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The results for 2019 reflect a profit before tax from continuing operations of £22.3 million and include significant provision releases and one off items amounting to £6.2 million (2018: profit before tax from continuing operations £52.5 million, including provision releases of £14.4 million).

In previous years we have talked extensively about the need to diversify our portfolio of businesses, particularly in Agriculture, and to ensure that we are as efficient in our production methods as we can be. The need for this diversification has never been more evident than in 2019, which saw the year open with an over-supply of tea in the market causing prices to fall and from which they never recovered.

Our own tea production fell slightly short of last year’s record but at 101.4mkg was our second highest year, reflecting the investment that we have made in replanting and irrigation and the purchase of two additional estates in Assam. Our other core crops also performed well, and with good prices in the market, both macadamia and avocado made a significant contribution to Group profit.

More generally, we saw an increasing number of extreme weather events across our operations, with hurricanes, droughts, floods and excessive temperatures seemingly more frequent and more widespread than they have ever been. In 2019 we published our first ever comprehensive ESG report to demonstrate what we are doing to reduce our own environmental footprint, and to mitigate the impacts of climate change. Whilst we are pleased with our progress in many areas, we are also conscious that we need to do more and therefore we have also introduced an internal fund, to use some of our centrally held resources to enable a step change in our sustainability programmes around the world.

The Group is set up in a way that reflects our long-term approach, with financial stability and sustainability being at the heart of our philosophy. The current situation with regard to COVID-19 is unprecedented not only in its severity but because we cannot tell at this stage for how long it will last nor what the implications will be. Your Board has therefore decided not to recommend any additional dividends until we get clarity on the situation. Once we have this clarity and if circumstances so justify, we will declare a special dividend alongside the interim dividend.

Never in my years as Chairman has it been so hard to predict the outcome of the coming year. Whilst only a small proportion of our operations are direct to the consumer, the ramifications of the COVID-19 outbreak and the economic fallout arising from it are affecting all our businesses to some extent, and the ultimate impact will not be clear for some months yet. This matter is discussed in more detail in the Chief Executive’s report. It is of course a situation that changes day by day.

However we remain financially strong, with significant net cash, and have the resources to withstand a period of disruption. The demand for our agricultural produce will remain and we are managing the business in a pragmatic manner which we believe will ensure our future prosperity whilst taking the necessary steps to manage our costs and spending in the short term.

I am delighted to welcome two new Non-Executive Directors onto the Board. Simon Turner, who is president of The Camellia Foundation, our majority shareholder, and Jonathon Bond who holds a number of directorships and has a particular focus on raising standards of governance and performance.

As always, my thanks go out to all our staff for their efforts in 2019 but in addition I should like to thank them for their continuing support during this very difficult period.

Malcolm Perkins

7 May 2020

2020 ESG Report

Our 2020 ESG Report is now available.