M.P. Evans Group PLC (MPE.L) Earnings Call Transcript & Summary

Good afternoon, and welcome to the M.P. Evans Group PLC interim results investor presentation. [Operator Instructions] The company may not be in a position to answer every question received during the meeting itself. However, the company review all questions submitted today and publish responses where it's appropriate to do so. Before we begin, we'd like to submit the following poll. I'd now like to hand over to Peter Hadsley-Chaplin, Chairman.

Thank you, Paul, and good afternoon, ladies and gentlemen. Thank you so much for taking the time. And I have to say this is real sad time to hear presentation following the interim results that we announced to the market yesterday. I'm pleased to say we have full executive team present in the form of myself, Chairman; Matthew Coulson, who is our Chief Executive; Luke Shaw, who just -- very recently on the 1st of July, joined us as our new CFO. And we have Chandra, who is at his home actually, even in Malaysia, who is in charge in Asia of our -- running our Indonesian operations. So we plan to take you through the presentation, which we hope will try to restrict to about 30 minutes, keep the whole presentation to roughly an hour, which will give best part of, we hope, 30 minutes for any questions, which we've delighted for you to ask. So without further ado, I'll kick off. Just you see that emblem on the top right of that picture of our plantation, we strangely enough, we're not absolutely sure of the founding date of M.P. Evans because all the records were destroyed in the war. But nonetheless, we know it was in the early 1870s that we've chosen to commemorate that time over the course of the next 12 months in various ways, which are still to be sort of fleshed out. Next slide, please. That is the agenda, which you can have already cast and I over, but we will move straight to the next slide, which is who we are. Many of you are familiar with who we are, but a number of you perhaps are not. And as I just indicated, we're a 150-year-old company. We've always been in the plantation business, we're enlisted. And in the last number of years, really best part of 20 years, we've increasingly focused, are producing sustainable Indonesian palm oil and have expanded very rapidly in that area -- in that period of some 15 to 17 years. And we now employ more than 10,000 people and responsible for looking after many more people in terms of their families who we house on our plantations. In terms of what we now have established, it's around 40,000 hectares of our own group-owned plantation areas. And a further 12,500 hectares, which we manage on behalf of our associated scheme smallholders, which are adjacent to our projects and have managed to exactly the same high standards as our revenue, the two of which were indistinguishable. We've invested over $0.5 billion in expanding our Indonesian business since 2005, where we took the decision to sell the small Malaysian states which we owned and use the proceeds to expand substantially into Indonesia. And the RSPO coincidence was formed around that time. And we have, of course, always operated strictly by the principles and criteria, and Matthew will elaborate more on some of our ESG initiatives and measurements later. And these are our -- they're not just empty words. These are our four core pillars, if you like, which are all very important to us. And they all link in a sense, one with the other. We've touched -- I just touched on responsibility, which not only be concerned the e-side, the environmental side where that is absolutely fundamental that we don't, for instance, see forest, clearly not nor burn, we treat the environment very sensitively. But also the social side in terms of the high-quality housing, the new schools that we built, the teachers, medical facilities that we have. These in turn will help to attract the best quality managers and staff and encourage them to stay with us. And therefore, this leads to an excellent quality of management. And through that excellent management that helps towards achieving better growth through increasingly sort of better agronomic practices, which help to improve our yields and our yields are also improved through two other sources, one through the very fact that our plantations as an average are still young. And so every year, they're getting more mature and the crops and the number production are growing as a result of that greater age. But also, we are now very much on the lookout to acquire new areas. So by virtue of the inorganic growth, if you like, by buying new areas, we would increase our production. And this in turn feeds through to the final of the fourth of our pillars, which is out of yield. And here, we mean dividend yield, returns to shareholders and we will later show how important this is to us at the bar, I think, rather impressive track record when it comes to dividends. These are just -- well, the highlights of our results, I'll just very briefly touch on these -- each one of these points will be elaborated on. But very quickly, our group crop was increased by 4%. It will be explained as to why it wasn't a greater increase than that as we are growing. But for the first half, it was a 4% increase because the reasons which will be explained the amount that we bought in from the independence smallholders was lower, it balanced out and resulted in an almost exact same level of CPO production for the first half, although that is now increasing in the second. The average price for the first half, the reasons which will be explained, was fantastically strong 43% increase. And pleasingly, back to the sustainability theme, a 74% increase in our sustainability premium. There were increased costs, which Luke will touch on shortly. But nonetheless, there was a 49% increase in our operating profit and a 65% increase in our earnings per share, a 25% increase in the dividend has been decided by the Board, namely an increase from 10p per share to 12.5p per share. And we've also pleasingly turn around the debt on our balance sheet that we had last year to a net cash surplus. Perhaps I can now hand over to Matthew to talk initially about the palm oil market.

Thank you, Peter. So I think it's important to just to set everything in context by looking first of all, in a bit more detail at the palm oil market in the first half of 2022. And perhaps it's best, first of all, to focus on the graph in the bottom half of that slide. And we look back, first of all, to 2018, '19 and '20 to remind ourselves of where things have been before looking then at the first half of 2022. And we can see by looking back before looking at the first half of '22, it reminds us that actually the first half of this year really has been a remarkably high price environment for palm oil. The average Rotterdam price has been over $1,600 per tonne in the first half of the year, up 45% on last year, which we can already see, there's a rising in a high price situation in itself. So to be over $1,600 per tonne as an average is really quite remarkable in a historic sense. Now why is that? We look at the chart again that we can see there was a point in late February and into early March, where that chart actually becomes almost vertical. And that really is a reaction not just in palm oil, but in a number of commodities and certainly in a number of vegetable oils to what was going on in Ukraine and with the outbreak of war, their concerns over supply of vegetable oils, concerns over what might be happening with the supply, particularly of sunflower oil with Ukraine supplying almost half of the world's sunflower oil. And so we saw a very sharp reaction in pricing for palm oil with Rotterdam prices, very nearly reaching $2,000 per tonne in the peak was actually $1,990 per tonne. So average Rotterdam prices over $1,600 per tonne, and that mean average mill gate prices for us, what we actually received for our production in the first half, averaging over $1,000 per tonne, $1,035, quite remarkable pricing. And as it says there, and as Peter mentioned, 43% up on the same period last year. And again, looking at the chart, you can see that already was in a rising very high market even in 2021 to see another step-up of that magnitude in 2022 was quite a remarkable pricing environment. Now inevitably, in such a high-priced environment, we saw some changes made by the Indonesian government to the way in which they taxed palm oil and how they approached taxing and providing levies, tariffs for the palm oil market. Even to the extent that at the end of April and into some of May, they actually put in place a temporary ban on its export, which came as something as a surprise to market participants. And on the face of it, was something that did make a whole load of sense -- in the sense that when you look at Indonesia and the production that comes out of Indonesia, around 60% of world palm oil production comes from Indonesia. Now Indonesia is also a very big consumer of palm oil, but nothing like to the same extent if consumers slightly like 20% of world palm oil, so you can see there's a big imbalance there. And turning off the tap of exporting in for a short period of time is going to cause substantial excess stock to arise within the country. And that's exactly what we saw happening. Now as a result of that, when the ban was lifted towards the end of May, we saw a significant amount of that excess stock coming on to the market being exported. And inevitably, what that meant was there was then a price adjustment, a price reduction. And hence, you can see the story of that in the chart. Interestingly, we also found a situation where the Indonesian government put in place an export tariff on top of the export levy and the export duty for a short period of time following the lifting of the ban, which meant that for a short time. The tax situation, combination of the duty, the levy and the tariff was a substantial tax burden for a short period of time. That has now changed. And we now see that the tax environment is far more benign and we find ourselves in a situation where mill gate prices are now improving, and we now see mill gate pricing right now, back $700 to $800 range, which again, we have to remind ourselves of the historic context. It's not the $1,000 we were seeing in the first half. But again, like I say, remind ourselves of the historic context, $700 to $800 a tonne is an extremely healthy mill gate price to be achieving and one of which we would achieve very decent margins for what we are saying. It's also very important to talk about sustainable palm oil, coming back to what Peter was describing, is our first and most important strategic pillar of being a responsible producer. And we believe when palm oil produced sustainably provides a very high yielding and low-cost supply of vegetable oil into what continues to be a growing global market on vegetable oils. All of our areas are run absolutely to sustainability principles. And fundamentally, that absolutely means no deforestation and no burning. But it means a lot more than that for the group as well. And we try to illustrate that in some of the pictures of this slide. If you look at the top left-hand picture, you can see one of the group's biogas facilities. When we develop our mills, we develop fully integrated mills wherever we can, that will include developing a biogas facility to turn methane into green electricity to not only run our own facilities, but also to sell excess power to the local grid. In the bottom left-hand picture, you can see 1 of our composting facilities. When we take the empty fruit bunches from the mills and turn into an organic compost to send back out into the field. And then on the right-hand side, you can see pictures of one of our conservation areas, an example of what the biodiversity means and what biodiversity looks like on one of our estates. Peter has mentioned the fact that we're a long-standing member of the RSPO and all of our mills are either already RSPO certified or will become RSPO certified as we work through the journey of certification after those mills are opened. And again, we go above and beyond, and we work with independent smallholders who supply us with fruit for processing in our mills to help them in their own journey towards RSPO indication. And you can see as the final point on this slide here, there is a financial consequence of this as well. There is an additional amount of income, an additional amount of sustainability premium that we receive when we sell our RSPO certified sustainable oil. And that premium continues to increase. So we received $3.3 million in the first half of the year, up from $1.9 million in the first half of last year. And then we also wanted to share the case study with you, again, thinking about what responsible estate development looks like and what it means for us. We are committed to providing a full range of facilities for our workers and for their families, particularly when we think about some of the more remote estates that we have in the group. And a good example of that is, at our state in East Kalimantan, in those estates, we've already opened two junior schools and one senior school for the children of our estate workers. And we already have over 600 people enrolled in the current academic year in those schools. And it's an ongoing process. There's further expansion taking place in those schools. And we have another school planned to be opened next year as well. And again, I can explain this to you. We took a word on the slide, but hopefully, the pictures give a good illustration of what we mean and what those schools are like. So I think at this stage, I'd like to hand over to Chandra to talk us through crop development and milling development on our estates. Chandra, over to you.

Yes. Thank you. Thank you, Matthew. I will explain crop development, which is shown in this slide. This slide is made up of bar charts. On the far right, the far right is the total crop processed by our mills and the bar chart shows for the first half of financial year '22, January to June end versus the financial year 2021. In 2022, January to June, we processed 705,599 tonnes compared to 702,342 tonnes. It was only a 0.5% increase basically, total crop that we processed remained the same for the first half between this year and last year. Total crop process is made up of own crops, scheme smallholder crops and independent crops. This crop that we purchased from outside villages, small companies which don't have mills, we support them. For own crops, we had a 4% increase compared to last year. We processed 430,000 tonnes compared to 413,000 tonnes. For scheme smallholder crop, there is schemes, cooperative schemes that are managed by us and of the same standard, we also attained a 4% increase compared to last financial year. For independent crop purchase, we had a significant reduction in the year, financial year 2022. We only purchased 148,000 tonnes compared to 168,000 tonnes in financial 2021. The reasons being when the CPO ban was put in place, prices were not stable, and we did not want to participate in a very speculative market for a month. And another very important reason is, we had to manage our storage tank space. We had to harvest our own estate crop as well as schemes smallholder crop. Hence, we needed to keep the space. We all -- nearly all producers in Indonesia suffered a logistic issue where they could not find barges to clear the oil because of the ban. Because of the ban, oil was not exported all. So most of the oil were kept in tanks. So this really caused disparity, cost an issue. So that was the reason why we did not engage in purchasing of independent crop from outside. Hence, the reduction. But I ensure you that we have gone back now that prices are stable, logistics issues have been settled to a certain extent, we are aggressively buying independent crop. So this slide basically tells you that for the first half of the year, there has not been much of a difference between crop production. There's a 4% increase in crop in this financial year. And I can very much assure you that we will attain our budget this year on production because the second half is having a very good run right now. Next, please. The next slide is also on growth and particularly on increasing milling capacity. The bar charts here show you -- the green -- the darker green bar charts show you crop from our own estates. The lighter green bar charts show you crop from our independent smallholder areas. The orange bar charts indicate crop that is purchased from smallholders and small companies around our mills. The linear graph shows our milling capacity. Basically, this graph very clearly shows M.P. Evans' growth over the last 12 years. We have increased our crop. Our milling capacity in 2010 was only 140 tonne oil mill. In end 2022, we'll be having our sixth oil mill in operation. CPO production in the first half was 160,800 tonnes, slightly lower than first half '21, 161,400 tonnes. As I said earlier, cropping levels are very high now. We are very confident that cropping levels will be very much higher than the last financial year. Production costs, as you know, is lowest when milling our own crop -- in our own group mills. Production costs of our own crop was USD 425 per tonne. Total production costs in our group mills was USD 598 per tonne. The increase is because when we purchase outside crop and when we buy crop from our scheme -- smallholder schemes, we have to pay the market CPO price. This is a really very competitive market, but a very profitable business. As I said earlier, development of our group sixth mill, Musi Rawas is on track for completion in 2022. Margin, of course, increases as more of our own crop is milled within our own mills. We expect with the completion of Musi Rawas mill in December 2022, we expect to process 96% of all our own crop. The remaining 4% is because we have an estate in Aceh, in the province of Aceh, in North Sumatra, where we have 2,900 hectare of [ palm ]. It's not presently feasible to build a mill there. Of course, we are looking for more land around that area. Next slide, please. Again on growth and continuing investment. Planting is continuing at Musi Rawas, and we expect to plant at least 10,000 hectares. As in the previous slide, the mill #6 is prioritized to be completed in December 2022. The company also continues to invest in the group's estates, especially in the infrastructure and other facilities. We also anticipate reducing CapEx on existing estates from 2023 onwards. We are very serious about acquisition opportunities for sustainable new land around our existing estates. Of course, this goes to a process. And we are trying very hard to engage with owners around, especially around our existing estates to see whether we can purchase a piece of property that can support our progress towards expansion. Next slide, please. To you, Luke.

Okay. Great. So revenue grew by $41.7 million against the same period in the prior year, which was a 33% increase. And we've seen production levels of CPO are at a similar level to the prior year. However, the mill gate prices were significantly higher. And that average selling price is Matthew alluded to in the first half was $1,035. Our revenue growth was slightly lower than that 43% increase in CPO price. And that's because as a result of the export ban towards the back half of the first half, and we were unable to complete many shipments as we had anticipated. I mean you will know that our inventories at the end of the first half and the 30th of June were significantly higher than they have been in previous periods. We expect that to unwind in the second half. And as we've touched on previously as well, we continue to see an increase in our sustainability premiums that we can charge, up from $1.9 million last year to $3.3 million in the first half. That has largely been driven by a 90% increase in the average palm kernel premium that we're able to charge. Those high prices have in turn then allowed us to increase gross profit by 52% by $22 million, which is a 5 percentage point increase to 38% compared to the prior period in '21. Margin has increased despite some increases in costs. So our cost per tonne has increased by $90 from $335 to $425. And there's three to four main now are driving that. The biggest factor has been some inflationary pressure on our fertilizer costs. We spend a fair amount of money on fertilizer in the business. And as a result of the war in Ukraine and Russia and certain sanctions applied, there has been an increase in the demand for effectively non-Russian fertilizer. And as a result, that's pushed price up as well. So we've seen about a $30 to $40 increase per tonne in our fertilizer costs through the first half. That's roughly about double what we were paying in the first half of 2021. The other factor is that in the early part of 2022, we did see some adverse weather affect our East Kalimantan estates. And we did have to put some additional resources into maintaining and repairing infrastructure such as roads, so that has added to the increase in the cost. The other factor is that in 2021, we did have a nonrecurring pension credit from Indonesia, and that has not been effectively repeated 2022 number. And finally, we also had the Bumi Mas mill operational through the first half, which was not in operation through the first half of 2021. And those fixed costs that come in the mill have added into that $425 number. So they are the main sort of driving factors for that increase. But despite this, as I said, we did see gross profit go up by 52%. And as we continue our production and increase our production through the second half, we get to absorb that fixed cost base into a greater level of production, hence bringing down, hopefully, that cost per tonne through the second half. The increase in gross profit dropped through to operating profit and allowed us to see an increase in earnings per share of 65%. So that's up from 38.3p to 63.3p. And that allows us to continue with a very proud dividend policy and dividend progression. And we have announced an increase in our interim dividend from 10p to 12.5p, which is a 25% increase for the first half of 2022. So that fantastic trading performance generated significant cash flows, and we can see that our operating cash more than doubled compared to 2021 performance. So we went from $33 million operating cash in 2021 to $69.7 million in 2022. That's despite us continuing to invest in our infrastructure and our estates, so we're continuing to invest, as Chandra earlier alluded to, in estates into roads, into buildings. And then we've also been putting our capital investment into the six mill Musi Rawas through the first half. We also returned some of the cash that we generated to shareholders through the final dividend in 2021 and also we had a special 5p dividend announced at the end of 2021, which was also paid out in the first half of '22. That strong cash generation has enabled us to have a closing cash balance, gross cash balance at the end of 20 -- at the end of June 30, 2022, $70 million, with our gross borrowings at $56.5 million, resulting in a net cash position of $13.5 million. So we've moved from a net debt position at the end of '21 to a net cash surplus at the halfway point of '22. That has only enhanced the balance sheet for the group, with a significant increase in our net current assets really driven by that increase in gross cash and a reduction in the amount of borrowings due within the next 12 months. That strong balance sheet allows us to remain flexible and agile for any potential opportunities, inorganic opportunities, I should say, that may be in front of us in the coming months and years. So with that, I'll just pass back to Peter, who will run through returns for our investors.

Thank you, Luke. And I'll just touch briefly on the last two slides, although this is one that I'd like you to beat your eye on for a moment or two as it is something we're very proud of in terms of our track record accompanying many companies, indeed, commodity-based companies or a listed ones, which have an unbroken track record of a progressive dividend for 30 years already slightly more, i.e., either having maintained or increased the dividend year-on-year for over 30 years. As you see, the dividends paid in more recent years, particularly the last one has been significantly higher, but we have every intention of continuing that progressive dividend track record. And finally, I won't go through each of these because it's really just a reiteration of the key points, strategic pillars, which I mentioned and the highlights from the results themselves and indeed just lasting -- just ending with the exciting prospects still ahead for a number of reasons.

But I see that you've kindly asked a number of questions, which between us, have we been making some note of as each other has been doing various parts of the presentation. So I think we can go straight into those. Actually, Matthew, if you could just go scroll right back to the top. And I would suggest that we literally, I mean there's some slides of doubling up, but the first two actually were very similar. The second one, very slightly, expands on the point being made. So I'll read that one in full, which is, do you regret becoming almost completely dependent on Indonesia in view of their export levy introduced recently? The simple answer is no. We think this has been an extremely good decision. Indonesia is the lowest cost producer and the most profitable production possibilities are there. And if you are an efficient producer in Indonesia, notwithstanding some of the levy changes that have been made. I think it's been a particularly turbulent time for these various levies that have come into play in the last 6 to 8 months, but actually, strangely enough, although we've seen a very turbulent period with the top rate that all the levies combined being $688 at one stage and the current lowest level, which we're currently enjoying because of holiday on one of the levies being just $74 come the 1st of November with the latest schedule of taxes having been announced, we will go back to almost exactly the same levy structure that was in place before all the turbulence before the outbreak of the Ukraine war. And there's no question that Indonesia -- as an Indonesian producer, one can -- significantly better than in Malaysia, where that -- although there is not -- there are some taxes, not as [ decoding ] some of the taxes we had imposed recently. But nonetheless, there are taxes there. We would not anyway been able to expand in a majority wholly in Malaysia in the way we have in Indonesia. And there are very significant labor issues in Malaysia, which I'm sure Chandra could, if we had time to talk to some length on. But in Indonesia, we have wonderfully rich organic soils relatively low-cost labor many, many opportunities for a plantation company, a responsible and sustainable plantation company to flourish. And Papua New Guinea, I mean, Indonesia produces 60% of the world's palm oil, Malaysia produces another at least 25%. So that's 85% of the market, then there's Papua New Guinea. But cost in Papua New Guinea, really the same levy structures are substantially higher. So we are very comfortable with really being an explicit into these end producer. Let's move to the next points. Surely, the use of export bans creates uncertainty in the marketplace and therefore pression that Indonesia is not a reliable supplier. Buyers, therefore, are surely likely to seek alternative sources. Does the government not appreciate this? Would you like to take that, Matthew?

Yes, very happy to. I mean I think the question makes a perfectly reasonable point. And I think the interesting thing here is that during the first half of 2022, whilst the price has been in somewhat uncharted territory. The Indonesian government have been looking for measures to put in place. And the use of an export ban, perhaps as I was trying to indicate, was something of a surprising move by the Indonesian government and perhaps didn't have the effect that they thought it might was perhaps somewhat self-defeating in a lot of ways. I think it would be extremely unlikely based on the representations they then received and the feedback they had to see something of that nature occurring again, I think a lot of the feedback that then come back from some of the very large industry players to the Indonesian government is the fact that what industry really craves is certainty and stability. Of course, it's understood that there is going to be a level of taxation. But what's not helpful is those kind of changes and those kind of measures coming in and coming out in the way that has taken place. I mean it remains the case, of course, be Indonesia is by far the largest producer of palm oil in the world and will continue to be so. But I think the government, as I say, has been to come up with client phrase for a learning journey through the first half of this year.

Fine. Let's look to the next one -- sorry, which one?

So I think that one there, Peter.

Can you -- yes, sorry, can you provide any guidance on long-term growth rate in demand you mentioned, combined with any view on outlook for supply-demand balance and pricing outlook? I mean, I'd just make a very, very broad brief point, which is that in some reason is rather difficult to measure this because palm oil of all the competing vegetable oils, palm oil is the only one which it is a permanent crop, once it's in the ground, it's there for 25 years, whereas all its competing crops are annual crops and it is a decision of an individual farmer as to whether to plant back crop soya, grapeseed, sunflower, whatever it might be, depending on how that farmer views the outlook for the year ahead and the likely price they will receive compared to planting an alternative crop. But broadly speaking, demand is growing for vegetable oils as the world becomes well population grows. And the reassuring thing is that palm oil is the cheapest of all the vegetable oil that is produced. And Indonesia is the cheapest area where palm oil is produced on any significant scale. And therefore, when other producers are finding it difficult to compete and efficient Indonesian farmer producer, we'll peak their head by water for longer than the rest I mean, touching with firmly, we as a group, the time 35 years or said that I've been with the group, we've never lost money on palm oil. Is there anything briefly you want to add to that, Matthew, in terms of the long term supply demand?

I think on the demand side, exactly as you described, there are all of those long-term trends for increasing demand continue. On the supply side, clearly, there are some indications that certainly in Malaysia, the amount of investment going into the industry to support the supply side is decreasing. So if you look at that balancing act that has been managed. The question we led on to what that might mean for pricing. Of course, we've got a continuing uptick in demand and then some supply constraints. And you can form your judgments as to what that might mean for the pricing environment.

Indeed. Let's move on to the next one. You mentioned potential for growth investments, acquisitions, can you talk about the possible scale of these and what are your payback period you use for assessing these? I'll kick off with that answering the first part of it. Yes, absolutely. I mean, we've stated it, it's a strategic priority to identify and secure new acquisitions, particularly around our existing projects, where we have surplus mining capacity. So especially at our biggest project, kind of the Kota Bangun in East Kalimantan where we have 15,000, 15,500 hectares, we'd like to increase that to 20,000 hectares so that we can make full use of the two mills where we do have some current surplus capacity. And going back to that orange line versus the green line we saw earlier, it would be good to turn more of that orange to green and therefore, achieve a higher profit margin from processing our own crops rather than buying in independent smallholders. So that is a priority. If you like one silver lining of the fact that the palm oil price has come down from the metrics at least, high levels at the recent past or there was still a very healthy levels, is that the expectation on the part of prospective sellers of land or projects has come down to more realistic levels again, and we are seeing one or two cells creep out of the woodwork again. And we hope to be able to announce some success in acquiring some new projects ideally around our existing estate and potentially also some stand-alone projects as well. I dare both Matthew or Luke, we're not there on to sort of put this storied immediately on in terms of hurdle rates and payback periods, I mean, that's, yes...

I mean just very briefly, I mean, we tend to think in terms of little rate rather than paying back periods. It's just a way in which we tend to operate when we do feasibility analysis. We will tend to start with as a minimum, something of the order of 12%. But things are moving a little bit clearly as the interest rate environment is moving a little bit number of fact how we judge these things is not completely fixed analysis. So I can't say there's always a precise and exactly fixed hurdle rate. It will depend on looking at how a little bit of movement in our WACC analysis.

Fine. The next question is, would not be a considerable financial balance sheet created by high prices allow for a much bigger share buyback than the company is currently implementing, given the share price discount and NAV? This must surely be one of the most attractive uses of -- [ evidence of ] financial resources. I mean, we agree that this is an excellent opportunity to buy back our own shares. And as you know, we did reintroduce that recently at our AGM, which was based through by shareholders, and we have started on that journey. We announced in the market, the insure authority. And we will, I'm sure, continue there'll be further announcements on that soon. We are, however, restricted by how much we can buy, we can only acquire 25% of the average daily volume traded over the last 28 days. So there is a significant restriction on the amount that we are committed to buy under the MAR, Market Abuse Regulations. So -- but absolutely, we will, I'm sure, continue with that policy. It does represent, you're absolutely right. It's equivalent to buying our own projects at an average of what 13,000 per hectare compared with where they've been independently valued at some 20,000 per hectare. Next question, what is the lifespan of the singular palm oil or oil palm as we tend to call it. Chandra, just briefly, can you describe the life time of an oil palm?

The productive life is about 25 years, productive life, of course the palm oil, we are not commercially growing, it can grow up to 50, 60 years. But usually, plantation companies, maximum, they'll keep it this up to 25 years.

So in 25-year lifetime of which peaks 10 years or so, some production period. Let's just move to -- because we had some briefs, we'll come back to that in a moment, but they are on one or two questions, which was presubmitted. Luke, perhaps, this one on for you. Do you have any extension planting target by continuing planting of our existing land, I believe that refers to. And when the '22 annual report is published is so are you able to reveal that information today?