31 Mar 2017 07:00
Anglo African Agriculture PLC - 1st Quarter UpdateAnglo African Agriculture PLC - 1st Quarter Update
PR Newswire
London, March 30
| 31 March 2017 |
Anglo African Agriculture plc(“AAAP” or the “Company”)
101% GBP Revenue Growth for the Quarter ended January 2017andAAAP Completes Capacity Expansion at Food Manufacturing Plant
Highlights:
Revenue increases by 53% to South African R10.64 million in food manufacturing for Q1 Y/E 2017 vs Q1 Y/E 2016 (101% on a GBP basis). Tonnage of food flavourings increased by 6% to 303 tonnes Q1 2017 vs Q1 2016. Production capacity now more than tripled at AAAP’s South African spices manufacturing facility with installation of new milling equipment. Strong customer demand continues to exceed factory output. New spice product ranges launched in 2017 gathering traction.David Lenigas, the Company’s Chairman, commented:
“The Company’s business is growing very strongly now and we continue to see increasing customer demand for our specialty spices, food additives and seasoning. Orders continue to exceed the Company’s ability to meet demand for Dynamic’s products supplied for the mass food manufacturing sector. Going forward, the operation of the new machines significantly boosts our future manufacturing capacity and should substantially reduce our overall unit operating cost and boost our competitiveness as we move towards much bigger turnover and product range offerings. We need more stock to meet customer orders and we are working hard to quickly address this issue.”
Anglo African Agriculture plc (LSE: AAAP), the London Main Board listed food manufacturing company, is pleased to advise that our 100% owned Dynamic Intertrade (Pty) Limited (“Dynamic”) spices and seasoning manufacturing business has achieved a solid growth in quarterly revenues with the first quarter of Y/E 2017 (Q1 beginning 1 November 2016 and ending 31 January 2017) reaching South African R10,639,486 million (£620,461) an increase of 53% year on year versus Quarter 1 Y/E 2016 and a 101% increase in GBP terms. This was due to an increase in South Africa Rand revenue coupled with a significant weakening of the GBP vs the South African Rand. Processes tonnes through the factory also increased by 6% year on year with Q1 2017 achieving 303 tonnes.
In addition, the new milling machines designed to triple the production capacity of its spices manufacturing facilities in South Africa, have now been installed and are operational. These new manufacturing machines will significantly reduce operating costs going forward and add significant new production capacity to meet the rapidly increasing customer order book for the Company’s bespoke spices and seasonings and food flavouring additives used in many sectors of the mass food manufacturing sector.
Manufacturing Capacity Expansion Complete:
Production capacity of AAAP’s 100% wholly owned food manufacturing and marketing business, Dynamic, has now commissioned the new 250 tonne per month milling machines. These new machines require significantly less clean-out time between batched of different spice blends and is expected to reduce the electrical power consumption of the factory by an estimated 50%.
Previous milling was primarily limited to a monthly capacity of only 80-90 tonnes per month of a limited range of soft spices such as paprika and chilli. The new mills are well suited to the fine grinding of coarse and hard spices such as peppercorns, nutmeg, pimento, mustard and coriander, which will add new spice blends to the factory’s product lines.
The old production lines will be kept in a production ready state, on a full care and maintenance basis, to provide additional back-up support in the event of unscheduled downtime of the new plant and also provide overall production capacity up to 350 tonnes per month as the business grows.
Order Book and New Product Lines:
Dynamic has secured a further 60 tonne supply order for Cayenne Pepper for the canned fish Industry for a major canning company, adding to the substantial 300 tonne Cayenne Pepper order for one of the largest tin fish canners announced on 13 February 2017.
2017 has seen good growth in Dynamics’s ‘Batch Pack’ custom blended spice ranges for major South African processed meat manufacturers, for the manufacturing of sausage and mince extended products aimed primarily at the lower end of the mass market with February orders building to 17 tonnes. The new range of value added customer specific seasonings (Thundergun Grill and Chakalaka), launched at the end of last year, is accelerating appreciably through a well known South African restaurant chain. Dynamic’s traditional Biltong Spice (for dried meat) is also growing.
New product ranges now include pepper sauce seasoning for the meat pie industry, with first orders supplied this month, and seasonings for the tomato sauce and the instant noodle manufacturing sectors.
About Dynamic:
Dynamic is based in a modern 3,000 m² FSSC compliant facility in Cape Town, South Africa and is involved in the importation, milling, blending and packaging of food products for the food manufacturing sector with bespoke lines that include herbs, spices, additives and seasonings for both the domestic and export markets.
For further information, please contact:
| Anglo African Agriculture plc David Lenigas, Non-Executive Chairman Rob Scott, Non-Executive Director | +44 (0) 20 7440 0640 |
| VSA Capital Limited (Financial Adviser and Broker) Andrew Raca | +44 (0) 20 3005 5000 |