Interim Report - 19 January 2011

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Cambium Global Timberland Limited

Unaudited condensed consolidated interim report and nancial statements 2010 26


Unaudited condensed consolidated interim reportand fnancial statementsfor the six months ended 31 October 2010Registration number: 95719


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The Company provides exposure to the worlds

timberland markets through developmentprojects in high growth regions and standingtimber in developed markets.

About us

IFC About us

01 Highlights02 Chairmans statement03 Investment managers report06 Unaudited condensed consolidated

interim statement of comprehensiveincome07 Unaudited condensed consolidated

interim statement of nancial position

08 Unaudited condensed consolidatedinterim statement of changes in equity

09 Unaudited condensed consolidatedinterim statement of cash ows

10 Notes to the unaudited condensedconsolidated interim nancialstatements

IBC Key parties


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Highlights

Completed large land sale in the United States

Land preparation completed to make way or planting 2.3 million

seedlings on 5,700 acres in Brazil

Obtained American Tree Farm System certication or US assets


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Unaudited condensed consolidated interim report and nancial statements 201002

The period covered by the interim

nancials saw many positivedevelopments including land salesand additional land preparationto make way for the planting ofapproximately 2.3 million seedlingson 5,700 acres in the Cambiumportfolio. The period also proved tobe a difcult one for many timberlandowners including Cambium GlobalTimberland Limited. The CompanysNet Asset Value (NAV) as of31 October 2010 is 80 pence per share

compared to 91 pence per share atyear end 30 April 2010. A dividendof 3 pence per share was paidduring the period. Since inceptionin March 2007 total returns havebeen -10.9% compared to a -6.4%return for the FTSE EPRA/NAREITGlobal Real Estate Index Series and a-21.8% return for the FTSE AIM index.Neither index tracks timberland valuesbut they do provide for a comparisonof returns across asset classes over theperiod. The NAV of the Company wasprimarily impacted by both the costof the options and the portion ofthe Sterling appreciation that wasunhedged. There was also areduction in the appraised valueof the timberland properties duringthe period.

The negative impact of revaluationson the appraised value of the portfolioof approximately -2.7% over thesix months was primarily due to

an adjustment to one of the twoproperties in Hawaii. The adjustmentwas made for damage associated

with the sulphur dioxide emissions

from a volcanic vent located upwindfrom the plantation. Additionally, theland value component of the USSouth properties was reduced duringthe period as third-party valuationscaught up with current market realities.We do not anticipate further losses fromeither the volcanic emissions or landvalues in the southern United States.

As we have communicated previously,the Company is using options on

currencies to hedge the impact offoreign exchange movements. Theoptions are purchased out of themoney in order to reduce the optionpremiums paid by the Company, andtherefore do not protect the rstfew percent of loss due to Sterlingappreciation. During the periodcovered by these interim reports, theCompany had a loss of approximately1.0% of the NAV on the optioncontracts themselves and anadditional loss of about 2.4% of theNAV due to Sterling appreciation. Muchof this loss has beenrecouped since theend of this reporting period as Sterlingwas weakened against the US Dollarand Brazilian Real, our two maincurrency pairs.

The rst half of the scal year hasbeen very active and we have takensteps to improve the liquidity ofthe portfolio and will reallocate thiscapital into higher risk-adjusted return

projects, particularly in Brazil. In Maya $20,000,000 loan facility was takenout at attractive rates. Since the end

of the reporting period we havecompleted the sale of 14,273 relativelyimmature acres in the southern UnitedStates for 97% of the 30 April 2010NAV. These assets representedapproximately 13.3% of the portfolio.Approximately $5,310,000 of theproceeds from the land sale has beenused to retire debt. Additionally, the3,200 acre asset in New Zealandwas contracted to sell at 118% of30 April 2010 NAV. The asset inNew Zealand represents 4.1% of

the NAV. We believe that thesetransactions provide market testedsupport for the valuation process.

We will announce the dividend forthe Company with the year endreport. In the absence of unseencircumstances we will maintainthe dividend at the current level.

We believe that the characteristicsof low-volatility and high long-termrisk-adjusted returns compared withother asset classes identied at thetime of the Companys launch remainvalid. The Board and the InvestmentManager are optimistic that theCompanys portfolio of investmentsprovides balanced and diversied globalexposure to an attractive asset class.We look forward to updating you onour progress with the full-year resultsfor the period ending 30 April 2011.

Donald AdamsonChairman18 January 2011

Chairmans statement

We believe that the characteristics o

low-volatility and high long-term risk-adjustedreturns compared with other asset classesidentifed at the time o the Companys launchremain valid.


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Investment managers report

The two primary actions during the period were

the $20,000,000 loan in May and the large landsale which closed in November.

We believe, as constructed, the

global portfolio of timberlandproperties provides exposure todevelopment projects in high growthareas and standing timber in theworlds most developed timbermarkets. We are encouraged byincreases in product prices acrossmost of our target markets duringthe period and believe this trend willcontinue. We are happy with theactions we were able to take throughthe rst half of the year including the

large land sale in the United States,the smaller non-strategic land sales,the execution of a sale contract at afavourable price for the property inNew Zealand and the low costloan facility.

While the nancial results duringthis period are disappointing, wetook a number of steps during theperiod to maximise the return fromthe Company going forward. Thetwo primary actions during the

period are the $20,000,000 loanin May and the large land salewhich closed in November. Fromthe sale proceeds, $5,310,000 wasused to retire debt. Both of thesetransactions provided liquidity andbalance sheet exibility to investin higher returning investmentsprimarily in Brazil. Plantationestablishment in Brazil remainsthe most signicant ongoinginvestment activity and we

anticipate investing an additional

R$9,000,000 (3,700,000) during

this planting season.Administrative expenses for theCompany, including the InvestmentManagers fees, the Directors feesand the legal and other professionalfees associated with running theCompany and all of the subsidiaries,were about 820,000 for theperiod covered by the nancials.We anticipate the administrativeexpenses of the Company willremain near this level of slightlyless than 2% of net assets on anannual basis.

As of 31 October 2010, the Companyhad investments in each of thefollowing areas:

US SouthThe primary end-use market servedby our properties in the UnitedStates is housing. Through August,United States housing starts were412,000 year-to-date, about 8%above the same period in 2009.Additionally pine-saw log priceswere 6% higher then the averagefor the same period last year.Although we are pleased with thepositive improvement in stumpageprices, like many forestland owners,we will continue to store pine logtimber inventory on the stump. Pinepulpwood harvest continues in thesouth as prices for this productcontinue to be attractive to

timber growers.

The US South comprised

approximately 49% of the valueof the portfolio prior to the landsale and about 35% after the landsale. During the rst half of theyear, the properties declined invalue by 4.9%. Property values havecontinued to be impacted by thedifculties of the building productmarkets and increased returnexpectations of timberland buyers.During the period, the propertiesproduced revenue of $1,030,000

from the harvest of timber andrecreational leases and $470,000from the sale of non-strategic land.The timber sales were primarilyfrom pulpwood thinning harvests.The land sale yielded a price at apremium to the fair value as of30 April 2010. Non-strategic landsales remain a key part of thestrategy in these areas and willcontinue as long as we own theseassets. These timberlands willcontinue to generate positivecash ows from timber harvest,recreational leases and non-strategicland sales for the foreseeable future.

On 30 September 2010 weannounced the sale of 14,273 acresof timberland in the United States.The transaction generated netproceeds of approximately$18,100,000, representing 97% ofthe 30 April 2010 NAV and 111%of the Companys cost basis. This

land sale closed on 24 November2010. After the retirement of debt,


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the balance of the proceeds

from the sale will be reallocatedto higher returning investmentsprimarily in Brazil.

During the period the propertieswere enrolled in an American TreeFarm System (ATFS) certicationscheme. The ATFS, a programmeof the American Forest FoundationsCenter for Family Forests, iscommitted to sustaining forests,watershed and healthy habitatsthrough the power of privatestewardship. ATFS has establishedstandards and guidelines forproperty owners to meet to becomea Certied Tree Farm. Under thesestandards and guidelines, privateforest owners must develop amanagement plan based on strictenvironmental standards and passan inspection by an ATFS volunteerforester every ve years.

Hawaii

The properties in Hawaii areinuenced predominately by thewoodchip and log import marketsin the Pacic Rim. We anticipatestronger markets for both woodchips and saw logs in 2011 as theglobal market continues to recover.The largest market is eucalyptuswood chips destined for pulp millsin Japan and China and the locationof the assets in Hawaii is favourableto these growing end-user markets.

The logs on these assets arecurrently being marketed to a mix

of end users including pulp and

paper and energy producers.The Hawaii properties comprise9% of the portfolio. This year weexperienced a write down of thePahala asset due to the sulphurdioxide emissions from a volcanicvent that began emitting afterthe asset was acquired. The impacthas been some mortality of thestanding timber and generalstunting of tree growth whichimpacts the nal harvest. ThePinnacle asset has not beenimpacted by the emissions andcontinues to increase in value as itbenets from excellent biologicalgrowth. The net decline in the NAVof these assets over the six monthsis 15.5% and we do not anticipatefurther reductions from the volcanicgas in the future.

Although we conduct our forestryoperations in an environmentallyconscientious manner, there isno plan for certication of theseproperties at this time. As we donot own the land and cannotcontrol the land use after the leasesexpire, we are unable to receiveForest Stewardship Council(FSC) certication.

Australia/New ZealandChina continues to be the drivingforce for the log markets in Asia.Australia, New Zealand, the

United States Pacic Northwest

and Canada have beneted from

this demand for softwood logs andnished lumber. Prices for radiatapine in the third quarter of 2010were approximately 21% higherthan the same period last year.

The Australia/New Zealandproperties represent 12% of thevalue of the portfolio. During theperiod we entered into a contract tosell the asset in New Zealand. Theprice achieved was at a premium tothe 30 April 2010 NAV. Proceeds fromthe land sale will be approximatelyNZ$7,080,000 and will allow us tocontinue to invest in the highgrowth timber markets in Brazil.

The asset located in Australiagenerated AU$1,850,000 in proceedsfrom the sale of non-strategic landand other assets associated withthe land. This sale was completedat the NAV as of 30 April 2010.Planting on the property has beencompleted and maintenance

activities are minimal over therotation length.

The asset in New Zealand is FSCcertied and we are currentlyreviewing the certication optionsfor the Australia asset.

BrazilBrazil continues to be the mostimportant ongoing investmentproject of the Company. Properties

are being developed to capitalise onexisting charcoal markets to be sold

Investment managers report continued

Brazil continues to be the most important

ongoing investment project o the Company.


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The frst hal o the fscal year has been very

active and we have taken steps to improve theliquidity o the portolio and will reallocate thiscapital into higher risk-adjusted return projects.

to pig iron producers and emerging

pulp markets. Global pulp productionwas near record highs in the thirdquarter of 2010. South America hasbecome a much more importantplayer in the global market forbre-based market pulp the pastve years and this trend is expectedto continue. In Brazil, the marketsfor charcoal used for the pig ironindustry have improved sinceexperiencing a decline in 2009 andthe average price for charcoal in

2010 is 35% improved over 2009.The Brazil properties represent 29%of the overall value of the portfolio.Over the six months the propertiesproduced returns of -5.4% due toa downward adjustment for landvalue as well as expenditures forsite preparation that are not valueduntil the trees are planted, whichwill occur in the second half of thescal year. We do not anticipateland values to decline further. As

the planted timber continues togrow, the biological growth willadd signicant value and driveNAV gains.

As part of our ongoing investmentprogram in Brazil, we completedthe site preparation work to makeway for the planting of approximately2.3 million seedlings on 5,700 acreswhich will occur in the second halfof the year. At the end of thisplanting season in May we will

have planted 13,500 acres,representing approximately 50%

of our plantable acreage in Brazil.

The remainder of the property willbe established over the next twoyears. We anticipate the propertieswill become cash ow positivebeginning in 2015. We have begunthe certication process on theseproperties and it is anticipatedwe will achieve certication acrosseach of the properties in Brazilover the next 618 months.

The rst half of the scal yearhas been very active and we havetaken steps to improve the liquidityof the portfolio and will reallocatethis capital into higher risk-adjustedreturn projects. The portfolio islocated in favourable proximity tosome of the fastest-growing timbermarkets including Brazil and Asia.The global timber environmentcontinues to improve in most ofthe regions where Cambium ownstimber and timberland and webelieve this bodes well for our

investors. The existing portfolio hasbeen designed to meet the returnand cash ow targets that wereoutlined in the initial Prospectus.While disappointed in the resultsduring the period, we are condentthat the actions we took will seekto maximise return in the long term.

CP Cogent AssetManagement LPInvestment Manager

18 January 2011


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For the For thesix months six months

ended ended

31 October 31 October2010 2009

Unaudited UnauditedNotes

Revenue 4 769,769 569,835Cost of sales (589,213) (301,031)

Gross prot 180,556 268,804

Decrease in fair value of investmentproperty and plantations 12 (2,541,145) (254,881)Administrative expenses 5 (844,011) (1,025,954)Other operating forestry expenses (1,573,445) (1,284,671)Prot on sale of plantations 13 132,843 Revaluation of buildings, plant and equipment 14 (37,279)Prot on sale of xed assets 15 18,097

(2,266,516) (2,347,904)

Operating loss (4,627,105) (2,333,981)

(Loss)/prot on foreign currency options 21 (952,036) 297,444Finance income 6 20,522 27,109Finance costs 7 (339,053) (2,779)Net foreign exchange (loss)/gain (223,323) 2,973,317

Net nance (expense)/income (1,493,890) 3,295,091(Loss)/prot before taxation (6,120,995) 961,110Taxation charge (266,960) (520,507)

(Loss)/prot for the period attributable to shareholders (6,387,955) 440,603

Other comprehensive income

Foreign exchange losses on translation of foreign operations 21 (2,037,538) (3,948,466)Increase in fair value of intangible assets 9,447Disposal of intangible asset to revaluation reserve 17 (54,885)

Other comprehensive income for the period (2,092,423) (3,939,019)

Total comprehensive income for theperiod attributable to shareholders (8,480,378) (3,498,416)

Basic and diluted (loss)/earnings per share 10 (6.13) pence 0.42 pence

All items in the above statement are derived from continuing operations. All income is attributable to the equityholders of the parent company. There are no minority interests.

The notes on pages 10 to 24 form an integral part of these unaudited condensed consolidated interimnancial statements.

Unaudited condensed consolidated interim statemento comprehensive incomefor the six months ended 31 October 2010


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31 October 30 April 31 October2010 2010 2009

Unaudited Audited Unaudited

Notes

Non-current assets

Investment property 12 53,898,824 58,062,195 50,669,026Plantations 12 35,355,414 36,873,332 29,801,885Buildings, plant and equipment 14 131,165 431,245 517,197Intangible assets 16 162,511 146,833Deferred tax assets 4,117 32,031 191,471

89,389,520 95,561,314 81,326,412

Current assets

Cash and cash equivalents 22 8,039,509 3,087,414 14,648,714

Trade and other receivables 18 163,005 559,461 365,383Financial assets held at fair valuethrough prot and loss 20 4,128,837 1,294,939 4,325,183

12,331,351 4,941,814 19,339,280

Total assets 101,720,871 100,503,128 100,665,692

Current liabilities

Trade and other payables 23 1,936,001 1,384,438 1,830,003

1,936,001 1,384,438 1,830,003

Non-current liabilities

Bank loan 19 12,173,263 Deferred tax liabilities 4,182,365 4,085,170 3,626,973

16,355,628 4,085,170 3,626,973

Total liabilities 18,291,629 5,469,608 5,456,976

Net assets 83,429,242 95,033,520 95,208,716

Equity

Stated capital 25 2,000,000 2,000,000 2,000,000Distributable reserve 26 92,806,700 95,930,600 95,930,600Translation reserve 26 18,388,805 20,426,343 13,339,663

Revaluation reserve 26 6,603 61,488 74,791Retained loss (29,772,866) (23,384,911) (16,136,338)

Total equity 83,429,242 95,033,520 95,208,716

Net asset value per share 11 0.80 0.91 0.91

These nancial statements were approved and authorised for issue on 18 January 2011 by the Board of Directors.

Donald Adamson Martin RichardsonDirector Director


Unaudited condensed consolidated interim statemento nancial positionat 31 October 2010


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For the six months ended 31 October 2010 (unaudited)

Stated Distributable Translation Revaluation Retained

capital reserve reserve reserve earnings Total

At 30 April 2010 2,000,000 95,930,600 20,426,343 61,488 (23,384,911) 95,033,520Loss for the period (6,387,955) (6,387,955)Loss on sale of intangible asset (54,885) (54,885)Foreign exchange movement (2,037,538) (2,037,538)Total comprehensive incomefor the period (2,037,538) (54,885) (6,387,955) (8,480,378)

Dividends (3,123,900) (3,123,900)

At 31 October 2010 2,000,000 92,806,700 18,388,805 6,603 (29,772,866) 83,429,242

For the six months ended 31 October 2009 (unaudited)

Stated Distributable Translation Revaluation Retainedcapital reserve reserve reserve earnings Total

At 30 April 2009 2,000,000 99,219,500 17,288,129 65,344 (16,576,941) 101,996,032Prot for the period 440,603 440,603Foreign exchange movement (3,948,466) (3,948,466)Revaluations in period 9,447 9,447Total comprehensive income

for the period (3,948,466) 9,447 440,603 (3,498,416)Dividends (3,130,500) (3,130,500)Share buy-back (158,400) (158,400)

At 31 October 2009 2,000,000 95,930,600 13,339,663 74,791 (16,136,338) 95,208,716


Unaudited condensed consolidated interim statemento changes in equityfor the six months ended 31 October 2010


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For the For thesix months six months

ended ended


Unaudited UnauditedNotes

Cash ows from operating activities

Operating loss for the period (4,627,105) (2,333,981)Adjustments for:

Decrease in fair value of investment property and plantations 12 2,541,145 254,881Prot on sale of land and plantations 13 (132,843) Depreciation 14 884 760Revaluation of buildings, plant and equipment 14 37,279

Prot on sale of xed assets 15 (18,097) Decrease in trade and other receivables 376,124 18,535Increase in trade and other payables 330,099 678,063

3,097,312 989,518

Net cash used in operating activities (1,529,793) (1,344,463)

Cash ows from investing activities

Cost capitalised to plantations 12 (1,513,630) (1,413,530)Purchase of land and plantations 12 (2,337,205)Net proceeds from sale of plantations 13 987,031 Purchase of buildings, plant and equipment 14 (318)

Net proceeds from sale of property, plant and equipment 15 311,174 Net proceeds from sale of intangible asset 16 57,476 Gain on options 172,800 Options acquired (3,958,746) (1,059,000)

Net cash used in investing activities (3,943,895) (4,810,053)

Cash ows from nancing activities

Bank loan taken out 12,408,678

Share buy-back (158,400)Dividend paid 9 (3,123,900) (3,130,881)Finance income 6 20,522 27,472Finance costs (574,468) (2,779)

Net cash from/(used in) nancing activities 8,730,832 (3,264,588)

Net increase/(decrease) in cash and cash equivalents 3,257,144 (9,419,104)Foreign exchange movements 1,694,951 378,429Balance at the beginning of the period 3,087,414 23,689,389

Balance at the end of the period 8,039,509 14,648,714


Unaudited condensed consolidated interim statemento cash fowsfor the six months ended 31 October 2010


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Notes to the unaudited condensed consolidatedinterim nancial statementsfor the six months ended 31 October 2010

1 General informationThe Company and its subsidiaries, including special purpose vehicles (SPVs) controlled by the Company(together the Group), were established to invest in a global portfolio of forestry-based properties which canbe managed on an environmentally and socially sustainable basis. Assets may be managed for timber production,environmental credit production or both. As at the interim date, the Group owned forestry assets located inAustralia, Brazil, Hawaii, New Zealand and the United States.

The Company is a closed-ended company with limited liability, incorporated in Jersey, Channel Islandson 19 January 2007. The address of its registered ofce is One the Esplanade, St Helier, Jersey JE4 8UW.

These nancial statements were approved and authorised for issue on 18 January 2011 and signed by DonaldAdamson and Martin Richardson on behalf of the Board.

The Company has its primary listing on AIM, a market of the London Stock Exchange, as well a dual listingon the Channel Islands Stock Exchange.

2 Basis of preparationThe unaudited condensed consolidated interim nancial information included in the half-year report for the sixmonths ended 31 October 2010 has been prepared in accordance with International Accounting Standard (IAS)34 Interim Financial Reporting. It does not include all of the information required for full annual nancialstatements. The half-year report should be read in conjunction with the Groups Annual Report and FinancialStatements for the year ended 30 April 2010, which have been prepared in accordance with InternationalFinancial Reporting Standards (IFRS). The extra column of comparatives for the half year ended 31 October 2009in the statement of nancial position is an AIM requirement and notes to these accounts are not required.

Except as described below, the accounting policies applied by the Group in these condensed interim consolidatednancial statements are the same as those applied by the Group in its consolidated nancial statements as at andfor the year ended 30 April 2010.

The condensed consolidated interim nancial statements have been prepared in Sterling, which is thepresentational currency of the Group and under the historical cost convention, except for investment property,plantations, buildings, intangible assets and certain nancial instruments, which are carried at fair value.

The preparation of the condensed consolidated interim nancial statements requires the Directors to makeestimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, andthe disclosure of contingent liabilities at the date of the condensed consolidated interim nancial statements.If, in the future, such estimates and assumptions, which are based on the Directors best judgement at the dateof the condensed consolidated interim nancial statements, deviate from actual circumstances, the originalestimates and assumptions will be modied as appropriate in the period in which the circumstances change.

In preparing these condensed consolidated interim nancial statements, the signicant judgements made bymanagement in applying the Groups accounting policies and the key sources of estimating uncertainty were thesame as those that applied to the consolidated nancial statements as at, and for the year ended, 30 April 2010.


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2 Basis of preparation continuedThe following signicant rates applied during the periods:

31 October 31 October 30 April 30 April2010 2010 2010 2010Closing rate Average rate Closing rate Average rate

Australian Dollar 1.6307 1.6958 1.6522 1.8494Brazilian Real 2.7282 2.6898 2.6567 2.9368Hungarian Forint 312.3450 332.0582 309.0236 308.4517New Zealand Dollar 2.0927 2.1358 2.1008 2.3272United States Dollar 1.6038 1.5304 1.5274 1.6015

New accounting policies effective and adoptedThe International Accounting Standards Boards (IASB) annual improvements project of 2008 amended anumber of existing standards with effect from 1 January 2009, none of which has had a material impact onthe Group.

At the date of authorisation of these nancial statements, the following Standards and Interpretations, whichhave not been applied in these nancial statements, were in issue but not yet effective:

IAS 24 (amended) Related Party Disclosures (effective for periods commencing on or after 1 January 2011);

IFRS 7 (amended) Financial Instruments: Disclosures (effective for periods commencing on or after 1 July 2011);

IFRS 9 Financial Instruments Classication and Measurement (effective for periods commencing on or after1 January 2013); and

IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments (effective for periods commencing on orafter 1 July 2010).

In addition the IASB completed its second and third annual improvements projects in April 2009 and May 2010,respectively. These projects amended a number of existing standards and interpretations effective for accountingperiods commencing between 1 July 2009 and 1 January 2011.

The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have nomaterial impact on the nancial statements of the Group except as follows:

IFRS 9 will introduce new requirements for classifying and measuring nancial assets.


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Notes to the unaudited condensed consolidatedinterim nancial statements continuedfor the six months ended 31 October 2010

3 Operating segmentsThe Board of Directors is charged with setting the Companys investment strategy in accordance with theProspectus. The Board of Directors is the Chief Operating Decision Maker (CODM). They have delegated theday to day implementation of this strategy to its Investment Manager but retain responsibility to ensure thatadequate resources of the Company are directed in accordance with their decisions. The investment decisionsof the Investment Manager are reviewed on a regular basis to ensure compliance with the policies and legalresponsibilities of the Board. The Investment Manager has been given full authority to act on behalf of theCompany, including the authority to purchase and sell timberland and other investments on behalf of theCompany and to carry out other actions as appropriate to give effect thereto. Whilst the Investment Managermay make the investment decisions on a day to day basis regarding the allocation of funds to differentinvestments, any changes to the investment strategy or major allocation decisions have to be approved by theBoard, even though they may be proposed by the Investment Manager.

The Board therefore retains full responsibility as to the major allocation decisions made on an ongoing basis.

The Investment Manager will always act under the terms of the Prospectus which cannot be radically changed

without the approval of the Board of Directors and shareholders. Details of the investment restrictions are setout in part 3 of the Admission Document and the Investment Strategy, available on www.cambiumfunds.com.

The Group operates in ve distinctly separate geographical locations, with timberlands located in New South Wales(Australia), the southern United States, Hawaii, New Zealand and Brazil.

New NorthJersey Zealand Australia America Hawaii Brazil Total

31 October 2010

Total assets 7,074,194 3,770,683 7,539,573 46,481,992 8,964,768 27,889,661 101,720,871

Total liabilities 143,390 333,098 963,360 14,012,757 882,956 1,956,068 18,291,629

New North

Jersey Zealand Australia America Hawaii Brazil Total30 April 2010

Total assets 2,778,561 3,054,384 8,856,576 48,107,940 10,529,042 27,176,625 100,503,128

Total liabilities 69,024 155,428 810,334 1,496,341 764,168 2,174,313 5,469,608

New NorthJersey Zealand Australia America Hawaii Brazil Total

31 October 2009

Segment revenue 1,171 695,139 73,459 769,769

Segment gross prot 1,171 105,926 73,459 180,556

Increase/(decrease)in fair value ofinvestment propertyand plantations 655,479 (466,588) (1,570,889) (1,110,790) (48,357) (2,541,145)

Forestry expenses 26,764 220,461 434,148 184,195 707,877 1,573,445


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3 Operating segments continued

New North

Jersey Zealand Australia America Hawaii Brazil Total31 October 2009

Segment revenue 1,026 95,685 426,814 46,310 569,835

Segment gross prot 1,026 95,685 125,783 46,310 268,804

Increase/(decrease)in fair value ofinvestment propertyand plantations 162,781 (148,752) (2,295,387) 45,668 1,980,809 (254,881)

Forestry expenses 24,168 120,430 379,207 172,246 575,320 1,271,371

The Group owns ten distinct parcels of land across ve main investment strategies.The Group owns approximately 16,445 acres in Ashford, New South Wales, Australia. This land was previouslybeing used for cattle grazing and is now being planted with high-value commercial and non-commercial specieswith a view to longer term revenue from plantations and exposure to potential environmental markets.

The second strategy consists of buying established plantations in the southern United States. Establishedplantations with a balanced age class distribution are suitable for long and short-term sustainable yield.Marketable products include sawtimber and pulp, which can be sold into healthy forest product markets thatexist in this geography. These properties also generate revenue from hunting leases and non-strategic land sales.After a land sale completed during the period since the reporting date, the Group owns 7,270 acres of landin Texas and another 29,122 acres of land spread across Florida and Georgia dedicated to this strategy.

The third investment strategy involves the development of fast-growth eucalyptus plantations to serve either

export log markets in Asia or developing markets in Hawaii. The Group has a leasehold interest in two plantationson the Big Island of Hawaii dedicated to this strategy. Pahala consists of 3,700 acres and Pinnacle is approximatelyanother 4,500 acres of maturing eucalyptus trees.

The Group has a fourth investment strategy of converting bare land to eucalyptus plantation for conversion tocharcoal to serve pig iron markets or for emerging pulp and paper markets in Brazil. The Group owns oneproperty in Tocantins, Brazil of approximately 25,700 acres and three properties in Minas Gerias, Brazil totalling29,377 acres dedicated to this strategy. It is anticipated that the eucalyptus will be grown on a rotation lengthof seven years.

The Group also owns 3,200 acres located in New Zealand. It consists predominately of mid-rotation radiata pineplantation established in the mid 1990s with a small component of Douglas Fir and Cypress. During the periodcovered by these reports the property was contracted to be sold and the transaction is expected to complete in

the next reporting period.


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4 Revenue

31 October 31 October

2010 2009

Sales harvested timber and stumpage 677,123 389,480Sales right of way 11,197Lease income 92,646 90,004Grant income 79,154

769,769 569,835

The grant income was received from Border Rivers-Gwydir Catchment Management Authority (an AustralianGovernment Authority) on signature of a Property Vegetation Plan (PVP) in connection with the Tarrangowerproperty. The PVP covers conservation management, regeneration of the area, natural revegetation and

plantation and allows for income receipts of up to a total of AU$960,000 (approximately 524,990) oncertication of certain milestones having been achieved by the landholder. The PVP is for a term of 15 yearsand is governed by the laws of New South Wales.

5 Administrative expenses


Investment Managers fees 472,344 513,896Directors fees 57,500 57,500Auditors fees 29,248 31,500

Other professional fees and costs 173,440 176,386Costs to sell intangible asset 1,493 Administration of subsidiaries 109,986 246,672

844,011 1,025,954

Administration of subsidiaries includes statutory fees, accounting fees and administrative expenses in regards toasset holding subsidiaries.

The Manager receives an annual management fee of 1% of the NAV of the Company, payable quarterlyin advance. In addition, the Manager shall be entitled to a performance fee in certain circumstances.The performance hurdle is 100 pence per ordinary share increased at a rate of 8% per annum (compound).If the performance hurdle is met, the performance fee payable will be an amount equal to 20% of the excessamount between the NAV and the performance hurdle.


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6 Finance income

31 October 31 October

2010 2009

Bank interest 20,522 27,109

The classication of nance income per nancial asset class is listed in notes 7 and 8.

7 Finance costs


Bank interest 3,230 2,779

Loan interest 335,823 339,053 2,779

8 Net gains and losses on nancial assets and liabilities at fair value through prot and loss


Net change in unrealised appreciation on nancial assetsheld at fair value through prot or loss:Options 1,377,588 297,444Forward currency exchange contracts 2,968,739

1,377,588 3,266,183

9 Dividend

Dividendper share Paid

Dividend reference period Shares Date

2008 104,350,000 0.03 3,130,500 24/09/20082009 104,350,000 0.03 3,130,500 30/09/20092010 104,130,000 0.03 3,123,900 20/10/2010


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10 Basic and diluted (loss)/earnings per shareThe calculation of the basic and diluted earnings per share is based on the following data:


(Loss)/prot for the purposes of basic and diluted earnings per sharebeing net (loss)/prot for the period (6,387,955) 440,603

Number of ordinary sharesNumber of ordinary shares for basic and diluted earnings per share:


Weighted average number of ordinary shares for the purposes

of basic and diluted earnings per share 104,130,000 104,130,000Basic and diluted (loss)/earnings per share (6.13) pence 0.42 pence

11 Net asset value


Total assets 101,720,871 100,503,128Total liabilities 18,291,629 5,469,608

Net asset value 83,429,242 95,033,520

Number of shares in issue 104,130,000 104,130,000Net asset value per share 0.80 0.91

12 Investment property and plantations

Pre-Merchantable merchantable Total

timber timber plantations Land Total31 October 2010

Fair value opening balanceof plantations at 1 May 2010 21,833,426 15,039,906 36,873,332 58,062,195 94,935,527Costs capitalised 1,510,081 1,510,081 3,549 1,513,630

Harvested timber (589,227) (589,227) (589,227)Transfer to merchantable timber 2,933,475 (2,933,475) Disposal of plantation and land (47,944) (47,944) (806,244) (854,188)

24,177,674 13,568,568 37,746,242 57,259,500 95,005,742

Fair value adjustments on pricegains/(losses) on land and plantation 815,161 61,193 876,354 (1,582,154) (705,800)Fair value adjustments on growthgains on land and plantation 516,917 516,917 516,917Fire, hazardous weather and otherdamages (impairment) (2,352,262) (2,352,262) (2,352,262)

(Decrease)/increase in fair value ofinvestment property and plantations (1,020,184) 61,193 (958,991) (1,582,154) (2,541,145)Foreign exchange effect (1,100,649) (331,188) (1,431,837) (1,778,522) (3,210,359)

Fair value as at 31 October 2010 22,056,841 13,298,573 35,355,414 53,898,824 89,254,238


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12 Investment property and plantations continued

Pre-

Merchantable merchantable Totaltimber timber plantations Land Total30 April 2010

Fair value opening balance ofplantations at 1 May 2009 14,246,698 16,708,863 30,955,561 50,472,805 81,428,366Land acquired in the year 1,052,801 1,052,801Plantations acquired in the year 1,466,089 1,466,089 1,466,089Acquisition costs capitalised 578 2,534,677 2,535,255 5,803,643 8,338,898Harvested timber (777,912) (777,912) (777,912)Transfer to merchantable timber 7,580,089 (7,580,089)

21,049,453 13,129,540 34,178,993 57,329,249 91,508,242

Fair value adjustments on pricegains/(losses) on land and plantation 870,227 1,900,076 2,770,303 (2,507,486) 262,817Fair value adjustments on growthgains on land and plantation 690,181 690,181 690,181Fire, hazardous weather and otherdamages (impairment) (663,531) (663,531) (663,531)

Increase/(decrease) in fair value ofinvestment property and plantations 896,877 1,900,076 2,796,953 (2,507,486) 289,467Foreign exchange effect (112,904) 10,290 (102,614) 3,240,432 3,137,818

Fair value as at 30 April 2010 21,833,426 15,039,906 36,873,332 58,062,195 94,935,527

No harvested timber was held at the end of the period (30 April 2010: nil).

The land and plantations are carried at their fair value as at 31 October 2010 and 30 April 2010, as measured byexternal independent valuers American Forest Management Inc., James W. Sewall Company, Pyry Forest Industry,URS New Zealand Limited, Holtz Consultoria LTDA, and Sandro Al-Alam Elias. Each of the valuers uses similarmethodologies, though this can vary depending on the type of investment and local practices.

The appraisals for the Corrigan and South Atlantic States properties in the United States were undertakenby American Forest Management Inc. and James W. Sewall Company, respectively. These appraisals conform toUniform Standards of Professional Appraisal Practice in the United States. For these valuations, three valuationapproaches were considered: the cost approach; the sales comparison approach; and the income approach.Each approach selected as being applicable and necessary to produce credible results is believed to have been

applied appropriately.The properties in Hawaii, Pahala and Pinnacle, are leasehold interests without any ownership of theunderlying land. These investments were valued by James W. Sewall Company in accordance with IFRS.For these valuations the sales comparison approach and the income capitalisation approach were considered.Each approach selected as being applicable and necessary to produce credible results is believed to have beenapplied appropriately.

Pyry Forest Industry valued the Tarrangower investment in Australia consistent with the local equivalent of IFRS.There is little comparable transaction evidence to determine the value of land for forestry purposes in the region.Therefore, Pyry has applied a combination of the cost approach and the income approach to value the assets.


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12 Investment property and plantations continuedThe 3R Tocantins property in Brazil was valued by Holtz Consultoria LTDA. The method applied for the bare landappraisal was the sales comparison approach. The analysis considered the bare land price from comparabletransactions, soil quality, topography of the land, access and distance from cities and the proportion of theproperty which could be used for cultivation. The method applied for valuing the young tree crop is based on thestandard costs approach.

The three properties in Minas Gerias were valued by Sandro Al-Alam Elias by rst determining the highest andbest use of the subject property. This analysis helps the appraiser identify comparable properties and identify theuse that would produce the maximum income to the property. After determining the best use of the subjectproperty, the appraiser analysed the value of the property using the cost approach, the sales comparisonapproach and the income capitalisation approach.

The asset in New Zealand is being held at the value at which it has been contracted to be sold.

The discount rates used in these appraisals range in value from 6.25% to 10%.

13 Sale of land and plantations

Corrigan Tarrangower Total

Proceeds from sale 307,043 712,705 1,019,748Fair value as at 30 April 2010 (199,925) (654,263) (854,188)Cost to sell (6,888) (25,829) (32,717)

Prot 100,230 32,613 132,843

14 Buildings, plant and equipment

Furniture Motor

and ttings Buildings Improvements vehicles Total31 October 2010

Cost 2,141 355,284 62,341 16,468 436,234

Accumulated depreciation (198) (4,792) (4,990)

Balance as at 30 April 2010 1,943 355,284 62,341 11,676 431,244

Movements

Disposals (247,081) (45,996) (293,077)Depreciation for the period (168) (716) (884)Foreign exchange effect (49) (5,180) (1,014) 125 (6,118)

(217) (252,261) (47,010) (591) (300,079)

Carrying value

Balance as at 31 October 2010 1,726 103,023 15,331 11,085 131,165


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14 Buildings, plant and equipment continued

Furniture Motor

and ttings Buildings Improvements vehicles Total30 April 2010

Cost 707 358,138 130,602 13,349 502,796Accumulated depreciation (36) (2,533) (2,569)

Balance as at 30 April 2009 671 358,138 130,602 10,816 500,227

Movements

Assets acquired in year 1,157 1,157Reclassication to land (70,775) (70,775)Disposals (1,081) (15,140) (16,221)Revaluation (76,241) (2,334) (78,575)

Depreciation for the year (139) (1,490) (1,629)Foreign exchange effect 254 74,468 19,989 2,350 97,061

1,272 (2,854) (68,260) 860 (68,982)

Carrying value

Balance as at 30 April 2010 1,943 355,284 62,342 11,676 431,245

The buildings and improvements are carried at their fair value as at 31 October 2010 and 30 April 2010,as measured by external independent valuers Pyry Forest Industry at 31 October 2010 and 30 April 2010(in conjunction with the external valuation of plantations). The valuations have been prepared using techniquesapproved under IFRS. The motor vehicles and furniture and ttings are carried at cost less accumulated depreciation.

No impairment was recognised on buildings and improvements as the carrying value was the same as the valuations.

15 Sale of xed assets

Buildings Improvements Total

Proceeds from sale 269,151 50,105 319,256Fair value as at 30 April 2010 (247,081) (45,996) (293,077)Cost to sell (6,814) (1,268) (8,082)

Prot 15,256 2,841 18,097


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16 Intangible assets

31 October 30 April

2010 2010

Valuation water licence as at 30 April 2010 162,511 122,650Revaluation 10,003Disposal (141,934) Foreign exchange effect (20,577) 29,858

162,511

17 Sale of intangible assets

Total

Proceeds from sale 58,969Fair value as at 30 April 2010 (141,934)Cost to sell (1,493)Loss to revaluation reserve 54,885Loss to deferred tax 29,573

Loss

The Tarrangower property has approximately 4 kilometres of frontage to the Severn River and has attached toit a water licence administered by the Department of Natural Resources in Australia (DNR). The 105 mega litresurface irrigation licence (Number 90SL100620) has rights attached to it allowing an annual allocation of48 mega litres A class and 57 mega litres B class from Pindari Dam, which is located 11 kilometres furtherupstream. The licence is renewable on a ve year basis and at a small administration cost to the Group.

In the period to 31 October 2010 this water licence was disposed of along with the property it related to.

18 Trade and other receivables

31 October 30 April2010 2010

Currency option receivable MF Global 313,291Goods and services tax receivable 57,728 44,343Other debtors 30,003

Prepaid expenses 50,924 45,940Trade receivables 24,350 155,887

163,005 559,461


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19 Bank borrowings

31 October 30 April

2010 2010

Metropolitan Life Insurance Company 12,173,263

The loan is secured on approximately 50,975 acres of timber and timberland assets located in multiple tracts inthe states of Texas, Florida and Georgia. The fair value of these assets at the period end was 42,797,536.

The loan term is for ten years. The interest rate is xed at 5.75% over the life of the loan. The loan has atermination date of 15 October 2020.

20 Financial assets and liabilities held at fair value through prot and loss

31 October 30 April2010 2010

Forward foreign currency contracts:at forward rate 313,292at market rate 11

Gain 313,303

Currency options:premium paid 2,751,249 1,062,282gain 1,377,588 (80,646)

Fair value 4,128,837 981,636

Total nancial assets held at fair value through prot and loss 4,128,837 1,294,939

The above gains on options represent the total net unrealised gain.

Forward exchange currency contracts and options are used to hedge against foreign exchange exposure arisingfrom investing in foreign operations and foreign currency transactions. The Group incurred an unrealised gainof 1,377,588 on the foreign exchange options. It is not the policy of the Group to perform hedge accountingunder the terms of IAS 39 and therefore the effect of changes in exchange rates for foreign operations isrecognised directly in comprehensive income. The loss on exchange differences recognised directly in othercomprehensive income for the period amounted to 952,036.

As at 31 October 2010 there were six options to trade currency in place; three are held with MF Global(United Kingdom) Limited and three with Morgan Stanley.

Forward exchange currency contracts held by the Group at their forward exchange rates are listed below:

31 October 31 October 30 April 30 April2010 2010 2010 2010US$ US$

Forward exchange currency contractsto sell United States dollar 40,477,770 26,856,092

US$ US$

Forward exchange currency contractsbuy Pounds Sterling 26,542,800 40,477,770


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21 Foreign exchange effectComparison of movement in translation reserve and hedging loss:

Beginning Ending Translation Hedging Differenceperiod spot period spot reserve prot/(loss) prot/(loss)

Australian Dollar 1.6522 1.6307 87,310 (312,996) (225,686)Brazilian Real 2.6567 2.7282 (699,221) (780,253) (1,479,474)New Zealand Dollar 2.1008 2.0927 19,573 (111,540) (91,967)United States Dollar 1.5274 1.6038 (1,445,200) 252,753 (1,192,447)

(2,037,538) (952,036) (2,989,574)

22 Cash and cash equivalents

31 October 30 April

2010 2010

Cash held at bank 7,585,825 3,017,328Cash held at broker 453,684 70,086

8,039,509 3,087,414

Cash at broker is held with MF Global (United Kingdom) Limited and an amount of 453,684 (30 April 2010: 70,086)is held as security.

23 Trade and other payables

31 October 30 April

2010 2010

Accruals 219,997 116,502Trade creditors 576,340 785,947Tax payable 3,714 Retentions held* 353,830 363,353Advances held 782,120 118,636

1,936,001 1,384,438

* The Companys Brazilian subsidiary, 3R Tocantins Florestais Ltda., retained approximately 6% of the purchaseprice of the 3R Tocantins property for a period of ve years, to support any liability associated with the

previous ownership.Advances held comprise timber sale proceeds received in advance.


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24 Net asset value reconciliation

NAV 30 April 2010 95,033,520

Translation foreign exchange differences (2,037,538)Prot on revaluation of property and plantation (2,541,145)Prot on sale of plantations 132,843Finance costs (339,053)Evaluation reserve movement intangible sale (54,885)Loss on currency options (952,036)Net foreign exchange loss (223,323)Loss before revaluation of property and plantation (2,465,241)Dividend paid (3,123,900)

NAV 31 October 2010 83,429,242

25 Stated capital30 October 30 April

2010 2010

Balance as at period end 2,000,000 2,000,000

The total authorised share capital of the Company is 250 million ordinary shares of no par value with 104,350,000 sharesissued at 100 pence each on initial placement. Ordinary shares carry no automatic rights to xed income but theCompany may declare dividends from time to time to which ordinary shareholders are entitled. Each share isentitled to one vote at meetings of the Company.

On 22 February 2007 a special resolution was passed by the Company to reduce the stated capital accountfrom 104,350,000 to 2,000,000. Approval was sought from the Royal Court of Jersey and was grantedon 29 June 2007. The balance of 102,350,000 was transferred to a distributable reserve on that date.

The Company, pursuant to its authority granted by shareholders on 15 August 2008 to make market purchasesof its own shares, on 4 September 2009 purchased 220,000 ordinary shares for cancellation at a price of 72 penceper share. The total amount was 158,400. This distributable reserve was utilised to make the share buy-back.The Company renewed authority granted by shareholders of the Company to make market purchases of its ownshares on 4 October 2010.

26 ReservesThe movements in the reserves for the Group are shown on page 8.

Distributable reserve

The Company reduced its stated capital account and a balance of 102,350,000 was transferred todistributable reserves. This reserve can be applied if the entity wishes to purchase its own shares and forthe payment of dividends.

Translation reserveThe translation reserve contains exchange differences arising on consolidation of the Groups foreign operations.

Revaluation reserveThe revaluation reserve arises from the revaluation of available-for-sale investments, intangible assets andbuildings, plant and equipment.


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27 Capital risk managementThe Groups objectives when managing capital are to safeguard the Groups ability to continue as a goingconcern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce thecost of capital.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paidto shareholders, return capital to shareholders, issue new shares or sell net assets to reduce debt.

In order to ensure that the Group will be able to continue as a going concern, management continually monitorsforecast and actual cash ows and attempts to match the maturity proles of assets and liabilities.

28 Contingent liabilityThere is a security interest on the 3R Tocantins property to cover a liability, amounting to BRL 5,781,038(approximately 2,118,993), between the previous owners and Banco da Amazonia, a nancial institution whichlent money to the previous owners who used the property as collateral. 3R Tocantins Florestais Ltda. holdsa security interest of superior value on another property of the previous owner to cover this potential liability

in the event it materialises. The last valuation on the security interest property amounted to BRL 6,942,578(2,393,167). The security interest the Company holds will only be released after Banco da Amazonia releasesthe security interest on the 3R Tocantins property.

29 Related party transactionsParties are considered to be related if one party has the ability to control the other party or exercise signicantinuence over the other party in making nancial or operational decisions. CP Cogent Asset Management LP isthe Investment Manager to the Company under the terms of the Investment Management Agreement and is thusconsidered a related party of the Company.

During the period, 472,344 (2009: 513,896) was paid to CP Cogent Asset Management LP in respect ofmanagement fees.

Colin McGrady is a director of CP Cogent Asset Management LP, which acts as Investment Manager. He is alsoa Director of the Company and has waived his Directors fees for the period.

The Directors of the Company received total fees as follows:


Donald Adamson (Chairman) 20,000 20,000Martin Richardson 12,500 12,500Robert Rickman 12,500 12,500William Spitz 12,500 12,500Colin McGrady

57,500 57,500

30 Events after the reporting periodAfter the period end the Group completed the land sale of 14,273 acres of land located around Corrigan, Texas.Net of sales commissions and other transaction costs proceeds were approximately $18,100,000 equating to97% of NAV from the year end appraisal cycle at 30 April 2010 and 111% of the Groups current cost basis.Additionally, the 3,200 acre asset in New Zealand was contracted to sell at 118% of the 30 April 2010 NAV.The assets in New Zealand represent 4.1% of the NAV.

Around $5,300,000 of the proceeds was used to pay down principal on the amount borrowed by the Group.The remaining amounts will be reinvested in expected higher return projects including the Groups forestationprojects in Brazil.


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DirectorsDonald Adamson (Chairman)Robert RickmanWilliam SpitzMartin RichardsonColin McGrady

Registrar, Paying Agentand Transfer AgentCapita Registrars(Jersey) LimitedPO Box 378Jersey JE4 0FF

Nominated Adviser for AIM

PwCPlumtree CourtLondon EC4A 4HTUnited Kingdom

Investment ManagerCP Cogent AssetManagement LP2101 Cedar Springs RoadSuite 1200Dallas, TX 75201United States

AuditorsKPMG Channel Islands Limited5 St Andrews PlaceCharing CrossSt HelierJersey JE4 8WQ

Property ValuersAmerican ForestManagement Inc.Forest Resource ConsultantsPO Box 1919407 North Pike Road EastNorth Pike Road EastSumter, SC 29151United States

James W. Sewall Company136 Centre StreetPO Box 433Old Town, ME 04468United States

Holtz Consultoria LTDAAvenida Repblica Argentina 452Cj. 1506gua VerdeCEP 80240-210CuritibaBrazil

Pyry Forest IndustryLevel 5, HSBC House1 Queen StreetPO Box 105891Auckland CityNew ZealandURS New Zealand Limited1315 College HillPO Box 821Auckland 1140New Zealand

Sandro Al-Alam EliasSafras & CifrasRua Santos Dumont 621Pelotas RSCEP 96020-380

Brazil

Registered Ofceof the CompanyOne the EsplanadeSt HelierJersey JE4 8UWTelephone +44 (0)1534 512512

Sponsor to CISX Listingand Legal AdviserCarey Olsen CorporateFinance Limited44 EsplanadeSt HelierJersey JE1 0BD

Corporate BrokerMatrix Corporate Capital LLPOne Vine StreetLondon W1J 0AHUnited Kingdom

Administrator andCompany SecretaryInvestec Trust(Jersey) LimitedOne the EsplanadeSt Helier

Jersey JE4 8UWSub AdministratorPraxis Property FundServices LimitedPO Box 296Sarnia HouseSt Peter PortGuernsey GY1 4NA

Key parties


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One the Esplanade

Documents

Interim Report - 19 January 2011