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Sound Energy PLC - Half-year Report

Thu, 13th Sep 2018 07:00

RNS Number : 6078A
Sound Energy PLC
13 September 2018
 

 

 

13 September 2018

 

Sound Energy plc

("Sound Energy" or the "Company")

 

HALF YEARLY REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2018

 

Sound Energy, the Morocco focused upstream gas company, announces its unaudited half year report for the six months ended 30 June 2018.

 

HALF YEAR HIGHLIGHTS

 

Morocco

·     Completion of 2,850 line kilometre seismic programme in Eastern Morocco, fully funded by Schlumberger

·     Application for Production Concession for Tendrara gas discovery (subsequently awarded post period end)

·     Approval of Environmental Impact Assessment for TE-9 and TE-10 wells at the Tendrara-Labkir permit, with ground works now underway at TE-9

·     Heads of terms with a consortium for the front end engineering and design, construction and financing of a 20 inch pipeline and associated facilities under a 'build-own-operate-transfer' (BOOT) structure.  

Corporate

·     Continued strong safety record

·     Cash balance at 30 June 2018 of £14.7 million plus successful equity raise of US$15 million (£11.4 million) (before costs) in July 2018

·     Completion of Italy exit with consideration shares in Coro Energy plc distributed directly to Sound Energy shareholders

·     David Clarkson appointed as non-executive director; JJ Traynor appointed as executive director

 

 

For further information please contact:

 

Vigo Communications - PR Adviser

Patrick d'Ancona

Chris McMahon

Kate Rogucheva

 

Tel: +44 (0)20 7390 0230

Sound Energy

James Parsons, Chief Executive Officer JJ Traynor, Chief Financial Officer

 

 

j.parsons@soundenergyplc.com jj.traynor@soundenergyplc.com

Smith & Williamson - Nominated Adviser

Azhic Basirov

David Jones

Ben Jeynes

 

Tel: +44 (0)20 7131 4000

RBC Capital Markets - Joint Broker

Matthew Coakes

Martin Copeland

 

Tel: +44 (0)20 7653 4000

Macquarie Capital (Europe) Limited - Joint Broker

Alex Reynolds

Nick Stamp

 

Tel: +44 (0)20 3031 2000

 

 

Statement from the Chairman and Chief Executive Officer  

"Our priority so far this year has been the de-risking in Eastern Morocco of both our existing discovery and our significant exploration potential. The Company is now ready for this next, potentially transformational, period of exploration drilling."

The Company continues to believe that the TAGI and Paleozoic plays across Tendrara, Anoual and Matarka have the potential to become a material hydrocarbon province transforming both the Company and the Moroccan gas industry. The first half of 2018 has been an incredibly busy period, albeit largely behind the scenes.

The Company has made progress in both developing the existing discovery and in de-risking the exploration potential, including:

·     the closing out of the Eastern Morocco seismic programme, where early results have already enabled the finalisation of the TE-9 and TE-10 well locations

·     securing of a new 8 year licence combining Tendrara and Matarka

·     formal submission of the production concession application for the existing discovery at Tendrara (subsequently awarded in September 2018)

·     award of FEED and signing of a Heads of Terms covering the infrastructure, including a 20 inch pipeline, with a consortium including Enagas

·     Commencement of the process to introduce Schlumberger directly onto the Eastern Morocco licences

·     award of a new Petroleum Agreement for Sidi Moktar

 

Eastern Morocco

We continue to deepen our knowledge of the Eastern Morocco basin through, in part, the recently completed US$27.2 million seismic programme fully funded by Schlumberger, one of our strategic partners. This work, completed in August 2018, has supported our new Eastern Morocco basin model and is critical to minimising the risk of our rapidly approaching drill programme. Preparations for the first well, TE-9, targeting the A1 structure at Tendrara are complete with the EIA approval secured, a successful CPR issued and ground works now well under way. The Company hopes that the A1 prospect will unlock significant value for the Company, reduce the risk on nearby leads and increase further our overall confidence in the broader TAGI structural play. Preparations also continue apace on the subsequent TE-10 and TE-11 wells.

Excellent progress has also been made on the development of our existing discovery. The Company submitted the production concession application in June 2018 and the production concession was subsequently awarded in September 2018. A Heads of Terms for front end engineering and design (FEED) for a 20 inch pipeline and production facilities was signed with the consortium of Enagas, Elecnor and Fomento who bring strong industry expertise and capabilities. Following this competitive process and negotiation an innovative 'build-own-operate-transfer' (BOOT) structure was agreed with the consortium which further underpins the financial robustness of the development. Positive discussions continue to agree the gas sales agreement (GSA) for offtake which forms a key building block to support project sanction.

The Company continues to maintain a strong focus on health, safety, environment and the community, and work has recently begun in partnership with a local charity on the renovation of the Matarka health care centre.

Sidi Moktar

The Company views our Sidi Moktar licences as an exciting opportunity to explore for high impact prospectivity, within the pre-salt Triassic and Palaeozoic plays in the underexplored Essaouira Basin. In June we were delighted to receive Ministerial approval of a new 8 year Sidi Moktar Onshore Petroleum Agreement. The Company continues to progress a potential farm down, whilst retaining operatorship of the permits, ahead of further exploration operations in 2019.

Italy

The sale of the Company's Italian assets was completed in April. Work continues with the new owners on the preparation of the Badile land, to which the Company retains its economic rights to receive the proceeds, for a future sale.

Corporate

The Company remains in a strong financial position for the second half of 2018 with 30 June 2018 cash balances of US$19.4 million and, following the period end, the Company successfully completing an equity placing of US$15 million before expenses.

The Company has significantly strengthened the Board during 2018 with Richard Liddell being appointed as Non-Executive Chairman, David Clarkson joining as a non-executive director and JJ Traynor, the Company's Chief Financial Officer, joining the Board.  

Richard Liddell Non-Executive Chairman

James Parsons Chief Executive Officer

 

 

CONDENSED INTERIM CONSOLIDATED INCOME STATEMENT

 

Notes

Six months ended

30 June 2018

Unaudited £'000s

Six months ended

 30 June  2017

Unaudited  £'000s

Year

ended

 31 Dec

2017

Audited £'000s

Continuing operations

 

 

 

 

Administrative expenses

 

(4,077)

(3,976)

(8,458)

Group operating loss from continuing operations

 

(4,077)

(3,976)

(8,458)

Finance revenue

 

35

9

23

Foreign exchange gain

 

1,885

756

(914)

Other gains and (losses)

 

 

 

 

- derivative financial instruments

 

(80)

182

(1,873)

External interest costs

 

(1,195)

(45)

(1,117)

Profit/(loss) for period from continuing operations before taxation

 

(3,432)

(3,074)

(12,339)

Tax credit/(expense)

 

-

-

-

Profit/(loss) for period from continuing operations after taxation

 

(3,432)

(3,074)

(12,339)

 

 

 

 

 

Discontinued operations

 

 

 

 

Profit/(loss) from discontinued operations

8

5,236

(16,140)

(21,811)

Total profit/(loss) for the period

 

1,804

(19,214)

(34,150)

 

 

 

 

 

Other comprehensive (loss)/income

 

 

 

 

Foreign currency translation income/(loss)

 

2,872

(167)

(5,361)

Total comprehensive profit/(loss) for the period attributable to equity holders of the parent

 

4,676

(19,381)

(39,511)

 

 

 

 

 

 

 

Pence

Pence

Pence

Basic and diluted profit/(loss) per share for the period from continuing and discontinued operations attributable to equity holders of the parent

3

0.17

(2.73)

(4.28)

Basic and diluted loss per share for the period from continuing operations attributable to equity holders of the parent

3

(0.34)

(0.44)

(1.54)

 

 

 

CONDENSED INTERIM CONSOLIDATED BALANCE SHEET As at 30 June 2018

 

Notes

30 June 2018

Unaudited

£'000s

 30 June  2017

Unaudited

£'000s

 31 Dec

2017

Audited

 £'000s

Non-current assets

 

 

 

 

Property, plant and equipment

 

680

1,811

372

Intangible assets

4

170,585

31,828

163,939

Land and buildings

 

-

1,581

-

 

 

171,265

35,220

164,311

Current assets

 

 

 

 

Inventories

 

602

705

628

Other receivables

5

8,235

6,087

3,526

Derivative financial instruments

 

-

2,135

80

Prepayments

 

227

201

117

Cash and short term deposits

 

14,664

38,532

21,198

 

 

23,728

47,660

25,549

Assets of the Group held for sale

 

-

-

12,292

Total assets

 

194,993

82,880

202,152

Current liabilities

 

 

 

 

Trade and other payables

 

5,925

10,649

6,601

Provisions

 

-

1,406

-

 

 

5,925

12,055

6,601

Liabilities of the Group held for sale

 

-

-

4,492

Non-current liabilities

 

 

 

 

Deferred tax liabilities

 

-

433

-

Loans due in over one year

6

19,290

17,632

18,566

Provisions

 

-

1,876

-

 

 

19,290

19,941

18,566

Total liabilities

 

25,215

31,996

29,659

Net assets

 

169,778

50,884

172,493

Capital and reserves

 

 

 

 

Share capital and share premium

 

10,974

147,371

287,829

Warrant reserve

 

4,090

4,090

4,090

Foreign currency reserve

 

(2,579)

1,276

(3,918)

Accumulated surplus/(deficit)

 

157,293

(101,853)

(115,508)

Total equity

 

169,778

50,884

172,493

 

 

CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY  

 

Share

capital

£'000s

Share

premium

£'000s

Shares

 to be issued

 £'000s

Accumulated

surplus/ (deficit)

£'000s

Warrant

reserve

£'000s

Foreign currency

reserves

£'000s

Total

equity

£'000s

At 1 January 2018

10,159

277,670

-

(115,508)

4,090

(3,918)

172,493

Total profit for the period

-

-

-

1,804

-

-

1,804

Other comprehensive income

-

-

-

-

-

2,872

2,872

Total comprehensive income for the period

-

-

-

1,804

-

2,872

4,676

Reclassification to profit and loss account on Italy divestment

-

-

-

-

-

(1,533)

(1,533)

Reclassification on share premium account cancellation

-

(277,738)

-

277,738

-

-

-

Distribution to shareholders on Italy divestment

-

-

-

(7,994)

-

-

(7,994)

Issue of share capital

41

842

-

-

-

-

883

Share based payments

-

-

-

1,253

-

-

1,253

At 30 June 2018 (unaudited)

10,200

774

-

157,293

4,090

(2,579)

169,778

 

 

Share

capital

£'000s

Share

premium

£'000s

Shares

 to be issued

 £'000s

Accumulated

deficit

 £'000s

Warrant

reserve

£'000s

Foreign currency

reserves

£'000s

Total

equity

£'000s

At 1 January 2017

6,651

129,016

223

(84,213)

4,459

1,443

57,579

Total loss for the year

-

-

-

(34,150)

-

-

(34,150)

Other comprehensive loss

-

-

-

-

-

(5,361)

(5,361)

Total comprehensive loss

-

-

-

(34,150)

-

(5,361)

(39,511)

Issue of share capital

3,490

148,449

-

-

-

-

151,939

Reclassification on share issue

18

205

(223)

-

-

-

-

Reclassification on debt settlement

-

-

-

369

(369)

-

-

Share based payments

-

-

-

2,486

-

-

2,486

At 31 December 2017

10,159

277,670

-

(115,508)

4,090

(3,918)

172,493

 

 

Share

capital

£'000s

Share

premium

£'000s

Shares

 to be issued

 £'000s

Accumulated

deficit

£'000s

Warrant

reserve

£'000s

Foreign currency

reserves

£'000s

Total

equity

£'000s

At 1 January 2017

6,651

129,016

223

(84,213)

4,459

1,443

57,579

Total loss for the period

-

-

-

(19,214)

-

-

(19,214)

Other comprehensive income

-

-

-

-

-

(167)

(167)

Total comprehensive income for the period

-

-

-

(19,214)

-

(167)

(19,381)

Reclassification on debt settlement

-

-

-

369

(369)

-

-

Reclassification on share issue

18

205

(223)

-

-

-

-

Issue of share capital

646

10,835

-

-

-

-

11,481

Share based payments

-

-

-

1,205

-

-

1,205

At 30 June 2017 (unaudited)

7,315

140,056

-

(101,853)

4,090

1,276

50,884

 

 

CONDENSED INTERIM CONSOLIDATED CASH FLOW STATEMENT  

Notes

Six months

ended

30 June 2018 Unaudited £'000s

Six months

ended

30 June

2017 Unaudited £'000s

Year

ended

31 Dec

2017

Audited £'000s

Cash flow from operating activities

 

 

 

 

Cash flow from operations

 

(1,202)

(3,308)

(11,849)

Interest received

 

61

37

102

Net cash flow from operating activities

 

(1,141)

(3,271)

(11,747)

Cash flow from investing activities

 

 

 

 

Capital expenditure and disposals

 

(382)

(370)

(478)

Exploration and development expenditure

 

(3,122)

(14,345)

(23,482)

Cash disposed with Italian operations

 

(2,655)

-

-

Net cash flow from investing activities

 

(6,159)

(14,715)

(23,960)

Proceeds from derivative financial instruments

 

-

-

592

Net proceeds from equity issue

 

607

9,813

11,550

Interest payments

 

(634)

(645)

(1,293)

Net cash flow from financing activities

 

(27)

9,168

10,849

Net decrease in cash and cash equivalents

 

(7,327)

(8,818)

(24,858)

Net foreign exchange difference

 

(20)

541

60

Cash and cash equivalents at the beginning of the period

 

22,011

46,809

46,809

Cash and cash equivalents at the end of the period

 

14,664

38,532

22,011

 

Notes

Six months

ended

30 June 2018 Unaudited £'000s

Six months

 ended

30 June

2017 Unaudited £'000s

Year

ended

 31 Dec

 2017

Audited

£'000s

Cash flow from operations reconciliation

 

 

 

 

Profit/(loss) before tax from continuing operations

 

(3,432)

(3,074)

(12,339)

Profit/(loss) before tax from discontinued operations

 

5,236

(16,140)

(21,866)

Total profit/(loss) for the period before tax

 

1,804

(19,214)

(34,205)

Finance revenue

 

(61)

(37)

(102)

Impairment of goodwill

 

-

-

55

Exploration expenditure written off and impairment of assets

 

-

15,124

19,833

Gain on disposal of Italian operations

8

(3,967)

-

-

Decrease in accruals and short term payables

 

(379)

(2,327)

(5,783)

Depreciation

 

176

331

406

Share based payments charge and bonuses paid in shares

 

1,529

1,205

2,486

Decrease/(Increase) in drilling inventories

 

28

(374)

(430)

Loss/(gain) on derivative financial instruments

 

80

(182)

1,873

Finance costs and exchange differences

 

(690)

(643)

2,158

Foreign currency translation gain reclassified from other comprehensive income

8

(1,533)

-

-

Decrease in short term receivables and prepayments

 

1,811

2,809

1,860

Cash flow from operations

 

(1,202)

(3,308)

(11,849)

 

 

 

NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

 

1. Basis of preparation

The condensed interim consolidated financial statements do not represent statutory accounts within the meaning of section 435 of the Companies Act 2016. The financial information for the year ended 31 December 2017 is based on the statutory accounts for the year ended 31 December 2017. Those accounts, upon which the auditors issued an unqualified opinion, have been delivered to the Registrar of Companies and did not contain statements under section 498(2) or (3) of the Companies Act 2006.

The condensed interim financial information is unaudited and has been prepared on the basis of the accounting policies set out in the Group's 2017 statutory accounts, except for the adoption of IFRS 9, Financial instruments which did not have a material impact on the condensed interim financial information and in accordance with IAS 34 Interim Financial Reporting. IFRS 15, Revenue from contracts with customers and several other amendments and interpretations apply for the first time in 2018, but do not have an impact on the condensed interim consolidated financial statements of the Group.

The seasonality or cyclicality of operations does not impact on the interim financial statements.

 

2. Segment information

The Group categorises its operations into three business segments based on Corporate, Exploration and Appraisal and Development and Production. The Group's Exploration and Appraisal activities are carried out in Morocco. The Group's reportable segments are based on internal reports about the components of the Group which are regularly reviewed by the Board of Directors, being the Chief Operating Decision Maker (''COMD''), for strategic decision making and resources allocation to the segment and to assess its performance. The segment results for the period ended 30 June 2018 are as follows:

Segment results for the period ended 30 June 2018

 

Corporate £'000s

Development & Production £'000s

Exploration & Appraisal £'000s

Total

 £'000s

Administration expenses

(4,077)

-

-

(4,077)

Operating loss segment result

(4,077)

-

-

(4,077)

Finance revenue

35

-

-

35

Gain/(loss) on derivative financial instruments

(80)

-

-

(80)

Finance costs and exchange adjustments

690

-

-

690

Loss for the period before taxation

(3,432)

-

-

(3,432)

 

The segments assets and liabilities at 30 June 2018 are as follows:

 

Corporate £'000s

Development & Production £'000s

Exploration & Appraisal £'000s

Total

£'000s

Capital expenditure

680

-

170,585

171,265

Other assets

19,999

-

3,729

23,728

Total liabilities

(21,080)

-

(4,135)

(25,215)

 

The geographical split of non-current assets is as follows:

 

UK

£'000s

Morocco

£'000s

Fixtures, fittings and office equipment

148

532

Exploration and evaluation assets

-

170,449

Software

45

91

Total

193

171,072

 

Segment results for the period ended 30 June 2017

 

Corporate £'000s

Development & Production £'000s

Exploration

& Appraisal

£'000s

Total

 £'000s

Administration expenses

(3,976)

-

-

(3,976)

Operating loss segment result

(3,976)

-

(3,976)

Finance revenue

9

-

-

9

Gain on derivative financial instruments

182

-

-

182

Finance costs and exchange adjustments

711

-

-

711

Profit/(loss) for the period before taxation

(3,074)

-

-

(3,074)

The segments assets and liabilities at 30 June 2017 were as follows:

 

 

Corporate £'000s

Development & Production £'000s

Exploration

& Appraisal

£'000s

Total

£'000s

Capital expenditure

512

-

26,763

27,275

Other assets

38,561

-

3,371

41,932

Liabilities attributable to continuing operations

(18,980)

-

(5,689)

(24,669)

 

The geographical split of non-current assets is as follows:

 

UK

£'000s

Morocco

£'000s

Fixtures, fittings and office equipment

192

232

Exploration and evaluation assets

-

26,622

Software

88

141

Total

280

26,995

The segmental results as at 30 June 2017 excludes the results of discontinued operations.

Segment results for the year ended 31 December 2017

 

Corporate

£'000s

Development

& Production

£'000s

Exploration &

Appraisal

£'000s

Total

£'000s

Administration expenses

(8,458)

-

-

(8,458)

Operating loss segment result

(8,458)

-

-

(8,458)

Interest receivable

23

-

-

23

Loss on derivative financial instruments

(1,873)

-

-

(1,873)

Finance costs and exchange adjustments

(2,031)

-

-

(2,031)

Loss for the period before taxation from continuing operations

(12,339)

-

-

(12,339)

 

The segments assets and liabilities at 31 December 2017 were as follows:

 

Corporate

£'000s

Development

& Production

£'000s

Exploration &

Appraisal

£'000s

Total

£'000s

Non-current assets

372

-

163,939

164,311

Current assets

21,701

-

3,848

25,549

Liabilities attributable to continuing operations

(20,165)

-

(5,002)

(25,167)

 

The geographical split of non-current assets is as follows:

 

UK

£'000s

Morocco £'000

Fixtures, fittings and office equipment

177

195

Exploration and evaluation assets

-

163,737

Software

66

136

Total

243

164,068

3. Profit/(loss) per share

The calculation of basic profit/(loss) per Ordinary Share is based on the profit/(loss) after tax and on the weighted average number of Ordinary Shares in issue during the period. The calculation of diluted profit/(loss) per share is based on the profit/(loss) after tax on the weighted average number of ordinary shares in issue plus weighted average number of shares that would be issued if dilutive options and warrants were converted into shares. Basic and diluted profit/(loss) per share is calculated as follows:

 

30 June

2018

£'000

30 June

2017

£'000

 

31 December

2017

£'000

Loss after tax from continuing operations

(3,432)

(3,074)

(12,339)

Profit/(loss) after tax from discontinued operations

5,236

(16,140)

(21,811)

Total profit/(loss) for the period

1,804

(19,214)

(34,150)

 

 

 

million

million

million

Weighted average shares in issue

1,019

703

799

Dilutive potential ordinary shares

33

-

-

Diluted weighted average number of shares

1,052

703

799

 

Basic profit/(loss) per share

 

Pence

Pence

Pence

Basic loss per share from continuing operations

(0.34)

(0.44)

(1.54)

Basic profit/(loss) per share from discontinued operations

0.51

(2.29)

(2.74)

Basic profit/(loss) per share from continuing and discontinued operations

0.17

(2.73)

(4.28)

 

Diluted profit/(loss) per share

 

Pence

Pence

Pence

Diluted loss per share from continuing operations

(0.34)

(0.44)

(1.54)

Diluted profit/(loss) per share from discontinued operations

0.50

(2.29)

(2.74)

Diluted profit/(loss) per share from continuing and discontinued operations

0.17

(2.73)

(4.28)

The effect of the potential dilutive shares noted above on the earnings per share from continuing operations would be anti-dilutive and therefore are not included in the above calculation of diluted earnings per share from continuing operations.

4. Intangibles

 

 

30 June

 2018

Unaudited £'000s

 

30 June

2017

Unaudited

£'000s

 

 31 Dec

2017

 Audited

£'000s

Cost

 

 

 

At start of period

164,018

42,386

42,386

Additions

3,408

18,186

165,762

Exchange adjustments

3,304

(284)

(5,986)

Reclassification to assets of disposal group held for sale

-

-

(38,144)

At end of period

170,730

60,288

164,018

Impairment and Depreciation

 

 

 

At start of period

79

14,326

14,326

Charge for period

64

13,761

19,190

Exchange adjustments

2

373

(85)

Reclassified to assets of disposal group held for sale

-

-

(33,352)

At end of period

145

28,460

79

Net book amount

170,585

31,828

163,939

 

5. Other receivables

 

 

30 June

 2018

Unaudited

£'000s

 

30 June

2017

Unaudited

£'000s

 

 31 Dec

2017

Audited

£'000s

Italian Vat refundable

2,730

-

-

Badile land proceeds receivable

1,592

-

-

Other receivable

3,913

6,087

3,526

 

8,235

6,087

3,526

 

6. Loans and Borrowings

 

 

30 June

 2018

Unaudited

£'000s

 

30 June

2017

Unaudited

£'000s

 

 31 Dec

2017

Audited

£'000s

Non-current liability

 

 

 

5-year secured bonds

19,290

17,632

18,566

 

19,290

17,632

18,566

 

The Company has 5-year non-amortising secured bonds with an aggregate value of €28.8 million. The bonds are secured over the share capital of Sound Energy Morocco South Limited, have a 5% coupon and were issued at a 32% discount to par value. Alongside the bonds, the Company issued 70,312,500 warrants to subscribe for new ordinary shares in the Company at an exercise price of 30 pence per ordinary share and an exercise period of approximately five years, concurrent with the term of the bonds. The effective interest rate is approximately 16.3%. The 5-year secured bonds are due in June 2021.  

7. Shares in issue and share based payments

As at 30 June 2017, the Company had 1,019,954,543 ordinary shares in issue. In the period to 30 June 2018, a total of 0.9 million warrants were exercised for total proceeds of £0.2 million.

During the period to 30 June 2018, the Company granted 2.8 million restricted stock units awards to staff under its long term incentive plan. Approximately 2.5 million share options were exercised and 2.2 million expired during the period.  

8. Discontinued operations

On 5 October 2017, the Company announced that it had entered into non-binding conditional heads of terms with Saffron Energy plc (''Saffron'') and Po Valley Energy Limited under which it was proposed that the Company disposed of its portfolio of Italian interests and permits through the sale of Sound Energy Holdings Italy (''SEHIL'') and Apennine Energy SpA (''APN'') (the ''disposal'') for the consideration of 185,907,500 new ordinary shares in Saffron (subsequently renamed Coro Energy plc) issued directly to the Company's shareholders. On 23 January 2018, the Company announced that it had entered into a binding agreement with Saffron for the disposal and the transaction completed on 9 April 2018. The value of the 185, 907, 500 Coro Energy plc shares distributed to the Company's shareholders was £8.0 million using the completion date share price of 4.3 pence.

The results of the Italian operations for the period are presented below:

 

Six months ended

30 June 2018*

Unaudited

£'000

Six months ended

30 June 2017

Unaudited

£'000

Twelve months ended

31 December 2017

Audited

£'000

Revenue

140

378

708

Operating costs

(170)

(169)

(697)

Impairment of Intangible assets and goodwill

-

(13,761)

(19,073)

Exploration costs

(25)

(1,362)

(761)

Gross loss

(55)

(14,914)

(19,823)

Administrative expenses

(235)

(1,186)

(1,995)

Operating loss from discontinued operations

(290)

(16,100)

(21,818)

Finance revenue

26

28

79

Foreign exchange gain

-

4

4

Finance costs

-

(72)

(131)

Foreign currency translation gain reclassified from other comprehensive income

1,533

-

-

Gain on disposal of Italian operations

3,967

-

-

Profit/(loss) for the period before taxation from discontinued operations

5,236

(16,140)

(21,866)

Deferred tax credit

-

-

55

Profit/(loss) for the period after taxation from discontinued operations

5,236

(16,140)

(21,811)

*Represent the results for the period to divestment on 9 April 2018.

 

 

 

 

 

The net cash flows for the period were as follows:

 

 

Net cash flow from operating activities

1,897

1,049

(2,513)

Net cash flow from investing activities

-

(9,649)

(13,962)

Net cash flow from financing activities

-

-

-

Net cash outflow

1,897

(8,600)

(16,475)

 

 

 

9. Post Balance Sheet events

On 2 July 2018, the Company announced that it had placed 30,829,308 new ordinary shares of 1p each at a placing price of 37p to raise approximately US$15 million before costs (approximately US$14.25 million after costs).

On 23 July 2018, the Company announced the initiation of the process of converting the existing 27.5% synthetic interests held by an affiliate of Schlumberger in the Tendrara Lakbir permits, the Anoual permits and the Matarka reconnaissance licence ("Eastern Morocco Portfolio") into 27.5% participating interests in the Eastern Morocco contract area. Sound Energy will remain the operator.

On 31 August 2018, the Company announced that it had signed a new 8 year petroleum agreement uniting the areas previously covered by the Tendrara petroleum agreement and the Matarka reconnaissance licence (''Greater Tendrara''). The agreement will become effective on approval of the Moroccan Energy and Finance Ministries. The Company will hold an operated 47.5% interest, Schlumberger 27.5% interest and the remaining 25% by L'Office National des Hydrocarbures et des Mines (''ONHYM''),the Moroccan state regulator for petroleum operations.

On 6 September 2018, the Company announced the award by the Moroccan Ministry of Energy of the production concession relating to the Tendrara gas discovery in Eastern Morocco. The production concession award covers an area of 133. 5 Km.

 

 

This announcement is inside information for the purposes of Article 7 of Regulation 596/2014.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
END
 
 
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Date   Source Headline
19th Sep 20197:00 amRNSSound Energy PLC - Half-year Report
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14th Aug 20197:00 amRNSSound Energy PLC - Board Change Update
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