TIDMARL
RNS Number : 6849N
Atlantis Resources Limited
20 May 2015
20 May 2015
ATLANTIS RESOURCES LIMITED
("Atlantis", the "Company" or the "Group")
Final Results
London - Atlantis Resources Limited, a vertically integrated
turbine supplier and project owner in the tidal power industry, is
pleased to announce its final results for the year ended 31
December 2014.
The full Annual Report and Group financial statements can be
read and downloaded from the Company's website:
http://www.atlantisresourcesltd.com/company-documents/annual-reports.html
Highlights - year to 31 December 2014
-- February 2014 - Atlantis raised approximately GBP12 million
before expenses and became the first tidal developer to be admitted
to AIM. In the same month, Atlantis announced that it had been
awarded EUR7.7 million of European Commission grant funding
-- August 2014 - Atlantis is awarded a GBP7.5 million two year
contract with the UK's Energy Technologies Institute (the "ETI") to
design and deliver a multi-turbine foundation structure for
installation at MeyGen
-- September 2014 - financial close was announced for GBP51.3
million of funding for the first 6 MW phase of Atlantis's MeyGen
project
-- October 2014 - Atlantis raised a further GBP5.0 million
before expenses from new and existing shareholders in support of
its commitment to equity investment in MeyGen
Highlights - post year end
-- January 2015 - construction works commenced at the MeyGen
site in northern Scotland to establish the onshore power conversion
centre and drill cable routes for power export; the project is on
track to deliver first power in 2016
-- March 2015 - Atlantis entered into a multi-million pound
turbine construction contract with Lockheed Martin for delivery of
the first AR1500 turbine to MeyGen in 2016
-- April 2015 - Atlantis announced the execution of a sale and
purchase agreement with Siemens AG for the acquisition of Marine
Current Turbines Limited ("MCT"). On completion of the acquisition,
the Atlantis UK project portfolio will be boosted by 50% and the
turbine product offering will be expanded to include the SeaGen
system. A 1.2 MW SeaGen demonstration unit has been in operation at
Strangford Lough in Northern Ireland since 2008 and is included in
the acquisition
Tim Cornelius, Chief Executive of Atlantis Resources Limited
commented:
"2014 was a seminal year for Atlantis and we have again reached
new milestones for the Group and the wider tidal sector. Having
become the first tidal developer to successfully float on AIM, we
then secured another industry first when we achieved financial
close on a funding package of more than GBP51 million for the first
phase of our flagship MeyGen project in Scotland, the world's
largest tidal stream power development. Construction is now
underway at MeyGen, and it's exciting to see the onshore works
begin to take shape. We're on track to deliver our 1.5 MW turbine
to the project for installation in 2016, and we've contracted
industry leader Lockheed Martin as our major delivery partner for
this first-in-class machine.
"The start of 2015 has been just as notable, culminating in our
announcement of the execution of a sale and purchase agreement for
the acquisition of MCT from Siemens AG in April. This will bring a
host of benefits to both our turbines and projects businesses, and
is positive news for consolidation in an industry which continues
to mature and grow."
For further information please contact:
Atlantis Resources Limited via FTI Consulting
Tim Cornelius, Chief Executive
Officer
Duncan Black, Chief Financial
Officer
Peel Hunt LLP (Nominated Adviser
and Broker) +44 (0) 20 7418 8900
Daniel Harris
Jock Maxwell Macdonald
Euan Brown
FTI Consulting +44 (0) 20 3727 1000
Ben Brewerton
Alex Beagley
Stephanie Blott
James Styles
CHAIRMAN'S STATEMENT
2014 and the start of 2015 have undoubtedly borne witness to the
most exciting period yet in the history of our company. Commencing
in February 2014 with our public listing, and culminating in the
execution of an agreement to acquire another major tidal player
from Siemens AG this year, the team has worked tirelessly to
realise the potential of this clean, green energy sector.
Not least of our achievements has been the commencement of
construction for the first phase of the MeyGen project - truly a
world first. In September 2014 we announced financial close on a
GBP51 million funding package for construction and installation of
the first 6 MW of the MeyGen development. The total potential of
this site is almost 400 MW - powering the equivalent of more than
three quarters of the homes in Edinburgh. In January 2015, the
onshore works commenced to construct the building which will house
the power conditioning equipment and control centre, and to drill
the bores through which the power export cables will bring the
energy to shore. Offshore cable laying is scheduled to start in the
summer, and we're on track to be producing electricity from the
tides in 2016. Atlantis, having originated the project and fostered
its development from the start, remains an 85% shareholder in the
project company, alongside fellow investor, Scottish Enterprise
(through its Renewable Energy Investment Fund). The funding package
also included contributions from The Crown Estate, the Department
of Energy & Climate Change, and Highlands and Islands
Enterprise.
The turbines side of the business has continued to progress
well, entering into a supply agreement to deliver a 1.5 MW AR1500
machine to MeyGen in 2016. We have been working with Lockheed
Martin Corporation to complete the detailed design and carry out
component testing, and in March 2015 we signed up Lockheed Martin
as our major delivery partner for the turbine. This relationship
continues to go from strength to strength, with Lockheed Martin
also committed to delivering the yaw drive and variable pitch
system for this first MeyGen turbine under our long term teaming
agreement.
The turbines business has been further bolstered by our recent
announcement of the execution of a sale and purchase agreement for
the acquisition of MCT, which boasts an unrivalled operating
pedigree through its 1.2 MW installation at Strangford Lough in
Northern Ireland, and which will diversify our product line with
leaner, lighter machines for lower intensity sites and floating
applications. Siemens AG, the current owner of MCT, will not only
become a significant shareholder in Atlantis as a result of this
transaction, but will also commit to a continuing technology and
equipment supply relationship for our mutual benefit.
The projects side of the business will also benefit from the MCT
acquisition, which will boost the UK development pipeline by 50% to
600 MW of seabed leases and agreements for lease, extending our
interests into England, Northern Ireland and Wales as well as
building on our strong Scottish presence. I look forward to
updating you with news of these opportunities as we move into what
promises to be another busy year for Atlantis.
Finally, I would like to thank the Atlantis staff and my fellow
directors for all of their hard work in delivering our objectives,
and to thank our shareholders whose continuing support we very much
appreciate.
ANNUAL GENERAL MEETING
Our Annual General Meeting will be held on 24 June 2015 and the
notice of meeting will accompany our annual report. I look forward
to the opportunity to meet our shareholders and to discuss our
performance and the opportunities which lie ahead.
John Neill
Chairman
19 May 2015
CHIEF EXECUTIVE OFFICER'S STATEMENT
PROFILE
Atlantis Resources Limited, a global leader in the tidal power
sector, is focused on two core business areas - the development of
projects and the supply of turbines and associated equipment, both
to third parties and to our own projects. We're domiciled in
Singapore, from where we manage our activities in Asia, but our
principal project and operations office is in Edinburgh, supported
by a design satellite office in Bristol and a corporate office in
London. There's been a lot of emphasis this year on the UK, and
Scotland in particular, as we achieved financial close of GBP51
million of funding for the first phase of our MeyGen project, but
we continue to work with our project partners to pursue project
development and turbine sales opportunities in North America and
Asia, and to identify sites and customers of interest around the
world. The two sides of the business, projects and turbines, are
described below.
PROJECTS
Although we have been deriving energy from the tides for
centuries, in its modern form the tidal industry is a relatively
immature sector. From the very start, therefore, we have recognised
that it is not enough for us to create a successful technology
solution - we also need to identify and develop the sites to host
that technology. This kick-starts a market for our turbines while
also, crucially, building ourselves a founding stake in projects
which are forecast to yield attractive returns. With our agility
and sector specific knowledge we have shown that we can take a
greenfield site through the consenting, design and procurement
process, secure project finance and attract new equity
participants. Construction has now started on the MeyGen project,
and it is our objective to replicate this success across our
portfolio.
TURBINES
The AR1500 design team continues to work closely with the MeyGen
project team to ensure delivery of a turbine which can perform in
the challenging and high energy environment of the Pentland Firth,
and we've engaged Lockheed Martin as our quality and systems
integration provider to ensure that the rigour and consistency born
of a century in aerospace and defence flows through from the
detailed design and into our manufacturing and assembly processes.
The MeyGen site is one of the most energetic tidal environments in
the world, and the AR1500 is, consequently, a turbine which is
built to not only survive extreme flows, but to exploit them. This
makes it the ideal choice for other top tier sites such as those
elsewhere in the Pentland Firth and in the vast flows of Canada's
Bay of Fundy, but the acquisition of MCT will add a new string to
our bow, expanding the Atlantis product line with a smaller,
lighter and less powerful turbine which may be the best economic
choice for smaller scale or lower energy sites. MCT's SeaGen
turbine is also better suited than the AR1500 to floating
applications, which show promise for the future - particularly for
deeper water sites. SeaGen's greatest attribute, however, is the
operating record established by the two 0.6 MW demonstration units
installed in Strangford Lough in Northern Ireland in 2008. This
deployment was a world first, and has produced, besides more than 9
GWh of electricity, an unsurpassed database of environmental
monitoring, operations and maintenance information. Atlantis
intends to continue to operate this iconic asset, as well as
pursuing opportunities for expansion of the site into a commercial
array (for which a 20 MW agreement for lease has already been
granted).
In pursuit of our ancillary technology products, Atlantis has
been undertaking testing and development of its proprietary
installation tools, designed to facilitate deployment and
connection of turbines as safely and efficiently as possible,
without the need for divers or submersible vehicles. We also
continue with the industry leading programme of work contracted to
us by the ETI to develop the StreamTec foundation system for
deployment at the MeyGen site.
SUMMARY OF RESULTS
Revenue in the year to 31 December 2014 was derived from the
provision of consulting services, predominantly in relation to the
ETI project for cost reduction in tidal energy which Atlantis has
been contracted to deliver. The Group's total revenue for the
financial year ending 31 December 2014 was approximately S$5.3
million, reduced from S$6.2 million for the previous year as a
result of there having been no equipment sales in this period.
Total expenses for the year ending 31 December 2014 were S$19.8
million, a rise of S$0.6 million from the previous year. This
increase is attributable to a doubling in the average number of
employees from 17 for the year ending 31 December 2013 to 35 in the
year ending 31 December 2014. This workforce expansion was, in
large part, in support of the construction of the MeyGen project;
however, these costs are capitalised and funded as part of the
MeyGen project funding. The remaining additional employees, the
costs of whom are expensed, are primarily engaged in the delivery
of the AR1500 turbine to the MeyGen project under the Atlantis
turbine supply agreement.
The loss for the year ending 31 December 2014 was S$16.2
million, an increase of S$6.5 million on the previous year. The
primary reason for the increased loss was the impact in the year
ending 31 December 2013 of the "other gains" resulting from the
negative goodwill arising from the acquisition of MeyGen, which was
in part offset by additional financing costs relating to the
conversion of shareholder loans. The other factors contributing to
the enlarged loss are the S$0.9 million reduction in revenue and
the S$0.6 million increase in expenses as described above.
The Group's net assets were boosted to S$98.0 million at 31
December 2014 from S$21.6 million 12 months earlier. This was a
result of the capitalised expenditure on construction of Phase 1A
of the MeyGen project, as well as increased cash, also primarily
relating to funding for the MeyGen project. Total liabilities fell
from S$66.7 million at 31 December 2013 to S$48.6 million at 31
December 2014, chiefly as a result of the Company's conversion and
repayment of shareholder loans. This was, however, partially offset
by an increase in borrowings relating, in the main, to the
financing of MeyGen Phase 1A. Total equity attributable to the
owners of the Company rose to S$89.4 million at 31 December 2014
from S$21.6 million at 31 December 2013.
The net cash used in operating and investing activities was
S$35.8 million, an increase of S$27.2 million from the previous
period. Net cash from financing activities for the year was S$58.0
million, of which S$35.6 million was the proceeds from the issue of
shares and S$7.3 million was from borrowings. Total cash and cash
equivalents at 31 December 2014 were S$23.1 million, compared with
S$0.9 million at 31 December 2013.
Timothy Cornelius
Chief Executive Officer
19 May 2015
FINANCIALS
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
Year ended December 31, 2014
2014 2013
----------------- ------------------
S$'000 S$'000
Revenue 5,279 6,190
Other gains 1,129 18,690
Employee benefits expenses (7,016) (4,667)
Other operating expenses (5,375) (5,867)
Subcontractor costs (3,363) (4,489)
Depreciation and amortisation (3,185) (3,201)
Research and development
costs (840) (961)
----------------- ------------------
Total expenses (19,779) (19,185)
----------------- ------------------
Results from operating
activities (13,371) 5,695
Finance costs (2,835) (15,360)
Loss before tax (16,206) (9,665)
Tax credit/(expense) 11 (11)
Loss for the year (16,195) (9,676)
Other comprehensive income:
Items that may be reclassified
subsequently to profit
or loss
Exchange differences
on translation of foreign
operations 996 (1,975)
----------------- ------------------
Other comprehensive income
for the year, net of
tax 996 (1,975)
Total comprehensive income
for the year (15,199) (11,651)
================= ==================
Losses attributable to:
Owners of the Group (16,195) (9,676)
Total comprehensive income
attributable to:
Owners of the Group (15,199) (11,651)
Loss per share
Basic and diluted loss
per share (S$) (0.22) (0.26)
================= ==================
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
December 31, 2014
2014 2013
S$ '000 S$ '000
ASSETS
Non-current assets
Available-for-sale investments - -
Property, plant and equipment 70,508 3,007
Intangible assets 43,194 44,040
--------- ------------------
113,702 47,047
--------- ------------------
Current assets
Cash and cash equivalents 29,247 2,620
Trade and other receivables 3,719 1,601
Other assets - 37,052
32,966 41,273
Total assets 146,668 88,320
========= ==================
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables 18,562 6,805
Provisions 795 1,104
Current tax payable - 11
Loans and borrowings - 38,762
--------- ------------------
19,357 46,682
Non-current liabilities
Deferred tax 7,905 7,602
Loans and borrowings 21,375 12,414
--------- ------------------
29,280 20,016
Total liabilities 48,637 66,698
Net assets 98,031 21,622
========= ==================
2014 2013
S$ '000 S$ \'000
EQUITY
Share capital 185,500 114,906
Capital reserve 11,448 -
Translation reserve 280 (716)
Option fee 10 10
Share option reserve 4,932 3,994
Accumulated losses (112,767) (96,572)
Total equity attributable
to owners of the Company 89,403 21,622
Non-controlling interests 8,628 -
---------- -----------------
Total equity 98,031 21,622
========== =================
STATEMENTS OF CHANGES IN EQUITY
Year ended December 31, 2013
Attributable
Share to equity
Share Translation Option option Accumulated holder
of the
capital reserve fee reserve losses Group
S$'000 S$'000 S$'000 S$'000 S$'000 S$'000
Group
Balance at
January 1,
2013 111,282 1,259 10 3,435 (86,896) 29,090
Total
comprehensive
income for
the year
Loss for the
year - - - - (9,676) (9,676)
Other
comprehensive
income for
the year - (1,975) - - - (1,975)
------------------------- ------------------------------------ ------------------------ -------- ------------ -------------
Total - (1,975) - - (9,676) (11,651)
------------------------- ------------------------------------ ------------------------ -------- ------------ -------------
Transactions
with owners,
recognised
directly in
equity
Contributions
by and
distributions
to owners
Issue of share
capital 3,621 - - - - 3,621
Exercise of
share options 3 - - - - 3
Recognition
of share
based
payments - - - 559 - 559
------------------------- ------------------------------------ ------------------------ -------- ------------ -------------
Total 3,624 - - 559 - 4,183
------------------------- ------------------------------------ ------------------------ -------- ------------ -------------
Balance at
December 31,
2013 114,906 (716) 10 3,994 (96,572) 21,622
========================= ==================================== ======================== ======== ============ =============
STATEMENTS OF CHANGES IN EQUITY (cont'd)
Year ended December 31, 2014
Share
Share Capital Translation Option option Accumulated Non-controlling
capital reserve reserve fee reserve losses Total interest Total
------------------------ --------- ------------ ------------------------ ---------- ---------------------------------- ------------------- ------------------ -------------------
S$'000 S$'000 S$'000 S$'000 S$'000 S$'000 S$'000 S$'000 S$'000
Balance at
January
1, 2014 114,906 - (716) 10 3,994 (96,572) 21,622 - 21,622
Total
comprehensive
loss for the
year
Loss for the
year - - - - - (16,195) (16,195) - (16,195)
Other
comprehensive
income for
the
year - - 996 - - - 996 - 996
------------------------ --------- ------------ ------------------------ ---------- ---------------------------------- ------------------- ------------------ -------------------
Total - - 996 - - (16,195) (15,199) - (15,199)
------------------------ --------- ------------ ------------------------ ---------- ---------------------------------- ------------------- ------------------ -------------------
Transactions
with
owners,
recognised
directly in
equity
Contributions
by and
distributions
to owners
Issue of
ordinary
shares 32,758 - - - - - 32,758 - 32,758
Conversion of
convertible
loans
into shares
during
public
offering 37,836 - - - - - 37,836 - 37,836
Recognition of
share based
payments - - - - 938 - 938 - 938
Dilution of
interest
in a
subsidiary
without
change
in control - 11,448 - - - - 11,448 8,628 20,076
------------------------ --------- ------------ ------------------------ ---------- ---------------------------------- ------------------- ------------------ -------------------
Total 70,594 11,448 - - 938 - 82,980 8,628 91,608
------------------------ --------- ------------ ------------------------ ---------- ---------------------------------- ------------------- ------------------ -------------------
Balance at
December
31, 2014 185,500 11,448 280 10 4,932 (112,767) 89,403 8,628 98,031
======================== ========= ============ ======================== ========== ================================== =================== ================== ===================
CONSOLIDATED STATEMENT OF CASH FLOWS
Year ended December 31, 2014
2014 2013 (restated)
S$ '000 S$ '000
Operating activities
Loss before tax (16,206) (9,665)
Adjustments for:
Release of negative goodwill
to income - (16,674)
Fair value of pre-existing
interest in acquiree - (1,938)
FVTPL - 3,189
Depreciation of property, plant
and equipment 37 162
Amortisation of intangible
asset 3,148 3,039
Interest expense 2,835 12,171
Bad debt expense - 50
Share-based payments 938 559
Provisions made during the
year (309) 1,104
Net foreign exchange 727 (1,348)
Grant income (668) -
--------- ----------------
Operating cash flows before
movements in working capital (9,498) (9,351)
Trade and other receivables (2,411) (852)
Inventory - 1,636
Trade and other payables 7,574 2,759
--------- ----------------
Cash used in operations (4,335) (5,808)
Investing activities
Purchase of property, plant
and equipment (27,361) (464)
Expenditure on project development (4,080) (1,908)
Acquisition of subsidiary,
net of cash acquired - (418)
Net cash used in investing activities (31,441) (2,790)
--------- ----------------
Financing activities
Proceeds from grants received 4990 -
Proceeds from issue of shares 35,558 3,621
Share issuance cost (2,800) -
Proceeds from exercising of
share options - 3
Proceeds from borrowings 7,293 5,165
Repayment of borrowings (2,400) -
Deposits pledged (4,446) (1,712)
Interest paid (262) -
Non-controlling interest 20,076 -
-------- --------
Net cash from financing activities 58,009 7,077
-------- --------
Net increase (decrease) in cash
and bank balances 22,233 (1,521)
Cash and cash equivalents at
the beginning of the year 908 2,338
Effect of foreign exchange rate
changes on the
balance of cash held in foreign
currencies (52) 91
-------- --------
Cash and cash equivalents at
the end of the year 23,089 908
======== ========
Further detail may be read and downloaded from the company
website:
http://www.atlantisresourcesltd.com/company-documents.html
Annual General Meeting
Atlantis also announces that a Notice will be sent to
shareholders today to convene the Annual General Meeting ("AGM") of
the company.
The AGM will be held at the offices of Ashurst LLP, Broadwalk
House, 5 Appold Street, London EC2A 2HA at 10:00 a.m. (London time)
on Wednesday, 24 June 2015. The AGM Notice is also available on the
company's website:
http://www.atlantisresourcesltd.com/company-documents/notices.html.
This information is provided by RNS
The company news service from the London Stock Exchange
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