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New World Oil And Gas Regulatory News (NEW)



Regulatory News for New World Oil And Gas (NEW)


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Final Results

Thu, 31st Mar 2016 07:00

RNS Number : 6261T
New World Oil & Gas
31 March 2016
 

New World Oil and Gas Plc / Index: AIM / Epic: NEW / Sector: Oil & Gas

31 March 2016

New World Oil and Gas Plc ('New World' or the 'Company')

Final Results

 

New World Oil and Gas Plc, announces its final audited results for the year ended 31 December 2015.  The audited accounts are available on the Company's website: www.nwoilgas.com, and extracts are set out below.

 

Chairman's Statement

Sustained volatility in global oil and gas markets dominated the year under review.  Prices have since fallen to levels not seen for the best part of a decade.  Low prices are clearly not good news for the oil and gas industry, particularly for those companies looking to raise funds for exploration or development.  I am pleased to report that thanks to the steps we have taken during the period, New World stands out from the crowd, for the right reasons: we have a strong balance sheet a healthy cash balance and no licence commitments. As a result, the Company is well placed to review a number of opportunities to secure its long-term future.

 

We recognised early on that oil prices were set to stay 'lower for longer'. We therefore took the decision to conserve the Company's cash balances to ensure we are able to move quickly on opportunities that meet our investment criteria from a position of strength.  As a result, cash conservation has been the focus of the year.  This goes beyond merely maintaining a strict control on costs.  We have also undertaken a rationalisation of our portfolio of projects to ensure that there are no licence commitments that would act as a draw on our cash balances in the short term.  We took the decision to relinquish the Danica Jutland 1/09 and 2/09 and Danica Resources 1/08 licences onshore Denmark in September 2015.  New World had progressed these licences to the point where, despite identifying good resource potential, we were only prepared to invest in further exploration alongside a partner.  It became increasingly clear that, with markets where they were and continue to be today, the appetite among suitable partners has diminished.

 

Following our exit from Denmark, New World's licence in Belize remains in force, unless extended, until 31 October 2016 and we continue actively to manage our interests and obligations and to seek partners whilst incurring only minimal administrative expenses.  However we consider it prudent to make a full provision in the accounts against the carrying value of this asset as the outcome cannot be determined with certainty.

 

In tandem with managing our cash balance, we have also been working hard to pursue monies owed to New World.  We have commenced the legal process to recover the outstanding loans in respect of the Al Maraam transaction.  In addition, we were pleased to announce in December 2015 that the loans made to director Georges Sztyk and former director Peter Sztyk through Dynamic Investments Limited have now been re-paid in full including interest charged at 3% per annum. The loan to William Kelleher, the former CEO and Chairman of New World, remains outstanding and we continue to review options on how to recover monies due.

 

At the strategic level, the volatile market conditions triggered a debate over the future direction of the Company and prompted a number of changes to the Board. Nicholas Lee and Adam Reynolds, two highly experienced executives with proven track records in successfully developing and implementing new strategies for a wide range of companies, were appointed directors.  Nicholas and Adam replace Fred Hodder, who stood down as a non-executive Director at the Company's AGM, and Peter Sztyk, who chose to not to be re-elected to the Board following his retirement by rotation.  Peter and Fred were instrumental in ensuring New World remained financially sound during these uncertain times and I would like to thank them both for the important contribution they made to the Company.

 

Financial Review

 

For the period under review, due to the explorative nature of the Company combined with depressed global oil prices and the prudent approach adopted to the carrying value of its intangible assets, the Company is reporting a loss of US$4.2 million (vs loss of US$11.7 million in 2014).  This loss has been arrived at after charging impairment provisions of intangible assets of US$2.2 million, administrative expenses of US$1.5 million and legal and professional costs of US$0.5 million.  Included in the 2015 results are US$0.1 million of expenses related to the unsuccessful placing proposed in May 2015 and US$0.1 million of legal and professional fees for dealing with shareholder groups.

 

With the successful completion of a Placing and Open Offer in Q3 2015, the Company raised US$5.4 million through the issue of 3.9 billion shares.  Net of fundraising expenses of US$1.2 million, the Company recognised net proceeds of US$4.3 million.  The current cash position of the Company excluding any funds owed to the Company pursuant to the Al Maraam SPA and the outstanding Director loan, stands at approximately US$3.2 million. 

 

Corporate Review

 

Along with the previously mentioned changes to the Board, the Directors have continued and intensified cost controls through salary reductions and limiting third party expenditure. Cornhill Capital Limited was appointed Broker to the Company, and conducted a successful Open Offer and Placing. As a result, the Company now has sufficient funding to take advantage of potential market opportunities.

 

Outlook

Whilst oil prices appear to be bottoming out, we do not see the oil and gas industry recovering sufficiently in the near future to generate enthusiasm in capital markets to fund new ventures.  We intend to maintain a tight control on costs and manage overheads to a minimum whilst exploring all options available to the Company.  We believe that we will be  able to secure an attractive value accretive option to deliver shareholder value and a long-term future for New World and we plan to provide further updates in due course.

 

Christopher Einchcomb

Acting Non-executive Chairman

31 March 2016

 

Operations Report

 

The Blue Creek PSA termination date was successfully extended to 31 October 2016. The Group is actively looking for a farm-in partner for the Blue Creek PSA to reduce future costs and help de-risk the project. Discussions with potential interested parties continue.

 

During the past year, the Danish licences were relinquished as the Company was unable to locate a farm-in partner to assume financial responsibility for a possible drilling programme. All contract obligations have been fulfilled and as such we have received formal notification from the Danish Energy Agency that no outstanding obligations remain.  The Company will finalise its relationships with its partner, the North Sea Fund, in due course.

 

Georges Sztyk

Executive Director

31 March 2016

 

 

 Enquiries:



Georges Sztyk

New World Oil and Gas Plc

Tel: +1 646 407 9946

Roland Cornish

Beaumont Cornish Limited

Tel: +44 (0) 20 7628 3396

Felicity Geidt

Beaumont Cornish Limited

Tel: +44 (0) 20 7628 3396

Nicholas Bealer

Cornhill Capital Limited (Broker)

Tel: +44 (0) 20 7710 9612

Andrew Frangos

Cornhill Capital Limited (Broker)

Tel: +44 (0) 20 7710 9611

Lottie Brocklehurst

St Brides Partners Ltd

Tel: +44 (0) 20 7236 1177

Frank Buhagiar

St Brides Partners Ltd

Tel: +44 (0) 20 7236 1177

 

 

 

 

Definitions

 

"Al Maraam SPA"

the share purchase agreement entered into between the Company and Shareholders of Al Maraam Al-Ahliya Company for General Contracting WLL dated 10 May 2014

"Al Maraam"

Al Maraam Al-Ahliya Company for General Contracting WLL

"Blue Creek FOA"

the farm out agreement dated 15 June 2011 (as amended) between BCE and NWOG Belize

"Blue Creek Project"

means the Blue Creek project, being the acreage covered by the Blue Creek PSA

"Blue Creek PSA"

the production sharing agreement dated 12 October 2007 (as

amended) between the Government of Belize and BCE

"NWOG Belize"

 

New World Oil and Gas (Belize) Limited, a wholly owned

subsidiary of the Company, incorporated in Belize

"NWOG Belize Operations"

New World Oil and Gas (Belize Operations) Limited, a wholly

owned subsidiary of the Company, incorporated in Belize

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL STATEMENTS

 

Group Statement of Comprehensive Income for the year ended 31 December 2015

 






Notes


2015


2014








$000's


$000's











Revenue







-


-











Impairment of intangible assets



(2,172)


(10,500)

Administrative expenses




(1,528)


(2,665)

Legal and professional costs




(530)


(336)








________


________











Loss from operations



3


(4,230)


(13,501)

Interest receivable



6


10


24

Provision for losses on financial instrument



-


(171)

Gain on contract settlement



-


1,939








________


________

Loss before taxation





(4,220)


(11,709)








________


________











Income tax




7


-


-








________


________

Loss for the year





(4,220)


(11,709)








=======


=======











Other comprehensive income



-


-








________


________

Total comprehensive loss for the year attributable to equity holders of the parent



 

(4,220)


 

(11,709)








________


________











Loss per share (cents)







Basic





8


(0.16)


(1.67)








________


________











Diluted





8


(0.16)


(1.67)








________


________

 

 

 

Group Statement of Financial Position as at 31 December 2015

 






Notes


2015


2014








$000's


$000's











Assets




















Non-current assets








Tangible assets

9


-


14

Intangible assets


10


-


2,112








________


________

Total non-current assets




-


2,126









Current assets








Inventories

11


-


50

Trade and other receivables


12


-


517

Cash and cash equivalents





3,642


1,144








________


________

Total current assets





3,642


1,711







________


________

Total assets






3,642


3,837






________


________











Liabilities















Current liabilities








Trade and other payables

13


(739)


(1,025)








________


________

Total liabilities





(739)


(1,025)






________


________

Net assets






2,903


2,812








=======


=======











Equity










Share capital




14


-


-

Share premium






52,232


47,369

Share-based payment reserve



368


920

Retained loss





(49,697)


(45,477)




________


________







2,903


2,812




=======


=======

 

The financial statements were approved by the board of directors and authorised for issue on 31 March 2016.  They were signed on its behalf by

 

 

 

Georges Sztyk                                                                                       Adam Reynolds

Director                                                                                                  Director 

 

 

Company Statement of Financial Position as at 31 December 2015

 






Notes


2015


2014








$000's


$000's











Assets




















Non-current assets








Tangible assets

9


-


14

Investment in subsidiaries


17


26


26

Amounts due from subsidiaries


12


-


2,003






________


________

Total non-current assets





26


2,043







Current assets







Trade and other receivables



12


-


517

Cash and cash equivalents




3,618


1,089






________


________

Total current assets





3,618


1,606







________


________

Total assets





3,644


3,649











Liabilities















Current liabilities








Trade and other payables

13


(715)


(832)








________


________

Total liabilities





(715)


(832)






________


________

Net assets






2,929


2,817








=======


=======











Equity










Share capital




14


-


-

Share premium






52,232


47,369

Share-based payment reserve



368


920

Retained loss





(49,671)


(45,472)




________


________







2,929


2,817




=======


=======

 

The financial statements were approved by the board of directors and authorised for issue on 31 March 2016.  They were signed on its behalf by

 

 

Georges Sztyk                                                                                       Adam Reynolds

Director                                                                                                  Director

 

Group Statement of Cash Flows for the year ended 31 December 2015








2015


2014








$000's


$000's











Cash flows from operating activities
















Operating loss





(4,230)


(13,501)

Depreciation



14


15

Impairment of intangible assets




2,172


10,500

Gain on contract settlement




-


1,939

Decrease in receivables



517


796

(Decrease)/increase in payables




(286)


470

Decrease in inventories




50


40






________


________

Net cash (outflow)/inflow from operating activities


(1,763)


259





________


________









Returns on investments and servicing of finance













Interest received





10


24







________


________

Net cash inflow from returns on investments and servicing of finance



 

10


 

24








________


________










Cash flows from investing activities






Net proceeds from disposal of tangible assets


-


-

Payments to acquire intangible assets



(60)


(263)








________


________

Net cash outflow from investing activities



(60)


(263)






________


________










Cash flows from financing activities






Proceeds on issuing of ordinary shares



5,431


-

Cost of issue of ordinary shares



(1,120)


-

Net conversion of financial instrument


-


16




________


________

Net cash inflow from financing activities



4,311


16




________


________










Net increase in cash and cash equivalents


2,498


36







Cash and cash equivalents at beginning of year


1,144


1,108




________


________

Cash and cash equivalents at end of year



3,642


1,144




________


________

 

Company Statement of Cash Flows for the year ended 31 December 2015

 








2015


2014








$000's


$000's











Cash flows from operating activities
















Operating loss




(4,209)


(13,496)

Provision against amounts due from subsidiary



2,236


10,418

Depreciation




14


15

Gain on contract settlement




-


1,939

Decrease in receivables



517


789

(Decrease)/increase in payables




(117)


434





________


________

Net cash (outflow)/inflow from operating activities


(1,559)


99




________


________









Returns on investments and servicing of finance













Interest received





10


24







________


________

Net cash inflow from returns on investments and servicing of finance



 

10


 

24








________


________










Cash flows from investing activities






Advances to subsidiaries



(233)


(36)




________


________

Net cash outflow from investing activities



(233)


(36)




________


________










Cash flows from financing activities






Proceeds on issuing of ordinary shares



5,431


-

Cost of issue of ordinary shares



(1,120)


-

Net conversion of financial instrument


-


16




________


________

Net cash inflow from financing activities



4,311


16




________


________










Net increase in cash and cash equivalents


2,529


103







Cash and cash equivalents at beginning of year


1,089


986




________


________

Cash and cash equivalents at end of year



3,618


1,089




=======


=======

 

Group Statement of Changes in Equity for the year ended 31 December 2015

 






Share premium


Share-based payments reserve


Retained Losses


 

Total






$000's


$000's


$000's


$000's













Balance at 1 January 2014

47,369


920


(33,768)


14,521













Total comprehensive loss for the year

 

-


 

-


 

(11,709)


 

(11,709)



________


________


________


________

Balance at 31 December 2014

47,369


920


(45,477)


2,812


________


________


________


________

Balance at 1 January 2015

47,369


920


(45,477)


2,812








Share issue


5,431


-


-


5,431

Cost of share issue


(1,120)


-


-


(1,120)

Expiration of unexercised warrants

552


(552)


-


-









Total comprehensive loss for the year

 

-


 

-


 

(4,220)


 

(4,220)


________


________


________


________

Balance at 31 December 2015

52,232


368


(49,697)


2,903


________


________


________


________

 

Company Statement of Changes in Equity for the year ended 31 December 2015

 






Share premium


Share-based payments reserve


Retained Losses


 

Total






$000's


$000's


$000's


$000's













Balance at 1 January 2014

47,369


920


(33,768)


14,521













Total comprehensive loss for the year

 

-


 

-


 

(11,704)


 

(11,704)



________


________


________


________

Balance at 31 December 2014

47,369


920


(45,472)


2,817


________


________


________


________

Balance at 1 January 2015

47,369


920


(45,472)


2,817








Share issue


5,431


-


-


5,431

Cost of share issue


(1,120)


-


-


(1,120)

Expiration of unexercised warrants

552


(552)


-


-









Total comprehensive loss for the year

 

-


 

-


 

(4,199)


 

(4,199)


________


________


________


________

Balance at 31 December 2015

52,232


368


(49,671)


2,929


________


________


________


________

 

 

 

 

Notes to the financial statements for the year ended 31 December 2015

 

1              Summary of significant accounting policies

 

                General information and authorisation of financial statements

New World Oil & Gas Plc is a public limited company incorporated in Jersey.  The address of its registered office is Ogier House.  The Company's ordinary shares are traded on the AIM Market operating by the London Stock Exchange.  The Group financial statements of New World Oil and Gas Plc for the year ended 31 December 2015 were authorised for issue by the Board on 31 March 2016 and the statements of financial position signed on the Board's behalf by Georges Sztyk and Adam Reynolds.

 

Statement of compliance with IFRS

The Group's financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS).  The Company's financial statements have been prepared in accordance with IFRS as adopted by the European Union and as applied in accordance with the provisions of the Companies (Jersey) Law 1991.  The principal accounting policies adopted by the Group and Company are set out below.

 

Financial risk management

The Group's principal activity of oil and gas exploration is by nature unpredictable with inherent risk exposure.  In terms of general risk management the Board of Directors determine, as required, the degree to which it is appropriate to use financial instruments to mitigate risk.  Currently the Company's principal financial instruments comprise cash and equity capital.

 

The Company does not enter into complex derivatives to manage risk, however it entered into an equity swap arrangement in 2013.  The equity swap was settled in 2014 and a loss of $171,000 was recognized.  The Company had no financial instrument loss in 2015.

 

Foreign currency risk

Foreign exchange risk arises because the Group has operations located in various parts of the world whose functional currency is not US Dollars.  The Group's net assets are exposed to currency risk giving rise to gains or losses on retranslation into US Dollars.

 

Liquidity risk

The Company's policy throughout the year has been to ensure that it has adequate liquidity by careful management of its working capital.

 

Critical accounting estimates and judgements

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

 

The most critical estimations involve the impairment or otherwise of carrying values related to Exploration and Project Development expenses, which are performed for both the interim and annual financial statements.

 

 

New standards, amendments and interpretations adopted by the Company

No new and/or revised Standards and Interpretations have been required to be adopted, and/or are applicable in the current year by/to the Company, as standards, amendments and interpretations which are effective for the financial year beginning on 1 January 2015 are not material to the Company.

 

New standards, amendments and interpretations not yet adopted by the Company

At the date of authorisation of these financial statements, the following Standards and Interpretations which have not been applied in these financial statements, were in issue but not yet effective for the year presented:

 

IFRS 9 in respect of Financial Instruments which will be effective for the accounting periods beginning on or after 1 January 2018.

 

IFRS 14 in respect of Regulatory Deferral Accounts which will be effective for accounting periods beginning on or after 1 January 2016.

 

IFRS 15 in respect of Revenue from Contracts with Customers which will be effective for accounting periods beginning on or after 1 January 2017.

 

Amendments to IFRS 10, IFRS 12 and IAS 28 in respect of the application of the consolidation exemption to investment entities which will be effective for accounting periods beginning on or after 1 January 2016.

 

Amendments to IFRS 10 and IAS 28 in respect of the treatment of a Sale or Contribution of Assets between an Investor and its Associate or Joint Venture which will be effective for accounting periods beginning on or after 1 January 2016.

 

Amendments to IFRS 11 in respect of Accounting for Acquisitions of Interest in Joint Operations which will be effective for accounting periods beginning on or after 1 January 2016.

 

Amendments to IAS 1 in respect of determining what information to disclose in annual financial statements which will be effective for accounting periods beginning on or after 1 January 2016.

 

Amendments to IAS 16 and IAS 38 in respect of Clarification of Acceptable Methods of Depreciation and Amortisation which will be effective for accounting periods beginning on or after 1 January 2016.

 

Amendments to IAS 16 and IAS 41 in respect of Bearer Plants which will be effective for accounting periods beginning on or after 1 January 2016.

 

Amendments to IAS 27 to allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates which will be effective for accounting periods beginning 1 January 2016.

 

Annual improvements to IFRS's which will be effective for accounting periods beginning on or after 1 January 2016 as follows:

IFRS 5 - Changes in methods of disposal

IFRS 7 - Servicing contracts

IFRS 7 - Applicability of the amendments to IFRS 7 to condensed interim financial statements

IAS 19 - Discount rate: Regional market issue

IAS 34 - Disclosure of information "elsewhere in the interim financial report"

 

There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Company.

 

Basis of preparation

The consolidated financial statements have been prepared on the historical cost basis and on a going concern basis.

 

The financial report is presented in United States Dollars ($), which is the Group's functional and reporting currency, and all values are rounded to the nearest thousand dollars ($'000) unless otherwise stated.

 

Basis of consolidation

Where the Company has the power, either directly or indirectly, to govern the financial and operating policies of another entity or business so as to obtain benefits from its activities, it is classified as a subsidiary.  The consolidated financial statements present the results of the Company and its subsidiaries ("the Group") as if they formed a single entity.  Intercompany transactions and balances between Group companies are therefore eliminated in full.

 

Business combinations and goodwill

On acquisition, the assets and liabilities of a subsidiary are measured at their fair values at the date of acquisition.  Any excess of the cost of acquisition over the fair values of the identifiable net assets acquired is recognised as goodwill.

 

Revenue recognition

The Group has not yet commenced generating revenue.

 

Segment Reporting

Operating segments are reported in a manner consistent with internal reporting provided to the chief operating decision-maker who is responsible for allocated resources and assessing performance of the geographical segments.  The chief operating decision-maker has been identified as Christopher Einchcomb, Acting Non-Executive Chairman.

 

Foreign Currencies

Transactions in currencies other than US Dollars are recorded at the rates of exchange prevailing on the dates of the transactions.  At each balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the balance sheet date.  Gains and losses arising on retranslation are included in the income statement for the period.  On consolidation, the results of overseas operations are translated into US Dollars at rates approximating to those ruling when the transactions took place.  All assets and liabilities of the overseas operations are translated at the rate ruling at the balance sheet date.

 

Taxation

No charge to Jersey corporation tax arises on the results for the year due to the applicable zero tax rate.

 

The subsidiary companies have not generated any income therefore there are no tax consequences arising from Danish or Belize corporate income tax matters.

 

Tangible Fixed Assets

Tangible fixed assets comprise furniture and fixtures and plant and equipment and are depreciated on a straight line basis at annual rates that will reduce book values to estimated residual values over their estimated useful lines as follows:

                Furniture                                -               25% per annum

                Plant and Equipment           -               20% per annum

 

Intangible Fixed Assets

Exploration, evaluation and development expenditures incurred, together with appropriate overhead expenses such as project management and related travel, is accumulated in respect of each identifiable area of interest.

 

These costs are only carried forward to the extent that they are expected to be recouped through the successful development of the area or where activities in the area have not yet reached a stage which permits reasonable assessment of the existence of economically recoverable reserves of oil and/or gas.

 

Accumulated costs in relation to an abandoned area are written off in full in the year in which the decision to abandon is made.

 

Impairment of intangible assets

At each balance sheet date the Group reviews the carrying amounts of its intangible assets to determine whether there is any indication that those assets have suffered an impairment loss.  If there is such indication then an estimate of the asset's recoverable amount is performed and compared to the carrying amount.

 

Recoverable amount is the higher of fair value less costs to sell and value in use.  In assessing value in use, the estimated future cash flows are discounted to their present value.  Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

 

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount.  An impairment loss is recognised as an expense immediately, unless the relevant asset is carried at a re-valued amount, in which case the impairment loss is treated as a revaluation decrease.

 

Financial instruments

Financial assets and financial liabilities are recognised on the statement of financial position when the Group has become a party to the contractual provisions of the instrument.

 

Cash and cash equivalents

Cash and cash equivalents comprise cash in hand, cash at bank and short term deposits with banks and similar financial institutions.

 

Inventory

Inventories, representing drilling and related consumables, are stated at the lower of cost and net realisable value, cost being determined by the first-in first-out method.

 

Trade and other receivables

Trade and other receivables do not carry any interest and are stated at their nominal value as reduced by appropriate allowances for estimated irrecoverable amounts.

 

Trade and other payables

Trade and other payables are non-interest bearing and are stated at their nominal value.

 

Equity instruments

Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.

 

Share-based payments

The Group operated a Long Term Incentive Plan to allow certain Directors (being the Directors at the time of initial AIM admission) to be granted awards in respect of Ordinary Shares in the Company.  This plan lapsed in 2014 with no amount being due to any Director.  The Group also operates a Discretionary Annual Bonus Plan which may be paid in Ordinary Shares; however, this plan was suspended by the Directors in 2014.  As at 31 December 2015 no amounts have been provided or accrued in relation to the above schemes.

 

The fair value of Options granted to the Non-Executive Directors to subscribe for Ordinary Shares is recognised as an expense equal to the fair value of the services provided.

 

Additionally, the fair value of warrants to subscribe for Ordinary Shares as part of the fees under Placing arrangements and as part of the fees under the Re-Admission to AIM have been recognised as an expense or allocated to share issue costs as applicable.

 

The fair value of warrants and options granted is determined using the Black-Scholes valuation model.

 

Going Concern

The Group closely monitors and manages its liquidity risk, regularly preparing cash forecasts.  The Directors consider that the Group has adequate liquid resources to continue in operational existence for at least the 12 month period from the date of approval of these financial statements.

 

2              Turnover and segmental analysis

 

Segment information is presented in respect of the Group's management and internal reporting structure.  The Group had no revenue during the year.

 

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

 

Operating and Geographical segments

The Group comprises the following operating segments:

Corporate - Parent company administrative costs, general business development and AIM related costs. 

 

Exploration & development - costs in relation to the Group's direct oil and gas exploration operations.

 

2015

Business segments




Corporate


Exploration & development


Total

 














 









$000's


$000's


$000's

 










 

Result









 

Segment results




(1,963)


(2,257)


(4,220)

 





=======


=======


=======

 











 

Balance sheet










 

Segment assets





3,617


25


3,642

 

Segment liabilities





(715)


(24)


(739)

 





________


________


________

 

Net assets




2,902


1


2,903

 





=======


=======


=======

 










 

Geographical segments


Denmark


Belize


Jersey


Total

 



$000's


$000's


$000's


$000's

 










 

Result









 

Segment result


(623)


(1,634)


(1,963)


(4,220)

 



=======


=======


=======


=======

 









Balance sheet









 

Segment assets - Intangible

-


-


-


-

 

                           - Other 


12


13


3,617


3,642

 

Segment liabilities


(24)


-


(715)


(739)

 



________


________


________


________

 

Net assets


(12)


513


2,902


2,903

 



=======


=======


=======


=======

 

 

 

2014

Business segments




Corporate


Exploration & development


Total

 














 









$000's


$000's


$000's

 










 

Result









 

Segment results




(1,082)


(10,627)


(11,709)

 





=======


=======


=======

 











 

Balance sheet










 

Segment assets





1,620


2,217


3,837

 

Segment liabilities





(832)


(193)


(1,025)

 





________


________


________

 

Net assets




788


2,024


2,812

 





=======


=======


=======

 










 

Geographical segments


Denmark


Belize


Jersey


Total

 



$000's


$000's


$000's


$000's

 










 

Result









 

Segment result


(7,088)


(3,539)


(1,082)


(11,709)

 



=======


=======


=======


=======

 









Balance sheet









 

Segment assets - Intangible

550


1,562


-


2,112

 

                           - Other 


46


59


1,620


1,725

 

Segment liabilities


(193)


-


(832)


(1,025)

 



________


________


________


________

 

Net assets


403


1,621


788


2,812

 



=======


=======


=======


=======

 

 

3              Group operating loss

               








2015


2014








$000's


$000's











Loss from operations has been arrived at after charging:




     Directors fees


218


379

     Directors Executive Remuneration (i)


504


1,365

     Auditors Remuneration    - Group



67


104

                                              - Subsidiary 



21


46

     Depreciation




14


15





=======


=======

(i)            2014 includes $115,500 of consulting fees to Hydrocarbon Technologies Ltd. for the period from Kelleher's resignation to 30 April 2015 of which $77,000 was applied as payments on the Hydrocarbon Technologies Ltd. loan.

 

4              Auditor remuneration disclosure








2015


2014








$000's


$000's

Fees payable to the Company's auditor for the audit of the Company's annual accounts

 

43


 

76






Fees payable to the Company's auditor for other services:




     Audit-related assurance services



24


28





=======


=======

5              Directors' remuneration





Management

Fees

Total









Services



2015






$000's

$000's

$000's

Executive Directors:







Peter Sztyk (ii)  (resigned 17/11/2015)

252

28

280

Georges Sztyk (ii)




252

30

282

Non-Executive Directors:







Stephen Polakoff (iii)  (includes fees payable in shares of $18,000)

                       -

48

48

Chris Einchcomb (iii)  (includes fees payable in shares of $20,000)

                       -

46

46

Fred Hodder (iii)  (includes fees payable in shares of $23,000)

                            (resigned 17/11/2015)

 

                       -

 

50

 

50

Adam Reynolds (elected 17/11/2015)

-

8

8

Nicholas Lee (elected 17/11/2015)

-

8

8






======

======

======





504

218

722





======

======

======

 





Management

Fees

Total









Services



2014






$000's

$000's

$000's

Executive Directors:







Bill Kelleher (i)  (resigned 13/10/2014)



579

25

604

Peter Sztyk (ii)




393

30

423

Georges Sztyk (ii)




393

30

423

Non-Executive Directors:







Stephen Polakoff (iii)  (includes fees payable in shares of $35,000)

                       -

88

88

Fred Hodder (iii)  (includes fees payable in shares of $54,000)

                       -

115

115

Chris Einchcomb (iii)  (includes fees payable in shares of $45,000)

                       -

91

91






======

======

======





1,365

379

1,744





======

======

======

 

(i)            Management services provided by and payable to Hydrocarbon Technologies Ltd.  Includes $115,500 of consulting fees for the period from Kelleher's resignation to 30 April 2015 of which $77,000 was applied as payments on the Hydrocarbon Technologies Ltd. loan.

(ii)           Management services were provided by and payable to Dynamic Investments Ltd.

(iii)          Fees payable in shares for 2015 totalling $62,000, for 2014 totalling $134,000 and for 2013 totalling $65,000 were issued after year end, as discussed in Notes 20 and 24.

 

No pension benefits are directly provided for any Director.

 

 

6              Interest receivable








2015


2014








$000's


$000's











Interest received on other receivables

10


24



=======


=======

 

7              Taxation

 

No charge to Jersey corporation tax arises on the results for the year due to the applicable zero tax rate.  No trading profit has arisen in any other tax jurisdiction.

 

No deferred tax asset has been recognised due to the applicable zero tax rate, however the unrelieved tax losses which are estimated to be available for offset against future profits if the applicable tax rates were to change in the future amount to approximately $30 million (2014: $30 million).

 

8              Loss per share

 








2015


2014











The calculation of loss per share is based on the loss after taxation divided by the weighted average number of shares in issue during the year:









Loss for the year ($000's)

(4,220)


(11,709)







Number of shares






Weighted average number of ordinary shares for the purposes of basic loss per share (millions)

2,588


703

Basic and diluted loss per share (expressed in cents)

(0.16)


(1.67)

 

As inclusion of the potential ordinary shares would result in a decrease in the earnings per share they are considered to be anti-dilutive, as such, a diluted earnings per share is not included.

 

9              Tangible assets - Group and Company





Furniture and Fixtures

Plant and Equipment

 

 Total









$'000

$'000

$'000

Cost









Balance carried forward

17

40

                          57

 

Additions during year to 31 December 2015


-

-

                            -

 

Disposals during year to 31 December 2015


-

-

                            -

 





________

________

________

Carried forward at 31 December 2015


17

40

                           57

 





________

________

________

Depreciation








Balance carried forward


16

26

                           42

 

Charge for year to 31 December 2014


4

11

                           15

 

Charge for year to 31 December 2015


5

9

                           14

 

Eliminated on disposal


(8)

(6)

                        (14)

 





________

________

________

Carried forward at 31 December 2015


17

40

                          57

 





________

________

________

Net Book Values







At 31 December 2015


-

-

                             -

 



=======

=======

              =======

 

At 31 December 2014




                  5

         9

14



=======

=======

              =======

 

 

10           Intangible assets - Group 2015







Exploration and Project Development Expenses











$'000

Cost









As at 1 January 2015




12,612

Additions




60







_______

As at 31 December 2015




12,672







_______

Accumulated amortisation and impairment




As at 1 January 2015




(10,500)

Impairment charge






(2,172)





_______

Balance at 31 December 2015




(12,672)







_______






Net book value





As at 31 December 2015




-





_______

As at 31 December 2014




2,112





_______

 

 







 

Exploration and Project Development Expenses











$'000

Cost









As at 1 January 2014




12,349

 

Additions




263

 







_______

As at 31 December 2014




12,612

 







_______

Accumulated amortisation and impairment




 

As at 1 January 2014




-

 

Impairment charge






(10,500)





_______

 

Balance at 31 December 2014




(10,500)

 







_______






 

Net book value





 

As at 31 December 2014




2,112

 





_______

 

As at 31 December 2013




12,349

 





_______

 

 

In 2015, the Company relinquished it Danish licenses.  Accordingly, a charge to increase the impairment reserve for its Denmark intangible assets to 100 per cent was recorded during the year.  The Directors also undertook an impairment review of the Group's Belize intangible assets as of 31 December 2015 and determined it prudent to impair the Belize intangible assets to 100 per cent based on the 2016 deadline for the Group to continue its work programme, the availability of funds to do so, and the current depressed global price of oil.

 

11           Inventories

 

Inventories were nil.  The 2014 inventories were $50,000 and comprised drilling and related consumables and were stated at the lower of cost and estimated net realisable value.

 

12           Trade and other receivables



2015


2014







Group

Company


Group

Company

Current trade and other receivables

$000's

$000's


$000's

$000's








Other receivables  - Related Parties


-

-


517

517

                              - Al Maraam


1,368

1,368


1,368

1,368

                              - Provision for Al Maraam

(1,368)

(1,368)


(1,368)

(1,368)



________

________


________

________



-

-


517

517




=======

=======


=======

=======









Non - current trade and other receivables






Amounts due from subsidiaries

-

33,466


-

33,233

Provision


-

(33,466)


-

(31,230)



________

________


________

________



-

-


-

2,003



=======

=======


=======

=======

 

The amounts due from subsidiaries are interest free with repayment not anticipated within 12 months of the end of the reporting period.

 

The Directors consider that the net carrying amount of trade and other receivables approximates to their fair value.

 

13           Trade and other payables - current



2015


2014







Group

Company


Group

Company


$000's

$000's


$000's

$000's








Trade payables


61

41


53

29

Accruals


678

674


972

803



________

________


________

________




739

715


1,025

832




=======

=======


=======

=======

 

The Directors consider that the carrying amount of trade payables approximates to their fair value.

 

14           Share capital








2015


2014








Number of


Number of








shares


Shares





Called up, allotted, issued and fully paid:















As at 31 December






Ordinary shares of no par value

4,591,596,741


702,723,713


===========


=========

 

On 11 June 2015, the Company announced an Open Offer and Placing to raise gross proceeds of $5.4 million (£3.5 million) through the issue of 3,888,873,028 shares at a price of 0.09p per share and these shares were duly allotted and issued on 7 July 2015.

 

The Company issued no shares in 2014.

 

15           Outstanding warrants and options

 

                As at 31 December 2015 the number of outstanding warrants and options were:-

 

                -               18,900,000 warrants exercisable at 2p expiring on 28 March 2016;

-               14,069,500 warrants exercisable at 5p expiring on 11 May 2016;

                -                 2,375,000 warrants exercisable at 8p expiring on 25 July 2017;

                -                 2,750,000 options exercisable at 9.25p expiring on 25 July 2022.

 

During the year 5,598,251 warrants exercisable at 9p lapsed together with 6,375,000 warrants exercisable at 8p.

 

16           Share-based payments

 

The group operated a Long Term Incentive Plan to allow certain Directors (being the Directors at the time of initial AIM admission) to be granted awards in respect of Ordinary Shares in the Company.  This plan lapsed in 2014 with no amount being due to any Director.

 

The Group also operates a Discretionary Annual Bonus Plan that may be paid in Ordinary Shares; however, this plan was been suspended by the Directors in 2014.

 

As at 31 December 2015 no amounts have been provided or accrued in relation to the above schemes.

 

17           Investment in subsidiaries








2015


2014








$000's


$000's











As at 1 January

26


26

Additions


-


-


________


________

At 31 December



26


26




________


________

 

The subsidiaries of New World Oil and Gas Plc, all of which have been included in these consolidated financial statements, are as follows:

 

Name





Country of incorporation

Proportion of ownership interest

Nature of business

Directly-held subsidiaries












Gaia Resources Limited

(1)

British Virgin Islands

100%

Holding Company







Emery SARL




(2)

Luxembourg

100%

Holding Company






New World Oil and Gas (Belize) Limited


(3)

Belize

100%

Oil and Gas Exploration







New World Oil and Gas (Belize) Operations Limited

(3)

Belize

100%

Oil and Gas Exploration

 

Indirectly-held subsidiaries














New World Jutland Aps


(4)

Denmark

100%

Oil and Gas Exploration







New World Operations Aps


(4)

Denmark

100%

Oil and Gas Exploration







New World Resources Aps


(5)

Denmark

100%

Oil and Gas Exploration







New World Resources Operations Aps


(5)

Denmark

100%

Oil and Gas Exploration

(1)           Subsidiary was acquired on incorporation on 4 January 2011

(2)           Subsidiary was acquired on incorporation on 1 August 2011

(3)           Subsidiary was acquired on incorporation on 14 June 2011

(4)           Subsidiary was acquired on incorporation on 15 September 2011

(5)           Subsidiary was acquired on incorporation on 8 March 2012

 

 

18           Financial instruments

The Board of Directors determine, as required, the degree to which it is appropriate to use financial instruments to mitigate risk.  Currently the Company's principal financial instruments comprise cash and equity capital.

 

The Company does not enter into complex derivatives to manage risk, however it entered into an equity swap arrangement in 2013 as disclosed in note 19.

 

Foreign currency risk

Foreign exchange risk arises because the Group has operations located in various parts of the world whose functional currency is not the same as the functional currency in which the Group companies are operating.  The Group's net assets are exposed to currency risk giving rise to gains or losses on retranslation into US Dollars.

 

Liquidity risk

The Company's policy throughout the year has been to ensure that it has adequate liquidity by careful management of its working capital.

 

 

19           Derivative financial instrument

During March 2013 the Company entered into an equity swap agreement ("the Equity Swap Agreement") with YA Global Master SPV, Ltd ("YAGM") over 19,999,998 Ordinary Shares ("the Swap Shares").  In return for a payment by the Company to YAGM of £400,000 ($606,000), six monthly settlement payments in respect of such payment were to be made by YAGM to the Company, or by the Company to YAGM, based on a formula related to the difference between the prevailing market price (as defined in the Equity Swap Agreement) of the Company's ordinary shares in any month and a 'benchmark price' of 2.2p per share ($0.03).  Thus the funds received by the Company in respect of the Swap Shares are dependent on the future price performance of the Company's ordinary shares.

 

During 2014, 3,333,333 shares were settled for net proceeds of £10,000 ($16,000).  The remaining balance has been fair valued at 31 December 2014, based on the settlement of the Equity Swap Agreement subsequent to year end, with a resulting provision of $171,000 included in the Income Statement.

 








31 December 2015


31
December 2014








$'000


$'000











Fair Value as at 1 January

-


187

Settled during the year

-


(16)

Fair value adjustment to 31 December



-


(171)




________


________

Fair Value carried forward as at 31 December

-


-




=======


=======

 

 

20           Group related party transactions

Transactions between the parent and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.  Details of Director's remuneration, being the only key personnel, are given in note 5.

 

Included within other receivables are the amounts outstanding on the loans made to facilitate the Executive Directors participation in the March 2013 placing.  In relation to Bill Kelleher an advance of $333,000 was made to Hydrocarbon Technologies Limited and after interest charges of $2,000 (2014: $7,000) and repayments of $58,000 (2013: $77,000) were made the amount outstanding was $150,000 (2013: $205,000).  As of 31 December 2014, a provision for collectability in the amount of $150,000 has been recorded related to this loan.

 

In relation to Peter Sztyk and Georges Sztyk an advance of $667,000 was made to Dynamic Investments Limited and after interest charges of $8,000 (2014: $16,000) and repayments of $469,000 (2014:  $122,000) were made the amount outstanding was nil (2014: $461,000).

 

Included within trade and other payables is unpaid director's fees payable in shares to Fred Hodder of $97,000 (2014: $79,000), to Chris Einchcomb of $83,000 (2014: $66,000) and to Stephen Polakoff of $72,000 (2014: $54,000) and unpaid director's fees payable in cash to Nicholas Lee of $8,000 (2014: nil) and Adam Reynolds of $8,000 (2014: nil).  All unpaid director's fees were paid subsequent to year end either through the issue of shares, see Note 24, or through cash payments.

 

21           Ultimate controlling party

In the opinion of the directors, there is no controlling party.

 

22           Retirement benefit scheme

                The Group does not operate either a defined contribution or defined benefit retirement scheme.

 

23           Commitments

As at 31 December 2015, the Group has no material commitments unaccounted for in the financial statements.

 

24           Events after the end of the reporting period

On 17 February 2016, the Company announced an allotment of 155,189,367 new ordinary shares of the Company.  This included 72,424,600 shares issued to directors of the Company and to a former director in part settlement of director fees, see Notes 5 and 20.  The balance of the allotment was to suppliers in relation to Company operations.

 

25           Profit and loss account of the parent company

As permitted by Jersey Company Law, the profit and loss account of the parent company has not been separately presented in these accounts.  The parent company loss for the year was $4,199,000 (2014: $11,704,000 loss).

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
FR AKKDNDBKBCNN






DateSourceHeadlineCategory
04-Nov-16 12:56RNSResult of AGMResults and Trading Reports
04-Nov-16 07:00RNSCorporate UpdateCompany Announcement - General
24-Oct-16 16:03RNSCorporate UpdateCompany Announcement - General
18-Oct-16 16:44RNSCorporate UpdateCompany Announcement - General
17-Oct-16 07:00RNSMarket update and termination of reverseCompany Announcement - General
12-Oct-16 16:00RNSResult of AGMResults and Trading Reports
11-Oct-16 07:00RNSNotice of AGM UpdateResults and Trading Reports
30-Sep-16 15:06RNSHalf-year ReportResults and Trading Reports
16-Sep-16 07:00RNSAnnual General Meeting - New NoticeResults and Trading Reports
13-Sep-16 07:00RNSNotice of Annual General MeetingResults and Trading Reports
01-Sep-16 07:00RNSUpdate on Big Sofa and AGMCompany Announcement - General
19-Jul-16 11:40RNSUpdate on Big Sofa LimitedCompany Announcement - General
11-Jul-16 17:11RNSDirectorate ChangeExecutive Changes
23-Jun-16 17:38RNSLetters of Requisition for an EGMCompany Announcement - General
17-Jun-16 11:32RNSResult of Extraordinary General MeetingResults and Trading Reports
07-Jun-16 17:03RNSHolding(s) in CompanyHolding(s) in Company
06-Jun-16 15:30RNSHolding(s) in CompanyHolding(s) in Company
26-May-16 07:00RNSHolding(s) in CompanyHolding(s) in Company
25-May-16 07:00RNSNotice of Extraordinary General MeetingCompany Announcement - General
09-May-16 09:40RNSPossible acquisition and suspension of tradingMergers, Acquisitions and Disposals
09-May-16 09:40RNSSuspension - New World Oil & Gas PlcCompany Announcement - General
31-Mar-16 07:00RNSFinal ResultsResults and Trading Reports
14-Mar-16 15:00RNSHolding(s) in CompanyHolding(s) in Company
09-Mar-16 11:01RNSHolding(s) in CompanyHolding(s) in Company
01-Mar-16 07:00RNSHolding(s) in CompanyHolding(s) in Company
18-Feb-16 15:12RNSHolding(s) in CompanyHolding(s) in Company
17-Feb-16 17:32RNSIssue of Equity, Directors' Dealings, TVRCompany Announcement - General
15-Feb-16 07:00RNSUpdateCompany Announcement - General
01-Feb-16 16:35RNSPrice Monitoring ExtensionCompany Announcement - General
16-Dec-15 14:25RNSRe-payment of Director loansCompany Announcement - General


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