking this new style of conference call, much more professional.)

They are doing some maintenence work on the empty fruit press action at the moment, in order to move extraction back to traditional levels.

Talking about equity raise and bond facility now.

"Probably the strongest position we have been".

Now discussing global prices, logistics challenges. Before Covid there were already low stock levels of palm. $1285 per tonne as of this morning.

"Potential, super high season coming up early next year".

Major producing countries, Indonesia/Malaysia supply continue being constrained over years to come".

Potential for even better H1 2022 than 2021!
Re cashews. It's been a slog recently, challenges sourcing raw materials and logistics for builing. First production within 50 days. Key milestone announcements over next 1-2 months. Scale up to full production in new year (February?). 3 or 4 critical months ahead of us re commissioning.

2 week old photos of cashew facility. Equipment in place, lot of room in warehouse because of starting out at 10k tpa with capacity to increase to 30k facility.

Processing 10,000 tpa of RCNs has the potential to generate 13 million euros in sales of whole / broken kernels.

30,000 tpa has potential to generate > 40 million euros in total sales based on current prices. See page 14 of presentation.

Social and Environment slide. Relationships with smallholders. School/Hospital renovation, water supplies. Very good.

RSPO certification now working through audit points. Call in next 1-2 weeks to see where we are in terms of readiness. We believe we are ready for them to visit and are trying to book the certifier to visit. "Very close to the finishing line".

Next 6-12 months.
High season starting in Mid January this year!!!
Possible improvement in extraction rate and empty fruit press.
Cashew key milestones of the company it will drive material step almost immediately from next year. 2-3 years time, stronger contributor than the palm oil operation.
Still looking in to other ventures to grow and diversify.

Concludes comments and now moving on to questions. Will follow...

There's another short director talk interview with Theo Bache from Arden.

I won't bother linking as it seems to redact, but it's searchable.

He says there's no change to their forecast, but it's clear "the market are valuing the palm oil business in its entirety and they are pricing that fairly. However, they are entirely discounting the cashew plant which, beyond the obvious merit of diversifying the business away from one single commodity, indicatively doubles the worth of the company on a future cash flow basis. We expect meaningful commercial output to commence in October."

One question I have for Lincoln on the conference call, and I hope he doesn't duck it, is why in the RNS's are they still referring to the Ayanouan plant as 60k tonnes per annum, when a 70k tonnes per annum was in fact constructed?

Q&A with Miton Head of Equities Gervais Williams on *************
https://*************.net/premier-miton-investors-on-positive-economic-momentum-and-sustainable-investing-lonpmi

"Q: Another one of your companies is sustainable producer Dekel Agri-Vision plc (LON:DKL) . They seem to be doing really well with record production levels, high palm oil prices, and soon to launch a high-margin cashew business. Now, it seems to be trading at a low price of 5p currently, what are your thoughts on that?

A: I think the issue about that is when you’re talking about some of these oils, palm oils and such-like, is that there’s real worries that we’re reducing jungle or wild forest to put up more production of these areas. In this case, Dekel Agri-Vision, which is not operating in Malaysia, it’s actually operating in Africa where they’re not removing forest at all, they’re taking areas which are largely not very productive and putting them into production to produce palm oil, and they’re producing in a very sustainable way. A lot of companies now are looking to only buy sustainable palm oil rather than palm oil from other areas.

All of this is good news because, again, it’s about addressing the mix between the needs for the global economy and the need for wild forest and all the diversity that comes with it so it’s very overlooked, I agree, and they’ve moved into cashew nuts, they’re taking cashew from local area as well.

So, it’s a company which is generating quite a lot of cash, and that’s the kind of characteristics we look for, we aren’t looking for companies which is just going to do something good, they need to generate cash so they can invest and ultimately grow their businesses and become more meaningful on a global stage."

This overlooked puff piece may have helped some of the recent buying - https://www.**********.co.uk/articles/alan-green-on-dekel-agri-vision-airtel-africa-argo-blockchain-1b827cd/

It seems like the presenter, Justin Waite, doesn't have a very positive view of DKL, unlike the contributor Alan Green.

I wonder why Lincoln no longer goes on this podcast nowadays?

Afternoon both, yes I have against my better judgement been doing exactly that, adding a few more here in recent weeks. We appear to have a relative floor level around 5p and the cashews yet to come. The CPO pricing appears to have largely been ignored, so happy to average down my holding to 11p overall and may even consider adding some more in time.

All looking good in today's RNS.

The only Gok Wanning, as FK1 would call it, is the 14.3% reduction in mill capacity as we still only have a 60,000tpa mill according to the RNS's, despite a 70,000 one having been built.

dbentley, the FFB collected record was Q1 2017 at 72,083 tonnes, Q1 2021 was 71,500, plus the 24,010 in April so we are not far away from record levels, but it looks like possibly the second or third best year rather than a record year.

Rotterdam dropped off in the week to $1250, but now back at $1355 according to https://palmoilanalytics.com/price/crude-palm-oil-cif-rotterdam/

Both of these charts have a delay of several days, but Rotterdam jumped to $1340 per tonne last week!

https://www.rea.co.uk/websites/reaholdingsplc/English/2450/cpo-price.html
https://palmoilanalytics.com/price/crude-palm-oil-cif-rotterdam/