New Britain Palm Oil Ltd

New BritainPalm Oil Ltd2012

1


Preliminary Results 2011

February 2012

2

Recently upgraded facilities on New Britain

3


Introduction

• Record levels of oil palm fruit processed and palm oil produced during 2011

• Record revenue and earnings in 2011

• Clear growth strategy: plantation expansion onto grassland at RAMU, and margin growth at KPOL

• Total land holdings of 129,130 hectares, and 102,231 hectares under cultivation

• Unique vertical integration from seed to refined product

• Largest private employer in Papua New Guinea

• Plan at IPO in late 2007 to double plantation area in 7 - 8 years, achieved in 3

• Demand for palm oil as the cheapest vegetable oil foodstuff remains high and is aligned to the urbanisation of emerging economies and rise of the middle class

• New Britain Oils (downstream palm oil refining and processing) reporting excellent progress in Liverpool, UK

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NBPOL plantation in West New Britain, PNG

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Highlights - 2011

2011 2010FFB processed (million tonnes) 2.4 1.9

CPO / PKO produced (tonnes) 591,477 478,667

Average CPO price achieved ($ / tonne) $1,108 $850

2011 2010Revenue ($m) 780 461

EBITDA* ($m) 337 179

Profit before tax* ($m) 276 131

Earnings per share* (US ¢) 141 60

* Excluding IAS 41

21%

24%

69%

88%

110%

134%

30%

6

Nursery estates in New Britain

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Highlights - 2011

• Group had cash holdings at the end of 2011 of $60.1m, with a further $81.5m in trade oil debtors, which has subsequently been received

• At the end of 2011 forward sales of c.144,750 tonnes of CPO of 2012 production had been made at an average price of $1,057/tonne

• As at 15 February 2012 this figure was c.220,000 tonnes at an average price of $1,078/tonne

• Palm product extraction rates increased to 28.2% (2010: 27.5%)

• KPOL integration is making progress, with a contribution of $57.8m to PBT in 2011

• The performance of the Liverpool refinery has exceeded expectations and is currently achieving high utilisation rates, Bakery Fats plant has been commissioned

• Resumption of dividend in October 2011 with an interim payment of $0.15, a final dividend of $0.15 will be payable in April 2012, taking the full year gross 2011 dividend to $0.30 per NBPO share

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Milling in progress

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Historical Financials

NB

PO

L sh

are

pric

e (G

Bp)

CP

O $

/ M

T

2,000

1,800

1,600

1,400

1,200

1,000

800

600

400

1100

1000

900

800

700

600

500

400

300

200

10012/05 06/06 12/06 06/07 12/07 06/08 12/08 06/09 12/09 06/10 12/10 06/11 12/11

CPO CIF Rotterdam (US$/MT)

NBPOL share price (GBp)

2004 2005 2006 2007 2008 2009 2010 2011

Revenue

PBT

900

800

700

600

500

400

300

200

100

$m

Note: excluding effects of IAS41

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NBPOL nursery, critical for expansion schedule

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Growth in Group Fresh Fruit Bunch (FFB) volume

Historical Operational Indicators

Growth in Palm Oil Produced

Tonn

es

Growth in Oil Palm Plantations

30,000

35,000

0

15,000

20,000

25,000

2004 2006

Hec

tare

s

2005 2007

10,000

5,000

40,000

45,000

2008

55,000

60,000

50,000

65,000

70,000

2009 2010

CAGR:17.5%

75,000

2011

80,000

85,000

Tonn

es F

FB

2004 20062005 2007 2008 2009 2010 2011

2004 20062005 20082007 2009 20100

2011

200,000

240,000

80,000

120,000

160,000

40,000

280,000

320,000

360,000

400,000

440,000

CAGR: 16.3%480,000

520,000

560,000

600,000

1,400,0001,500,000

1,100,0001,200,0001,300,000

1,000,000

1,600,000

800,000

1,800,000

2,000,000

CAGR: 15.0%

1,900,000

1,700,000

900,000

2,100,0002,200,0002,300,0002,400,0002,500,000

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NBPOL and RAIL maintain a stock of cattle (of >19,000 head) utilising Palm Kernel Expeller, a high protein co-product of palm oil production

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Performance in Context NBPOL share price, CPO, FTSE 250

0

50

100

150

200

250

300

350

400

12/2007 06/2008 12/2008 06/2009 12/2009 06/2010 12/2010

100

= N

BP

OL

IPO

in L

ondo

n (D

ec. 2

007)

06/2011

450

12/2011 06/2012

CPO CIF Rotterdam

FTSE 250NBPOL share price

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Oil palm nursery

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Delivering Growth at NBPOL: Plantation expansion and margin growth

1. Plantation Expansion 2. Margin Growth

US

$/tC

PO

Cost of production (CoP) at NBPOLTotal NBPOL Land Bank

• The KPOL estates should, in time, deliver some of NBPOL’s most productive and highest margin estates

• CoP at KPOL should, in time, move toward or better the existing NBPOL estates

• Within its current land bank NBPOL has c.12,000 hectares of land designated for new oil palm plantations

• A further c.15,000 hectares of land is in the process of being acquired by NBPOL to ultimately form new oil palm plantations

01/01/2006 01/01/2007 01/01/2008 01/01/2009 01/01/2010 01/01/2011 01/01/20120

200

400

600

800

1,000

1,200

1,400CoP - West New Britain NBPOL estates

CoP - KPOL estatesCoP - NBPOL Group

CPO - CIF Rott

Existing NBPOL oil palm estates

Land owned and available for planting by NBPOL

NBPOL sugar estates

Land in process of acquisition

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Recently upgraded storage tanking owned by NBPO at Kimbe port, PNG

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Hectarage Valuation- The impact of KPOL

$27,562

$8,670

KPOL at time of acquisition

NBPOL(as at Jan 2012)

25,000

20,000

15,000

10,000

5,000

0

EV ($) / Mature Hectare

EV

($) /

Ha Taking into account mature

oil palm only and assuming c.68,000 managed mature hectares within the enlarged NBPOL group

30,000

35,000

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Harvesting techniques Pollinisation and breeding programme

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Global Edible Vegetable Oil Market

12.50

12.00

11.50

11.00

10.50

10.00

9.50

9.00

8.50

8.00

1989

/199

019

90/1

991

1991

/199

219

92/1

993

1993

/199

419

94/1

995

1995

/199

619

96/1

997

1997

/199

819

98/1

999

1999

/200

020

00/2

001

2001

/200

220

02/2

003

2003

/200

420

04/2

005

2005

/200

620

06/2

007

2007

/200

820

08/2

009

2009

/201

020

10/2

011

2011

/201

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Edible Oils - World Stocks:Usage Ratio (%)

Source: USDA

• Edible oils stocks:usage ratio continues to fall and palm oil prices continue to rise...

• ...in spite of an unprecedented increase in global palm oil production of 9% in 2011 to some 50m tonnes

%

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The controlled cultivation of oil palms in the nursery contributes to NBPOL’s successful replanting programme and relatively young oil palm age profile

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Palm Oil

• A vegetable oil used extensively in Asian and EU food markets and personal healthcare products• The most productive vegetable oil• High barriers to entry: significant capex requirement and logistic support plus 3 - 4 years for a new plantation

to yield fruit• High competition for suitable land

Source: USDA

Crop composition of land used globally to produce vegetable oils

Composition of global vegetable oil production

Soya

Sunseed

Rape

Palm 37%

16%11%

36%

62%17%

15%6%

NBPOL Example Customers

• Ferrero• Jordans• Wilmar• United Biscuits• c.90% of NBPOL’s output is sold into the EU in

US$ contracts Globally achieved Oil yield (tonnes / Ha)0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5

Palm Oil (World Average)

Rape

Sun

Soya Source: USDA/NBPOL5.0 5.5 6.0

Palm Oil (NBPOL)

6.5

Indicative oil yields

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Palm oil shipment from PNG into the UK refinery

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NBPOL Location

• 78,332 total hectares of managed oil palm plantations

• 68,438 hectares under harvest

• An additional c.42,000 hectares cultivated by smallholders

• 129,130 hectares of total land area with 102,231 under cultivation

PAPUA NEW GUINEA

NEW BRITAIN

NEW IRELAND

SOLOMONISLANDS

AUSTRALIA

•Kimbe

Main area of NBPOL operation36,126 hectares oil palm

Lae•

RAIL- acquired in Oct 200810,685 hectares oil palm7,720 hectares sugar cane8,888 hectares pasture

•

KPOL, Milne Bay- acquired in April 201011,134 hectares oil palm

•

KPOL, Higaturu- acquired in April 20108,533 hectares oil palm

•

GPPOL- acquired in April 20056,318 hectares oil palm

KPOL, Poliamba- acquired in April 20105,536 hectares oil palm

New Britain OilsThe first fully segregated and traceable sustainable palm oil refinery in the UK. New bakery foodstuffs facility now completed

•

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Sterilisation of palm fruits, key first stage processing

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NBPOL Today

Revenue contribution

Plantations • Land bank 129,130 ha• 78,332 hectares under NBPOL cultivation

with respect to oil palm• More than 42,000 mature hectares cultivated

by small-holders supplying NBPOL

Milling and Refining• 12 oil mills in Group• 2 refineries• Special fractionation plant completed for

Ferrero

Infrastructure• c.80,000 tonnes / oil storage capacity• Trucking transport fleet• Housing• Two new methane capture facilities nearing

completion• Export terminals

• Highly respected plant breeding research and development

• Important for success of wider business

• Growing customer base around the world

• NBPOL is one of the world’s largest private seed producers

• Seed sales up to 11.8m seeds in the period from 8.3m in the last period

• 8,888 hectares of cattle grazing land• Integrated with the palm oil plantation• Important for the protein constrained

local community• >20,000 head of cattle

RAIL• 1 sugar mill• 1 ethanol plant• 7,720 hectares sugar cane

Palm Oil Sales

Seed Sales

Cattle Production

Sugar sales

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CPO being loaded at West New Britain, PNG CPO arrival storage tanks at New Britain Oils, UK

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New Britain Oils

• Complete and operational

• Running ahead of internal utilisation targets

• Officially opened by the PNG High Commissioner in London, Ms Jean Kekedo on 25th August 2010

• World’s first dedicated sustainable bakery foodstuffs production facility now commissioned

• Key contracts with well known UK and EU brands

• Captures greater margin share for NBPOL

• First palm oil refinery in the EU to have a fully segregated and sustainable supply chain

• The first palm oil provider able to guarantee fully traceable, sustainable palm oil direct from the plantation to the EU consumer

• Further investment will continue in 2012/13

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Grassland and pasture available for planting in the Ramu Valley, incredible expansion potential

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RAIL

• Acquired in October 2008

• c.30,000 hectares of land

• Incredible expansion potential onto grassland

• 10,685 hectares of oil palm

• 7,720 hectares of sugar cane

• Oil palm planting and optimisation continues

• Extensive grasslands available for planting, key expansion area for NBPOL

• Continued high priced sugar market continues the positive outlook

• Sugar sales contributed a gross profit of $27.4m to the group (2010: $21.4m)

Ramu Agri Industries Ltd (RAIL)

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NBPOL facilities on New Britain, PNG

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Balance Sheet - 2011

0

50

100

150

200

250

RAMUShort term financing -Liverpool refinery

KPOL facility

• Current debt of c.$315m• 2011 Net Cash balance: $55m• 2011 EBITDA: $337m• Trailing year net debt/EBITDA: 0.8x (2010: 1.6x)

$m

300

350

Current Debt Position

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Replanting programme in process on West New Britain, PNG

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Corporate Structuring

• NBPOL’s standing with the provincial governments in PNG is critical and contributes to NBPOL’s success

• Facilitating NIDC and IPBC to swap into NBPOL shares will strengthen this positive relationship

• Shares acquired from KPOL and Poliamba are likely to enhance the US$/hectare valuation of NBPOL and enhance earnings per NBPOL share

• >99.9% of NBPOL shareholders voting at the EGM on 30 January 2012 voted in favour of disapplying pre-emption for up to a five percent issue of NBPOL shares to enable this share acquisition

Other holdings

80%

20%

18.7%

81.3%

IPBC

NIDC

Poliamba Limited

Poliamba Higaturu Milne Bay

Kula Palm Oil Ltd(“KPOL”)

Poliamba Higaturu Milne Bay

Poliamba Limited

Kula Palm Oil Ltd(“KPOL”)

Other holdings100%

100%

c.0.4%c.2%

IPBC NIDC

NBPOL Current Position Proposed Reorganisation

Other Shareholders

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Kumbango mill carbon reduction methane capture project

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Carbon Footprint Report

• For NBPOL to remain at the forefront of sustainability best practice in the industry, it has chosen to publish the first detailed life cycle carbon emissions for palm oil

• NBPOL was a leader in the industry with the RSPO, it sees carbon reporting as critical going forward and has again positioned itself as a leader

• Highly detailed study based on data collected over 20 years

• Scope - West New Britain operations (55,976 ha, c.8,000 smallholders)

• All operations (further sites) completed by 2013

• Report took over 12 months to complete

• Life Cycle Assessment approach – 95% capture - “cradle to refinery gate”

• Extension of the work first reported in NBPOL 2009 sustainability report and represents a measurable, time bound commitment to CO2 reduction.

• Working toward ‘no net loss’ Carbon balance on future expansions

• Full report available at www.npol.com.pg

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Social awareness, support, and interaction is vital in PNG, especially as NBPOL provides housing, healthcare, recreational facilities, and education to a large proportion of its approximate 11,500 permanent employees.

NBPOL takes its responsibilities to its employees extremely seriously and recognises its obligations to the workforce which rely heavily on the company

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Sustainability

• All long standing NBPOL estates and supply chain certified as sustainable and traceable

• Firm commitment to have all new units and supply chains certified as fully sustainable and traceable by the end of 2012

• NBPOL was instrumental in developing the Roundtable on Sustainable Palm Oil (www.RSPO.org)

• NBPOL has control over its harvesting, milling, transportation, shipping and refining, it can trace individual shipments back to source

• With the UK refinery it has a unique fully sustainable and traceable supply chain to the EU

• In September 2011, the World Economic Forum (WEF) identified NBPOL as one of 16 out of a study of 1000 companies that are best showing how to grow profits at the same time as actively tackling environmental and social challenges

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NBPOL newly planted estates

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• 2011: record year financially and operationally

• Growth inherent in the group, from plantation expansions at Ramu, and margin growth to come from KPOL

• Palm oil fundamentals remain strong

• Very stable, low geared capital structure

• Focus of the business on planting and integration of KPOL

Conclusions

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• The information contained in this document is for information only. No representations or warranties, express or implied, are given by the Company or any person connected with the Company as to the fairness, accuracy or completeness of the information or opinions contained in this document, any presentation made in conjunction herewith or the accompanying materials and no liability is accepted in respect thereof, to the extent permitted by law.

• To the fullest extent permitted by law, none of the Company, Akur Partners LLP or any other party or any of their respective subsidiary undertakings or affiliates or any of such person’s officers or employees, advisors or other representatives, accepts any liability whatsoever (whether in negligence or otherwise) arising directly or indirectly from the use of this document.

• This document is being furnished to you on a confidential basis and may not be disclosed, reproduced or redistributed, in whole or in part, by any medium or in any form to any other person for any purpose without the Company’s prior written consent. You shall treat and safeguard as strictly private and confidential all information contained in this document and take all reasonable steps to preserve such confidentiality. You shall not use this document or the information contained therein in any manner detrimental to the Company.

• This document has been prepared for information purposes only and should not be relied upon, or form the basis for any decision or action, by any person.

• This document contains forward-looking statements that involve substantial risks and uncertainties and actual results and development may differ materially from those expressed or implied by these statements by a variety of factors.

• By accepting this document and attending the presentation you agree to be bound by the foregoing limitations.

February 2012

Disclaimer

www.nbpol.com.pg

Phone: +44 (0)20 7472 5936


New Britain Palm Oil Ltd

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