Coga Group

Coga GroupStrategic Steps

to Profitability and Sustainable

Growth

COGA Farms –Yesterday , Today & Tomorrow 2

Coga Group – Addressing the Issues Vision/Mission/Objective Operational performance / Expectations

in the last 3 years– Cassava / Maize / Jatropha– Processing

Financial Performance -Audited Accounts– 2006 – Half Year / 2007 / 2008

Social performance How come with the Valuation Projections & Business Plan for 2009 and

beyond Fund Drive

April 2009

VisionTo become a foremost player in commercial farming and food production in West Africa, – with key focus on poverty

eradication, – whilst transforming

agriculture into a respectable, dignifying and high paying career path.April 2009 3COGA Farms –Yesterday , Today & Tomorrow

MissionWe will consistently seek to

transform agricultural farming system in West Africa to a modern technology-driven large scale commercial farming

– And provide opportunities towards achieving sustainable community development,

– As well as redressing the demographic imbalance by reversing rural-urban drift.

April 2009 4COGA Farms –Yesterday , Today & Tomorrow


Shared Values

Integrity Excellence Teamwork Commitment

April 2009


Objective

Strategic intent is to develop 1000 Ha wihin the deadline perovided in the MoU with Kwara State Government

– Are we on course to achieving the above objective?

April 2009


The Journey –At the Begining At the commencement, there was a

clear plan of what we wanted to do Primary focus was cassava,

although the medium term plan was for integrated farming

Original plan was to engage a consultant that will help establish the farm

In 2006, we engaged IITA and a consultant was recommended to us, who we were td, was already successfully running a large scale commercial farm

April 2009


The Journey – The Consultant The Consultant provided us with a

plan, which showed that the business will be highly labour intensive

Her first task was to source for and deliver equipments.

Unfortunately the equipments and implements supplied were already badly used and wrecked

It therefore became quickly apparent to us even before we signed a formal contract that the use of a consultant will not work

April 2009


The Journey – The BDT Innovation We turned inwards and came up with a

creative idea of Business Development Team (BDT)

With the BDT concept we were able to cultivate 108 ha in 2006, even though we started farm clearing in July 2006

In 2007, we left farm staff to continue with running of the farm

We called for funds in 2007, but the response was rather dissapointing as many of the investors did not release funds in good time

April 2009


Coga Group – Need for Mechanisation

Following a strategy review of Coga operations in 2007, we realised that there was serious labour shortage in our area of operation, as we had to import labour from far distances

The labour shortage made our operations very slow and difficult

Coupled with the need to expand the farm, it was agreed that we needed to become better mechanised in order to reduce our dependency on manual labour

April 2009


The Journey – Cassava Glut In 2008 we carried out another strategic

review, which considered the glut in cassava market that started in late 2007

Many people went into cassava planting based on the policy of the Obasanjo administration, which compelled flour millers to use 10 % cassava input

Following the change in administration the policy was no longer enforced and most flour millers stopped using cassava flour, which led to cassava glut

April 2009


The Journey – Maize & Jatropha Cultivation

During the 2008 review, we also identified opportunities for diversifying into both maize cultivation and bio-fuel business

We therefore cultivated maize, as well as jatropha, which can be processed into bio-diesel

Parts of the biodiesel bi-products are also useful for ferlizer application

Alhamdullilah, the Government of Kwara state heard about our plans for Jatropha cultivation and invited us for discussion on ways to collaborateApril 2009


The Journey – KWSG Support

This lead to the government providing additional 5,000 ha of land for cultivation of jatropha alone, in addition to the 1,000 ha for cassava

In addition, KWSG promised to provide Coga with borehole and power transformer for our operations –work has commenced on both

Kwara State government also paid huge sums of money on compensation payments for the acquired land

April 2009


The Journey – Bio-Fuel Businees Opportunities

Discussion is currently ongoing between Coga Farms and foreign investors from Carlifornia USA, desirous of establishing a bio-diesel production plant in Kwara State, on an MoU for supply of jatropha feed-stock

The RED of NNPC have also visited Coga farms to assess the level of jatropha cultivation and are eager to collaborate with Coga of bio-diesel

April 2009


The Journey – 2009 Re-Structuring

Based on 2008 operations performance and results of harvesting from 2006 & 2007 cassava and 2008 maize, a performance review was carried out

This led to re-structuring of Coga Farms operations at the begining of 2009 planting season

We also engaged new staff and sent all of them, including the old staff to a large commercial farm for additional training and exposure

April 2009


The Journey – Our Current Plan We expect that InshaAllah, the re-

training of staff, re-structuring, as well as the performance based reward system we have introduced will help improve both performace of the staff and efficiency on our farm operations

In 2009 we intend to plant maize early and after harvesting we plan to immediately cultivate cassava on same land

April 2009


The Journey – The Funding Challenge

The nature of farming business requires that key resources must be made availabe at specific time –e.g. land clearing, crop cultivation, equipments availability

This ultimately requires that funds must be readily available at specific times

Due to lateness in availbality of funds in 2008, we started planting operations very late, by which time operations became very slow and difficult due to heavy rainfall

There was also an unexpected change in rainfall pattern in 2008, which started very early and lasted much longer that normal duration

April 2009


Coga Group – Re-energized For The Future

Since inception, 2009 was the 1st time we were able to start clearing operation at the appropriate time

With the experience over the last 2 years on cassava and maize, as well as with organisational re-structuring and re-training of staff, we are on the way to better performance, InshaAllah

April 2009


Coga Group – The new Working Structure

Due to our inability to immediately get an experienced GM/Farm Manger. The farm has been divided into units of 100Ha each

Each unit is headed by a District Head who supervices operation from Land clearing to Harvesting as applicable

Each Diatrict has Target/KPI and take a profit share

Each district provide cultivation plan showing weekly deliverables for the season

Weekly joint District operations and funding requirement meeting

April 2009


Coga Group – Supporting the new Structure

Group Technical– Workshop Engineer– Tractor Operators– Equipment/Implements Applications/ Operations

Commercial – Accounts– Sales– Store– Procurement

IUS– Harvesting– Labour Mobilisation/Management

Special Projects HR

April 2009


Coga Group – The new Structure Supervison

Monthly Operations Management meeting –NG and SM to join by Telephone

Monthly Visit to Farm BDT series 2 to commence from May 09

and will last till the end of cultivation operations

BoD Review– weekly activity reports from Heads of

Districts and Department– Weekly expense report from Accountant– Montly financial Statement

BoD meets monthlyApril 2009


Coga Group – Maize Collaboration To improve yield in Maize while at the

same time reducing cost we are in collaboration with Sasakawa Global 2000

Why Sasakawa They have reported the highest yield

ever of 5ton/Ha They have visited Coga Farms to access

our operation and have conducted training for our staff

They provided guidiance on proper ferterlizer application and selection and utilisation of herbicides for weed controlApril 2009


Coga Group – Cassava Collaboration To improve yield in Cassava while at the

same time reducing cost we are in collaboration with IITA and Mr Ayo Odebisi –A Renouned Agric Consultant

Why IITA and Mr Odebisi? IITA is well known for their research in crop

production world wide Mr Odebisi has been in Agric business

since the early 80s, he is a consultant to some large farms within, Federal Government and IITA

We are sourcing for fast growth hybrid and high yield Cassava variety that has high strach content, and can survive in our environment humidity

April 2009


Coga Group – Equipment Collaboration Through Mr Odebisi we are collabotation

with Mr Rafiu, an Ilorin based equipment specialist

Need for the Specialist: Sourcing for equipment at affordable

price He has been able to put back into

operation two of our tractors that have been down since 2007

He helped to source for experienced technicians for fixing our tractors

April 2009


Coga Group – Weed Control Also through recommendation of Mr Odebisi

we are in collabotation with a Nigerian company that are specialists in weed control

The weed control experts from the company have visited our farm to assess our farm and our challenges. Appropriate solutions have been recommended

Need for the weed control specialist: Apart from 2006, we have had weed

challenges and this is one of the areas we intend to reduce cost.

We need to re-train our staff on proper application of herbicides.

April 2009


Coga Group – 2006/7 Performance Review

In 2006 we cultivated 108 ha of cassava, with expected yield of 20 tons/ha

Actual yield is yet to be confirmed as harvesting is still ongoing

Current average indication from harvested areas is 15 tons/ha

In 2007 we cultivated 198 ha of cassava, with expected yield of 20 tons/ha

Harvesting is also ongoing in the area and actual average yield will be determined after after completion of harvest in Q2 2009

April 2009


Coga Group – 2008 Performance Review

In 2008, we cultivated 61 ha of cassava, 70 ha of maize and 22 ha of jatropha, leaving over 40 ha of cleared land unplanted, due to lateness in fund availability

Projected yield for maize was 1 ton/ha, but the average actual yield was 0.9 ton/ha

Jatropha plant matures in about 9 months, but indications from the current visual inspection is that we will InshaAllah meet our projections of 3 tons/haApril 2009


Coga Group – Processing Operation Review

Plan for processing was to process cassava into flour, starch and garri

The processing plant with be built in modules

Orders were placed for all processing equipments and some of them have arrived

We also engaged a consultant on cassava processing, who has assisted with the planning and set up of processing plant

The 1st module of the processing plant has been completed and garri processing is already ongoing

April 2009


Coga Group – Cassava Market Potential

The size of cassava farm market in Nigeria is enormous

Nigeria Starch Mill alone requires 400 ton of fresh Cassava tubbers per day for their starch production plant, which has capacity of about 10,000 ton per month

April 2009


Coga Group – Market for Starch, Garri and Flour

April 2009


Coga Group – Other Efforts KWSG has already mobilised a

contractor for borehole drilling and for electrification of Coga premises

We have sent bid to the Federal Government on public/private partnership for establishment of agro processing plants

We have sent a bid to Federal Government for sale of grain to government for national grain reserve

2009 is a critical year for us to turn things around in Coga and to make us attractive for external investorsApril 2009


Coga Group – Social Performance Our operations in Moro LGA of Kwara

State has significantly enhanced the economy and quality of life of our host communities, including Bode Saadu, Jebba and beyond.

We have also impacted human capital development in Kwara State.

The presence of Coga has improved socio-economic well-being of individuals and businesses in Kwara State.

Coga has drawn attention of the KWSG to Moro LGA

Rural/urban drift has considerably reduced in Moro LGAApril 2009


Financial Summary –Sources & Application of Funds

April 2009

2006 (Half year) 2007 2008

Sources and Application of Funds N N NSource Shareholders Subscription 42,301,450 84,301,450 132,051,450 Creditors - - 12,688,757

42,301,450 84,301,450 144,740,207

ApplicationFarm Mechanisation 20,122,500 23,071,150 38,899,150 Land Development 7,049,398 21,244,619 36,442,652 Other debtors & prepayments 3,084,212 3,345,469 6,910,379 Crop Planting 5,756,603 16,195,644 28,262,035 Staff Salaries 2,321,639 6,998,301 14,882,933 Other cash operating exp. 2,208,723 5,205,985 8,955,290 Bank Balance 1,758,375 8,240,282 10,387,768

42,301,450 84,301,450 144,740,207 Shareholders Subscription

Concordial 13,701,450 27,701,450 48,051,450 FoGTIL 15,000,000 27,000,000 45,000,000 RIYAN 5,600,000 14,850,000 19,500,000 MAN 3,750,000 7,500,000 9,750,000 MAIL 1,250,000 3,250,000 4,250,000 GAIN 2,500,000 3,500,000 3,500,000 BANI 500,000 500,000 2,000,000

42,301,450 84,301,450 132,051,450

P & L Extract

Sales Revenue - - 5,693,370 Other income 21,536 89,121 79,056

Total Revenue 21,536 89,121 5,772,426

Crop planting 5,756,603 10,439,041 12,066,391 Staff salaries 2,321,639 4,676,672 7,884,632 Other cash operating exp. 2,208,723 2,997,262 3,749,305 Depreciation 1,429,468 3,472,734 4,476,683

11,716,433 21,585,709 28,177,011

Loss Before Tax 11,694,897- 21,496,589- 22,404,585-


Financial Summary – Profit & Loss

April 2009

2006 (Half year) 2007 2008

Sources and Application of Funds N N NSource Shareholders Subscription 42,301,450 84,301,450 132,051,450 Creditors - - 12,688,757

42,301,450 84,301,450 144,740,207

ApplicationFarm Mechanisation 20,122,500 23,071,150 38,899,150 Land Development 7,049,398 21,244,619 36,442,652 Other debtors & prepayments 3,084,212 3,345,469 6,910,379 Crop Planting 5,756,603 16,195,644 28,262,035 Staff Salaries 2,321,639 6,998,301 14,882,933 Other cash operating exp. 2,208,723 5,205,985 8,955,290 Bank Balance 1,758,375 8,240,282 10,387,768

42,301,450 84,301,450 144,740,207 Shareholders Subscription

Concordial 13,701,450 27,701,450 48,051,450 FoGTIL 15,000,000 27,000,000 45,000,000 RIYAN 5,600,000 14,850,000 19,500,000 MAN 3,750,000 7,500,000 9,750,000 MAIL 1,250,000 3,250,000 4,250,000 GAIN 2,500,000 3,500,000 3,500,000 BANI 500,000 500,000 2,000,000

42,301,450 84,301,450 132,051,450

P & L Extract

Sales Revenue - - 5,693,370 Other income 21,536 89,121 79,056

Total Revenue 21,536 89,121 5,772,426

Crop planting 5,756,603 10,439,041 12,066,391 Staff salaries 2,321,639 4,676,672 7,884,632 Other cash operating exp. 2,208,723 2,997,262 3,749,305 Depreciation 1,429,468 3,472,734 4,476,683

11,716,433 21,585,709 28,177,011

Loss Before Tax 11,694,897- 21,496,589- 22,404,585-


Coga Group – Valuation

Valuation for the recent invitation for investment in Coga Group was by based on the existing book value, including good will

April 2009


Why The Fund Drive? We need to keep focus on our original

objective –i.e. MoU with Kwara State Government to develop 1000 Ha within certain time frame

To achieve capatalisation base for growing the business via IDB funding

To deliver the strategic change in operational approach –from labour intensive operations to fit-for-purpose mechanisation

April 2009


Coga Group – Application of Fresh Fund

1. Full mechanisation 2. Land clearing and management3. Improved Cultivation Techniques

a. Fertilizerb. Chemicals for Weed control

4. Weigh bridge5. Maize dryer6. Processing7. Communication8. Mobility9. Infrastructure10. Water

April 2009


Coga Group – Projections for 2009

April 2009


Coga Group – Yesterday, Today & Tomorrow

Coga …Yesterday, it was a dream

Today, it is realityTomorrow, it will be a success story, InshaAllah

… And there is no success, except with Allah

April 2009


Coga Group…While others are afraid ….Great

Companies have emerged during periods of crisis leveraging on their people and organization capacity to empower their people to be BOLD, STRATEGIC and provide returns to investors soon.

April 2009

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Coga Group

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