Narborough Plantations : INTERIM FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE 2014

THE NARBOROUGH PLANTATIONS, PUBLIC LIMITED COMPANY

(Incorpora!ed in England 1910- Registration No. 109273)

(Registered as a Foreign Company in Malaysia- No. 991416-W)

INTERIM FINANCIAL STATEMENTS FOR THE PERIOD ENDED 30 JUNE 2014

THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

Contents

Page
Responsibility statement 1
Interim management report 2 - 7
Condensed income statement 8 - 9
Condensed statement of comprehensive income and expenses 10 - 11
Condensed statement of changes in equity 12 - 15
Condensed statement of financial position 16 - 17
Condensed cash flow statement 18 - 19
Notes to financial statement 20 - 28

THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

RESPONSIBILITY STATEMENT

We confirm to the best of our knowledge:
(a) The condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial
Reporting';
(b) The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
(c) The interim management report includes a fair review of the information as required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).
By order of the Board,
Chairman of the Audit Committee
Mohd Razali Bin Mohd Amin
7 August 2014
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM MANAGEMENT REPORT

To the members of The Narborough Plantations, plc ("the Company")

Cautionary Statement

This Interim Management Report (IMR) has been prepared solely to provide additional information to shareholders to assess the Company's strategies and the potential for those strategies to succeed. The IMR should not be relied on by any other party or for any other purpose.

The IMR contains certain forward-looking statements. These statements are made by the directors in good faith based on the information available to them up to the time of their approval of this report but such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.

This interim management report has been prepared for the Company as a whole and therefore gives greater emphasis to those matters which are significant to the Company and its associate undertakings when viewed as a whole.
The Company's Business Model and Strategy
The Company was incorporated in the United Kingdom on 27 April 1910 and listed on the London Stock Exchange under FTSE Fledgling (ex IT) index on 21 April 1948. It is also registered as a foreign company in Malaysia under the Companies Act, 1965 in Malaysia.
The principal activity of the Company in the course of the six months ended 30 June 2014 remained unchanged and consists of cultivation of oil palm at an area known as Sungkai in the state Perak, Malaysia. The oil palm is a perennial crop which starts yielding palm fruits for oil about three years after planting and it has a continual productive lifespan of 25 - 30 years
Income
The Company's income is mainly derived from the sale of oil palm Fresh Fruit Bunches ("FFB") and other income such as interest received from fixed deposits and supplemented by replanting subsidies from the Government of Malaysia as and when granted.
Sustainable growth and strong cash generation
The Company's oil palm estate spans approximately 564 hectares with a planted area of 555 hectares which was formerly planted with rubber trees. The oil palm trees are scheduled to be replanted approximately every
25 - 30 years to maintain quality FFB yield for sustainable revenue growth. The Company's strategy is to achieve higher profitability through disciplined allocation of resources towards achieving higher quality FFB yields with high oil extraction rates which increases the price that can be achieved from FFB leading to strong cash generation.
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM MANAGEMENT REPORT - continued

Key Performance Indicators

As set out in our most recent annual report, the Company's performance is measured with the following fundamental key performance indicators (KPIs). Performance for the six months ended 30 June 2014 together with the prior year performance data are set out in the table below. The source of data and calculation methods used are consistent with those disclosed in the 2013 annual report.

Six months ended 30 June 2014 2013 Variance (%)
Financial KPIs
Earnings per share (pence) 1.68 0.07 2300% PE Ratio 0.02 0.00 2210% Net Asset Value per share (incl. Intangibles) (pence) 133.43 152.97 -13% Operating Margin 34.10% -2.73% - Return on Capital Employed 1.26% 0.05% 2572%
Non-financial KPIs
Yield (Metric Tonne ["MT"]) 5,122.26 4,241.20 21% Yield per hectare (MT / hect) 12.37 9.82 26%

* Emission intensity ratio is not available for the 6 months ended 30 June 2014 as measurement is only conducted once per annum.
The results in the table above show that we met our targets for 6 of our 7 KPIs due to the increase in productivity and price of Fresh Fruit Bunches ("FFB"). The increase in production is due to good weather with ample rain encountered in the last half of 2013.
Given the dry weather expected in coming weeks and months brought by the El Nino weather system, production of FFB will decrease.
Due to the above, the directors have taken measures to counter the drop in production expected in the months ahead by improving FFB harvesting and collection methods to ensure stability in the Company's revenue.
Whilst other performance measures may be discussed in the IMR, the above KPIs are the Company's main performance measure.
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM MANAGEMENT REPORT - continued

Results for the six months ended 30 June 2014

Six month ended 30 June

2014 RM

Revenue
The Company's revenue increased from RM2,032,281 (£428,751) for the six months ended 30 June 2013 to RM2,976,864 (£546,214) for the current period. This is due to the increase in average six months FFB prices from RM479.18 per MT for the six months ended 30 June 2013 to RM581.16 per MT for the current period in relation to higher CPO prices for the current six months period ended 30 June 2014. FFB production has also increased by 21% as compared to the previous six months period ended 30 June 2013.
This is in line with the anticipated results as reported in our last annual report.
Gross operating margin and operating profit
Given the increase in FFB price and production, gross operating margin has increased to 34.10% for the six months ended 30 June 2014. This is indicated in the current period operating profit of RM1,015,087 as compared to the operating loss reported to you for the six months ended 30 June 2013 of RM55,414.
Dividend paid
A Single Tier Interim Dividend of 15% amounting to RM1,081,062 (£199,749) for the year ending 31 December
2014 was announced on 15 May 2014 and paid on 10 June 2014.
4

THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM MANAGEMENT REPORT - continued

Financial position
The Company has continued to maintain a strong financial position as at 30 June 2014, with net assets of RM97,213,376 (£17,768,460) as compared with the net assets as at 31 December 2013 of RM99,510,481 (£18,390,337). Cash and short term deposits totalled RM11,865,475 (£2,169,191) as compared with RM12,838,794 (£2,373,159)of the previous financial year ended 31 December 2013. The company has no bank borrowings.
Cash flow
Net cash flow from operating activities for the six months ended 30 June 2014 was RM496,347 (£93,098) as compared to the net cash outflow of RM765,705 (£160,258) for the comparative period in 2013. This is due the increase in revenue as compared to the six months ended 30 June 2013.
Retirement benefits
Retirement benefits for the Company's employees remains as that stated under Note 1.10 on Page 65 of our
Annual Report 2013.
Events after the balance sheet date
There were no significant events after the balance sheet date that would affect the financial position of the company.
The Board of Directors of the Company has retired at the Annual General Meeting ("AGM") held on 20 June
2014 and replacement members as shown in the table below :

Position	Retired at AGM	Re-Elected ("RE") / New ("N")
Chairman	Roslan bin Hamir	Roslan bin Hamir (RE)
Executive Director	Adrian Tsen Keng Yam	N/A
Audit Committee Chairman	Lim Hu Fang	Mohd Razali bin Mohd Amin (RE)
Non-Executive Director	Juliana Manohari Devadason	Timothy Huntsman (N)
Non-Executive Director	Stephen William Huntsman	Oliver John Harold Huntsman (RE)
Non-Executive Director	N/A	Leong Tat Thim (N)

Related party transaction
There were no significant related party transactions of the Company for the six months period ended 30 June
2014.
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM MANAGEMENT REPORT - continued

Risk and uncertainties
There are a number of potential risks and uncertainties which could have a material impact on the Company's performance over the remaining six months of the financial year and could cause the actual results to differ materially from expected and historical results. The directors do not consider that the principal risks and uncertainties have changed since the publication of the annual report for the year ended 31 December 2013. A detailed explanation of the risks summarised below, and how the Company seeks to mitigate the risks, can be found on pages 91 to 95 of the annual report which is available at www.narboroughplantations.com
Principal risks and uncertainties
• Unexpected variations in crop, principally caused by unusual weather and pest infestation.
• Variations in commodity prices.
• Input cost inflation.
Interest rate risk
The Company's income and operating cash flows are substantially independent of changes in market interest rates. As the Company does not have any borrowings, interest rate exposure arises solely from short term deposits with financial institutions.
Credit risk
The Company has only one customer and is on short credit terms.
Short term deposits and cash and bank balances are placed with major financial institutions in Malaysia, Singapore and United Kingdom.
Liquidity risk
Liquidity risk arises from the Company's management of working capital. It is the risk that the Company will encounter difficulty in meeting its financial obligations as they fall due.
Currency risk
The Company is exposed to currency risk as a result of the foreign currency transactions entered into in currencies other than Ringgit Malaysia.
Going concern
As stated in Note 2 of the condensed financial statement, the directors are satisfied that the Company has sufficient resources to continue in operation for the foreseeable future, a period of not less than 12 months from the date of this report. Accordingly, they continue to adopt the going concern basis in preparing the condensed financial statements.
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM MANAGEMENT REPORT - continued

Future outlook
The price of CPO futures continues to look promising due to the anticipated reduction in FFB output brought on by the dry weather caused by the El Nino weather system in the remaining six months. However, high CPO prices has also seen major importers of CPO such as China and India switch to soya bean oil and rapeseed oil but with reduction in CPO inventories, the price of CPO should stabilise around the current value as both countries has a combined average consumption of 70% of the world palm oil.
Barring any unforeseen circumstances, the directors expect the performance of the Company for the current financial year 2014, to be satisfactory.
Auditing of the condensed set of financial statements
In accordance with the Disclosure and Transparency Rules ("DTR") no. 4.2.9(2) of the Financial Conduct
Authority ("FCA"), the Board of Directors hereby confirm that this six months financial report ended 30 June
2014 has not been audited or reviewed by auditors pursuant to the Auditing Practices Board guidance on
Review of Interim Financial Information.
Malaysian Registered Office:
33 (1st Floor) Jalan Dato' Maharajalela
30000 Ipoh
Tel No. : 605-255 9015
Fax No. : 605- 255 9016
By order of the Board
Chairman of the Audit Committee
Mohd Razali Bin Mohd Amin
7 August 2014
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)

INTERIM FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 MARCH 2014

CONDENSED INCOME STATEMENT (the figures have not been audited) (in Ringgit Malaysia)
Continuing Operations	6 months ended		Year ended
	30.06.14 30.06.13		31.12.13
Revenue	RM RM 2,976,864 2,032,281		RM 5,014,013
Cost of sales	(1,100,971) (1,117,203)		(2,356,349)
Gross Profit	1,875,893 915,078		2,657,664
Gain arising on revaluation of biological assets	- -		649,544
Other operating income	33,642 24,355		89,300
Administrative expenses	(603,374) (506,832)		(1,091,037)
Exchange profit/(loss)	30,557 (52,946)		258,573
Replanting expenditure	(321,631) (435,069)		(813,172)
Operating Profit	1,015,087 (55,414)		1,750,872

Share of distributable profit of associate after tax pre fair value of the biological asset and investment properties

adjustment 380,756 42,588 741,822

Fair value of the investment properties adjustment - - 605,473

Deferred tax recognised on investment properties - - (181,643)

Fair value of the biological asset adjustment - - 11,079

Deferred tax recognised on the biological asset - - (2,770)

Share of operating profit in associate after tax 380,756 42,588 1,173,961

Property, plant & equipment written off - - (630) Finance income 136,072 156,636 302,129

Finance cost (10,320) (9,151) (19,554)

Profit on ordinary activities before taxation 1,521,595 134,659 3,206,778

Taxation (315,162) (89,789) (489,155)

Profit for the period attributable to owners of the company 1,206,433 44,870 2,717,623

Earnings per share (sen) 9.06 0.34 20.41

The income statement should be read in conjunction with the financial statements for the financial year ended 31 December 2013 and the accompanying explanatory notes attached to the interim financial statements.
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THE NARBOROUGH PLANTATIONS, PLC

(Incorporated in England 1910 - Registration No. 109273)
(Registered as a Foreign Company in Malaysia - No. 991416-W)
CONDENSED INCOME STATEMENT (the figures have not been audited) (in Pound Sterling)

Continuing Operations 6 months ended Year ended

	30.06.14 £		30.06.13 £		31.12.13 £
Revenue	546,214		428,751		1,017,041
Cost of sales	(202,013)		(235,697)		(477,961)
Gross Profit	344,201		193,054		539,080
Gain arising on revaluation of biological assets	-		-		120,063
Other operating income	6,173		5,138		18,113
Administrative expenses	(110,711)		(106,927)		(221,306)
Exchange profit/(loss)	5,607		(11,170)		52,449
Replanting expenditure	(59,015)		(91,787)		(164,944)
Operating Profit	186,255		(11,692)		343,455

Share of distributable profit of associate after tax pre fair value of the biological asset and investment properties

adjustment 69,863 8,985 150,471

Fair value of the investment properties adjustment - - 122,814

Deferred tax recognised on investment properties - - (36,844)

Fair value of the biological asset adjustment - - 2,048

Deferred tax recognised on the biological asset - - (512)

Share of operating profit in associate after tax 69,863 8,985 237,977

Property, plant & equipment written off - - (128) Finance income 24,967 33,046 61,284

Finance cost - (1,887) (3,805)

Profit on ordinary activities before taxation 281,085 28,452 638,783

Taxation (57,828) (18,943) (99,220)

Profit for the period attributable to owners of the company 223,257 9,509 539,563

Earnings per share (pence) 1.68 p 0.07 p 4.05 p

The income statement should be read in conjunction with the financial statements for the financial year ended 31 December 2013 and the accompanying explanatory notes attached to the interim financial statements.
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