Obtala Ltd (OBT)

 
Obtala Resources Plc: The Times They Are A-Changin’

By Hybridan | 22/10/2015

Obtala Resources to some looks like your average run of the mill mining company on AIM. This couldn’t be further from the truth as upon closer inspection one can find a fully functioning vertically integrated agribusiness, timber and retail business. Kevin Milne, Executive Deputy Chairman was appointed to the Board in August 2015 as part of a wider push to strengthen the management team and to refocus the business going forward. The interim results announced in September portrayed a strong platform for growth reporting revenues of £2.3m, net profit of £3.02m with net assets of £95.8m. The company’s three core businesses cover farming, retail and timber and are purely focused on Africa which is set to take advantage of the continent’s unprecedented rates of growth fuelling growth in domestic consumer demand. The farming division operates a “seed to fork” strategy from horticulture to branded product ranges including dried fruit and chilli based sauces taking advantage of the whole value chain in food production. In Tanzania, 530 Ha are held under long lease agreements with 80 Ha currently cultivated with up to four crops per year per hectare. Earlier this year Obtala received the internationally recognised farm GLOBALG.A.P certification which allows them to overcome significant barriers to entry with many international food groups. GLOBAL.G.A.P is the internationally recognised standard for farm production which will support the company in broadening their partnerships with various trade partners as they look to develop more land. The retail division looks to capitalise on Africa’s emerging middle class, grown to some 400 million people. Six multi product department stores are currently operating in Lesotho with further in-country expansion planned for additional three to four units over the next 12 months. The division is well established and currently embarking on further improvements with enhancements to their ordering systems, stock management and cost control. There is future scope to roll out in Southern and East Africa where Obtala has an already existing presence. Under the company’s recent strategic review, there is a proposed spin out of their forestry division to be quoted on AIM. Africa accounts for 17% of Global forest cover but only 4% of global round wood and less than 2% of global sawn wood production. The company is, subject to local Government approval, completing the acquisition of 50 year leases for two new timber concessions totalling 35,000 Ha in Mozambique to bring the total forestry area to 314,965 Ha. Honour Capital prepared a valuation report in June 2014 which attributed a NPV to Obtala’s timber business of US$161m at a 12% discount based on a ten year cash flow model. The 2014 valuation was based on eleven concessions with a total land area of 279,965 Ha. This puts Obtala in a strong position to become a leading supplier in a market that is facing increasing global demand for high quality timber with new suppliers being curtailed by strict environmental and conservation laws. Obtala Resources has successfully repositioned itself as a socially responsible company which is debt free and diversified both geographically and by sector. It is trading at a deep discount to NAV and we believe the current management team in place are executing a strategy which will bring rapid improvements in the operational performance of their portfolio.

Latest NewsMore

MOU to Promote Legal & Sustainable Processing

RNS Number: 3860B Obtala Limited 09 January 2018 9 January 2018 Obtala Limited ("Obtala", the " Group " or the "Company") (AIM: OBT) MOU to Promote Legal and Sustainable Processing of Timber in Mozambique Non-binding MOU signed with FundInvest SA, an investment company established by the Ministry of Land, Environment and Rural Developme...

Obtala forecasts record annual revenue

Obtala said it expected to post record levels of annual revenue after it boosted forestry production in the fourth quarter. A...

Q4 2017 Quarterly Business Update

RNS Number: 1634B Obtala Limited 08 January 2018 8 January 2018 Obtala Limited ("Obtala", the " Group " or the "Company") (AIM: OBT) Q4 2017 Quarterly Business Update Q4 2017 momentum to result in record annual revenue for Obtala, with contribution from all divisions; forestry production, timber trading and agriculture First step in expansion of timber...

Obtala looks to expand timber division

Obtala says it has taken the first step in expanding its timber trading division by securing an initial $1m of loan capital at a...

First Step in Expansion of Timber Trading Division

RNS Number: 9876A Obtala Limited 04 January 2018 4 January 2018 Obtala Limited ("Obtala", the " Group " or the "Company") (AIM: OBT) First Step in Expansion of Timber Trading Division Obtala Limited (AIM: OBT), the African focused agricultural and forestry company, is pleased to announce the first step in the expansion of its Timber Trading Division. In...

Obtala directors lend money to Hong Kong arm

Africa-focused agribusiness Obtala said its Hong Kong subsidiary had sourced a new loan to fund its timber trading activ...

Trade Finance Update

RNS Number: 5925A Obtala Limited 02 January 2018 02 January 2018 Obtala Limited ("Obtala", the " Group " or the "Company") (AIM: OBT) Trade Finance Update Obtala Limited (AIM: OBT), the African focused agricultural and forestry company, is pleased to announce the initial funding of Obtala (Hong Kong) Limited (a wholly subsidiary of the Company) th...

Final Appointment of Nominated Adviser

RNS Number: 4211Z Obtala Limited 15 December 2017 15 December 2017 Obtala Limited ("Obtala", the "Group" or the "Company") (AIM: OBT) Appointment of Nominated Adviser and Broker Finalised Obtala Limited (AIM: OBT), the African focused agricultural and forestry company, is pleased to announce that further to the Company's announcements dated 16...

Obtala Resources Limited Research

hardman & co
Obtala Resources Limited
05/06/2017
Under new leadership and strengthened operational management, Obtala Ltd, the African agricultural and forestry business, is setting about commercialising the substantially untapped potential of its...

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