PROSPECTUS - THE PREMIER IRISH FORESTRY FUND PHASE II PLC.
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PROPOSED FOREST PLAN.
The table of the proposed Forest Plan is set out below:
2000 | Purchase of suitable land | Cultivation of land, fencing, trees planted and access road laid. |
2015 | Road enhancement process | To ease access further and help with extraction process. |
2016 | Thinning of trees | To ensure sufficient ground nutrients, light, and space to stimulate and improve growth on remaining trees. |
2017 | Repairs and high prune | To ensure adequate drainage channels and sufficient fencing. High prune to 3.5 meters. |
2020 | Further thinning of trees | To ensure strongest trees survive and thus highest quality. |
2021 | Further repairs and high prune | To ensure adequate drainage channels and sufficient fencing. High prune to 6 metres. |
2024 | Further thinning of trees | To ensure promotion of strongest and best trees |
2025 | Repairs | To ensure adequate drainage channels and sufficient fencing |
2030 | Sale of Standing Timber and underlying land | To obtain the maximum return for the investors. |
ILLUSTRATIVE FINANCIAL RETURNS.
The directors have taken all reasonable steps to ensure that the potential financial returns from this investment, which are illustrated hereunder, have been calculated accurately and that the assumptions on which this illustration is based are fair and reasonable. This is not a prediction, and actual returns could be more or less than those illustrated.
On that basis, each £1,000 share should return an amount of £35,009 tax free after a thirty year period. This represents an average return rate of 12.58% compounded annually on the amount initially invested, which is 8.58% ahead of annual inflation, assuming a rate of 4%.
The principal assumptions on which these calculations are based are as follows:
1. Initial set-up costs will amount to 7.5% of capital. 92.5% of capital will be invested directly in land acquisitions.
2. Only land of high yield- class be acquired. The calculations are based on land which will be planted in year 1 and harvested in year 30.
3. Inflation has been assumed to average 4% per year.
4. The potential increase in the real value of timber has been ignored. Returns are based on current timber prices, increased in line with inflation only and an increase in land prices consistent with historical trends..
5. The costs of establishing the new forest plantations will be fully met by the afforestation and maintenance grants and premia.
6. The following costs and grants are assumed to be incurred:
Cost Description
............... IR£ Amount per Hectare......... Grant Available
Forest establishment........
1,800............................................................. Yes.
Pruning....................................
375.............................................................
Yes.
Roads.......................................
220.............................................................
Yes.
Pruning....................................
425.............................................................
Yes.