TIDMTREE
RNS Number : 4444N
Cambium Global Timberland Limited
29 January 2021
29 January 2021
Cambium Global Timberland Limited (the "Company")
Net Asset Value, Interim Results
Net Asset Value
The Company announces that the Net Asset Value per share as at
31 October 2020 is 8.8p.
Interim Results
The Company announces that the Interim Report and Unaudited
Condensed Consolidated Interim Financial Statements (the "Interim
Report") for the six months ended 31 October 2020 are available and
set out in full below.
An electronic copy of the Interim Report is also available on
the Company's website at www.cambium.je .
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014. Following the
publication of this announcement, this inside information is now
considered to be in the public domain.
For further enquiries please contact:
Chairman
Tony Gardner-Hillman
01534 486980
Broker and Nominated Adviser
WH Ireland Limited
James Joyce
020 7220 1698
Administrator and Company Secretary
Praxis Fund Services (Jersey) Limited
01534 835835
Cambium Global Timberland Limited
Interim Report and Unaudited Condensed Consolidated Interim
Financial Statements
for the six months ended 31 October 2020
Chairman's statement
Assets and values
The Company's Net Asset Value per share ("NAVPS") as of 31
October 2020 is 8.8p, compared with 10.4p as at 30 April 2020, a
decrease of 15.7% in the period.
The change in NAVPS comprised currency movements (-7.4%), net
expenditure on forestry and other costs (-7.6%), and accrued
interest on the loan from Peter Gyllenhammar AB (announced on 21
December 2017) (-0.7%) .
It is pleasing that the land sale opportunities I previously
reported have now concluded, leaving Cambium with only its
interests in the Lizarda property (carried at nil value), the
receivables to become payable over periods up to February 2023
under the announced land sales contracts, and its cash balances at
bank. The Company is now in discussions with a potential purchaser
of those interests. If that transaction concludes, the Board will
convene a general meeting where it will propose the winding up of
the Company, enabling the liquidator to return capital to
shareholders via a distribution of the final net cash balance. In
the Board's judgment, the likelihood of a liquidation and return of
cash to shareholders, which has been the objective since 2013, is
now sufficiently high and close at hand to require that financial
statements be prepared on a non-going concern basis, which is the
presentation now adopted. In the event the sale of the Company's
remaining interests referred to above does not go ahead, the Board
will re-visit this judgment and may decide to revert to a going
concern basis of presentation for subsequent financial
statements.
All in all, persistence in markets which were difficult even in
normal times has enabled the Company to reach the end of its
journey to sell its properties. The Board is now working to close
the final transaction mentioned above, to enable the final cash
distribution to shareholders to take place sooner rather than
later.
As at the period end the Company and its subsidiaries had cash
reserves of GBP1,013,276.
Costs
New expenditure on properties has of course now been ended by
land sales.
Administrative expenses are up 24% on the corresponding prior
period (note 4), principally due to increased legal and
administrative costs in Brazil.
However, forestry expenses (notes 5 and 6) again show a
meaningful fall against the prior period, down 10%, demonstrating
the ongoing effort to curtail costs that continued until the end,
but in a way that continued to protect the Group's remaining assets
until disposal.
The net result, allowing for the impact of currency
fluctuations, is that total costs, including finance costs, for the
period in Sterling terms amounted to GBP0.64 million, as compared
with GBP0.59 million for the same period last year.
Conclusions
I am pleased with the events over the period, and since the
period end, and I now look forward to delivering my next, and
likely to be my final, report .
Antony R Gardner-Hillman
Chairman
29 January 2021
Operations Manager's report
For the six months ended 31 October 2020
Total returns for the period covered by these financial
statements, including translation differences, were a loss of
GBP1.2 million compared to a loss of GBP0.9 million in the
corresponding prior year period. The portfolio returns continue to
be primarily impacted by operating costs and foreign exchange
losses arising on translation.
Below is a summary of the results by geographic area.
Brazil
The Brazilian portfolio represented 100% of the total physical
assets at the 31 October 2020. Subsequently all the assets are now
contracted for sale with all payments being received as
anticipated.
At the 3R plantation, expenditure continued on the good 1,600
hectares of coppice regrowth which are growing well and demonstrate
the potential of the site when planted with the right clone and
well tended. Fortunately at 3R, the local forestry company decided
that they would rather purchase than lease the property and the
sale closed after the period end. As the purchaser is under the
Brazilian equivalent of Chapter 11 re-organisation, a sale with a
single purchase payment was negotiated, and that has been received
in full.
In Minas Gerais, in line with payment terms under pre-existing
wood sale agreements, payments were received for harvesting at Agua
Santa and Ribeirao do Gado and these contracts were subsequently
superseded by contracts with the same parties agreeing also to
purchase the land, with payments over the same periods. Payments
are no longer linked to charcoal prices. At Forquilha the standing
wood was sold during the period, with harvesting and payments due
over two years. Subsequently, and as announced, the land at
Forquilha has also been sold with payments over two years, and
initial payments have been received.
Expenditure on security, fire protection and insurance, required
prior to the sales to protect the Company's assets, has now
ceased.
United States - Hawaii
Cambium previously sold its plantation leases by way of
assignment, and the terms of the landlords' consents to the lease
assignments required a sum equal to the balance of outstanding
lease rental payments to be placed in escrow by Cambium, as
security to the landlords that lease rental payments would be
received when due from the assignee. Cambium recorded the escrow
balance as an asset, which represented less than 1% of the total
assets. The assignee of the plantation leases has continued to pay
the rent to the landlords, so allowing the release of escrow fund
to Cambium as scheduled. Subsequent to the period end the final
amounts have been released from escrow and no balances are
outstanding.
Conclusion
The focus during the period was to complete the realisation of
the company's assets. Good progress was made in the period and
subsequently the process has been completed, so turning the
physical assets into defined cash flows over periods up to February
2023.
Robert Rickman
Operations Manager
29 January 2021
Unaudited condensed consolidated interim statement of
comprehensive income
For the six months ended 31 October 2020
For the For the
six six
months months
ended ended
31 October 31 October
2020 2019
Unaudited Unaudited
Continuing operations Notes GBP GBP
----------------------------------------------------- ------ ------------- -------------
Finance costs (58,610) (57,891)
Net foreign exchange (loss)/gain (278) 1,349
----------------------------------------------------- ------ ------------- -------------
Net finance costs (58,888) (56,542)
----------------------------------------------------- ------ ------------- -------------
Administrative expenses 4 (239,703) (228,208)
Loss for the period from continuing operations (298,591) (284,750)
----------------------------------------------------- ------ ------------- -------------
Discontinued operations
----------------------------------------------------- ------ ------------- -------------
Loss on disposal of assets held for sale - (69,086)
Administrative expenses 4 (105,411) (49,882)
Forestry management expenses 5 (1,068) (5,013)
Other operating forestry expenses 6 (225,990) (247,226)
(332,469) (358,409)
---------------------------------------------------------------------------- -------------
Operating loss from discontinued operations (332,469) (371,207)
----------------------------------------------------- --------------------- -------------
Finance costs (6,844) (970)
Net foreign exchange (loss)/gain (63,567) 2,546
----------------------------------------------------- --------------------- -------------
Net finance (costs)/income (70,411) 1,576
----------------------------------------------------- --------------------- -------------
Loss before taxation from discontinued operations (402,880) (369,631)
Taxation charge 7 - -
----------------------------------------------------- ------ ------------- -------------
Loss for the period from discontinued operations (402,880) (369,631)
----------------------------------------------------- --------------------- -------------
Total loss for the period (701,471) (654,381)
----------------------------------------------------- --------------------- -------------
Other comprehensive loss
Items that are or may be reclassified to profit or loss, net of tax
Foreign exchange loss on translation of discontinued
foreign operations 13 (505,712) (256,244)
Other comprehensive loss for the period (505,712) (256,244)
----------------------------------------------------- ------ ------------- -------------
Total comprehensive loss for the period (1,207,183) (910,625)
------------------------------------------------------------- ------------- -------------
Basic and diluted loss per share 8 (0.95) pence (0.89) pence
----------------------------------------------------- ------ ------------- -------------
Basic and diluted loss per share from continuing 8 (0.40) pence (0.39) pence
operations
----------------------------------------------------- ------ ------------- -------------
Basic and diluted loss per share from discontinued 8 (0.55) pence (0.50) pence
operations
----------------------------------------------------- ------ ------------- -------------
All losses from continuing and discontinued operations are
attributable to the equity holders of the parent Company. There are
no minority interests.
The accompanying notes form an integral part of these unaudited
condensed consolidated interim financial statements.
Unaudited condensed consolidated interim statement of financial
position
At 31 October 2020
31 October 30 April
2020 2020
Unaudited Audited
Notes GBP GBP
Non-current assets
Trade and other receivables 12 747,729 1,441,991
Current assets
Assets held for sale 11 4,480,262 5,608,306
Trade and other receivables 12 2,089,349 1,816,048
Cash and cash equivalents 1,013,276 625,612
-------------------------------- ------------------------- ------ ------------- -------------
Total current assets 7,582,887 8,049,966
-------------------------------- ------------------------- ------ ------------- -------------
Total assets 8,330,616 9,491,957
-------------------------------- ------------------------- ------ ------------- -------------
Current liabilities
Liabilities held for
sale 11 56,244 46,269
Loan payable to related
party 1,709,367 1,652,347
Trade and other payables 68,502 89,655
Total liabilities 1,834,113 1,788,271
-------------------------------- ------------------------- ------ ------------- -------------
Net assets 6,496,503 7,703,686
-------------------------------- ------------------------- ------ ------------- -------------
Equity
Stated capital 14 2,000,000 2,000,000
Distributable reserve 15 82,603,312 82,603,312
Translation reserve 13,15 (943,441) (437,729)
Retained loss (77,163,368) (76,461,897)
-------------------------------- ------------------------- ------ ------------- -------------
Total equity 6,496,503 7,703,686
-------------------------------- ------------------------- ------ ------------- -------------
Net asset value per 9 8.8 pence 10.4 pence
share
-------------------------------- ------------------------- ------ ------------- -------------
These unaudited condensed consolidated interim financial
statements were approved and authorised for issue on 29 January
2021 by the Board of Directors.
Antony R Gardner-Hillman Mark Rawlins
Chairman Director
The accompanying notes form an integral part of these unaudited
condensed consolidated interim financial statements.
Unaudited condensed consolidated interim statement of changes in
equity
For the six months ended 31 October 2020
Share Distributable Translation Retained
Unaudited Capital reserve reserve loss Total
GBP GBP GBP GBP GBP
For the six months ended
31 October 2020
------------------------------------------------ -------------- ------------ ------------- ------------
At 30 April 2020 2,000,000 82,603,312 (437,729) (76,461,897) 7,703,686
Total comprehensive loss
for the period
Loss for the period - - - (701,471) (701,471)
Other comprehensive loss
Foreign exchange loss
on translation of discontinued
foreign operations (note
13) - - (505,712) - (505,712)
------------------------------------ ---------- -------------- ------------ ------------- ------------
Total comprehensive loss - - (505,712) (701,471) (1,207,183)
------------------------------------ ---------- -------------- ------------ ------------- ------------
At 31 October 2020 2,000,000 82,603,312 (943,441) (77,163,368) 6,496,503
------------------------------------ ---------- -------------- ------------ ------------- ------------
Share Distributable Translation Retained
Unaudited Capital reserve reserve loss Total
GBP GBP GBP GBP GBP
For the six months ended
31 October 2019
------------------------------------------------ -------------- ------------ ------------- -----------
At 30 April 2019 2,000,000 82,648,243 2,802,225 (73,503,073) 13,947,395
Total comprehensive loss
for the period
Loss for the period - - - (654,381) (654,381)
Other comprehensive loss
Foreign exchange loss
on translation of discontinued
foreign operations (note
13) - - (256,244) - (256,244)
------------------------------------ ---------- -------------- ------------ ------------- -----------
Total comprehensive loss - - (256,244) (654,381) (910,625)
------------------------------------ ---------- -------------- ------------ ------------- -----------
Transactions with owners
------------------------------------ ---------- -------------- ------------ ------------- -----------
Share buy-backs - (44,931) - - (44,931)
---------- -------------- ------------ ------------- -----------
At 31 October 2019 2,000,000 82,603,312 2,545,981 (74,157,454) 12,991,839
------------------------------------ ---------- -------------- ------------ ------------- -----------
The accompanying notes form an integral part of these unaudited
condensed consolidated interim financial statements.
Unaudited condensed consolidated interim statement of cash
flows
For the six months ended 31 October 2020
For the six
For the six months ended
months ended 31 October
31 October 2020 2019
Unaudited Unaudited
Note GBP GBP
--------------------------------------------------- ------- ----------------- ---------------
Cash flows from operating activities
Total loss for the period (701,471) (654,381)
Adjustments for:
Loss on sale of assets held for sale - 69,086
Net finance costs, excluding foreign exchange
movements -
continuing operations 58,610 57,891
Net finance costs, excluding foreign exchange
movements - discontinued operations 6,844 970
Decrease/(increase) in trade and other
receivables 14,085 (25,171)
(Decrease)/increase in trade and other
payables (11,178) 108,633
---------------------------------------------- ---------------------------- ---------------
(633,110) (442,972)
Tax paid - -
---------------------------------------------------------- ------------------- ---------------
Net cash used in operating activities (633,110) (442,972)
---------------------------------------------------------- ------------------- ---------------
Cash flows from investing activities - discontinued operations
Net proceeds from sale of assets held for
sale 11 1,106,244 399,054
Net cash from investing activities 1,106,244 399,054
------------------------------------------------- ---------------------------- ---------------
Cash flows from financing activities
Share buy backs - (44,931)
Net finance costs, excluding foreign exchange
movements (8,434) (2,396)
Net cash used in financing activities (8,434) (47,327)
------------------------------------------------- ---------------------------- ---------------
Net increase/(decrease) in cash and cash
equivalents 464,700 (91,245)
Foreign exchange movements (77,036) (14,546)
Balance at the beginning of the period 625,612 1,137,281
------------------------------------------------- ---------------------------- ---------------
Balance at the end of the period 1,013,276 1,031,490
------------------------------------------------- --------- ----------------- ---------------
The accompanying notes form an integral part of these unaudited
condensed consolidated interim financial statements.
Notes to the unaudited condensed consolidated interim financial
statements
For the six months ended 31 October 2020
1. General information
The Company and its subsidiaries (together the "Group"), is
nearing the end of a process of realising a portfolio of forestry
based properties managed on an environmentally and socially
sustainable basis. Assets are managed for timber production, with
exposure to emerging environmental markets. As at the period end
date the Group's remaining forestry assets were all located in
Brazil.
The Company is a closed-ended company with limited liability,
incorporated in Jersey, Channel Islands on 19 January 2007. The
address of its registered office is Charter Place, 23-27 Seaton
Place, St Helier, Jersey JE1 1JY.
These unaudited condensed consolidated interim financial
statements (the "interim financial statements") were approved and
authorised for issue on 29 January 2021 and signed by Antony
Gardner-Hillman and Mark Rawlins on behalf of the Board.
The Company is listed on AIM, a market of the London Stock
Exchange.
2. Basis of preparation
The interim financial statements for the six months ended 31
October 2020 have been prepared in accordance with International
Accounting Standard ("IAS") 34 "Interim Financial Reporting" and
with applicable regulatory requirements of the AIM Rules. They do
not include all of the information required for full annual
financial statements. The interim financial statements should be
read in conjunction with the Group's annual report and financial
statements for the year ended 30 April 2020, which were prepared in
accordance with International Financial Reporting Standards
("IFRS"). The comparative numbers used for the unaudited condensed
consolidated interim statement of comprehensive income, unaudited
condensed consolidated interim statement of changes in equity and
unaudited condensed consolidated interim statement of cash flows
are those of the six month period ended 31 October 2019, in
accordance with IAS 34. The comparatives used in the unaudited
condensed consolidated statement of financial position are those of
the previous financial year to 30 April 2020.
The accounting policies applied by the Group in these interim
financial statements are the same as those applied by the Group in
its financial statements for the year ended 30 April 2020, with the
exception that these interim financial statements are prepared on a
non-going concern basis.
The interim financial statements have been presented in
Sterling, which is also the functional currency of the Company, and
under the historical cost convention, except for investment
property, plantations, buildings, assets and liabilities held for
sale and certain financial instruments which are carried either at
fair value, fair value less cost to sell or fair value less
subsequent accumulated depreciation and subsequent accumulated
impairment loss.
The preparation of the financial statements requires Directors
to make estimates and assumptions that affect the reported amounts
of revenues, expenses, assets and liabilities, and the disclosure
of contingent liabilities at the date of the interim financial
statements. If in the future such estimates and assumptions, which
are based on the Directors' best judgement at the date of the
interim financial statements, deviate from actual circumstances,
the original estimates and assumptions will be modified as
appropriate in the period in which the circumstances change.
In preparing the interim financial statements, the significant
judgements made by management in applying the Group's accounting
policies and the key sources of estimation uncertainty are the same
as those that applied to the financial statements for the year
ended 30 April 2020, other than those relating to going concern,
which are discussed below. The main areas of the interim financial
statements where significant judgements have been made by the
Directors are in determining the going concern status of the
Company (as discussed below) and the fair value of the assets held
for sale (as disclosed in note 10).
Going concern and assets and liabilities held for sale
On 30 November 2012, the Independent Directors announced the
outcome of the strategic review initiated in June 2012. The
Directors proposed and recommended a change of investment policy
with a view to implementing an orderly realisation of the Group's
investments in a manner which maximises value for shareholders, and
returning surplus cash to shareholders over time through ad hoc
returns of capital. This proposal was approved by shareholders at
an Extraordinary General Meeting ("EGM") on 22 February 2013. There
is no set period for the realisation of the portfolio.
Since the EGM, the portfolio has been reviewed by the Directors
with a view to an orderly sale of the assets in such a manner as to
enable their inherent value to be realised. As part of this
process, the Directors have sold assets when acceptable offers have
been received. As a result, at 31 October 2020, the remaining
portfolio of assets, located in Brazil, is classified as held for
sale (and its transactions for the period as discontinued
operations) under IFRS 5 'Non-current Assets Held for Sale and
Discontinued Operations', as disclosed in note 11.
As at the date of approval of these financial statements, the
Directors have not yet taken steps to instigate a winding-up of the
Company, a course of action that would require the approval of
shareholders. As a result, and as the remaining assets are not in a
condition that could be classified as 'held for distribution to
owners' under IFRS 5, as at 31 October 2020, the assets and
liabilities of the Company pertaining to the Jersey operations have
not been classified as held for sale and its Jersey operations
continue to be treated as continuing.
2. Basis of preparation (continued)
Going concern and assets and liabilities held for sale
(continued)
The COVID-19 pandemic has had an adverse impact on the global
commercial market and contributed to the volatility of businesses
and communities throughout the world. The impact is still evolving
and will require continued assessment whilst the pandemic
continues. The extent of the impact on the Group's investments and
ultimately on the Group will depend on future developments,
including the duration of the outbreak and the effect on the
Brazilian economy, in particular on the counterparties to the
Group's agreements for the sales of properties. The virus is
widespread in Brazil, and is likely to continue to be so for some
time, however there is evidence that Brazilian rural activities
continue largely unaffected, as demonstrated by the agreements
subsequent to the reporting date to sell the 3R and Forquilha
properties. These agreements are underpinned by the competitive
Brazilian exchange rate and continued demand for wood, paper and
agricultural products on a worldwide basis, despite an economic
slow-down in other sectors. The Group continues to monitor the
ability of service providers to continue to function with employees
working from home. In the opinion of the Board, the potential
impacts of the pandemic are significantly lessened by completion of
the process of selling all significant properties, and the Board,
without having made specific enquiry, has no reason to believe that
purchasers are likely to default on remaining deferred payment
obligations.
The Directors have reviewed the Group's cash flow forecasts,
which cover the period to 31 December 2024 and consider that the
Group has sufficient resources available to pay its liabilities as
they fall due. However, as noted in the Chairman's Statement,
following the disposal of the Group's remaining significant
property assets subsequent to the period end, the Board is
currently in discussions with a potential purchaser of the
Company's subsidiaries, which own the rights to the proceeds of
those and other previous disposals. If that transaction concludes,
the Board will convene a general meeting to propose the winding up
of the Company, with a view to returning capital to shareholders
via a distribution of the final net cash balance. On the basis of
the above, the Directors believe it is no longer appropriate to
prepare the financial statements on a going concern basis and
therefore these interim financial statements have been prepared on
a non-going concern basis. No liquidation costs have been accrued
for, as the Directors do not consider that these will be
material.
New accounting standards effective and adopted
There have been no new accounting standards, interpretations or
amendments to existing standards issued and effective for the
period that have had a material impact upon the Company.
Exchange rates
The following exchange rates have been applied in these interim
financial statements to translate foreign currency balances to
Sterling:
31 October 31 October 30 April 31 October
2020 2020 2020 2019
closing rate average rate closing rate average rate
---------------------- ------------- ------------- ------------- -------------
Brazilian Real 7.4401 6.9285 6.9081 4.9814
United States Dollar 1.2947 1.2758 1.2594 1.2528
---------------------- ------------- ------------- ------------- -------------
3. Operating segments
The Board of Directors is charged with setting the Company's
investment strategy in accordance with the Prospectus. The Board of
Directors, as the Chief Operating Decision Maker ("CODM"), had,
until 16 October 2014, delegated the day to day implementation of
this strategy to its Investment Manager and, with effect from 16
October 2014, to its Operations Manager, but retains responsibility
to ensure that adequate resources of the Company are directed in
accordance with its decisions. The investment decisions of the
Operations Manager have been and are reviewed on a regular basis to
ensure compliance with the policies and legal responsibilities of
the Board.
Whilst the Operations Manager may manage operations on a day to
day basis, any changes to the investment strategy, major allocation
decisions or any asset dispositions or material timber contracts
have to be approved by the Board, even though they may be proposed
by the Operations Manager. The Board therefore retains full
responsibility as to the major decisions made on an ongoing
basis.
As at 31 October 2020, the Group operates in two geographical
locations, which the CODM has identified as one non-operating
segment, Jersey, and one operating segment, Brazil. All timberlands
remaining at the period end are located in Brazil. All segments,
apart from Jersey, have been classified as discontinued operations
(see note 11). The accounting policies of each operating segment
are the same as the accounting policies of the Group, therefore no
reconciliation has been performed.
3. Operating segments (continued)
Jersey Hawaii Brazil Total
31 October 2020 (unaudited) GBP GBP GBP GBP
------------------------------------- ---------- ------- ---------- ----------
Assets and disposal group held for
sale (note 11) - - 4,480,262 4,480,262
Other assets 435,916 38,226 3,376,212 3,850,354
------------------------------------- ---------- ------- ---------- ----------
Total assets 435,916 38,226 7,856,474 8,330,616
------------------------------------- ---------- ------- ---------- ----------
Total liabilities 1,777,869 - 56,244 1,834,113
------------------------------------- ---------- ------- ---------- ----------
Jersey Hawaii Brazil Total
30 April 2020 (audited) GBP GBP GBP GBP
------------------------------------- ---------- ------- ---------- ----------
Assets and disposal group held for
sale (note 11) - - 5,608,306 5,608,306
Other assets 514,650 52,316 3,316,685 3,883,651
------------------------------------- ---------- ------- ---------- ----------
Total assets 514,650 52,316 8,924,991 9,491,957
------------------------------------- ---------- ------- ---------- ----------
Total liabilities 1,742,002 - 46,269 1,788,271
------------------------------------- ---------- ------- ---------- ----------
Jersey Hawaii Brazil Total
31 October 2020 (unaudited) GBP GBP GBP GBP
----------------------------------------- -------- -------- -------- --------
Loss on disposal of assets and disposal
group held for sale - - - -
----------------------------------------- -------- -------- -------- --------
Forestry management expenses - - 1,068 1,068
----------------------------------------- -------- -------- -------- --------
Other operating forestry expenses - - 225,990 225,990
----------------------------------------- -------- -------- -------- --------
Jersey Hawaii Brazil Total
31 October 2019 (unaudited) GBP GBP GBP GBP
----------------------------------------- -------- -------- --------- ---------
Loss on disposal of assets and disposal
group held for sale - - (69,086) (69,086)
----------------------------------------- -------- -------- --------- ---------
Forestry management expenses - - 5,013 5,013
----------------------------------------- -------- -------- --------- ---------
Other operating forestry expenses - - 247,226 247,226
----------------------------------------- -------- -------- --------- ---------
As at 31 October 2020 the Group owned two (30 April 2020: three)
distinct parcels of land in one geographical area.
There was no revenue in the periods ended 31 October 2020 or 31
October 2019.
Since the period end, the Group's remaining significant
investments have been contracted to be sold.
The net cash proceeds from realisations of assets will be
applied to the payments of tax or other liabilities as the Board
thinks fit prior to making payments to shareholders.
4. Administrative expenses
For the
six months
For the six ended
months ended 31 October
31 October 2020 2019
Unaudited Unaudited
GBP GBP
---------------------------------------------------------------- ------------
Continuing operations
Operations Manager's fees (note 17) 53,000 53,000
Directors' fees (note 17) 49,000 49,000
Auditor's fees 23,975 21,361
Professional & other fees 113,728 104,847
239,703 228,208
Discontinued operations
Professional & other fees 93,201 26,329
Administration of subsidiaries 12,210 23,553
------------------------------------------------------ -------- ------------
105,411 49,882
Total administration expenses 345,114 278,090
------------------------------------------------------ -------- ------------
Administration of subsidiaries includes statutory fees,
accounting fees and administrative expenses in regard to the asset
holding subsidiaries.
5. Forestry management expenses
For the
six months
For the six ended
months ended 31 October
31 October 2020 2019
Unaudited Unaudited
GBP GBP
------------------------------------------------------------- ------------
Appraisal fees 1,068 5,013
1,068 5,013
------------------------------------------------------------- ------------
6. Other operating forestry expenses
For the
six months
For the six ended
months ended 31 October
31 October 2020 2019
Unaudited Unaudited
GBP GBP
------------------------------------------------------------------ ------------
Property management fees, forest protection and other
expenses 225,990 247,226
------------------------------------------------------- --------- ------------
7. Taxation
Taxation on profit on ordinary activities
Entities within the Group made no taxable profits during the
period and there was no tax charge for the period. A reconciliation
of the Group's pre-tax loss to the tax charge is shown below.
For the
six months
For the six ended
months ended 31 October
31 October 2020 2019
Unaudited Unaudited
GBP GBP
--------------------------------------------------------------------- ------------
Tax charge reconciliation
Loss for the period from continuing operations before
taxation (298,591) (284,750)
Loss for the period from discontinued operations before
taxation (402,880) (369,631)
--------------------------------------------------------- ---------- ------------
Total loss for the period before taxation (701,471) (654,381)
--------------------------------------------------------- ---------- ------------
Tax credit using the average of the tax rates in the
jurisdictions in which the Group operates (112,697) (116,413)
Effects of:
Operating losses for which no deferred tax asset is
recognised 112,697 114,136
Capital losses for which no deferred tax asset is
recognised - 2,277
Tax charge for the period - -
--------------------------------------------------------- ---------- ------------
The average tax rate is a blended rate calculated using the
weighted average applicable tax rates of the jurisdictions in which
the Group operates. The average of the tax rates in the
jurisdictions in which the Group operates in the period was 16.07%
(31 October 2019: 17.79%). The effective tax rate in the period was
0% (31 October 2019: 0%).
At the period end date, the Group has unused operational and
capital tax losses. No deferred tax asset has been recognised in
respect of these losses due to the unpredictability of future
taxable profits and capital gains available against which they can
be utilised. Tax losses arising in the United States can be carried
forward for up to 20 years; those arising in Brazil can be carried
forward indefinitely.
Operational tax losses for which deferred tax assets have not
been recognised in the consolidated financial statements
For the
For the six year ended
months ended 30 April
31 October 2020 2020
Unaudited Audited
GBP GBP
--------------------------------------------------------------- ------------
Balance at beginning of the period/year 5,257,887 5,883,902
Current period/year operating losses for which no
deferred tax asset is recognised 407,861 649,334
Exchange rate movements (294,410) (1,275,349)
--------------------------------------------------- ---------- ------------
Balance at the end of the period/year 5,371,338 5,257,887
--------------------------------------------------- ---------- ------------
Accumulated operating losses at 31 October 2020 and 30 April
2020 in the table above relate entirely to discontinued operations
The value of deferred tax assets not recognised in regard to
operational losses amounted to GBP1,378,303 (30 April 2020:
GBP1,371,419), all of which related to discontinued operations.
Accumulated operating losses relating to continuing operations
at the period end amounted to GBP28,995,625 (30 April 2020:
GBP28,697,034). No deferred tax assets arose in respect of these
losses.
At the period end the Group had accumulated capital losses of
GBP2,655,836 (30 April 2020: GBP2,860,365). The accumulated capital
losses at 31 October 2020 and 30 April 2020 related entirely to
discontinued operations. The value of deferred tax assets not
recognised in respect of these capital tax losses amounted to
GBP902,984 (30 April 2020: GBP972,524), all of which related to
discontinued operations.
Deferred taxation
As at 31 October 2020 and 30 April 2020 the Group had no
deferred tax liabilities or recognised deferred tax assets.
8. Basic and diluted loss per share
The calculation of the basic and diluted loss per share in total
and for continuing and discontinued operations is based on the
following loss attributable to shareholders and weighted average
number of shares outstanding.
For the
six months
For the six ended
months ended 31 October
31 October 2020 2019
Unaudited Unaudited
GBP GBP
------------------------------------------------------------------------ ------------
Loss for the purposes of basic and diluted earnings
per share being net loss for the period (701,471) (654,381)
------------------------------------------------------------ ---------- ------------
Loss for the purposes of basic and diluted earnings
per share being net loss for the period from continuing
operations (298,591) (284,750)
------------------------------------------------------------ ---------- ------------
Loss for the purposes of basic and diluted earnings
per share being net loss for the period from discontinued
operations (402,880) (369,631)
------------------------------------------------------------ ---------- ------------
31 October 2020 31 October
Unaudited 2019
Weighted average number of shares Unaudited
-------------------------------------- ------------------------------------- -------------
Issued shares brought forward (note 14) 73,728,284 74,117,299
Issued shares carried forward (note 14) 73,728,284 73,728,284
Weighted average number of shares in issue during the
period 73,728,284 73,806,510
---------------------------------------------------------------- ----------- -------------
Basic and diluted loss per share (0.95) (0.89) pence
pence
---------------------------------------------------------------- ----------- -------------
Basic and diluted loss per share from continuing operations (0.40) (0.39) pence
pence
---------------------------------------------------------------- ----------- -------------
Basic and diluted loss per share from discontinued (0.55) (0.50) pence
operations pence
---------------------------------------------------------------- ----------- -------------
9. Net asset value
31 October 30 April
2020 2020
Unaudited Audited
Total assets 8,330,616 9,491,957
Total liabilities 1,834,113 1,788,271
-------------------------------------- ----------- -----------
Net asset value 6,496,503 7,703,686
-------------------------------------- ----------- -----------
Number of shares in issue (note 14) 73,728,284 73,767,611
-------------------------------------- ----------- -----------
Net asset value per share 8.8 pence 10.4 pence
-------------------------------------- ----------- -----------
10. Investment property and plantations
The Group's investment property and plantations are classified
as disposal group and assets held for sale.
The Group engages external independent professional valuers to
estimate the market values of the investment properties and
plantations in Brazil on an annual basis, with the Operations
Manager providing a desktop update valuation for the purposes of
the Group's Interim Financial Statements.
The investment property is carried at its estimated fair value
and plantations are carried at their estimated fair values less
costs to sell as at 31 October 2020 and 30 April 2020, as
determined by the Directors taking into consideration the external
independent professional valuers' valuations, the latest offers
received for the investment property and plantations and the
Directors' assessment of other factors that may influence
prospective purchasers.
The fair value measurements of investment properties and
plantations have been categorised as Level 3 fair values based on
the unobservable nature of significant inputs to the valuation
techniques used.
Notwithstanding the results of the independent valuations, the
Directors make their own judgement on the valuations of the Group's
investment property and plantations, with reference to the views of
the Operations Manager, other advisors and the latest offers
received.
(i) Plantations
In forming their conclusions of the fair value of the investment
property and plantations, the Directors have considered the
following factors:
Property Fair value Valuation Significant unobservable Inter-relationship
technique inputs between key unobservable
inputs and fair
value measurement
31 30
October April
2020 2020
GBPm GBPm
-------- ------
a) Minas - 0.4 31 October
Gerais 2020
- Ribeirao N/A
do Gado
30 April 2020 * Sale price agreed The estimated
In accordance fair value would
with increase/(decrease)
sale * Discount rate: 8% if:
agreement * the agreed sale price were higher/(lower)
completed
after * Estimated costs to sell: 5%
the year end, * the discount rate were lower/(higher)
discounted
to adjust for
partially * estimated costs to sell were lower/(higher)
deferred
settlement
-------- ------ --------------- ------------------------------------------------------------ --------------------------------------------------------------
b) Minas 0.6 0.6 31 October
Gerais 2020 * Sale price agreed The estimated
-Forquilha In accordance fair value would
with increase/(decrease)
sale * Discount rate: 10% if:
agreement * the agreed sale price were higher/(lower)
completed
during * Estimated costs to sell: 5%
the period, * the discount rate were lower/(higher)
discounted
to adjust for
partially * estimated costs to sell were lower/(higher)
deferred
settlement
The estimated
* Estimated log prices per m3, being standing prices fair value would
with the buyer absorbing all the costs of harvesting increase/(decrease)
30 April 2020 and haulage: BRL 36.64 - BRL 41.34 if:
Market * estimated log prices were higher/(lower)
approach,
using prices * Discount rate: 8%
and * the discount rate were lower/(higher)
other
information * Estimated costs to sell: 5%
generated by * estimated costs to sell were lower/(higher)
identical
or comparable
market
transactions,
discounted
to adjust for
deferred
settlement
-------- ------ --------------- ------------------------------------------------------------ --------------------------------------------------------------
c) 3R 0.4 0.5 31 October
Tocantins 2020
and * Sale price subject to final agreement The estimated
30 April 2020 fair value would
In accordance increase/(decrease)
with * Discount rate: 8% if:
sale * regeneration costs were higher/(lower)
agreement
in discussion * Estimated costs to sell: 5%
after * estimated costs to sell were lower/(higher)
the period
end,
discounted to
adjust
for partially
deferred
settlement
-------- ------ --------------- ------------------------------------------------------------ --------------------------------------------------------------
Total 1.0 1.5
-------- ------ --------------- ------------------------------------------------------------ --------------------------------------------------------------
Cambium Global Timberland Limited
(i) Plantations (continued)
(i) a) Plantations -Ribeirao do Gado
During the prior year, the Group agreed a contract to sell the
entire Ribeirao do Gado property for GBP1.0 million (BRL 7.0
million). This contract was completed in May 2020, with settlement
taking place over the 33 months ending in January 2023.
(i) b) Plantation - Forquilha
During the period, the Board agreed a contract for the sale of
the plantations for an amount of GBP0.7 million ((BRL 5.2 million),
with settlement taking place over 24 months from the commencement
of harvesting. The Board has determined that the Forquilha
plantations should be valued on the basis of this contract, less an
estimated discount for deferred settlement (30 April 2020:
independent valuer's valuation of GBP0.8 million (BRL 4.7
million)), and accordingly the Forquilha plantations are valued in
these interim financial statements at GBP0.6 million (BRL 4.7
million) (30 April 2020: GBP0.7 million (BRL 4.7 million)), which
the Directors believe represents a reasonable estimation of the
fair value of the plantations as at 31 October 2020 before
estimated selling costs of GBP0.03 million (30 April 2020: GBP0.03
million). As at 31 October 2020, harvesting had not commenced, and
no sales proceeds had yet been received.
(i) c) Plantation - 3R Tocantins
During the prior year, the Group entered into discussions, which
are still in progress as at 31 October 2020, to sell the land and
plantations at the 3R property for GBP2.5 million (BRL 18.5
million), with settlement taking place over 31 months. GBP0.5
million (BRL 3.9 million) (30 April 2020: GBP0.6 million (BRL 3.9
million)) is attributable to the plantations, based on the
valuation provided by the independent valuer at 30 April 2020. The
Board has determined that the plantations should be valued on the
basis of this agreement in negotiation, less an appropriate
discount for deferred settlement, and accordingly the 3R
plantations are valued in these financial statements at GBP0.4
million (BRL 3.4 million) (30 April 2020: GBP0.5 million (BRL3.4
million) before estimated selling costs of GBP0.03 million (30
April 2020: GBP0.03 million). The agreement for sale of the land
and plantations was completed in December 2020 (see note 20).
(ii) Investment property
Property Fair value Valuation Significant unobservable Inter-relationship
technique inputs between key unobservable
inputs and fair
value measurement
31 30
October April
2020 2020
GBPm GBPm
-------- ------
a) Minas 31 October
Gerais - 2020 N/A N/A
Ribeirao - 0.4 N/A
do Gado
30 April 2020 * Sale price agreed The estimated
In accordance fair value would
with sale increase/(decrease)
agreement * Discount rate: 10% if:
completed * the agreed sale prices were higher/(lower)
after
the year end, * Estimated costs to sell: 5%
discounted to * the discount rate were lower/(higher)
adjust for
partially
deferred * estimated costs to sell were lower/(higher)
settlement
-------- ------ -------------- ------------------------------------------------------------ ---------------------------------------------------
b) Minas 31 October
Gerais 2020
-Forquilha 1.7 1.9 and * Land value per hectare: BRL 1,108 - BRL 2,406 (2019: The estimated
30 April 2020 BRL 1,426 - BRL 4,455) fair value would
Direct increase/(decrease)
comparative if:
approach. * Discount rate: 8% * land values were higher/(lower)
Considers
the bare land
price from * Estimated costs to sell: 5% * the discount rate were lower/(higher)
comparable
transactions,
soil quality, * estimated costs to sell were lower/(higher)
and
topography
of the land,
access
and distance
from
cities and
the
proportion of
the property
which
could be used
for
cultivation.
-------- ------ -------------- ------------------------------------------------------------ ---------------------------------------------------
(table continues)
(ii) Investment property (continued)
Property Fair value Valuation Significant unobservable Inter-relationship
technique inputs between key unobservable
inputs and fair
value measurement
31 30
October April
2020 2020
-------- ------
GBPm GBPm
-------- ------
c) 3R 1.7 1.8 31 October
Tocantins 2020
and * Sale price agreed The estimated
30 April fair value would
2020 increase/(decrease)
In * Discount rate: 8% if:
accordance * the sale price were higher/(lower)
with sale
agreement * Estimated costs to sell: 5%
in * the discount rate were lower/(higher)
discussion
after the
year * estimated costs to sell were lower/(higher)
end,
discounted
to adjust
for
partially
deferred
settlement
-------- ------ ----------- -------------------------------------- ---------------------------------------------------
Total 3.4 4.1
-------- ------ --------------------------------------------------------------------------------------------------------
(ii) a) Investment property - Ribeirao do Gado
During the prior year, the Group agreed a contract to sell the
entire Ribeirao do Gado property for GBP1.0 million (BRL 7.0
million). This contract was completed in May 2020, with settlement
taking place over the 33 months ending in January 2023.
(ii) b) Investment property - Forquilha
The independent valuer has valued the investment property held
for sale in Forquilha, the third farm in the Minas Gerais property,
at GBP2.1 million (BRL 15.5 million) (30 April 2020: GBP2.2 million
(BRL 15.5 million)). As at 31 October 2020, the Directors believe
this represented a reasonable estimation as at that date of the
likely realisation proceeds in the event of a sale of the land. In
arriving at this likely realisation valuation, the Directors have
also considered the high proportion of unproductive land in the
property, the sales prices achieved by the Company at its other
properties in Minas Gerais during the prior year and the current
period, and the current wood prices prevailing in the region as an
indicator of the economic potential of the land. Further, the
Directors are involved in negotiations to sell the property and the
land value implicit in the informal offers received by the Group
during the period materially supports the independent valuer's
appraisal of the likely realisation value.
Further, the Directors consider it appropriate to discount the
realisation valuation, as presented by the independent valuer, for
the expected deferred settlement of any likely realisation proceeds
and for the impact of any related costs to sell. Accordingly, the
Forquilha land has been valued at GBP1.8 million (BRL 13.6 million)
(30 April 2020: GBP2.0 million (BRL 13.6 million)) inclusive of
discounting of GBP0.3 million (BRL 1.9 million), before estimated
selling costs of GBP0.1 million (BRL 0.7 million).
Two separate agreements with different purchasers (of which one
is conditional) for the sale of the Forquilha land were completed
in December 2020, with settlement taking place over 24 months
ending in December 2022 (see note 20).
(ii) d) Investment property - 3R Tocantins
During the prior year, the Group entered into discussions, which
were still in progress as at 31 October 2020, to sell the land and
plantations at the 3R property for GBP2.5 million (BRL 18.5
million), with settlement taking place over 31 months. GBP2.0
million (BRL 14.6 million) of this amount is attributable to the
land, after attributing GBP0.5 million (BRL 3.9 million) to the
plantations, based on the valuation provided by the independent
valuer. The Board has determined that the investment property
should be valued on the basis of this agreement in negotiation,
less an appropriate discount for deferred settlement, and
accordingly the 3R land is valued in these financial statements at
GBP1.8 million (BRL 12.9 million) (30 April 2020: GBP1.9 million
(BRL12.9 million) before estimated selling costs of GBP0.09
million. The agreement for sale of the land and plantations was
completed in December 2020 (see note 20).
The Group is exposed to a number of risks related to its tree
plantations:
Regulatory and environmental risks
The Group is subject to laws and regulations in the countries in
which it operates. The Group has established environmental policies
and procedures aimed at compliance with local environmental and
other laws. The Operations Manager performs regular reviews to
identify environmental risks and to ensure that the systems in
place are adequate to manage those risks.
Supply and demand risk
The Group is exposed to risks arising from fluctuations in the
price and sales volume of trees. The Group intends to manage this
risk by aligning its harvest volume to market supply and demand.
The Operations Manager performs regular industry trend analyses to
ensure that the Group's pricing structure is in line with the
market and to ensure that projected harvest volumes are consistent
with the expected demand.
Climate and other risks
The Group's plantations are exposed to the risk of damage from
climatic changes, diseases, forest fires and other natural forces.
The Group has processes in place aimed at monitoring and mitigating
those risks, including regular forest health inspections and
industry pest and disease surveys.
11. Disposal group and assets held for sale and discontinued
operations
During the period, the Group continued its strategy for orderly
realisation of the remaining assets in Brazil, in accordance with
the Shareholder Update announcement made on 6 October 2015.
The assets in Brazil are ultimately likely to be sold through a
disposal of the entities owning the assets. Accordingly, as at 31
October 2020, the Group's Brazil segment is presented as a disposal
group held for sale.
The Brazil disposal group comprises the following assets and
liabilities held for sale:
Liabilities 30 April
Assets held for 31 October 2020
held for sale sale 2020 Unaudited Audited
GBP GBP GBP GBP
----------------------------- --------------- ------------ ---------------- ----------
Investment property 3,383,772 - 3,383,772 4,058,634
Plantations 1,033,131 - 1,033,131 1,485,373
Trade and other receivables 63,359 - 63,359 64,299
Trade and other payables - (56,244) (56,244) (46,269)
4,480,262 (56,244) 4,424,018 5,562,037
----------------------------- --------------- ------------ ---------------- ----------
A loss of GBP504,912 (2019: loss of GBP256,300) related to the
Brazil disposal group, representing foreign exchange translation of
discontinued operations, is included in other comprehensive income
(see note 13).
Total assets held for sale in the statement of financial
position are as follows:
31 October 2020 30 April
Unaudited 2020
Audited
GBP GBP
---------------------------------------------------------------------- ------------
Balance brought forward 5,608,306 14,292,311
Decrease in trade and other receivables (940) (38,870)
Costs capitalised to land and plantations - 105,317
Net proceeds received from disposals of assets held
for sale (1,106,244) (5,173,865)
Loss on disposal of assets held for sale - (20,696)
Increase in the fair value of disposal group and assets
held for sale - (1,637,347)
Foreign exchange effect (20,860) (1,918,544)
-------------------------------------------------------- ------------ ------------
4,480,262 5,608,306
---------------------------------------------------------------------- ------------
As at 31 October 2020 and 30 April 2020, the assets held for
sale were all located in Brazil.
The fair value measurement of GBP4,480,262 has been categorised
as a Level 3 fair value based on the appraised fair values of the
investment property and the appraised fair values of the
plantations less costs to sell. These assets were measured using
the methods outlined in note 10. The fair value of other assets and
liabilities within the disposal group is not significantly
different from their carrying amounts.
Net cash flows attributable to the discontinued operations were
as follows:
For the six For the
months ended six months
31 October ended
2020 31 October
Unaudited 2019
Unaudited
GBP GBP
------------------------------------------------------------------------ ------------
Operating activities
Loss for the period before taxation (402,880) (369,631)
Adjustments for:
Loss on disposal of assets held for sale - 69,086
Net finance costs 6,844 970
Decrease/(increase) in trade and other
receivables 14,090 (39,337)
Increase in trade and other payables 9,975 130,193
Net cash used in operating activities (371,971) (208,719)
Net cash from investing activities (proceeds of disposal
of assets held for sale less costs capitalised to
plantations) 1,106,244 399,054
Net cash used in financing activities (net finance
costs) (6,844) (970)
Foreign exchange movements (76,758) (15,895)
Net cash inflow for the period 650,671 173,470
-------------------------------------------- -------------------------- ------------
12. Trade and other receivables
31 October 2020 30 April
2020
GBP GBP
--------------------------------------------------------------- ----------
Non-current
Agua Santa sales proceeds receivable 445,120 1,441,991
Ribeirao do Gado sales proceeds receivable 302,609 -
--------------------------------------------------- ---------- ----------
747,729 1,441,991
--------------------------------------------------- ---------- ----------
Current
Agua Santa sales proceeds receivable 1,723,767 1,734,316
Ribeirao do Gado sales proceeds receivable 297,935 -
Rental escrow accounts receivable 38,226 52,316
Prepaid expenses 29,421 29,416
--------------------------------------------------- ---------- ----------
2,089,349 1,816,048
--------------------------------------------------- ---------- ----------
Total trade and other receivables 2,837,078 3,258,039
--------------------------------------------------- ---------- ----------
13. Foreign exchange effect
The translation reserve movement in the period, all of which was
derived from discontinued operations, has arisen as follows:
Exchange Exchange Translation
rate at rate at reserve
31 October 30 April movement
31 October 2020 2020 2020 Unaudited
------------------------- ------------ ---------- ------------
Discontinued operations
Brazilian Real 7.4401 6.9081 (504,912)
United States Dollar 1.2947 1.2594 (800)
------------------------- ------------ ---------- ------------
(505,712)
--------------------------------------------------- ------------
Exchange Exchange Translation
rate at rate at reserve
31 October 30 April movement
31 October 2019 2019 2019 Unaudited
Discontinued operations
Brazilian Real 5.2017 5.1067 (256,300)
United States Dollar 1.2942 1.3032 56
------------------------- ------------ ---------- ------------
242,360
--------------------------------------------------- ------------
14. Stated capital
31 October 2020 30 April
Unaudited 2020
Audited
GBP GBP
----------------------------------------------------------------- ----------
Balance brought forward and carried forward 2,000,000 2,000,000
----------------------------------------------------- ---------- ----------
The total authorised share capital of the Company is 250 million
shares of no par value. On initial placement 104,350,000 shares
were issued at 100 pence each. Shares carry no automatic rights to
fixed income but the Company may declare dividends from time to
time to which shareholders are entitled. Each share is entitled to
one vote at meetings of the Company.
On 22 February 2007, a special resolution was passed by the
Company to reduce the stated capital account from GBP104,350,000 to
GBP2,000,000. Approval was sought from the Royal Court of Jersey
and was granted on 29 June 2007. The balance of GBP102,350,000 was
transferred to a distributable reserve on that date.
The Company was granted authority by shareholders on 15 August
2008 to make market purchases of its own shares, an authority which
has been renewed annually thereafter, most recently on 20 September
2018. However no such authority was sought at the Company's 2019
AGM, and on 17 December 2019, the Board resolved that no further
share buybacks would be contemplated until further notice.
Movements of shares in issue
For the six For the
months ended six months
31 October 2020 ended
Unaudited 31 October
2019
Unaudited
Number Number
------------------------------------------------ ------------
Brought forward 73,728,284 74,117,299
Share buy-backs during the period - (389,015)
In issue at 31 October fully paid 73,728,284 73,728,284
----------------------------------- ----------- ------------
15. Reserves
The movements in the reserves for the Group are shown in the
Statement of Changes in Equity.
Translation reserve
The translation reserve contains exchange differences arising on
consolidation of the Group's foreign operations (see note 13).
Distributable reserve
In June 2007, the Company reduced its stated capital account and
a balance of GBP102,350,000 was transferred to distributable
reserves. This reserve has been utilised by the Company to purchase
its own shares (as at 30 April 2020: GBP7,237,888) and for the
payment of total cumulative dividends of GBP12,508,800, leaving a
balance at 31 October 2020 of GBP82,603,312 (30 April 2020:
GBP82,603,312).
16. Net asset value reconciliation
For the year For the six
For the six ended months ended
months ended 30 April 31 October
31 October 2020 2020 2019
Unaudited Audited Unaudited
GBP GBP GBP
-------------------------------------------------------- ------------- --------------
Net asset value brought forward 7,703,686 13,947,395 13,947,395
Foreign exchange translation differences (505,712) (3,239,954) (256,244)
Loss on disposal of assets held for sale - (20,696) (69,086)
Decrease in the fair value of investment
property and plantations - (1,637,347) -
Share buy-backs - (44,931) (44,931)
Net finance costs and exchange differences
- continuing operations (58,888) (117,278) (56,542)
Net finance costs and exchange differences
- discontinued operations (70,411) (125,624) 1,576
Loss before above items (572,172) (1,057,879) (530,329)
Net asset value carried forward 6,496,503 7,703,686 12,991,839
-------------------------------------------- ---------- ------------- --------------
17. Related party transactions
During the period the Directors received the following
remuneration in the form of fees from the Company:
For the six For the
months ended six months
31 October 2020 ended
Unaudited 31 October
2019
Unaudited
GBP GBP
---------------------------------------------- ------------
Antony Gardner-Hillman 24,000 24,000
Svante Adde 12,500 12,500
Mark Rawlins (appointed 1 May 2020) 12,500 -
Roger Lewis (resigned 30 April 2020) - 12,500
49,000 49,000
---------------------------------------------- ------------
Robert Rickman was paid GBP53,000 (2019: GBP53,000) in the
period as remuneration in his role as Operations Manager (see note
4).
At the period end, Directors held the following interests in the
shares of the Company:
31 October 2020 30 April
Unaudited 2020
Audited
Number Number
------------------------------------------------------------- ---------
Svante Adde 160,840 160,840
160,840 160,840
------------------------------------------------------------- ---------
18. Loan payable to related party
In December 2017, the Group agreed an unsecured loan funding
facility with Peter Gyllenhammar AB ('PGAB'), the Company's largest
shareholder, for approximately GBP1.4 million, in order to enable
the Group to remove outstanding mortgages over the Group's 3R
Tocantins property without depleting existing cash balances.
The interest rate on the loan was 6% for the first 12 months and
thereafter 8%. PGAB agreed not to have recourse against the
existing cash balances. There is no specified repayment date (and
consequently no default interest rate) and the Company is only
required to repay the loan or pay interest out of cash flow from
the land and/or timber assets presently held in Brazil which is
surplus to requirements. The loan agreement contains borrower
covenants requiring lender consent for the Company to return to
shareholders in excess of approximately GBP 2,000,000 of the cash
held at the date of the agreement, to purchase own shares for more
than 12p per share, to declare or pay any dividend, or to make any
significant new investment (not including asset maintenance or
repair costs). During the period, no repayments of principal or
interest were made.
19. Contingent asset
Until it was settled by the Group on 21 December 2017, there
existed a security interest on the property owned by 3R Tocantins
Florestais Ltda. ("3R Tocantins") to cover a liability between the
previous owners and Banco da Amazonia (BASA), a financial
institution which lent money to the previous owners who used the
property as collateral. The liability to BASA was settled in the
prior year, however 3R Tocantins retains a security interest on
Lizarda, another property of the previous owners, as cover for this
potential liability. A valuation completed in December 2013 valued
this property at BRL 7.7 million (GBP1.0 million), however the
security on this property may have been limited to BRL 5.0 million
(GBP0.7 million) and may not be enforceable. The Group continues to
explore legal options in relation to the Lizarda security interest,
and in the event that it is successful in enforcing this interest,
the Lizarda property may become an asset of the Group.
20. Events after the reporting period
On 7 December 2020, the Company announced that it had signed an
agreement for the sale of the 3R land and plantations in Tocantins
state for a consideration of BRL 18.5 million (GBP2.7 million),
with BRL 18.1 million payable immediately, and the balance of BRL
0.4 million to be paid pro-rata on the resolution of a dispute with
third parties relating to the possession of a small area of
land.
On 8 December 2020, the Company announced that it had signed two
separate agreements (one of them conditional) with different
purchasers for the sale of the land at Forquilha in Minas Gerais
state. The agreements provide for a combined consideration for the
two sales of BRL 18.9 million (GBP2.7 million), with settlement
taking place over 24 months.
The Company is pursuing discussions with a potential purchaser
of the remaining non-cash assets, with the aim of bringing forward
the collection by the Company of all receivables arising from
deferred payment terms applicable to the sales of investment
properties. The aim of the Board is to facilitate an earlier return
of capital to shareholders in the course of a winding up than would
otherwise be the case.
There were no other significant events after the period end
which, in the opinion of the Directors, require disclosure in these
interim financial statements.
Key Parties
Directors
Antony R Gardner-Hillman (Chairman)
Svante Adde
Mark Rawlins (appointed 1 May 2020)
Registered Office of the Company
Charter Place
23-27 Seaton Place
St Helier
Jersey JE1 1JY
Operations Manager
Robert Rickman
Belsyre Court
57 Woodstock Road
Oxford OX2 6HJ
Sub-Administrator
Praxis Fund Services Limited
PO Box 296
Sarnia House
St Peter Port
Guernsey GY1 4NA
Administrator and Company Secretary
Praxis Fund Services (Jersey) Limited
Charter Place
23-27 Seaton Place
St Helier
Jersey JE1 1JY
Auditor
KPMG Channel Islands Limited
37 Esplanade
St Helier
Jersey JE4 8WQ
Registrar, Paying Agent and Transfer Agent
Link Market Services Limited
6(th) Floor, 65 Gresham Street
London EC2V 7NQ
Corporate Broker and Nominated Adviser for AIM
WH Ireland Limited
24 Martin Lane
London EC4R 0DR
Property Valuers
Holtz Consultoria Ltda
Republica Argentina Av. 452
Curitiba
Agua Verde 80240-210
Brazil
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IR BRGDBXSDDGBC
(END) Dow Jones Newswires
January 29, 2021 12:46 ET (17:46 GMT)
Cambium Global Timberland (LSE:TREE)
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Cambium Global Timberland (LSE:TREE)
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