Echo Energy Regulatory News (ECHO)

Independent Resources PLC

Interim Results

Twelve months ended 30 September 2013

Highlights

- Transaction pipeline - The company has built a pipeline of potential acquisition targets and hopes to make an announcement to shareholders in the first quarter of next year.

- Fiume Bruna and Casoni (Ribolla) Coal Bed Methane Project - Farm out discussions are proceeding actively to allow for execution of the seismic acquisition program in 2014.

- Ksar Hadada Tunisia - IRG is working actively with the DGE and ETAP to resolve the disappointing failure of the operator to progress matters.

- Rivara Gas Storage - The project remains on hold.

- Net cash at 30 September 2013: £0.97m (2012: £0.73m).

- Interim loss before taxation: £3.06m (2012: £1.82m). The financial results for this period include a loss on the reorganisation of Rivara Gas Storage of £1.51m recognised in the first six months of the period.

Chairman's Statement

As I highlighted in my statement accompanying the March interim results, we have adopted a new strategic approach to our business focusing on building an appraisal, development and production portfolio in the Mediterranean basin. I am now announcing a further set of interim results as we have changed our year end to 31 December. This was previously announced and means that the next set of audited accounts and final results will be for the 15 month period to 31 December 2013.

During the second half of the year we have also been focusing on resolving the position on our existing Tunisian and Italian assets and to ensure that we have a rationalized portfolio with attractive prospects.

A significant effort over recent months on the growing pipeline has advanced prospects and the company hopes to make announcements about next steps to shareholders in the first quarter of next year.

I am also pleased to announce that the Chief Executive has been strengthening and adding to our management team with the appointment of a Chief Operations Officer, Brian Hepp, a Commercial Director, Owain Franks; and a Finance Director, Feilim McCole. Brian has considerable senior level operations experience and was latterly Director, Group Operations for Northern Petroleum Plc. Owain was a senior partner in PwC in the UK and has substantial experience in the Oil and Gas industry. Feilim is an experienced Finance Director and has held this role on both a permanent and interim basis for a number of years in industry. We have managed to agree terms with Owain and Brian that they will work for us on a flexible basis until funds allow (and there is a need for) more of their time to be taken by the company. Feilim has agreed to serve as a full time Finance Director.

If we are successfully to execute our strategy we need appropriate and committed resources but that does not mean that we will not be very cost conscious. We will be reviewing the Group's administrative cost base continuously with a view to containing it to the minimum necessary for effective business development and operations.

Fiume Bruna and Casoni

We are actively progressing promising farm-out discussions with a number of interested parties and expect to reach a resolution so as to allow the seismic acquisition to progress during 2014.

As has been set out in previous reports to shareholders, DeGolyer and McNaughton in April, 2011 confirmed that this significant and attractive onshore coal bed methane resource contains original gas in place of 15.2 billion cubic meters (537 billion cubic feet) and gross mean prospective resources of 4.5 billion cubic meters (160 billion cubic feet).

Public opinion remains positive at local and regional level with the prospect of job creation and new sources of revenue for the community. A new seismic survey is scheduled to be acquired in 2014 to improve the subsurface imaging in the Fiume Bruna exploration permit and to extend the coverage to the adjacent Casoni exploration permit.

A pilot programme has been developed to allow for a low cost early revenue generating phase to be progressed based on up to six wells that have already received environmental approval. Once the farm out is in place, work will commence on this pilot project.

Ksar Hadada

The situation has changed in relation to this onshore licence. IRG owns an 18.97% working interest in the licence which relates to a prospective basin in southern Tunisia.

The operator (PetroAsian (Tunisia) Limited) is now controlled by the Hoifu Energy Group Limited (Hoifu) which is listed in Hong Kong. The operator currently holds a 78.03% interest in the licence. In my last report, I noted that the operator had announced ambitious plans which IRG supported. Unfortunately, Hoifu has been going through some turbulent times at a corporate level and has singularly failed to deliver on plans for Ksar Hadada.

In consequence IRG carefully re-assessed its appetite for this licence. It is clear that the Cambro-Ordovician prospects within the license identified following the 2005 and 2009 seismic programmes and 2010 drilling campaign remain of real interest to the company. The Board is carefully monitoring the political situation in Tunisia but remains of the view that the prospects justify continuing involvement and that the current level of project risk is acceptable.

The company has therefore been undertaking intensive discussions with the relevant Government departments and ETAP, the Tunisian national oil company, to ensure that the current unsatisfactory situation is sensibly resolved and that the programme of required works can be undertaken in a realistic timeframe. The company expects to make further announcements on the position shortly.

Rivara Underground Gas Storage

After the Italian Environmental Ministry's positive EIA Decree for the appraisal phase of the project, and the regional Government denial of its approval, the project was halted, ostensibly due to resident concerns following the May 2012 Emilia earthquake. Our project has had no operational activity conducted on the site.

IRG continues to contest the position of the Emilia-Romagna Region in administrative courts and the consequent position of the Ministry for Economic Development. This process is painstakingly slow and whilst the Board would wish it accelerated, it is taking advice that seeking to move much faster will alienate currently favourably disposed stakeholders and may not be possible in any event.

Business development

The Company mentioned in previous reports two other projects in Italy, namely Sibilla and San Gervasio. Whilst a decision has not yet been announced by the Ministry of Economic Development on the award of the San Gervasio production concession, no activity will be undertaken by the company in relation to Sibilla following the recently awarded decree, pending clarification of some elements of the decree.

In accordance with the revised strategy, the Directors continue to evaluate and pursue acquisitions of companies and interests in assets which would deliver ongoing cash flows from oil and gas production. Management is focused on opportunities which will allow them to apply their experience to enhance production levels significantly.

Management remains committed to controlling cash costs across the Group's operations in order to reduce external cash requirements.

Going concern

The Directors acknowledge that further funding will be required within the next 12 months in order for the Group to continue operating. It is likely that any acquisition will also necessitate a fundraising for the Company's share of future field development. Any fundraising exercise will need to raise sufficient capital to ensure the future viability of the Group.

In the event that no acquisition can be completed in an appropriate timeframe, it may become necessary for an equity fundraising to be completed to provide funds for the Group to meet its ongoing costs.

The Directors are confident that additional external funding should be available if and when required and they have considered the Group's current trading activities, its current funding position and the projected funding requirements for a period at least twelve months from the date of approval of these interim financial statements. Taking all of that into account, they consider it appropriate to adopt the Going Concern basis in preparing results for the twelve months ended 30 September 2013. However, the need to raise new funds represents a material uncertainty.

Outlook

The Company is pursuing a transformational transaction in the strategic focus area of the Mediterranean Basin while it continues to seek alternate sources of capital to advance and de-risk the current portfolio. Recent emphasis has been on Ksar Hadada and building and progressing a pipeline of targets; both have exciting potential, particularly for a company of our size.

We are rigorous in our assessment of potential new opportunities and we believe that there are a number worth progressing. We hope to be in a position to make announcements to shareholders next year in relation to these opportunities.

Chairman Grayson Nash stated, "It is hugely frustrating that we cannot persuade regulators, partners and prospective partners to move as fast as we would like in realising value from our portfolio and from our transaction pipeline. I am however very optimistic that the first half of 2014 will see a major transformation in IRG's position and that shareholders will be as excited as I am by the prospects. We recognize that this has been a long wait for shareholders but we hope and expect that their patience will be rewarded in 2014."

For further information, please visit www.ir-plc.com or contact:

Greg Coleman

Independent Resources plc

020 3367 1134

Phil Davies

Charles Stanley Securities

020 7149 6942

(Nominated Adviser)

Simon Hudson

Tavistock Communications

020 7920 3150

Roberto Bencini, Technical Director of Independent Resources, has reviewed this announcement for the purposes of the current Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange in June 2009. Mr. Bencini is a Chartered Petroleum Geologist. He is a member of the Society of Petroleum Engineers, the Geological Society of London and the American Association of Petroleum Geologists.

* The evaluation of the potential recoverable hydrocarbons mentioned in this announcement has been assessed in accordance with Petroleum Resources Management System prepared by the Oil and Gas Reserves Committee of the Society of Petroleum Engineers (SPE) November 2011 and reviewed and jointly sponsored by the World Petroleum Council (WPC), the American Association of Petroleum Geologists (AAPG) and the Society of Petroleum Evaluation Engineers (SPEE).

Independent Resources PLC

Consolidated statement of comprehensive income

Twelve months ended 30 September 2013

Unaudited

Audited

1 October 2012

to

 30 September 2013

1 October 2011

to

30 September 2012

Notes

Continuing operations

£

£

Revenue

2

-

-

Cost of sales

-

-

Gross profit

-

-

Administrative expenses

(1,551,489)

(1,387,942)

Operating loss before impairment

(1,551,489)

(1,387,942)

Reorganisation of Rivara Gas Storage srl

6

 (1,511,722)

-

Operating loss

(3,063,211)

(1,387,942)

Financial income

3,787

5,784

Financial expense

7

(713)

(437,077)

Loss on ordinary activities before taxation

(3,060,137)

(1,819,235)

Taxation

4

-

-

Loss for the period

(3,060,137)

(1,819,235)

Other comprehensive income:

Exchange difference on translating foreign operations

724,284

 (1,074,067)

Income tax relating to other comprehensive income

-

-

Total comprehensive loss for the period

(2,335,853)

(2,893,302)

Loss attributable to:

Owners of the parent

(3,069,501)

(1,781,779)

Non-controlling interests

9,364

(37,456)

(3,060,137)

(1,819,235)

Total comprehensive loss attributable to:

Owners of the parent

(2,363,261)

(2,752,613)

Non-controlling interests

27,408

(140,689)

(2,335,853)

 (2,893,302)

Loss per share (pence)

5

From continuing operations:

Basic

(6.7)

(3.9)

Diluted

(6.7)

(3.9)

Independent Resources PLC

Consolidated statement of financial position

As at 30 September 2013

Unaudited

Audited

30 September

30 September

2013

2012

Notes

£

£

Non-current assets

Property, plant and equipment

20,639

21,133

Goodwill

450,766

450,766

Other intangible assets

10,105,667

9,466,113

10,577,072

9,938,012

Current assets

Other receivables

8

656,936

3,634,449

Cash and cash equivalents

968,504

729,786

1,625,440

4,364,235

Current liabilities

Trade and other payables

(1,015,338)

(960,671)

(1,015,338)

(960,671)

Net current assets

610,102

3,403,564

Net assets

11,187,174

13,341,576

Equity attributable to equity holders of the parent

Share capital

458,369

458,369

Share premium

15,287,351

15,287,351

Share option reserve

446,168

264,717

Foreign currency translation reserve

631,396

(74,844)

Retained earnings

(5,636,110)

(3,766,319)

11,187,174

12,169,274

Non-controlling interests

-

1,172,302

Total equity

11,187,174

13,341,576

Independent Resources PLC

Consolidated statement of changes in equity

Retained earnings

Share capital

Share premium

Share option reserve

Foreign currency translation reserve

Total

 Non- controlling interests

Total equity

£

£

£

£

£

£

£

£

1 October 2011

(1,984,540)

458,369

15,287,351

109,761

895,990

14,766,931

1,312,991

16,079,922

Loss for the period

(1,781,779)

-

-

-

-

(1,781,779)

(37,456)

(1,819,235)

Exchange differences

-

-

-

-

(970,834)

(970,834)

(103,233)

(1,074,067)

Total comprehensive loss for the period

(1,781,779)

-

-

-

(970,834)

(2,752,613)

(140,689)

(2,893,302)

Share-based payments

-

-

-

154,956

-

154,956

-

154,956

30 September 2012

(3,766,319)

458,369

15,287,351

264,717

(74,844)

12,169,274

1,172,302

13,341,576

1 October 2012

(3,766,319)

458,369

15,287,351

264,717

(74,844)

12,169,274

1,172,302

13,341,576

Loss for the period

(3,069,501)

-

-

-

-

(3,069,501)

9,364

(3,060,137)

Exchange differences

-

-

-

-

706,240

706,240

18,044

724,284

Total comprehensive loss for the period

(3,069,501)

-

-

-

706,240

(2,363,261)

27,408

(2,335,853)

Share-based payments

-

-

-

181,451

-

181,451

-

181,451

Non-controlling interest acquired by group

1,199,710

-

-

-

-

1,199,710

(1,199,710)

-

30 September 2013

(5,636,110)

458,369

15,287,351

446,168

631,396

11,187,174

-

11,187,174

Independent Resources PLC

Consolidated statement of cash flows

Twelve months ended 30 September 2013

Unaudited

Audited

1 October 2012

1 October 2011

to

to

30 September 2013

30 September 2012

£

£

Cash flows from operating activities

Loss before taxation

(3,060,137)

(1,819,235)

Adjustments for:

Reorganisation of Rivara Gas Storage srl

1,511,722

-

Depreciation of property, plant and equipment

9,236

21,385

Loss on disposal of property, plant and equipment

177

-

Financial income

(3,787)

(5,784)

Financial expense

713

437,077

(1,542,076)

(1,366,557)

Decrease in other receivables

1,465,791

470,277

Increase in trade and other payables

54,667

196,779

Share-based payments

181,451

154,956

Exchange rate difference on investments

235,145

(341,796)

Cash used in operations

394,978

(886,341)

Income taxes received

-

-

Net cash used in operating activities

394,978

(886,341)

Cash flows used in investing activities

Interest received

3,787

5,784

Interest paid

(713)

(17,077)

Proceeds on disposal of property, plant and equipment

838

5,042

Purchase of intangible assets

(151,529)

(879,227)

Purchase of property, plant and equipment

(8,643)

-

Net cash used in investing activities

(156,260)

(885,478)

Net decrease in cash and cash equivalents

238,718

(1,771,819)

Cash and cash equivalents at beginning of the period

729,786

2,501,605

Cash and cash equivalents at end of the period

968,504

729,786

Independent Resources PLC

Notes to the interim financial information

Twelve months ended 30 September 2013

1.

Accounting policies

General information

The interim financial information is for Independent Resources plc ("the company") and subsidiary undertakings (together, the "Group"). The company is registered in England and Wales and incorporated under the Companies Act 2006. The consolidated financial information is presented in GBP ("£") unless otherwise stated.

Basis of preparation

As previously announced the company has changed its year end to 31 December, having extended its previous year end from 30 September 2013 to 31 December 2013. The company shall prepare statutory accounts for the 15 month period 1 October 2012 to 31 December 2013. The company therefore presents a further set of interim results.

The interim financial information, for the period from 1 October 2012 to 30 September 2013, has been prepared under the historical cost convention and in accordance with International Financial Reporting Standards and International Accounting Standards as adopted by the European Union, and on the going concern basis. They are in accordance with the accounting policies set out in the statutory accounts for the year ended 30 September 2012.

The Interim Report is unaudited and does not constitute statutory financial statements. The financial information for the year ended 30 September 2012 does not constitute statutory accounts, as defined in section 435 of the Companies Act 2006 but is based on those statutory financial statements. Those accounts, upon which the auditors issued an unqualified opinion, have been delivered to the Registrar of Companies.

The interim consolidated financial statements for the twelve months ended 30 September 2013 have been prepared in accordance with IAS 34, Interim Financial Reporting.

Going concern

The Directors acknowledge that further funding will be required within the next 12 months in order for the Group to continue operating.

The Directors are confident that additional external funding should be available if and when required and they have considered the Group's current trading activities, its current funding position and the projected funding requirements for a period at least twelve months from the date of approval of these interim financial statements. Taking all of that into account, they consider it appropriate to adopt the Going Concern basis in preparing results for the twelve months ended 30 September 2013. However, the need to raise new funds represents a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern.

The interim financial information does not include any adjustments that may be required should the Group be unable to continue as a going concern. If the Group were unable to continue as a going concern, then adjustments would be necessary to write assets down to their recoverable amounts, non-current assets and liabilities would be reclassified as current assets and liabilities and provisions would be required for any costs associated with closure.

Other information

The operations of Independent Resources Plc are not affected by seasonal variations.

The directors do not propose a dividend for the period (2012: nil).

The Interim Report for the twelve months ended 30 September 2013 was approved by the Directors on 30 December 2013.

Copies of the Interim Report are available from the Company's website www.ir-plc.com.

2.

Business segments

The group has adopted IFRS 8 Operating segments from 1 October 2009. Per IFRS 8, operating segments are based on internal reports about components of the group, which are regularly reviewed and used by the Board of Directors being the Chief Operating Decision Maker ("CODM") for strategic decision making and resource allocation, in order to allocate resources to the segment and to assess its performance. The group's reportable operating segments are as follows:

a.

Parent company

b.

Rivara

c.

Ribolla Basin CBM & Shale Gas Assets

d.

Ksar Hadada

The CODM monitors the operating results of each segment for the purpose of performance assessments and making decisions on resource allocation. Performance is based on assessing progress made on projects and the management of resources used. Segment assets and liabilities are presented inclusive of inter-segment balances.

The group did not generate any revenue during the year to 30 September 2012 nor in the period to 30 September 2013.

Ribolla Basin

Parent company

Rivara

 CBM & Shale Gas Assets

Ksar Hadada

Consolidation

Total

£

£

£

£

£

£