TORONTO, July 4, 2012 /CNW/ - Feronia Inc. ("Feronia" or the "Company") (TSX-V: FRN) today announced that it has filed on SEDAR amended and
restated interim financial statements and management's discussion and
analysis for the first three quarters of 2011 (the "2011 Refilings"). As previously announced, as a result of the audit of the financial
statements for the year ended December 31, 2011, the Company determined
that certain IFRS-determined information in its interim filings for
each of the first three quarters of 2011 would require adjustments to
correct for IFRS-related changes in the valuation model for the
biological assets of the Company and the reclassification of the
warrants as financial liabilities. A summary of the adjustments made in
the 2011 Refilings is set forth below:
(1) Non-current biological asset valuation
As a result of the adoption of IFRS in 2011, management was required to
apply the accounting standard IAS 41, Biological Assets (IAS 41) for
each interim period from the transition date, being January 1, 2010.
Accordingly, the 2011 Refilings include adjustments to reflect the
proper application of IAS 41 and to correct for formula errors noted in
the valuation models and errors in the valuation methodology, resulting
in an elimination of gain on the biological assets of the Company, an
elimination of non-current biological assets and a corresponding
reduction in income tax expense and deferred tax liabilities.
(2) Warrant liability
As a result of the adoption of IFRS, the Company was required to record
certain non-broker warrants as financial liabilities based on the fact
that the warrants have anti-dilution clauses which did not meet the
"fixed-for-fixed" rule set out in IAS 32. Accordingly, the 2011
Refilings include adjustments to reflect the proper application of IAS
32, resulting in the recognition of a fair value gain or loss, as the
case may be, in the warrants as part of finance costs.
(3) Arable and other adjustments
In preparing the 2011 year-end consolidated financial statements,
management noted that certain transactions were not accounted for
correctly during the interim periods, which resulted in adjustments
being made to certain line items in the interim financial statements
for the first three quarters of 2011. The adjustments in the 2011
Refilings primarily relate to an increase in selling, general and
administrative expenses as a result of expensing previously deferred
costs relating to arable land preparation and adjusting amortization
expense.
Please refer to Note 2 of the amended and restated consolidated interim
financial statements for the first three quarters of 2011 for a
detailed breakdown of the adjustments associated with the foregoing
items, available at www.sedar.com.
Executive Chairman Ravi Sood commented: "As indicated in previous
filings the Company had identified various items, relating primarily to
our transition to IFRS accounting, that required restating. All of
these restatements were non-cash items and not related to the
fundamental performance and progress in our business. Since December
2011, we have strengthened our finance team with the addition of two
experienced professionals. We believe that the Company is well
positioned to handle the accounting and finance requirements of the
growth ahead of us."
About Feronia Inc.
Feronia is a large-scale commercial farmland and plantation operator in
the Democratic Republic of Congo ("DRC"). The Company uses modern
agricultural practices to operate and develop its oil palm plantations
and arable farming business division. Feronia believes in the immense
agricultural potential of the DRC for high-quality foodstuffs and
edible oils given its ideal climate, excellent soil and highly skilled
and experienced workforce. Feronia's management team is comprised of
senior agriculturalists with extensive experience in managing both
plantations and large-scale mechanized farming operations in emerging
markets. Feronia is committed to sustainable agriculture,
environmental protection and providing support for local communities.
For more information please see www.feronia.com.
Cautionary Notes
Except for statements of historical fact contained herein, the
information in this press release constitutes "forward-looking
information" within the meaning of Canadian securities law. Such
forward-looking information may be identified by words such as
"anticipates", "plans", "proposes", "estimates", "intends", "expects",
"believes", "may", "will" and include without limitation, statements
regarding proposed capital expenditure; the Company's plan of
operations and comparative advantages; plans regarding sowing rice and
replanting oil palms; improvements in harvesting and collection; and
positive trends regarding OERs. There can be no assurance that such
statements will prove to be accurate; actual results and future events
could differ materially from such statements. Factors that could cause
actual results to differ materially include, among others: risks
related to foreign operations (including various political, economic
and other risks and uncertainties), the interpretation and
implementation of the "Loi Portant Principes Fondamentaux Relatifs A
L'Agriculture" (the DRC's agriculture law, as discussed in the
Company's management's discussion and analysis for the period ended
March 31, 2012), termination or non-renewal of concession rights or
expropriation of property rights, political instability and
bureaucracy, limited operating history, lack of profitability, lack of
infrastructure in the DRC, high inflation rates, limited availability
of debt financing in the DRC, fluctuations in currency exchange rates,
competition from other businesses, reliance on various factors
(including local labour, importation of machinery and other key items
and business relationships), the Company's reliance on two refining
factories and one major customer, lower productivity at the Company's
plantations and arable farming operations, risks related to the
agricultural industry (including adverse weather conditions, shifting
weather patterns, and crop failure due to infestations), a shift in
commodity trends and demands, vulnerability to fluctuations in the
world market, the lack of availability of qualified management
personnel and stock market volatility. Most of these factors are
outside the control of the Company. Investors are cautioned not to put
undue reliance on forward-looking information. Except as otherwise
required by applicable securities statutes or regulation, the Company
expressly disclaims any intent or obligation to update publicly
forward-looking information, whether as a result of new information,
future events or otherwise.
Neither the TSX Venture Exchange nor its regulation services provider
(as that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.