OKOMU OIL PALM : AUDITED FINANCIAL STATEMENT FOR 2021

THE OKOMU OIL PALM COMPANY PLC
Report of the directors and audited financial statements
for the year ended 31 December 2021
Table of Contents	Page
Corporate Information	3
Results at a glance	4
Chairman's report	5
Report of the directors	8
Corporate governance report	13
Report of the audit committee	21
Certificate of account	22
Statement of directors' responsibilities	23
Independent auditor's Report	24
Statement of profit or loss and other comprehensive income	27
Statement of financial position	28
Statement of changes in equity	29
Statement of cash flows	30
Notes to the financial statements	31
Other national disclosures:
- Value added statement	77
- Five-year financial summary	78

THE OKOMU OIL PALM COMPANY PLC Corporate information for the year ended 31 December 2021

Registered Company number

30894

Directors

Mr. Gbenga Oyebode MFR

Dr. Graham Hefer (South African) Mr. Arnaud Arhainx (French)

Dr. Luc Boedt (Belgian) Chief David Edebiri OON Mr. Peter Eguasa JP

Mr. Hubert Fabri (Belgian)

Mr. Regis Helsmoortel (Belgian)

Mr. Philippe De Traux De Wardin (Belgian) Mr. Sven Claeys (Belgian)

Mr. Asue Ighodalo

Mrs. Vivien Shobo

Chairman Managing Director Finance Director/CFO Non Executive Director Non Executive Director Non Executive Director Non Executive Director Non Executive Director Non Executive Director Non Executive Director Non Executive Director Independent Director

Registered OfficePrincipal Place of BusinessCompany SecretaryIndependent Auditors

Okomu Oil Palm Estate Okomu-Udo

Edo State

Okomu Oil Palm Estate Okomu-Udo

Edo State

P.C. Obi & Co. represented by Chukwuebuka Omerole

37 Norman Williams Street South-West Ikoyi

Lagos

Messrs. Ernst & Young 10th & 13th Floors, UBA House 57 Marina

Lagos

Bankers

Access Bank Plc Polaris Bank Limited Zenith Bank Plc

Foreign Bankers

Banque Cantonale de Fribourg Freiburger Kantonal Bank

Solicitors

Chief Charles Adogah & Co (Solicitors & Advocates)

34 Oziegbe Street, New Benin Benin City

Registrars

Cardinalstone Registrars Ltd. 358, Herbert Macaulay Way Yaba, Lagos

Managing Agent

Socfinco F.R. S.A Squares des Places 3 1700

Fribourg Switzerland

THE OKOMU OIL PALM COMPANY PLC Results at a glance for the year ended 31 December 2021

2021	2020	% change
₦'000	₦'000
*Restated
`	Revenue	37,394,507	23,410,680	60%
Profit before taxation	16,114,778	8,694,913	85%
Income tax expense	(4,575,810)	(5,752,445)	-20%
Profit for the year	11,538,968	2,942,468	292%
Other comprehensive income/(Loss)	560,687	(888,392)	-163%
Total comprehensive income	12,099,655	2,054,076	489%
Net asset	34,051,956	28,629,671	19%
Employee's expenses	1,294,000	1,104,709	17%
Number of employees	426	455
Basic earnings per share	12.10	3.08
Net asset per share	35.70	30.01

* Certain amounts shown here do not correspond to the 2020 audited financial statements and reflect adjustments made, refer to Note 4.19.

THE OKOMU OIL PALM COMPANY PLC

Chairman's report

Distinguished Shareholders, Guests of Honour, Ladies and Gentlemen, welcome to the 42nd Annual General Meeting of our Company. It is my pleasure to present to you the annual report and financial results for the year ended 31st December 2021.

The Operating & Economic Environment for 2021

Following the global economic crisis in the year 2020, as a result of Covid-19, it was expected that the global economy would begin to show signs of recovery in 2021. However, several countries continued to grapple with Covid-19 lockdowns and travel bans, which left many companies reeling from logjams in supply chains worldwide.

In Nigeria, notwithstanding her exit from a recession in the 4th quarter of 2020, triggered by the lockdown, its rippling effect still lingered on in 2021 as the nation witnessed a devastating surge in inflation, reaching the highest levels in four years, amid skyrocketing food prices and poor purchasing power. Worsening insecurity issues in the country, a persistent drop in crude oil prices, and a lack of forex also continued to hinder growth for most businesses on the verge of recuperating from the after-effects of Covid-19.

Commodity prices for both of our company's products increased during 2021. However, the lack of foreign exchange also assisted the company to sell our crude palm oil (CPO) into the local market without having to compete with illegal imports in the past year.

Operating Results

The past year saw a 53% increase in CPO prices year on year (YoY) whilst rubber prices increased by 39% (YoY). CPO production was nearly 3% higher than for the same period 2020, whilst rubber production was 26% higher (YoY). Consolidated turnover for the year increased YoY by 60%. Direct costs increased by 45% YoY.

The Company paid 20% lower Company income tax YoY.

In spite of the difficult 2021 business environment, I am pleased to announce that our company registered a total comprehensive income for 2021 of N12.0 billion, this being 489% higher than in 2020.

Dividends

The Board of Directors have therefore, recommended a dividend of N8:00 per ordinary share of 50 kobo each (2020: N7.00 per ordinary share of 50 kobo each) held, subject to the payment of withholding tax at the appropriate rate.

Operational Performance by Sector

Palm

As at the end of 2021, the total oil palm area was 19,060ha. No immature plantings or re-plantings were recorded. Total agricultural palm plantation costs for the year were 56% higher YoY.

Rubber

A total of 7,335ha of rubber were recorded at the end of 2021. No new rubber plantings or replants were done in 2021, nor any immature area opened for tapping. Dry rubber production reduced by 1.7% YoY, whilst rubber agricultural plantation costs increased by 31% when compared to 2020.

The rubber factory processed around 26% more dry rubber in 2021, compared with prior year