Annual results of the SIPEF group per 31 December 2018

February 14, 2019

·  The expected growth of the palm oil productions in the fourth quarter was not achieved due to high rainfall in Sumatra.

·  The annual production of palm oil rose by 6.3% and exceeded the 350 000-tonne mark for the first time.

·  Due to high inventories of vegetable oils, the palm oil price in the second half of the year was also falling to a low of USD 460 per tonne CIF Rotterdam, a level that was not seen in the past 9 years.

·  The net result, share of the Group, before the capital gain on the sale of the insurance business, amounted to KUSD 22 713, a decrease of 64.8% compared to 2017 net result of KUSD 64 481.

·  The net IFRS result, share of the Group, amounted to KUSD 30 089, compared with KUSD 139 663 per end 2017, after non-recurring capital gains.

·  The expansion of the activities in South Sumatra was continued steadily, so that the planted hectares increased by 2 326 hectares by the end of 2018 to 80 539 (equal to 74 039 hectares share of the Group). The total capital expenditure for the Group was KUSD 69 428, whereas the net financial debt increased to KUSD 121 443.

·  In a recovering palm oil market, 23% of the expected 2019 palm oil production was already sold at an average price of USD 584 per ton CIF Rotterdam, premiums included, and based on the supply/demand positions of the vegetable oil market, higher prices could be expected in the next quarters.

·  In line with the 30% pay-out ratio of previous years, the board of directors proposes to approve a gross dividend of EUR 0.55 per share, payable on July 3, 2019.

·  As a fully RSPO compliant producer, SIPEF continues to deliver certified segregated sustainable palm oil to the European and Asian markets.

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