TIDMNUOG
RNS Number : 1230I
Nu-Oil and Gas PLC
31 March 2020
31 March 2020
Nu-Oil and Gas plc
("Nu-Oil" or "the Company")
Unaudited Interim Results
Nu-Oil and Gas plc (AIM: NUOG), the AIM Rule 15 cash shell,
reports its half year results for the six months ended 31(st)
December 2019.
Reporting Period:
-- Nu-Oil announced several measures intended to prevent the
Company from going into administration on 2(nd) October 2019. The
measures were subsequently approved by shareholders on 4(th)
November 2019, giving effect to the following outcomes:
- Restructuring of the Board of Directors which now consists of
Mr Jay Bhattacherjee as Non-Executive Chairman and Mr Andrew Dennan
and Mr Frank Jackson as Non-Executive Directors
- Sale of the Company's 50% interest in Marginal Field
Development Company Limited (MFDevCo) to the RMRI group (the
related party, including its principals, ('RMRI Group')), which
held the remaining 50% interest in MFDevCo) in consideration for
the settlement of all outstanding related party amounts owed
- Company designated as an AIM Rule 15 cash shell
- Raise of GBP500,000 (gross proceeds) via an issue of new ordinary shares
-- The Company's largest third-party debt was refinanced through
the issue of GBP2.5 million of new Loan Notes to C4 Energy Ltd in
place of the existing debt owing. The Loan Notes issued are
unsecured, interest-free and have a five-year term, with repayment
due at the end of term and a right to exercise conversion at any
time
-- On 21(st) October 2019, the Company announced it had returned
the equity held in Enegi Oil Inc. ('Enegi') to Enegi with immediate
effect
Post period end:
-- The Company raised a further GBP420,000 (gross proceeds) via an issue of new ordinary shares
-- The Company announced on 17 March 2020 that its focus going
forward will be on environmental industries and since then has made
good progress in evaluating potential targets in this sector.
Further updates to Shareholders regarding further progress will be
provided as and when appropriate
Enquiries
Nu-Oil and Gas plc Tel: +44 (0)20 3411 8737
Jay Bhattacherjee
Strand Hanson Limited Tel: +44 (0)20 7409 3494
Rory Murphy/Ritchie Balmer/Jack
Botros
Novum Securities Limited Tel: +44 (0)20 7399 9425
Jon Belliss
Yellow Jersey PR
Georgia Colkin/Annabel Atkins Tel: +44 (0)7825 916 715
Chairman's Statement
As announced on 4(th) November 2019, I became Chairman of Nu-Oil
and Gas with a mandate to transform the Company structurally and
financially in order to grow the value of the business. Given
Nu-Oil's designated status as a cash shell, an acquisition will
constitute a reverse takeover under the AIM Rules. The Company has,
in recent weeks and months, particularly focused its efforts on the
environmental industries sector and has made good progress in
evaluating potential targets. The Company is confident in its
ability to close a reverse takeover transaction in this particular
sector and believes that it would provide an opportunity for
diversification of risk away from the hydrocarbons sector which
continues to be severely depressed. In addition to pursuing an
acquisition, we continue to address and resolve many of the legacy
issues carried over prior to the Company's restructuring.
At the start of the financial year, the Company had a cash
balance of GBP58,000 with liabilities significantly more than the
Company had resource to resolve at that time in the event they were
called. During the six months which followed, the Company has
implemented several vital and structural changes, notably:
Restructuring and refinancing of corporate debt
Prior to the Company's restructuring, announced 2(nd) October
2019, it was apparent that the Company's debt and liability
position was not sustainable given the historic corporate
performance. The restructuring and refinancing of the principal
third-party debt by C4 Energy Limited (following the earlier
acquisition of that debt from Shard Capital Management Limited) and
the settling of liabilities owed to the RMRI group were essential
to avoid the Company going into administration.
Divestment of MFDevCo
In settling amounts owed to the RMRI group, the Board recognised
that, despite the Company's investment to date, MFDevCo had failed
to generate any sustainable shareholder value and, in addition, was
unlikely to do so in the near-term despite the cost burden to
Nu-Oil. Consequently, the Company disposed of its interest in
MFDevCo to the co-owner, RMRI, with the parties agreeing that net
amounts owed by Nu-Oil to the RMRI group would constitute the
consideration. With the divestment of MFDevCo, the Company was
designated a cash shell and thereby ended its relationship with
RMRI.
Returning of equity in Enegi Oil Inc.
As announced on 21(st) October 2019, the equity interest in
Enegi, the Canadian subsidiary in which the Western Newfoundland
oil and gas licenses were held, was returned. This was an important
step in cleaning up the Company and in redirecting the value
opportunity for shareholders.
Funding
In the six months to 31(st) December 2019 and following the
passing of the resolutions at the General Meeting on 4(th) November
2019, the Company raised gross proceeds of GBP500,000 through the
issue of new ordinary shares. These proceeds have been used to
settle several legacy liabilities and for working capital
purposes.
In addition to the November fundraise and subsequent to the
reporting date of these accounts, the Company raised a further
GBP420,000 gross proceeds in January 2020, both to strengthen the
Company's balance sheet and provide the necessary working capital
during this cash shell phase.
AIM Rule 15 Cash Shell
Following the passing of the resolutions at the November General
Meeting, the sale of the Company's 50% interest in MFDevCo became
effective. As a result, the Company was designated an AIM Rule 15
cash shell. In practical terms, this means that the next
transaction the Company secures will constitute a reverse takeover
under the AIM Rules. The Company has until 4(th) May 2020 to
announce such a transaction following which its shares will be
suspended from trading on AIM pursuant to AIM Rule 40. The Company
will then have a further six months to negotiate and undertake a
reverse takeover acquisition before its shares would be cancelled
from trading on AIM.
In light of the uncertainty triggered by the Covid-19 pandemic,
the Stock Exchange has acknowledged and confirmed further time may
be granted to companies to resolve the reason for suspension.
Accordingly, the Stock Exchange will use its discretion to extend
the period to 12 months for any AIM company that has been suspended
between 30(th) September 2019 and 1(st) July 2020.
Summary
The Company remains in a critical phase of its turnaround and
recovery and shareholders should be aware that, whilst the Company
is confident in its ability to announce a reverse takeover
transaction within the timeframe, there can be no guarantee of such
occurring.
Finally, on behalf of the Board, we would like to thank all our
shareholders for their patience and continued support at this
time.
__________________________
Jay Bhattacherjee
Non-Executive Chairman
31 March 2020
CONSOLIDATED INCOME STATEMENT
For the 6 months ended 31 December 2019
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31 Dec 31 Dec 30 Jun
GBP '000 Note 19 18 19
----------------------------------- ----- ---------- ---------- -----------
Revenue - - -
Cost of sales - - -
----------------------------------- ----- ---------- ---------- -----------
Gross Profit - - -
----------------------------------- ----- ---------- ---------- -----------
Administrative expenses (113) (884) (2,011)
----------------------------------- ----- ---------- ---------- -----------
Loss from operations (113) (884) (2,011)
----------------------------------- ----- ---------- ---------- -----------
Finance costs (130) (88) (788)
-----------
Loss before tax (243) (972) (2,799)
----------------------------------- ----- ---------- ---------- -----------
Taxation - - -
----------------------------------- ----- ---------- ---------- -----------
Loss for the period (243) (972) (2,799)
----------------------------------- ----- ---------- ---------- -----------
Loss attributable to discontinued
operations - (137) (101)
Loss attributable to continuing
operations (243) (835) (2,698)
----------------------------------- ----- ---------- ---------- -----------
Loss for the period (243) (972) (2,299)
----------------------------------- ----- ---------- ---------- -----------
Loss per share (expressed in
pence per share)
Basic 2 (0.01p) (0.07p) (0.2p)
Diluted 2 (0.01p) (0.07p) (0.2p)
----------------------------------- ----- ---------- ---------- -----------
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the 6 months ended 31 December 2019
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31 Dec 31 Dec 30 Jun
GBP '000 Note 19 18 19
---------------------------------- ------ ---------- ---------- -----------
Loss for the year (243) (972) (2,799)
Other comprehensive expense:
Currency translation differences 11 1 6
Other comprehensive income for
the year, net of tax 11 1 6
------------------------------------------ ---------- ---------- -----------
Total comprehensive expense
for the year (232) (971) (2,793)
------------------------------------------ ---------- ---------- -----------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
as at as at as at
31 Dec 31 Dec 30 June
GBP '000 Note 19 18 19
Non-current assets
Tangible fixed assets 5 173 8
Intangible assets - 666 -
Other long-term assets - 479 500
----------------------------- ----- ---------- ---------- ---------
5 1,318 508
----------------------------- ----- ---------- ---------- ---------
Current assets
Trade and other receivables 3 55 887 1,165
Cash and cash equivalents 236 211 58
291 1,098 1,223
----------------------------- ----- ---------- ---------- ---------
Total assets 296 2,416 1,731
Current liabilities
Loans 5 (2,682) (1,880) (2,562)
Trade and other payables 4 (765) (1,569) (1,440)
Due to related parties - (520) (657)
----------------------------- ----- ---------- ---------- ---------
(3,447) (3,969) (4,659)
----------------------------- ----- ---------- ---------- ---------
Non-current liabilities
Provisions - (471) (491)
----------------------------- ----- ---------- ---------- ---------
Total liabilities (3,447) (4,440) (5,150)
----------------------------- ----- ---------- ---------- ---------
Net liabilities (3,151) (2,024) (3,419)
----------------------------- ----- ---------- ---------- ---------
Shareholders' equity
Ordinary share capital 3,217 3,072 3,207
Share premium account 31,849 31,062 31,359
Reverse acquisition reserve - 9,364 9,364
Warrant reserve 404 409 404
Other reserves (2,487) (2,487) (2,487)
Accumulated losses (36,134) (43,444) (45,266)
----------------------------- ----- ---------- ---------- ---------
Total equity (3,151) (2,024) (3,419)
----------------------------- ----- ---------- ---------- ---------
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Ordinary Share Reverse Warrant
Share Premium Acquisition and Other Accumulated Total
GBP'000 Capital Account Reserve Reserves Losses Equity
-------------------------- --------- --------- ------------- ----------- ------------ --------
Balance, 1(st) July
2018 3,072 31,062 9,364 (2,078) (42,473) (1,053)
Loss for the period - - - - (972) (972)
Currency translation
differences - - - - 1 1
-------------------------- --------- --------- ------------- ----------- ------------ --------
Comprehensive loss - - - - (971) (971)
Equity fundraise - - - - - -
Effect of warrants - - - - - -
-------------------------- --------- --------- ------------- ----------- ------------ --------
Transactions with - - - - - -
owners
Balance, 31(st) December
2018 3,072 31,062 9,364 (2,078) (43,444) (2,024)
Loss for the period - - - - (1,827) (1,827)
Currency translation
differences - - - - 5 5
-------------------------- --------- --------- ------------- ----------- ------------ --------
Comprehensive loss - - - - (1,822) (1,822)
Equity fundraise 135 297 - - - 432
Effect of warrants - - - (5) - (5)
-------------------------- --------- --------- ------------- ----------- ------------ --------
Transactions with
owners 135 297 - (5) - 427
Balance, 30(th) June
2019 3,207 31,359 9,364 (2,083) (45,266) (3,419)
Loss for the period - - - - (243) (243)
Currency translation
differences - - - - 11 11
-------------------------- --------- --------- ------------- ----------- ------------ --------
Comprehensive loss - - - - (232) (232)
Equity fundraise 10 490 - - - 500
Release of reverse
acq. reserve - - (9,364) - 9,364 -
-------------------------- --------- --------- ------------- ----------- ------------ --------
Transactions with
owners 10 490 (9,364) - 9,364 500
Balance, 31(st) December
2019 3,217 31,849 - (2,083) (36,134) (3,151)
-------------------------- --------- --------- ------------- ----------- ------------ --------
CONSOLIDATED STATEMENT OF CASH FLOW
For the 6 months ended 31(st) December 2018 and 31(st) December
2019 and for the year ended 30(th) June 2019
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31 Dec 31 Dec 30 Jun
GBP '000 Note 19 18 19
--------------------------------------- ------ ---------- ---------- -----------
Cash flows from operating activities
Cash used in operations (312) (612) (1,130)
Net cash used in operating activities (312) (612) (1,130)
----------------------------------------------- ---------- ---------- -----------
Cash flows from financing activities
Share capital issued for cash 500 - 380
Loan repayments (10) (38) (53)
----------------------------------------------- ---------- ---------- -----------
Net cash from financing activities 490 (38) 327
----------------------------------------------- ---------- ---------- -----------
Net increase / (decrease) in cash
and cash equivalents 178 (650) (803)
Cash and cash equivalents at the
start of the period 58 861 861
Cash and cash equivalents at the
end of the period 236 211 58
----------------------------------------------- ---------- ---------- -----------
NOTES TO THE INTERIM RESULTS
1. Basis of Preparation
Corporate Information
Nu-Oil and Gas plc (the 'Company' and together with its
subsidiaries, the 'Group') is a company incorporated in England on
13 September 2007 and has registered address of Audley House, 13
Palace Street, London, SW1E 5HX. The Group is domiciled in the UK
for tax purposes and its shares are quoted on the Alternative
Investment Market ('AIM') of the London Stock Exchange.
Accounting policies
The accounting policies adopted here are consistent with those
of the previous financial periods.
These financial statements do not constitute statutory accounts
as defined in Section 434 of the Companies Act 2006. The
consolidated financial statements of the Group have been prepared
in accordance with International Financial Reporting Standards as
adopted by the European Union (IFRSs as adopted by the EU), the
Companies Act 2006 that applies to companies reporting under IFRS
and IFRS-IC interpretations. The consolidated financial statements
have been prepared under the historical cost convention. 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 Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where
assumptions and estimates are significant to the consolidated
financial statements are consistent with those highlighted in the
Group's annual report and accounts, most recently published on
23(rd) December 2019.
New and amending Accounting standards
In the period ended 31(st) December 2019, the Directors have
reviewed all the new and revised Standards. It has been determined
by the Directors that there is no impact, material or otherwise, of
the new and revised Standards and Interpretations on the Group's
business and, therefore, no change is necessary to the Group's
accounting policies.
2. Loss per Share
Loss per share amounts are calculated by dividing the loss for
the year by the weighted average number of common shares in issue
during the year.
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
31 Dec 31 Dec 30 Jun
19 18 19
----------------------------------- -------------- -------------- --------------
Loss attributable to shareholders
of the Company (GBP'000) (243) (972) (2,799)
Weighted average number of shares
in issue 1,830,972,927 1,364,027,131 1,393,255,721
Fully diluted weighted average
number of shares in issue 1,830,972,927 1,364,027,131 1,393,255,721
----------------------------------- -------------- -------------- --------------
Basic loss per share (expressed
in pence per share) (0.01p) (0.07p) (0.2p)
Diluted loss per share (expressed
in pence per share) (0.01p) (0.07p) (0.2p)
----------------------------------- -------------- -------------- --------------
3. Trade and Other Receivables
Unaudited as Unaudited as Audited as
at at at
GBP '000 31 Dec 19 31 Dec 18 30 June 19
------------------------ ------------- ------------- ------------
Sales taxes receivable 41 145 -
Prepayments and other
receivables 14 742 1,165
55 887 1,165
------------------------ ------------- ------------- ------------
The Group's other receivables at 30(th) June 2019 related to
services provided to MFDevCo as part of its marginal field
strategy. These amounts settled by way of offset against amounts
owed to RMRI as a part of the reorganisation announced in October
2019. As a part of that reorganisation, the Group has no
obligations to contribute to any excess losses or creditors that
reside within MFDevCo. As a result, the impairment provision in
2018 was reversed at the end of the last financial year and
released in the current period.
4. Trade and Other Payables
Unaudited as Unaudited as Audited as
at at at
GBP '000 31 Dec 19 31 Dec 18 30 June 19
------------------------------ ------------- ------------- ------------
Trade payables 419 474 512
Accruals 276 990 752
Taxation and social security 8 98 115
Other payables 62 7 61
765 1,569 1,440
------------------------------ ------------- ------------- ------------
Included within accruals at 30(th) June 2019 was a balance of
GBP556,000 which relates to the related party RMRI group. This
accrual was owed in addition to the related party balance of
GBP657,000 also at 30(th) June 2019. These balances have been
settled as a result of the restructuring which was approved by
shareholders on 4(th) November 2019.
The accrual owing to the RMRI group was included in Group's
accruals as an Application for Payment. Applications for Payment
are used where there is uncertainty with respect to timing of
payment to avoid generating a VAT liability for the service
provider until payment is made.
5. Loans
YA Global Shard C4 Total
------------------------------ --------- ------- -------- -------
Balance 1 July 2018 (183) (1,643) - (1,826)
Repayments - - -
Movement in accrued interest (7) (46) - (53)
------------------------------ --------- ------- -------- -------
Balance 31 December 2018 (190) (1,689) - (1,879)
Repayments 15 38 - 53
Movement in accrued interest (6) (730) - (736)
------------------------------ --------- ------- -------- -------
Balance 30 June 2019 (181) (2,381) - (2,562)
Repayments 10 - - 10
Movement in accrued interest (11) (119) - (130)
Refinancing - 2,500 (2,500) -
Balance 31 December 2019 (182) - (2,500) (2,682)
------------------------------ --------- ------- -------- -------
On 25(th) November 2013, the Company initially obtained a loan
of GBP1,000,000 from Shard Capital Management Limited ('Shard').
Under the terms of the loan, which had a duration of 12 months, the
Company was due to pay interest totalling GBP200,000. In December
2014, the Company obtained a further loan from Shard of GBP200,000.
Under the terms agreed, the Company was due to then pay a further
GBP120,000 interest on the original loan of GBP1,000,000 from
November 2013 and GBP20,000 on the additional loan of GBP200,000
for a total interest expense in 2015 of GBP140,000. Under the terms
of the Shard loans, which have expired, Shard was granted security
over PL2002-01(A) in Newfoundland and the Company had a right to
convert the debt to equity.
The Company continued to accrue interest on the Shard loans on a
simple interest basis and, at 30 June 2018, the carrying amount of
the loan was GBP1.643 million. For the period ended 30 June 2019,
the interest accrued was based on the amount agreed after the end
of the year resulting in interest expense for the year of
GBP776,000.
Following 30(th) June 2019 year end, the Company was informed by
Shard Capital Management Limited ('Shard') that it had sold the
loan to C4 Energy Ltd ('C4'), a UK incorporated private company.
Non-Executive Chairman Jay Bhattacherjee and Non-Executive Director
Andy Dennan are shareholders of C4. Following the sale of the debt,
the Company granted C4 loan notes to the value of GBP2,500,000 in
GBP10,000 denominations. The Loan Notes are unsecured, interest
free and have a five-year term, with repayment due at the end of
term. In addition, the loan notes have conversion rights at any
time at a price of 0.05 pence per ordinary share, although they
contain a restriction preventing conversion of such amount that
would result in C4 holding more than 29.9% of the Company's issued
share capital from time to time.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR SDAFMSESSELD
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