Last checked at 30 Sep 2015 07:01
30 September 2015
San Leon Energy Plc
("San Leon" or "the Company")
Interim Results
San Leon Energy, the AIM listed company focused on oil and gas exploration in Europe and North Africa, today announces its interim results for the six months ended 30 June 2015.
Highlights:
Operational
· Announced a gas discovery at the Rawicz-12 well; expected to be the largest gas development in Poland for 20 years. · The Rawicz gas field contains over 50 Bcf of 2P reserves according to a Competent Persons Report by Ryder Scott Company for Palomar Natural Resources, the operator. · Results of oil shale bench testing at the Timahdit oil shale licence proved the Enefit process to be applicable to the Company's acreage, and are being used to assess the efficiency of the Chevron Lummus upgrading technology on the shale oil. · Post reporting period, the Laayoune-4 well on the Tarfaya conventional licence, onshore Morocco, was drilled and suspended with gas shows, pending further seismic work; and · Initiated asset optimisation and cost reduction strategy, resulting in relinquishing certain non-core Polish licences.
|
Corporate
· Announced £29 million (gross) fundraising, through a placing of new ordinary shares, together with a share capital reorganisation. Completion occurred in July 2015. · Cost reduction remains a priority for the Company and its Board. With effect from 1 January 2015, Oisin Fanning, Executive Chairman, has drawn only 20% of his salary in cash with the balance accruing in San Leon shares. · In July 2015 Jeremy Boak, Non-Executive Director of the Company, accepted a position at The University of Oklahoma, and therefore resigned from the Board.
|
Financial
· Loss for the period was €8.26m (2014: loss of £6.77m). · Cash and cash equivalents as at 30 June 2015 of €0.75m (30 June 2014: €14.58m). · Equity placing to raise £29 million (gross), completed after the reporting period, together with a share capital reorganisation.
|
On 24 August 2015 the Company confirmed that it had received an approach from a possible offeror, that may or may not lead to an offer being made for San Leon. There can be no certainty that an offer will be made or as to the terms on which any offer might be made. As a result, the Board has decided not to make any forward-looking statements.
Enquiries:
San Leon Energy plc Oisin Fanning, Executive Chairman
| +353 1291 6292 |
Brandon Hill Capital Oliver StansfieldJonathan Evans
| +44 (0) 20 3463 5000
|
finnCap Ltd Corporate FinanceMatt Goode Christopher RaggettCorporate BrokingJoanna Weaving
| +44 (0) 20 7220 0500 |
Macquarie Capital (Europe) LimitedJon FitzpatrickNicholas Harland
| +44 (0) 20 3037 2000 |
Westhouse Securities LtdNominated AdviserRichard JohnsonAntonio Bossi
| +44 (0) 20 7601 6100 |
Vigo CommunicationsFinancial Public RelationsChris McMahon Alexandra Roper
| +44 (0) 20 7016 9572 |
Plunkett Public RelationsSharon Plunkett | +353 (0) 1 280 7873 |
The Directors of San Leon accept responsibility for the information contained in this announcement. To the best of their knowledge and belief (having taken all reasonable care to ensure such is the case), the information contained in this announcement is in accordance with the facts and does not omit anything likely to affect the import of such information.
A person interested in 1% or more of any class of relevant securities of San Leon may have disclosure obligations under Rule 8.3 of the Takeover Rules, effective from 24 August 2015.
This announcement may be viewed at the Company's website at www.sanleonenergy.com.
The following financial information on San Leon Energy Plc represents the Group's interim results for the 6 months ended 30 June 2015.
Consolidated income statement
For the six months ended 30 June 2015
|
| Un-audited | Un-audited | Audited |
| Notes | 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Continuing operations
|
|
|
|
|
Revenue |
| 1,105 | 2,196 | 2,942 |
Cost of sales |
| (696) | (1,910) | (543) |
Gross profit |
| 409 | 286 | 2,399 |
|
|
|
|
|
Loss on disposal of subsidiaries |
| - | - | (6,429,007) |
Administrative expenses |
| (4,365,215) | (6,278,231) | (16,877,640) |
Impairment of exploration and evaluation assets |
| - | - | (9,149,836) |
Impairment of equity accounted investments |
| - | - | (3,345,664) |
Loss from operating activities |
| (4,364,806) | (6,277,945) | (35,799,748) |
|
|
|
|
|
Finance expense |
| (3,885,317) | (461,002) | (1,796,659) |
Finance income |
| - | 10,303 | 231,352 |
Share of loss of equity-accounted investments |
| (6,234) | (74,605) | (54,002) |
|
|
|
|
|
Loss before income tax |
| (8,256,357) | (6,803,249) | (37,419,057) |
|
|
|
|
|
Income tax expense |
| - | (33,516) | (875,557) |
|
|
|
|
|
Loss from continuing operations |
| (8,256,357) | (6,836,765) | (38,294,614) |
|
|
|
|
|
Discontinued operations |
|
|
|
|
Profit from discontinued operations (net of income tax) |
3 |
- |
62,156 |
30,258 |
Loss for the period attributable to equity holders of the Group |
|
(8,256,357) |
(6,774,609) |
(38,264,356) |
|
|
|
|
|
Loss per share (cent) - continuing operations |
|
|
|
|
Basic and diluted loss per ordinary share |
| (0.326) cent | (0.269) cent | (1.520) cent |
|
|
|
|
|
Earnings per share (cent) - discontinued operations |
|
|
|
|
Basic and diluted earnings per ordinary share |
| 0.000 cent | 0.002 cent | 0.010 cent |
|
|
|
|
|
Loss per share (cent) - total |
|
|
|
|
Basic and diluted loss per ordinary share |
| (0.326) cent | (0.267) cent | (1.510) cent |
Consolidated statement of other comprehensive income
for the six months ended 30 June 2015
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Loss for the period |
| (8,256,357) | (6,774,609) | (38,264,356) |
|
|
|
|
|
Items that may be reclassified subsequently to the income statement |
|
|
|
|
Foreign currency translation differences - foreign operations |
| 1,403,303 | 908,328 | 817,175 |
Fair value movements in available-for-sale financial assets |
| 3,497,875 | 904,974 | 5,102,461 |
Deferred tax on fair value movements in available- for-sale financial assets |
| - | - | (2,084,197) |
Total comprehensive loss for the period |
| (3,355,179) | (4,961,307) | (34,428,917) |
|
|
|
|
|
Consolidated statement of changes in equity
For the period ended 30 June 2015
|
Share capital reserve |
Share premium reserve |
Currency translation In Group | Share based payment reserve |
Fair value reserve |
Retained earnings |
Attributable to equity holders |
Non-controlling interest |
Total | |||||||||
| € | € | € | € | € | € | € | € | € | |||||||||
|
|
|
|
|
|
|
|
|
| |||||||||
Balance at 1 January 2015 | 126,778,633 | 164,099,598 | (571,578) |
11,424,904 | (76,979) |
(50,868,681) |
250,785,897 |
2,248 | 250,788,145 | |||||||||
Total comprehensive income for period |
|
|
|
|
|
|
|
|
| |||||||||
Loss for the period |
- | - | - | - |
- | (8,256,357) | (8,256,357) | - | (8,256,357) | |||||||||
Other comprehensive income |
|
|
|
|
|
|
|
|
| |||||||||
Foreign currency translation differences - foreign operations | - | - | 1,403,303 | - |
- | - | 1,403,303 | - | 1,403,303 | |||||||||
Fair value movements in available-for-sale financial assets | - | - | - | - |
3,497,875 | - | 3,497,875 | - | 3,497,875 | |||||||||
Total comprehensive income for period | - | - | 1,403,303 | - |
3,497,875 | (8,256,357) | (3,355,179) | - | (3,355,179) | |||||||||
|
|
|
|
|
|
|
|
|
| |||||||||
Transactions with owners recognised directly in equity |
|
|
|
|
|
|
|
| ||||||||||
Contributions by and distributions to owners |
|
|
|
|
|
|
| |||||||||||
Share warrants exercised | - | - | - | - | - | - | - | - | - | |||||||||
Share based payment | - | - | - | 412,345 | - | - | 412,345 | - | 412,345 | |||||||||
Effect of share options forfeit | - | - | - | - | - | - | - | - | - | |||||||||
Shares issued to Realm shareholders on conversion of exchangeable shares | 866 | 1,382 | - | - |
- | - | 2,248 | (2,248) | - | |||||||||
Total transactions with owners | 866 | 1,382 | - | 412,345 |
- | - | 414,593 | (2,248) | 412,345 | |||||||||
Balance at 30 June 2015 | 126,779,499 | 164,100,980 | 831,725 | 11,837,249 | 3,420,896 | (59,125,038) | 247,845,311 | - | 247,845,311 | |||||||||
|
|
|
|
|
|
|
|
|
| |||||||||
Consolidated statement of changes in equity For the period ended 30 June 2014
|
|
|
|
|
| |||||||||||||
|
Share capital reserve |
Share premium reserve |
Currency translation In Group | Share based payment reserve |
Fair value reserve |
Retained earnings |
Attributable to equity holders |
Non-controlling interest |
Total | |||||||||
| € | € | € | € | € | € | € | € | € | |||||||||
Balance at 1 January 2014 | 126,560,947 | 164,232,712 | (1,388,753) | 10,213,497 |
(3,095,243) | (12,604,325) |
283,918,835 |
527,851 | 284,446,686 | |||||||||
Total comprehensive income for period |
|
|
|
|
|
|
|
|
| |||||||||
Profit for the period | - | - | - | - | - | (6,774,609) | (6,774,609) | - | (6,774,609) | |||||||||
Other comprehensive income |
|
|
|
|
|
|
|
|
| |||||||||
Foreign currency translation differences - foreign operations | - | - | 908,329 | - |
- | - | 908,329 | - | 908,329 | |||||||||
Fair value movements in available-for-sale financial assets | - | - | - | - |
745,479 | - | 745,479 | - | 745,479 | |||||||||
Total comprehensive income for period | - | - | 908,329 | - |
745,479 | (6,774,609) | (5,120,801) | - | (5,120,801) | |||||||||
|
|
|
|
|
|
|
|
|
| |||||||||
Transactions with owners recognised directly in equity |
|
|
|
|
|
|
|
|
| |||||||||
Contributions by and distributions to owners
|
|
|
|
|
|
|
| |||||||||||
Share based payment | - | - | - | 605,703 | - | - | 605,703 | - | 605,703 | |||||||||
Effect of share options forfeit | - | - | - | - | - | - | - | - | - | |||||||||
Shares issued to Realm shareholders on conversion of exchangeable shares | 190,215 | 333,609 | - | - | - | - | 523,824 | (523,824) | - | |||||||||
Total transactions with owners | 190,215 | 333,609 | - | 605,703 | - | - | 1,129,527 | (523,824) | 605,703 | |||||||||
Balance at 30 June 2014 | 126,751,162 | 164,566,321 | (480,424) | 10,819,200 |
(2,349,764) | (19,378,934) | 279,927,561 | 4,027 | 279,931,588 | |||||||||
Consolidated statement of changes in equity
For the period ended 30 June 2014
|
Share capital reserve |
Share premium reserve |
Currency translation In Group | Share based payment reserve |
Fair value reserve |
Retained earnings |
Attributable to equity holders |
Non-controlling interest |
Total | ||||||||
| € | € | € | € | € | € | € | € | € | ||||||||
|
|
|
|
|
|
|
| ||||||||||
Balance at 1 January 2014 | 126,560,947 | 164,232,712 | (1,388,753) | 10,213,497 |
(3,095,243) | (12,604,325) |
283,918,835 |
527,851 | 284,446,686 | ||||||||
Total comprehensive income for year |
|
|
|
|
|
|
|
|
| ||||||||
Loss for the year | - | - | - | - | - | (38,264,356) |
(38,264,356) | - | (38,264,356) | ||||||||
Other comprehensive income |
|
|
|
|
|
|
|
|
| ||||||||
Foreign currency translation differences - foreign operations | - | - | 817,175 |
|
|
|
817,175 |
| 817,175 | ||||||||
Fair value movements in available-for-sale financial assets | - | - | - | - |
5,102,461 | - |
5,102,461 |
- | 5,102,461 | ||||||||
Deferred tax on fair value movements in available-for-sale financial assets | - | - | - | - |
(2,084,197) | - |
(2,084,197) |
- | (2,084,197) | ||||||||
Total comprehensive income for year | - | - | 817,175 | - |
(3,018,264) | (38,264,356) |
(34,428,917) |
- | (34,428,917) | ||||||||
Transactions with owners recognised directly in equity |
|
|
|
|
|
|
|
|
| ||||||||
Contributions by and distributions to owners
|
|
|
|
|
|
|
| ||||||||||
Cost of issue of shares for cash in 2013 | - | (473,715) | - | - |
- | - |
(473,715) |
- |
(473,715) | ||||||||
Share based payment | - | - | - | 1,211,407 | - | - | 1,211,407 | - | 1,211,407 | ||||||||
Effect of share warrants forfeit | - | - | - | - | - | - | - | - | - | ||||||||
Effect of share options exercised | 26,825 | 5,859 | - | - | - | - | 32,684 | - | 32,684 | ||||||||
Shares issued to Realm shareholders on conversion of exchangeable shares | 190,861 | 334,742 | - | - | - | - | 525,603 | (525,603) | - | ||||||||
Total transactions with owners | 217,686 | (133,114) | - | 1,211,407 |
- | - | 1,295,979 | (525,603) | 770,376 | ||||||||
Balance at 31 December 2014 | 126,778,633 | 164,099,598 | (571,578) |
11,424,904 | (76,979) |
(50,868,681) |
250,785,897 |
2,248 | 250,788,145 | ||||||||
Consolidated statement of financial position
As at 30 June 2015
| Notes | Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Assets |
|
|
|
|
Non-current assets |
|
|
|
|
Exploration and evaluation assets | 3 | 168,476,273 | 195,480,814 | 163,375,424 |
Equity accounted investments | 4 | 44,602,436 | 24,055,865 | 44,483,000 |
Property, plant and equipment | 5 | 10,483,522 | 10,305,205 | 10,831,903 |
Other non-current assets |
| 833,043 | 3,976,995 | 833,045 |
Financial assets | 6 | 45,707,031 | 38,177,562 | 42,534,544 |
Other financial assets | 6 | 5,685,422 | - | 5,360,034 |
|
| 275,787,727 | 271,996,441 | 267,417,950 |
Current assets |
|
|
|
|
Inventory |
| 332,706 | 1,107,932 | 320,043 |
Trade and other receivables | 7 | 9,903,545 | 9,391,615 | 10,344,339 |
Other financial assets | 8 | 1,433,759 | 6,289,030 | 1,335,361 |
Cash and cash equivalents | 9 | 745,897 | 14,582,901 | 1,808,715 |
Assets classified as held for sale |
| - | 15,549,147 | - |
|
| 12,415,907 | 46,920,625 | 13,808,458 |
Total assets |
| 288,203,634 | 318,917,066 |
281,226,408 |
Equity and liabilities |
|
|
|
|
Equity |
|
|
|
|
Called up share capital | 13 | 126,779,499 | 126,751,162 | 126,778,633 |
Share premium account | 13 | 164,100,980 | 164,566,321 | 164,099,598 |
Share based payments reserve |
| 11,837,249 | 10,819,200 | 11,424,904 |
Currency translation reserve |
| 831,725 | (480,424) | (571,578) |
Fair value reserve |
| 3,420,896 | (2,349,764) | (76,979) |
Retained earnings |
| (59,125,038) | (19,378,934) | (50,868,681) |
Attributable to equity holders of the Group |
| 247,845,311 | 279,927,561 | 250,785,897 |
Non-controlling interest |
| - | 4,027 | 2,248 |
Total equity |
| 247,845,311 | 279,931,588 | 250,788,145 |
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Derivative |
| 456 | 208,434 | 4,017 |
Deferred tax liabilities |
| 12,198,995 | 9,329,447 | 12,198,995 |
|
| 12,199,451 | 9,537,881 | 12,203,012 |
|
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables | 10 | 14,974,712 | 19,502,329 | 10,963,732 |
Drawdown facility | 11 | 11,703,071 | 2,373,196 | 5,814,022 |
Provisions | 12 | 1,481,088 | 1,404,948 | 1,457,497 |
Liabilities classified as held for sale |
| - | 6,167,124 | - |
|
| 28,158,871 | 29,447,597 | 18,235,251 |
|
|
|
|
|
Total liabilities |
| 40,358,323 | 38,985,478 | 30,438,263 |
Total equity and liabilities |
| 288,203,634 | 318,917,066 |
281,226,408 |
Consolidated statement of cash flows
For the six months ended 30 June 2015
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Cash flows from operating activities |
|
|
|
|
Loss before tax - Continuing operations |
| (8,256,357) | (6,803,249) | (37,419,057) |
Profit before tax - Discontinued operations |
| - | 62,156 | 30,258 |
Adjustments for: |
|
|
|
|
Depletion and depreciation |
| 461,996 | 15,187 | 101,570 |
Finance expense |
| 3,885,317 | 461,002 | 1,796,659 |
Finance income |
| - | (10,303) | (231,352) |
Share based payments charge |
| - | 108,189 | 249,064 |
Foreign exchange |
| 1,013,263 | 520,006 | (1,739,289) |
Impairment of exploration and evaluation assets - continuing operations |
| - | - | 9,149,836 |
Impairment of equity accounted assets - continuing operations |
| - | - | 3,345,664 |
Increase in other non-current assets |
| - | (569,174) | 457,051 |
Loss on disposal of subsidiaries |
| - | - | 6,429,007 |
Increase in stocks |
| (12,663) | (877,954) | (90,065) |
Decrease in trade and other receivables |
| 440,793 | 3,984,832 | 2,398,785 |
Increase in trade and other payables |
| 4,009,796 | 13,039,079 | 5,483,083 |
Other non-current assets |
| - | - | 2,117,728 |
Share of loss of equity-accounted investments |
| 6,234 | 74,605 | 54,002 |
Tax repaid/(paid) |
| 1,186 | (3,373) | (21,031) |
Net cash flows in operating activities |
| 1,549,565 | 10,001,003 |
(7,888,087) |
Cash flows from investing activities |
|
|
|
|
Expenditure on exploration and evaluation assets |
| (3,685,317) | (11,985,966) | (19,909,050) |
Joint venture partner share of exploration costs |
| - | 4,045,909 | 363,293 |
Purchases of property, plant and equipment |
| (73,251) | (522,672) | (1,701,433) |
Interest received |
| (3,561) | 10,303 | 3,515 |
Decrease in restricted cash |
| - | - | 325,354 |
Advances to equity accounted investments |
| (110,110) | - | (1,054,618) |
Repayment from/(advances) to equity-accounted investments |
| - | (397,906) | - |
Proceeds of farm-out arrangement |
| - | - | 14,806,537 |
Net cash (used)/generated from investing activities |
| (3,872,239) | (8,850,332) | (7,166,402) |
Cash flows from financing activities |
|
|
|
|
Cost of issue of shares in 2013 |
| - | - | (473,715) |
Proceeds from drawdown facility |
| 4,672,360 | 2,092,864 | 8,415,037 |
Repayment of drawdown facility |
| (3,131,661) | - | (3,070,671) |
Movement in director loan |
| - | - | 2,201,471 |
Interest and arrangement fees paid |
| (18,267) | (174,537) | (1,641,403) |
Net cash generated/(used) in financing activities |
| 1,522,432 | 1,918,327 | 5,430,719 |
Net increase in cash and cash equivalents |
| (800,242) | 3,068,988 |
(9,623,770) |
Effect of foreign exchange fluctuation on cash and cash equivalents |
| (262,576) | 92,935 | 11,517 |
Cash and cash equivalents at start of period |
| 1,808,715 | 11,420,968 | 11,420,968 |
Cash and cash equivalents at end of period |
| 745,897 | 14,582,901 | 1,808,715 |
Notes to the Interim Financial Information
1. Basis of preparation and accounting policies
The Group interim financial information has been prepared in accordance with International Financial Reporting Standards and the accounting policies adopted are consistent with those followed in the preparation of the Group's financial statements for the year ended 31 December 2014. The interim financial information was approved by the Board of Directors on 25 September 2015.
The interim consolidated financial statements do not constitute statutory financial statements and therefore do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 December 2014 which are available on the Group's website www.sanleonenergy.com.
The interim consolidated financial statements are presented in Euro ("€").
2. Loss on disposal of subsidiaries
In September 2013 the Company signed a Binding Heads of Agreement in respect of the sale of Island Oil & Gas Limited, a subsidiary of the company to Ardilaun Energy Limited ("Ardilaun"). Under the terms of the sale, Ardilaun agreed to pay San Leon Energy US$3 million, with €738,716 (US$1 million) payable immediately and the balance of US$2 million payable within twelve months of the completion of the sale. Ardilaun has also agreed to issue to San Leon Energy, shares equivalent to 15 per cent of the enlarged issued share capital of Ardilaun post-completion of the sale and prior to its intended listing on an international exchange.
Prior to their reclassification as assets held for sale in 2013 the exploration and evaluation assets were impaired by €3.6 million. The impairment was determined by management by comparing the carrying value of the net assets to the proposed consideration in the transaction. The fair value of the 15% of the enlarged issued share capital of Ardilaun was based on a recent market transaction.
In the year ended 31 December 2014, the sale to Ardilaun completed and the Group recognised a loss on disposal of €6,429,007. The loss primarily related to the Group's contribution to the decommissioning liability associated with the exploration and evaluation assets disposed of.
Results from discontinued operations - Ardilaun |
|
|
| |||
| Un-audited | Un-audited | Audited | |||
| 30/06/15 | 30/06/14 | 31/12/14 | |||
| € | € | € | |||
Revenue | - | 404,089 | 679,690 | |||
Cost of sales | - | (350,727) | (658,891) | |||
Gross profit | - | 53,362 | 20,799 | |||
Administration expenses | - | 8,794 | 9,459 | |||
Impairment of assets reclassified as held for sale | - | - | - | |||
Results from operating activities | - | 62,156 | 30,258 | |||
Income tax | - | - | - | |||
Results from operating activities after tax | - | 62,156 | 30,258 | |||
|
|
|
| |||
The total loss from discontinued operations is attributable to the owners of the Company. |
|
|
| |||
|
|
|
| |||
|
|
|
| |||
Cash flows from discontinued operations |
|
|
| |||
| Un-audited | Un-audited | Audited | |||
| 30/06/15 | 30/06/14 | 31/12/14 | |||
| € | € | € | |||
Net cash from operating activities | - | 170 | 285,079 | |||
Net cash flows for the year | - | 170 | 285,079 | |||
Earnings/(loss) per share (cent) - discontinued operations |
|
|
| |||
Basic and diluted earnings/(loss) per ordinary share | - | 0.002 cent | 0.01 cent | |||
|
|
|
| |||
3. Exploration and evaluation assets
Cost and net book value |
|
Un-audited |
|
|
| 30/06/14 |
|
|
| € |
|
At 1 January 2014 |
| 186,052,006 |
|
Additions |
| 19,945,338 |
|
Currency translation adjustment |
| 910,192 |
|
Impairment of exploration assets |
| (9,149,836) |
|
Disposals |
| (205,688) |
|
Proceeds from farm out arrangement |
| (10,945,319) |
|
Transfer to equity accounted investments |
| (23,231,269) |
|
At 31 December 2014 |
| 163,375,424 |
|
Acquisitions |
|
|
|
Additions |
| 4,070,801 |
|
Exchange rate adjustment |
| 1,030,048 |
|
At 30 June 2015 |
| 168,476,273 |
|
An analysis of exploration assets by geographical area is set out below:
|
| 30/06/2015 € |
|
Poland |
| 97,039,148 |
|
Morocco |
| 53,390,342 |
|
Albania |
| 7,378,739 |
|
Romania |
| 9,511,656 |
|
Other areas |
| 1,156,388 |
|
Total |
| 168,476,273 |
|
The Directors have considered the licence, exploration and appraisal costs capitalised in respect of its exploration and evaluation assets, which are carried at historical cost. Those assets have been assessed for impairment and in particular with regard to remaining licence terms, likelihood of licence renewal, likelihood of further expenditures and on-going appraisals for each year. The directors are satisfied that there are no current indications of impairment, but recognise that the future realisation of these exploration and evaluation assets is dependent on future successful exploration and appraisal activities and the subsequent economic production of oil and gas reserves.
4. Equity accounted investments
| Un-audited | Un-audited | Audited |
| 30/06/15 | 30/06/14 | 31/12/14 |
| € | € | € |
Opening balance |
44,483,000 |
23,728,594 |
23,728,594 |
Transfer from exploration and evaluation assets | - | - | 23,231,269 |
Transfer from other assets | - | - | 1,753,188 |
Proceeds of farm out arrangement | - | - | (1,922,406) |
Impairment of equity accounted investments | - | - | (3,345,664) |
Exchange rate adjustment | - | 3,970 | 37,405 |
Net advances to equity accounted investments | 125,670 | 397,906 | 1,054,616 |
Share of loss of equity accounted investments | (6,234) | (74,605) | (54,002) |
|
|
|
|
Closing balance | 44,602,436 | 24,055,865 | 44,483,000 |
5. Property, plant and equipment
| Plant & equipment € | Assets under construction € | Office equipment € | Motor vehicles € | Total € |
Cost At 1 January 2014 | 5,570,156 | 6,699,489 | 1,172,483 | 475,691 | 13,917,819 |
Additions | - | 1,807,179 | 210,554 | 1,670 | 2,019,403 |
Currency translation adjustment | (142,504) | - | (13,063) | (10,770) | (166,337) |
Disposals | (86,881) | - | (244,492) | - | (331,373) |
At 31 December 2014 | 5,340,771 | 8,506,668 | 1,125,482 | 466,591 | 15,439,512 |
Additions | 193 | 144,956 | 2,589 | 3,728 | 151,466 |
Exchange rate adjustment | 104,621 | - | 4,237 | 5,427 | 114,285 |
At 30 June 2015 | 5,445,585 | 8,651,624 | 1,132,308 | 475,746 | 15,705,263 |
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
At 1 January 2014 | 2,491,374 | - | 667,962 | 244,032 | 3,403,368 |
Currency translation adjustment | (56,833) | - | (7,077) | (4,565) | (68,475) |
Disposals | (86,606) | - | (94,222) | - | (180,828) |
Charge for year | 1,097,946 | - | 269,663 | 85,935 | 1,453,544 |
At 31 December 2014 | 3,445,881 | - | 836,326 | 325,402 | 4,607,609 |
Exchange rate adjustment | 67,498 | - | 3,026 | 3,395 | 73,919 |
Charge for period | 446,996 | - | 45,977 | 47,240 | 540,213 |
At 30 June 2015 | 3,960,375 | - | 885,329 | 376,037 | 5,221,741 |
|
|
|
|
|
|
Net book value |
|
|
|
|
|
At 30 June 2015 | 1,485,210 | 8,651,624 | 246,979 | 99,709 | 10,483,522 |
At 31 Dec 2014 | 1,894,890 | 8,506,668 | 289,156 | 141,189 | 10,831,903 |
Asset under construction relates to the Company's Oil Shale Project in Morocco.
6. Financial assets
|
|
|
Barryroe 4.5% net profit interest (i) € |
Quoted shares (ii) € |
Unquoted shares (iii) € |
Total
€ |
Cost At 1 January 2014 |
|
|
37,083,316 |
348,767 |
- |
37,432,083 |
Additions |
|
| - | - | 5,360,034 | 5,360,034 |
Fair value movement |
|
| 5,039,736 | 62,725 | - | 5,102,461 |
At 31 December 2014 |
|
| 42,123,052 | 411,492 | 5,360,034 | 47,894,578 |
Fair value movement |
|
| 3,583,979 |
(86,104) |
- |
3,497,875 |
At 30 June 2015 |
|
|
45,707,031 |
325,388 |
5,360,034 |
51,392,453 |
|
|
|
|
|
|
|
At 30 June 2014 |
|
| 37,444,429 | 733,133 | - | 38,177,562 |
(i) Barryroe - 4.5% net profit interest
In December 2011, San Leon Energy assigned its 30% working interest in Standard Exploration Licence 1/11 ("Licence" or "Barryroe") in the Celtic Sea, Ireland to Providence Resources Plc ("Providence") in exchange for a 4.5% Net profit interest ("NPI") in the full field. Under the terms of the arrangement, San Leon Energy will not pay any further appraisal or development costs on the Licence. The Directors have estimated the fair value of this NPI by reference to a third party evaluation report of contingent resources and cash flows prepared by Netherland Sewell & Associates Inc. (NSAI) in July 2013 for Providence.
NSAI reported that the Basal Wealden oil reservoir has an estimated 2C in-place gross on-block volume of 761 MMBO with recoverable resources of 261 MMBO and 187 BCF of associated gas, based on a 35% oil recovery factor. In July 2013, NSAI also provided an estimate of the cash flows attributable to Providence's net interest from the Basal Wealden oil reservoir only. It estimated Providence's net present value at USD 2.63 billion in the 2C case (estimated recoverable resources of 266 MMBO and 187 BCF of associated gas) at a 10% discount rate.
Further details are available on the Providence website. Further information has also been made available by Providence and other sources regarding a revised development plan or development costs which are key inputs into the valuation model.
As San Leon is not the operator of this licence, the Group does not have the ability to commission an independent technical evaluation of the licence area. Therefore, the directors believe that the NSAI report, when coupled with other information released by Providence and adapted for certain changes in the market, gives the basis for the best estimate of fair value at year end.
The fair value movement relates to currency adjustments.
(ii) Amedeo Resources plc
In 2014, the Company purchased 71,225,000 ordinary shares in Amedeo Resources plc, a company listed on
the Alternative Investment Market in London, for a total consideration of €1,329,349. The market value of the shares at 30 June 2015 was €325,388.
(iii) Ardilaun Energy Limited
As part of the consideration for the sale of Island Oil & Gas Limited to Ardilaun Energy Limited ("Ardilaun"). Ardilaun agreed to issue shares equivalent to 15% of the issued share capital of Ardilaun.
7. Trade and other receivables
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Amounts falling due within one year: Trade receivables from joint operating partners |
|
137,372 |
178,584 |
713,455 |
VAT and other taxes refundable |
| 988,745 | 2,712,382 | 1,137,977 |
Other debtors |
| 8,166,666 | 6,120,591 | 7,918,678 |
Prepayments and accrued income |
| 610,762 | 380,058 | 574,229 |
|
| 9,903,545 | 9,391,615 | 10,344,339 |
8. Other financial assets
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Restricted cash at bank |
| 1,433,759 | 6,289,030 | 1,335,361 |
|
| 1,433,759 | 6,289,030 | 1,335,361 |
Restricted cash at bank at 30 June 2014 includes €4,751,470 in support of the abandonment liabilities in respect of the Seven Heads Gas Fields.
Restricted cash at bank also includes deposit accounts held in support of bank guarantees required under the Moroccan exploration licences, Zag and Tarfaya held by the Group
9. Cash and cash equivalents
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Cash and cash equivalents |
| 745,897 | 14,582,901 | 1,808,715 |
|
| 745,897 | 14,582,901 | 1,808,715 |
10. Trade and other payables
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Current |
|
|
|
|
Trade payables |
| 8,312,261 | 4,023,992 | 9,246,411 |
PAYE / PRSI |
| 795,523 | 443,494 | 518,994 |
Other creditors |
| 3,970,499 | 14,912,013 | 198,697 |
Accruals and deferred income |
| 1,896,429 | 122,830 | 999,630 |
|
| 14,974,712 | 19,502,329 | 10,963,732 |
11. Drawdown facility
|
| Un-audited | Un-audited | Audited |
|
| 30/06/15 | 30/06/14 | 31/12/14 |
|
| € | € | € |
Current |
|
|
|
|
Drawdown facility |
| 11,703,071 | 2,373,196 | 5,814,022 |
|
| 11,703,071 | 2,373,196 | 5,814,022 |
12. Provisions
Certain Realm Energy International Corporation shareholders exercised rights of dissent under Canadian law not to accept the terms of acquisition. Under Canadian law, these dissenting shareholders are eligible to receive a cash payment equal to the fair value of their shareholding at acquisition. The provision represents the directors' estimate of the cash consideration to be paid to those shareholders taking account of the market price of the Realm shares at acquisition.
13. Share capital
Un-audited | Un-audited | |
30/06/15 | 30/06/14 | |
Authorised | € | € |
3,100,000,000 (2014: 3,100,000,000) Ordinary shares of €0.05 each | 155,000,000 | 155,000,000 |
| 155,000,000 | 125,000,000 |
| ||
| ||
Issued share capital | No. Ordinary Shares | Share capital € | Share premium € |
At 1 Jan 2014 | 2,531,218,948 | 126,560,947 | 164,232,712 |
Issue of shares to non-controlling interest | 3,817,224 | 190,861 | 334,742 |
Issue of shares on exercise of warrants and options | 536,508 | 26,825 | 5,859 |
Expenses directly relating to share placing in 2013 | - | - | (473,715) |
At 31 December 2014 | 2,535,572,680 | 126,778,633 | 164,099,598 |
Issue of shares to non-controlling interest | 17,295 | 866 | 1,382 |
At 30 June 2015 |
2,535,589,975 |
126,779,499 |
164,100,980 |
14. Subsequent events
On 15 July 2015 the Company announced the completion of a £29 million (gross) fundraising, through a placing of new ordinary shares, together with a share capital reorganisation.