14 Jan 2009 07:00
14 January 2009
Sirius Petroleum PLC
(Formerly Global Gaming Technologies PLC)
("Sirius" or "the Company" or "the Group")
Preliminary results for the year ended 31 July 2008
Sirius (Ticker: SRSP.L) announces preliminary results for the financial year ended 31 July 2008, a period when the Group was reviewing potential acquisition opportunities and considering its future strategy and during which no trading activities took place. These financial results pre-date the recent fundraising exercise and change in strategy and so do not reflect any of the fundamental changes which have taken place since the year-end.
Implementation of new Strategy
Commenting, Babatunde Agboola, Chairman of Sirius Petroleum plc, said:
"The Company will continue to build on the developments made in the period and to a successful acquisition of oil and natural gas opportunities in Nigeria in the coming months."
A notice convening the Company's annual general meeting ("AGM") along with the financial statements will be posted to shareholders shortly. The AGM will be held at 10.00 a.m. on 10 February 2009 at the offices of Fladgate LLP, 25 North Row, London W1K 6DJ.
A copy of the results will be posted on the Company's website today at: www.siriuspetroleum.com
Enquiries:
| Hansard Group, John Bick | tel: +44(0)7872 061007 |
| Canaccord Adams Limited, Neil Johnson/Andrew Chubb | tel: +44 (0) 207 050 6500 |
Sirius Petroleum PLC
Chairman's Statement
Introduction
I am pleased to have joined the Board of Sirius Petroleum Plc (formerly Global Gaming Technologies Plc) in August 2008 as part of Sirius's first steps in the change of strategy to seek opportunities in the Oil and Gas sector. This is my first communication to shareholders as Chairman and, although we are at a very early stage of the development of our strategy, I shall endeavour to provide our shareholders and potential future investors with an outline of our vision for the Company's future.
Results
These results cover the year ended 31 July 2008, a period when the Group was reviewing potential acquisition opportunities and considering its future strategy and during which no trading activities took place. These financial results pre-date the recent fundraising exercise and change in strategy and so do not reflect any of the fundamental changes which have taken place since the year-end. The Group recorded a loss before tax of £194,800 (2007 : £878,247 after a share-based payments charge of £614,059 and the write off of goodwill of £100,000). There is a loss per share of 0.09p (2007: loss per share: 0.46p). The Company has had no substantive trading business since April 2007 when it was decided to cease the business of developing and using aggregation software in the gaming industry.
During the year, costs remained under strict control following the reorganization in 2007 and the directors serving during the period have taken minimal fees.
Loss of capital
Sirius's results show that the Company's net assets are less than half its paid up share capital. In such circumstances the directors of the Company are obliged by section 142 Companies Act 1985 to convene a general meeting for the purpose of considering whether any, and if so what, steps should be taken to deal with the Company's current financial position. We propose to consider this matter at the Company's annual general meeting, details of which are set out below, although no resolution will be put to the meeting on this issue.
Share capital
During the year ended 31 July 2008, Sirius issued 104,500,000 ordinary shares, raising £231,288, net of expenses, and converted a loan of £198,750 due to Corvus Capital Inc. Since the year end a further 204,700,000 shares have been issued, making the Company's issued share capital 502,494,385 ordinary shares with a nominal value of 0.25 pence each. Sirius Petroleum does not hold any ordinary shares in Treasury. Therefore, the total number of voting rights in the Company is 502,494,385 and this figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Service Authority's Disclosure and Transparency Rules.
Board and structural changes
In addition to my own appointment, the appointment of two additional new Non Executive directors, Toby Hayward and Olukayode Kuti brings further expertise and commercial relationships to the board. In conjunction with the Board changes, the company name has been changed to Sirius Petroleum plc to reflect the new strategy of the Group. The name of the Company's dormant subsidiary has also been changed to Sirius Gas & Oil Limited (formerly Event Data Correlation Limited).
Annual general meeting
A notice convening the Company's annual general meeting ("AGM") along with the financial statements will be posted to shareholders shortly. The AGM will be held at 10.00 a.m. on 10 February 2009 at the offices of Fladgate LLP, 25 North Row, London W1K 6DJ.
Operational update
In August 2008, Sirius announced that it has an agreement in place with Taglient Oil Nigeria Limited ("Taglient"), who have considerable knowledge and contacts within the Nigerian oil industry. Taglient has agreed to use these resources to garner interests in oil and gas fields in Nigeria on behalf of the Company. A Nigerian joint venture company, Sirius Taglient Petro Ltd has been formed to provide the local presence necessary for Sirius to benefit from the grant of permits and licenses in Nigeria.
On 4 December 2008, Sirius announced that it had entered into a strategic partnership letter of intent with Nigerian based Bolad Energy Company ("Bolad"), who will provide invaluable technical expertise and resources in the region. Upon a successful acquisition of an oil and gas asset, Bolad and Sirius will enter into a long-form joint venture agreement. This agreement will be for an initial term of 12 months and, if satisfactory to both parties, will continue for the life of the opportunities. It is intended that Bolad will not only act as operator of the oil fields acquired by Sirius, but it will also manage all aspects of the interface with the Nigerian government and local communities. In addition, on 19 December 2008, Sirius announced that it had entered into a second strategic partnership letter of intent with Nigerian Based RT5 Petroleum Limited ("RT5") who will also provide Sirius with access to opportunities in the Oil and Gas sector in Nigeria on an exclusive basis. As with the Bolad strategic partnership, upon the successful identification and acquisition of an opportunity by the Company, it is intended that RT5 and the Company will enter into a long-form joint venture agreement.
The Board is pleased with the progress to date and is confident that the first suitable marginal field opportunity will be identified during this calendar year. In August 2008, when the current directors' Service Contracts were approved, it was deemed appropriate to limit initial remuneration to £1,000 per director. Now that the Company is making progress towards its goal, the level of commitment from certain directors has increased such that the Board considers it appropriate to lift their remuneration above this minimum whilst maintaining a tight control of all costs to ensure that overall expenditure is kept well within the resources available to the Company.
The Company will continue to build on the developments made in the period and to a successful acquisition of oil and natural gas opportunities in the coming months.
Babatunde Agboola
Chairman
14 January 2009
CONSOLIDATED INCOME STATEMENT
For the year ended 31 July 2008
| 2008 | 2007 | ||
| Note | £ | £ | |
| Administrative expenses | |||
| - impairment of intangible assets - other | - (195,673) | (100,000) (779,673) | |
|
| |||
| Total administrative expenses | (195,673) | (879,673) | |
| Loss from operations | (195,673) | (879,673) | |
| Finance income | 873 | 1,426 | |
| Loss before taxation | (194,800) | (878,247) | |
| Taxation | 2 | - | - |
| Loss after taxation and loss attributable to the equity holders of the company | (194,800) | (878,247) | |
| Total and continuing loss per ordinary share (pence) | |||
| Basic and diluted | 3 | (0.09)p | (0.46)p |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
At 31 July 2008
| Share capital | Share premium | Share-based payment reserve | Retained earnings | Total equity | |
| £ | £ | £ | £ | £ | |
| At 1 August 2006 | 471,673 | 1,364,673 | 920,856 | (2,666,499) | 90,703 |
| Loss for the year and total and recognised income and expenses for the year | - | - | (878,247) | (878,247) | |
| Issue of share capital | 11,563 | - | - | - | 11,563 |
| Cost of issue of share capital | - | (1,443) | - | - | (1,443) |
| Share-based payment | - | - | 614,059 | - | 614,059 |
| At 31 July 2007 | 483,236 | 1,363,230 | 1,534,915 | (3,544,746) | (163,365) |
| Loss for the year and total and recognised income and expenses for the year | - | - | - | (194,800) | (194,800) |
| Issue of share capital | 261,250 | - | - | - | 261,250 |
| Proceeds of issue of share capital in excess of par value less costs | - | 168,788 | - | - | 168,788 |
| At 31 July 2008 | 744,486 | 1,532,018 | 1,534,915 | (3,739,546) | 71,873 |
CONSOLIDATED BALANCE SHEET
| 2008 | 2007 | ||
| Note | £ | £ | |
| ASSETS | |||
| Non-current assets | |||
| Intangible assets | - | - | |
| Current assets | |||
| Cash at bank | 223,904 | 29,809 | |
| Trade and other receivables | 33,192 | 22,898 | |
| Total current assets | 257,096 | 52,707 | |
| Total assets | 257,096 | 52,707 | |
| LIABILITIES | |||
| Current liabilities | |||
| Trade and other payables | 185,223 | 216,072 | |
| Total current liabilities | 185,223 | 216,072 | |
| Total liabilities | 185,223 | 216,072 | |
| EQUITY | |||
| Share capital | 4 | 744,486 | 483,236 |
| Share premium | 1,532,018 | 1,363,230 | |
| Share-based payments reserve | 1,534,915 | 1,534,915 | |
| Retained earnings | (3,739,546) | (3,544,746) | |
| Total equity attributable to equity holders of the Company | 71,873 | (163,365) | |
| Total equity and liabilities | 257,096 | 52,707 |
CONSOLIDATED CASH FLOW STATEMENT
| 2008 | 2007 | ||
| £ | £ | ||
| Cash flows from operating activities | |||
| Loss after taxation | (194,800) | (878,247) | |
| Impairment of goodwill | - | 100,000 | |
| Share based payment charge | - | 614,059 | |
| Finance income | (873) | (1,426) | |
| (Increase)/decrease in trade and other receivables | (10,294) | 901 | |
| Increase in trade and other payables | 75,026 | 20,160 | |
| Net cash outflow from operating activities | (130,941) | (144,553) | |
| Cash flows from investing activities | |||
| Finance income | 873 | 1,426 | |
| Net cash inflow from investing activities | 873 | 1,426 | |
| Cash flows from financing activities | |||
| Proceeds from issue of share capital | 249,998 | 11,563 | |
| Share issue costs | (18,710) | (1,443) | |
| Proceeds from new borrowings | 92,875 | 105,875 | |
| Net cash inflow from financing activities | 324,163 | 115,995 | |
| Net change in cash and cash equivalents | 194,095 | (27,132) | |
| Cash and cash equivalents at beginning of period | 29,809 | 56,941 | |
| Cash and cash equivalents at end of period | 223,904 | 29,809 |
1. Accounting policies
Basis of preparation
The Group financial statements have been prepared under the historical cost convention and in accordance with International Financial Reporting Standards as adopted by the European Union (IFRS).
The principal accounting policies are detailed in the Group's annual report and financial statements.
Going concern
The Directors have prepared cashflow forecasts for the period ending 31 January 2010. The forecasts, which take account of the post end year shares issues as detailed in note 6, assume that an acquisition of a business will not be completed and that minimal costs will be incurred whilst an acquisition is sought. If a potential acquisition is identified it will only be completed if sufficient funding is available to fund the costs of the acquisition and the on-going working capital requirements of the enlarged Group.
On this basis the financial statements have been prepared on a going concern basis. The financial statements do not include any adjustments that would result if the assumptions detailed above are not met.
2. Taxation
There is no tax charge for the year (2007: £nil).
Although the Group has unrelieved tax losses of approximately £2,332,495 (2007: £2,208,913) it is unlikely that they will be available to offset against future taxable trading profits due to the change in the nature of the business of the Group.
The tax assessed for the period differs from the standard rate of corporation tax in the UK as follows:
| 2008 | 2008 | 2007 | 2007 | ||
| £ | % | £ | % | ||
| Loss before taxation | ` | (194,800) | (878,247) | ||
| Loss multiplied by standard rate of corporation tax in the UK of 28% (2007: 30%) | (54,544) | (28) | (263,474) | (30) | |
| Effect of: | |||||
| Expenses not deductible for tax purposes | 19,941 | 10 | 214,218 | 24 | |
| Deferred tax asset not recognised | 34,603 | 18 | 49,256 | 6 | |
| Total tax charge for year | - | - | - | - |
3. Loss per share
The calculation of the basic loss per share is based on the loss after taxation of £194,800 (2007: £878,247) divided by the weighted average number of ordinary shares in issue during the year of 207,609,453 (2007: 188,986,494). The impact of the convertible loan on the loss per share at 31 July 2007 was anti-dilutive.
Subsequent to the year-end, 204,700,000 ordinary shares have been issued (see note 6). If these shares had been in issue throughout the year ended 31 July 2008 the basic and diluted loss per share would have been 0.05p.
4. Share capital
| 2008 | 2007 | |
| £ | £ | |
| Authorised | ||
| 4,000,000,000 ordinary shares of 0.25p each | 10,000,000 | 10,000,000 |
| Allotted, issued and fully paid | ||
| 297,794,385 (193,294,395) ordinary shares of 0.25p | 744,486 | 483,236 |
The movement in share capital is analysed as follows:
| Ordinary shares | ||||
| No. | £ | |||
| Allotted, issued and fully paid | ||||
| At 1 August 2006 | 188,699,301 | 471,673 | ||
| Issue of shares | 4,625,084 | 11,563 | ||
| As at 31 July 2007 | 193,294,385 | 483,236 | ||
| Issue of shares | 104,500,000 | 261,250 | ||
| At 31 July 2008 | 297,794,385 | 744,486 | ||
On 11 June 2008 a total of 104,500,000 new ordinary shares were issued. Of this number, 79,500,000 were issued at par to Corvus Capital Inc. following the conversion of its convertible loan balance of £192,875 in accordance with the terms of a convertible loan facility agreement entered into in October 2006 and extended in November 2007, together with the settlement at par of an other loan of £5,875. The remaining 25,000,000 newly issued ordinary shares were issued at £0.01 per share. The premium on issue of £187,500 has been recognised within the share premium account, net of share issue costs of £18,712.
5. Related party transactions
During the year Corvus Capital Inc. ("Corvus") converted loans of £198,750 into newly issued ordinary shares in the Company. Since the year-end, Corvus has transferred these shares to Corvus Capital Limited, a Cayman Islands company which owns 16.6% of the issued share capital of the Company as at the date of these financial statements.
During the year Corvus and its subsidiaries charged the Group fees of £119,851 (2007: £17,003) in respect of management, accounting and administrative services provided. The total amount due to Corvus, including its subsidiaries, at 31 July 2008 was £96,045 (2007: £125,853). The total amount has been paid since the year end.
6. Events after the balance sheet date
On 19 August 2008 157,700,000 ordinary shares were issued at par of which the cash element raised was £45,000.
On 19 December 2008 the Company placed 35,000,000 new ordinary shares at £0.02 per share with new and existing institutional shareholders for net proceeds of £650,000 and issued 12,000,000 new ordinary shares at par to Sirius Oil & Gas Limited (BVI) under an Agreement dated 23 July 2008. These shares were issued on 9 January 2009.
Of the shares issued in August and December 2008 a total of 8,750,000 were placed with Graham Porter and 5,250,000 with Mike Hirschfield, who are both Directors of the Company.
7. Publication of non-statutory accounts
The financial information set out in this preliminary announcement does not constitute statutory accounts as defined in section 240 of the Companies Act 1985.
The consolidated balance sheet at 31 July 2008 and consolidated income statement, consolidated statement of changes in equity, consolidated cash flow statement and associated notes for the year then ended have been extracted from the Group's 2008 financial statements upon which the auditors opinion is unqualified.