Member Info for jk400

I, and assume others, missed this the other day.

Dekel Agri-Vision Limited

I like it, having advocated a move away from oil in recent months due mainly to the challenge explaining to people and their eyes glazing over as soon as they hear 'palm oil'.

In one of the conference calls, Lincoln said they were averse to doing so because of the strong name in Cote d'Ivoire, but it appears subsidiaries there will retain the name.

Morning all, in the recent conference call it was stated by Shai Kol that the produce of the DKL nursery are seen as the Rolls Royce of such plants (can't remember his exact words, but the local farmers clearly favour them compared with the competition) in Ivory Coast.

I see this as just getting the locals in another area used to the DKL name and working with the company. It may not be viable to move forward fully with Guitry yet, and the profits from this (second) nursery may be small change, but in the long run could (should) pay dividends. Did I remember correctly the current nursery produces a profit of circa €800,000?

As I've been away, a belated thank you to the 3 wise men for their usual excellent reporting from the AGM.

It was disappointing to see Lincoln again claiming a "9% premium to the last closing market price" is somehow "an endorsement". I regard it as an insult to loyal, long term holders here who are sitting on 60%-80% paper losses and therefore require a 300% premium to the last closing market price in order to break even.

It's now evident why the (often repeated) question of shares in lieu - during the recent conference call - was ignored/overlooked.

As for the business generally, it would appear not much is going to happen here until the cashew business comes on stream. In other words, another year of wait and see.

Morning all, I note they failed to answer the question on shares in lieu, although this usually gets a mention at the AGM!! :)

The bit about no default from farmer side (loans?) refers to those on the fertiliser programme. Shai Kol said not a single smallholder had defaulted, which is very positive news and it must be working well.

Re the SP not increasing of late, as we've mentioned before it is going to take a long time for confidence to return after what can only be described as a shambles of 2017, poor harvest of 2018 (not the BOD's fault, but didn't help) and now we have the CPO prices which again are out of company control, but it all adds up to a confidence building exercise needed to get things moving again.

On the positive side, levels of FFB's are organically growing and the fertiliser programme should give a big boost. It's just a case of patience now. This, alongside cashews and another round of debt restructure means it's a long term hold for me.

Expect recording will appear on DKL website later. It was about 30 minutes today, the bit about the DKL plants being the most popular in the country was interesting.

For those interested in RSPO certification looks like some point next year.

As hereandnow said the other week, it's about CPO prices now alongside the cashew project. It doesn't matter how much CPO is produced, if they're only breaking even then it's a long term hold for now.

Moving on to questions now.
Competition - how do they compare to DKL?
Poor quality on line.
Biggest player has 70% of the market.

Will company diversify (concern over CPO price)
Expect CPO price to increase in time. That's idea of cashews, to mitigate issues in other commodity.

3 other projects in mind that they're working on in the background.

Elaborate on Norpalm?
We didn't reach collaboration from the existing shareholder of Norpalm and decided not to continue. "A blessing in disguise because of difficult market conditions". We believe that Norpalm suffered from reduced CPO price and a very challenging period for them, even more than what we faced.

Difference of opinion on way forward (between DKL and Norpalm).

Guitry?
Waiting for completion of environmental study. Will only start developing once inspection is completed and then look for debt/equity partner. Intention to complete on a project level. "Will not include dilution at DKL level."

Cannot develop Guitry before RSPO is completed. "Believe we will be able to complete certification by 2020." "Held up by national interpretation". Final readiness for audit, difficult to estimate exact timescale, but no feedback we won't be able to achieve certification.

Profitability/Dividend
Resuming of dividend will depend on net cashflow - will evaluate once it becomes positive again. Depends on CPO price, looking to restructure debt which will free up cashflow. Need to wait to see how cashews are going.

Business conditions in Ivory Coast
A very good country to do business in, one of best in West Africa. Very good legal infrastructure, level of education. Quality of machinery and general. Massive development in the last 10 years, roads, water, basically in all levels. Still room for a lot of development.

Taxation, still have 10 years more of tax exemption. 13 more on cashew side.

Upcoming news flow?
Debt structure - looking forward to. Been working on since Q3 2018.
Half year results - September
After rainy season - formal commencement of cashew construction phase.

Next conference call?
After annual results
After half year results - back end of September
Full year production - early January

AGM - Tuesday 23rd July.

Exciting where the business is heading. Wrapping up proceedings.

Referring to PDF presentation on DKL website.

Expecting to see dramatic pick up in CPO prices, not sure exactly when.

Moving on to cashew project now. Overview.

Started work on groundworks, main construction to start after rainy season (which ends in Aug/Sep). Expect to start cashew processing "next year". Flow of announcements to come through on the back of that.

Vision, next 1-3 years.
2018 very difficult year.
FFB back to normal level in 2019. We did not lose market share. Continuing to work with smallholders.
CPO price remaining challenging factor, but expect to increase.
Relation with smallholders. Continue to strengthen relations. No default from farmer side (loans?)
Very good relations with smallholders.
Continue to grow to leading agri industrial player.

Running commentary of conference call for those unable to listen live. Usual caveats, the lines are often poor quality.

Just going over a bit of history to begin with, increasing collection facilities, etc.

"2019 is a much better year in terms of fruit production". Shai Kol

38% increase on fruit collection. Continuing to invest in cooperation with local producers. Talking now about fertilizer programme. Teaching the farmer what they can do and how to use the fertilizer. Aiming to roll out to all farmers, "should increase production dramatically". Nursery still performing well. "Dekeloil plants are the best brand in Ivory Coast" - "very strong demand" for DKL plants. Huge planting over last 7 years, fertilizer key to increasing production.

More to follow.

Excellent Q2 results, but we're entirely dependent now on global prices improving. As long as FFB's continue to increase, we are well placed. Still a (very) long term hold with buying on the drops.

https://www.youtube.com/watch?v=TLwEMVhRrJE

List of questions sent for next week's conference call. Would be interesting to see others.

Lincoln, thanks for answering questions again.

Why does Dekeloil not release and adhere to an annual financial calendar for results dates, production updates, AGM, etc.? I note these are not compulsory for AIM companies, but to voluntarily do so would be a positive step in my opinion.

Could you please tell us more about the local competition in Cote d'Ivoire, and how they compare with Dekeloil?

In a recent RNS, you stated that once the cashew business comes on stream, "our quarterly production updates will cover not one, but two producing projects". With the ongoing complaints about lack of regular news flow, would it not be prudent to split these announcements for separate months, i.e. Palm Oil, Jan/Apr/Jul/Oct, with cashews a month later?

Is there an exact date for when construction will begin for the cashew mill and a date for completion? Also, how long after completion will production commence?

I note in last week’s RNS any remaining interest in Norpalm has finally been dropped. Are you now able to elaborate further on what happened?

A constant bugbear for many private shareholders for a number of years has been the persistent issuing of shares in lieu, yet this continues to happen. Are you able to provide more details in to the decision to keep doing so?

Will there be a dividend this year or when do expect this to be reinstated?

The increased social media activity is most welcome. Could you please ask the website people to embed these feeds directly into the main website.

When will the next conference call be?

Latest puff piece - https://www.youtube.com/watch?v=0Wiw_LEYs_U

A lot of regurgitation, but some new snippets:

During 2018, minimal to no milling disruption. More extensive maintenance programme late 2017, €600,000 (Euros) which was a one off cost. Abnormal, done to firm up the mill after 4 years of operation. Mill operated well. Costs should return to normal this year.

10% taken out of fixed overhead level. Continued decrease in overheads in 2019.

Mentioned the fertilizer programme again, which sounds interesting. Potential to double output. They've had a test programme and are trying to roll it out on a more substantial basis.

Looking to rebalance debt structure. Working on long term finance for a few months now.

Cashews - construction of mill about to begin.

Within 12 months "we're going to be a substantially larger business".

"Market conditions for fruit have improved materially" (so far in 2019) - talking about releasing H1 (Q2) figures "next week" - puff piece was recorded on 27th June, so that suggests this week!

"Fruit improving, material costs returning to more reasonable levels". "Look forward to announcing production numbers next week." We've intentionally set our shareholder call to be following that" - details, questions, etc. on website/RNS. AGM later in July.

"Back next week" - so another puff piece as well, hopefully.

Morning cat, indeed they claim earlier/later doesn’t make any difference, yet from experience we know that the closer to the 10th generally means good news and the nearer to the 17th means they are employing the services of Gok Wan to coin fk1’s saying.

I am compiling a list of questions for the conference call and will post here in the next few days.

From rivaldo on the other forum:

Comment from VSA Capital not posted here before about the cashew nut financing (and the new substantial shareholder): https ://www.proactiveinvestors.co.uk/columns/vsa-capital-market-movers/30948/vsa-capital-market-movers---dekeloil-30948.html Conclusion: "VSA Comment Existing project investor Concordia has increased its stake in the Tiebissou cashew project to c32.9% at the same nominal valuation that DKL made its own investment last December. However, due to DKL issuing shares at a premium to acquire its stake, its effective deal valuation was lower (c€4.2m). This additional investment further endorses the value of the project and will permit the drawdown of the already-agreed development loans. We now estimate the project could deliver an additional c€2.2m in attributable profit to DKL by 2022 (assuming the option over the additional 17% is exercised). Following the increased trading volume in the company’s shares last week we also note last night’s TR-1 announcement detailing the acquisition of c.13m shares (c.3.7% of shares outstanding) by a New York-based high net worth investor. This supports our thesis that the company is fundamentally undervalued at its current share price. We maintain our BUY recommendation and target price of 12p."

Thanks rugs, I had overlooked yesterday's RNS and the report you mention on the website is very interesting.

I note this bit re Norpalm, which has finally been knocked on the head - "In addition, 2018 included a one-time write off of €151,000 (Euros) incurred in 2016 and 2017 in relation to the potential acquisition of Norpalm AS. We have ceased our interest in Norpalm AS. and are now focusing on opportunities in Côte d’Ivoire, including cashews."

Good to see a conference call scheduled for a week on Monday (8th) at 2pm with Youval Rasin (CEO) also taking part for first time. The RNS also mentions "....who will discuss the final results together with the 2019 half year production results which the Company intends to announce in early July 2019." - which suggests that the H1 results will be forthcoming on or before the 8th July.

"Conference Call
To participate in the conference call to be held at 2pm UK time on 8 July 2019, please dial 0808 109 0701, (if you are calling from outside of the UK, please dial +44 (0) 20 3003 2701) and enter participant pin 1144511# when prompted to do so. Please note that all lines will be muted with the exception of Company management, however the Company invites shareholders to submit questions to its public relations adviser, St Brides Partners Ltd, ahead of the call via email. Questions should be sent to shareholderenquiries@stbridespartners.co.uk"

Afternoon both and others, VSA have reiterated buy this morning at 12p target.

Just the 300% increase required then in order to get back to many break even points. Good news required in a fortnight.

I've noticed we nearly always see a fall like this a month before the quarterlies. It's like people are getting mixed up with RNS dates, not seeing anything and then panicking.

It's why DKL should have an investor calendar for trading updates/preliminary results, etc. - you know, just like most companies have!

It would also put a stop to any form of window dressing. They say it will be around the 10th each month, so why not just make it the 10th (or first Monday after) every January, April, July and October? Then, put it on the website alongside dates for prelim/full year results and AGM. Very simple.

There must be a large unreported buy in the background as someone on the other forum says it wasn't possible to buy any online yesterday. From experience with DKL, we know this 15% rise does not correlate with the small volumes reported up to now.

There appears to be a concerted effort, at last, to increase news flow. The Twitter feed is being updated several times a day, it looks like they met Tony Blair for something the other day and more pictures/info on FFB's. Some regurgitation, but not a problem as some may of missed previous news items.

Lincoln, it may be helpful to ask the web people if they can embed the live twitter feed on the front page of the website. I don't think there's even so much as a link to the twitter page on there at the moment, so that alongside live updates would work very well.

There's a video on now of the nursery and mill.