Riverfort Regulatory News (RGO)

Paternoster Resources plc:

Nicholas Lee, Chairman

+44 20 7580 7576

Nominated Advisor and Joint Broker:

Westhouse Securities

Antonio Bossi / Paul Gillam

+44 20 7601 6100

Joint Broker:

Peterhouse Capital Limited

Jon Levinson

+44 20 7562 3351

Category

Investment

Cost or valuation (£)

Unlisted/pre IPO

Bison Energy Services Limited

170,597

Listed special situations

Brady Exploration plc, Leed Resources plc and Astar Minerals plc

309,493

Listed value opportunities

Xstrata plc, Tullow Oil plc, Quadrise Fuels International plc, Cairn Energy plc, Ophir Energy plc, BG Group plc and Red Rock Resources plc

719,518

Total investment portfolio

1,199,608

Cash

1,454,495

Total

2,654,103

COMPANY STATISTICS

31 December

2012

31 December

2011

Change %

Net asset value

£2,656,343

£2,168,091

+23%

Net asset value - fully diluted per share

0.43p

0.36p

+20%

Closing share price

0.31p

0.50p

-38%

Share price (discount)/premium to net asset value - fully diluted

(28%)

39%

Market capitalisation

£1,791,000

£2,889,000

-38%

2012

2011

Restated

Note

£

£

CONTINUING OPERATIONS:

Net gains on investments

4

690,806

1,085,573

Finance income

5

1,209

876

TOTAL INCOME

692,015

1,086,449

Operating expenses

6

(241,157)

(166,423)

Directors' severance payments

7

-

(226,000)

PROFIT BEFORE TAXATION

450,858

694,026

Taxation

10

(1,025)

1,391

PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS

449,833

695,417

Loss for the year from discontinued operations

11

-

(3,570)

PROFIT FOR THE YEAR AND TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT

449,833

691,847

EARNINGS PER SHARE

12

BASIC:

- Continuing operations

0.078p

0.198p

- Discontinued operations

0.000p

(0.001p)

- Total basic earnings/(loss) per share

0.078p

0.197p

FULLY DILUTED:

- Continuing operations

0.073p

0.198p

- Discontinued operations

0.000p

(0.001p)

- Total fully diluted earnings/(loss) per share

0.073p

0.197p

Share

capital

Share premium

Other reserves (Note 20)

Retained

losses

Total

equity

£

£

£

£

£

BALANCE AT 1 JANUARY 2011

3,285,796

1,852,339

27,000

(5,161,091)

4,044

Profit for the year and total comprehensive income

-

-

-

691,847

691,847

Issue of share capital

545,000

1,005,000

-

-

1,550,000

Share issue costs

-

(82,490)

-

-

(82,490)

Share based payment costs

-

-

4,690

-

4,690

Transactions with owners

545,000

922,510

4,690

-

1,472,200

BALANCE AT 31 DECEMBER 2011 (restated)

3,830,796

2,774,849

31,690

(4,469,244)

2,168,091

Profit for the year and total comprehensive income

-

-

-

449,833

449,833

Share based payment costs

-

-

38,419

-

38,419

Transactions with owners

-

-

38,419

-

38,419

BALANCE AT 31 DECEMBER 2012

3,830,796

2,774,849

70,109

(4,019,411)

2,656,343

Share

capital

Share premium

Other reserves (Note 20)

Retained

losses

Total

equity

£

£

£

£

£

BALANCE AT 1 JANUARY 2011

3,285,796

1,852,339

27,000

(5,194,574)

(29,439)

Profit for the year and total comprehensive income

-

-

-

715,399

715,399

Issue of share capital

545,000

1,005,000

-

-

1,550,000

Share issue costs

-

(82,490)

-

-

(82,490)

Share based payment costs

-

-

4,690

-

4,690

Transactions with owners

545,000

922,510

4,690

-

1,472,200

BALANCE AT 31 DECEMBER 2011 (restated)

3,830,796

2,774,849

31,690

(4,479,175)

2,158,160

Profit for the year and total comprehensive income

-

-

-

447,760

447,760

Share based payment costs

-

-

38,419

-

38,419

Transactions with owners

-

-

38,419

-

38,419

BALANCE AT 31 DECEMBER 2012

3,830,796

2,774,849

70,109

(4,031,415)

2,644,339

GROUP

COMPANY

2012

2011

restated

2012

2011

restated

Note

£

£

£

£

NON-CURRENT ASSETS

Investment in subsidiary undertakings

13

-

-

-

-

Investments held for trading

14

1,199,608

1,760,086

1,199,608

1,760,086

1,199,608

1,760,086

1,199,608

1,760,086

CURRENT ASSETS

Trade and other receivables

15

41,680

85,170

40,526

83,352

Cash and cash equivalents

16

1,454,495

375,659

1,441,177

357,940

1,496,175

460,829

1,481,703

441,292

TOTAL ASSETS

2,695,783

2,220,915

2,681,311

2,201,378

CURRENT LIABILITIES

Trade and other payables

17

39,440

52,824

36,972

43,218

39,440

52,824

36,972

43,218

NET ASSETS

2,656,343

2,168,091

2,644,339

2,158,160

EQUITY

Share capital

19

3,830,796

3,830,796

3,830,796

3,830,796

Share premium account

2,774,849

2,774,849

2,774,849

2,774,849

Capital redemption reserve

20

27,000

27,000

27,000

27,000

Share option reserve

20

43,109

4,690

43,109

4,690

Retained losses

(4,019,411)

(4,469,244)

(4,031,415)

(4,479,175)

TOTAL EQUITY

2,656,343

2,168,091

2,644,339

2,158,160

GROUP

COMPANY

2012

2011

2012

2011

Note

£

£

£

£

CASH FLOWS FROM OPERATING ACTIVITIES

Profit before taxation - continuing operations

450,858

694,026

447,760

715,399

Loss before taxation - discontinued operations

-

(3,570)

-

-

Share based payment expense

38,419

4,690

38,419

4,690

Dividend from subsidiary

-

-

-

(11,296)

Interest receivable

(1,209)

(876)

(1,174)

(731)

Profit on sale of investments

(690,806)

(1,085,573)

(690,806)

(1,085,573)

Increase in trade and other receivables

(20,982)

(76,592)

(21,646)

(77,791)

(Decrease)/increase in trade and other payables

(13,384)

5,829

(6,246)

5,210

(237,104)

(462,066)

(233,693)

(450,092)

Tax (paid)/received

(1,025)

1,391

-

-

NET CASH USED BY OPERATING ACTIVITIES

(238,129)

(460,675)

(233,693)

(450,092)

CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of investments

(1,185,435)

(674,513)

(1,185,435)

(674,513)

Disposal of investments

2,501,269

-

2,501,269

-

Dividend from subsidiary

-

-

-

11,296

Interest received

1,131

876

1,096

731

NET CASH FROM INVESTING ACTIVITIES

1,316,965

(673,637)

1,316,930

(662,486)

CASH FLOWS FROM FINANCING ACTIVITIES

Issue of shares

-

1,550,000

-

1,550,000

Share issue expenses

-

(82,490)

-

(82,490)

NET CASH FROM FINANCING ACTIVITIES

-

1,467,510

-

1,467,510

NET INCREASE IN CASH AND CASH EQUIVALENTS

1,078,836

333,198

1,083,237

354,932

Cash and cash equivalents at the beginning of the year

375,659

42,461

357,940

3,008

CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR

16

1,454,495

375,659

1,441,177

357,940

1

GENERAL INFORMATION

Paternoster Resources plc is a public limited company incorporated in the United Kingdom. The shares of the Company are listed on the AIM stock exchange. The address of its registered office is 31 Harley Street, London W1G 9QS. The Group's principal activities are described in the Directors' Report.

2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied throughout all periods presented in the financial statements.

As in prior periods, the Group financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. The financial statements have been prepared using the measurement bases specified by IFRS for each type of asset, liability, income and expense. The measurement bases are more fully described in the accounting policies below.

An overview of standards, amendments and interpretations to IFRSs issued but not yet effective, and which have not been adopted early by the Group are presented below under 'Statement of Compliance'.

CHANGE OF ACCOUNTING POLICY

The Group has early adopted "Investment Entities (Amendments to IFRS 10, IFRS 12, and IAS 27)" issued by the International Accounting Standards Board in October 2012. The effect of this accounting policy change is that the Group's investments which previously were all classified and designated as available for sale are classified as held for trading and designated as at fair value through profit or loss. As a result the income statement for 2011 has been restated to include unrealised fair value gains on investments in the income statement rather than in other comprehensive income, and the statement of financial position has been restated to include the unrealised fair value gains in retained earnings rather than in the investment reserve.

The impact of the change of accounting policy has been retrospectively applied in accordance with IAS 8 'Accounting Policies, Changes in Accounting Estimates and Errors'.

As a result of the voluntary accounting policy change, the following adjustments were made to the financial statements:

2011

As of and for the year ended 31 December 2011

£

Net gain on investments

1,085,573

Net increase in profit for the year from continuing operations

1,085,573

Net decrease in investment reserve

(1,085,573)

Net decrease in retained losses

1,085,573

GOING CONCERN

The directors have, at the time of approving the financial statements, a reasonable expectation that the Company and the Group have adequate resources to continue in existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the financial statements.

CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting year. These estimates and assumptions are based upon management's knowledge and experience of the amounts, events or actions. Actual results may differ from such estimates.

The only estimates and assumptions that may cause material adjustment to the carrying value of assets and liabilities relate to the valuation of unquoted investments. These are valued in accordance with the techniques set out in the accounting policy note "Investments held for trading"..

STATEMENT OF COMPLIANCE

The financial statements comply with IFRS as adopted by the European Union. At the date of authorisation of these financial statements the following Standards and Interpretations affecting the Company, which have not been applied in these financial statements, were in issue, but not yet effective. The company does not plan to adopt these standards early.

Effective for accounting periods beginning on or after:

IFRS 10

Consolidated Financial Statements - Identification of the concept of control of an entity and the requirement to include in consolidated accounts

1 January 2013

IFRS 12

Disclosure of Interests in Other Entities

1 January 2013

IFRS 13

Fair Value Measurement

1 January 2013

lAS 1 (amended)

Presentation of Items of Other Comprehensive Income

1 July 2012

lAS 12 (amended)

Deferred Tax: Recovery of Underlying Assets

1 January 2012

lAS 19 (revised)

Employee Benefits

1 January 2013

The Directors have not yet evaluated the effect of these standards on the financial statements.

BASIS OF CONSOLIDATION

The consolidated income statement and statement of financial position include the financial information of the Company and its subsidiary undertakings made up to 31 December 2012. Acquisitions of subsidiaries are dealt with by the purchase method. The purchase method involves the recognition at fair value of all identifiable assets and liabilities, including contingent liabilities of the subsidiary, at the acquisition date, regardless of whether or not they were recorded in the financial statements of the subsidiary prior to acquisition. On initial recognition, the assets and liabilities of the subsidiary are included in the consolidated statement of financial position at their fair values, which are also used as the bases for subsequent measurement in accordance with the Group accounting policies. Goodwill is stated after separating out identifiable intangible assets of the acquired subsidiary at the date of acquisition.

SEGMENTAL REPORTING

The accounting policy for identifying segments is now based on internal management reporting information that is regularly reviewed by the chief operating decision maker, which is identified as the Board of Directors.

In identifying its operating segments, management generally follows the Group's service lines which represent the main products and services provided by the Group. The Directors believe that the Group's continuing investment operations comprise one segment.

TAXATION

Current taxation is the taxation currently payable on taxable profit for the year.

Deferred income taxes are calculated using the liability method on temporary differences. Deferred tax is generally provided on the difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided on the initial recognition of an asset or liability unless the related transaction is a business combination or affects tax or accounting profit. Temporary differences include those associated with shares in subsidiaries and joint ventures and are only not recognised if the Group controls the reversal of the difference and it is not expected for the foreseeable future. In addition, tax losses available to be carried forward as well as other income tax credits to the Group are assessed for recognition as deferred tax assets.

Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is probable that the underlying deductible temporary differences will be able to be offset against future taxable income. Current and deferred tax assets and liabilities are calculated at tax rates that are expected to apply to their respective period of realisation, provided they are enacted or substantively enacted at the statement of financial position date. Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the income statement, except where they relate to items that are charged or credited to equity in which case the related deferred tax is also charged or credited directly to equity.

FOREIGN CURRENCY TRANSLATION

Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rates of exchange ruling at the statement of financial position reporting date. All exchange differences are dealt with through the profit or loss as they arise except where they arise from translation on consolidation, where they are recognised in other comprehensive income and reclassified to profit or loss on the disposal of the foreign operation.

FINANCIAL ASSETS

The Group's financial assets comprise available for sale investments, and cash and cash equivalents.

INVESTMENTS HELD FOR TRADING

All investments are designated upon initial recognition as held at fair value through profit or loss. Investment transactions are accounted for on a trade date basis. Assets are de-recognised at the trade date of the disposal. Assets are sold at their fair value, which comprises the proceeds of sale less any transaction cost. The fair value of the financial instruments in the balance sheet is based on the quoted bid price at the balance sheet date, with no deduction for any estimated future selling cost. Unquoted investments are valued by the directors using primary valuation techniques such as recent transactions, last price and net asset value. Changes in the fair value of investments held at fair value through profit or loss and gains and losses on disposal are recognised in the consolidated statement of comprehensive income as "Net gains on investments". Investments are initially measured at fair value plus incidental acquisition costs. Subsequently, they are measured at fair value in accordance with IAS 39. This is either the bid price or the last traded price, depending on the convention of the exchange on which the investment is quoted.

ASSOCIATED UNDERTAKINGS

Associated undertakings are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Investments that are held as part of the Group's investment portfolio are carried in the statement of financial position at fair value even though the Group may have significant influence over those companies. This treatment is permitted by IAS 28 "Investment in Associates", which requires investments held by a company as a venture capital provider to be excluded from its scope where those investments are designated, upon initial recognition, as at fair value through profit or loss and accounted for in accordance with IAS 39, with changes in fair value recognised in the statement of comprehensive income in the period of the change. The Group has no interests in associates through which it carries on its business.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise cash on hand and demand deposits, together with other short-term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

FINANCIAL LIABILITIES

The Group's financial liabilities comprise trade payables. Financial liabilities are obligations to pay cash or other financial assets and are recognised when the Group becomes a party to the contractual provisions of the instruments.

TRADE PAYABLES

Trade payables are initially measured at fair value and are subsequently measured at amortised cost, using the effective interest rate method.

SHARE-BASED PAYMENTS

All share based payments are accounted for in accordance with IFRS 2 - "Share-based payments". The Company issues equity-settled share based payments in the form of share options to certain directors and employees. Equity settled share based payments are measured at fair value at the date of grant. The fair value determined at the grant date of equity-settled share based payments is expensed on a straight line basis over the vesting period, based on the Company's estimate of shares that will eventually vest.

Fair value is estimated using the Black-Scholes valuation model. The expected life used in the model has been adjusted, on the basis of management's best estimate for the effects of non-transferability, exercise restrictions and behavioural considerations. At each balance sheet date, the Company revises its estimate of the number of equity instruments expected to vest as a result of the effect of non-market based vesting conditions. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to retained earnings.

DIVIDENDS

Dividend distributions payable to equity shareholders are included in "current financial liabilities" when the dividends are approved in general meeting prior to the statement of financial position date.

EQUITY

Equity comprises the following:

·; "Share capital" represents the nominal value of equity shares.

·; "Share premium" represents the excess over nominal value of the fair value of consideration received for equity shares, net of expenses of the share issue.

·; "Capital redemption reserve" represents the nominal value of shares repurchased or redeemed by the Company.

·; "Option reserve" represents the cumulative cost of share based payments.

·; "Retained losses" represents retained losses.

3

SEGMENTAL INFORMATION

The Group is organised around business class and the results are reported to the Chief Operating Decision Maker according to this class. There is one continuing class of business, being the investment in the natural resources sector.

Given that there is only one continuing class of business, operating within the UK no further segmental information has been provided.

4

NET GAINS ON INVESTMENTS

2012

2011

£

£

Net realised gains on disposal of investments

1,922,265

-

Unrealised gains/losses on investments:

(Gains)/losses at beginning of year

(1,085,573)

-

(Losses)/gains at end of year

(145,886)

1,085,573

Net gains on investments

690,806

1,085,573

5

FINANCE INCOME

2012

2011

£

£

Interest receivable

1,209

876

6

OPERATING EXPENSES

2012

2011

£

£

Operating expenses include:

Operating lease rentals

- land and buildings

-

3,000

AUDITOR'S REMUNERATION

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

2012

2011

£

£

Fees payable to the Company's auditor for the audit of the parent company and the Group financial statements

10,000

10,000

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

Other services relating to taxation

2,000

2,000

12,000

12,000

7

DIRECTORS' EMOLUMENTS

2012

2011

£

£

Aggregate emoluments

89,334

58,625

Directors' severance payments

-

226,000

Social security costs

5,246

5,315

Share based payment expense

38,419

4,690

132,999

294,630

Name of director

Fees

Benefits

Total

2012

Total

2011

£

£

£

£

N Lee

72,334

-

72,334

28,250

G Haselden

17,000

-

17,000

56,983

S J Wootliff

-

-

-

123,392

M Brink

-

-

-

36,000

D Thompson

-

-

-

25,000

J L Posner

-

-

-

5,000

KM Robinson

-

-

-

10,000

89,334

-

89,334

284,625

8

EMPLOYEE INFORMATION

2012

2011

£

£

Wages and salaries

89,334

55,233

Social security costs

5,246

5,315

Other benefits

-

3,392

Compensation payments

-

226,000

Share based payment expense

38,419

4,690

132,999

294,630

Average number of persons employed:

2012

2011

Number

Number

Office and management

2

2

COMPENSATION OF KEY MANAGEMENT PERSONNEL

There are no key management personnel other than the Directors of the Company.

9

SHARE BASED PAYMENTS

WARRANTS

In 2010 the Company issued warrants, each entitling the holder to subscribe in cash for one share at a price of 10p per share:

Number of

warrants at

1 Jan 2012

Issued

in the year

Exercised

in the year

Number of

warrants at

31 Dec 2012

Exercise

price

Vesting

Date

Expiry

date

2,125,000

-

-

2,125,000

10p

20.11.2011

20.11.2014

The Directors do not consider the fair value of warrants to be material to the Company accordingly a charge has not been recognised in accordance with IFRS.

EQUITY-SETTLED SHARE OPTION SCHEME

The Company operates share-based payment arrangements to remunerate directors and key employees in the form of a share option scheme. Equity-settled share-based payments are measured at fair value (excluding the effect of non-market based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Company's estimate of shares that will eventually vest and adjusted for the effect of non-market based vesting conditions.

On 26 October 2011, Nicholas Lee was granted options to subscribe for 28,000,000 new ordinary shares in the Company at an exercise price of 0.32p per share. The options are exercisable for a period of ten years from the date of grant, with one third becoming exercisable on the first, second and third anniversaries of the date of grant respectively.

On 13 March 2012, Nicholas Lee was granted options to subscribe for 14,000,000 new ordinary shares in the Company at an exercise price of 0.48p per share. The options are exercisable for a period of ten years from the date of grant, with one third becoming exercisable on the first, second and third anniversaries of the date of grant respectively. The fair value of these options was determined using the Black-Scholes option pricing model and was £0.22p per option.

The significant inputs to the model in respect of the options granted in 2012 and 2011 were as follows:

2012

2011

Grant date share price

0.48p

0.32p

Exercise share price

0.48p

0.32p

No. of share options

14,000,000

28,000,000

Risk free rate

3%

3%

Expected volatility

40%

40%

Option life

10 years

10 years

Calculated fair value per share

0.22p

0.15p

The total share-based payment expense recognised in the income statement for the year ended 31 December 2012 in respect of the share options granted was £38,419 (2011: £4,690).

Number of

options at

1 Jan 2012

Issued

in the year

Exercised

in the year

Number of

options at

31 Dec 2012

Exercise

price

Vesting

Date

Expiry

date

9,333,334

-

-

9,333,334

0.32p

26.10.2012

26.10.2021

-

4,666,667

-

4,666,667

0.48p

13.03.2013

13.03.2022

9,333,333

-

-

9,333,333

0.32p

26.10.2013

26.10.2021

-

4,666,667

-

4,666,667

0.48p

13.03.2014

13.03.2022

9,333,333

-

-

9,333,333

0.32p

26.10.2014

26.10.2021

-

4,666,666

-

4,666,666

0.48p

13.03.2015

13.03.2022

28,000,000

14,000,000

-

42,000,000

0.32p

10

INCOME TAX EXPENSE

2012

2011

£

£

Current tax - continuing operations

1,025

(1,391)

The tax on the Group's profit before tax differs from the theoretical amount that would arise using the weighted average rate applicable to profits of the Consolidated entities as follows:

2012

2011

£

£

Profit before tax from continuing operations

450,858

694,026

Profit/(loss) before tax multiplied by rate of corporation tax in the UK of 24.5% (2011: 26.5%)

110,460

(183,917)

Expenses not deductible for tax purposes

543

-

Brought forward tax losses utilised

(109,978)

182,526

Total tax

1,025

(1,391)

The operations of the Group have given rise to a realised capital gain in the year of £1,922,000. No provision for tax in respect of this gain is included in the accounts as the Directors believe that the Group has capital losses brought forward that exceed the current gain.

Unrelieved tax losses of £3,525,000 (2011: £3,220,000) remain available to offset against future taxable trading profits. No deferred tax asset has been recognised in respect of the losses as recoverability is uncertain.

11

DISCONTINUED OPERATIONS

The discontinued operations relate to the development of a commercial biofuel operation which was discontinued in 2011. The income and expenditure account and cash flows have been split between continuing and discontinued activities in accordance with IFRS 5 "Non-current Assets Held for Sale and Discontinued Operations".

2012

2011

£

£

Administrative expenses

-

(3,570)

Other income

-

-

Operating loss

-

(3,570)

Net finance income

-

-

Loss before taxation

-

(3,570)

Taxation

-

-

Loss for the year from discontinued operations

-

(3,570)

Net cash used by operating activities

-

-

Net cash from investing activities

-

-

12

EARNINGS PER SHARE

The basic earnings per share is based on the profit/(loss) for the year divided by the weighted average number of shares in issue during the year. The weighted average number of ordinary shares for the year ended 31 December 2012 assumes that all shares have been included in the computation based on the weighted average number of days since issue.

2012

2011

£

£

Profit/(loss) attributable to equity holders of the Group:

Profit/(loss) from continuing operations

449,833

695,417

Loss from discontinued operations

-

(3,570)

Profit/(loss) for the year attributable to equity holders of the Group

449,833

691,847

Weighted average number of ordinary shares in issue for basic earnings

577,857,956

350,912,751

Weighted average number of ordinary shares in issue for fully diluted earnings

616,797,847

350,912,751

EARNINGS/(LOSS) PER SHARE

BASIC:

- Continuing operations

0.078p

0.197p

- Discontinued operations

0.000p

0.000p

- Total basic earnings/(loss) per share

0.078p

0.197p

FULLY DILUTED:

- Continuing operations

0.073p

0.194p

- Discontinued operations

0.000p

0.000p

- Total fully diluted earnings/(loss) per share

0.073p

0.194p

For 2011 the share options in issue were anti-dilutive in respect of the loss per share calculation and have therefore not been included.

13

INVESTMENT IN SUBSIDIARY UNDERTAKINGS

COMPANY

2012

2011

£

£

COST

As at 1 January and 31 December

1,480,098

1,480,098

PROVISIONS

As at 1 January and 31 December

1,480,098

1,480,098

NET BOOK VALUE

-

-

Viridas GmbH

Private

Germany

Dormant

EURO 25,000 Registered shares

100%

Viridas Brasil Agronegocios Ltd

Private

Brazil

Dormant

R$ 100,000

100%

Viridas Enterprises Brasil Limited

Private

UK

Dormant

£1 Ordinary shares

100%

14

INVESTMENTS HELD FOR TRADING

GROUP

COMPANY

2012

2011

2012

2011

£

£

£

£

At 1 January - fair value

1,760,086

-

1,760,086

-

Acquisitions

1,249,985

674,513

1,249,985

674,513

Disposal proceeds

(2,501,269)

-

(2,501,269)

-

Net gain on disposal of investments

1,922,265

-

1,922,265

-

Unrealised (losses)/gains on investments

(1,231,459)

1,085,573

(1,231,459)

1,085,573

.At 31 December - fair value

1,199,608

1,760,086

1,199,608

1,760,086

Categorised as:

Level 1 - Quoted investments

1,029,011

1,760,086

1,029,011

1,760,086

Level 3 - Unquoted investments

170,597

-

170,597

-

1,199,608

1,760,086

1,199,608

1,760,086

15

TRADE AND OTHER RECEIVABLES

GROUP

COMPANY

2012

2011

2012

2011

£

£

£

£

Other receivables

33,306

74,148

32,152

72,330

Prepayments and accrued income

8,374

11,022

8,374

11,022

41,680

85,170

40,526

83,352

16

CASH AND CASH EQUIVALENTS

GROUP

COMPANY

2012

2011

2012

2011

£

£

£

£

Cash and cash equivalents

1,454,495

375,659

1,441,177

357,940

17

TRADE AND OTHER PAYABLES

GROUP

COMPANY

2012

2011

2012

2011

£

£

£

£

Trade payables

24,972

21,468

24,972

21,468

Social security and other taxes

1,017

2,288

-

2,288

Other payables

-

2,682

-

2,682

Accrued expenses

13,451

26,386

12,000

16,780

39,440

52,824

36,972

43,218

18

FINANCIAL INSTRUMENTS

The Group uses financial instruments, other than derivatives, comprising cash to provide funding for the Group's operations.

The main risk arising from the Group financial instruments is liquidity risk. The Group does not have any significant other risks. The Directors agree policies for managing these risks and they are summarised below:

LIQUIDITY RISK

The Group seeks to manage financial risk, to ensure sufficient liquidity is available to meet foreseeable needs.

An analysis of trade and other payables is given in note 16. These payables are payable within a year.

NET FOREIGN CURRENCY MONETARY ASSETS

Euro

Total

Functional currency of the operation

£

£

Sterling

13,318

13,318

The Directors do not consider the Group has significant exposure to movements in foreign currency in respect of its monetary assets.

CATEGORIES OF FINANCIAL INSTRUMENTS

2012

2011

£

£

FINANCIAL ASSETS:

Cash and bank balances

1,454,495

375,659

Loans and receivables

183,306

74,148

Available for sale financial assets

1,310,008

1,760,086

FINANCIAL LIABILITIES AT AMORTISED COST:

Trade and other payables

25,989

26,438

19

SHARE CAPITAL

Number of shares

Share capital

Deferred

Ordinary

Deferred

Ordinary

£

£

ISSUED AND FULLY PAID:

At 1 January 2012:

Deferred shares of 9.9p each

32,857,956

-

3,252,938

-

Ordinary shares of 0.1p each

-

577,857,956

-

577,858

At 31 December 2012

32,857,956

577,857,956

3,252,938

577,858

20

OTHER RESERVES

Capital redemption reserve

Share

 option reserve

Total

Other reserves

£

£

£

Balance at 1 January 2011

27,000

-

27,000

Share based payment costs

-

4,690

4,690

Balance at 31 December 2011

27,000

-

31,690

Share based payment costs

-

38,419

38,419

Balance at 31 December 2012

27,000

43,109

70,109

21

RELATED PARTY TRANSACTIONS

Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

The compensation payable to Key Management personnel comprised £89,334 (2011: £284,625) paid by the Group to the Directors in respect of services to the Group. Full details of the compensation for each Director are provided in Note 7.

Nicholas Lee is a director and controlling shareholder of ACL Capital Limited which invoiced the Company £37,000 in respect of consultancy fees due for the year (2011: £9,250). £2,500 of this amount was invoiced and paid after the year end. No other amounts were owed at 31 December 2012.

Nicholas Lee is also a director of Brady Exploration plc, in which the Company has a 27% shareholding, and Leed Resources plc, in which the Company had a 22% shareholding at the start of the year, which was disposed of in January 2012.

22

POST YEAR END EVENTS

The significant post year end events are set out in the Directors' report.