THE WORLD ALMOND INDUSTRY
STRONG WORLD DEMAND
|
• |
Strong demand for almonds with world consumption
growing. |
|
• |
A recent survey of US consumers showed an
increasing awareness of the positive health
benefits which continues to push demand to
include almonds in a range of products. |
|
• |
Strong recommendations from medical authorities
to include almonds as a component of your
regular diet. |
WORLD ALMOND PRICE
|
• |
The trend in almond prices has been steadily
increasing due to the rising world demand. |
|
• |
The price earned by Australian producers is
largely governed by the world almond price and
the AUD/USD exchange rate. |
|
• |
Almondco Australia Ltd (the Processing and
Marketing Agent) exports a significant
proportion of its annual throughput to a wide
range of countries. This helps to build the
reputation of Australian quality production and
increase international demand so that as
Australian production rises export markets are
available. |
VERSATILE AND VALUED NUTRITION SOURCE
|
• |
Almonds are a valued food source in a large
number of countries and cultures. |
|
• |
Almonds are a core ingredient in a large number
of foods and snacks that we all enjoy each day -
breakfast cereals, snack bars, cakes, muffins,
confectionary - and of course they taste good on
their own. |
PROJECT STRUCTURE -
TWO SCHEMES IN ONE PROJECT
GROWER SCHEME
|
• |
100% deduction - Grower Application Fee is 100%
tax deductible |
|
• |
Ongoing deductions - for Irrigation
infrastructure write off, Growing and Management
fees and Lease fees |
|
• |
17 Year Project term - The Grower receives the almond sales proceeds for 17 years and then all proceeds are paid to the Asset Trust |
|
• |
Joint Venture Arrangement - An individual can pay the application monies and their self managed superannuation fund or other related party can pay the subsequent costs until the orchard becomes profitable. From that time all orchard income is allocated 39% to the individual and 61% to the other entity. |
ASSET TRUST
|
• |
OWN not RENT - Asset Ownership via the Asset
Trust: |
|
• |
WATER - a valuable resource with a rising
capital value |
|
• |
LAND and TREES - the Land and Trees that form
the Orchard |
|
• |
Initial outlay Nil - achieved through AIL’s
unique Asset Trust structure |
|
• |
Distributions - the Lease fee paid by the Grower
(and tax deductible to the Grower) flows to the
Asset Trust and supports annual distributions |
|
• |
Full Orchard proceeds - from Year 18 (when the
Grower leases have ended) all the orchard
proceeds flow to the Asset Trust and support
distributions |
|
• |
Capital gain - when assets are sold (at Project
end) any capital gain is received as a
distribution |
INTRODUCING THE 2010 PROJECT
The 2010 AIL Almond Orchard Project is a unique
combination of 2 different arrangements, the
Grower Scheme and the Asset Trust. This is done
so that Investors can benefit from ownership of
the orchard assets by owning units in the Asset
Trust and receive significant financial benefits that flow from OWNING not RENTING.
The Grower Scheme operates via leases held by
the Grower over the orchard assets. This gives
rise to the tax deductibility of fees and an
income stream from the orchard for the 17 year
term of the leases.
After this time, the almond trees still have a
significant period of economic life. All the
future production flows to the Asset Trust and
is received by Investors via an annual
distribution. Units in the Asset Trust can be
owned by a different entity than the Grower -
such as a superannuation fund which may enable
an efficient tax position.
The assets held in the Asset Trust - WATER
RIGHTS, LAND and TREES have real economic value
and any sale of these assets (at the end of the
Project) may give rise to a gain that will be
distributed to the owners.
WHY ALMONDS WITH AIL?
|
• |
Project management experience - AIL has
developed orchards valued at over $180M. |
|
• |
Product Ruling PR 2010/3 - provides confidence
and certainty for Growers regarding tax
deductibility. |
|
• |
Asset Ownership - why rent the orchard when you
can own it? |
|
• |
Modern Water Management - the most up to date irrigation systems and the application of new almond growing technology and research helps ensure commercial production even in drier conditions. |
WHAT WILL I OWN PER ALLOTMENT?
|
Almond Allotment leases |
1 |
|
Land* |
0.125 Hectares |
|
Water shares* |
1.56 Megalitres |
|
Trees* |
40 |
|
Irrigation infrastructure value |
$ 3,000 |
|
* held via units in the Asset Trust |
FEES PAYABLE ON APPLICATION AND IN YEARS 1
& 2
|
ON APPLICATION |
| Grower Application Fee |
$5,600 |
Immediately deductible |
| Grower Irrigation Fee |
$2,000 |
Fully deductible over the next 2 years |
| Asset Unit holder |
Nil on application |
$540 to be paid by instalments from distributions of income or capital commencing from Project Year 1. |
| YEARS 1 And 2 |
| Grower |
$2,300 in Year 1 and $2,400 in the following year |
Both payments deductible in the year paid |
|
In the following years the Grower position is based on Almond harvest proceeds less operating costs. Refer to the PDS for full details of all costs. |
WHAT TAX BENEFITS WILL I RECEIVE?
| |
TAX DEDUCTIONS |
GST REFUND |
| On Application (2010) |
$5,091 |
$691 |
| Year 1 (2011) |
$3,000 |
$209 |
| Year 1 (2012) |
$3,091 |
$218 |
Intending applicants should note that a Product Ruling does not constitute an endorsement or guarantee by the Commissioner of Taxation or the ATO as to the commercial viability of the Grower Project or the reasonableness or otherwise of any fees charged in connection with the Grower Project and that it will only be binding on the Commissioner of Taxation if the Grower Project is implemented in the specific manner described in the Product Ruling.
The fees and tax benefits will vary if an investor chooses to enter into a Joint Venture arrangement. Please contact AIL for further information.
Almond Investors Limited (ABN: 13 102 342 870, AFSL No:224314) (“AIL”) is the Responsible Entity for the 2010 AIL Almond Orchard Project. For more information please refer to www.ailfunds.com.au. To the extent the information contained in this document constitutes advice, it is general advice that has been prepared without reference to any existing or prospective investors’ personal objectives, financial situation or needs. Prospective Investors should obtain and consider the relevant product disclosure statement, consider the appropriateness of advice and obtain financial, legal and taxation advice before making any financial investment decision. Investment involves risks. Any estimates in this information may differ from actual results and should not be taken as forecasts. Past performance is not indicative of future performance. This information is provided to you by AIL on an as is basis, without warranty of any kind either express or implied. It is believed to be accurate and current at the date production. AIL will not be liable for any loss or damage suffered from reliance on this information.
|
