TIDMSXX

RNS Number : 5036U

Sirius Minerals Plc

30 July 2015

30 July 2015

Sirius Minerals Plc

Financial results for the year ended 31 March 2015

The Directors of Sirius Minerals Plc (AIM: SXX, OTCQX: SRUXY) ("Sirius" or the "Company") announce the results for Sirius and its subsidiaries ("the Group") for the year ended 31 March 2015.

Key highlights

-- Take-or-pay offtake agreement with large Central American fertilizer distributor for 250,000 tonnes per annum of polyhalite, ramping up over five years.

-- Take-or-pay offtake agreement with a leading South American fertilizer distributor for 300,000 tonnes per annum over seven years.

   --     500,000 tonnes per annum of polyhalite under one memorandum of understanding. 
   --     396,000 tonnes per annum of polyhalite under letters of intent. 

-- Memorandum of Understanding signed with Tanzanian Ministry of Agriculture in Tanzania, supporting collaboration on research on polyhalite for the introduction of polyhalite into Tanzania.

-- Verification that polyhalite has nutritional benefits for animals and maiden animal feed take-or-pay offtake agreement for a long term supply of 50,000 tonnes per annum of polyhalite.

-- Range of positive crop study results demonstrating the value of polyhalite on crops of commercial significance through field trials across the globe announced in agronomy updates and webcasts.

   --    Appointment of new Group Chief Financial Officer, Thomas Staley. 
   --    Oversubscribed share placing raising GBP15 million. 

-- Community engagement showed high levels of public support with 98% of people in favour of the York Potash Project ("the Project").

   --     Planning approval submissions made for the York Potash Project. 

Post balance sheet events

-- Successful resolutions to grant planning permissions for key approvals required to develop the Project, including the mine and mineral transport system, the materials handling facility and the temporary construction park and ride facility.

-- The proposed development consent order for Harbour Facilities at Teesside has been accepted for examination by the Planning Inspectorate. A final decision is due to be made by the Secretary of State for Transport no later than summer 2016.

-- Noel Harwerth and Jane Lodge appointed to the Board as independent non-executive directors with Chris Catlow and Peter Woods stepping down.

Financials

The Group's year-end cash and cash equivalents position as at 31 March 2015 was GBP26.6 million (2014: GBP48.4 million). The Group's loss for the year ended 31 March 2015 was GBP10.0 million (2014: GBP8.0 million).

Annual Report and Accounts

The Annual Report and Accounts have now been published on the Company's website: www.siriusminerals.com. The Annual Report and Accounts will also be posted to shareholders shortly.

For further information, please contact:

 
 Sirius Minerals Plc 
  Investor Relations            Email: ir@siriusminerals.com     Tel: +44 845 
                                                                     524 0247 
---------------------------  -------------------------------  --------------- 
 Joint Brokers 
  Liberum Capital Limited       Clayton Bush                      Tel: +44 20 
                                                                    3100 2222 
 Macquarie Capital (Europe)   Ken Fleming,                        Tel: +44 20 
  Limited (NOMAD)              Nick Harland,                        3037 2000 
                               Nick Stamp 
 WH Ireland                   Adrian Hadden                       Tel: +44 20 
                                                                    7220 1666 
---------------------------  -------------------------------  --------------- 
 Media Enquiries              Jos Simson, Mike                    Tel: +44 20 
  Tavistock                    Bartlett,                            7920 3150 
                               Emily Fenton 
---------------------------  -------------------------------  --------------- 
 Warrant Trading Enquiries 
  Liberum Capital Limited       Simon Smith                       Tel: +44 20 
                                                                    3100 2171 
---------------------------  -------------------------------  --------------- 
 

About Sirius Minerals Plc

Sirius Minerals is the fertilizer development company focused on the development of the York Potash Project in the United Kingdom, which has the world's largest and highest grade deposit of polyhalite, a multi-nutrient form of potash containing potassium, sulphur, magnesium and calcium. Incorporated in 2003, Sirius Minerals' shares are traded on the London Stock Exchange's AIM market. Its shares are also traded in the United States on the OTCQX through a sponsored ADR facility. Further information on the Company can be found at: www.siriusminerals.com.

CHAIRMAN'S STATEMENT

Dear Shareholders

This is my fourth year of submitting a Chairman's statement to you and I believe this year we can look forward with ever more confidence to the long-term success of the Group.

It has been a year dominated by three key work streams: planning approvals, the ongoing preparation of our definitive feasibility study (DFS) and the continued progress of our sales and marketing efforts.

Last year I said that 2014-2015 would be a defining period for the Group, but it is only a step on our way to fulfilling the Group's true potential. And so it has turned out to be, with the year dominated by our focus on achieving planning consent for the key parts of the York Potash Project (the Project). Although final positive planning decisions came outside of the 2014-2015 financial year, it would be remiss not to reference these successes as part of this report.

It is often difficult to properly explain to external observers the level of work and effort that goes into preparing planning applications, especially the nature of the applications that have been required for this Project. Although most public focus has been on the North York Moors National Park Authority (NYMNPA), there have been six applications submitted for the critical infrastructure that supports the Project's construction and operational requirements. The number of studies, reviews, drafts, comments, consultations and documents has been quite staggering.

At times during the financial year people will have been frustrated by apparent delays, as examples, when we chose to change the Project's design to incorporate a tunnel-based mineral transport system (MTS) and then to merge the mine and MTS applications, resulting in the submission of the former being delayed to align with the latter. But as a project of this scale and nature evolves, you have to adapt the strategy, and those decisions have turned out to have been the right ones.

Similarly in projects of this size, and where there is a desire to submit the applications as quickly as possible, there are inevitably corrections and clarifications to provide along the way, as well as additional information. Our in-house and consultancy teams led by Allan Gamble did a fantastic job to compile such a comprehensive and timely set of documents in the package of supplementary environmental information in February 2015, which ultimately set us on the final path towards approval.

Our first key planning approval came from Scarborough Borough Council (SBC) for the construction park and ride and workers accommodation. Progress was subsequently made with the mine and MTS application and then the materials handling facility application at Redcar and Cleveland Borough Council (RCBC). This was followed by the positive consideration of the mine and mineral transport system planning application by the NYMNPA. I would like thank all the local authorities for their hard work in determining the applications. We do believe that the long-term economic benefits of the Project will be substantial for the local area, region and nation as a whole. We look forward to continuing to delivering both these benefits and our commitment to the York Potash Foundation (YPF) that can provide a positive lasting legacy to the area.

The development consent order for the harbour facilities has been submitted and in April 2015 it was accepted for future examination. We anticipate a decision will be made by the Planning Inspectorate in summer 2016.

Another large component of the Company's work in 2014-2015 has been behind the scenes with the ongoing preparation of the DFS. Whilst large amounts of it have been concluded, the overall finalisation of the DFS awaited the receipt of key project approvals and the completion of the key tenders that were being run throughout the year.

The past year was also notable for the ongoing progress in sales and marketing. This has ranged from the advancement of sales commitments to the further development and growth of the global agronomy programme. To have secured an increasing number of take-or-pay contracts in an industry where traditionally long-term contracts are not the norm, is testament to our progress.

Sirius Minerals's trademarked polyhalite product, POLY4, has natural nutrient advantages offering better agronomical and economic benefits over a range of other fertilizer products. We believe the unique characteristics of POLY4, combined with the healthy cash margins expected from the Project, differentiate Sirius Minerals from other companies in the fertilizer industry.

From a management team perspective we have now established an effective group that are pushing the Company forward to achieve its goals. I see on a daily basis the hard work that, from the top to the most junior level of our team, is going into making the Company a success for the benefit of all our shareholders. Of particular note in December 2014 was the promotion of Thomas Staley to the Chief Financial Officer role. His energy and experience is proving to be a great asset to the Company.

Since the year end we have seen the departure of two long-standing non-executive directors, Deputy Chairman Chris Catlow and Peter Woods. I wish them both well in their future endeavours. We have added to the Board two very experienced independent non-executive directors, Noel Harwerth and Jane Lodge. Both ladies bring an impressive breadth of corporate executive and board experience to our company, and their collective finance, mining, construction and accounting backgrounds will be very useful to Sirius Minerals throughout our next phase of development.

The financial year saw the Group deliver an important financing in February 2015, when we raised GBP15 million from an oversubscribed equity placement. Financing is never undertaken lightly, and there is always a balance between minimising dilution of existing shareholders and maintaining the Project's momentum. In this instance it was prudent to execute the transaction so we could maintain time-critical engineering work and have comfort that we were funded beyond the planning decision if we were driven into an appeal period.

Our financing ability and corporate strategy is fundamentally different following the grant of the key-approvals. We expect to provide further detail to shareholders throughout the 2015-2016 financial year. To gain an understanding of our future plans, people should realise that our target is, very definitely, to bring a world-class fertilizer company into production. This means that any financings before reaching that first production target are important and are stepping stones to deliver a lower operating cost structure appropriate for profitable operations to unlock shareholder value and returns. We will take such decisions with the best interests of all shareholders in mind.

The financial year ahead will be an exciting period as we look to secure appropriate funding to begin construction and ultimately reach our goal of becoming a large-scale, multi-nutrient fertilizer producer. That has always been at the heart of our strategy - to maximise long-term shareholder value.

I thank you for your loyal support and hope that it continues into the year ahead and beyond.

Kind regards,

Russell Scrimshaw

Chairman

 
CONSOLIDATED INCOME STATEMENT 
for the year ended 31 March 2015 
 
 
                                  2015      2014 
                               GBP000s   GBP000s 
----------------------------  --------  -------- 
Revenue                              -         - 
Administrative expenses       (10,047)   (9,115) 
----------------------------  --------  -------- 
Operating loss                (10,047)   (9,115) 
Finance income                     332        49 
Finance costs                    (353)   (1,063) 
----------------------------  --------  -------- 
Loss before taxation          (10,068)  (10,129) 
Taxation                           503     2,151 
----------------------------  --------  -------- 
Loss for the financial year    (9,565)   (7,978) 
----------------------------  --------  -------- 
Loss per share: 
Basic and diluted               (0.5)p    (0.5)p 
----------------------------  --------  -------- 
 
 
CONSOLIDATED STATEMENT OF 
COMPREHENSIVE INCOME 
for the year ended 31 March 2015 
 
 
                                                                      2015     2014 
                                                                   GBP000s  GBP000s 
-----------------------------------------------------------------  -------  ------- 
Loss for the financial year attributable to owners of the parent   (9,565)  (7,978) 
-----------------------------------------------------------------  -------  ------- 
Other comprehensive income/(loss) 
Items that may be subsequently reclassified to profit or loss 
Exchange differences on translating foreign operations               (346)      210 
-----------------------------------------------------------------  -------  ------- 
Other comprehensive income/(loss) for the year                       (346)      210 
-----------------------------------------------------------------  -------  ------- 
Total comprehensive loss for the year                              (9,911)  (7,768) 
-----------------------------------------------------------------  -------  ------- 
 
 
Total comprehensive loss shown above is fully attributable to equity shareholders of the parent 
 in both years. 
 
 
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
as at 31 March 2015 
 
 
                                    2015      2014 
ASSETS                           GBP000s   GBP000s 
------------------------------  --------  -------- 
Non-current assets 
Property, plant and equipment      1,932     2,116 
Intangible assets                121,721    92,814 
------------------------------  --------  -------- 
Total non-current assets         123,653    94,930 
------------------------------  --------  -------- 
Current assets 
Other receivables                  1,413     1,046 
Cash and cash equivalents         26,640    48,404 
Total current assets              28,053    49,450 
------------------------------  --------  -------- 
TOTAL ASSETS                     151,706   144,380 
------------------------------  --------  -------- 
EQUITY AND LIABILITIES 
Equity 
Share capital                      5,362     4,658 
Share premium account            216,586   197,797 
Share based payment reserve       13,290    11,404 
Accumulated losses              (95,630)  (86,360) 
Foreign exchange reserve           7,028     7,374 
------------------------------  --------  -------- 
Total equity                     146,636   134,873 
------------------------------  --------  -------- 
Current liabilities 
 Loan from third parties           1,980     5,340 
Trade and other payables           3,090     4,167 
------------------------------  --------  -------- 
Total liabilities                  5,070     9,507 
------------------------------  --------  -------- 
TOTAL EQUITY AND LIABILITIES     151,706   144,380 
------------------------------  --------  -------- 
 
 
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 
for the year ended 31 March 2015 
 
 
                                                                      Share                           Equity 
                                                            Share     based                Foreign    share- 
                                                   Share  premium  payments  Accumulated  exchange  holders' 
                                                 capital  account   reserve       losses   reserve     funds 
                                                 GBP000s  GBP000s   GBP000s      GBP000s   GBP000s   GBP000s 
-----------------------------------------------  -------  -------  --------  -----------  --------  -------- 
At 31 March 2013                                   3,359  147,763    10,345     (79,392)     7,164    89,239 
Loss for the financial year                            -        -         -      (7,978)         -   (7,978) 
Foreign exchange differences on 
translation of foreign operations                      -        -         -            -       210       210 
-----------------------------------------------  -------  -------  --------  -----------  --------  -------- 
Total comprehensive loss for the year                  -        -         -      (7,978)       210   (7,768) 
Convertible loan                                     368    9,562         -        1,010         -    10,940 
Share issue                                          897   42,147       897            -         -    43,941 
Share issue costs                                      -  (2,180)         -            -         -   (2,180) 
Share based payments                                  27        -       162            -         -       189 
Exercised options                                      7      505         -            -         -       512 
At 31 March 2014                                   4,658  197,797    11,404     (86,360)     7,374   134,873 
Loss for the financial year                            -        -         -      (9,565)         -   (9,565) 
Foreign exchange differences on 
translation of foreign operations                      -        -         -            -     (346)     (346) 
-----------------------------------------------  -------  -------  --------  -----------  --------  -------- 
Total comprehensive (loss)/income for the year         -        -         -      (9,565)     (346)   (9,911) 
Convertible loan                                     113    3,287         -          295         -     3,695 
Share Issue                                          572   15,853         -            -         -    16,425 
Share Issue costs                                      -    (665)         -            -         -     (665) 
Share based payments                                   -        -     1,886            -         -     1,886 
Exercised options                                     19      314         -            -         -       333 
At 31 March 2015                                   5,362  216,586    13,290     (95,630)     7,028   146,636 
-----------------------------------------------  -------  -------  --------  -----------  --------  -------- 
 
 
The share premium account is used to record the excess proceeds over nominal value on 
 the 
 issue of shares. 
 
 The share based payment reserve is used to record the share based payments made by the 
 Group. 
 
 Foreign exchange reserve records exchanges differences which arise on translation of 
 foreign 
 operations with a functional currency other than Sterling. 
CONSOLIDATED STATEMENT OF CASH FLOWS 
for the year ended 31 March 2015 
 
 
                                                           2015      2014 
                                                        GBP000s   GBP000s 
-----------------------------------------------------  --------  -------- 
Cash outflow from operating activities                 (10,240)   (7,950) 
-----------------------------------------------------  --------  -------- 
Cash flow from investing activities 
Purchase of intangible assets                          (27,188)  (17,424) 
Purchase of plant and equipment                            (62)   (1,461) 
Repayment of loan to third party                              -       915 
Net cash used in investing activities                  (27,250)  (17,970) 
-----------------------------------------------------  --------  -------- 
Cash flow from financing activities 
Proceeds from loan                                            -    15,748 
Proceeds from issue of shares                            16,758    43,557 
Share issue costs                                         (665)   (2,180) 
Finance (costs)/income                                     (21)   (1,014) 
Net cash generated from financing activities             16,072    56,111 
-----------------------------------------------------  --------  -------- 
Net increase/(decrease) in cash and cash equivalents   (21,418)    30,191 
Cash and cash equivalents at beginning of the year       48,404    17,980 
Effect of foreign exchange rate changes                   (346)       233 
-----------------------------------------------------  --------  -------- 
Cash and cash equivalents at end of the year             26,640    48,404 
-----------------------------------------------------  --------  -------- 
 
 
NOTES TO THE FINANCIAL STATEMENTS 
 
 
1. ACCOUNTING POLICIES 
-------------------------------------------------------------------------------------------------- 
 
BASIS OF PREPARATION 
 
The annual financial statements of Sirius Minerals Plc ("the Company") and its subsidiaries 
 ("the Group") have been prepared in accordance with International Financial Reporting Standards 
 ("IFRS") and IFRS IC Interpretations as adopted by the European Union ("EU") and the Companies 
 Act 2006 applicable to companies reporting under IFRS. 
 
IFRS is subject to amendment and interpretation by the International Accounting Standards 
 Board ("IASB") and the International Financial Reporting Standards Interpretations Committee 
 ("IFRS IC") and there is an ongoing process of review and endorsement by the European Commission. 
 The financial statements have been prepared on the basis of the recognition and measurement 
 principles of IFRS that were applicable at 31 March 2015. 
 
The preparation of financial statements in conformity with IFRS requires the use of certain 
 critical accounting estimates. It also requires management to exercise its judgement in the 
 process of applying the company's accounting policies. The areas involving a higher degree 
 of judgement or complexity, or areas where assumptions and estimates are significant to the 
 financial statements, are disclosed in note 2. 
 
The financial statements have been prepared under the historical cost convention. The principal 
 accounting policies set out below have been consistently applied to all periods presented. 
 
The Company is a public limited company which is incorporated and domiciled in the UK. The 
 address of its registered office is: 3rd Floor Greener House, 68 Haymarket, London SW1Y 4RF. 
 
GOING CONCERN 
 
  The Group incurred a loss for the year after taxation of GBP9,565,000 and as at 31 March 2015, 
  its assets exceeded its liabilities by GBP146,636,000. Whilst the Directors remain confident 
  of a positive outcome in each of the following areas they recognise that there are a number 
  of material uncertainties inherent in the York Potash project, namely; 
 
  --The conclusion of the feasibility studies to prove the availability and economic viability 
  of polyhalite resources 
  -- Securing sufficient financing to fund full operational development 
 
  An unsuccessful outcome in respect of these material uncertainties may cast significant doubt 
  on the Group's ability to continue as a going concern. However the Directors remain positive 
  following recent planning decisions covering the Project's mine and mineral transport system, 
  and the Group's ability to raise finance in the future. The Directors are of the view that 
  additional funding will be secured as necessary. In March 2015, the Group secured a further 
  GBP15m through a placement of shares. 
 
  The Group retains the ability to defer certain expenditure and operate within the level of 
  its existing funds for a period which the Directors believe to be sufficient to enable them 
  to secure funding. On this basis the Directors have concluded that the Group retains sufficient 
  resources to meet its obligations as they fall due for a period of at least 12 months from 
  the date of approval of these financial statements. The financial statements do not include 
  the adjustments which would result if the Group were unable to continue as a going concern. 
 
  2. SEGMENTAL ANALYSIS 
-------------------------------------------------------------------------------------------------- 
 
 
Management has determined the operating segments by considering the business from both a geographic 
 and activity perspective. The Group is currently organised into two business divisions: the 
 UK segment which consists of the York Potash related activities and the corporate operations 
 and the Rest of World which includes the parent company's other overseas interests. These 
 divisions are the segments for which the Group reports information internally to the Board 
 of Directors. The Group's operations are predominantly in the United Kingdom. 
 
 
                                                                                UK     Rest of the World 
                                                 --------------------------------- 
                                                                                     Resource evaluation 
                                                                                     and exploration and 
                                                 Corporate operations and Resource         Environmental 
                                                        Evaluation and exploration             solutions 
 
                                                                                                             Total 
                                                                           GBP000s               GBP000s   GBP000s 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Year ended 31 March 2015 
Operating (loss)/profit                                                   (10,207)                   160  (10,047) 
Finance costs                                                                (353)                     -     (353) 
Finance income                                                                 328                     4       332 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
(Loss)/profit before taxation                                             (10,231)                   163  (10,068) 
Tax credits                                                                    503                     -       503 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
(Loss)/profit for the year from continuing 
 operations                                                                (9,728)                   163   (9,565) 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Total assets                                                               151,340                   366   151,706 
Total liabilities                                                          (4,900)                 (170)   (5,070) 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Net assets                                                                 146,440                   196   146,636 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Capital expenditure                                                         28,990                     -    28,990 
Depreciation and amortization                                                  203                     -       203 
Share based payment cost                                                     2,493                     -     2,493 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
 
 
 
                                                                                UK     Rest of the World 
                                                 --------------------------------- 
                                                                                     Resource evaluation 
                                                                                     and exploration and 
                                                 Corporate operations and Resource         Environmental 
                                                        Evaluation and exploration             solutions 
 
                                                                                                             Total 
                                                                           GBP000s               GBP000s   GBP000s 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Year ended 31 March 2014 
Operating (loss)/profit                                                    (8,948)                 (167)   (9,115) 
Finance costs                                                              (1,063)                     -   (1,063) 
Finance income                                                                  43                     6        49 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
(Loss)/profit before taxation                                              (9,968)                 (161)  (10,129) 
Tax credits                                                                  2,151                     -     2,151 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
 
  (Loss)/profit for the year from continuing 
  operations                                                               (7,817)                 (162)   (7,978) 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Total assets                                                               143,819                   561   144,380 
Total liabilities                                                          (9,326)                 (181)   (9,507) 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Net assets                                                                 134,493                   380   134,873 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
Capital expenditure                                                         20,508                     -    20,508 
Depreciation and amortisation                                                  216                     8       224 
Share based payment cost                                                       564                     -       564 
-----------------------------------------------  ---------------------------------  --------------------  -------- 
 
 
 
3. SUMMARY OF ADMINISTRATIVE EXPENSES 
------------------------------------- 
 
 
The Company made impairment charges in respect of its loans receivable from Auspotash Corporation 
 and Sirius Minerals (Australia) Pty Limited (see notes 13 and 15). The total expense recognised 
 within the income statement in relation to impairment charges is GBP2,898 (2014: GBP23,174). 
4. LOSS PER SHARE 
-------------------------------------------------------------------------------------------------- 
 
Basic loss per share is calculated by dividing the earnings attributable to ordinary 
 shareholders 
 by the weighted average number of ordinary shares outstanding during the year. 
 
 Given the Group's reported loss for the year, share options are not taken into account 
 when 
 determining the weighted average number of ordinary shares in issue during the year and 
 therefore 
 the basic and diluted earnings per share are the same. 
                                                                            2015     2014 
                                                                         GBP000s  GBP000s 
 ----------------------------------------------------------------------  -------  ------- 
 Loss for the purposes of basic earnings per share being net loss 
  attributable to equity shareholders 
  of the parent                                                          (9,565)  (7,978) 
 ----------------------------------------------------------------------  -------  ------- 
 Loss for the purpose of diluted earnings per share                      (9,565)  (7,978) 
 ----------------------------------------------------------------------  -------  ------- 
 
 
                                                                          2015       2014 
                                                                        Number     Number 
                                                                          000s       000s 
 ------------------------------------------------------------------  ---------  --------- 
 Number of shares 
 Weighted average number of ordinary shares for the purpose of 
  basic and diluted earnings per 
  share                                                              1,901,126  1,435,723 
 ------------------------------------------------------------------  ---------  --------- 
 
 If the Company's share options were taken into consideration in respect of the Company's 
 weighted 
 average number of ordinary shares for the purpose of diluted earnings per share, it 
 would 
 be as follows: 
 
                                                                          2015       2014 
                                                                        Number     Number 
                                                                          000s       000s 
 ------------------------------------------------------------------  ---------  --------- 
 Number of shares 
 Weighted average number of ordinary shares for the purposes of 
  diluted earnings per share                                         1,960,057  1,503,154 
 ------------------------------------------------------------------  ---------  --------- 
 Basic and diluted loss per share                                       (0.5)p     (0.5)p 
 ------------------------------------------------------------------  ---------  --------- 
 
 
 
 
 Basic loss per share is calculated by dividing the earnings attributable to ordinary shareholders 
 by the weighted average number of ordinary shares outstanding during the year. 
 
Given the Group's reported loss for the year, share options are not taken into account when 
 determining the weighted average number of ordinary shares in issue during the year, therefore 
 basic and diluted earnings per share are the same. 
 
  5. INTANGIBLE ASSETS 
-------------------------------------------------------------------------------------------------- 
 
 
                                                                    Exploration 
                                                          and Evaluation Assets  Goodwill  Software     Total 
Group                                                                   GBP000s   GBP000s   GBP000s   GBP000s 
--------------------------------------------------------  ---------------------  --------  --------  -------- 
Cost 
At 1 April 2013                                                         125,386     9,079        79   134,544 
Additions                                                                19,097         -         -    19,097 
Foreign exchange movement                                                     -         -         -         - 
At 31 March 2014                                                        144,483     9,079        79   153,641 
Additions                                                                28,929         -         -    28,929 
Foreign exchange movement                                                     -         -         -         - 
As at 31 March 2015                                                     173,412     9,079        79   182,570 
--------------------------------------------------------  ---------------------  --------  --------  -------- 
 
Accumulated provision for permanent diminution in value 
At 1 April 2013                                                        (58,339)   (2,436)      (26)  (60,801) 
Impairment                                                                    -         -         -         - 
Amortisation                                                                  -         -      (26)      (26) 
At 31 March 2014                                                       (58,339)   (2,436)      (52)  (60,827) 
Amortisation                                                                  -         -      (22)      (22) 
--------------------------------------------------------  ---------------------  --------  --------  -------- 
At 31 March 2015                                                       (58,339)   (2,436)      (74)  (60,849) 
--------------------------------------------------------  ---------------------  --------  --------  -------- 
Net book value 
31 March 2015                                                           115,073     6,643         5   121,721 
--------------------------------------------------------  ---------------------  --------  --------  -------- 
31 March 2014                                                            86,144     6,643        27    92,814 
--------------------------------------------------------  ---------------------  --------  --------  -------- 
 
 
GOODWILL 
 
The goodwill acquired in January 2011 as part of the business combination relating to York 
 Potash Ltd has been allocated to the cash generating unit (CGU) of resource evaluation and 
 exploitation in the geographical location of the UK, which is expected to benefit from the 
 business combination. 
 
The recoverable amount of the goodwill on the acquisition of York Potash Ltd has been assessed 
 by reference to value in use. The valuation is based on cash flow projections that incorporate 
 best estimates of selling prices, production rates, future capital expenditure and production 
 costs. A growth rate of 2 per cent was incorporated into the discount rate. 
 
The cash flow projections are based on long term plans covering the expected life of the operation. 
 The Indicated Resource of 820 million tonnes of polyhalite determines an expected mine life 
 of more than 25 years. The valuations are particularly sensitive to changes in assumptions 
 about selling prices, volumes of production and operating costs. Long term average selling 
 prices are forecast taking account of market data in respect of potash and management's current 
 expectations. Forecasts of volumes of production and operating costs are based on management's 
 current expectations. 
 
Discount rates represent an estimate of the rate the market would apply having regard to the 
 time value of money and the risks specific to the asset for which the future cash flow estimates 
 have not been adjusted. A discount rate of 10 per cent, which is considered to be appropriate 
 for a project of this nature and size, has been applied to the pre-tax cash flows. 
 
No reasonably possible change in the key assumptions on which York Potash Ltd's recoverable 
 amount is based would cause its value to fall short of its carrying amount as at 31 March 
 2015. 
 
IMPAIRMENT 
There were no impairment charges in the year. Last year there were impairment charges of GBP4,000. 
6. CASH OUTFLOW FROM OPERATING ACTIVITIES 
----------------------------------------------------------------------------------------------------- 
 
 
                                                            2015      2014 
Group                                                    GBP000s   GBP000s 
------------------------------------------------------  --------  -------- 
Loss before tax                                         (10,068)  (10,129) 
Depreciation                                                 182       198 
Assets expensed to income statement                           64        50 
Finance (income)/expense                                      21     1,014 
Amortisation                                                  22        26 
Impairment                                                     -         - 
Share based payments                                       1,886     1,086 
Loan conversion into shares                                  333       531 
Tax credit                                                   503     1,492 
Operating cash flow before changes in working capital    (7,057)   (5,732) 
Decrease/(increase) in receivables                         (367)      (88) 
(Decrease)/increase in payables                          (2,816)   (2,130) 
------------------------------------------------------  --------  -------- 
Net cash outflow from operating activities              (10,240)   (7,950) 
------------------------------------------------------  --------  -------- 
 
 
7. SHARE CAPITAL 
                                                                       2015     2014 
                                                                    GBP000s  GBP000s 
------------------------------------------------------------------  -------  ------- 
 
Allotted and called up 
2,145,020,261 (2014: 1,863,331,072) ordinary shares of 0.25p each     5,362    4,658 
------------------------------------------------------------------  -------  ------- 
 
 
On 9 April 2014 the Company issued 1,198,095 new ordinary shares of 0.25p each to Company 
 employees under the Company's long term incentive plan. 
 On 2 June 2014 the Company issued 900,000 new ordinary shares of 0.25p each to Jason Murray, 
 Executive Director pursuant to share awards under his contract of employment which had vested. 
 On 4 August 2014 the company cancelled 25,000 new ordinary shares of 0.25p each 
 On 20 August 2014 the Company issued 1,044,445 new ordinary shares of 0.25p each to Jason 
 Murray, Executive Director upon leaving the company pursuant to share awards which had vested. 
 On 20 August 2014 the Company issued 250,000 new ordinary shares of 0.25p each at a price 
 of 4.5p per share, realising GBP10,625, following the exercise of share options. 
 On 12 September 2014 the Company issued 500,000 new ordinary shares of 0.25p each at a price 
 of 4.5p per share, realising GBP21,250, following the exercise of share options. 
 On 24 March 2015 the Company issued 6,200,000 new ordinary shares of 0.25p each at a price 
 of 4.5p per share, realising GBP263,500, following the exercise of share options. 
 On 23 March 2015 the Company issued 500,000 new ordinary shares of 0.25p each at a price of 
 4p per share, realising GBP18,750, following the exercise of share options. 
 Throughout the year, pursuant to notices served by the Company's investor under the convertible 
 securities facility entered into on 11 August 2013 the Company issued the following new ordinary 
 shares of 0.25p each:                 Number of        Weighted 
   Issue Price       shares   Average Price 
 -------------  -----------  -------------- 
        At 5 - 
       8 pence   16,085,268            6.5p 
 -------------  -----------  -------------- 
        8 - 10 
         pence   28,611,849            9.3p 
 -------------  -----------  -------------- 
       10 - 12 
         pence      446,429           11.1p 
 -------------  -----------  -------------- 
         Total   45,143,546            8.3p 
 -------------  -----------  -------------- 
 
 
 On 9 March 2015 the Company issued 225,978,103 new ordinary shares of 0.25p each to various 
 parties in connection with a placing at a price of 7p per ordinary share. 
8. FINANCIAL INFORMATION 
------------------------------------------------------------------------------------------------- 
 
 

The financial information set out in this announcement does not comprise the Group's statutory accounts for the years ended 31 March 2015 or 31 March 2014.

The comparative financial information has been extracted from the statutory accounts of the Group for the year ended 31 March 2014. The auditors reported on those accounts; their report was unqualified and did not contain a statement under either Section 498 (2) or Section 498 (3) of the Companies Act 2006 and but did include references to material uncertainties surrounding the Directors application of the Going Concern assumption. The statutory accounts for the year ended 31 March 2014 have been delivered to the Registrar of Companies.

The statutory accounts for the year ended 31 March 2015 have been finalised on the basis of the financial information presented by the Directors in this preliminary announcement and will be delivered to the Registrar of Companies following the Company's Annual General Meeting.

ENDS

This information is provided by RNS

The company news service from the London Stock Exchange

END

FR EAEXNADDSEAF

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