TIDMCAO
RNS Number : 1608Q
Camco International Ltd
06 April 2009
?
Camco International - Preliminary Results
Camco International Ltd
6 April 2009
Camco International Limited
Preliminary results announcement
The Camco Group, a leading climate change and sustainable development business,
is pleased to announce its Preliminary results for the period ended 31 December
2008.
FINANCIAL HIGHLIGHTS as at 31 December 2008
* Maiden profit with PBT of EUR2.2 million (2007: loss of EUR12.2 million);
* Revenues of EUR41.5 million for Carbon, Advisory (formerly Consulting) and
Investment (formerly Ventures) business units (2007: EUR10.4 million); and
* Strong 31 December 2008 cash balance of EUR27.0 million positioning the Company
for 2009.
HIGHLIGHTS as at 31 December 2008
* Growth over the year in the carbon portfolio with 155.3m tonnes (Adjusted PDD)
and 100.1m tonnes (Risk Adjusted);
* 20.4m tonnes (Risk Adjusted) registered in 2008 with successful registrations
continuing in the period to 31 March 2009;
* Successful carbon credit transactions on 12 and 28 August 2008. The 28 August
transaction delivered an upfront, non recourse payment of EUR15.0 million;
* The Advisory business achieved milestone of completing over 1,000 carbon
emission assessments for clients;
* Expansion into the US market resulting in several carbon footprinting and
project development contracts. In December 2008 Camco signed an agreement to
develop projects with a leading US dairy firm;
* Sale of Dallas Clean Energy landfill gas recovery facility in Texas for total
cash consideration of US$19.1 million; and
* Acquisition of ClearWorld Energy Ventures and the remaining 49% minority
interest of ESD Sinosphere, representing key pieces of the Company's platform in
China.
HIGHLIGHTS to 31 March 2009
* Cash position of EUR23.1 million as at 31 March 2009;
* The Risk Adjusted portfolio increased to 100.9m tonnes at 31 March 2009
reflecting new additions to the portfolio;
* Registration under the CDM of 5.2m tonnes (Risk Adjusted) since 31 December 2008
with 65% of the CER portfolio now registered. One project, the Fuxin Coal Mine
Methane (CMM) and Coal Bed Methane (CBM) project, is anticipated to deliver 2.6m
tonnes (Adjusted PDD) in the first Kyoto compliance period, using a methodology
developed by Camco;
* Deliveries in the period to 31 March 2009 of 0.13m tonnes bringing total
issuances to 5.6m tonnes; and
* A number of significant consulting contract wins early in 2009 including a large
contract in China for the British government.
Jeff Kenna, Camco Chief Executive, said:
"Achieving a maiden profit against the current economic backdrop has been a
significant achievement for the Company. We have established a business that
will deliver recurring cash flows in the years ahead with a large number of
projects now through the UN registration process. While 2009 will be a
challenging year, our healthy cash position and global platform mean that Camco
is well placed to move beyond the current adverse impact on climate change
businesses"
Notes to editors:
Enquiries:
+----------------------------------------------+---------------------------+
| The Camco Group | +44 (0)20 7121 6100 |
+----------------------------------------------+---------------------------+
| Jeff Kenna, Chief Executive Officer | |
+----------------------------------------------+---------------------------+
| Scott McGregor, Chief Financial Officer | |
+----------------------------------------------+---------------------------+
| | |
+----------------------------------------------+---------------------------+
| KBC Peel Hunt Ltd (Nominated Adviser and | +44 (0)20 7418 8900 |
| Broker) | |
+----------------------------------------------+---------------------------+
| Jonathan Marren | |
+----------------------------------------------+---------------------------+
| David Anderson | |
+----------------------------------------------+---------------------------+
| | |
+----------------------------------------------+---------------------------+
| Kreab Gavin Anderson | +44 (0)20 7554 1400 |
+----------------------------------------------+---------------------------+
| Kate Hill | |
+----------------------------------------------+---------------------------+
| Michaela Wood | |
+----------------------------------------------+---------------------------+
| Alex Gowlland | |
+----------------------------------------------+---------------------------+
About Camco
Camco an international leader in identifying and implementing solutions that
help businesses address their climate change risks and opportunities. Camco has
a 20-year track record in advisory services and one of the largest and most
diversified portfolios of carbon credits, making it a premier climate change and
sustainable development company.
Camco brings together the distinct but complementary service areas of Carbon,
Advisory and Investments to help its clients manage all aspects of their carbon
risk. Camco's businesses collaborate between service groups and countries,
sharing technical and commercial expertise to find the best options for its
clients.
The Carbon business unit is a leading project developer with one of the world's
largest carbon credit portfolios. We partner with companies to identify, develop
and manage projects that reduce greenhouse gas emissions, and then arrange the
sale and delivery of carbon credits to international compliance buyers and into
the voluntary market.
The Carbon business unit has also created one of the largest carbon credit
portfolios by working closely with companies to identify and develop projects
that reduce greenhouse gas (GHG) emissions. The team has structured ground
breaking and innovative arrangements for the sale and delivery of carbon credits
to compliance and voluntary buyers.
The Advisory business unit combines strategic, commercial, financial and
technical expertise accrued over two decades to deliver low carbon energy and
sustainable development solutions. Our experience spans emission assessments,
carbon management strategies and project delivery, as well as international
energy and climate change policy.
Camco's Investment business unit collaborates with manufacturers, project
developers, technology providers and investor groups to turn innovative ideas
into commercially viable and applicable solutions that will make a difference in
tackling climate change.
Chairman's Report
I am pleased to report a first time profit for Camco in the year to 31 December
2008. Camco has attained profitability whilst continuing to invest in the growth
of its global climate change and sustainable development platform. We end 2008
with no significant debt and EUR27.0 million in cash.
We have integrated and rebranded as Camco our businesses including ESD in the
UK, Africa and Bulgaria, Bradshaw Consulting in the UK, and ESD Sinosphere and
ClearWorld Energy Ventures in China. In particular, the former ESD remains
central to the value of Camco's Carbon and Advisory businesses and continues to
produce opportunities for our business. We are now able to deliver an extensive
range of carbon reduction-related products and services for clients worldwide
who are seeking to manage their growing carbon assets and liabilities. By
uniting these distinct but complementary services under one banner, we will be
able to deliver an extensive range of carbon reduction-related products and
services, devising customised solutions for clients worldwide who are seeking to
manage their growing carbon liabilities.
Advances in the macro policy environment continue to look promising for the
growth of the business. The election of Barak Obama is likely to herald the
emergence of the United States (US) as a lead participant in post-2012
negotiations to reduce greenhouse gas (GHG) emissions. Recent announcements by
the US administration indicate that a planned cap and trade scheme would
generate approximately US$650 billion in government income between 2012 and 2019
indicating the magnitude of the opportunity in the US market. Europe has
reaffirmed its commitment to tackling climate change and the 2008 United Nations
Climate Change conference in Poznan produced some significant decisions. The UK
now requires large non-energy intensive organisations to manage their carbon
emissions through the Carbon Reduction Commitment.
Through these policy discussions it has become clear that the next key objective
remains evolving the relationship between the developed and developing world
over reduction targets and technology transfer. This will be an enormous part of
the international post-2012 solution. Camco's presence in both developing and
developed countries, along with its internal policy and strategy unit that
tracks and contributes to climate change policies worldwide, places it at the
centre of these initiatives with the capability to facilitate and profit from
the results.
The carbon markets are highly exposed to the downturn impacting the global
economy. Prices for CERs have fallen from a high of EUR23 in the summer of 2008 to
recent lows of below EUR10. We expect prices for CERs to remain volatile during a
recessionary environment.
Despite the recent volatility, Camco believes that the EUR15 carbon price
estimated at the time of AIM admission remains a realistic expectation as an
average for the period to 2012. We remain firm in our belief that the role of
cap and trade systems will continue to expand globally and that regulators will
produce systems that result in an increase in the carbon price in the medium
term. However, we must remain cautious with our costs and disciplined with our
investment initiatives to ensure the value we have created is delivered to
shareholders.
Our global platform, high quality staff and strong cash position have placed the
business in a good position for 2009. We will continue to push our projects
through the Clean Development Mechanism (CDM) registration process and work with
partners in our key markets to identify new projects. Our investment activities,
bolstered by the acquisition of Clearworld Energy Ventures in China, remain a
strategic focus albeit in a challenging economic environment.
We are extremely proud to have achieved our promised maiden profit in 2008 and I
would like to congratulate all of our stakeholders who contributed to this
result.
David Potter
Chairman
March 2009
Financial Review
The Company is pleased to have achieved a profit before tax of EUR2.2 million and
a net profit after tax of EUR1.0 million in line with management expectations (the
majority of tax arising is due to the disposal of Dallas Clean Energy LLC).
Total revenues for the period to 31 December 2008 were EUR41.5 million compared
with EUR10.4 million for the year to 31 December 2007.
The Carbon business generated EUR31.3m revenue for the year 2008 up from EUR2.9m in
2007. This significant increase reflects the conservative recognition of revenue
following achievement of registration and carbon credit operating status of
projects under management during 2008.
The Advisory business delivered EUR8.8 million in revenues and a segment loss of
EUR0.4 million in difficult trading conditions. The Advisory business continued to
reduce receivables bringing these in line with standard industry practice. Camco
expanded its consulting platform in China completing the acquisition of the 49%
minority interest in ESD Sinosphere Limited.
The Investments business sold Dallas Clean Energy landfill methane collection
and destruction plant for $19.1 million and completed the acquisition of
ClearWorld Energy Ventures Limited (CWEV) in China. The acquisition of CWEV
provides Camco with a platform for investment in the Chinese market.
As at 31 December 2008 the Company's has a net cash balance of EUR27.0 million.
The Directors consider the Company to be in a strong financial position from
which to continue its growth and market development strategy.
Segment Operational Review
Group
The Company has recently reorganised its management and organisational structure
in line with its expanded service offering. The Company has reorganised into
three independent business units; Carbon, Advisory and Investments. The Carbon
business unit manages the global Carbon emission project business. The Advisory
business unit consolidates the company's former consultancy businesses. The
Investment business unit will incorporate Camco's Ventures activities and will
refocus these activities on co-investment in projects and associated businesses
that produce carbon credits. The Company continues to look at other measures to
manage its costs effectively.
Carbon Credits
The Carbon business unit enjoyed a strong year with significant business
development, continued project validation and registration, and the successful
commercialisation of a portfolio of carbon credits.
The contracted portfolio comprised 155.3m tonnes (Adjusted PDD) / 100.1m tonnes
(Risk Adjusted) at 31 December 2008 with only small increases in the Contracted
portfolio occurring in the period to 31 March 2009. Camco has continued working
with project owners to form longer term joint ventures extending beyond 2012.
The average purchase price per tonne for the in specie portfolio declined from
EUR8.06 per tonne to EUR7.92 per tonne as a result of the registration and
de-risking of projects with low purchase prices.
The year has been significant for establishing Camco's reputation for achieving
project registrations under the CDM. The year to 31 December 2008 saw a further
20.4m tonnes (Risk Adjusted) registered with additional registrations under the
CDM since 31 December 2008 of 5.2 m tonnes (Risk Adjusted). Registrations
accelerated towards the end of 2008 and early in 2009 providing encouraging
signs of improvement in the administrative constraints that have impacted
project registration earlier in 2008. Carbon deliveries totalled 2.8m tonnes for
the year to 31 December 2008, with a change in the composition of credits being
delivered in 2006 and 2007 from Verified Emission Reductions (VERs) to CERs in
2008. This trend will continue as the CDM portfolio matures in 2009.
Camco added a commercialisation and structuring capacity that enhanced the
Company's ability to generate revenue through structured sales. This led to the
successful commercialisation of a portfolio of carbon credits announced on 28
August 2008. The portfolio was placed with leading international compliance
buyers. Under the deal CERs were delivered to the buyers on a non guaranteed
basis at a fixed price per CER, and Camco received an upfront, non-recourse cash
payment of EUR15.0 million. The sale of a second carbon asset portfolio was
deferred. Further, spot sales from projects were also undertaken.
The carbon development business in the United States continues to grow. In
December 2008 Camco signed a carbon development agreement with a leading US
dairy consulting firm to develop six ag methane projects that are anticipated to
yield 900,000 tCO2e over a 10-year period. This tonnage is in addition to the ag
methane project that Camco has already qualified and is commercialising in the
US.
The tables below outline the component parts of Camco's carbon portfolio and
include disclosure of the Risk Adjusted and Adjusted PDD (Project Design
Document) tonnes under management. Definitions of these classifications are
provided in Table 2 below.
Table 1 - Portfolio classifications
+-------------------------+----------------------------------------------------------+
| Portfolio | Definition |
| classification | |
+-------------------------+----------------------------------------------------------+
| Adjusted PDD | Includes PDD forecasts with adjustments downwards for |
| | known operational variances for some projects that had |
| | undergone a first verification. Projects contracted but |
| | assessed by Camco as currently unlikely to become |
| | operational are not included. |
| | |
+-------------------------+----------------------------------------------------------+
| Risk Adjusted | Fully risked delivery estimate reflecting known and |
| | anticipated regulatory, registration, verification, |
| | delay, operating and commercial risks across all |
| | projects in Camco's portfolio. |
+-------------------------+----------------------------------------------------------+
Table 2 - Overview of Camco's carbon credit portfolio by contract type
+----------------------------+------------+------------+------------+------------+
| Contract structure | 31 Mar 09 | 31 Dec 08 | 31 Mar 09 | 31 Dec 08 |
+----------------------------+------------+------------+------------+------------+
| | Adjusted | Adjusted | Risked | Risked |
| | PDD | PDD | | |
+----------------------------+------------+------------+------------+------------+
| | (m | (m | (m tonnes) | (m tonnes) |
| | tonnes)2 | tonnes)2 | | |
+----------------------------+------------+------------+------------+------------+
| | | | | |
+----------------------------+------------+------------+------------+------------+
| Carbon share | 124.1 | 122.6 | 79.6 | 76.3 |
+----------------------------+------------+------------+------------+------------+
| Carbon share held in | 51.1 | 48.4 | 32.0 | 30.7 |
| specie1 | | | | |
+----------------------------+------------+------------+------------+------------+
| Cash share | 24.7 | 26.0 | 14.6 | 17.2 |
+----------------------------+------------+------------+------------+------------+
| VERs | 7.3 | 6.7 | 6.7 | 6.6 |
+----------------------------+------------+------------+------------+------------+
+----------+---------------+
| 1 | Carbon |
| | share |
| | held in |
| | specie |
| | refers |
| | to the |
| | portion |
| | of the |
| | carbon |
| | asset |
| | portfolio |
| | over |
| | which |
| | Camco has |
| | an |
| | interest. |
+----------+---------------+
| 2 | Prior to |
| | validation |
| | or |
| | determination |
| | of official |
| | PDD |
| | forecasts, |
| | PDD numbers |
| | reflect |
| | Camco's |
| | current |
| | anticipated |
| | project |
| | delivery |
+----------+---------------+
Table 3 - Summary of Camco's carbon credit portfolio by stage
+------------------------+--------------+--------------+-------------+------------+
| Progress through | 31 Mar 09 | 31 Dec 08 | 31 Mar 09 | 31 Dec 08 |
| stage1 | | | | |
+------------------------+--------------+--------------+-------------+------------+
| | Adjusted PDD | Adjusted PDD | Risked | Risked |
+------------------------+--------------+--------------+-------------+------------+
| | (m tonnes) | (m tonnes) | (m tonnes) | (m tonnes) |
+------------------------+--------------+--------------+-------------+------------+
| | | | | |
+------------------------+--------------+--------------+-------------+------------+
| Contracted | 156.1 | 155.3 | 100.9 | 100.1 |
+------------------------+--------------+--------------+-------------+------------+
| PDD complete | 123.3 | 123.2 | 78.8 | 77.4 |
+------------------------+--------------+--------------+-------------+------------+
| Host LoA | 105.1 | 94.6 | 64.5 | 56.9 |
+------------------------+--------------+--------------+-------------+------------+
| Validated | 90.8 | 83.4 | 55.8 | 50.8 |
+------------------------+--------------+--------------+-------------+------------+
| Submitted for | 79.5 | 76.6 | 46.7 | 46.1 |
| registration | | | | |
+------------------------+--------------+--------------+-------------+------------+
| Registered | 78.3 | 67.7 | 46.0 | 40.4 |
+------------------------+--------------+--------------+-------------+------------+
| 1st verification2 | 25.5 | 22.1 | 18.3 | 16.1 |
+------------------------+--------------+--------------+-------------+------------+
| Issued | 5.6 | 5.5 | 5.6 | 5.5 |
+------------------------+--------------+--------------+-------------+------------+
| | | | | |
+------------------------+--------------+--------------+-------------+------------+
| Financed | 124.6 | 122.2 | 85.5 | 81.9 |
+------------------------+--------------+--------------+-------------+------------+
| Under construction | 117.4 | 117.4 | 81.4 | 78.6 |
+------------------------+--------------+--------------+-------------+------------+
| Operational | 97.6 | 97.5 | 67.8 | 64.9 |
+------------------------+--------------+--------------+-------------+------------+
+----+------------------------------------------------------------------------------+
| 1 | CDM stage or equivalent for JI and VER projects |
+----+------------------------------------------------------------------------------+
| 2 | Projects that have been through a minimum of one verification process or |
| | equivalent |
+----+------------------------------------------------------------------------------+
| 3 | Prior to validation or determination, PDD numbers reflect Camco's current |
| | anticipated project delivery |
+----+------------------------------------------------------------------------------+
Table 4 - Summary of Camco's In specie carbon credit portfolio1
+-----------------------------------------------------+-------------+-------------+
| Progress through stage2 | 31 Mar 09 | 31 Mar 09 |
+-----------------------------------------------------+-------------+-------------+
| | Adjusted | Risked |
| | PDD | |
+-----------------------------------------------------+-------------+-------------+
| | (m tonnes)4 | (m tonnes) |
+-----------------------------------------------------+-------------+-------------+
| | | |
+-----------------------------------------------------+-------------+-------------+
| Contracted | 51.1 | 32.0 |
+-----------------------------------------------------+-------------+-------------+
| PDD complete | 35.8 | 22.1 |
+-----------------------------------------------------+-------------+-------------+
| Host LoA | 29.2 | 17.0 |
+-----------------------------------------------------+-------------+-------------+
| Validated | 25.8 | 15.0 |
+-----------------------------------------------------+-------------+-------------+
| Submitted for registration | 22.5 | 11.9 |
+-----------------------------------------------------+-------------+-------------+
| Registered | 22.3 | 11.8 |
+-----------------------------------------------------+-------------+-------------+
| 1st verification3 | 2.9 | 2.2 |
+-----------------------------------------------------+-------------+-------------+
| Issued | 0.2 | 0.2 |
+-----------------------------------------------------+-------------+-------------+
+----+------------------------------------------------------------------------------+
| 1 | Camco's in specie portfolio excludes VERs |
+----+------------------------------------------------------------------------------+
| 2 | CDM stage or equivalent for JI and VER projects |
+----+------------------------------------------------------------------------------+
| 3 | Projects that have been through a minimum of one verification process or |
| | equivalent |
+----+------------------------------------------------------------------------------+
| 4 | Prior to validation or determination, PDD numbers reflect Camco's current |
| | anticipated project delivery |
+----+------------------------------------------------------------------------------+
Table 5 - Additional information on Camco's portfolio
+-----------------------------------------------------+------------+--------------+
| | 31 Mar 09 | 31 Dec 08 |
+-----------------------------------------------------+------------+--------------+
| | Risked | Risked |
+-----------------------------------------------------+------------+--------------+
| | (m tonnes) | (m tonnes) |
+-----------------------------------------------------+------------+--------------+
| Gross portfolio breakdown (m tonnes) | | |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| CERs | 67.7 | 68.2 |
+-----------------------------------------------------+------------+--------------+
| ERUs | 26.5 | 25.3 |
+-----------------------------------------------------+------------+--------------+
| VERs | 6.7 | 6.6 |
+-----------------------------------------------------+------------+--------------+
| Total | 100.9 | 100.1 |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| | 31 Mar 09 | 31 Dec 08 |
+-----------------------------------------------------+------------+--------------+
| | Risked | Risked |
+-----------------------------------------------------+------------+--------------+
| | (m tonnes) | (m tonnes) |
+-----------------------------------------------------+------------+--------------+
| Carbon share in specie (m tonnes) | | |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| CERs | 25.1 | 24.2 |
+-----------------------------------------------------+------------+--------------+
| ERUs | 6.9 | 6.5 |
+-----------------------------------------------------+------------+--------------+
| VERs | - | - |
+-----------------------------------------------------+------------+--------------+
| Total | 32.0 | 30.7 |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| Camco Portfolio and forward sales1 | | |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| Carbon share | 32.0 | 30.7 |
+-----------------------------------------------------+------------+--------------+
| Carbon share forward sold | 4.4 | 4.4 |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| Cash share | 14.6 | 17.2 |
+-----------------------------------------------------+------------+--------------+
| Cash share forward sold | 10.5 | 10.5 |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| VERs | 6.7 | 6.6 |
+-----------------------------------------------------+------------+--------------+
| VERs forward sold | 2.7 | 2.1 |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| Price - in specie portfolio | | |
+-----------------------------------------------------+------------+--------------+
| | | |
+-----------------------------------------------------+------------+--------------+
| Average purchase price | 7.92 | 8.06 |
+-----------------------------------------------------+------------+--------------+
+----+------------------------------------------------------------------------------+
| 1 | For a small number of forward sales some percentage of Camco's sale price |
| | remain linked to market prices. For example, Camco may receive a percentage |
| | of the market price in addition to a guaranteed floor price |
+----+------------------------------------------------------------------------------+
Advisory
Camco's Advisory business has performed well considering the extremely difficult
trading conditions. The UK Advisory business has a material exposure to the
construction industry through the provision of sustainable design services for
new construction. The economic downturn in the UK has seen a significant
contraction in this market. In China, reductions in foreign investment have
resulted in less than anticipated due diligence consulting assignments. Against
this backdrop the Advisory business is restructuring and redeploying its
workforce. For example, in the UK the introduction of the Carbon Reduction
Commitment (CRC) is creating demand for core advisory services amongst new and
existing clients. Moreover, demand for advisory services and its complement of
software solutions, which focus on areas such as energy efficiency, industrial
energy and resource management and other cost savings, have remained buoyant.
The Consultancy business has been rebranded Advisory to better reflect the
expanded and diverse services now being offered to customers. The Advisory
business's expansion has been focused on markets where strong demand for its
services has been proven. The wider range of services is allowing for stronger
relationships with customers and increasing revenue per customer. For example,
Camco has established a corporate-level partnership with Siemens to provide a
diverse set of carbon management services. To date, Camco has identified more
than 9,000 tonnes of potential emission reductions for nine Siemens' sites in
the UK, which equates to an overall reduction of 15% and cost savings to the
company of GBP2 million per year.
The Advisory business has continued to see benefits from knowledge sharing and
training between offices. Currently, Camco is working with AngloGold Ashanti, an
international gold producer based in South Africa, to develop its carbon
management and emission reduction strategy. This activity has included our teams
in Africa, the UK and the US. The acquisition of the minority share in ESD
Sinosphere in November 2008 has reinforced Camco's commitment to the Chinese
market. ESD Sinosphere enjoyed a substantial two-year contract win early in 2009
funded by the UK government to identify finance mechanisms and deliver GHG
emission reductions for China's iron and steel sector. Camco is ideally
positioned to benefit from the increase in funding from developed to developing
countries to support carbon reduction initiatives.
The UK's downturn in construction sector has impacted the Advisory business in
the UK, which has derived a significant amount of its business from the
provision of sustainable development and design services .Consequently, staff
resources are being redirected to growth areas such as carbon management and
industrial energy and resource management. It is anticipated that the
introduction of new policy requirements, such as the UK Carbon Reduction
Commitment (CRC), will generate new business opportunities.
Investments
Camco Investments deploys, manages and realises capital for Camco and external
investors. The Investment business is focused on financing projects that produce
carbon credits and on selective investments in businesses with proven clean
technologies and strong business plans.
The year to 31 December 2008 heralded some exciting developments for the
Investment business. On 18 August 2008, the sale at a profit of Camco's US
investment, Dallas Clean Energy, demonstrated the Company's ability to create
value in its Investment activities. The business was acquired on 3 December 2007
for US$13.1m and sold approximately nine months later for US$19.1m.
Camco owns 10% of renewable energy developer, Renewable Energy Partnership
(REP). In 2008 REP reached a successful milestone with planning approval
received for its Maerdy Windfarm in South Wales. The planned development is for
eight 3MW turbines with estimated electricity generation of 64,000 megawatt
hours (MWh) per year.
The acquisition of Clearworld Energy Ventures (now Camco Investments China) in
May 2008 significantly expanded the Investment business's capability in China.
Camco Investments in China will build on the leading market position of the
Camco brand name and enable the Group to create value through investments in
underlying project assets, technologies and related businesses.
Camco will continue to draw on the specialist expertise of its Advisory and
Carbon businesses to generate attractive investment opportunities globally.
Outlook
Carbon deliveries anticipated in 2009 will provide recurring, sustainable cash
flows. The delivery and commercialisation of these carbon credits is an
important step in executing the business plan outlined at the time of admission
to AIM. These deliveries will continue to grow with a significant increase
anticipated in 2010 and 2011.
Capitalising on its successful monetisation strategy, Camco intends to complete
structured carbon credit transactions when optimal to maximise value. The
reduction in primary price carbon credit price together with the reduced
competition in the market provides Camco with new business development
opportunities using innovative deal structures.
The Advisory business will continue to manage costs to achieve break even for
the whole business against a difficult operating environment in the UK. The
business will continue to grow in China and the integration of the various
elements of the consulting business will expose cross selling opportunities.
Camco will continue to expand and refocus its Investment business activities.
The Company will seek to divest non core Investment businesses where appropriate
value can be achieved. The Company will focus investment activities on the core
markets of the US and China.
Impact of post balance date transactions
Management Share Issue
Camco will apply for the issuance 3,467,388 new ordinary shares of EUR 0.01 each
in the capital of Camco ('Ordinary Shares') as part of the Camco International
Limited Long Term Incentive Plan (LTIP) (3,167,388 Ordinary Shares) and as
management bonuses outside the LTIP (300,000 Ordinary Shares). There will be a
further disclosure on the application for admission and details on the award of
the shares.
Camco International Limited
Abbreviated financial statements for the period from 1 January 2008 to 31
December 2008
Consolidated income statement
for the year ended 31 December 2008
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| | | | | 2008 | 2007 |
+-----------------------------------------------------+--+--+-----+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| Continuing operations | | Notes | EUR'000 | EUR'000 |
+-----------------------------------------------------+--+--------+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| Revenue | | | 2 | 41,463 | 10,444 |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Cost of sales | | | | (16,486) | (4,349) |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Gross profit | | | 2 | 24,977 | 6,095 |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Other income - net gain on disposal of investment | | | | 3,766 | - |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Other income - negative goodwill arising on | | | | 267 | - |
| acquisition | | | | | |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Administration expenses | | | 3 | (24,832) | (16,900) |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Other expense - net loss on fund establishment | | | 3 | (1,614) | - |
| costs | | | | | |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Profit/(loss) from operations | | | | 2,564 | (10,805) |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Finance income | | | 4 | 1,070 | 1,171 |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Finance expense | | | 4 | (1,408) | (2,582) |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Profit/(loss) before tax | | | | 2,226 | (12,216) |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Taxation | | | | (1,203) | 126 |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Profit/(loss) after tax | | | | 1,023 | (12,090) |
+-----------------------------------------------------+--+--+-----+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| Attributable to: | | | | | |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Equity holders of the Company | | | | | 1,134 | (12,131) |
+---------------------------------------+-------------+--+--+-----+----------+----------+
| Minority shareholders | | | | | (111) | 41 |
+---------------------------------------+-------------+--+--+-----+----------+----------+
| Profit/(loss) for the year | | | | | | 1,023 | (12,090) |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| Basic and diluted profit/(loss) per share in EUR | | | | | |
| cents | | | | | |
+-----------------------------------------------------+--+--+-----+----------+----------+
| Basic | | | | 5 | 0.62 | (8.18) |
+---------------------------------------+-------------+--+--+-----+----------+----------+
| Diluted | | | | 5 | 0.60 | (8.18) |
+---------------------------------------+-------------+--+--+-----+----------+----------+
| | | | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
| The results stated above are all derived from | | | | | |
| continuing operations. | | | | | |
+---------------------------------------+--+----------+--+--+-----+----------+----------+
Consolidated statement of recognised income and expense
for the year ended 31 December 2008
+--+--+-----------------------------------+----------+--+----------+----------+----------+
| | | | | | | 2008 | 2007 |
+--+--+-----------------------------------+----------+--+----------+----------+----------+
| | | | | | | | |
+--+--+-----------------------------------+----------+--+----------+----------+----------+
| | | | | | | EUR'000 | EUR'000 |
+--+--+-----------------------------------+----------+--+----------+----------+----------+
| | | | | | | | |
+--+--+-----------------------------------+----------+--+----------+----------+----------+
| Profit/(loss) for the year | | | | 1,023 | (12,090) |
+-----------------------------------------+----------+--+----------+----------+----------+
| Exchange differences on translation of | | | | (741) | 337 |
| foreign operations | | | | | |
+-----------------------------------------+----------+--+----------+----------+----------+
| Total recognised income and expense for the year | | | 282 | (11,753) |
+----------------------------------------------------+--+----------+----------+----------+
| Analysed to: | | | | | |
+-----------------------------------------+----------+--+----------+----------+----------+
| | Equity holders of the Company | | | | 393 | (11,794) |
+--+--------------------------------------+----------+--+----------+----------+----------+
| | Minority interest in subsidiary | | | | (111) | 41 |
| | companies | | | | | |
+--+--------------------------------------+----------+--+----------+----------+----------+
| | | | | | | 282 | (11,753) |
+--+--+-----------------------------------+----------+--+----------+----------+----------+
Camco International Limited
Balance sheets
as at 31 December 2008
+------------+--+----------------------------+------+-----+----------+----------+----------+----------+
| | | | | Group | Group | Company | Company |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| | | | | 2008 | 2007 | 2008 | 2007 |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| | | | | | | | |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| | | | Notes | EUR'000 | EUR'000 | EUR'000 | EUR'000 |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| | | | | | | | |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| Assets | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Non-current assets | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Property, plant and equipment | | 1,282 | 1,606 | 132 | 106 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Goodwill on acquisition | | 14,120 | 14,413 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Other intangible assets | | 1,794 | 1,463 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Investments in subsidiaries | | - | - | 17,226 | 18,020 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Other investments | | 209 | 275 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Deferred tax assets | | 292 | 414 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total non-current assets | | 17,697 | 18,171 | 17,358 | 18,126 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Current assets | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Work in progress - carbon development | | 8,490 | 13,302 | 5,639 | 8,642 |
| contracts | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Prepayments and accrued income | | 28,545 | 3,277 | 26,595 | 1,917 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Trade and other receivables | | 5,529 | 5,678 | 8,729 | 15,078 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Cash and cash equivalents | | 27,064 | 20,552 | 26,059 | 19,098 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Assets classified as held for sale | | - | 8,512 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total current assets | | 69,628 | 51,321 | 67,022 | 44,735 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total assets | 2 | 87,325 | 69,492 | 84,380 | 62,861 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| | | | | | | | |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| Liabilities | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Current liabilities | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Current | | | | (1,413) | (917) | - | - |
| tax | | | | | | | |
| liability | | | | | | | |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| Trade and other payables | | (23,767) | (5,759) | (19,941) | (1,172) |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Loans and borrowing | | (1,426) | (1,293) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Deferred consideration | | (702) | (1,861) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Liabilities classified as held for sale | | - | (143) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total current liabilities | | (27,308) | (9,973) | (19,941) | (1,172) |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Non-current liabilities | | | | | |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Loans and borrowing | | (75) | (297) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Provisions | | - | (203) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Deferred consideration | | (48) | (375) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Deferred tax liabilities | | (315) | (409) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total non-current liabilities | | (438) | (1,284) | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total liabilities | 2 | (27,746) | (11,257) | (19,941) | (1,172) |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Net assets | | 59,579 | 58,235 | 64,439 | 61,689 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| | | | | | | | |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| Equity | | | | | | |
+---------------+----------------------------+------------+----------+----------+----------+----------+
| Share capital | | 1,675 | 1,662 | 1,675 | 1,662 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Share premium | | 71,619 | 70,997 | 71,619 | 70,997 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Share-based payment reserve | | 2,751 | 2,567 | 2,751 | 2,567 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Retained earnings | | (14,972) | (16,106) | (10,436) | (12,266) |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Translation reserve | | (426) | 315 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Own shares | | (1,170) | (1,271) | (1,170) | (1,271) |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Minority interest | | 102 | 71 | - | - |
+--------------------------------------------+------------+----------+----------+----------+----------+
| Total equity | | 59,579 | 58,235 | 64,439 | 61,689 |
+--------------------------------------------+------------+----------+----------+----------+----------+
| | | | | | | | |
+------------+--+----------------------------+------------+----------+----------+----------+----------+
| These financial statements were approved by the Board of Directors on 5 April 2009 and | |
| were signed on its behalf by: | |
+------------------------------------------------------------------------------------------+----------+
| | | | | | | | |
+------------+--+-----------------------------------+-----+----------+----------+----------+----------+
| Scott McGregor | | | | | |
+---------------------------------------------------+-----+----------+----------+----------+----------+
| Chief Financial Officer | | | | | |
+---------------------------------------------------+-----+----------+----------+----------+----------+
| Director | | | | | | |
+------------+--+----------------------------+------+-----+----------+----------+----------+----------+
Camco International Limited
Cash flow statements
for the year ended 31 December 2008
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | | Group | Group | Company | Company |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | | 2008 | 2007 | 2008 | 2007 |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | Notes | EUR'000 | EUR'000 | EUR'000 | EUR'000 |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| Cash flow from operating activities | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Revenue, payments on account and deferred | | 30,539 | 8,573 | 20,579 | 2,919 |
| income received | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Cash paid to suppliers | | (20,664) | (12,298) | (9,328) | (8,015) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Cash paid to employees | | (13,257) | (8,468) | (586) | (120) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Interest received | | 935 | 1,254 | 779 | 1,228 |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Interest paid | | (83) | (72) | (1) | - |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Service fees paid to subsidiaries | | - | - | (7,793) | (5,626) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Income tax paid | | (790) | (72) | - | - |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Net cash flow from operating activities | | (3,320) | (11,083) | 3,650 | (9,614) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| Cash flow from investing activities | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Disposal of investment, net cash disposed | | 11,182 | - | - | - |
| of | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Payment for acquisition of subsidiaries | | (348) | (5,295) | (27) | (4,710) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Net cash/(overdraft) acquired with | | 55 | (985) | - | - |
| subsidiaries | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Payment for purchase of property, plant and | | (621) | (1,187) | (101) | (12) |
| equipment | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Payment for asset held | | | | - | (8,369) | - | - |
| for sale | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| Net cash flow from | | | | 10,268 | (15,836) | (128) | (4,722) |
| investing activities | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| Cash flow from financing activities | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Loans repaid/(made) to subsidiaries | | - | - | 4,744 | (12,560) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Capital contribution paid | | - | - | (864) | - |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Repayment of loans and borrowing | | (163) | - | - | - |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Proceeds from issuance of shares | | - | 24,280 | - | 24,280 |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Costs of raising capital | | - | (357) | - | (357) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Payment of finance lease liabilities | | (242) | (201) | - | - |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Net cash flow from | | | | (405) | 23,722 | 3,880 | 11,363 |
| financing activities | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| | | | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
| Change in cash and cash equivalents and | | 6,543 | (3,197) | 7,402 | (2,973) |
| bank overdraft | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Opening cash and cash equivalents and bank | | 19,613 | 24,719 | 19,098 | 24,063 |
| overdraft | | | | | |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Effect of exchange rate fluctuations | | (1) | (1,909) | (441) | (1,992) |
+---------------------------------------------+--------+----------+----------+----------+----------+
| Closing cash and cash equivalents and bank | | 26,155 | 19,613 | 26,059 | 19,098 |
| overdraft | | | | | |
+--------------------------+---+--------------+--------+----------+----------+----------+----------+
Camco International Limited
+-------------------------------------------------------------------------------------+---------+---------+---------+---------+---------+
| Notes to the interim financial report | | | | | |
| 1 Significant accounting policies | | | | | |
| Camco International Limited (the "Company") is a public company incorporated | | | | | |
| in Jersey under the Companies (Jersey) Law 1991. The address of its registered | | | | | |
| office is Channel House, Green Street, St Helier, Jersey JE2 4UH. The | | | | | |
| consolidated financial statements of the Company for the year ended 31 | | | | | |
| December 2008 comprise the Company, its subsidiaries and associates and | | | | | |
| jointed controlled entities (together the "Group"). Separate financial | | | | | |
| statements of the Company are also presented. The accounting policies of the | | | | | |
| Company are the same as for the Group except where separately disclosed. | | | | | |
| The Company is admitted to the Alternative Investment Market ("AIM") of the | | | | | |
| London Stock Exchange. | | | | | |
| A Statement of compliance | | | | | |
| These consolidated and separate financial statements have been prepared and | | | | | |
| approved by the Directors in accordance with International Financial Reporting | | | | | |
| Standards as adopted by the European Union ("adopted IFRS"). | | | | | |
| These consolidated and separate financial statements have been prepared in | | | | | |
| accordance with and in compliance with the Companies (Jersey) Law 1991. | | | | | |
| The consolidated and separate financial statements were approved by the Board | | | | | |
| on 5 April 2009. | | | | | |
| B Basis of preparation | | | | | |
| The financial statements have been prepared on the historical cost basis and | | | | | |
| on a going concern basis. | | | | | |
| The Group has considerable financial resources together with long-term | | | | | |
| contracts with a number of customers and suppliers across different geographic | | | | | |
| areas and industries. As a consequence, the Directors believe that the Group | | | | | |
| is well placed to manage its business risks successfully despite the current | | | | | |
| uncertain economic outlook. | | | | | |
| After making enquiries, the Directors have a reasonable expectation that the | | | | | |
| Company and the Group have adequate resources to continue in operational | | | | | |
| existence for the foreseeable future. Accordingly, they continue to adopt the | | | | | |
| going concern basis in preparing the annual report and accounts. | | | | | |
| C Accounting for Carbon Development Contracts ("CDCs") | | | | | |
| The Group enters into CDCs with clients from which carbon credits are | | | | | |
| produced. Carbon credits under the Kyoto Protocol, also known as Certified | | | | | |
| Emission Reductions ("CERs") or Emission Reduction Units ("ERUs") are | | | | | |
| generated through the highly regulated Carbon Development Mechanism ("CDM") | | | | | |
| and Joint Implementation ("JI") processes respectively. These follow a number | | | | | |
| of steps including the approval of the project methodology and monitoring | | | | | |
| procedures, project design, project approval by the Designated National | | | | | |
| Authority ("DNA"), project validation by a Designated Operational Entity or | | | | | |
| equivalent ("DOE"), project acceptance by the host country, registration, | | | | | |
| verification and certification by a DOE. Verification of carbon credit | | | | | |
| production takes place at least once a year during the production period. The | | | | | |
| Group works with the client at all stages of the process using proprietary | | | | | |
| knowledge and experience to negotiate this complex process. Carbon credits are | | | | | |
| also generated outside the Kyoto Protocol under voluntary or regional emission | | | | | |
| reduction schemes. | | | | | |
| Revenue recognition on CDC consultancy services | | | | | |
| The Group derives revenue from the provision of consultancy services to carbon | | | | | |
| project clients under CDCs. The Group receives payment for the services by | | | | | |
| either commission or non cash carbon credit contracts. Revenue from CDCs is | | | | | |
| only recognised once the Group's services to secure the production of carbon | | | | | |
| credits are significantly complete and their receipt can be forecast reliably. | | | | | |
| Revenue is recognised once a CDC is registered by a DOE and the carbon credit | | | | | |
| project is operational. Carbon credits may be generated over subsequent | | | | | |
| periods as they are issued. The amount and timing of commission or carbon | | | | | |
| credits to be received may be dependent upon the number of carbon credits | | | | | |
| received by the customers, which is determined by assessing the specific | | | | | |
| technical, contract and economic risks identified on the project. | | | | | |
| Revenue is recognised at the fair value of the consideration receivable from | | | | | |
| the contracts, at which point accrued income is recognised. The fair value is | | | | | |
| the estimated net value of the carbon credits to be received, which is | | | | | |
| dependent upon the expected number to be delivered and the intrinsic value. If | | | | | |
| the expected number or value of the carbon credits subsequently changes an | | | | | |
| adjustment is made to the accrued income balance with an associated credit or | | | | | |
| debit taken to revenue. The unwinding of any financing element of accrued | | | | | |
| income is recognised as finance income or expense. | | | | | |
| The CDCs are scheduled to deliver the majority of carbon credits over the | | | | | |
| 2008-2012 phase of the Kyoto Protocol. | | | | | |
| Camco International Limited | | | | | |
| Notes to the interim financial report (continued) | | | | | |
| 1 Significant accounting policies (continued) | | | | | |
| Treatment of CDC costs | | | | | |
| In light of developments in the market for carbon credits and the start of the | | | | | |
| 2008-2012 phase of the Kyoto protocol, the Directors have reconsidered the | | | | | |
| operating cycle and have concluded that the CDC costs are now better presented | | | | | |
| under current assets as work in progress and the comparatives have been | | | | | |
| represented. | | | | | |
| CDCs acquired by the Group are recorded initially at cost (or fair value if | | | | | |
| through business combination). | | | | | |
| Subsequently, the directly attributable costs are added to the carrying amount | | | | | |
| of CDCs. These costs are only carried forward to the extent that they are | | | | | |
| expected to be recouped through the successful completion of the contracts. | | | | | |
| The costs comprise consultancy fees, license costs, technical work and | | | | | |
| directly attributable administrative costs. All other costs are expensed as | | | | | |
| incurred. CDC costs carried as work in progress are stated at the lower of | | | | | |
| cost and net realisable value. | | | | | |
| D Revenue recognition on other consultancy services | | | | | |
| Advisory revenue from consultancy services provided is recognised in the | | | | | |
| income statement in proportion to the stage of completion of the consultancy | | | | | |
| contract. The stage of completion is assessed by reference to the overall | | | | | |
| contract value. | | | | | |
| 2 Segmental reporting | | | | | |
| Segment information is presented in respect of the Group's business segments. | | | | | |
| The business segments are based on the Group's management and internal | | | | | |
| reporting structure. | | | | | |
| Segment results, assets and liabilities include items directly attributable to | | | | | |
| a segment as well as those that can be allocated to a segment on a reasonable | | | | | |
| basis. | | | | | |
| Segment capital expenditure is the total cost incurred during the year to | | | | | |
| acquire segment assets, that are expected to be used for more than one period. | | | | | |
| Business Segments | | | | | |
| The Group comprises the following main business segments: | | | | | |
| 1. Carbon: CDC consultancy services provided on carbon asset development, | | | | | |
| commercialisation and portfolio management. | | | | | |
| 2. Advisory: The Group's advisory consulting practice providing clients with | | | | | |
| low carbon energy and sustainable development solutions. | | | | | |
| 3. Investments: Enters into partnerships with project and technology | | | | | |
| developers to commercialise climate change mitigation technologies and develop | | | | | |
| project assets. | | | | | |
| | | | | | |
+-------------------------------------------------------------------------------------+---------+---------+---------+---------+---------+
Camco International Limited
Notes to the interim financial report (continued)
2 Segmental reporting (continued)
+-----------------------------------------------------------------------------------------------------------------------------+
| Business |
| Segments |
| Carbon Advisory Investments Eliminations Consolidated |
| 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 |
| EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 |
| Revenue 31,340 2,875 8,027 6,924 2,096 645 - - 41,463 10,444 |
| Inter-segment - - 809 496 - - (809) (496) - - |
| revenue |
| |
| |
| Total segment 31,340 2,875 8,836 7,420 2,096 645 (809) (496) 41,463 10,444 |
| revenue |
| |
| |
| Segment gross 17,372 1,090 7,389 5,148 1,025 353 (809) (496) 24,977 6,095 |
| margin |
| Segment result 7,884 (6,026) (437) 406 1,279 (776) - - 8,726 (6,396) |
| |
| |
| Unallocated (5,487) (2,381) |
| expenses |
| Share-based (675) (2,028) |
| payments |
| |
| |
| Results from 2,564 (10,805) |
| operating |
| activities |
| |
| Net finance (338) (1,411) |
| (expense)/income |
| Taxation (1,203) 126 |
| |
| |
| Profit (Loss) 1,023 (12,090) |
| for the period |
| |
| |
| Segment assets 70,272 45,321 13,266 20,729 2,712 146 - - 86,250 66,196 |
| Other - - 209 275 - - 209 275 |
| investments |
| Unallocated 866 3,021 |
| assets |
| |
| |
| Total assets 87,325 69,492 |
| |
| |
| |
| Segment (22,178) (3,190) (3,073) (4,377) (2,015) (997) - - (27,266) (8,564) |
| liabilities |
| Unallocated (480) (2,693) |
| liabilities |
| |
| |
| Total (27,746) (11,257) |
| liabilities |
| |
| |
| Capital 462 1,028 401 335 - 25 - 863 1,388 |
| expenditure |
| Depreciation 390 169 330 210 6 - - 726 379 |
| Amortisation - - 337 222 - - - 337 222 |
| of intangible |
| assets |
| Impairment - 153 - - 167 - - 167 153 |
| losses of |
| intangible |
| assets and |
| property, |
| plant and |
| equipment |
| |
| |
+-----------------------------------------------------------------------------------------------------------------------------+
Camco International Limited
Notes to the interim financial report (continued)
+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+
| 3 Total administration expenses |
| Total administration expenses 2008 2007 |
| are analysed below. |
| EUR'000 EUR'000 |
| Depreciation of property, plant and equipment - 504 232 |
| owned assets |
| Depreciation of property, plant and equipment - 222 147 |
| leased assets |
| Share-based payments 675 2,028 |
| Amortisation of intangible 337 222 |
| assets |
| Impairment losses of intangible 167 - |
| assets |
| Other administration expenses 22,927 14,271 |
| Administration expenses 24,832 16,900 |
| Other expense - net loss on fund establishment 1,614 - |
| costs |
| 26,446 16,900 |
| |
+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| 2008 2007 |
| EUR'000 EUR'000 |
| Finance income |
| Interest on bank deposits 754 1,171 |
| Unwinding of discount on 163 - |
| accrued revenue |
| Exchange movements - realised 153 - |
| 1,070 1,171 |
| Finance expense |
| Unwinding of discount on deferred consideration (108) (97) |
| Interest on overdraft and borrowings (81) (72) |
| Interest on finance lease (22) (22) |
| creditor |
| Other interest (438) - |
| Exchange movements - (731) (2,256) |
| unrealised |
| Exchange movements - realised (28) (135) |
| (1,408) (2,582) |
| Net finance income (338) (1,411) |
| |
+-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------+
| | | | | | | | | | |
+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+
| |
+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+----------------------+
Camco International Limited
Notes to the interim financial report (continued)
+-----------------------------------+-------------------+------------------+---------------+
| 5 Profit/(loss) per share |
+------------------------------------------------------------------------------------------+
| Profit/(loss) per share attributable to equity | 2008 | 2007 |
| holders of the Company is calculated as follows. | | |
+-------------------------------------------------------+------------------+---------------+
| | | EUR cents | EUR cents |
| | | per share | per share |
+-----------------------------------+-------------------+------------------+---------------+
| Basic profit/(loss) per share | | 0.62 | (8.18) |
+-----------------------------------+-------------------+------------------+---------------+
| Diluted profit/(loss) per share | | 0.60 | (8.18) |
+-----------------------------------+-------------------+------------------+---------------+
| | | | |
+-----------------------------------+-------------------+------------------+---------------+
| | | EUR'000 | EUR'000 |
+-----------------------------------+-------------------+------------------+---------------+
| Profit/(loss) used in calculation of basic and | 1,023 | (12,090) |
| diluted profit(/loss) per share - no dilutive effects | | |
+-------------------------------------------------------+------------------+---------------+
| Weighted average number of shares used in calculation | 165,314,890 | 147,762,389 |
| - basic | | |
+-------------------------------------------------------+------------------+---------------+
| Weighted average number of shares used in calculation | 171,061,611 | 147,762,389 |
| - diluted | | |
+-------------------------------------------------------+------------------+---------------+
| As the shares that will be used to satisfy share options have already been issued to the |
| Employee Benefit Trust and none of the vesting conditions of the LTIP were satisfied at |
| the balance sheet date, there is no difference between the basic and diluted loss per |
| share. |
+------------------------------------------------------------------------------------------+
| | | | |
+-----------------------------------+-------------------+------------------+---------------+
| Weighted average number of shares used in calculation | Company | Company |
| - basic | | |
+-------------------------------------------------------+------------------+---------------+
| | | 2008 | 2007 |
+-----------------------------------+-------------------+------------------+---------------+
| | | | |
+-----------------------------------+-------------------+------------------+---------------+
| | | Number | Number |
+-----------------------------------+-------------------+------------------+---------------+
| Number in issue at 1 January 2008 & 2007 | 166,151,068 | 129,898,733 |
+-------------------------------------------------------+------------------+---------------+
| Effect of own shares held | (3,470,476) | (4,604,407) |
+-------------------------------------------------------+------------------+---------------+
| Effect of share options exercised | | 1,750,027 | 1,255,607 |
+-----------------------------------+-------------------+------------------+---------------+
| Effect of shares issued in the | | 884,271 | 21,212,456 |
| period | | | |
+-----------------------------------+-------------------+------------------+---------------+
| Weighted average number of basic shares at 31 | 165,314,890 | 147,762,389 |
| December 2008 & 2007 | | |
+-------------------------------------------------------+------------------+---------------+
| | | | |
+-----------------------------------+-------------------+------------------+---------------+
| Weighted average number of shares used in calculation | Company | Company |
| - diluted | | |
+-------------------------------------------------------+------------------+---------------+
| | | 2008 | 2007 |
+-----------------------------------+-------------------+------------------+---------------+
| | | | |
+-----------------------------------+-------------------+------------------+---------------+
| | | Number | Number |
+-----------------------------------+-------------------+------------------+---------------+
| Number in issue at 1 January 2008 & 2007 | 166,151,068 | 129,898,733 |
+-------------------------------------------------------+------------------+---------------+
| Effect of own shares held | (3,470,476) | (4,604,407) |
+-------------------------------------------------------+------------------+---------------+
| Effect of share options exercised | | 1,750,027 | 1,255,607 |
+-----------------------------------+-------------------+------------------+---------------+
| Effect of shares issued in the | | 884,271 | 21,212,456 |
| period | | | |
+-----------------------------------+-------------------+------------------+---------------+
| Dilutive effect of share options | | 3,016,810 | - |
| granted | | | |
+-----------------------------------+-------------------+------------------+---------------+
| Dilutive effect of deferred consideration expected to | 2,729,911 | - |
| settle in shares | | |
+-------------------------------------------------------+------------------+---------------+
| Weighted average number of diluted shares at 31 | 171,061,611 | 147,762,389 |
| December 2008 & 2007 | | |
+-----------------------------------+-------------------+------------------+---------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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