African Potash Ltd Trading Update - New supply agreement secured (9157F)
02 Agosto 2016 - 1:01AM
UK Regulatory
TIDMAFPO
RNS Number : 9157F
African Potash Ltd
02 August 2016
African Potash Limited / Index: AIM / Epic: AFPO / Sector:
Mining
2 August 2016
African Potash Limited ('African Potash' or 'the Company')
Trading Update
New supply agreement secured
African Potash, the AIM listed exploration company focused on
the vertical integration of fertiliser operations in Africa and
Sub-Saharan potash assets, is pleased to announce that it has
signed a fertiliser supply agreement with Rockwell Fertilisers
Limited ('Rockwell'), a supplier and distributor of fertilisers in
Zambia.
African Potash will supply Rockwell with fertiliser products
(NPK and Urea) to be sold on to prospective buyers, namely retail
outlets who sell fertilisers to farmers in Zambia. This is
supported by the Common Market for Eastern and Southern Africa
('COMESA'), with whom African Potash has an existing agreement, and
Nutri-Aid Trust, a Zambian non-profit enterprise ('Nutri-Aid'),
with whom African Potash has a trading agreement to sell Urea and
other fertiliser products to Nutri-Aid's supply network, which
includes over 2,500 agro-outlets certified by COMESA and managed by
Nutri-Aid (with each outlet serving on average 300 farmers
each).
Under the agreement it is anticipated that the value and
quantity of each order will vary in accordance with buyer demand.
African Potash will receive an up-front payment of 50% of the total
order value for each purchase by prospective customers. Payment for
the remaining 50% of the total order value due to African Potash
will be required on or before the day falling 45 days after the
relevant invoice has been issued, as is customary for purchase
agreements of this nature. African Potash would need to meet the
costs of purchases of stock made from its suppliers.
In consideration for introducing and arranging new customers
Rockwell will receive 30% of the net profit generated from sales of
fertiliser products under this agreement (net profit is the selling
price minus the supply price, which includes supply chain costs
incurred in the sourcing, storage and movement of fertiliser). The
Company will retain the remaining 70%. The agreement is valid for a
minimum of 12 months and shall be subject to quarterly reviews.
This agreement is in settlement of the previously announced
agreement for the supply of 20,000Mt of Urea to a customer
introduced by COMESA, as announced on 6 January 2016 and in the
subsequent announcements on 9 February 2016, 29 March 2016 and 22
April 2016.
African Potash is also pleased to confirm that its on-going
trading agreement, as per the RNS dated 22 April 2016, is
progressing in accordance with its contractual commitments. Payment
is now subject to the African Potash's trading partner successfully
concluding its obligations and receiving payment in accordance with
its sales agreement.
African Potash Executive Chairman Chris Cleverly said, "We are
delighted to have further strengthened our trading presence in
Zambia and the southern African region through the signing of this
trading agreement with Rockwell, which complements our recently
announced trading agreement with Nutri-Aid. With a number of
strategic partners in place through whom we can secure off-take
agreements for the purchase of our fertiliser product, and the
results of this strategy already showing success, I believe African
Potash is well set for continued growth."
* * ENDS * *
For further information visit www.africanpotash.com or contact
the following:
+44 (0) 20 7236
Chris Cleverly African Potash Limited 1177
Cantor Fitzgerald +44 (0) 20 7894
Stewart Dickson Europe 7000
Cantor Fitzgerald +44 (0) 20 7894
Patrick Pittaway Europe 7000
Cantor Fitzgerald +44 (0) 20 7894
David Porter Europe 7000
+44 (0) 20 7710
Colin Rowbury Cornhill Capital Limited 9610
St Brides Partners +44 (0) 20 7236
Charlotte Heap Ltd 1177
St Brides Partners +44 (0) 20 7236
Susie Geliher Ltd 1177
The information contained within the announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). Upon the
publication of this announcement via Regulatory Information Service
("RIS"), this inside information is now considered to be in the
public domain.
About African Potash
African Potash is an AIM quoted company focussed on building a
vertically integrated platform for the mining, production and
distribution of fertiliser, primarily within Africa.
The Company has a trading agreement with the Common Market for
Eastern and Southern Africa ('COMESA'), a free trade union for
twenty African member states, to supply and deliver fertiliser to
off-takers identified and introduced by COMESA.
The Company also operates the Lac Dinga Project in the Republic
of Congo, which is prospective for potash.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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