n 1Q2013, Okomu Oil’s
revenue was down by
~35.0% y/y to 1.838billion
from 2.827billion in
1Q2012. A breakdown of
the company’s revenue
during the period
indicated that domestic
sales contributed 50.9%
to total revenue whilst
exports contributed
49.1%. Okomu Oil’s
strong domestic sales
levels show that the
company is less
vulnerable to oil palm
price shocks in the global
market.
In the face of the
strong decline in sales
revenue in the review
period, cost of sales
increased by 43.7% y/y
to 638million in 1Q2013
from 444million in the
corresponding quarter in
the previous year. Rubber
constituted 325million
~50.9% of the cost, while
the remaining 312million
i.e. ~49.1%, was with
respect to oil palm
production.
Margins depressed on
the back of low
commodities prices.
The price of oil palm in the
global market moved
downward in the review
quarter by 26.3% to an
average of US$780/metric
tons compared with an
average of US$1,058/
metric tons in the same
quarter in previous year.
We believe this also
contributed to the y/y
decline in sales revenue.
Total overheads
declined 11.8% y/y. Net
operating expenses
retreated by 40.4% y/y to
512million in 1Q2013
(1Q2012: 859million).
Overall, total overheads
declined by 11.8% y/y to
1.150billion in1Q2013 from
1.1303billion in 1Q2012.
Decrease in
investment income
impacts profitability.
The company reported a
decline of 98.6% y/y in
finance income to
0.25million in 1Q2103
from 14million in 1Q2102.
This represents interest
from fund placements
with financial institutions
in the review period.
Similarly, interest expense
declined by 86.3% y/y to
1million in 1Q2013 (1Q2012:
11million); this was a result
of part repayment of long
term loan obtained from
its off-shore lenders
within the quarter.
In addition, Okomu
obtained a 2billion
Agricultural Loan from a
domestic financial
institution in the review
quarter. This was used to
finance both working
capital and non-current
assets. From the
foregoing, we expect
moderate growth in
interest expense in the
months ahead.
Our valuation puts
Okomu Oil’s target price
at 41.42. This is lower
than the closing price of
51.02 on 15 May 2013;
however, we maintain
our HOLD
recommendation on the
stock.

They are thief that just keep on declaring paper profit not even robbing peter to pay paul. When i predicted these in another tread i was called all sorts of name. When i visited their farm what i saw was shoking they dont have anything presco is far more richer than them.

I don't know what you saw at Okomu Oil Plantation but part of this report:https://www.nairaland.com/1304509/presco-vs-okomu-oil-shares http://thenationonlineng.net/new/business/presco-vs-okomu-oil-same-weather-different-planters/

states,

".....Okomu Oil Palm, the older and the larger of the two companies,....."

However, it will be educative to have the unbiased views of other people that have visited both plantations. Also size may not necessarily equate to production capacity/actual output (though plausible in some cases) in modern day agricultural practices with the use of genetically modified methods in crop production.

Peterwins: I don't know what you saw at Okomu Oil Plantation but part of this report:https://www.nairaland.com/1304509/presco-vs-okomu-oil-shares http://thenationonlineng.net/new/business/presco-vs-okomu-oil-same-weather-different-planters/

states,

".....Okomu Oil Palm, the older and the larger of the two companies,....."

However, it will be educative to have the unbiased views of other people that have visited both plantations. Also size may not necessarily equate to production capacity/actual output (though plausible in some cases) in modern day agricultural practices with the use of genetically modified methods in crop production.

how i wish investors could be allowe to visit these company.