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Agriterra Ltd is an AIM listed agricultural company with five divisions: beef, maize, cocoa, fruit and palm oil.  Its cattle ranching business, Mozbife, has a herd in excess of 6,200 head, a land holding of over 21,000 hectares, a feedlot, a 4,000 head per month capacity abattoir and retail units.  In addition to selling meat from its own herds, throughput for the feedlot and abattoir is supplemented with cattle bought in from local communities.  The Company also owns a proximal banana plantation and macadamia orchard.

The Company's maize buying and milling operations, DECA and Compagri, are located in Chimoio and Tete in central and north-western Mozambique respectively.  These collect maize from circa 350,000 farmers using the Company's own vehicle fleet, process it into maize meal, the African staple, and then sell it back to the local market, into supermarkets and to the World Food Programme.

Agriterra's cocoa business is based in Sierra Leone, through its 100% subsidiary Tropical Farms Limited, which includes buying, trading and production operations.  The Company holds over 1,200 hectares of land for cocoa cultivation and also has a strong buying register with three main hub stores, 41 satellite stores and a direct buying register of more than 3,500 farmers across the country.  Its strategy is to establish itself as a secure, sustainable and traceable source of supply to meet the requirements of the major cocoa consumers who are placing increased emphasis in this area. 

Mozbife Limitada

Mozbife is a vertically integrated cattle ranching and feedlot production business which is developing into a "field to fork" producer, to capture more of the added value available higher up the food chain, benefitting profitability.

The board believes that beef ranching offers a material value opportunity in Africa and its beef business remains an area of significant expansion and investment for the Group. The Company's objective is to build a total herd in excess of 10,000 head by 2015.

Mozbife was established to supply premium beef to both the domestic market in Mozambique as well as for export. Beef consumption in Mozambique has been steadily rising and is forecast to continue to grow in the future as living standards across the country improve. The Company is in the process of building a sizeable herd of pedigree Beefmaster cattle, which has been developed for its high quality meat, top weight gaining ability and suitability to hot climates such as Mozambique.

In line with Agriterra's vertically integrated "field to fork" strategy, has developed the Vanduzi feedlot project. The feedlot is currently housing animals ahead of slaughter at the Chimoio abattoir, with dress out weight percentages between 53% and 55% and an average sale price per animal in excess of US$1,050. The attractive sale price for the animals highlights the possible financial returns for an established beef ranching operation in Mozambique and underpins the huge potential of Mozbife.

Agriterra constructed an abattoir in Chimoio, which commenced operations in December 2012, to ensure the Company benefits from the full value uplift of the butchered product. The abattoir is targeting a 4,000 head per month processing rate in addition to a goat processing line, and throughput for both the feedlot and abattoir is augmented by bought-in local animals which further contribute to revenues.

Tropical Farms Ltd

Tropical Farms Limited ('TFL') is a cocoa and coffee company based in Sierra Leone.

TFL has built a strong platform from which to expand into cocoa production by making use of TFL's regional expertise and established buying operations in West Africa.

The Company intends to focus on securing cocoa supplies for the business through a combination of forging long term relationships with farmers and out-grower schemes, implementing farm management initiatives and in time, through the development of the Company's own cocoa plantations.

With three main hub stores and 41 satellite stores and a direct buying register of more than 3,500 farmers across the country, the Board of Agriterra believes that TFL's established base of 'out-growers' provide a solid base from which it can be rapidly expanded under the Agriterra umbrella. It is the Company's intention to develop additional community buying centres across the district. TFL will also be providing further solar drying and fermentation facilities, in order to increase total buying capacity as well as guarantee supplies of cocoa. In addition, TFL's buying model enables the origins of supplies to be traced without the need for local agents.

As part of its expansion plans, both in terms of critical mass and commodity, TFL is in negotiations to secure a 15-acre site in Sierra Leone's New Airport Development Zone in Freetown in order to build a state-of-the-art collateral management facility. This will be TFL's main hib servicing both Freetown and the international markets for all commodities that TFL is involved. In addition, it will have sufficient capacity to handle produce from the planned plantations TFL intends to invest. TFL has also been granted a 50 year lease over a five acre site in Kenema, where it intends to construct a processing and management facility to dry and process cocoa beans ready for export. It will also house administrative and buying offices as well as vehicle maintenance facilities.

Deca Limitada

DECA, based in Chimoio in the Manica Province of Mozambique, was founded in 2005 to treat and process maize.

The Company purchases maize directly from thousands of local smallholder farmers through a specialised, proprietary, buying system, whereby Agriterra provides and installs the necessary infrastructure at specific buying points across the Chimoio region.

Local farmers bring their produce to these designated points and are paid cash directly by DECA, thereby supporting economic activity in the relevant rural areas.

Once the grain is purchased it is transported back to DECA's purpose-built storage and processing facility in Chimoio where it is dried, fumigated, prepared and processed into maize meal, a key staple food in the region and country as a whole. Maize meal, also known as mealie meal, is used extensively in African and Asian cuisines to make various pancakes, flatbreads and porridges and bran/harmony chop products, (effectively the waste product of the processing process) used throughout the region as livestock feed. After processing, the meal is packaged and transported to appropriate venues for onward sale under the DECA brand.

DECA is cash generative, has a strong brand, a loyal customer base and currently provides a market outlet for some 350,000 farmers. DECA's operations, involving the enfranchising of locals rather than major land acquisitions, have received strong support from local and national governments since inception, with the President of Mozambique, Armando Guebuza, opening the facility in 2005. The grain processed by DECA sustains thousands of people in the local province and approximately 15% of DECA's products are sold to the UN World Food Programme.

Compagri Limitada

Compagri was established in May 2009 in Tete, 400km to the north of Chimoio, as a second agricultural buying and processing facility in Mozambique.

As at Chimoio, operations at Tete are focussed on the purchase of maize from indigenous out-growers, which is then processed into corn flour/maize meal, a key African food staple. The current total storage capacity for maize at the facility is 15,000 tonnes.

Tete is rich in natural resources and is currently enjoying a boom in mining activity – over the last decade the majority of the 140 or so exploration licences granted in Mozambique are located in Tete where a number of huge coal discoveries have been made. After years of neglect, the region's limited infrastructure needs updating and improving in order to transport coal and other resources to market. As a result, Tete is experiencing significant inflows of investment and personnel making Compagri well placed to benefit from the increased activity in the region.

DECA's transport division has seen rapid growth of its fleet and facilities and is now running over 80 vehicles, with all maintenance and repair work carried out in-house by a team of locally based mechanics. Although the collection operation is seasonal, it collects enough produce and has the storage space to mill throughout the year, thus stabilising its revenue stream.

In December 2011, Agriterra expanded its portfolio of agricultural products through the addition of palm oil, through the acquisition of Shawford Investments Inc ('Shawford'), which in turn owns Red Bunch Ventures (SL) Limited ('Red Bunch').

Red Bunch Ventures

Red Bunch holds a 50 year lease (with an option to renew for a further 21 years) of approximately 45,000 hectares of brownfield agricultural land in an area suitable for palm oil production in the Pujehun District in the Southern Province of Sierra Leone. This area of Sierra Leone, which is close to the Liberian border, receives one the highest levels of rainfall in Sierra Leone, which in itself, receives some of the highest rainfall globally. In addition, the lease area is located on the equatorial belt, which is the most favourable geographical location for palm oil production.

As one of the most important and widely produced edible oils in the world, the addition of a palm oil operation marks an exciting period of growth for the Company, which broadens and complements Agriterra's current agricultural portfolio of cattle ranching, cocoa buying and trading and maize farming and milling operations.

Demand for palm oil is projected to continue to grow, driven by demand in Africa, India, China and the US, making it an important new target of for Agriterra's ambitious investment strategy.

Phil Edmonds, (MA Cantab), Chairman

Mr. Edmonds is a director of a number of public and private companies and has considerable experience of introducing African focussed companies to AIM, including BioEnergy Africa Limited, African Platinum Plc, Central African Mining & Exploration Company Plc, Central African Gold Plc and White Nile Limited. Mr. Edmonds is currently chairman of Sable Mining, Agriterra Ltd, African Medical Investments Ltd and AMS.  He holds an honours degree in land economy from Cambridge University.  He was born in Lusaka, Zambia, educated in Zambia and England and played cricket for England and Middlesex from 1974 to 1987.

Andrew Groves, Executive Director

Mr. Groves has significant experience in operations management in Southern and Central Africa and is a director of a number of private companies, including companies in Zambia and Zimbabwe.  Mr. Groves also has experience of introducing several African focussed companies to AIM together with Mr. Edmonds.  Mr. Groves’ current directorships include Sable Mining, Agriterra Ltd, Central African Tantalum Limited and African Medical Investments Ltd.  He was born in Harare, Zimbabwe and educated in Zimbabwe and South Africa.

Euan Kay, Executive Director

Mr. Kay has extensive experience in the sub-Saharan agricultural sector, managing the Company’s subsidiary Desenvolvimento E Comercialização Agricola Limitada (‘DECA’) since inception in 2005.  He is based in Mozambique full-time and oversees all operational activities at DECA, Compagri and Mozbife.

Michael Pelham, Non-executive Director

Mr. Pelham is a Zimbabwean national and has worked in various countries across Africa throughout his 18 year career.  Before joining White Nile as Operations Manager in 2006, Mr. Pelham held the position of Operations Liaison Manager at Ardan Safaris, and whilst in this role built strong significant relationships with local government officials and decision makers across southern, central and east Africa.  Mr. Pelham has a wealth of experience in project management, environmental consultancy, construction and risk management accumulated through his current directorship positions with Ardan Energy Services DMCC, Soszim Limited and Ardan Risk and Support Services (HK) Limited.

Shareholder Analysis

Financial summary: Index AIM ALL

Status: AIM

Stock Code: AGTA

Sector: Food Producers

Financial year end: 31 May

Total issued share capital: 1,214,716,238 Ordinary Shares and Deferred Shares (in aggregate)

Total voting capital: 1,059,716,238 Ordinary Shares

In accordance with the AIM Rules (Rule 26), in so far as the Company is aware, the percentage of the Company's issued share capital that is not in public hands is 62.44% There are no restrictions on the transfer of AIM securities

Key Shareholders as at 19/11/2012 which hold more than 3% in the Company:

Information taken from company website 03.05.2013