RFM Almond Fund 2006

Fund Overview
Fund Assets
Performance & Financial Information

 

Fund Overview

The aim of the RFM Almond Fund 2006 (AF06) is to provide investors (“Growers”) with the opportunity to operate an almond growing business capable of generating competitive risk-adjusted returns. The business attracts tax deductions supported by ATO Product Rulings PR 2006/24 and PR 2006/25.

AF06 Growers participate in the business of growing and selling almonds for the world market. Each Grower is licensed to occupy and farm one or more Groves each consisting of an area of 0.25 hectares (ha). Each Grove is planted with approximately 70 almond trees and has sufficient water entitlements delivered via a modern irrigation system to cultivate and farm the trees. Grower returns are dependent upon the performance of their almond growing business. Returns are generated from the almond sale proceeds, less the annual operating and management costs including the lease of land and operational infrastructure. The AF06 terminates on 30 June 2026 with no further obligations to the Growers.

As Responsible Entity, RFM is responsible for orchard operations, maintenance, harvesting, pre-processing and delivery. RFM also manages all accounting and administrative functions of the AF06.

The AF06 is closed to new investment.

AF06 2010 Tax Invoice

On 17 May 2010 RFM issued the 2010 tax invoice to AF06 Growers for their share of the Management Fee, Licence Fee and Operating Costs. The invoice comprised of actual costs between July 2009 and April 2010 with estimates for May and June 2010. An adjustment note will be provided to Growers in October to reconcile any differences.

Table 1: AF06 fees applicable per Grove for the 2010 financial year

Itemised Cost per Almondlot Fee GST Total
Management Fee $181.70 $18.17 $199.87
Licence Fee $998.13 $99.81 $1,097.94
Operating Costs Employee costs $357.18 $35.72 $392.90
Services & contracts $361.52 $36.15 $397.67
Consumables, materials, fuel, repairs & maintenance $1,019.34 $101.93 $1,121.27
Plant & equipment leases, rental & hire $259.42 $25.94 $285.36
Misc other $283.65 $28.37 $312.02
Interest $148.25 n/a $148.25
Total $3,609.19 $346.09 $3,955.28
Less: harvest proceeds from 2009 crop $486.67 n/a $486.67
Total Invoiced per Grove $3,122.52 $346.09 $3,468.61

The price achieved by AF06 depends on a range of factors, including the size of the Californian crop, worldwide supply and demand and exchange rate fluctuations.

The price per kilogram achieved for the RFM AF06 2009 harvest was $4.64. Early indications from Almondco are that the 2010 harvest will achieve a price of approximately $5.80 per kilo.

The Price Management Plan

In order to reduce price volatility, RFM developed a unique Price Management Plan ("PMP") to provide price support for Growers for up to the first ten years of AF06. RFM will pay the Growers up to $3.50 per kilogram on top of the sale price, if the sale price received is less than $8.20 per kilogram.

Any payment to the Growers as result of the PMP will be made after the final price per kilogram for the harvest is determined by Almondco. For the 2009 harvest, this payment to Growers is expected to be in June 2010.

Yield

The first harvest was conducted successfully in early 2009 although wind damage to the trees in December 2008 reduced the 2009 yields. Approximately 30% of the AF06 orchard was damaged by windstorms with 50% of these trees expected to return to normal production by 2010.

The forecasted yield for the 2010 harvest is 0.9 tonnes per hectare or 225 kilograms per Grove. The forecasted yield is below levels outlined in the PDS due to the December 2008 wind event mentioned previously.

Modern mature almond orchards using industry best practice are consistently achieving 3.5 tonnes of almond kernel per hectare. The RFM AF06 almond trees are all are expected to reach mature yields by 2014.

For up to date farm information please refer to the most recent newsletter.

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Fund Assets

The number of groves on issue for the Almond Fund 2006 at 30 June 2010 was 1,063.

The total number of Growers was 215.

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Performance & Financial Information

No performance data yet available.

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Key Documents