Rurelec Regulatory News (RUR)

30 Mar 2005 15:50

Rurelec PLC30 March 2005 FOR IMMEDIATE RELEASE Rurelec PLC ("Rurelec") 30th March 2005 Interim results for the 6 months ended 31st December 2004 Chairman's Statement Rurelec today announces its first results since joining the AIM Market in August2004. Since its flotation, Rurelec has moved to acquire power generation assets forinstallation in isolated areas of Latin America serving rural communities inBolivia and Argentina. I am pleased to report that Rurelec now owns outright 12MW of gas fired and dual fuel capacity in the form of two Worthington and threeGE Jenbacher 616 gas engines. Rurelec also has the right to acquire a further15 MW of dual fuel machines and has made arrangements to lease a further 4 MW ofGE Jenbacher capacity. All of Rurelec's initial power generation projects are located in Bolivia. 6 MWof capacity is to be based in Trinidad in the country's lowland Amazonianterritory using gas condensate as a fuel source. Rurelec intends to expand inTrinidad and is exploring the use of bio-diesel for its dual fuel reciprocatingengines. 10 MW of gas-fired capacity using the high efficiency GE Jenbacher gasengines will be installed in the Department of Tarija to the south of Bolivia. Rurelec is actively negotiating expansion opportunities in Argentina to the verynorth of the country, where the national grid is weak, and in Patagonia to thesouth where there are isolated systems. Argentina and Bolivia both suffershortages of power generation capacity. As well as developing new power plant capacity, Rurelec is pursuing publicsector contracts to oversee and manage rural electrification projects in Boliviawhich are being funded by multi-lateral organisations and European governmentfunds. Some US $190 million has been committed for public sector funded wiresprojects in rural areas. Rurelec hopes to be awarded contracts to supervisesuch projects. As expected, Rurelec recorded a loss of £107,870 for the period ended 31December, 2004. On 25 February, 2005 the Company announced that it hadcompleted the purchase of nine GE Jenbacher 616 engines for £1 million andsimultaneously sold six of those machines for £1 million, thereby recording agross profit of £333,000. Subsequently, the Company announced on 3rd March that it had successfullyrenegotiated the terms of its October 2004 purchase of two Worthington engines.Instead of taking an assignment of US $1.2 million of long term debt associatedwith the machines, Rurelec has made a one time cash payment of US $500,000.Rurelec has therefore made a headline saving of US $700,000 on the cost of themachines. As a result Rurelec as at today's date has no debt, ownership of 12MW of plant capacity and over £600,000 of cash or near cash. Rurelec appointed Carlos Garcia Agreda as General Manager of its Bolivianisolated power subsidiary, Energia para Sistemas Aislados SA ("ESA"). CarlosGarcia is an electrical and mechanical engineer who spent six years atCooperativa Rural de Electrificacion ("CRE"), a distribution co-operative thatserves Bolivia's Santa Cruz department and which is also Bolivia's largest ruralelectrification co-operative, before taking responsibility for ruralelectrification projects at Bolivia's Vice-Ministry of Electricity. Theprovision of power for isolated generation has become an important politicalissue in Bolivia. ESA is in discussions, which may lead to new joint ventureswith local partners in Bolivia and Argentina and with multi-lateral agencies foran accelerated roll-out of new power capacity. In November 2004 funds managed by Gartmore subscribed £255,000 of new Rurelecshares for cash and now owns 4.7 per cent. of the issued share capital of theCompany. Rurelec continues to explore expansion possibilities in line with its intentionto become the leading rural power company in Southern Cone of Latin America. Daniel Stewart & Co. PLC has been appointed the Company's Nominated Adviser,with effect from 30th March 2005. Jimmy WestChairman Unaudited Consolidated Profit and Loss Account for the six months ended 31December 2004 Period from 6 months to incorporation to 31 December 2004 30 June 2004 Unaudited Audited £ £ Turnover 0 0Administrative expenses (112,774) (22)Interest receivable 4,904 65(Loss)/Profit on ordinary activities beforetaxation (107,870) 43Tax on profit on ordinary activities - -(Loss)/Profit for the period (107,870) - Loss per ordinary share for the six months ended 31st December 2004: 0.88pUnaudited Consolidated Balance Sheet at 31 December 2004 31 December 30 June 2004 2004 Unaudited Audited £ £ £ £Fixed assets 322,660 0 Current assets Cash at bank and in hand 893,010 200,043 Debtors 40,933 0 933,943 200,043 Current Liabilities Creditors: amounts falling due within one (302,076) 0year Current assets less current liabilities 631,867 200,043 Total assets less current liabilities 954,527 200,043 Capital and Reserves Called up share capital 252,000 200,000Unrealised gain on investment 18,124Share premium account 792,232 0Profit and loss account (107,829) 43 954,527 200,043 Net assets per ordinary share at 31st December 2004: 7.6p Unaudited Consolidated Cashflow Statement for the six months ended 31 December2004 Period from 6 months to incorporation to 31 December 2004 30 June 2004 Unaudited Audited £ £Net cash outflow from operatingactivities (112,774) (22)Net Increase in liabilities 261,141Returns on investments and servicingof finance:Interest received 4,904 65Net cashflow from operating 153,271activities and returns on investment 43 Financing: share issues less issueexpenses written off 844,232 200,000 Unrealised foreign exchange gain 18,124Investment in subsidiary (322,660) 0Net cashflow from financing and 539,696investment Net cashflow 692,967 200,043 Notes to the unaudited financial statements 1. The financial information set out above does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. It has been prepared on the basis of the accounting policies set out in the Group's 2004 statutory accounts. The results for the period to 30th June 2004 have been extracted from the Group's published accounts which have been filed with the Registrar of Companies. The auditors' report on the full statutory accounts of the Group for the period ended 30 June 2004 were unqualified. 2. The financial information for the six months ended 31 December 2004 has not been audited. 3. The consolidated balance sheet has been prepared in accordance with the rules for acquisition accounting. In the opinion of the Directors the adjustment to fair value is reasonable. 4. The loss per ordinary share has been calculated on the loss on ordinary activities after taxation of £107,870 using the weighted average number of ordinary shares in issue during the six months 12,186,000. 5. Net assets per ordinary share have been calculated on net assets of £954,527 divided by 12,600,000 ordinary shares in issue at 31st December 2004. 6. Post balance sheet events (i) Pursuant to an amendment to the contract dated 11th October 2004 for the purchase of Energia para Sistemas Aislados S.A. ("ESA"), executed on 2nd March 2005, the company's investment in its subsidiary is US$550,000, the sterling equivalent of which, at the original contract date, is £306,961. Of this amount US$500,000 was outstanding at year end, equivalent to £260,552, and is carried as a short term creditor. The difference between the carrying value of the assets acquired and the value of the liability at 31st December 2004 is shown as an unrealised gain on investment (ii) On 25th February, 2005 the Company completed the purchase an onward sale of GE Jenbacher 616 gas engines. Nine engines were acquired for a consideration of £1 million. Simultaneously the Company sold six engines, also for £1 million, recognising a £333,333 gain on disposal. The carrying value of the three machines the Company now owns is £333,333. 7. This announcement is being sent to all shareholders on the register at 30th March 2005 and copies are available to the general public free of charge during office hours for one month from the date of this announcement at the Company's registered office, Fifth Floor, Prince Consort House, 27-29 Albert Embankment, London SE1 7TJ. For further information contact:Elizabeth ShawTel: +44 (0)20 7793 7676 Rurelec PLC is a British company established to develop rural electrificationprojects in Latin America. It is managed by a team with a strong track recordin developing power projects worldwide and with considerable experience in theelectricity sector in Latin America. Rurelec has two principal businesses: -Ownership of power generation facilities in isolated areas -Management of rural electrification expansion projects funded by the World Bankor multi-lateral development agencies. Rurelec floated on the AIM market of the London Stock Exchange in August 2004 inorder to have access to European institutional capital for new power projectsand to ensure transparency for its public sector-funded project managementactivities. Daniel Stewart & Co. PLC which is authorised by the Financial Services Authorityis acting as nominated adviser to Rurelec and for no one else in connection withthe transactions described herein and will not be responsible to any personother than Rurelec for providing the protection afforded to its customers or foradvising any other person in relation to the transactions described herein. This information is provided by RNS The company news service from the London Stock Exchange