RED.L Regulatory News (RED)

Camco Clean Energy plc

("Camco Clean Energy" or the "Company")

2013 Final Results

Camco Clean Energy plc (AIM: CCE), the clean energy and energy storage company, today announces its final results for the 12 months ended 31 December 2013.

Financial

· Revenue for the year €12.3m (2012: €6.5m after Carbon price fair value adjustment) reflecting a full year of operation of the Jerome Facility and a positive contribution from the Carbon business.

· Significantly reduced loss for the year of €3.8m (2012: loss €23.2m) and increase in gross profit for the year to €7.0m (2012: €0.1m).

· Overall administrative expenses reduced by 25% to €9.3m (2012: €12.4m). Excluding administrative expenses within the Jerome Facility and non-cash charges in respect of share based payments, administrative expenses fell by 34% to €7.9m (2012: €11.9m).

· Cash and cash equivalents of €4.5m (2012: Adjusted Net Cash(1) €7.1m) including €1.0m (2012: €1.0m) held within the Jerome Facility. Cash and cash equivalents as at 31 May 2014 of €3.4m.

· Secured loans and borrowings of €10.4m (2012: €11.6m) and unsecured loans and borrowings of €Nil (2012: €4.0m). As a result, at the end of 2013 the only loans and borrowings are within the entity holding the Jerome Facility and secured solely against those assets.

Operational

· Stability plan successfully completed and business repositioned in three key growth areas of the clean energy market, each making significant progress: REDT Clean Energy Storage, US Clean Energy, and Africa Clean Energy.

· REDT Clean Energy Storage- demonstration system deployed in Evora, Portugal; award of £3.6m contract to build a 1.26MWh utility scale storage system; outsourced manufacturing contract signed with Jabil Circuit, Inc (JBL NYSE) to enable commercialisation of high quality REDT battery at large volumes to meet strong demand for storage.

· US Clean Energy - Jerome Facility running at over 96% availability since beginning of 2013; Twin Falls Facility acquired in December 2013 and running at over 98% availability; US Carbon business delivering increasing cash flow as credits from portfolio continue to be delivered.

· Africa Clean Energy - As a result of the extensive presence across Africa serviced from five regional offices located in Kenya, Tanzania (2), South Africa and Togo the Group has been involved in a number of significant tenders which it hopes will result in new business for the Company over the coming months.

· Hibernation of our CDM business effectively completed leaving the business in a more secure position than 2012.

Current Trading

Camco has had a positive start to 2014 with significant developments in each of our three core business areas. 

Our two agricultural biogas operations in the USA are both trading ahead of the Board's expectations. We are particularly pleased with the progress made in integrating the Twin Falls Facility and the increased power production over our targets set internally at the time of acquisition in late 2013. Our US Carbon business is also now starting to provide a meaningful contribution to cash flow as the credits start to be delivered and sold. 

Our energy storage business, REDT Energy, remains on track to deliver the 1.26 MWh system into Gigha in early 2015. We were also extremely pleased with the recent major step forward for this business with the signing of an outsourced manufacturing agreement with our global partner, Jabil Circuit Inc, which we believe will unlock the pent up demand we are seeing in the energy storage market and enable the business to start to deliver meaningful revenues and cash flow.

Our Africa clean energy consulting business has also had a good start to the year and continues to work and bid on projects throughout sub-Saharan Africa. We are working hard to grow this business to deliver complementary revenue streams and have a number of prospects available to us. 

With the opportunities available to us across our business units, the Board remains confident and excited about the future prospects of the Company.

Commenting, Scott McGregor Chief Executive Officer said:

"2013 was a turn-around year at Camco. We now have three clearly defined business units addressing key areas of the clean energy market, each with demonstrable growth strategies. We have commenced the first half of 2014 with some exciting opportunities which we have already secured and progressed. Our task now is to deliver these opportunities, particularly in relation to REDT Energy, and build on the foundations put in place last year. In doing so, we are focused on building long term equity value for shareholders."

Enquiries:

Camco Clean Energy plc +44 (0) 20 7121 6100

Scott McGregor, Chief Executive Officer

Jonathan Marren, Chief Financial Officer

N+1 Singer (Nominated Adviser and Broker) +44 (0) 207 496 3000

Andrew Craig

Ben Wright

Newgate Threadneedle

Caroline Forde, Josh Royston, Hilary Millar +44 (0) 207 653 9850

 Note (1) - Adjusted net cash position

The adjusted net cash position includes cash held in a debt reserve in relation to the Jerome Facility of €0.98m (2012: €1.03m) which is not available to the Group for general working capital purposes. It did not include net cash held by Camco South East Asia Limited ("CSEA") as at 31 December 2012 which Camco Clean Energy accounted for as a joint venture. Camco Clean Energy disposed of its interest in CSEA on 7 May 2013.

About Camco Clean Energy

Camco Clean Energy plc (AIM: CCE) is a clean energy development company which combines technical and commercial expertise to finance, develop, and operate renewable energy projects and storage technology.

With 25 years of experience and an outstanding track record throughout Asia, North America, Africa and Europe, Camco works with local developers, governments, development banks, and private investors to implement clean energy projects, policies, and technologies and reduce emissions.

In the last year, Camco has developed utility scale biogas plants in the US, managed the funding of a number of smaller scale solar and biogas projects in Africa, and brought an advanced energy storage technology to market (REDTenergy).

Chairman's Report

Two years ago the Board approved a stability plan to reposition our business in view of the collapse of the European carbon market. I am pleased to report that by the end of 2013 the plan was completed and our business has been repositioned in three key clean energy growth areas.

We entered the US market in 2007 and have built up a leading position in our sector. This was recognised by our recent award as Project Developer of the Year by the Climate Action Reserve - the first time this award has been given. Our focus has been on the development of cleaner gas projects where there are strong legislative drivers; not only energy and climate changes policies such as the White House Climate Action Plan but also legislation to divert food waste from landfill sites. We now have one of the leading biogas project development teams in the USA and we are operating the largest agricultural methane facility in the USA. Our plan is to build on the platform we have established and develop new assets with long term annuity cash flows.

We have been working in Africa for over 25 years and have seen the clean energy market change from donor funded demonstration projects to become a commercial necessity. Indeed, clean energy now often provides cheaper power than fossil fuel alternatives. There is a chronic shortage of power in sub Saharan Africa and a growing appetite to invest in the African clean energy sector. African governments are introducing supportive legislation and we have advised several governments on their clean energy policies. Our on the ground experience and relevant local experience puts us in a competitive position in this growth market.

Our third and highest growth area is energy storage. Our first investments in the REDT flow energy battery were in 2000 and while this was not a core area at that time, our storage team has worked hard to develop a commercial product culminating in the award of a £3.6m contract to build a 1.26MWh utility storage facility on the island of Gigha, Scotland. Electricity grids are becoming smarter with small distributed power generation. They will transform from a top down approach that was needed with large national power stations to a network of localised generation and demand. Electricity storage is a key element of this transformation and market forecasts of a multi-billion pound market in the next few years support this. This area is now key for us and our focus is to move from demonstration to commercial sales through the reduction in the cost of production of units, which the recently announced outsourced manufacturing contract with Jabil Circuit, Inc. will enable us to achieve.

Turning a business round is challenging and requires intensive work and our executive directors have worked extremely hard and diligently to deliver the stability plan. I would like to thank them and my fellow non-executive directors for the contributions that they have made to the Company in the past year. Finally I would also like to thank our management and staff for their support in 2013. We now have a leaner and fitter base from which we can rebuild our business in 2014.

Jeffrey Kenna

Chairman

Chief Executive Officer's Report

Summary and Outlook

2013 was a turnaround year at Camco and we completed the year as a completely different company from which we started. We commence the first half of 2014 with some exciting opportunities which we have already started to secure and progress. All of our staff have worked tirelessly to put the business in the position it is today and I want to personally thank each one for their hard work and dedication in often extremely challenging circumstances. It is rare that a company can survive a complete market collapse of its core business whilst securing growth opportunities in parallel, huge credit to all our team, partners and shareholders for their determination and conviction to ensure the Company's success.

We started 2013 on the back of the external market collapse of the Certified Emission Reduction unit ("CER") price by 96% in 2012 which had resulted in the elimination of revenue and cash flow from what had been our core business and a need to manage very carefully the resulting liability and contingent liability position. We also had an operational cost base misaligned to the remaining business units and as a result rapidly depleting financial resources.

The position at the start of 2014 is materially different with 3 clearly defined business units having demonstrable growth strategies, an operational cost base that has been reduced to the absolute minimum whilst retaining the necessary functionality and no contingent liabilities.

These 3 business units are focused on 3 key themes which we see developing across the wider clean energy sector being (i) the need for effective energy storage to accelerate the pace of the worldwide roll-out of renewable technology; (ii) the increasing demand for investment into African clean energy projects to alleviate poverty and increase electrification rates; and (iii) deployment of clean energy in developed world countries to reduce emissions from polluting industries but in a way that is cost effective for the industry in question.

Our task in 2014 is to now deliver these opportunities we have created and build on the foundations put in place last year. In doing so, we are focused on building long term equity value for shareholders which we believe, once recognised, will lead to increased investor demand and subsequent long term share price appreciation.

Operational review

Significant progress has been made across each of our 3 main business units; US Clean Energy, Africa Clean Energy and REDT Clean Energy Storage. In addition, our efforts to hibernate our CDM business were effectively completed which, together with the disposal of entities containing the majority of our liabilities, leaves us in a much more secure position than last year.

The financial information in these Report and Accounts split our operations into two segments, being Carbon and Projects. Given the growth potential of the business units within Projects and the focus generally away from carbon activity, the Board may in the future, look to report its operations on a different segmental basis.

US Clean Energy

The US Clean Energy business comprises the Jerome Facility, an operating 4.5MW biogas plant, our US Carbon business and the Twin Falls Facility, an operating 2.1MW biogas facility, which was acquired for $2.7m in cash shortly before the year end.

The Jerome Facility commenced operation in July 2012 with 2013 being its full year of operation. The facility is situated on a dairy farm in Idaho comprising in excess of 17,000 dairy cows and is integral to the logistical operation of the dairy, significantly reducing the cost otherwise incurred in dealing with the vast amounts of cow manure generated and crucially reducing emissions for the dairy owner and facilitating compliance with stringent US environmental regulations. Key for this facility is to match or exceed its monthly minimum forecast power production targets so as to ensure it receives its full power price available to it under the power purchase agreement which it did so for the whole of the year, as it did for 2012 and to date in 2014. The facility also generates a significant number of US carbon credits eligible for the California market and which will generate good cash flow when they are issued as California Carbon Offsets (see below) which we anticipate to occur in the next few months.

The majority of the construction capital for the Jerome Facility was sourced from project debt secured on the facility and a mezzanine facility which was repaid in 2012 upon receipt of the US grant of circa $6.0m. As a result, the accounting treatment for the net value of the Jerome Facility represented within the Group's net asset position is nominal as the gross depreciated value of the assets are approximately offset by the value of the debt and the deferred income balance (relating to the 2012 US grant receipt). As anticipated, interest on and repayment of the debt does account for significant portion of the cash flow generated by the asset and therefore we were pleased in January 2014 to be able to refinance this debt on better terms thereby decreasing this cash outflow over the next two years.

The Twin Falls Facility is situated close to the Jerome Facility on a dairy farm in Idaho comprising in excess of 10,000 dairy cows and, like the Jerome Facility, is crucial to the operation of the dairy overall. The integration of the facility into our operations has progressed extremely well and we are very pleased with its first few months of operation under our ownership, which continues to be ahead of target. As with the Jerome Facility, the Twin Falls Facility needs to match or exceed its monthly minimum forecast power production targets and has done so for the 5 months since being acquired by the Group. The facility was acquired debt free and does not currently have any debt secured against it.

We have gained significant expertise in operating biogas assets through operating the Jerome Facility, the largest of its kind in the US. This expertise was evident during the evaluation process in acquiring the Twin Falls Facility where in particular the team were able to advise and have implemented improvements to the operating procedure in advance of the acquisition completing to ensure the smooth and efficient running of the facility when we took ownership. We are also confident that the Company will benefit operationally from the close proximity of these two plants.

Our US team continues to focus on further business development in the clean gas space and the ability to grow the pipeline is significantly enhanced by the credibility gained from our two operating assets.

In addition, in the second half of 2013 we were very pleased to see the first issuances of carbon credits (pursuant to the Ozone Depleting Substances and Agricultural Methane methodology) under California's cap-and-trade program (the "California Program") both in the form of California Carbon Offsets ("CCOs") from our portfolio of US carbon credits. At the year end, all our issued CCOs had been sold together with the voluntary credits issued from our forestry project in Afognak, Alaska which delivered good cash flow.

We anticipate issuing 405,000 CCOs in 2014 from our portfolio of Agricultural Methane projects that are managed on behalf of our dairy partners where we receive a revenue share as well as an additional 128,000 CCOs which we own from our Jerome and Twin Falls Facilities. Further CCOs are anticipated to be delivered each year between 2015 through 2021 although not to the same volumes as 2014, as 2014 includes volumes held over from 2013 (as a result of delays in the issuance of CCOs caused by the slower than anticipated implementation of regulations governing offsets under California's cap-and-trade program).

Our policy is to sell CCOs when they are issued and where possible lock-in in advance prices to mitigate potential CCO price risk.

Africa Clean Energy

The Group's heritage can be traced back to East Africa in 1989 where it initially focused on environmental and energy projects. Today, it has a well developed presence across Africa serviced from 5 regional offices located in Togo, Kenya, Tanzania (2), and South Africa with 23 client focused full-time employees.

During the latter part of 2013, the team submitted, alongside its development partner MW1, a 5MW solar project into the first round of the Small IPP Procurement Program in South Africa and we were pleased to be notified in March 2014 that it had been shortlisted for the next round. The project will now be submitted to the final round which is expected to commence mid-2014.

Throughout 2013, our team in South Africa has been involved in on-going carbon and energy management, carbon foot printing and reporting for a number of long term private sector clients in the mining, industrial and hotel sectors. Other major projects include a World Bank programme on municipal energy efficiency planning for Nairobi, Accra and Addis Abba, on-going support to Durban's Solar City programme, and development of a Renewable Energy Feed-in-Tariff for Zimbabwe. Key projects for 2013 include providing support to the National Treasury on Electricity Trends and Offsets for the Carbon Tax, in addition to a major programme for the Department of Environmental Affairs on Climate Change Mitigation Potential Analysis. Camco has recently been awarded the follow-up contract to develop the Desired Emission Reduction Outcomes ("DEROs"), a cornerstone of the South African Government's approach to climate change mitigation. In addition, Camco has been awarded a contract by the South African Green Fund to assist in the design of a trading platform within the Johannesburg Stock Exchange for Emission Reductions under the proposed carbon tax.

In Tanzania the team was recently awarded a $1 million contract through USAID's Powering Agriculture Grand Challenge to implement a project to establish biomass powered mini- grids for communities in Benin and Tanzania. The project will involve promoting and commercializing Village Industrial Power Plants ("VIPs") and will result in 50 village agro-processing centres with associated mini-village grids, all powered by agricultural waste (biomass). The mini-village grids will provide between 10-50kWp of electricity for households, social services and businesses. Local technology manufacturers will assemble and sell VIPs to rural enterprises. These rural enterprises will generate, use and sell electricity through a village ESCO (energy service company) model. Targeting initially palm oil producing communities, the VIP technology can also run on other forms of agricultural biomass waste, such as rice and coffee husks and maize cobs.

The Togo office is also designing a solar PV project for the Netherlands development agency SNV, based upon vocational and entrepreneurial training and quality control through a dedicated project logo. In Sierra Leone and Tanzania, we are completing national biomass energy strategies with support from those national governments and the European Union. Also in Tanzania, we continue to promote bulk procurements of solar home systems for rural farmers through our EU-supported Clusters PV Project. We are actively developing new initiatives related to solar PV, women entrepreneurship in clean energy, solar lighting for night time fishing, and improved cookstoves.

In Kenya, the team continues to grow in its business offerings focusing on (i) Climate Change Planning and Policy; (ii) Agriculture, Biomass, Land use and Forestry; and (iii) Rural Energy Development and Energy Services. The Team was recently awarded The Carbon Reduction, Resources and Opportunities Toolkit ("CaRROT") and Draft Voluntary Standardsto strengthen Kenya's competitive position in global markets. The team has been awarded "Reduced Emissions through deforestation and forest degradation" - "REDD" - projects in Nepal (identifying and quantifying decreases and increases in forest carbon stocks and to project future trends) and Kenya (supporting the restoration of the Mau forest ecosystem in order to create a suitable basis for its conservation and management as a multiple asset system, to benefit local, national and international stakeholders). In Rwanda, the team has also been working with the Ministry of Infrastructure to developing a sustainable charcoal production CDM Programme of Activities.

REDT Clean Energy Storage

REDT Clean Energy Storage, our joint venture in which we have a 49.8% economic interest, also has had a transformational year which culminated in the award of the £3.6m contract to build a 1.26MWh utility storage facility on the island of Gigha, Scotland designed to demonstrate a cost effective solution for the UK grid and to benefit long term energy prices in the UK and elsewhere. This followed the successful installation of a demonstration flow battery system in Evora, Portugal which has a 5kW rated power with 12 hours (60kWh) storage capacity.

REDT has developed a robust, reliable and low maintenance energy storage system following more than ten years of research. The REDT battery can be used for a number of applications including increasing the reliability of renewable energy or for off grid energy solutions and comes in a range of power and storage capacities so can be easily integrated with a range of energy systems.

Key features of the renewable energy storage system are:

· Long Lasting - the system can handle up to 10,000 cycles, matching the life of a typical renewable energy system.

· Super-Efficient - the system retains charge indefinitely when shut down and can discharge down to 0% and charge up to 95% without causing degradation.

· Safe - Non-flammable and non-explosive as result of the patented low pressure system design.

· Environmentally Friendly - No emissions or heavy metals.

· Low Maintenance - the systems only requires annual maintenance checks, and performance can be monitored remotely.

The system in Evora, Portugal will be used to maximise the efficiency of a 6.6kW PV array that has been installed on the roof of the building and will time shift energy with voltage and frequency control so that energy costs are reduced. The system is capable of delivering a high quality domestic 2kW load for 2 to 3 days during periods of low solar output. REDT was selected by the European Commission to build and supply its new flow battery system for the Photovoltaic Cost reduction, Reliability, Operational performance, Prediction and Simulation ("PVCROPS") project, which is administered out of the Polytechnica University of Madrid and is part of the EU Seventh Framework Programme ("FP7").

The objectives of the PVCROPS project are to develop improved methodology, management, efficiency and cost reduction for renewable energy generated from solar PV installations. REDT is working collaboratively on this project with 11 other academic and industry partners from across Europe. This project offers REDT an excellent opportunity to prove its Vanadium Redox Flow Battery ("VRFB") systems in conjunction with the most influential organisations in the European PV industry, and the potential for additional sales volume in this sector throughout Europe with the same partners.

Work has started in earnest on delivering the Gigha project with our partners with first funds drawn down on budget on the project. Our proposed 1.26MWh storage system will be located on the island of Gigha, situated a few miles off the Kintyre peninsula, and with limited connection to the mainland via an ageing subsea cable.

One of the UK's largest opportunities for energy storage lies in Scotland which has a target to produce the equivalent of 100% of electricity from renewables by 2020 and estimates that 7GW of storage could be required by 2030. The REDT energy storage demonstration will focus on one of the weakest areas of the UK grid in the highlands and islands of Scotland where there are significant network constraints - these are the same areas that have such excellent potential for renewable energy generation. These costly-to-alleviate constraints prevent timely and efficient transfer of clean energy to demand customers, place hurdles on national ambition - and represents a great opportunity for REDT products in the UK market and around the world. 

Generation and distribution issues to be addressed on Gigha include storage of 'wrong time' wind energy produced by the established wind farm on the island and despatch at peak rates, peak shaving and power regulation, deferral of capital upgrades of over-utilised transmission assets, potential standby power for the island during network faults or power outages, and enabling a minimum 20% increase in wind and solar generation with associated additional income for the island.

The National Grid has an ever increasing need for balancing power to handle wind variability in the UK. The present practice of curtailing wind energy output at times of high output and low demand is costly and ineffective which is ultimately paid for by consumers.

Due to its variability, renewable generation cannot yet be directly compared with conventional generation. REDT flow battery storage has the potential to bring renewable generation into the mainstream, enabling UK energy storage targets to be met and ultimately fixing long term generation costs using clean and free natural fuel.

EU ETS compliance services

The EU ETS compliance services team works with installations covered by the ETS to help them manage their regulatory position. This consists of providing market updates and supplying the requisite number of allowances and offsets for them to meet their emissions obligations, or selling their surplus. Where possible offsets are sourced from the Company's portfolio, from which these installations have historically been buyers. The team also manages the legacy business associated with this portfolio.

CDM carbon business

As indicated in our annual report for 2012, we moved rapidly in 2013 to hibernate our CDM carbon business to avoid further downside risk from the collapse in the CER price which fell 96% in 2012 and barely recovered in 2013. That process was effectively completed through 2013 culminating in a reorganisation involving the disposal of 5 group entities which together held the majority of the Group's provided liabilities and all its contingent liabilities. The hibernation process involved the effective closure of the China office with associated headcount reduction in the region and elsewhere and I wish to take this opportunity of thanking those staff members that have left us for their efforts during their time with the business and for their patience and understanding as we have worked through this situation and those who remain with us for their tireless work and professionalism to protect the ongoing business.

Notwithstanding the CER price fall, we did manage to earn some net carbon gross margin in 2013 which broadly covered the operating expenditure of this area as we worked to wind down the operation. We do not however anticipate a further material contribution in 2014 and beyond.

In these financial statements for 2013 we have recorded a restructuring provision to address the final costs anticipated in closing out this part of the business.

Other activity

On 7 May 2013 the Group sold its entire 60.1% interest in Camco South East Asia Limited for consideration of $6.01m in cash, the same as the book value attributed to the holding in 2012. The funds received were used to fund the acquisition of the Twin Falls Facility and for other working capital purposes to exploit the opportunities available in the remaining business units.

Scott McGregor

Chief Executive Officer

Chief Financial Officer's Report

Overall Group result

The Group reported a significantly reduced total comprehensive loss of €3.8m compared to a loss of €23.2m in 2012 and reported a gross profit of €7.0m compared to a gross profit of €0.1m in 2012.

Gross profit for the carbon business was €3.9m (2012: loss of €2.6m) and gross profit for the projects business was €3.1m (2012: €2.7m).

Revenue rose to €12.3m compared to revenue in 2012 of €6.5m (after taking account of the 2012 carbon fair value adjustment). Revenue for the carbon business was €6.7m (2012: €1.5m after taking account of the 2012 carbon fair value adjustment) and revenue for Projects was €5.6m (2012: €5.0m).

Cost of sales reduced to €5.3m compared to €6.5m in 2012. Cost of sales for the carbon business was €2.8m (2012: €4.1m) and cost of sales for Projects was €2.5m (2012: €2.3m).

Carbon segment

The Carbon segment comprises our CDM carbon business, our US Carbon business and the EU ETS compliance services business.

CDM carbon business

The CDM Carbon business (comprising Certified Emission Reduction units ("CERs") and Voluntary Emission Reduction Units ("ERUs")) recorded revenue of €4.0m in 2013 of which €1.6m related to the unwinding of CER/VER carbon balances held on the balance sheet at the end of 2012 and the remaining €2.4m related to direct activity in 2013. This segment recorded Cost of Sales of €0.2m of which €(0.9)m related to the unwinding of CER/VER carbon balances referred to above and the remaining €1.1m related to direct activity in 2013. This resulted in a gross profit from direct activities in 2013 of €1.3m, the majority of which was represented by cash receipts.

As we have set out at length in this report and previously, the nature of wider CER/VER market means that we are not expecting meaningful revenues in this business to be repeated for 2014 and beyond.

The following table sets out the value of the net CER/VER carbon balances included within Group assets as at 2013 and for prior years 2010-2012:

At the end of 2012, the CER Carbon business had an effective net liability position of €5.2m having reduced from a positive value of €5.7m in 2011 and €29.6m in 2010. In addition, at the date of signing the 2012 financial statements in June 2013, a number of fixed price CER carbon purchase agreements were held in various entities across the Group. As a result of the significant decline in the carbon price in 2011 and 2012, these fixed price contracts resulted in a then potential un-provided potential exposure across the Group of €20.7 million. This exposure, which was being experienced across the industry, arose where entities are required to purchase carbon credits under fixed price purchase agreements at a price that is higher than the current market price at which those entities can sell the carbon credits.

As stated in the 2012 financial statements, the Directors considered that they had made adequate provision in those accounts for the costs that were likely to be borne and we are pleased to report that in these 2013 financial statements the Group no longer has potential un-provided exposure to such fixed price CER carbon purchase agreements. This has been achieved through either contract renegotiations or through a reorganisation at the end of 2013 which resulted in various entities across the Group holding certain fixed price CER carbon purchase agreements beingdisposed for nominal consideration.

At the end of 2013, the potential provided net liability had reduced from €5.2m to €1.0m, a reduction of €4.2m. €0.8m of this reduction resulted from the disposals referred to above with the remaining €3.4m due to diligent work in reducing the net liability position. The Directors will continue to work diligently in reducing the remaining potential provided net liability of €1.0m.

US Carbon

The US Carbon business recorded revenues of €0.8m and cost of sales of €0.6m giving a gross profit of €0.2m. The intangible asset (carbon in specie) balance of €0.3m as at 2012 relating to certain ODS (Ozone Depleting Substances) credits formed part of this cost of sales balance in 2013 as did the revenue of €0.4m received on their sale.

The remaining revenue and cost of sales relates to the sale of credits delivered from the agricultural methane projects for which CCOs had been issued under California Program. In general, the first issuances under California Program have mainly been focused on credits under the Ozone Depleting Substances methodology with those under agricultural methane methodology only starting to be issued as CCOs towards the end of 2013. The majority of our agricultural methane methodology credits had not had CCOs issued by the end of 2013 but we do expect them to all have first issuances during 2014.

EU ETS compliance services

The EU ETS compliance services business generated a small net margin during the year from revenue and cost of sales of approximately €2.0m each. This small net margin is as expected given the nature of the activity but provides a useful additional cash flow which is expected to be more meaningful in 2014.

Projects segment

The Projects segment comprises our US Clean Energy projects business (being the Jerome Facility and Twin Falls Facility), the Africa Clean Energy Consulting business and other miscellaneous activities.

US Clean Energy projects business

The Jerome Facility was owned and operating for the entire year whereas the Twin Falls Facility was acquired on 20 December 2013 and was only held by the Group for 11 days in 2013.

Revenue for the Jerome Facility was $3.2m (€2.3m) and other income was $0.4m (€0.3m) reflecting the amortization of deferred income in connection with the grant received in 2012. As expected we did see seasonality in the revenue from power generated with the second half of the year benefiting from the higher prices set out in the power purchase agreement. Cost of sales were $1.1m (€0.8m). Administration Expenses were $1.4m (€1.0m) which includes depreciation of $1.2m (€0.8m). Interest expense for the year was $1.0m (€0.8m).

At the beginning of 2013, a loan of $14.9m (€11.2m) was secured against the Jerome Facility and this had amortized to $14.3m (€10.4m) at the end of 2013. The Deferred Income balance at the beginning of 2013 of $6.3m (€4.8m) had amortized to $5.9m (€4.3m). Project Plant & Equipment had also reduced from $19.6m (€14.9m) to $18.5m (€13.4m) through depreciation. Finally, the Jerome Facility also had access to cash and restricted cash of $1.5m (€1.1m) (2012: $1.6m (€1.2m)) in total.

On 20 December 2013 the Twin Falls Facility was acquired for gross consideration of $2.9m (€2.1m) equating to net consideration of $2.7m (€2.0m). The acquisition has been accounted for as a business combination and the full value of the net consideration reflected in project plant and equipment at the end of 2013. The income received in 2013 from the Twin Falls Facility was a nominal amount for the 11 days of the year that it was held by the Group.

Africa Clean Energy Consulting business

The Africa Clean Energy Consulting business includes the 5 offices in Africa, the principle ones being Dar es Salaam (Tanzania), Johannesburg (South Africa) and Nairobi (Kenya).

Revenue for the year was €2.9m (2012: €2.5m) and cost of sales was €1.6m (2012: €1.2m). Administration expenses were €1.2m (2012: €1.3m). In addition, there was a €0.1m impairment of receivables. At the end of the year, the Africa Clean Energy Consulting business had work in progress of €0.5m (2012: €0.6m), deferred income of €0.2m (2012: €0.1m) and direct project cost accruals of €0.2m (2012: €0.2m).

Group operating expenses

Overall administration expenses fell by €3.1m from €12.4m to €9.3m, a fall of 25% following a concerted effort to reduce operational costs. Administration expenses include a full year's cost for the Jerome Facility of €1.0m compared with a 6 month charge in 2012 of €0.5m and a 2013 non-cash charge for share based payments of €0.4m (2012: €Nil).Excluding the expenses in connection with the Jerome Facility and the share based payments charge, administration expenses fell by €4.0m from €11.9m to €7.9m, a fall of 34%. Noticeable reductions came from personnel and contractors of 16% (€5.3m (2012: €6.3m), office costs 41% (€1.0m (2012: €1.7m), professional costs (including non-executive director fees) 42% (€1.1m (2012: €1.9m), and travel and marketing 43% (€0.4m (2012: €0.7m).

The efforts to reduce such operational cost have been focused on China (€1.1m (2012: €2.1m), US (€1.7m (2012: €2.3m) and Group/other (€3.9m (2012: €6.1m) (all excluding the Jerome Facility and the share based payments charge) which combined shows a fall of 36%. Administration expenses across our African Clean Energy Consulting business also fell by €0.1m from €1.3m to €1.2m, a fall of 8%.

Year on year operational costs are expected to fall further in 2014 which will show the full year impact of the efforts to reduce cost in 2013. This is particularly the case in China where operational costs are expected to be negligible in 2014.

In addition to the above expenses, the Group recorded a restructuring charge of €0.8m (2012: €0.1m), a gain on disposals of €1.4m (2012: €Nil), impairment of receivables €0.1m (2012: €1.2m). In 2013 there was no impairment of investment in associates and joint ventures (2012: €3.1m), no impairment of goodwill (2012: €0.4m) and impairment of development costs €0.1m (€2.5m).

€0.8m of the gain on disposal reflects the disposal of certain entities as part of the reorganisation at the end of 2013. These entities were disposed for nominal consideration and had a net liability position at the point of disposal which created this gain. The remaining gain on disposal of €0.5m reflects the disposal of Camco South East Asia Limited but should be considered again the equal and opposite share of loss recorded for this entity before the date of disposal.

Cash and cash equivalents

At 31 December 2013, the Group had cash and cash equivalents of €4.5m (2012: €11.1m) with unsecured loans of €Nil (2012: €4.0m). Adjusting for the unsecured loan in 2012 gives an adjusted net cash position at the year-end of €4.5m (2012: €7.1m) as follows:

The adjusted net cash position includes cash held in a debt reserve in relation to the Jerome Facility of €1.0m (2012: €1.0m) which is not available to the Group for general working capital purposes.

The key movements in cash during 2013 were: the repayment of borrowings (€4.7m); receipt of proceeds from the sale of investments (€4.4m) including the sale of Camco South East Asia; net acquisition of plant, property & equipment (€0.7m) which includes the purchase of the Twin Falls Facility (€2.0m) and the disposal of certain other assets (€1.2m); interest paid (€0.8m); loans to joint ventures being REDH (€0.2m); proceeds from the issue of share capital (€0.3m) and a cash absorbed from operations (€4.5m).

On 27 June 2014, the Company announced that it was raising €1.25 million through the issue of 25,000,000 new ordinary shares at 4.0 pence (approximately €0.05) per share to new and existing investors ("Placing"). In addition, the Company announced an open offer to existing shareholders to raise up to an additional €0.65m through the issue of up to 13,007,947 ordinary shares at 4.0 pence per share ("Open Offer").

Both the Placing and the Open Offer are subject to the approval of shareholders at the General Meeting proposed to be held on 15 July 2014.

Other Activities

On 7 May 2013 the Group sold its entire 60.1% interest in Camco South East Asia Limited to Khazanah Nasional Berhad for consideration of $6.01m in cash. The Group's interest in Camco South East Asia Limited had a book value of $6.01m as at 31 December 2012. In the period leading up to the disposal on 7 May 2013, the Group's share of loss in Camco South East Asia Limited was €0.5 which is recorded in the Consolidated Statement of Comprehensive Loss but offset by an equivalent gain on disposal with no net impact on the overall group result.

On 13 May 2013 the Group announced that it had agreed to issue 18,449,073 new ordinary shares to Khazanah Nasional Berhad at 1.138 cents per share (1.183 pence) raising €254,875 (£218,252).

Jonathan Marren

Chief Financial Officer

Consolidated Statement of Financial Position

at 31 December 2013

Consolidated Statement of Comprehensive Income

for the year ended 31 December 2013

Consolidated Statement of Changes in Equity

for year ended 31 December 2013

Consolidated Statement of Changes in Equity

for year ended 31 December 2012

Consolidated Statement of Cash Flow

for year ended 31 December 2013

Notes

1 Accounting policies

Camco Clean Energy plc (the "Company") is a public company incorporated in Jersey under the Companies (Jersey) Law 1991. The address of its registered office is Channel House, Green Street, St Helier, Jersey JE2 4UH. The consolidated financial statements of the Company for the year ended 31 December 2013 comprise of the Company, its subsidiaries and associates and jointly controlled entities (together the "Group"). The Company is admitted to the AIM, a market operated by London Stock Exchange Plc.

A Statement of compliance

These consolidated financial statements have been prepared and approved by the Directors in accordance with International Financial Reporting Standards as adopted by the European Union ("adopted IFRS").

These consolidated financial statements have been prepared in accordance with and in compliance with the Companies (Jersey) Law 1991 an amendment to which means separate parent company financial statements are not required.

B Basis of preparation

The financial statements are presented in Euros, the functional currency of the Company, rounded to the nearest thousand Euros.

The preparation of financial statements in conformity with adopted IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the year in which the estimate is revised if the revision affects only that year, or in the year of the revision and future years if the revision affects both current and future years. The most significant techniques for estimation are described in the accounting policies below.

The accounting policies set out below have been applied consistently in the year and presented in these consolidated financial statements. The accounting policies have been consistently applied across all Group entities for the purposes of producing these consolidated financial statements.

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

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Financial Review. The financial position of the Group, its cash flows and liquidity position are described in the same review.

The Group has sufficient financial resources together with long-term relationships with a number of customers across different geographical areas and industries. The Group also announced on 27 June 2014 that it was raising €1.25 million through the issue of 25,000,000 new ordinary shares at 4.0 pence (approximately €0.05) per share to new and existing investors ("Placing"). In addition, the Company announced an open offer to existing shareholders to raise up to an additional €0.65m through the issue of up to 13,007,947 ordinary shares at 4.0 pence per share ("Open Offer"). As a consequence, the Directors believe that the Group is well placed to manage its business risks successfully.

The Directors are satisfied that the Group has adequate resources to continue to operate for the foreseeable future. For this reason, they consider it appropriate for the financial statements to be prepared on a going concern basis.

C Accounting for Carbon Development Contracts ("CDCs")

The Group enters into CDCs with clients from which carbon credits are received. Carbon credits under the Kyoto Protocol, also known as Certified Emission Reductions ("CERs") or Emission Reduction Units ("ERUs") are generated through the highly regulated Carbon Development Mechanism ("CDM") and Joint Implementation ("JI") processes respectively. These follow a number of steps including the approval of the project methodology and monitoring procedures, project design, project approval by the Designated National Authority ("DNA"), project validation by a Designated Operational Entity or equivalent ("DOE"), project acceptance by the host country, registration, verification and certification by a DOE. Verification of carbon credit production normally takes place at least once a year during the crediting period. The Group works with the client at all stages of the process using proprietary knowledge and experience to negotiate this complex process. Carbon credits are also generated outside the Kyoto Protocol under voluntary or regional emission reduction schemes.

Revenue recognition on CDC consultancy services

The Group derives revenue from the provision of consultancy services to carbon project clients under CDCs. The Group receives payment for the services by either cash commission or non-cash carbon credit. Revenue from CDCs is only recognised once the Group's services to secure the production of carbon credits are significantly complete and receipt of the consideration, be it cash or carbon credits, can be forecast reliably. Revenue is recognised once a CDC is registered by a DOE (where payment is due to Camco irrespective of a CDC's registration this criteria will not apply) and Camco has provided significantly all of its services.

The timing of revenue collection is uncertain as carbon credits may be generated over subsequent years as they are issued. The amount and timing of commission or carbon credits to be received may be dependent upon the number of carbon credits received by the customers, which is determined by assessing the specific technical, contract and economic risks identified on the project.

Revenue is recognised at the fair value of the consideration receivable from the contracts, at which point accrued income is recognised. If a CDC will result in a probable net outflow of economic benefit from the Group then this amount will be recognised in accrued expenses. The fair value is the estimated net value of the carbon credits to be received, which is dependent upon the expected number to be delivered and the intrinsic value. If the expected number or value of the carbon credits subsequently changes an adjustment is made to the accrued income balance with an associated credit or debit taken to revenue. The unwinding of any financing element of accrued income is recognised as finance income or expense.

The CDCs are scheduled to deliver of carbon credits under Clean Development Mechanism and other regional schemes until at least 2020. The Group and Company has taken advantage of the own use exemption in relation to carbon credits and as such does not account for the contract under IAS 39 and 32.

Treatment of CDC costs

CDC costs are presented under current assets as work in progress. CDCs acquired by the Group are recorded initially at cost (or fair value if through business combination).

Subsequently, the directly attributable costs are added to the carrying amount of CDCs. These costs are only carried forward to the extent that they are expected to be recouped through the successful completion of the contracts. The costs comprise consultancy fees, license costs, technical work and directly attributable administrative costs. All other costs are expensed as incurred. CDC costs carried as work in progress are stated at the lower of cost and net realisable value.

Once the revenue recognition criteria on these contracts are met the CDC costs incurred on them are expensed in full. Accrued income is derecognised when cash is received either as commission or in respect of sales of carbon credits or rights to carbon credits receivable under the CDC consultancy contracts.

D Revenue recognition on other consultancy services

Advisory revenue from consultancy services provided is recognised in the income statement in proportion to the stage of completion of the consultancy contract. The stage of completion is assessed by reference to the overall contract value.

Project revenue consists of development fees, management service fees and revenue derived directly from projects where Camco holds an ownership interest.

E Revenue Recognition on project related income

The Group also derives revenue from its US clean energy projects from the sale of electricity, fibre and renewable energy certificates ("RECs"). Electricity is sold under a long-term Power Purchase Agreement ("PPA") and the revenue recognised when electricity is delivered to the transmission point for distribution. Fiber revenue is recognised upon production and delivery of the fibre and RECs are recognised when the renewable energy is generated. The fiber and REC's are sold under the terms of existing contracts.

F Intangible assets

Carbon in specie The Group has a number of carbon credit registry accounts used to receive carbon credits from its projects. These carbon credits are either transferred to buyers under existing sales contracts or, in the case of in specie consideration to the Group, sold for cash. Carbon credits held at the balance sheet date are recognised as an intangible asset and valued at the relevant market price or contract price.

G Property, plant and equipment

Computer and office equipmentComputer and office equipment is held at historical cost less accumulated depreciation and impairment losses. Depreciation is charged to the income statement on a straight line basis over the estimated useful life of three years.

Leasehold improvements Leasehold improvements are held at historical cost less accumulated depreciation and impairment losses. Depreciation is charged to the income statement on a straight line basis over the remaining life of the lease.

Construction in Progress items are held at historical cost and are depreciated from the date the asset is completed and ready for use.

Project plant and equipment Project plant and equipment is held at historical cost less accumulated depreciation and impairment losses. Depreciation is charged to the income statement on a straight line basis over the estimated useful life of the asset.

H Investments in subsidiaries

Investments in subsidiaries are carried at cost less provision for impairment.

I Impairment

The carrying amounts of the Group's property, plant and equipment, goodwill and other intangibles are reviewed at least annually to determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated. For assets that have an indefinite useful life the recoverable amount is estimated at each balance sheet date.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised immediately in the income statement. The recoverable amount is the greater of the fair value less cost to sell and the value in use. Value in use is calculated as the present value of estimated future cash flows discounted using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro-rata basis. A cash-generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

An impairment loss is reversed when there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used to determine the recoverable amount, only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined net of depreciation and amortisation, if no impairment loss had been recognised. An impairment loss in respect of goodwill on acquisition is not reversed.

J Non-current assets held for sale and discontinued operations

A non-current asset or a group of assets containing a non-current asset (a disposal group) is classified as held for sale if its carrying amount will be recovered principally through sale rather than through continuing use, it is available for immediate sale and sale is highly probable within one year.

On initial classification as held for sale, non-current assets and disposal groups are measured at the lower of previous carrying amount and fair value less costs to sell with any adjustments taken to profit or loss. The same applies to gains and losses on subsequent remeasurement although gains are not recognised in excess of any cumulative impairment loss. Any impairment loss on a disposal group first is allocated to goodwill, and then to remaining assets and liabilities on pro rata basis, except that no loss is allocated to inventories, financial assets, deferred tax assets, employee benefit assets and investment property, which continue to be measured in accordance with the Company's accounting policies. Intangible assets and property, plant and equipment once classified as held for sale or distribution are not amortised or depreciated.

A discontinued operation is a component of the Company's business that represents a separate major line of business or geographical area of operations that has been disposed of or is held for sale, or is a subsidiary acquired exclusively with a view to resale. Classification as a discontinued operation occurs upon disposal or when the operation meets the criteria to be classified as held for sale, if earlier. When an operation is classified as a discontinued operation, the comparative income statement is restated as if the operation has been discontinued from the start of the comparative period.

K Foreign exchange

Foreign currency transactions  

Transactions in currencies different from the functional currency of the Group entity entering into the transaction are translated at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the income statement. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the foreign exchange rate at the date of transaction.

L Available-for-sale financial assets

The Group's investments in equity securities are classified as available-for-sale financial assets. Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment losses, and foreign exchange gains and losses on available-for-sale monetary items, are recognised directly in equity. When an investment is derecognised, the cumulative gain or loss in equity is transferred to profit or loss.

M Cash and cash equivalents

Cash and cash equivalents in the balance sheet comprise cash at bank and in hand and short-term deposits with an original maturity of three months or less. For the purposes of the cash flow statement, cash and cash equivalents comprise cash and short-term deposits as defined above and other short-term highly liquid investments that are readily convertible into cash and are subject to insignificant risk of changes in value, net of bank overdrafts.

N Taxation

Tax on the profit or loss for the year comprises current and deferred tax. Tax is recognised in the income statement except to the extent that it relates to a business combinations, or items recognised directly in equity, or in comprehensive income.

Current tax is the expected tax payable or recoverable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to the tax payable in respect of previous years.

O Earnings per share

The Group presents basic and diluted earnings per share ("EPS") data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the year.

Diluted EPS is determined by adjusting the profit or 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 convertible notes and share options granted to employees.

P Provisions

A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefit will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Q Accrued income on carbon credits

The Group derives revenue from (CCOs) California Carbon Offset Credits that are generated through its US Biogas Operations. The policy is to recognise value for the credits generated during the period once a project has been registered and issued its first offsets under a California Air Resources Board (ARB) approved offsets protocol. To be registered and issued offsets, the project must go through a process of being verified by an approved body and only once this has been carried out successfully does the Group have reasonable certainty that credits generated during each year will be issued at the end of that year in relation to the project. The value placed on the credits is based on the contracted price Camco will receive, or if the credits are not sold, the prevailing market rate.

R Government grant

In August 2012, a federal grant was received from the United States in connection with a project asset. The grant was recognised as deferred income at fair value as there was reasonable assurance that all conditions associated with the grant would be complied with. The revenue is then recognised in the profit and loss as project revenue on a systematic basis over the useful life of the asset.

The grant is reimbursable to the United States Department of Treasury if the asset is disposed of to a disqualified person or ceases to qualify as a specified energy project within five years from the date the property is placed in service.

S Leased assets

Payments made under operating leases are recognised in the profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.

Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Contingent lease payments are accounted for by revising the minimum lease payments over the remaining term of the lease when the lease adjustment is confirmed.

Determining whether an arrangement contains a lease

At inception of an arrangement, the Group determines whether such an arrangement is or contains a lease. A specific asset is the subject of a lease if fulfilment of the arrangement is dependent on the use of that specified asset. An arrangement conveys the right to use the asset if the arrangement conveys to the Group the right to control the use of the underlying asset.

At inception or upon reassessment of the arrangement, the Group separates payments and other consideration required by such an arrangement into those for the lease and those for other elements on the basis of their relative fair values. If the Group concludes for a finance lease that it is impracticable to separate the payments reliably, then an asset and a liability are recognised at an amount equal to the fair value of the underlying asset. Subsequently the liability is reduced as payments are made and an imputed finance charge on the liability is recognised using the Group's incremental borrowing rate.

T Finance income and expense

Finance income comprises interest income on surplus funds, unwinding of the discount on provisions and accrued costs. Interest income is recognised as it accrues in the profit or loss using the effective interest method.

Finance expenses comprise interest expense on borrowings, finance leases and unwinding of the discount on provisions and accrued costs. All borrowing costs are recognised in the profit or loss using the effective interest method.

Foreign currency gains and losses arising from a group of similar transactions are reported on a net basis.

U Non-derivative financial liabilities

The Group has the following non-derivative financial liabilities: loans and borrowings, bank overdrafts, trade and other payables and payments on account. Such financial liabilities are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition these financial liabilities are measured at amortised cost using the effective interest method.

V Prior year restatement

During the year, the Company adjusted the classification of the US Government Grant received in 2012. In 2012, the grant was classified as deferred income within Current liabilities. Subsequent to the adjustment, €4,489,000 of the deferred income balance has been reclassified to Non-current liabilities.

In 2013, a decision was taken by management to disclose income from the US Government Grant separately. In the Consolidated Statement of Comprehensive Income, €118,000 was reclassified from Revenue to Other Income in 2012.

In 2013, management took the decision to disclosure separately in the Cash Flow Statement, the loan to its Joint Venture. This resulted in a reclassification of €91,000 in 2012 to Loans to Joint Ventures.

2 Segmental reporting

The financial information in these Report and Accounts split our operations into two segments, being Carbon and Projects. Given the growth potential of the business units within Projects and the focus generally away from carbon activity, the Board may in the future, look to report its operations on a different segmental basis.

Operating segments

The Group comprises of the following two reporting segments:

1. Carbon: The Carbon Project Development teams provide CDC consultancy services on carbon asset development, commercialisation and portfolio management.

2. Projects: The Clean Energy Project Development teams collaborate with industry, project developers, equipment providers and investor groups to create emissions-to-energy projects and maximise sustainable energy production across a range of industries; including agricultural methane, industrial energy efficiency, coal mine methane, municipal solid waste, biomass and landfill gas. The teams also provide consultancy services with respect to the clean energy sector.

Inter segment transactions are carried out at arm's length.

Group also views its business geographically: EMEA (including Europe, Middle East and Africa), ASIA (China and South East Asia), and North America (mainly USA)

In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of its customers, segment assets are based on the geographical location of the asset.

Geographical information

The Group derives carbon revenue from the provision of consultancy services to carbon clients under CDCs as well as EU ETS compliance services, where the Group works with clients covered by the ETS to help them manage their regulatory position. With respect to this carbon revenue, the geographic analysis has been prepared based on the geographic location of the project that will generate the carbon credits. This location is not the geographic location of the carbon credit buyer and not necessarily where the services were performed.

3 Revenue

Due to the carbon price fall in 2012 the accrued income balance was reduced by €9.2m for floating price and unsold contracts. There was no such adjustment required in 2013 as a result of there being no unsold contracts recorded in accrued income at the start of the year.

4 Other income

Net Gain on Disposal of Investment

On 7 May 2013 the Group sold its entire 60.1% interest in Camco South East Asia Limited, resulting in a gain on disposal of €547,000.

In November 2012, the Group disposed of its investment in Hekai Ventures, resulting in a gain on disposal of €3,000.

Net Gain on Disposal of subsidiaries

In December 2013, the Group disposed of 95% of its shareholding in Camco Advisory Services (Hong Kong) Limited resulting in a gain on disposal of €762,000.

Prior to the sale, the ownership of four of the Group's subsidiary special purpose companies were transferred from the Company to Camco Advisory Services (Hong Kong) Limited. All assets and liabilities held by these companies were disposed of upon completion of the sale.

Camco Advisory Services (Hong Kong) Limited was sold for $14. The special purpose companies transferred to Camco Advisory Services (Hong Kong) Limited were together in net liability positions at the date of disposal, therefore resulting in a gain on disposal recognised in the Group's Statement of Comprehensive Income.

5 Expenses and auditor's remuneration

Included in comprehensive income are the following:

The restructuring charges above relate to China operations and carbon segments.

Services provided by the Group's auditor:

During the year the Group obtained the following services from the Company's auditor, KPMG LLP:

6 Staff numbers and costs

The average number of persons employed by the Group (including Directors) during the year, analysed by category, was as follows:

The aggregate payroll costs of continuing operations were as follows:

7 Loss per share

Loss per share attributable to equity holders of the Company is calculated as follows:

8 Acquisition

On 20 December 2013, the Group completed the acquisition of the Twin Falls Facility from Cargill Incorporated, for a combined 100% interest. Total net consideration under the Sale and Purchase Agreement was €1.97 million ($2.7 million). The entire consideration was settled in cash.