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7.0 Management Summary Managing Director: Mr. Adisa Kabiru Adeniyi - HND (Accountancy), ACA, AMNIM is a qualified accountant in Nigeria. He holds Higher National Diploma in Accounting from Osun State Polytechnic, Iree in Osun State, Nigeria. Kabiru has worked in various capacities in both pubic office and private organizations. These establishments are: Osun State Agricultural Development Corporation (OSSADEP); Karrington Group (Management Accountant); Stallion Homes, Loan and Savings Limited (Manager Account); Zoom Mobile Limited (Senior Accountant); He is the founders of Adeniyi Olubode Professional Services & Co (Chartered Accountants) and Guildance Community Development Foundation. These two companies are being managed successfully on a going concern basis. Adisa is well versed in tax laws, commercial laws, company law, accounting and auditing standards, management consultancy, information system audit, information system consulting, mergers and acquisitions and risk management. Operations/Marketing Manager: Adesina Adesoji Olukunle B.Agric OAU Ife & Diploma Certificate in Civil Engineering. He has over 18 years of experience in agricultural project management. Adesoji has successfully implemented over four oil palm plantation and processing in Nigeria. 8.0 Financial Plan Summary The total cost of the project is N25,000,000.00 (Twenty five million naira only). This is made up of N19,376,150.00 fixed cost and N5,623,850.00 operating expenses as detailed on Table 1. Equity contribution would be N1,000,000.00 while the balance is to be raised from financial institution at interest rate of 4% per annum. The fund would be disbursed in the first year to enable the project take off smoothly. Thereafter, the project would be financed from the proceeds of the farm. Loan repayment starts in the 2 nd year which means there is a grace period of 1 year. The loan will be fully repaid in 6 years. ASSUMPTIONS For the purpose of clarity, it is necessary to state all the assumption used in our analysis. These are listed below: a. The prices of items used in the analysis are the ruling prices goods and services in the market we have done our market survey before arriving of the prices hence the reliability of the data used. b. The useful lives of the fixed assets of the proposed project have been taking into consideration in the calculation at annual depreciation cost of 5% and 10% for each respective asset.. c. Investment Capital: The investment cost covers the cost of land acquisition, development, equipments, intercrops, the total investment cost of the project is estimated at N25,000,000.00 (Twenty five million naira only), Details are provided below:- Items N Land Clearing of (50 ha) 166,250 Oil palm seedling: 2,850,000 Wheel barrow 19,200 Machete 20,000 Chisel 7,500 Drum 28,000 Hydraulic press 720,000 Gallons 35,000 Land acquisition 7,500,000 Sieve 3,200 Sterilizer 180,000 Cracker 152,000 Maize seedling 250,000 Plantain & Banana seedling 450,000 Fertilizer 3,000,000 Digester 195,000 Storage 3,300,000 Personnel 2,700,000 Casual labour 2,700,000 Miscellaneous expenses 723,850 Sales Forecast The expected targets are contained in table II with the projected revenue, the selling price used in the study is as follows:- I. Palm oil N200 per litre II. Palm Kernel N4,000 per 50kg III. Maize N40,000 2per ton iv. Plantain N43,692.05 per metric ton IV. Sludge (fuel) N750 per bag of 25kg- Going by the table II under appendix, we expect to realize N11, 985,600; N11,985,600; N8,392,800; N22,404,200; N25,285,400; N28,166,600, N28,166,600 consecutively for 7 years. Any increase in the sale of these farm produce will automatically increase the profit and revenue. Economic Justification As depicted on (table ii & vii) of the appendix, the revenue from the sale of all the proposed crops is expected to be N19,483,828 on the average. While the average cost is estimated at N9,331,714. Net Present Value (NPV) recognizes the time value of money. It is the net contribution of a project to its owner’s wealth i.e the present value of future cash flows less the present value of initial capital investment. In our analysis, all the projected cash flows are discounted at 22% to their present values. This project is technically feasible as our NPV is positive i.e N18,509,188. The Benefit Cost Ratio (BCR) is 1.49 as depicted on (table ix). This shows that the project benefits outweigh the costs. Hence, the decision to consider this project as a worthwhile venture. 9.0 Conclusion While the technical feasibility and financial viability of this project has been established via our production cost estimates, revenue projection and the budget analysis on appendix. We anticipate positive socio-economic impact both at local level and abroad. This project guarantees employment creation and local food security. The project is in accordance with the national objective of increased agricultural production in the country under the Green Revolution Programme of the Federal Government. Hence, we recommend the project to any financier interested in funding viable and profitable agricultural project.
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