Unaudited Interim Results 6months ended 30 June 21

RNS Number : 6126N
Reabold Resources PLC
30 September 2021
 

30 September 2021

 

REABOLD RESOURCES PLC

("Reabold" or "the Company")

 

Unaudited Interim Results for six months ended 30 June 2021

 

Reabold Resources plc (AIM: RBD), the investor in upstream oil and gas projects, announces its unaudited interim results for the six months ended 30 June 2021.

 

For further information, contact:

 

Reabold Resources plc

Sachin Oza

Stephen Williams

 

c/o Camarco

+44 (0) 20 3757 4980

 

 

Strand Hanson Limited - Nominated & Financial Adviser

James Spinney

Rory Murphy

James Dance

 

Stifel Nicolaus Europe Limited - Joint Broker

Callum Stewart

Simon Mensley

Ashton Clanfield

 

Panmure Gordon - Joint Broker

Hugh Rich

Nick Lovering

 

+44 (0) 20 7409 3494

 

 

 

 

+44 (0) 20 7710 7600

 

 

 

 

+44 (0) 207 886 2733

Camarco

James Crothers

Rebecca Waterworth

Billy Clegg

 

+44 (0) 20 3757 4980

 

 

CHAIRMAN'S STATEMENT

 

The Board is pleased to report on the progress in the Company's investment portfolio in the six months ended 30 June 2021, and post-period end.

 

Highlights:

· Further investment of £1.0 million into Corallian Energy Limited ("Corallian") by way of a Convertible Loan to fund the submission of a draft Field Development Plan for the Victory gas field, planned to occur before the end of 2021. Subsequently, the Company sold 50% of its Convertible Loan for net proceeds of £0.5 million to a group of strategic investors.

· Reabold acquired an additional 13.12% of Corallian shares from existing Corallian shareholders, in exchange for the issue of 468,994,086 new Reabold shares, resulting in the Company now owning 49.99% of Corallian, thereby increasing its interest in the Corallian owned Victory gas discovery.

· West Newton B-1Z completion and testing operations commenced, targeting hydrocarbons in the conventional Kirkham Abbey Formation reservoir, which is key for the future development of the West Newton licence and, in particular, for indicating the optimal location for the drilling of the horizontal B-2 well.

· Completion of Environmental Baseline Survey at Victory gas discovery.

· The 18 month extension of the Parta Exploration Licence in Romania, held 100% by Danube Petroleum Limited, for the current exploration phase until 3 December 2022.

· Oversubscribed placing at a premium to the prevailing market price to raise £7.5million, supported by key existing and new institutional investors.

 

Highlights - Post-Period end:

· Testing of the B-1Z well to date has yielded significant information to increase the understanding of the West Newton field, with both gas and liquid hydrocarbons recovered to surface, which is consistent with information gathered from the A site wells and further evidence that there is a substantial hydrocarbon column and resource in place.

 

Rathlin Energy (UK) Limited and PEDL183

 

The Company holds a 59.5% interest in Rathlin Energy (UK) Limited ("Rathlin"), the operator and 66.67% equity interest holder in PEDL183 licence, onshore UK, which contains the significant West Newton field, potentially the largest hydrocarbon discovery onshore UK since 1973.  In addition, the Company holds a direct 16.665% interest in PEDL 183.

 

During the reporting period and subsequently, the West Newton B-1Z completion and testing operations commenced, targeting hydrocarbons in the conventional Kirkham Abbey Formation reservoir, which is key for the future development of the West Newton licence and, in particular, for indicating the optimal location for the drilling of the horizontal B-2 well.

 

Testing of the B-1Z well to date has yielded significant information to increase the understanding of the West Newton field. Both gas and liquid hydrocarbons have been recovered to surface, which is consistent with information gathered from the A site wells and further evidence that there is a substantial hydrocarbon column and resource in place.

 

As expected, the reservoir has demonstrated a dual permeability system, with natural fractures alongside a lower permeability matrix.  Completion fluids were injected into the formation at a rate constrained by the pumps on site at 5.7 barrels per minute (8,208 barrels per day).

 

As announced on 31 August 2021, clear signs of reservoir damage have been observed near wellbore areas, which was expected to be  preventing more significant flow at the time of testing.  Accordingly, a measurable flow of hydrocarbons has not yet been achieved.

 

The B-1Z well has therefore been suspended with pressure gauges monitoring pressure build up in the well bore, with a view to further testing following the results at the A-2 well.

 

The testing equipment was successfully moved to the West Newton A site, and the previously interrupted test at the A-2 well restarted.  Reabold remains fully funded for its intended work programme.

 

Corallian

 

The Company holds a 49.99% interest in Corallian, following completion of the acquisition of an additional 13.12% interest during the reporting period. 

 

Corallian holds a 100% interest in the Victory gas discovery in block 207/1a, located in the north-west region of the Shetland Isles.  The Victory project is considered a low-risk gas development which has been fully appraised and requires no additional pre-development drilling. SLR Consulting estimates that Victory has 2C contingent resources of 157 BCF; valuations (NPV10) of Victory currently range from circa £85 million (based on current gas price forecasts of 42.5p/therm) to circa £146 million (based on historical average gas price and base case valuation of 50p/therm).

 

On 22 February 2021, the Company announced a further investment of £1,000,000 into Corallian, by way of a Convertible Loan, to fund the submission of a draft Field Development Plan for the Victory gas field before the end of 2021. The Convertible Loan, including interest at a rate of 15% per annum (accruing daily), will convert into new ordinary shares in Corallian within 21 months from the date of entering into the instrument. If, during this period, Corallian is acquired, undertakes a material disposal of assets, an initial public offering or a reverse takeover, (each, a "corporate action"), where the relevant valuation is greater than £3.20 per share, the Convertible Loan will convert at £3.20 per share. If the relevant valuation is below £3.20 per share, then the Convertible Loan will convert at a price equal to the relevant valuation.  If no such corporate action has taken place within 21 months, the Convertible Loan will automatically convert at a price of £1.50 per Corallian share.  Subsequently, on 3 March 2021, the Company announced that it sold 50 % of its Convertible Loan to Corallian for net proceeds of £500,000 to a group of strategic investors.

 

In May 2021, Reabold completed a conditional offer to acquire up to an additional 13.12% of Corallian shares from existing Corallian shareholders, in exchange for new Reabold shares, at a ratio of 474 Reabold shares for 1 Corallian share (the "Offer"). The Offer was oversubscribed, and all conditions precedent were fulfilled. As a result, Reabold acquired 989,439 Corallian shares, equivalent to 13.12 % of Corallian from existing Corallian shareholders, and issued 468,994,086 new Reabold shares as consideration. Consequently, Reabold's equity interest in Corallian increased to 49.99%.

 

During the reporting period, Corallian successfully completed the Environment Baseline Survey ("EBS") for the Victory project.  The EBS is a key milestone for the submission of a draft Field Development Plan ("FDP") to the UK's Oil and Gas Authority ("OGA"), planned for the end of 2021.  Reabold provided the funding to Corallian for the EBS by way of the Convertible Loan.

 

Data acquisition for the Victory EBS was successfully completed on 23 June 2021, with the survey completed within the budget estimate and with zero health and safety incidents. Data acquired include side-scan sonar, multibeam echosounder, seabed sediment samples, and video and camera stills over the proposed project sites. This data will be used to complete an Environmental Impact Assessment and ultimately an Environmental Statement for the Victory project. Corallian management expect data and sample processing and interpretation will take approximately four months and advise that the Environmental Statement remains on schedule to be submitted to the relevant UK authorities, together with the Victory draft FDP, by the end of 2021.  Additional updates will be provided during the second half of the year as further progress is made towards FDP submission.

 

Danube Petroleum Limited

 

Reabold has a 50.8% equity position in Danube Petroleum Limited ("Danube"), with ASX listed ADX Energy Ltd ("ADX") holding the remaining 49.2%.  has a 100 % interest in the Parta licence in Romania, which includes the IMIC-1 discovery and the IMIC-2 prospect.

 

In June 2021, ADX announced an extension of the Parta Exploration Licence ("Parta") in Romania, with the Romanian National Agency for Mineral Resources approving an 18-month extension for Parta for the current exploration phase until 3 December 2022.

 

Reabold California

 

The Company, through its wholly-owned subsidiary Reabold California LLC, has interests in oil and gas leases in California with low-cost production and multiple near-term, high-impact drilling opportunities, with low drilling costs and a fast path to monetisation.  The leases are operated by Integrity Management Solutions, a Californian operating company that leads direct operational decisions pertaining to the leases.

 

Production across Reabold's California licences, being West Brentwood and Monroe Swell, in which Reabold has a 50% working interest, for the period from 1 January 2021 to 30 June 2021 was 25,212 (gross) and 12,606 (net) barrels of oil equivalent ("boe"). Reabold's net revenue generated from the sales of hydrocarbons in California over the period was US$777,000 (US$622,000 net of royalties). This equates to a realised price of US$60.6/boe (US$48.5/boe net of royalties).  The estimated cash operating cost was approximately US$36.6/boe.

 


Unit

H1 2021

H1 2020

Total 2020

Total Production

boe*

25,212

37,426

67,780

Reabold's 50% share of production

boe*

12,606

18,713

33,890

Reabold's gross revenue

US$

$777,000

$718,000

$1,328,000

Reabold's revenue net of royalties

US$

$622,000

$575,000

$1,063,000

Realised price per boe

US$

$60.6

$38.1

$38.4

Realised price per boe net of royalties

US$

$48.5

$30.5

$30.7

Cash operating cost per boe

US$

$36.6

$14.4

$18.5

* gas equivalence based on 6,000 scf/bbl

 

The significant increase in in oil prices during the period was offset by lower production due to workover of wells and bringing enhanced storage infrastructure online.  Operating costs per barrel were higher due to significantly increased water disposal costs, which will be reduced when the water disposal wells are brought online.  

 

Funding

 

On 28 January 2021, the Company announced that it had raised £7.5 million in gross proceeds by way of an oversubscribed placing of 890,909,093 new ordinary Reabold shares to new and existing institutional investors by Stifel, and a total of 472,727,270 new ordinary Reabold shares had been being subscribed for by certain Directors and institutional investors, at a price of 0.55 pence per share.  The net proceeds of the fundraise were to progress activity across our portfolio in 2021 and working capital.

 

Financial Review

 

The Group loss for the 6 months ended 3 0 June 2021 was £1,384,000, compared to a loss of £ 508,000 for the corresponding period in 2020, reflecting increased administration expenses during the reporting period, and the positive exchange rate movement in the 2020 comparative period. 

 

During the period, production from the Group's California assets generated revenues of £ 560,000 (2020: £570,000) and a gross loss of £7,000 (2020: £80,000), reflecting higher operating costs due to significantly increased water disposal costs, as noted above.

 

For the six months ended 3 0 June 2021, the Group net cash used in operating activities was £550,000 (2020: net used of £ 567,000 ). The net cash outflows from investing activities increased from £ 227,000 for the 6 months ending 3 0 June 2020 to £1,099,000 for the 6 months ended 3 0 June 2021, reflecting the Company's investment in the Convertible Loan and exploration and evaluation expenditure in respect to the Company's direct interest in West Newton. During the period, the Group raised £6,881,000 in net funds from share placements (2020: £Nil). 

 

Cash and cash equivalents as at 3 0 June 20 21 was £6,398,000 (2020: £ 5,485,000 ). 

 

The Group total net assets and net current assets as at 3 0 June 2 0 21 were £47,654,000 (2020: £39,826,000) and £6,640,000 (2020: £ 5,961,000 ) respectively. 

 

Outlook

 

Having secured funding to significantly progress activity across our portfolio in 2021, we look forward to an exciting year ahead and beyond.

 

This report was approved by the Board and signed on its behalf:

 

 

Jeremy Edelman

Chairman

 

30 September 2021



 

GROUP STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 30 JUNE 2021

 



Unaudited

Unaudited

Audited


 6 months to

 6 months to

12 months to


30-Jun-21

30-Jun-20

31-Dec-20

Notes

£'000

£'000

£'000






Revenue


560

570

1,035

Cost of sales

3

(567)

(490)

(1,031)

Gross profit


(7)

80

4






Net gain in financial assets measured at fair value through P&L

5

30

-

-

Other income


27

35

60

Impairment


-

-

(239)

Administration expenses


(954)

(153)

(1,628)

Share based payments expense

7

(70)

(100)

-

Loss on ordinary activities


(974)

(138)

(1,803)






Share of losses of associates

4

(411)

(380)

(878)

Finance income


1

10

13

Loss before tax for the period


(1,384)

(508)

(2,668)






Taxation


-

-

-

Loss for the financial period


(1,384)

(508)

(2,668)








Other comprehensive income:





Foreign exchange gain on translation of foreign subsidiaries


1

107

(39)

Other comprehensive income


1

107

(39)






Total comprehensive loss for the financial period

(1,383)

(401)

(2,707)








Attributable to:






Equity holders


(1,383)

(401)

(2,707)



(1,383)

(401)

(2,707)








Earnings per share





Basic and fully diluted loss per share (pence)

2

(0.02)

(0.006)

(0.04)








 

GROUP STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2021

 



Unaudited

Unaudited

Audited



30-Jun-21

30-Jun-20

31-Dec-20


Notes

£'000

£'000

£'000

ASSETS





Non-current assets





Exploration & evaluation assets


8,131

3,288

7,586

Property, plant & equipment


4,411

5,369

4,569

Investments in associates

4

28,106

25,233

25,335

Goodwill on acquisition


329

329

329

Investments in equity instruments


15

15

15

Convertible loan

5

530

-

-



41,522

34,234

37,834

Current assets





Inventory


21

20

34

Prepayments


-

25

85

Trade and other receivables


201

584

379

Restricted cash


206

202

208

Cash and cash equivalents


6,398

5,485

1,139



6,826

6,316

1,845






Total assets


48,348

40,550

39,679






EQUITY





Capital and reserves





Share capital

6

9,044

6,861

7,211

Share premium account


29,033

19,768

20,819

Capital redemption reserve


200

200

200

Share based payment reserve

7

1,816

1,746

1,746

Foreign currency translation reserve


(38)

108

(39)

Retained earnings


7,599

11,143

8,983

Total shareholders' funds


47,654

39,826

38,920






LIABILITIES





Current liabilities





Trade and other payables


186

278

192

Provisions


-

-

-

Accruals


-

76

65



186

355

257






Non-current liabilities





Deferred tax liability


329

329

329

Provision for decommissioning


179

40

173



508

369

502






Total equity and liabilities


48,348

40,550

39,679



 

GROUP STATEMENT OF CASH FLOWS

FOR THE PERIOD ENDED 30 JUNE 2021

 



Unaudited


Unaudited


Audited



6 months to


6 months to


12 months to



30-Jun-21


30-Jun-20


31-Dec-20


Note

£'000


£'000


£'000

Cash flows from operating activities







Loss for the financial period


(1,384)


(508)


(2,668)

Adjustments:







Net gain on financial assts at FV through profit or loss

5

30


-


-

Depreciation


117


161


326

Impairment


-


-


239

Decommissioning finance charge


2


-


7

Share based payments

7

70


100


100

Operating cash flows before movement in working capital


(1,166)


(247)


(1,996)








(Increase)/decrease in receivables


178


271


478

Increase/(decrease) in payables and accruals


(71)


(677)


(776)

Increase/(decrease) in provisions


-


(299)


(299)

Increase/(decrease) in provision for decommissioning


-


(27)


106

(Increase)/decrease in prepayments


85


33


(28)

Decrease/(increase) in inventory


13


(1)


(15)

Cash used in operating activities


(961)


(947)


(2,529)








Share of losses of associates

4

411


380


878

Net cash used in operating activities


(550)


(567)


(1,652)








Net cash flows from investment activities







Acquisition of investments in associates


-


-


(600)

Expenditure on oil & gas property


(16)


(309)


(398)

Expenditure on exploration & evaluation assets


(583)


(57)


(1,683)

Acquisition of exploration & evaluation rights


-


-


(1,448)

Acquisition of convertible loan notes

5

(1,000)


-


-

Sale of convertible loan notes

5

500


-


-

Additions to restricted cash


-


139


132

Net cash used in investment activities


(1,099)


(227)


(3,996)








Cash flows from financing activities







Share placement net proceeds


6,881


-


-

Net cash generated from financing activities


6,881


-


-








Net increase/(decrease) in cash and cash equivalents


5,232


(794)


(5,648)

Net foreign exchange difference


27


(438)


69

Cash and cash equivalents at the beginning of the period


1,139


6,717


6,717

Cash and cash equivalents at the end of the period


6,398


5,485


1,139








Cash and cash equivalents comprises:







Cash and cash equivalents


6,398


5,485


1,139



6,398


5,485


1,139

 

 

GROUP STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 30 JUNE 2021


Share

capital

Share premium

account

Capital Redemp-tion reserve

Share based payments reserve

Foreign currency translat-ion reserve

Retained earnings

Total


£'000

£'000

£'000

£'000

£'000

£'000

£'000









Balance 31 December 2019 - audited

6,845

19,685

200

1,746

-

11,651

40,127









Loss for the period

-

-

-

-

-

(508)

(508)

Other comprehensive income

-

-

-

-

107

-

107

Total comprehensive loss for the period

-

-

-

-

107

(508)

(401)









Changes in equity for period to

30 June 2020








Issue of share capital

16

84

-

-

-

-

100









Balance 30 June 2020 - unaudited

6,861

19,769

200

1,746

107

11,143

39,826









Loss for the period

-

-

-

-

-

(2,160)

(2,160)

Other comprehensive income

-

-

-

-

(146)

-

(146)

Total comprehensive loss for the period

-

-

-

-

(146)

(2,160)

(2,306)









Changes in equity for period to

31 December 2020








Issue of share capital

350

1,050

-

-

-

-

1,400









Balance 31 December 2020 - audited

7,211

20,819

200

1,746

(39)

8,983

38,920









Loss for the period

-

-

-

-

-

(1,384)

(1,384)

Other comprehensive income

-

-

-

-

1

-

1

Total comprehensive loss for the period

-

-

-

-

(38)

(1,384)

(1,383)









Changes in equity for period to

30 June 2021








Issue of share capital - placing

1,364

6,136

-

-

-

-

7,500

Costs on issue of shares

-

(619)

-

-

-

-

(619)

Issue of share capital - acquisition

469

2,697

-

-

-

-

3,166

Share based payment

-

-

-

70

-

-

70









Balance 30 June 2021 - unaudited

9,044

29,033

200

1,816

(38)

7,599

47,654


NOTES TO THE INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 30 JUNE 2021

 

1.  Basis of preparation

 

These interim financial statements have been prepared using policies based on International Financial Reporting Standards (IFRS and IFRIC interpretations) issued by the International Accounting Standards Board ("IASB") as adopted for use in the EU. They do not include all disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the 2020 Annual Report. The financial information for the half years ended 30 June 2021 and 30 June 2020 does not constitute statutory accounts within the meaning of Section 434(3) of the Companies Act 2006 and is unaudited.

 

The annual financial statements of Reabold Resources Plc are prepared in accordance with IFRSs as adopted by the European Union. The comparative financial information for the year ended 31 December 2020 included within this report does not constitute the full statutory accounts for that period. The statutory Annual Report and Financial Statements for 2020 have been filed with the Registrar of Companies. The Independent Auditors' Report on that Annual Report and Financial Statement for 2020 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

 

After making enquiries, the directors have a reasonable expectation that the Company has adequate resources and support from key shareholders to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the half-yearly financial statements.

 

The same accounting policies, presentation and methods of computation are followed in these condensed financial statements as were applied in the Company's latest annual audited financial statements, with additional information in respect of significant accounting policies disclosed below.

 

The IASB has issued a number of IFRS and IFRIC amendments or interpretations since the last annual report was published. It is not expected that any of these will have a material impact on the Company.

 

2.  Loss per share

 

 

The calculations of the basic and diluted earnings per share are based on data the following:

Unaudited

6 months to

30-Jun-21

£'000

Unaudited

6 months to

30-Jun-20

£'000

Audited

12 months to 31-Dec-21

£'000

 

Loss for the year

 

(1,384)

 

(508)

 

(2,668)



Loss for the purpose of basic earnings per share

(2,668)





Number of shares




Weighted average number of ordinary shares in issue during the year

8,292,101,462

3,822,649,968

6,850,918,924









Loss per share




Basic loss per share (pence)

(0.02)

(0.04)

(0.04)





As the Group is reporting a loss in each period, in accordance with IAS 33, outstanding share options are not considered to be dilutive because the exercise of the share options would have the effect of reducing the loss per share.



 

3.  Cost of sales





Unaudited

Unaudited

Audited





30-Jun-21

30-Jun-20

31-Dec-20





£'000

£'000

£'000








Production costs


338

215

498

 

Royalties




  114 

207

Depreciation of oil & gas assets


117

161

326

 





490

1,031

 

4.  Investments in associates

 

The table below represents the Company's associates, in which it has significant influence:

 






Holding

Holding

Holding



Country of


Nature of

Class of

Unaudited

Unaudited

Audited


Associate

registration

Registered address

business

shares

30-Jun-21

30-Jun-20

31-Dec-20











Corallian Energy Limited

England & Wales

Blackstable House, Longridge, Sheepscombe, Stroud, Gloucestershire, GL6 7QX

Oil & gas

Ordinary

49.99%

34.9%

36.9%











Danube Petroleum Limited

England & Wales

3 Waterfront Business Park, Brierley Hill, West Midlands, DY5 1LX

Oil & gas

Ordinary

50.8%

50.5%

50.8%











Rathlin Energy (UK) Limited

England & Wales

3rd Floor, 11-12 St James' Square, London, SW1Y 4LB

Oil & gas

Ordinary

59.5%

59.5%

59.5%


 

All of the Company's associates are unlisted.  A breakdown of investments in associates as at 30 June 2021 and comparative periods along with the respective changes during the period then ended are summarised as follows:

 





Unaudited

Unaudited

Audited





30-Jun-21

30-Jun-20

31-Dec-20





£'000

£'000

£'000








At 1 January



25,613

25,613

Additions




-

600

Share of profit/(loss) of associates


(380)

(878)

At 30 June




25,233

25,335

 

During the six months ended 30 June 2021, the Company increased its investment in associates by £3,182,000 (2020: £Nil), with the Company acquiring 989,439 shares in Corallian for the consideration of the issue of 468,994,086 new Ordinary Shares of 0.1p each, at a deemed price of 0.675 pence each, increasing the Company's interest in Corallian from 36.9% to 49.99%

 

 

Reabold's share of loss of associates for the 6 months ended 30 June 2021 was £411,000 (2020: £380,000).

 

 

5.  Convertible loan notes



Unaudited

Unaudited

Audited



30-Jun-21

£'000

30-Jun-20

£'000

31-Dec-20

£'000






At 1 January


-

-

-

Addition


1,000

-

-

Disposal


(500)

-

-

FVTPL recognised in loss for the period


30

-

-

At 30 June


530

-

-

 

On 24 February 2021, the Company completed the subscription for a £1 million convertible loan instrument (the "Convertible Loan") with Corallian.  The Convertible Loan, including interest at a rate of 15 % per annum (accruing daily), will convert into new ordinary shares in Corallian ("Corallian Shares") within 21 months from the date of entering into the instrument. If, during this period, Corallian is acquired, undertakes a material disposal of assets, an initial public offering or a reverse takeover, where the relevant valuation (each, a "corporate action") is greater than £3.20 per share, the Convertible Loan will convert at £3.20 per share. If the relevant valuation is below £3.20 per share, then the Convertible Loan will convert at a price equal to the relevant valuation.  If no such corporate action has taken place within 21 months, the Convertible Loan will automatically convert at a price of £1.50 per Corallian share.

 

On 3 March 2021, the Company announced the sale of a portion of the Convertible Loan in Corallian with a principal value of £500,000, to a group of strategic investors, in exchange for net cash proceeds of £500,000.

 

On recognition, the Convertible Loan was classified as a financial asset at fair value through profit or loss ("PVTPL").  The fair value of the Convertible loan was estimated at acquisition and at balance date, with a gain in FVTPL for the reporting period of £30,000, which is recognised in the loss for the period.  

 

The estimated fair value of the Convertible Loan at acquisition on 24 February 2021 and at the period end of 30 June 2021, was assessed using a binomial tree to value the Convertible Loan at monthly nodes. The fair value at the disposal by the Company on 3 March 2021 was assumed to be the same at 24 February 2021.  The key inputs and assumptions into the binomial tree included the following:

 


Risk free

rate

Monthly share price volatility

Share

price

Risk discount rate

As at 24 February 2021 & 3 March 2021

0.27%

18.63%

£2.20

18.5% p.a.

As at 30 June 2021

0.17%

19.23%

£3.00

18.5% p.a.

 

The share price assumption at the date of acquisition was based on the last fund raise price of Corallian.  The share price assumption as at 30 June 2021 was the estimated cash price, noting the share exchange acquisition by Reabold of Corallian shares at a deemed price of £3.20 per share.

 

The monthly share price volatility was based on a portfolio of comparable listed oil and gas companies. 

 



 

6.  Called up share capital


30-Jun-21

No. shares

30-Jun-20

No. shares

31-Dec-20

No. shares

Ordinary shares




Opening ordinary shares of 0.10 pence each

7,096,982,101

6,730,630,476

6,730,630,476

Issue of new ordinary shares of 0.10 pence each

1,832,630,449

16,351,265

366,351,625

Closing ordinary shares of 0.10 pence each

8,929,612,550

6,746,981,741

7,096,982,101





"A" Deferred Share




Opening "A" Deferred Share of 1.65 pence each

6,915,896

6,915,896

  6,915,896

Closing "A" Deferred Share of 1.65 pence each

6,915,896

6,915,896

6,915,896






30-Jun-21

£'000

30-Jun-20

£'000

31-Dec-20

£'000

Ordinary shares




Opening ordinary shares of 0.10 pence each

7,097

6,731

6,731

Issue of new ordinary shares of 0.10 pence each

1,833

16

366

Closing ordinary shares of 0.10 pence each

8,930

6,747

7,097





"A" Deferred Share




Opening "A" Deferred Share of 1.65 pence each

114

114

114

Closing "A" Deferred Share of 1.65 pence each

114

114

114

 

On 28 January 2021, the Company issued announced a placing of 1,363,636,363 new Ordinary Shares of 0.1 pence each, at a price of 0.55 pence per share, raising gross proceeds of £7.5 million.

 

On 14 May 2021, the Company issued 468,994,086 new Ordinary Shares of 0.1p each, at a deemed price of 0.675 pence each, in consideration for the acquisition of 989,439 shares in Corallian.

 

7.  Share options and share based payments

 

As announced on 26 February 2021, the Company amended the expiry dates on a total of 190,000,000 existing options held by Directors, such that their expiry dates are extended by 12 months, to 19 October 2022, and additional extended vesting terms are applicable, as outlined below. The exercise prices of the options remain unchanged.

 

Executive

Position

Existing Options

Held

Exercise Price

Current

Expiry

Amended

Expiry

Current

Vesting Status

Amended

Vesting

Dates

Sachin Oza

Co-CEO

30,000,000

30,000,000

30,000,000

0.50p

0.75p

1.00p

19-Oct-21

19-Oct-21

19-Oct-21

19-Oct-22

19-Oct-22

19-Oct-22

Vested

Vested

Vested

30-Sep-21

31-Dec-21

31-Mar-22

Stephen Williams

Co-CEO

30,000,000

30,000,000

30,000,000

0.50p

0.75p

1.00p

19-Oct-21

19-Oct-21

19-Oct-21

19-Oct-22

19-Oct-22

19-Oct-22

Vested

Vested

Vested

30-Sep-21

31-Dec-21

31-Mar-22

Anthony Samaha

Finance Director

10,000,000

0.50p

19-Oct-21

19-Oct-22

Vested

30-Sep-21

 

During the six months ended 30 June 2021, the Company granted 10,000,000 options (2020: nil), being to Anthony Samaha, the Company's Finance Director, exercisable at 1.0p, on or before 19 October 2022, vesting on 31 December 2021. The exercise price represented a premium of 72 % to the Company's closing share price of 0.58p on the date prior to grant of 25 February 2021.

 

At 30 June 2021 there were 325,000,000 share options outstanding (2020: 315,000,000).

 

Option Holder

At

1 January 2021

No.

Issued during the period

No.

Lapsed / Exercised / during the period

No.

At

30 June 2021

No.

Exercise Price

Pence

Vesting Date

Expiry Date

Sachin Oza

30,000,000

-

-

30,000,000

0.50p

30/09/2021(1)

19/10/2022(1)

Sachin Oza

30,000,000

-

-

30,000,000

0.75p

31/12/2021(1)

19/10/2022(1)

Sachin Oza

30,000,000

-

-

30,000,000

1.00p

31/03/2022(1)

19/10/2022(1)

Sachin Oza

20,000,000

-

-

20,000,000

0.60p

19/03/2018

19/03/2022

Sachin Oza

20,000,000

-

-

20,000,000

0.90p

14/03/2019

19/03/2022

Sachin Oza

20,000,000

-

-

20,000,000

1.20p

14/09/2019

19/03/2022

Stephen Williams

30,000,000

-

-

30,000,000

0.50p

30/09/2021(1)

19/10/2022(1)

Stephen Williams

30,000,000

-

-

30,000,000

0.75p

31/12/2021(1)

19/10/2022(1)

Stephen Williams

30,000,000

-

-

30,000,000

1.00p

31/03/2022(1)

19/10/2022(1)

Stephen Williams

20,000,000

-

-

20,000,000

0.60p

19/03/2018

19/03/2022

Stephen Williams

20,000,000

-

-

20,000,000

0.90p

14/03/2019

19/03/2022

Stephen Williams

20,000,000

-

-

20,000,000

1.20p

14/09/2019

19/03/2022

Anthony Samaha

10,000,000

-

-

10,000,000

0.50p

30/09/2021(1)

19/10/2022(1)

Anthony Samaha

5,000,000

-

-

5,000,000

0.60p

19/03/2018

19/03/2022

Anthony Samaha

-

10,000,000

-

10,000,000

1.00p

31/12/2021

19/10/2022


315,000,000

10,000,000

-

325,000,000




 

(1)   The Company amended the expiry date and vesting conditions of existing 190,000,000 existing options on 26 February 2021.

 

The number and weighted average exercise prices of share options are as follows:

 


At 30 June 2021

At 30 June 2020


Weighted average exercise price

Number of options

Weighted average exercise price

Number of options

Outstanding at 1 January

0.8p

315,000,000

0.8p

315,000,000

Granted during the period

-

10,000,000

-

-

Forfeited during the period

-

-

-

-

Exercised during the period

-

-

-

-

Outstanding at 30 June

0.8p

325,000,000

0.8p

315,000,000

Exercisable at 30 June

0.9p

125,000,000

0.8p

315,000,000

 

The options outstanding at 30 June 2021 have a weighted average contractual life of 1.07 years (2020: 1.47 years).

 

Under IFRS 2, the incremental charge generated by a modification or amendment of the options granted, should be recognised over the remaining vesting period. In the case of the new issue, the charge should be recognised over the vesting period.

 

For the options granted and amended on 26 February 2021, the fair values were calculated using the Black-Scholes model. The key inputs into the model were as follows:

 


Risk free rate

Share price volatility

Expected life

Share price at date of grant

Granted & amended 26 February 2021

0.27%

78%

1.64 years

0.57p

 

The expected volatility was determined by calculating the historical volatility of the Company's share price.

 

The Company recognised total expenses relating to share-based payment transactions during the period of £70,000 (2020: £100,000).

 

8.  Events after the reporting period

 

There were no material events after the reporting date to disclose. 

 

9.  General Information

 

Reabold Resources plc is a company registered in England and Wales under the Companies Act. Registered in England number 3542727 at The Broadgate Tower, 8th Floor, 20 Primrose Street, London, England, EC2A 2EW. The principal activity of the Company is that of an investing company in accordance with the AIM Rules for Companies.

 

10.  Availability of this announcement

 

Copies of this announcement are available from the Company's website www.reabold.com .

 

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