21 Dec 2015 07:00
21 December 2015
Fastnet Equity plc
("Fastnet" or the "Company")
Interim Results for the six months ended 30 September 2015
We are pleased to report on the progress of Fastnet Equity plc ("Fastnet" or the "Company") and present the unaudited interim results for the six month period ended 30 September 2015.
Operational Highlights
· Concluded detailed asset review of the Company's oil and gas portfolio in light of the rapidly deteriorating economic conditions in the oil and gas sector during the last year
· Transition from an Oil & Gas business to an investment company following the adoption of an investing policy to acquire companies or businesses in the healthcare sector which was approved by shareholders on 28 August 2015
· Post period end, the oil and gas subsidiaries were demerged into a separate company, Fastnet Hydrocarbons Limited, on 17 December 2015. Fastnet Hydrocarbons Limited is held in trust for the benefit of shareholders on the register of the Company as at the close of business on 16 December 2015
· Fastnet will no longer have any ongoing interest or further cost exposure in respect of oil and gas assets
Financial and Corporate Highlights
· US$15.5m cash balance at 30 September 2015 (US$16.8m at 31 March 2015, US$18.8m at 30 September 2014)
· Net loss for the period of US$1.5m (6 months to 31 March 2015: loss of US$39.7m, 6 months to 30 September 2014: loss of US$1.6m). The current period net loss comprises general and administrative costs of US$1.2m and exploration and evaluation costs expensed of US$0.3m
· Change of the functional currency of Company to Euros (€) with the cash balance of US$15.1m converted into €13.7m on 31 October 2015 at an FX rate of US$1:€0.905
· Cash balance of €13.6m as at 30 November 2015 prior to the grant of an unsecured 4 year term loan €660,000 to finance residual running of oil and gas assets
Cathal Friel, Non-Executive Chairman, commented:
"Following the recently announced demerger of our oil and gas assets the Company is well positioned to focus on identifying and assessing potential investment targets within the healthcare sector."
For further information please contact:
Fastnet Equity plc | +353 (1) 644 0007 |
Cathal Friel, Non-Executive Chairman |
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Shore Capital | +44 (0) 20 7408 4090 |
(Nomad & Joint Broker) |
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Bidhi Bhoma, Edward Mansfield |
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Davy | +353 (1) 679 6363 |
(ESM Adviser & Joint Broker) |
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John Frain, Anthony Farrell |
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Camarco | +44 (0) 20 3757 4980 |
Billy Clegg / Zoe Moulton |
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Consolidated Statement of Comprehensive Income
For the six months ended 30 September 2015
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| Unaudited | Audited | Audited |
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| 6 months to 30 September 2015 | 6 months to 30 September 2014 | 12 months to 31 March 2015 |
| Note | US$'000 | US$'000 | US$'000 |
Continuing operations |
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Revenue |
| - | - | - |
Operational costs |
| - | - | - |
Gross loss |
| - | - | - |
General and administrative costs |
| (1,177) | (1,651) | (3,196) |
Impairment of exploration and evaluation assets |
| (308) | - | (36,593) |
Other operating expenses |
| (4) | - | (12) |
Share based payments |
| (30) | (74) | (129) |
Operating loss |
| (1,519) | (1,725) | (39,930) |
Finance income |
| 50 | 95 | 185 |
Net foreign exchange gain |
| 10 | 2 | 4 |
Loss on ordinary activities before taxation |
| (1,459) | (1,628) | (39,741) |
Tax on loss on ordinary activities |
| - | - | - |
Loss and total comprehensive loss for the period attributable to the equity holders of the Company |
| (1,459) | (1,628) | (39,741) |
Loss per share: |
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Loss per share - basic and diluted, attributable to ordinary equity holders of the parent (cent) |
3 |
(0.42) |
-(0.47) |
(11.51) |
Consolidated Statement of Financial Position
As at 30 September 2015
| Unaudited 30 September 2015 | Unaudited 30 September 2014 | Audited 31 March 2015 |
| US$'000 | US$'000 | US$'000 |
Assets |
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Non-current assets |
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Property, plant and equipment | 5 | 11 | 8 |
Exploration and evaluation assets | - | 35,986 | - |
Total non-current assets | 5 | 35,997 | 8 |
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Current assets |
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Trade and other receivables | 58 | 148 | 173 |
Cash and cash equivalents | 15,516 | 18,827 | 16,790 |
Total current assets | 15,574 | 18,975 | 16,963 |
Total assets | 15,579 | 54,972 | 16,971 |
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Equity and liabilities |
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Equity attributable to owners of the parent |
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Share capital | 20,261 | 20,261 | 20,261 |
Share premium | 38,918 | 38,918 | 38,918 |
Other reserves | 2,110 | 1,996 | 2,080 |
Retained deficit | (46,251) | (6,679) | (44,792) |
Total equity | 15,038 | 54,496 | 16,467 |
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Non-current liabilities |
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Liability for share based payments | - | 2 | - |
Total non-current liabilities | - | 2 | - |
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Current liabilities |
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Trade and other payables | 541 | 474 | 504 |
Total current liabilities | 541 | 474 | 504 |
Total liabilities | 541 | 476 | 504 |
Total equity and liabilities | 15,579 | 54,972 | 16,971 |
Consolidated Statement of Cash Flows
For the six months ended 30 September 2015
| Unaudited | Unaudited | Audited |
| 6 months to 30 September 2015 | 6 months to 30 September 2014 | 12 months to 31 March 2015 |
| US$'000 | US$'000 | US$'000 |
Cash flows from operating activities |
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Group operating loss for the period | (1,519) | (1,725) | (39,930) |
Depreciation | 3 | 3 | 6 |
Share based payment expense | 30 | 74 | 129 |
Impairment of exploration and evaluation assets | 308 | - | 36,593 |
Movements in working capital and other adjustments: |
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Decrease/(increase) in trade and other receivables | 115 | (72) | (97) |
Increase/(decrease) in trade and other payables | 37 | (393) | (496) |
Net cash flow used in operating activities | (1,026) | (2,113) | (3,795) |
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Cash flow from investing activities |
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Payments for property, plant and equipment | - | (1) | - |
Expenditure on exploration and evaluation assets | (308) | (16,994) | (17,442) |
Farm-in proceeds | - | 20,410 | 20,410 |
Finance income | 50 | 95 | 185 |
Net cash flow (used in)/from investing activities | (258) | 3,510 | 3,153 |
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Cash flow from financing activities |
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Net proceeds from issue of equity instruments | - | - | - |
Net cash flow from financing activities | - | - | - |
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Exchange and other movements | 10 | 2 | 4 |
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Net change in cash and cash equivalents | (1,274) | 1,399 | (638) |
Cash and cash equivalents at beginning of period | 16,790 | 17,428 | 17,428 |
Cash and cash equivalents at end of period | 15,516 | 18,827 | 16,790 |
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Share capital |
Share premium |
Share based payment reserve |
Merger reserve |
Reverse asset acquisition reserve |
Capital reserve |
Retained deficit |
Total |
| US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 | US$'000 |
Balance at 1 April 2014 | 20,261 | 38,918 | 1,584 | 11,478 | (11,256) | 9 | (5,051) | 55,943 |
Loss and total comprehensive loss for the period | - | - | - | - | - | - | (1,628) | (1,628) |
Share based payments | - | - | 181 | - | - | - | - | 181 |
Balance at 30 September 2014 (Unaudited) | 20,261 | 38,918 | 1,765 | 11,478 | (11,256) | 9 | (6,679) | 54,496 |
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Balance at 1 October 2014 | 20,261 | 38,918 | 1,765 | 11,478 | (11,256) | 9 | (6,679) | 54,496 |
Loss and total comprehensive loss for the period | - | - | - | - | - | - | (38,113) | (38,113) |
Share based payments | - | - | 84 | - | - | - | - | 84 |
Balance at 31 March 2015 (Audited) | 20,261 | 38,918 | 1,849 | 11,478 | (11,256) | 9 | (44,792) | 16,467 |
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Balance at 1 April 2015 | 20,261 | 38,918 | 1,849 | 11,478 | (11,256) | 9 | (44,792) | 16,467 |
Loss and total comprehensive loss for the period | - | - | - | - | - | - | (1,459) | (1,459) |
Share based payments | - | - | 30 | - | - | - | - | 30 |
Balance at 30 September 2015 (Unaudited) | 20,261 | 38,918 | 1,879 | 11,478 | (11,256) | 9 | (46,251) | 15,038 |
Company Information
1. General Information
Fastnet Equity plc ("Fastnet" or the "Company") is a company incorporated in England and Wales. Details of the registered office, the officers and advisers to the Company are presented on the Company Information page at the end of this report. The Company is listed on the AIM market of the London Stock Exchange (ticker: FAST) and the Enterprise Securities Market of the Irish Stock Exchange (ticker: FOI).
The principal activity of the Company during the period was oil and gas exploration. At a general meeting of the Company on 28 August 2015, a fundamental change of business and adoption of an Investing Policy was approved by the shareholders of the Company. The Investing Policy is to acquire companies or businesses in the healthcare sector particularly those in the biopharma sector.
The interim results of the Company for the six month period ended 30 September 2015 comprise the Company and its subsidiaries (together the "Group").
2. Basis of Preparation
The interim results have been prepared on the basis of the recognition and measurement requirements of International Financial Reporting Standards ("IFRS") as adopted by the European Union ("EU"), and their interpretations adopted by the International Accounting Standards Board ("IASB"). As is permitted by the AIM rules the Directors have not adopted the requirements of IAS34 "Interim Financial Reporting" in preparing the financial statements. Accordingly the financial statements are not in full compliance with IFRS and have neither been audited nor reviewed pursuant to guidance issued by the Auditing Practises Board. The accounting policies used in the preparation of the interim financial information are the same as those used in the Company's audited financial statements for the year ended 31 March 2015 and are expected to be used in the 31 March 2016 year-end financial statements.
The financial information for the six months ended 30 September 2014 and 30 September 2015 is unaudited. The financial information presented for the year ended 31 March 2015 is an extraction from the Group's audited accounts and therefore does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006 on which the auditors issued an unqualified report. The auditor's report also did not contain a statement under Section 498(2) or 498 (3) of the Companies Act 2006 and did not include reference to any matters the auditor drew attention by way of emphasis. The accounts for the year ended 31 March 2015 have been delivered to the Registrar of Companies. The Directors consider that the financial information presented in this Interim Report represents fairly the financial position, operations and cash flows for the period, in conformity with IFRS. The Interim Report for the six months ended 30 September 2015 was approved by the Directors on 21 December 2015.
Presentation of Balances
The Financial Statements are presented in US Dollars ("US$") which was the functional and presentational currency of the Company during the period and the functional currency of all the Group's subsidiary companies. Balances in the Financial Statements are rounded to the nearest thousand ("US$'000") except where otherwise indicated. In light of the Company's fundamental change in business the directors have reviewed the functional currency of Company and determined with effect from 1 November 2015 that Euro ("€") will be the appropriate functional currency going forwards (see note 4.)
3. Loss per Share - Basic and Diluted
The Group presents basic and diluted loss per share ("LPS") data for its Ordinary Shares. Basic LPS is calculated by dividing the loss attributable to Ordinary Shareholders of the Company by the weighted average number of Ordinary Shares outstanding during the period. Diluted LPS is determined by adjusting the loss attributable to Ordinary Shareholders and the weighted average number of Ordinary Shares outstanding for the effects of all dilutive potential Ordinary Shares, which comprise warrants and share options granted by the Company.
The calculation of loss per share is based on the following:
| 6 months to 30 September 2015 | 6 months to 30 September 2014 | 12 months to 31 March 2015 |
Loss after tax attributable to equity holders of the parent (US$'000) | (1,459) | (1,628) | (39,741) |
Weighted average number of Ordinary Shares in issue | 345,369,071 | 345,369,071 | 345,369,071 |
Fully diluted average number of Ordinary Shares in issue | 345,369,071 | 345,369,071 | 345,369,071 |
Basic and diluted loss per share (cent) | (0.42) | (0.47) | (11.51) |
Where a loss has occurred, basic and diluted LPS are the same because the outstanding share options and warrants are anti-dilutive. Accordingly, diluted LPS equals the basic LPS.
The share options and warrants outstanding as at 30 September 2015 totalled 13,819,726 (31 March 2015: 20,397,423, 30 September 2014: 25,397,423) and are potentially dilutive.
4. Subsequent Events
Change of Functional and Presentational Currency
Following the companies fundamental change in business in August 2015 the Company will be funded in Pounds Sterling ("£"), alongside incurring costs in £, Euro ("€") and US$. Having considered the aggregate effect of all relevant factors, the Directors have concluded that € will be the appropriate functional currency of the Company with the change becoming effective from 1 November 2015. This reflects the fact that € is the predominant currency in the economic environment in which the Company operates and expects to operate in going forward. In line with IAS 21 when there is a change in an entity's functional currency the change should take place with effect from the date the Company determined that the characteristics required to identify the functional currency had changed. The Company determined that this change occurred during Q4 2015 and is effective for accounting purposes from 1 November 2015. The Group and Company will also adopt the € as the presentational currency going forward.
Demerger of Oil and Gas Assets
The Company's oil and gas subsidiaries were acquired by Fastnet Hydrocarbons Limited ("Fastnet Hydrocarbons"), on 17 December 2015 for an aggregate sum of £1. Fastnet Hydrocarbons is held in trust for the benefit of shareholders on the register of the Company as at the close of business on 16 December 2015. As a consequence the Group will no longer have any ongoing interest or further cost exposure in respect of oil and gas assets.
Prior to the demerger, as at 30 November 2015, the Company's cash balances amounted to €13.6m. As part of the demerger an unsecured four year term loan of €660,000 was granted to finance the residual running of oil and gas assets.
5. Copy of the Interim Report
Copies of the Interim Report are available to download from the Company's website at
www.fastnetequity.com.