WRES.L Regulatory News (WRES)

29 Sep 2005 07:02

Caspian Holdings plc29 September 2005 29 September 2005 CASPIAN HOLDINGS Plc ("Caspian" or "the Company") ANNOUNCES INTERIM RESULTS FOR THE SIX MONTHS TO 30TH JUNE 2005 Caspian Holdings Plc (AIM:CSH) has had an active program since our inauguralAnnual Report and significant field work and evaluation has now created a solidbase from which the Company can deliver substantial increases in oil productionfrom our flagship Zhengeldy oil field. The profitability of the increasedproduction should be further enhanced by an expected increase in the wellheadprice resulting from the commencement of exports from the Zhengeldy field. Highlights for the period include: •Drilling of 7 new wells and reactivating 2 old wells •Production in excess of 25,000 barrels of oil •Schlumberger Zhengeldy gasfield and reservoir review •Logging and commencement of workover of five wells •Identification of further scope to increase production rates through new drilling program Since January 2005, Caspian has drilled six new wells and reactivated two olderwells drilled by the Soviet Union in the 1930s. In total nine new wells andthree old wells have been drilled by Caspian since the commencement of fielddevelopment operations in mid 2004 with commercial oil production successfullyachieved from seven of the new wells and two of the reactivated wells. Thisbrings total field production to August in excess of 25,000 barrels of oil. Oil production performance from the field has been mixed with some wellsdelivering healthy oil production rates, some being dry and two having lowerthan expected production rates. The mixed results prompted Caspian to commence an extensive reservoir andreserve evaluation program with Schlumberger Central Asia. This has involvedfull petrophsycial evaluation of both old and new wells, new logging and theconstruction of a revised geological model. The results of the review have ledto a significantly clearer geological model and identification of a total ofeight potential individual reservoirs and a program to bring into production thepreviously dry and poorly performing wells. In addition the review hasidentified a large increase in net pay in some of the producing wells, andtherefore significantly increasing the production capabilities of thoseproducing wells. The final evaluation report from Schlumberger Central Asia is expected to beavailable by the end of October. The significant increase in the production rates should be achieved as a resultof: • Identification of new oil bearing levels • Identification of larger net oil pay zones • Superior control over perforations. • Better quality cementation • Removal of water incursions • Water disposal well The workover program, which has commenced, has the objective of bringing all newwells into commercial production during 2005. An extensive five well loggingprogram was completed by Schlumberger in Q3 2005 and the workovers of thesewells is underway. The remainder of the wells will commence workover during thelatter part of Q4 2005. Based on the success of this program, the Company is excited by the potential tosignificantly increase oil production rates through a new drilling campaign. The interim financial results reflect the early stage of development and oilproduction of the company. For the six months to 30 June 2005 turnover was£159,494 and the loss after taxation was (£522,633). The progress that the Company has made in grappling with the initial technicalchallenges of the Zhengeldy field and developing a program to rapidly increaseoil production could not be achieved without the commitment of the managementteam under the leadership of Chief Operating Officer Dietmar Greil. For further information, please contact: Caspian Holdings Plc Hoodless Brennan Parkgreen CommunicationsMichael Masterman Edward Hutton Justine Howarth / Ana RibeiroT: +447791288381 T: +44 (0) 20 7538 1166 T: +44 (0)20 7493 3713 CASPIAN HOLDINGS PlcGROUP PROFIT AND LOSS ACCOUNTFOR THE SIX MONTHS ENDED 30 JUNE 2005 Notes Unaudited 2005 Year to 31st December 2004* TURNOVER 2 159,494 - Cost of sales 182,590 17,057 -------- -------- GROSS LOSS (23,096) (17,057) Administrativeexpenses 552,684 617,112 -------- -------- OPERATING LOSS Acquisitions - (173,934)Continuingoperations (575,780) (460,235) -------- -------- (575,780) (634,169) Interestreceivable andsimilar income 55,632 13,254 Interest payableand similarcharges (2,485) (6,525) -------- -------- LOSS ON ORDINARYACTIVITES BEFORETAXATION (522,633) (627,440) Tax onloss/profit onOrdinaryactivities 3 - - -------- -------- LOSS FOR THEFINANCIAL YEARAFTER TAXATION (522,633) (627,440) Minority equityinterests - 29,948 -------- -------- RETAINED LOSSFOR THEFINANCIAL YEAR £(522,633) £(597,492) ======== ======== Basic andDiluted loss pershare 4 0.62P 2.33P * Results are restated for the impact of the transition to InternationalFinancial Reporting Standards (IFRS) see note 5. CASPIAN HOLDINGS Plc GROUP BALANCE SHEETAS AT 30 JUNE 2005 Notes Unaudited 31st December 2005 2004*FIXED ASSETSIntangible assets 1,798,265 1,766,962Tangible assets 1,516,002 784,006 -------- -------- 3,314,267 2,550,968 CURRENT ASSETSStocks 6,389 72,469Debtors 586,483 302,503Cash at bank and in 1,695,466 3,100,585hand -------- -------- 2,288,338 3,475,557 CREDITORS: Amountsfalling due 263,931 318,606within one year -------- -------- NET CURRENT ASSETS 2,024,407 3,156,951 -------- -------- TOTAL ASSETS LESSCURRENT 5,338,674 5,707,919LIABILITIES CREDITORS: Amountsfalling due after 124,850 128,839more than one year PROVISIONS FORLIABILITIES AND 21,174 4,097CHARGES -------- -------- £5,192,650 £5,574,983 ======== ======== CAPITAL ANDRESERVESCalled up share 6 84,492 83,882capitalShare premium 6 6,227,445 6,087,755accountProfit and loss 6 (1,119,287) (596,654)account -------- -------- Shareholders' funds £5,192,650 £5,574,983 ======== ======== Shareholders' fundsattributable to £5,192,650 £5,574,983Equity interest ======== ======== * Results are restated for the impact of the transition to InternationalFinancial Reporting Standards (IFRS) see note 5. CASPIAN HOLDINGS PlcGROUP CASH FLOW STATEMENTFOR THE SIX MONTHS ENDED 30 JUNE 2005 Notes Unaudited 2005 Year to 31st December 2004 * Net cash outflow fromoperating activities 1 (783,887) (1,054,611) Returns on investmentsand servicing offinance 2 53,147 6,729 Capital expenditureand financialinvestment 2 (817,881) (1,041,622) Acquisitions anddisposals 2 - (861,428) -------- -------- (1,548,621) (2,950,932) Financing 2 137,101 6,149,266 -------- -------- (Decrease)/Increase incash in the period £(1,411,520) £3,198,334 ======== ======== Reconciliation of net cash flow 3to movement in net debt (Decrease)/Increase in cash in the period (1,411,520) 3,198,334 Cash inflow/(outflow) from decrease in debt andLease financing 3,199 (119,929) -------- -------- Change in net debt resulting from cash flows (1,408,321) 3,078,425 Royalty payments acquired - (160,089) -------- -------- Movement in net debt in the period (1,408,321) 2,918,316 Net cash at 1 January 2005 2,918,316 - -------- -------- Net cash at 30 June 2005 £1,509,995 £2,918,316 ======== ======== * Results are restated for the impact of the transition to InternationalFinancial Reporting Standards (IFRS) see note 5. CASPIAN HOLDINGS Plc NOTES TO THE GROUP CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2005 1. RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATINGACTIVITIES Unaudited 2005 Year to 31st ------------- December 2004 * Operating Loss (575,780) (634,169)Depreciation charges 54,582 36,902Decrease/(Increase) in stocks 66,080 (72,339)(Increase) in debtors (283,980) (235,899)(Decrease) in creditors (61,866) (151,901) ---------- -----------Increase in provisions 17,077 2,795 -------- ---------Net cash outflow fromoperating activities £(783,887) £(1,054,611) ======== ========= 2. ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN THE CASH FLOW STATEMENT Return on investments and servicing of financeInterest received 55,632 13,254Interest paid (2,485) (6,525) -------- ---------Net cash outflow for returns onInvestments and servicing of finance £53,147 £6,729 ======== ========= Capital expenditure and financial investmentPurchase of intangible fixed assets (38,853) (241,014)Purchase of tangible fixed assets (905,969) (795,132)Disposal of tangible fixed assets 117,308 -Exchange differences 9,633 (5,476) -------- ---------Net cash outflow for capital expenditureand financial investment £(817,881) £(1,041,622) ======== ========= Acquisitions and disposalsPurchase of subsidiaries - (864,546)Cash acquired - 3,118 --- ------- Net cash outflow for acquisitions anddisposals £- £861,428 ======== ========= FinancingShare issue 140,300 6,029,337Capital element of hire purchase offinance leases (276) 22,488Capital element of royalty payments (2,923) 97,441 -------- --------- Net cash (outflow)/inflow from financing £137,101 £6,149,266 ======== ========= * Results are restated for the impact of the transition to InternationalFinancial Reporting Standards (IFRS) see note 5. CASPIAN HOLDINGS PlcNOTES TO THE GROUP CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2005 3. ANALYSIS OF CHANGES IN NET DEBT At 01.01.05 Cashflow At 30.06.05 Net cash:Cash at bank and in hand 3,100,585 (1,405,119) 1,695,466 -------- -------- -------- Debt:Hire purchase or finance leases (22,488) (276) (22,764)Royalty lease payments (159,781) (2,923) (162,707) -------- -------- -------- (182,269) (3,199) (185,471) -------- -------- -------- Total £2,918,316 £(1,408,318) £1,509,995 ======== ======== ======== Analysed in Balance Sheet Cash at bank and in hand 1,695,466Hire purchase or finance leaseswithin one year (12,519)after one year (10,245)Royalty lease paymentsWithin one year (48,102)after one year (114,605) -------- £1,509,995 ======== CASPIAN HOLDINGS PlcNOTES TO THE INTERIM RESULTSFOR THE SIX MONTHS ENDED 30 JUNE 2005 1. BASIS OF PREPARATION As a European Union Listed company Caspian Holdings Plc has been required toadopt International Financial Reporting Standards (IFRS) with effect from 1January 2005. The results for the six months ended 30 June 2005 represent thegroup's first interim results prepared in accordance with it's accountingpolicies under IFRS. The group's first IFRS annual report and accounts will befor the year ended 31 December 2005. The detailed reconciliation of shareholdersfunds as at 31 December 2004 to those previously declared is shown in note 5. These financial statements have been prepared by the group using those standardsit expects to be endorsed and applicable when the IFRS accounts are prepared forthe year ending 31 December 2005. The interim results are unaudited but have been reviewed by the auditors. Thefinancial statements herein do not amount to full statutory accounts within themeaning of Section 240 of the Companies Act 1985 (as amended). 2. TURNOVER Turnover represents sale of oil. 3. TAXATION There is no taxation arising on the loss on ordinary activities for the sixmonths ended 30 June 2005. 4. LOSS PER ORDINARY SHARE The calculation of the loss per ordinary share is based on a Group loss of£522,633 for the 6 months ending 30th June 2005 (£627,440 for the year ended31st December 2004 as amended per note 5), and the weighted average ordinaryshares outstanding of 84,187,000 (26,929,102 for the year ended 31st December2004). On the basis of the above calculations, the loss per ordinary share for the 6months to 30th June 2005 is 0.62p (31st December 2004 2.33p). CASPIAN HOLDINGS PlcNOTES TO THE INTERIM RESULTSFOR THE SIX MONTHS ENDED 30 JUNE 2005 5. RECONCILIATION OF OPENING SHAREHOLDERS' FUNDS Group Share Capital Other Reserve Share Premium Profit and Loss Total Account Shareholders FundOpeningshareholders'funds aspreviouslydeclared 83,882 2,775 6,087,755 (573,020) 5,601,392 Adjustment forrevision ofhistoricalcost ofRoyaltiesshown asIntangibleAssets - - - (126,142) (126,142) Adjustment fordiscounting ofroyaltyliabilities - - - 105,559 105,559 Adjustment forchange inaccountingpolicy forstock - - - (17,643) (17,643) Adjustment forrestatement ofreserve asprovision - (2,775) - 215 (2,560) Adjustment forrevision ofhistoricalcost ofdeferred costs - - - 14,377 14,377 ------ ------- -------- -------- --------- Openingshareholders'funds restated £83,882 £- £6,087,755 £(596,654) £5,574,983 ====== ======= ======== ======== ========= 6. RESERVES AND RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS Group Share Capital Share Premium Profit and Loss Total Account Shareholders Fund Loss for thefinancial year - - (522,633) (522,633) Shares issued 610 139,690 - 140,300 ------- -------- -------- ---------Net additionstoshareholders'funds 610 139,690 (522,633) (382,333) Openingshareholders'funds (Note 6) 83,882 6,087,755 (596,654) 5,574,983 ------- -------- -------- ---------Closingshareholders'funds £84,492 £6,227,445 £(1,119,287) £5,192,650 ======= ======== ======== ========= CASPIAN HOLDINGS PlcIndependent review reportFOR the SIX MONTHS TO 30TH JUNE 2005 Introduction We have been instructed by the company to review the financial information forthe six months ended 30th June 2005. We have read the other informationcontained in the interim report and considered wither it contains any apparentmisstatements or material inconsistencies with the financial information. Our report has been prepared in accordance with the terms of our engagement toassist the company in meeting the requirements of the rules of the London StockExchange for companies trading securities on the Alternative Investment Marketand for no other purpose. No person is entitled to rely on this report unlesssuch a person is a person entitled to rely upon this report by virtue of and forthe purpose of our terms of engagement or has been expressly authorised to do soby our prior written consent. Save as above, we do not accept responsibility forthis report to any other person or for any other purpose and we hereby expresslydisclaim any and all such liability. Director's Responsibilities The interim report, including the financial information contained therein, isthe responsibility of, and has been approved by the directors. The directors areresponsible for preparing the interim report in accordance with the rules of theLondon Stock Exchange for companies trading securities on the AlternativeInvestment Market which require that the half-yearly report be presented andprepared in a form consistent with that which will be adopted in the company'sannual accounts having regard to the accounting standards applicable to suchannual accounts. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4issued by the Auditing Practices Board for use in the United Kingdom by auditorsof fully listed companies. A review consists principally of making enquiries ofmanagement and applying analytical procedures to the financial information andunderlying financial data and based thereon, assessing whether the accountingpolicies and presentation have been consistently applied unless otherwisedisclosed. A review excludes audit procedures such as tests of controls andverification of assets, liabilities and transactions. It is substantially lessin scope than an audit performed in accordance with United Kingdom AuditingStandards and therefore provides a lower level of assurance than an audit.Accordingly we do not express an audit opinion on the financial information. Review Conclusion On the of our review we are not aware of any material modifications that shouldbe made to the financial information as presented for the six months ended 30thJune 2005. COOK AND PARTNERSChartered Accountants This information is provided by RNS The company news service from the London Stock Exchange