Benso Oil Palm Plantation (BOPP) PLC, a leading oil palm plantation agric-business in Ghana and Africa, has made an impressive performance despite the coronavirus pandemic.
The company delivered profit after tax of GH¢92.41million compared with GH¢20.69million the previous year, showing a significant improvement of 274 percent of last year’s profit.
The level of profitability was impacted by the 63 percent growth in the trading prices of crude palm oil, 70 percent growth in crude palm kernel oil prices, and 9 percent growth in crop production from the Nucleus, Smallholder and Out-grower.
Also, there was an improvement in operating efficiencies to contain the growing cost of business amid the COVID-19 pandemic.
The Production Volume Total of palm fruits processed during the year under review was 146,326 metric tonnes, representing a 9 percent increase over the 2020 production.
The increase in the volumes was mainly from the nucleus and the outgrower. However, there was a slight reduction in crop from the smallholder plantings as 500ha of the total area of 1,650ha was undergoing replanting.
“Effectively, your company purchased 61,753 metric tonnes of fresh fruit bunches at a total cost of GH¢37million from smallholders and outgrower farmers in the catchment areas, particularly in the Western and Central Regions of Ghana,” Dr. Ishmael Yamson, Chairman and Non-Executive Director of BOPP made these remarks at the Annual General Meeting of company in Takoradi.
According to him, the company recorded a growth in turnover of 73 percent for the financial year 2021 on account of the relatively stable crop production volumes, good prices and the effect of depreciation of the Ghana cedi against the United States dollar.
On the Operating Profit in 2021, he mentioned that BOPP witnessed a rise in operating profit by 258 percent on account of growth in crop production of 9%, and the significant growth in the world market prices for crude palm oil.
“The improved operating efficiencies and the general rise of 63 percent and 70 percent of trading Crude Palm Oil (CPO) and Crude Palm Kernel Oil (CPKO) prices, respectively, compared to the prior period resulted also in the improved operating profit,” he said.
Dr. Yamson pointed out that turnover expanded approximately by 73% from GH¢123.82m in previous period to GH¢214.18m.
He explained that the combined effect of economies of scales in production and the cumulative Ghana cedi depreciation of 4% had a constructive impact on revenue and on the cost of sales.
“In compliance with International Financial Reporting (IFRS), gains arising from changes in the fair value of biological assets contributed GH¢2,684,000 to the operating profit delivered in this year under review. Dividend in 2021, your company paid a total dividend of GH¢7.41m (Basic and Diluted End Price Share (EPS) of GH¢0.7097) out of a total profit of GH¢24.69m for the year ended 31st December 2020.”
On Corporate Social Responsibility, he added that BOPP continues to support brilliant but needy students within the communities through educational scholarships.
He continued that from 2018 to 2021 academic years, 17 students from the four communities in which the company operates have benefitted from the company’s Tertiary Education Scholarships.
“During the year under review, BOPP company paid out GH¢38.9million to smallholder and outgrower farmers for the purchase of fruits in the catchment area, thus, contributing to the socio-economic enhancement of the livelihood of these farmers,” he said.
Dr. Yamson stated that: “About GH¢1,065,477.69 was spent on Corporate Social Responsibility projects, notable among them were construction of 4-bed capacity male ward for Benso community clinic, 20-Seater WC toilet facility for Adum Banso community, rehabilitation of 5-unit classroom block for Adum Banso Roman School, road maintenance and rehabilitation in Dominase, Amantin, Trebuom, Ayiem Benso and Adum Banso communities, donation of clinical laboratory equipment to Adum Banso community clinic, donation toward National and Regional Farmers’ Day Celebration”.
“Without doubt BOPP has become the model of Best Management Practice (BMP) in the oil palm plantation industry in Africa. In the recent FT ranking of the 75 fastest growing companies in Africa, BOPP Plc was one of the four companies that made it into the list from Ghana,” he pointed out.
Samuel Avaala Awonnea, General Manager and Executive Director of BOPP PLC, explained that: “Ghana has passed the law that has established the Tree Crops Development Authourity – an authority which is mandated to see to the regulation and development of the tree crop sector for some specific six tree crops, of which oil palm in one”.
“With this regulatory environment set, we are more than poised to take advantage of that environment; the policy environment that this has created is to embark on an expansion, and it is our strategy to expand our current production by twofold within the next five years and to do that we need a lot of the mandate of the tree crop development authority to come into fruition to become practical,” he added.
He stated that: “We also need our chiefs and traditional rulers and authorities, as well as district assemblies to be aligned so that we can co-create the business environment, the plantation agriculture and manufacturing that reduces poverty among the rural communities, increases wealth, and in the end bring economic benefits because we will then be able to bridge the gap between demand and supply, which at the moment is in the negative and for which reason Ghana is a net importer of palm oil”.
He concluded that BOPP is the first company to be Roundtable on Sustainable Palm Oil ‘RSPO’ certified in Ghana, and the second in Africa.
