TIDMORCP
RNS Number : 7534J
Oracle Coalfields PLC
14 September 2016
Interim Results
Oracle Coalfields PLC
14 September 2016
ORACLE COALFIELDS PLC
("Oracle" or the "Company" or the "Group")
UNAUDITED INTERIM RESULTS FOR THE 6 MONTHS TO 30 JUNE 2016
Oracle Coalfields PLC (AIM:ORCP), the UK energy developer of a
combined lignite coal mine and mine mouth power plant located in
the Thar desert in the south-eastern Sindh Province of Pakistan,
today announces its unaudited interim results for the six months
ended 30 June 2016.
Highlights
-- Notification by the Energy Department, Government of Sindh
for the extension of the applicability of US$ based 20% internal
rate of return to all coal mining projects based on indigenous Thar
coal to the companies which achieve financial close before 31
December 2016.
-- Determination by the Thar Coal and Energy Board following a
coal price petition, based on feasibility studies, of a coal price
of US$60.23/tonne.
-- The signing of a Shareholder Framework Agreement, subject to
conditions precedent, whereby a consortium of new and existing
Chinese partners will take 70% equity in the Company's subsidiaries
in Pakistan, in order to advance the development of the
project.
Shahrukh Khan, CEO of Oracle, said,
"The power shortage in Pakistan remains acute and the Government
remains steadfast in its objective of dealing with the country's
energy crisis. The Government continues to support the Company in
the development of the coal mine and power project.
"Following the signing of the Shareholder Framework Agreement,
we, with our Chinese partners, are currently in the process of
agreeing a Shareholder Agreement and details of EPC contracts for
both the mine and the power plant."
CHAIRMAN'S STATEMENT FOR THE 6 MONTHS TO 30 JUNE 2016
Chairman's Statement
I am pleased to present the Company's results for the six months
ended 30 June 2016.
Operational Update and Looking Ahead
We continue to make progress towards bringing the Thar coalfield
Block VI power project to a financial close The power shortage in
Pakistan continues and it is clear that development of Thar is the
substantive medium-term solution.
The Governments, federal and provincial, have put in place
fiscal incentives and also a "cost-plus" arrangement under which
holders of mining leases in the Thar desert are allowed a coal
price and electricity tariff that give developers a project based
internal rate of return ("IRR") of 20%, in US dollar terms. The
Thar Coal and Energy Board has now made an initial determination of
our coal price according to the Rules promulgated in 2014. This
determination, based on our mine feasibility study, was at a coal
price of US$60.23/tonne. To ensure that the IRR is maintained at
20% throughout the life of the project, the Rules allow for further
coal price petitions at contract stage, financial close, commercial
operations date and periodically thereafter through the lifetime of
the project, to reflect actual costs.
The electricity tariff is similarly determined. Our power plant
project is registered with the Private Power and Infrastructure
Board, Ministry of Water and Power Government of Pakistan and we
shall be submitting our initial electricity tariff petition shortly
to the National Electric Power Regulatory Authority. We shall then
open discussions with the National Transmission and Despatch
Company ("NTDC"), who operate the National Grid, to conclude a
Power Purchase Agreement ("PPA") and an Implementation Agreement
with the Government of Pakistan which, inter alia, will guarantee
payment for power delivery under the PPA.
In addition to the various Government incentives, the China
Pakistan Economic Corridor has been set up with the aim of Chinese
banks providing finance along with Chinese governmental support in
approved energy and infrastructure projects. We understand the
total financing to be made available is in the order of US$46
billion across a number of projects; our Thar Block VI project is
included on the list of approved projects. This will assist in
expediting both Pakistani and Chinese Government approvals that are
required for our project.
The Environmental and Social Impact Assessment for the mine was
approved in 2013 and for the power plant, it is near to completion.
Preparation of resettlement of project affected people has been
initiated; and the land ownership survey is underway, in accordance
with the Government of Sindh Resettlement Policy Framework issued
in 2015.
NTDC are responsible for the construction and operation of high
voltage transmission lines to link Thar power plants with the
National Grid; approximately 80 kilometres are required to make the
connection. NTDC is expected to complete this transmission link
within schedule.
The power plant will require water for its operation and the
mine will have a surplus of water from its dewatering operations.
The Government of Sindh, Energy Department, are responsible for the
provision of water, where there is a shortage, and also for the
evacuation of any surplus. The construction of a fresh water supply
from the River Indus is in progress.
We signed a Shareholders Framework Agreement subject to
conditions precedent, with new and existing Chinese partners in
June 2016. Under this Agreement, it is proposed that the Chinese
partners will take a 70% equity interest in the project and will
act as Engineering, Procurement and Construction (EPC) contractors
for the mine and the power plant. We are now working towards
finalising a Shareholder Agreement and details of EPC contracts for
both the mine and the power plant. Our Chinese partners are taking
the lead in discussions on debt financing with Sinosure, the
Chinese Export and Credit Insurance Corporation.
Summary of Results
As expected for a mining company at our stage of development,
our financial results for the six months to 30 June 2016 show an
operational loss for the Oracle Coalfields PLC Group of Companies
after taxation of GBP448,139 (2015: loss of GBP528,476). At the
period end, the Group had cash and cash equivalents of GBP1,098,594
(2015: GBP1,469,573) and net assets of GBP6,009,371 (2015:
GBP6,706,723). The basic loss per share was 0.05p (2015: loss
0.07p).
Broader Outlook
Inevitably projects of this nature take time to bring to
fruition. The development of Thar is a significant and sustainable
element in Pakistan's longer term solution to the country's present
energy crisis; speedy implementation is in the national
interest.
The Board extends its appreciation to the Thar Coal Energy
Board, the Energy Department, the Coal Mines Department and
Government of Sindh, as well as the Ministry of Water and Power
(Government of Pakistan) for their continued support. The Board
also continues to be very grateful for the patience and support of
our shareholders.
Anthony Scutt
Chairman of the Board - Oracle Coalfields PLC
Date: 13 September 2016
CONSOLIDATED INCOME STATEMENT
FOR THE 6 MONTHSED 30 JUNE 2016
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to Year ended
30 June 2016 30 June 2015 31 Dec 2015
GBP GBP GBP
CONTINUING OPERATIONS
Revenue - - -
Other operating income - 768 768
Administrative expenses (452,710) (531,781) (980,819)
OPERATING LOSS (452,710) (531,013) (980,051)
Finance costs - - -
Finance income 4,571 2,537 7,275
LOSS BEFORE TAX (448,139) (528,476) (972,776)
Tax - - -
LOSS FOR THE PERIOD (448,139) (528,476) (972,776)
Loss attributable to:
Owners of the parent (447,972) (528,476) (972,190)
Non-controlling interests (167) - (586)
(448,139) (528,476) (972,776)
Loss per share attributable to the ordinary equity
holders of the parent:
Basic and diluted (pence) (0.05) (0.07) (0.12)
STATEMENT OF COMPREHENSIVE INCOME
FOR THE 6 MONTHSED 30 JUNE 2016
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to Year ended
30 June 2016 30 June 2015 31 Dec 2015
GBP GBP GBP
LOSS FOR THE PERIOD (448,139) (528,476) (972,776)
OTHER COMPREHENSIVE INCOME
Item that may be reclassified subsequently
to profit or loss:
Exchange difference arising on translation of foreign
operations 157,012 (23,503) 11,572
Income tax relating to components of other
comprehensive income - - -
OTHER COMPREHENSIVE INCOME/(LOSS)
FOR THE PERIOD, NET OF INCOME TAX 157,012 (23,503) 11,572
TOTAL COMPREHENSIVE LOSS
FOR THE PERIOD (291,127) (551,979) (961,204)
Total comprehensive income attributable to:
Owners of the parent (305,283) (551,979) (960,618)
Non-controlling interests 14,156 - (586)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2016
(Unaudited) (Unaudited) (Audited)
As at As at As at
30 June 2016 30 June 2015 31 Dec 2015
Notes GBP GBP GBP
ASSETS
NON-CURRENT ASSETS
Intangible assets 4,476,908 3,960,131 4,170,073
Property, plant and equipment 24,640 1,688 23,532
Loans and other financial instruments 3 377,266 - 338,676
4,878,814 3,961,819 4,532,281
CURRENT ASSETS
Trade and other receivables 114,342 1,020,411 87,604
Cash and cash equivalents 1,098,594 1,469,573 1,860,662
Restricted bank deposits 3 - 360,000 -
1,212,936 2,849,984 1,948,266
TOTAL ASSETS 6,091,750 6,811,803 6,480,547
EQUITY
SHAREHOLDERS' EQUITY
Share capital 4 911,783 911,783 911,783
Share premium 10,900,723 10,897,723 10,900,723
Share scheme reserve 120,194 149,782 149,782
Translation reserve 24,079 (163,167) (132,534)
Accumulated losses (5,960,348) (5,095,127) (5,534,399)
5,996,431 6,700,994 6,295,355
Non-controlling interest 12,940 5,729 5,143
TOTAL EQUITY 6,009,371 6,706,723 6,300,498
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 82,379 105,080 180,049
TOTAL LIABILITIES 82,379 105,080 180,049
TOTAL EQUITY AND LIABILITIES 6,091,750 6,811,803 6,480,547
CONSOLIDATED UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE 6 MONTHSED 30 JUNE 2016
Share
Share Accumulated Share scheme
capital losses premium reserve
GBP GBP GBP GBP
Balance at 31 December 2014 389,009 (4,562,209) 8,346,733
63,070
Changes in equity
Issue of share capital 522,774 - 2,875,255 -
Costs associated with share issue - - (324,265) 86,712
Loss for the period - (528,476) - -
Other comprehensive income - (4,442) - -
Balance at 30 June 2015 911,783 (5,095,127) 10,897,723
149,782
Changes in equity
Issue of share capital - - - -
Costs associated with share issue - - 3,000 -
Loss for the period - (443,714) - -
Other comprehensive income - 4,442 - -
Balance at 31 December 2015 911,783 (5,534,399) 10,900,723
149,782
Changes in equity
Release of charge for lapsed options - 29,588 - (29,588)
Further investment in subsidiary - (7,565) - -
Loss for the period - (447,972) - -
Other comprehensive income - - - -
Balance at 30 June 2016 911,783 (5,960,348) 10,900,723
120,194
Translation Non-controlling Total
reserve Total interest equity
GBP GBP GBP GBP
Balance at 31 December 2014 (144,106) 4,092,497 5,729
4,098,226
Changes in equity
Issue of share capital - 3,398,029 - 3,398,029
Costs associated with share issue - (237,553) - (237,553)
Loss for the period - (528,476) - (528,476)
Other comprehensive income (19,061) (23,503) - (23,503)
Balance at 30 June 2015 (163,167) 6,700,994 5,729 6,706,723
Changes in equity
Issue of share capital - - - -
Costs associated with share issue - 3,000 - 3,000
Loss for the period - (443,714) (586) (444,300)
Other comprehensive income 30,633 35,075 - 35,075
Balance at 31 December 2015 (132,534) 6,295,355 5,143
6,300,498
Changes in equity
Release of charge for lapsed options - - - -
Further investment in subsidiary 13,924 6,359 (6,359) -
Loss for the period - (447,972) (167) (448,139)
Other comprehensive income 142,689 142,689 14,323 157,012
Balance at 30 June 2016 24,079 5,996,431 12,940 6,009,371
CONSOLIDATED CASHFLOW STATEMENT
FOR THE 6 MONTHSED 30 JUNE 2016
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to Year ended
30 June 2016 30 June 2015 31 Dec 2015
Notes GBP GBP GBP
Cash flows from operating activities
Cash generated from operations 1 (614,822) (590,188)
(958,952)
Net cash used in operating activities (614,822) (590,188) (958,952)
Cash flows from investing activities
Purchase of intangible fixed assets (155,004) (175,869) (351,000)
Purchase of tangible fixed assets (1,158) (948) (22,975)
Cash placed on restricted deposit - (360,000) (332,116)
Interest received 4,571 2,537 7,275
Net cash used in investing activities (151,591) (534,280) (698,816)
Cash flows from financing activities
Share issue - 2,449,109 3,369,500
Cost of share issue - (237,553) (234,553)
Net cash from financing activities - 2,211,556 3,134,947
(Decrease)/Increase in cash
and cash equivalents (766,413) 1,087,088 1,477,179
Cash and cash equivalents at beginning
of period 2 1,860,662 383,063 383,063
Effect of foreign exchange rate changes 4,345 (578) 420
Cash and cash equivalents at end of period 1,098,594 1,469,573
1,860,662
NOTES TO THE CASH FLOW STATEMENT
FOR THE 6 MONTHSED 30 JUNE 2016
1. RECONCILIATION OF LOSS BEFORE TAX TO CASH GENERATED FROM
OPERATIONS
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to Year ended
30 June 2016 30 June 2015 31 Dec 2015
GBP GBP GBP
Loss before tax (448,139) (528,476) (972,776)
Depreciation 195 - -
Shares issued in lieu of remuneration - - 28,529
Gain on foreign exchange currency movement (37,828) - (6,560)
Finance income (4,571) (2,537) (7,275)
(490,343) (531,013) (958,082)
Increase in trade and
other receivables (26,737) (4,729) (20,735)
(Decrease)/Increase in trade and
other payables (97,742) (54,446) 19,865
Net cash used in operations (614,822) (590,188) (958,952)
2. CASH AND CASH EQUIVALENTS
The amounts disclosed on the cash flow statement in respect of
cash and cash equivalents are in respect of the statement of
financial position amounts:
(Unaudited) (Unaudited) (Audited)
6 months to 6 months to Year ended
30 June 2016 30 June 2015 31 Dec 2015
GBP GBP GBP
Cash and cash equivalents 1,098,594 1,469,573 1,860,662
Cash and cash equivalents consist of cash in hand and balances
with banks.
NOTES TO THE FINANCIAL STATEMENTS UNAUDITED RESULTS
FOR THE 6 MONTHSED 30 JUNE 2016
1. Basis of preparation
These interim financial statements for the six month period
ended 30 June 2016 have been prepared using the historical cost
convention, on a going concern basis and in accordance with
applicable International Financial Reporting Standards as adopted
by the European Union ("IFRS") and with those parts of the UK
Companies Act 2006 applicable to companies reporting under IFRS as
adopted by the European Union. They have also been prepared on a
basis consistent with the accounting policies expected to be
applied for the year ending 31 December 2016, and which are also
consistent with the accounting policies applied for the year ended
31 December 2015 except for the adoption of any new standards and
interpretations.
These interim results for the six months ended 30 June 2016 and
the comparatives for the six months ended 30 June 2015 are
unaudited and do not constitute statutory accounts as defined in
Section 434 of the Companies Act 2006. The financial statements for
the year ended 31 December 2015 have been delivered to the
Registrar of Companies and filed at Companies House and the
auditors' report on those financial statements was unqualified and
did not contain a statement made under Section 498(2) or Section
498(3) of the Companies Act 2006.
2. Loss per share
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average
number of ordinary shares of 911,783,126 (30 June 2015 -
736,490,500 and 31 December 2015 - 824,857,193) outstanding during
the period. There is no difference between the basic and diluted
loss per share.
3. Restricted bank deposits
In February 2015, US$500,000 was placed on deposit with Habib
Bank as security for a performance bond. The deposit is repayable
on compliance with the conditions of the bond.
4. Called up share capital
(Unaudited) (Unaudited) (Audited)
30 June 2016 30 June 2015 31 Dec 2015
GBP GBP GBP
Allotted, called up and fully paid
911,783,126 Ordinary shares of 0.1p each 911,783 911,783
911,783
The number of shares in issue was as follows:
Number of shares
Balance as 31 December 2014 389,009,493
Issued during the period 522,773,633
Balance at 30 June 2015 911,783,126
Issued during the period -
Balance at 31 December 2015 911,783,126
Issued during the period -
Balance at 30 June 2016 911,783,126
5. Post balance sheet events
There are no post balance sheet events to report.
For further information:
Oracle Coalfields PLC +44 (0) 203
Shahrukh Khan 102 4807
Brandon Hill Capital Limited +44 (0)203
Oliver Stansfield 463 5000
Peterhouse Corporate Finance +44 (0)20 7220
Charles Goodfellow 9791
Grant Thornton UK LLP
Salmaan Khawaja, Richard Tonthat, +44 (0) 207
Daniel Bush 373 5100
Blythe Weigh Communications
Tim Blythe, Camilla Horsfall, +44 (0) 207
Megan Ray 138 3204
Fortbridge Consulting +44 (0) 7966
Matt Beale, Bill Kemmery 389196
The information contained within this announcement is considered
to be inside information, as defined in Article 7 of the Market
Abuse Regulation No. 596/2014, prior to its release.
In accordance with the AIM Rules for Companies, a copy of this
announcement will be made available on Oracle's website at:
www.oraclecoalfields.com
This information is provided by RNS
The company news service from the London Stock Exchange
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