Member Info for jk400

Rivaldo, where do you source your palm oil price please, as Palmoilanalytics have Rotterdam prices jumping to $970 and $975 for the last two trading sessions after the Indonesia news?

Prime and Pickling, we'd all like to see that day, hopefully sooner rather than later.

Yes, things are looking better now than at any point over the last 2-3 years, but it's difficult for LTH's sitting on 80%-90% paper losses to get excited when the SP rises by a few percent to 2.55p.

LTH's here have seen it all before - pumping/dumping, puff pieces, gok wan window dressing, shares issued in lieu, dumper dude/gatherer guy, sunshine and jam tomorrow RNS's, a BOD who can simultaneously be geniuses yet asleep at the wheel - you name it.

There is nothing new in any of the RNS's and/or puff pieces seen in 2020 that we didn't see in 2014/15. If anything, it's mostly regurgitated word-for-word, apart from the cashew business. As such, there is certainly an element of sarcasm in the thread, but that's not because anybody is talking the company down, it's more light hearted fun and somewhat of a long running joke.

There needs to be consistent positive news over a very long period of time before the SP gets moving. If you're only here for good DKL news, you're going to be disappointed as bad news is always around the corner somewhere with DKL.

This is a very long term hold, at best, no matter how much enthusiasm you have for the stock - and be in no doubt all contributors to this thread have incredible enthusiasm for DKL (and a lot of patience!)

Thanks, but we're still none the wiser from that puff piece as to when exactly "high season" is.

Within 3 minutes, it went from "March to May", then to "we move soon in to our high season for next year" (November/December?) to "the key now is that the price locally starts to pick up around Mid January, when we start our high season".

Primerate, unfortunately DKL have been using the "premium to the closing price" card for years now, even when we were around 10p-15p, they were saying it was confidence from suppliers to be paid as such. I wonder how they feel now with the 80%-90% drop off in the SP over that time?

Picklingvinegar, that will no doubt be due to (not for the first time, nor the last time) 28,551,800 additional shares being issued in lieu. They keep telling us no more dilution, but it keeps happening.

dbentley, not sure if you've factored in to your calculations that in 2016 we only owned half of the mill?

Thanks all.

Primerate, in your notes do you have anything there to do with this part:

"Approx. 170,000 hectares within reach of mill logistics. 6,000 new planting over last 7 years. Reasonable to assume that fruit levels will increase by 30%-50% over next few years because of increased planting. More than half of new plantations since 2015. New plantations are coming in to first year or so of producing fruit, so sounds like next year or two for that new stock to start coming through."

If they're expecting 30%-50% uptick in fruit levels, then the 6,000 figure quoted there over the past 7 years can't be right for new plantations?

Will we continue with monthly updates instead of quarterly?
Yes, at least until the end of the year.
(I think he mentioned next Monday there for the September figures, but don't quote me on that).

Concludes questions.

Thanks to everyone.

Any questions, send to Lincoln or Shai anytime.

Really exciting next 3-6 months.

Ends.

They are able to keep track of individual source of each batch of FFB. Couldn't quite make out what benefit is of this, but I guess it must of some use.

Usual question next on RSPO, usual answer, still waiting.

Has covid impacted operations at the mill or smallholders?
Answer: Followed all guidance, no impact on day to day operations. Country as a whole, a lot less disruption than in other places. Going forward, we think operations will continue as normal for us, continue to follow guidance. Relatively normal.

Affect on smallholders - doesn't think so. 2-3 hours outside central business district, so minimal affect out in the countryside.

Doesn't think there's been any material affect due to covid other than mentioned earlier with CPO price.

Construction of cashew plant?
Coming along very good.
Equipment on site.
Utilities being installed at moment.
Somewhere in Q2 2021 to be complete.
As mentioned, pictures on social media up to now and moving forward.
Aiming for 10,000 tonnes of raw cashew to begin with. Maybe slightly higher.
Arden Partner's latest company research is available on home page of website.

Why are we waiting before expanding to 30,000 tonnes?
Want to first learn the market before additional spending and assess to the business.

Gross margin of cashews vs palm oil?
Cashew business will achieve better gross margins. More control over buying vs FFB. Internal costs including staff numbers significantly lower.

Which commodity next?
Focussing mostly on existing business and cashew at the moment.
Low cost work and research on 3rd commodity.
3rd commodity likely to be clean energy at this stage, but subject to change.
Conversations ongoing with government, permits, contracts, etc.
Proceeding cautiously at the moment.

Cashews next, Slide 13
Back to Shai Kol
Pictures from the construction site.
Most of machinery on site.
Updates on social media as things progress.

Not much substance there, quickly moving on to questions now.

Supply in Malaysia very low at the moment, positive for us.
Major buyers, China & India, CPO stock levels well below what they usually hold.
EU similar stocks as normal, neutral there.
Main risk to CPO price is further shutdowns globally, otherwise should stay around current levels or increase.

Next question is improving extraction rates.
Reason for change is quality of the product on local fruit.
Will definitely be higher than last year.

Market share of fruit from smallholders.
"We maintained market share this year", improved logistics and subcontractors enabled us to be more efficient. Continuing fertilizer programme, pay on time to smallholders and improve relationships with them. It's been a challenge to increase market share in recent years, but have maintained market share.

Approx. 170,000 hectares within reach of mill logistics. 6,000 new planting over last 7 years. Reasonable to assume that fruit levels will increase by 30%-50% over next few years because of increased planting. More than half of new plantations since 2015. New plantations are coming in to first year or so of producing fruit, so sounds like next year or two for that new stock to start coming through.

Usual in-play highlights from the conference call for those unable to listen live, DYOR, etc.

They usually upload the recordings of these to the website over the following few days and some bits are often missed due to poor audio quality on phone lines to Shai Kol.

Agenda:
Overview of interim results, exciting next 3-6 months.
Slides, presentation first. It's on website to follow through.
Questions.

Shai on first, brief overview of results. Slides 5 & 6.
Improved all metrics despite challenging environment.
Two main reasons for improvements - CPO global price, improved extraction rate.
In terms of cashew project, on track, progressing.
More details during Q&A.

Slide 7, background to results over 6 years.
Lincoln drawing attention to CPO price, best year was 2017 (when CPO was $700)
Weren't disrupted by Covid, but cost the business circa 1.2 million (assume Euros) because of drop in CPO price.

Slide 8, what happened to CPO pricing.

dbentley, I think many of us first became aware of the company after seeing this - https://www.thisismoney.co.uk/money/investing/article-3065545/MIDAS-SHARE-TIPS-Palm-grower-DekelOil-oils-wheels-production-set-soar-1p-share-price-follow.html

Talking there about profits of "€2.7million (£2million), soaring to €7.4million in 2016".

Very good, and Gok Wan nowhere to be seen fk1!

We now need consecutive RNS's like this over an extended period to get the SP back to 'normal' levels.

"for investors patient enough"

lol, it should have said for investors with the patience of a saint!

At least CPO is now hovering around $725 - $775.

dbentley, I am in a worse boat alongside you. Ouch.

Some of the DKL problems are bad luck, some of it incompetence. There's been something every year, COVID, bad harvests, schoolboy accounting errors, mechanical failures, all of it combined to drive the SP down.

Personally, I think it's been oversold for some time now, but there's never been enough good news and more importantly good news for consecutive quarters to drive it back up again. We are just treading water at the moment.

They keep going off on too many tangents instead of focussing on getting fruit through the door. That rubber expert is a good example, he left not too long ago, but nothing ever came of it. The cashews need to be a success from day one.

Nothing is going to happen until a sustained return to profit. The CPO price is now in our favour, unfortunately we're currently in low season so we need these higher prices to remain in place for years, not weeks. It needs a combination of the dividend reinstating, directors dealing in the market and stopping the issuing in lieu. Back to under promsing and over delivering, not the other way around.

I still have confidence, but this needs a lot of patience.

CPO back above $740 yesterday.

They've got some pictures of construction on the twitter page. Not much social distancing going on though.

An immediate moratorium on the issuing of shares in lieu would be most welcome and perhaps even get things moving back in the right direction.

If these 'advisors' insist on being paid in shares - goodness knows why, when they keep reducing in value - then they should be bought on the open market.

We also require the BOD to put their hands back in the pocket. Not just for £10k of shares, but on a substantial scale this time. They said they "saw a lot of value" at 3.6/3.85p, then these prices are at 50%, or to put it another way, BOGOF.

My hand has almost clicked to buy more at these ridiculously low prices on several occasions in recent months, but fortunately I have always pulled myself back from brink and reminded myself of FK1's historic and long held next buy in point of 17p.

Just a rise of 691% required from todays close for that! We're still a 70% rise away from where Lincoln and the board "saw a lot of value" at 3.65p

FK1, funny you should mention that as resolution 5 on the agenda at the AGM in Cyprus this year (so no wise men to hold them to account) is "To authorise the Directors to allot shares and options and the disapplication of pre-emption right".

I think that one is a given, both in terms of it passing and it being subsequently used.

Resolution 6 is "To authorise the Directors to make market purchases of own Shares". At first glance, why even bother with this, as the last time they put their hand in their own pocket was at 3.8p when "they saw a lot of value". On that basis, at 1.7p they should be piling in. Maybe they are waiting for your long time 1.7p buy in price FK1! Although, that would be 17p in new money. :(

I believe that sale of 1.71p is the lowest price in history and 1.85p will equal the lowest closing price.

Not sure why as Rotterdam CPO up again yesterday to $725 and keeping a close eye on the COVID-19 numbers in Ivory Coast, they are (touch wood), keeping it under control.

This sell off can only be people getting bored of waiting for the promised land to appear.