1 Oct 2008 07:00
RNS Number : 7519E
Spitfire Oil Limited
01 October 2008
SPITFIRE OIL
60 St James’s Street, London SW1A 1LE, United Kingdom
Telephone: + 44 (0)20 7629 7774 Facsimile: + 44 (0)20 7629 7773
PRELIMINARY RESULTS
Spitfire Oil Limited (“Spitfire Oil” or the “Company”), has today published its results for the period ended 30 June 2008, a summary of which is attached.
Spitfire Oil was incorporated on 2 May 2007 and on 11 July 2007 acquired the entire issued capital of Spitfire Oil Pty Ltd (formerly Hurricane Fuels Pty Ltd) (together “the Group”) by way of a share swap. On 18 July 2007 Spitfire Oil’s shares were admitted to trading on the Alternative Investment Market ("AIM") of the London Stock Exchange. At the same time the Company placed 16,666,667 new Ordinary Shares at 60p per share to raise £10,000,000 (A$23,298,000).
The Group’s principal activity is the pursuance of the production of fuel oil and distillate from the Salmon Gums Lignite deposits in Western Australia. As of 30 June 2008, the Company controlled 6 exploration tenements totalling 519 km2 near Salmon Gums, near Esperance, in the south east of Western Australia. The tenements contain a large lignite (brown coal) deposit with an Inferred Resource, calculated according to the JORC Code, of 500 million tonnes of lignite. The lignite has a high Kerogen (hydrocarbon) content convertible into oil using low temperature pyrolysis at a yield of 0.43 bbl / tonne. Extractable commercial oil reserves are estimated to exceed 200 million barrels.
The Group has reported a loss before tax A$2,828,901 in the period from incorporation to 30 June 2008.
During the period the Group:
·; Drilled 187 exploration holes totalling 6,618 metres and applied for two mining leases totalling 9,854 hectares.
·; Began a 2 year, A$4.4 million contract with Curtin University to prove its L2VTM low temperature pyrolysis technology. A new laboratory and a prototype reactor were constructed, specialist research personnel were recruited and technical work started.
·; The Environmental approval process was initiated and the project was assessed at the Environmental Review and Management Plan level.
·; A new Chief Executive was recruited with world class experience in the construction of large oil & gas processing plants and in environmentally sensitive projects based in Western Australia. All management functions have been transferred to Perth.
The near term objectives of Spitfire are now to:
·; Complete an exploration drilling program to calculate an Indicated Resource under the JORC Code and apply for additional mining leases as applicable.
·; Complete the L2VTM Pyrolysis tests at Curtin University and complete conceptual mine and process engineering studies to deliver a definitive feasibility study and a design basis for a phase 1 commercial plant.
·; Progress the environmental approval process.
Chairman’s Statement
“For an entity only admitted to trading on the Alternative Investment Market of the London Stock Exchange in July 2007, its progress towards proof of concept and commercialization has been impressive.
Although the events of the past month have been particularly devastating for the world financial system which, to some extent has been or will be passed through to the world economy, the gratifying aspect for the Company of these calamitous events has been the continuing high price for crude oil and distillates. This, coupled with the ever decreasing size of the world’s recoverable oil reserves, gives real hope that the Company will reap significant financial rewards should the Salmon Gums project come into commercial operation.
It has been heartening to see the progress that has been made to move the Company ever closer to commercialization. Resource delineation, exploration and environmental approvals have all made sizeable move forwards. The focus this year shifts to the laboratory to ensure oil yields are extractable and by products of the Pyrolysis process do not cause any negative impacts to either the extraction process or the environment. We remain ever hopeful of that those results will be extremely positive.
Needless to say, the Company also has not been blinded to other means to grow shareholder value. In that respect, the Company has evaluated a number of other oil and gas projects. At this stage, most of these projects do not meet the risk profile or the financial returns required by the Company.”
| Further information | |
| | |
| Mladen Ninkov – Chairman | Telephone: +44(0)20 7629 7774 |
| Roger Goodwin – Director | |
| Spitfire Oil Limited | |
| | |
| Adrian Hadden | Telephone: +44(0)20 7523 8353 |
| Collins Stewart Europe Limited | |
Spitfire Oil Limited’s shares are quoted on the Alternative Investment Market (AIM) of the London Stock Exchange (symbol SRO).
The Company’s news releases are available on the Company’s web site: www.spitfireoil.com
SPITFIRE OIL PTY LIMITED
Income Statement
For the period ended 30 June 2008
(expressed in Australian dollars)
| | | | |
| | Consolidated Group | | Parent Entity |
| | 2008 | | 2008 |
| A$ | | A$ | |
| | | | |
| Other Revenue | 1,251,885 | | 949,590 |
| | | | |
| Corporate expenses | (1,410,557) | | (1,035,345) |
| Impairment of goodwill | (534,439) | | - |
| Technology and development | (1,883,681) | | - |
| Other expenses | (234,326) | | (2,743,146) |
| Promotion and investor relations | (17,783) | | - |
| Loss before income tax | (2,828,901) | | (2,828,901) |
| Income tax expense | - | | - |
| Loss for the period | (2,828,901) | | (2,828,901) |
| | | | |
| Basic loss per share (cents per share) | (7.06) | | |
| | | | |
| Diluted loss per share (cents per share) | (7.06) | | |
| | | | |
| | | | |
Spitfire Oil pty Limited
Balance Sheet
As at 30 June 2008
(expressed in Australian dollars)
| | | | |
| | Consolidated Group | | Parent Entity |
| | 2008 | | 2008 |
| A$ | | A$ | |
| ASSETS | | | |
| CURRENT ASSETS | | | |
| Cash and cash equivalents | 14,100,639 | | 14,037,046 |
| Trade and other receivables | 194,553 | | - |
| Other current assets | 36,270 | | 36,270 |
| TOTAL CURRENT ASSETS | 14,331,462 | | 14,073,316 |
| | | | |
| NON-CURRENT ASSETS | | | |
| Trade and other receivables | - | | 2,556,540 |
| Other assets | - | | 1,465 |
| Property, plant and equipment | 41,220 | | - |
| Intangible assets | 3,416,172 | | - |
| TOTAL NON-CURRENT ASSETS | 3,457,392 | | 2,558,005 |
| | | | |
| TOTAL ASSETS | 17,788,854 | | 16,631,321 |
| | | | |
| LIABILITIES | | | |
| CURRENT LIABILITIES | | | |
| Trade and other payables | 1,172,319 | | 14,786 |
| TOTAL CURRENT LIABILITIES | 1,172,319 | | 14,786 |
| | | | |
| TOTAL LIABILITIES | 1,172,319 | | 14,786 |
| | | | |
| NET ASSETS | 16,616,535 | | 16,616,535 |
| | | | |
| EQUITY | | | |
| Issued capital | 20,854,412 | | 20,854,412 |
| Reserves | (1,408,976) | | (1,408,976) |
| Accumulated loss | (2,828,901) | | (2,828,901) |
| TOTAL EQUITY | 16,616,535 | | 16,616,535 |
| | | | |
Spitfire Oil Pty Limited
Statement of Changes in Equity
For the period ended 30 June 2008
(expressed in Australian dollars)
| | | | ||||
| | | Consolidated Group | ||||
| | | | | | | |
| | | Issued Capital | Foreign Currency Translation | Accumulated Losses | Share Based Remuneration | Total |
| | A$ | A$ | A$ | A$ | A$ | |
| Balance at 2 May 2007 | - | - | - | - | - | |
| Shares issued | 23,300,973 | - | - | - | 23,300,973 | |
| Share issuance costs | (2,446,561) | - | - | - | (2,446,561) | |
| Share based remuneration | - | - | - | 592,667 | 592,667 | |
| Translation of Foreign currency | - | (2,001,643) | - | - | (2,001,643) | |
| Net (Loss) for the period | - | - | (2,828,901) | - | (2,828,901) | |
| Balance at 30 June 2008 | 20,854,412 | (2,001,643) | (2,828,901) | 592,667 | 16,616,535 | |
| | | | | | | |
| | | Parent Entity | ||||
| | | | | | | |
| | | Issued Capital | Foreign Currency Translation | Accumulated Losses | Share Based Remuneration | Total |
| | A$ | A$ | A$ | A$ | A$ | |
| Balance at 2 May 2007 | - | - | - | - | - | |
| Shares issued | 23,300,973 | - | - | - | 23,300,973 | |
| Share issuance costs | (2,446,561) | - | - | - | (2,446,561) | |
| Share based remuneration | - | - | - | 592,667 | 592,667 | |
| Translation of Foreign currency | - | (2,001,643) | - | - | (2,001,643) | |
| Net (Loss) for the period | - | - | (2,828,901) | - | (2,828,901) | |
| Balance at 30 June 2008 | 20,854,412 | (2,001,643) | (2,828,901) | 592,667 | 16,616,535 | |
| | | | | | | |
Spitfire Oil PtyLimited
Cash Flow Statement
For the period ended 30 June 2008
(expressed in Australian dollars)
| | | | | | |
| | | | Consolidated Group | | Parent Entity |
| | | | 2008 | | 2008 |
| | | | A$ | | A$ |
| CASH FLOWS RELATED TO OPERATING ACTIVITIES | | | | | |
| | | | | | |
| Payments to suppliers and employees | | | (2,818,468) | | (570,515) |
| Interest received | | | 965,664 | | 949,590 |
| R&D tax concession received | | | 277,788 | | - |
| CASH FLOWS USED IN OPERATING ACTIVITIES | | | (1,577,016) | | 379,075 |
| CASH FLOWS RELATED TO INVESTING ACTIVITIES | | | | | |
| | | | | | |
| Advances to subsidiary | | | - | | (5,193,333) |
| Payment for purchases of plant and equipment | | | (45,262) | | - |
| Payment for purchases of equity investments | | | - | | (1,465) |
| Exploration Expenditure | | | (3,131,852) | | - |
| CASH FLOWS USED IN INVESTING ACTIVITIES | | | (3,177,114) | | (5,194,798) |
| CASH FLOWS RELATED TO FINANCING ACTIVITIES | | | | | |
| | | | | | |
| Proceeds from issues of securities | | | 20,854,412 | | 20,854,412 |
| CASH FLOW FROM FINANCING ACTIVITIES | | | 20,854,412 | | 20,854,412 |
| | | | | | |
| NET INCREASE IN CASH AND CASH EQUIVALENTS | | | 16,102,282 | | 16,038,689 |
| | | | | | |
| Cash and cash equivalents at the beginning of the year | | | - | | - |
| Effects of exchange rate changes on cash and cash equivalents | (2,001,643) | | (2,001,643) | ||
| CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR | | 14,100,639 | | 14,037,046 | |
Notes:
1. Spitfire Oil Limited was incorporated on 2 May 2007.
2. This statement has been prepared using accounting policies and presentation consistent with those applied in the preparation of the statutory accounts of the Group.
3. The summary accounts set out above do not constitute statutory accounts as defined by Section 84 of the Bermuda Companies Act 1981 or Section 240 of the UK Companies Act 1985. The summarised consolidated and parent balance sheets at 30 June 2008 and the summarised consolidated and parent income statements, consolidated and parent statements of changes in equity and the summarised consolidated and parent cash flow statements for the period then ended have been extracted from the Group’s 2008 statutory financial statements upon which the auditors’ opinion is unqualified. The statutory financial statements for the period 2 May 2007 to 30 June 2008 have been prepared in accordance with the requirements of International Accounting Standard IAS1: Presentation of Financial Statements as adopted in Australia.
4. The annual report and accounts for 2008 are being sent by post to all registered shareholders. Additional copies of the annual report and accounts are available from the Company’s London correspondent office, 6th Floor, 60 St James’s Street, London, SW1A 1LE.
5. The calculation of the basic losses per share is based on the loss attributable to ordinary shareholders of A$2,828,901 divided by the weighted average number of shares in issue during the year of 40,050,309. There is no dilutive effect of share purchase options.
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