Last checked at 29 Sep 2015 07:00
Petro Matad Limited
('Petro Matad' or the 'Company')
Interim results for the six months ended 30 June 2015
LONDON, 29 September 2015: Petro Matad Limited, the AIM quoted Mongolian oil explorer, is pleased to announce its unaudited interim results for the six months ended 30 June 2015
Financial Summary
The Group posted a loss of USD 1.74 million for the six-month period ended 30 June 2015, which compares to a loss of USD 2.00 million for the comparable period in 2014. The reduced loss in 2015 mainly reflects reduced staff numbers compared to 2014. Significant increases in staff to meet the needs of the ongoing work programme only commenced late in the six-month period. The Company's cash balance at 30 June 2015 was $2.51 million, which compares to a cash balance of $1.88 million on 30 June 2014. The 30 June 2015 cash balance largely arises from the receipt of proceeds from BG Group, which is the result of the previously announced farmout (also referenced below).
Operational Update
As previously announced on 7 April 2015, the Company has successfully concluded a farmout of its Block IV and V PSCs with BG Group. The farmout became unconditional on 22 June 2015 and was announced on the same date.
The main activity during the first six months of 2015 focused on completing the farmout with BG Group. In anticipation of the successful conclusion of the farmout, the Company also issued tenders for three major work programmes: Airborne Full Tensor Gradiometer (FTG) and High Resolution Aeromagnetics; 2D Seismic Acquisition Programme; and Core Hole Drilling. Contract awards for FTG and 2D seismic acquisition were announced on 7 August 2015 and 13 August 2015, respectively. The core hole drilling tender was suspended as the technical rationale for drilling the core holes is under review.
The FTG programme is nearing successful completion, after which data will be processed and tied to existing and new seismic. The 2D seismic acquisition programme will continue over a number of months, after which the raw data will be processed. The Company expects that the subsequent interpretation of the newly acquired and processed seismic, in combination with FTG and existing seismic data, will be more than sufficient to develop a number of viable drilling prospects. The Company therefore remains on track for exploration drilling in 2016.
About Petro Matad Limited
Petro Matad is the parent company of a group focussed on oil exploration, as well as future development and production, in Mongolia. The Group holds sole operatorship of three Production Sharing Contracts with the Government of Mongolia. Block XX has an area of 10,340km² in the far eastern part of the country. Blocks IV and V are located in central Mongolia. Block IV covers approximately 29,000km² and Block V approximately 21,150km².
Petro Matad Limited is incorporated in the Isle of Man under company number 1483V. Its registered office is at Victory House, Prospect Hill, Douglas, Isle of Man, IM1 1EQ.
Further Information:
Petro Matad Limited NOMAD and Broker
John Henriksen, CFO Westhouse Securities Limited
+976 11 331099 Alastair Stratton / Robert Finlay
+44 (0)20 7601 6100
STATEMENT OF COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED 30 JUNE 2015
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| Consolidated | |
|
| 30 Jun 2015 | 30 Jun 2014 |
|
| $'000 | $'000 |
|
|
|
|
Continuing Operations |
|
|
|
Revenue |
|
|
|
Interest Income |
| 14 | 48 |
Other Income |
| 1 | 1 |
|
| 15 | 49 |
|
|
|
|
Expenditure |
|
|
|
Consultancy fees |
| 445 | 25 |
Depreciation and amortisation |
| 50 | 72 |
Employee benefits expenses |
| 645 | 1,482 |
Exploration expenditure |
| 160 | 34 |
Other expenses |
| 431 | 355 |
Loss from continuing operations before income tax |
| (1,716) | (1,919) |
Income tax expense |
| - | - |
Loss from continuing operations after income tax |
| (1,716) | (1,919) |
Net Loss |
| (1,716) | (1,919) |
|
|
|
|
Other comprehensive loss |
|
|
|
Exchange rate differences on translating foreign operations |
| (19) | (81) |
Other comprehensive income, net of income tax |
| (19) | (81) |
Total comprehensive loss |
| (1,735) | (2,000) |
|
|
|
|
Loss attributable to owners of the parent |
| (1,716) | (1,919) |
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|
|
|
Total comprehensive loss attributable to owners of the parent |
| (1,735) | (2,000) |
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|
Loss per share (cents per share) |
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|
|
- Basic and diluted loss per share |
| 0.61 | 0.69 |
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2015
| Consolidated | ||
| 30 Jun 2015 | 31 Dec 2014 | 30 Jun 2014 |
| $'000 | $'000 | $'000 |
ASSETS |
|
|
|
Current Assets |
|
|
|
Cash and cash equivalents | 2,506 | 895 | 1,884 |
Trade and other receivables | 227 | 241 | 289 |
Prepayments and other assets | 378 | 364 | 458 |
Total Current Assets | 3,111 | 1,500 | 2,631 |
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|
|
|
Non-Current Assets |
|
|
|
Exploration and evaluation | 15,275 | 15,275 | 15,275 |
Property, plant and equipment | 382 | 439 | 511 |
Total Non-Current assets | 15,657 | 15,714 | 15,786 |
TOTAL ASSETS | 18,768 | 17,214 | 18,417 |
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|
|
|
LIABILITIES |
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|
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Current liabilities |
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|
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Trade and other payables | 1,695 | 1,353 | 478 |
Total Current Liabilities | 1,695 | 1,353 | 478 |
TOTAL LIABILITIES | 1,695 | 1,353 | 478 |
NET ASSETS | 17,073 | 15,861 | 17,939 |
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EQUITY |
|
|
|
Issued capital | 105,929 | 105,278 | 105,097 |
Farmout Proceeds | 2,750 | - | - |
Reserves | 4,232 | 4,896 | 5,312 |
Accumulated losses | (95,838) | (94,313) | (92,470) |
TOTAL EQUITY | 17,073 | 15,861 | 17,939 |
CONDENSED CASH FLOW STATEMENT
FOR THE HALF YEAR ENDED 30 JUNE 2015
| Consolidated | |
| 30 Jun 2015 | 30 Jun 2014 |
| $'000 | $'000 |
|
|
|
Cash flows from operating activities |
|
|
Payments to suppliers and employees | (1,228) | (1,383) |
Interest received | 14 | 48 |
Net cash flows from/(used in) operating activities | (1,214) | (1,335) |
|
|
|
Cash flows from operating activities |
|
|
Purchase of property, plant and equipment | (2) | (2) |
Proceeds from the disposal of plant and equipment | - | - |
Net cash flows from/(used in) investing activities | (2) | (2) |
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|
|
Cash flows from financing activities |
|
|
Proceeds from issue of shares | 93 | - |
Farmout Proceeds | 2,750 | - |
Capital raising costs | - | - |
Net cash flows from/(used in) financing activities | 2,843 | - |
|
|
|
Net increase/(decrease) in cash and cash equivalents | 1,627 | (1,337) |
Net foreign exchange differences | (16) | (87) |
Cash and cash equivalents at beginning of period | 895 | 3,308 |
Cash and cash equivalents at end of period | 2,506 | 1,884 |
STATEMENT OF CHANGES IN EQUITY
FOR THE HALF YEAR ENDED 30 JUNE 2015
|
Consolidated | |||||
| Attributable to equity holders of the parent |
| ||||
|
Issued Capital $'000 |
Farmout Proceeds $'000 |
Accumulated Losses $'000 |
Other Reserves $'000 |
Total $'000 |
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|
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As at 1 January 2014 | 105,097 | - | (90,556) | 4,736 | 19,277 |
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Loss for the period | - | - | (1,919) | - | (1,919) |
|
Other comprehensive income | - | - | - | (81) | (81) |
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Total comprehensive income for the period | 105,097 | - | (92,475) | 4,655 | 17,277 |
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Transactions with owners in their capacity as owners |
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|
|
|
|
Issue of share capital | - | - | - | - | - |
|
Cost of capital raising | - | - | - | - | - |
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Share based payments | - | - | 5 | 657 | 662 |
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As at 30 June 2014 | 105,097 | - | (92,470) | 5,312 | 17,939 |
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As at 1 January 2015 | 105,278 | - | (94,313) | 4,896 | 15,861 |
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Loss for the period | - | - | (1,716) | - | (1,716) |
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Other comprehensive income | - | - | - | (19) | (19) |
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Total comprehensive income for the period | 105,278 | - | (96,029) | 4,877 | 14,126 |
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Transactions with owners in their capacity as owners |
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Issue of share capital | 93 | - | - | - | 93 |
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Farmout Proceeds | - | 2,750 | - | - | 2,750 |
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Cost of capital raising | - | - | - | - | - |
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Share based payments | 558 | - | 191 | (645) | 104 |
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As at 30 June 2015 | 105,929 | 2,750 | (95,838) | 4,232 | 17,073 |
|
1. CORPORATE INFORMATION
The financial report covers the consolidated entity of Petro Matad Limited and its controlled entities.
Petro Matad Limited, a company incorporated in the Isle of Man on 30 August 2007 has five wholly owned subsidiaries, including Capcorp Mongolia LLC and Petro Matad LLC (both incorporated in Mongolia), Central Asian Petroleum Corporation Limited ("Capcorp") and Petromatad Invest Limited (both incorporated in the Cayman Islands), and Petro Matad Services Limited (incorporated in the Isle of Man). Its majority shareholder is Petrovis Matad Inc.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The half-year financial report does not include all of the notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the consolidated entity as the full financial report.
The half-year financial report should be read in conjunction with the annual Financial Report of Petro Matad Limited as at 31 December 2014. The half-year consolidated financial statements have been prepared using the same accounting policies as used in the annual financial statements for the year ended 31 December 2014.
It is also recommended that the half-year financial report is considered together with any public announcements made by Petro Matad Limited and its controlled entities during the half-year ended 30 June 2015.
(a) Basis of Preparation
The half-year consolidated financial report is a general purpose financial report, which has been prepared in accordance with the requirements of International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ('IASB'). The half-year financial report has been prepared on a historical cost basis, except where stated.
The financial report is presented in US dollars and all values are rounded to the nearest thousand dollars ($'000).
For the purpose of preparing the half-year financial report, the half-year has been treated as a discrete reporting period.
(b) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Group as at 31 December each year.
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable or convertible are taken into account. The financial statements of the subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist.
A change in the ownership interest of a subsidiary that does not result in a loss of control is accounted for as an equity transaction.
All intercompany balances and transactions, including unrealised profits arising from intra-group transactions, have been eliminated in full. Unrealised losses are eliminated unless costs cannot be recovered.
3. CONTRIBUTED EQUITY
|
| CONSOLIDATED | ||||||
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|
| 30 Jun 2015 | 31 Dec 2014 | ||||
|
|
| $'000 | $'000 | ||||
Ordinary shares (i) 285,238,225 shares paid up (31 Dec 2014: 279,487,279) |
| 105,929 | 105,278 |
| ||||
|
| 105,929 | 105,278 |
| ||||
(i) Ordinary shares
Full paid ordinary shares carry one vote per share and carry the right to dividends.
Movement in ordinary shares on issue | Number of Shares | Issue Price$ | $'000 |
At 1 January 2015 | 279,487,279 |
| 105,278 |
*Exercise of Conditional Share Awards on 23 April 2014 | 5,750,946 | $0.01 | 93 |
Share based payment |
|
| 558 |
At 30 June 2015 | 285,238,225 |
| 105,929 |
|
|
|
|
*As announced on 17 April 2015 and pursuant to the Group's Plan, 5,750,946 shares were awarded upon exercise of Conditional Share Awards with an exercise price per share of $0.01. Of the 5,750,946 Conditional Share Awards shares issued, 5,229,255 of the Conditional Share Awards shares relate to the Conditional Share Awards programme. The other 521,691 Conditional Share Awards shares are pursuant to the Group's Plan.
4. RESERVES
A detailed breakdown of the reserves of the Group is as follows:
|
Merger reserve | Equity benefits reserve | Foreign currency translation | Total |
Consolidated | $'000 | $'000 | $'000 | $'000 |
|
|
|
|
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As at 1 July 2014 | 831 | 5,458 | (977) | 5,312 |
Currency translation differences | - | - | (34) | (34) |
Share based payments | - | (382) | - | (382) |
As at 31 December 2014 | 831 | 5,076 | (1,011) | 4,896 |
|
|
|
|
|
Currency translation differences | - | - | (19) | (19) |
Share based payments | - | (645) | - | (645) |
As at 30 June 2015 | 831 | 4,431 | (1,030) | 4,232 |
5. LOSS PER SHARE
The following reflects the loss and share data used in the total operations basic and diluted loss per share computations:
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| CONSOLIDATED | ||||
|
| 30 Jun 2015 | 30 Jun 2014 | |||
Basic loss per share |
|
|
| |||
Total basic loss per share (US$ cents per share) (note a) | (0.61) | (0.69) |
| |||
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|
| |||
Diluted loss per share |
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|
| |||
Total diluted loss per share (US$ cents per share) (note b) | (0.61) | (0.69) |
| |||
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(a) Basic loss per share |
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The loss and weighted average number of ordinary shares used in the calculation of basic loss per share are as follows: |
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Net loss attributable to ordinary shareholders (US$'000) | 1,716 | 1,919 |
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Weighted average number of ordinary shares for the purposes of basic earnings per share ('000) |
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|
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281,680 | 279,341 |
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(b) Diluted loss per share |
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The loss and weighted average number of ordinary shares used in the calculation of diluted earnings per share are as follows: |
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Net loss attributable to ordinary shareholders (US$'000) | 1,716 | 1,919 |
| |||
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Weighted average number of ordinary shares for the purposes of basic earnings per share ('000) |
|
|
| |||
281,680 | 279,341 |
| ||||
Share Options and Conditional Share Awards could potentially dilute basic loss per share in the future, however they have been excluded from the calculation of diluted loss per share because they are anti-dilutive for both years presented.
6. EVENTS AFTER THE REPORTING DATE
The Directors of the Company again agreed that the non-executive Directors for the six month period 1 October 2014 to 31 March 2015, when the Company was significantly cash constrained, would continue to forego their usual cash director fees and receive Conditional Share Awards under the Company's existing long term equity plan. The Conditional Share Awards were issued on 20 July 2015. The delay in award of the conditional share awards was as a result of the Company being in successive close periods since October 2014. Following completion of the Company's farm-out to BG Group, the non-executive directors have received their directors' fees in cash from 1 April 2015 onwards.
The Conditional Share Awards vested immediately upon award and participants have until 31 March 2016 to exercise these awards at an exercise price of US$0.01 per Petro Matad ordinary share. An aggregate of 1,993,520 conditional share awards were awarded to the non-executive directors of the Company on 20 July 2015, as set out below.
Director | Number of Conditional Share Awards awarded in lieu of fees |
Oyungerel Janchiv | 498,380 |
Enkhmaa Davaanyam | 498,380 |
Philip Vingoe | 498,380 |
Ridvan Karpuz | 498,380 |
On 27 July 2015, pursuant to the Group's Plan, 2,256,550 shares were awarded upon exercise of Conditional Share Awards with an exercise price per share of $0.01. Of the 2,256,550 Conditional Share Awards shares issued, 1,993,520 of the Conditional Share Awards shares relate to the Conditional Share Awards awarded to non-executive Directors in lieu of fees. The other 263,030 Conditional Share Awards shares are pursuant to the Group's Plan.