Half Yearly Report

RNS Number : 4759O

Edenville Energy PLC

20 September 2013

 



20 September 2013

EDENVILLE ENERGY PLC ("Edenville" or the "Company") (AIM:EDL),

Interim Results for the Six Months Ended 30 June 2013

Edenville Energy plc, the African coal exploration and development company, today announces its unaudited Interim Results for the six months ended 30 June 2013.

Highlights for the period

·     Upgraded, JORC-compliant, Mineral Resource Estimate for Rukwa Coal Deposit published March 2013

·     Scoping Study commissioned to assess commercial viability of Rukwa Coal Project

·     Appointment of Sally Schofield as Chairman. Simon Rollason takes non executive Director position.

·     £5 million equity financing facility agreed between Edenville and Darwin Strategic

·     Drawdown of £106,895 in April 2013 under Darwin facility

·     £10,469,447  net assets

·     £300,560 loss

·     £341,910 cash reserves

Post period Highlights

·     Rukwa Coal Project Scoping Study Results published September 2013

·     Engagement of RAFCO Group, an East African Mining and Energy Specialist, September 2013

·     Further drawdown under the Darwin equity financing facility of £390,000 in September 2013

·     Appointment of Rufus Short as CEO, 20 September 2013

Sally Schofield, Chairman of Edenville, commented:

"The Board of Directors believes that Edenville is in a much stronger position with respect to fully recognising the commercial viability of its Namwele, Mkomolo and Muze coal deposits, collectively known as the Rukwa Coal Project, in south-western Tanzania. 

"The company is well funded to satisfy its immediate needs as it keeps a close eye on its operating costs. At the same time, we are maintaining a focused portfolio of licences in Tanzania and we aim to keep land holding costs as low as practically possible as we progress. 

"The conclusions of the Scoping Study published in September, demonstrates that there is a viable commercial opportunity for Edenville to become a power producer, utilising a small scale, coal-to-power business scenario."

Contact:

Edenville Energy plc                          [phone]

Sally Schofield - Chairman

FinnCap                                              [phone]

Geoff Nash / Charlotte Stranner / Joanna Weaving

Newgate Threadneedle                      [phone]

Graham Herring

Chairman's Statement

In February 2013, we welcomed Rufus Short to the Board, an addition which immediately had a positive impact on the Company from a corporate and operational perspective.  During March, the Company announced the change in Chairman, with Simon Rollason remaining on the Board as an NED to maintain the links built over the past 3 years in Tanzania and the UK. 

On 27 March 2013, the Company entered into a £5 million Equity Financing Facility ("EFF") with Darwin Strategic Limited ("Darwin"), a majority owned subsidiary of Henderson Global Investors' Volantis Capital ("Henderson Volantis"). The facility gives the Company access to efficient, cost effective financing, as needed. The facility can be used entirely at our discretion and considerably reduces our future financing risk. During the period, the Company raised £106,895 under this facility from a subscription of 53,000,000 ordinary shares at 0.2p per share. Subsequent to the end of the half year reporting period, on 17 September 2013, the Company raised a further £390,000 from a subscription of 210,069,392 ordinary shares at 0.186 per share. 

The publication of Edenville's updated Mineral Resource Estimate in March of this year saw a significant upgrade of coal tonnage from the Inferred Category, giving us 57.5 million tonnes of coal, Measured & Indicated, with a calorific value of 17.42MJ/Kg (float density = 2.0, yield 34.4%).  We are now in possession of a robust geological model, with the coal resource constrained to discrete coal zones within the overall coal measure sequence.

Edenville then focused on how best to monetise this upgraded resource, commissioning SMS Consultants to generate an independent Scoping Study.  The conclusions of the Scoping Study, published in September, demonstrate that there is a commercial opportunity for Edenville to become a power producer, utilising a small scale, coal-to-power business scenario.

Edenville maintains a very focused portfolio of Licences in Tanzania and we aim to keep land holding costs as low as practically possible as we progress.  We will be reviewing our Licenses and consider whether to renew certain holdings, particularly in the Uranium based areas given our focus on coal. The company is currently in a period of relatively low capital expenditure and anticipates burn rates to remain low as we enter the next stage of our development.

The recent engagement of RAFCO Group, an East African Mining and Energy specialist, is a positive step which will help progress our Rukwa Coalfields towards a development decision and identify like-minded co-investors and partners to participate in the next phase of the project's development.

EDENVILLE ENERGY PLC

chairman's statement

FOR THE SIX MONTHS ENDED 30 JUNE 2013

I am pleased to report on the interim results of the Group for the six months ended 30^th June 2013.

Operational Review

The first six months of 2013 saw Edenville's comprehensive drill programme come to a close, with the final set of drill results announced in January.  A total of 19 additional boreholes were drilled within the Mkomolo Block, another 4 drilled within the Namwele Block and 5 within the Muze Block for a combined total meterage of 4,528.84m during the 2012 drill season.

Edenville commissioned Sound Mining Solutions Limited ('SMS'), of South Africa, to generate a new Mineral Resource Statement for the Namwele, Mkomolo and Muze block, collectively known as the Rukwa Coal Project.  For the purpose of the resource estimate, SMS used a total of 41 diamond drillholes for a total meterage of 5,726.26m at the Mkomolo project, 12 drillholes at Namwele and 5 at Muze, with total drilled meters of 1,426.90m and 831.84m respectively.

The SMS geological model identified separate, discrete coal zones within the overall coal measure sequence. The total in-situ tonnages contained within these coal zones is now estimated at 173 million tonnes Measured, Indicated and Inferred for the three deposits evaluated, of which 57.5 million tonnes is Measured and Indicated at 17.42 MJ/kg (float density = 2.0, yield = 34.4%).

This updated Mineral Resource Statement represented a significant upgrade from the Inferred category to Measured & Indicated and 90% of this resource tonnage lies within Mkomolo and Namwele blocks; Muze is still to be fully evaluated.

The positive results of the upgraded Mineral Resource Statement allowed Edenville to commission a further study from SMS - a Scoping Study designed to assess the commercial viability of the Company's Rukwa Coal Project.

The results of the Scoping Study were published post period end in September 2013, and outlined an opportunity for Edenville to progress the Rukwa Coal Project as the feed for a small scale coal-to-power operation.  The small power producer scenario offers the fastest and most viable commercial opportunity to move forward towards production, with optimal coal-to-power scenario based on 10MW power plant supplying the local market.  Just 35% of current coal resource has been assessed and this provides sufficient fuel to support 50 year power plant and project lifespan, via a straightforward open pit mine with small footprint.

Edenville engaged RAFCO Group, an East African Mining and Energy specialist, in September 2013 and will work together to identify like-minded co-investors and partners to take advantage of this next phase in the Company's development.

Financing

On 27 March 2013, the Company entered into a £5 million Equity Financing Facility ("EFF") with Darwin Strategic Limited ("Darwin"), a majority owned subsidiary of Henderson Global Investors' Volantis Capital ("Henderson Volantis"). The facility gives the Company access to efficient, cost effective financing, as needed. The facility can be used entirely at our discretion and considerably reduces our future financing risk. During the period, the Company raised £106,895 under this facility from a subscription of 53,000,000 ordinary shares at 0.2p per share. Subsequent to the year end, on 17 September 2013, the Company raised a further £390,000 from a subscription of 210,069,392 ordinary shares at 0.186 per share.  

Financial Results

The Company made a loss after taxation for the six month period ended 30 June 2013 of £300,560 and had net assets at that date of £10,469,447.

The total comprehensive income for the period was £282,737 (June 2012: Loss £410,273) which included a gain of £583,297 (30 June 2012: loss £91,150) arising from the translation of the Tanzanian subsidiary company accounts from US Dollars to Sterling.

At 30 June 2013, the Company had cash reserves of £341,910.

Outlook

Following the results of the recent Scoping study and our recent partnership with RAFCO, the Company is well placed to deliver on its more focused strategy of becoming a power producer, utilising a small scale, coal-to-power business scenario.

The Company is well funded for its immediate needs, has its costs well under control and the Board remains confident for the future of the Company as it seeks to deliver long term value for its shareholders.

Sally Schofield

Chairman

20 September 2013

EDENVILLE ENERGY PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 30 JUNE 2013

		Six months ended 30 June 13	Six months ended 30 June 12	Year ended 31 Dec 12
		Unaudited	Unaudited	Audited
	Note	£	£	£
Gross profit		-	-	-
Administrative expenses		(300,564)	(273,691)	(598,415)
Share based payments		-	(45,437)	(45,437)
Group operating loss		(300,564)	(319,128)	(643,852)
Finance income		4	5	10
Loss on operations before taxation		(300,560)	(319,123)	(643,842)
Taxation		-	-	-
Loss for the period after taxation		(300,560)	(319,123)	(643,842)
Other comprehensive income/(loss):
Gain/(loss) on translation of overseas subsidiary		583,297	(91,150)	(419,893)
Total comprehensive income/(loss) for the period		282,737	(410,273)	(1,063,735)
Attributable to:
Equity holders of the Company		282,998	(410,220)	(1,063,381)
Non controlling interest		(261)	(53)	(354)
		282,737	(410,273)	(1,063,735)
Loss per share
- basic and diluted (pence)	2	(0.007)	(0.007)	(0.01)

The loss for the period arises from the Group's continuing operations.

EDENVILLE ENERGY PLC

CONSOLIDATED statement of financial position

as at 30 june 2013

		As at 30 June 13	As at 30 June 12	As at 31 Dec 12
		Unaudited	Unaudited	Audited
	Note	£	£	£
Non-current assets
Property, plant and equipment		60,024	80,760	68,047
Intangible assets	4	11,221,803	9,541,191	10,379,827
		11,283,827	9,621,951	10,447,874
Current assets
Trade and other receivables		206,934	164,242	258,623
Cash and cash equivalents		341,910	2,283,822	784,072
		548,844	2,448,064	1,042,695
Current liabilities
Trade and other payables		(54,773)	71,424	(164,567)
Current assets less current liabilities		494,071	2,376,640	878,128
Total assets less current liabilities		11,777,898	11,998,591	11,326,002
Non -current liabilities
Provisions for other liabilities and charges		(1,308,451)	(1,274,803)	(1,231,400)
		10,469,447	10,723,788	10,094,602
Capital and reserves
Called-up share capital	5	976,188	940,588	965,588
Share premium account		11,995,027	11,913,686	11,913,686
Share based payment reserve		326,984	335,344	326,984
Foreign currency translation reserve		(74,030)	(328,584)	(657,327)
Retained earnings		(2,774,372)	(2,158,015)	(2,474,073)
Issued capital and reserves attributable to owners of the parent company		10,449,797	10,703,019	10,074,858
Non-controlling interest		19,650	20,769	19,744
Total equity		10,469,447	10,723,788	10,094,602

EDENVILLE energy PLC

CONSOLIDATED statement of changes in equity

FOR THE SIX MONTHS ENDED 30 JUNE 2013

	----------------------------------Equity Interests--------------------------------
	Share capital	Share premium	Retained Earnings	Share option reserve	Foreign currency translation reserve	Total	Non- Controlling interest	Total
	£	£	£	£	£	£	£	£
Balance at 1 January 2013	965,588	11,913,686	(2,474,073)	326,984	(657,327)	10,074,858	19,744	10,094,602
Issue of share capital	10,600	96,295	-	-	-	106,895	-	106,895
Share issue costs	-	(14,954)	-	-	-	(14,954)	-	(14,954)
Foreign currency translation	-	-	-	-	583,297	583,297	167	583,464
Loss for the period	-	-	(300,299)	-	-	(300,299)	(261)	(300,560)
Balance at 30 June 2013	976,188	11,995,027	(2,774,372)	326,984	(74,030)	10,449,797	19,650	10,469,447
Balance at 1 January 2012	740,588	9,707,686	(1,838,945)	289,907	(237,434)	8,661,802	21,055	8,682,857
Issue of share capital	200,000	2,300,000	-	-	-	2,500,000	-	2,500,000
Share issue costs	-	(94,000)	-	-	-	(94,000)	-	(94,000)
Share based payment charge	-	-	-	45,437	-	45,437	-	45,437
Minority interest on fair value adjustment	-	-	-	-	-	-	(223)	(223)
Other reserves	-	-	-	-	-	-	(10)	(10)
Foreign currency translation	-	-	-	-	(91,150)	(91,150)	-	(91,150)
Total comprehensive loss for the period	-	-	(319,070)	-	-	(319,070)	(53)	(319,123)
Balance at 30 June 2012	940,588	11,913,686	(2,158,015)	335,344	(328,584)	10,703,019	20,769	10,723,788
Balance at 1 January 2012	740,588	9,707,686	(1,838,945)	289,907	(237,434)	8,661,802	21,055	8,682,857
Issue of share capital	200,000	2,300,000	-	-	-	2,500,000	-	2,500,000
Cost of issue	-	(94,000)	-	-	-	(94,000)	-	(94,000)
Exercise of warrants	25,000	-	8,360	(8,360)	-	25,000	-	25,000
Share based payment charge	-	-	-	45,437	-	45,437	-	45,437
Foreign currency translation	-	-	-	-	(419,893)	(419,893)	(957)	(420,850)
Loss for the year	-	-	(643,488)	-	-	(643,488)	(354)	(643,842)
Balance at 31 December 2012	965,588	11,913,686	(2,474,073)	326,984	(657,327)	10,074,858	19,744	10,094,602

EDENVILLE ENERGY PLC

consolidated CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 30 JUNE 2013

	Six months ended 30 June 13	Six months ended 30 June 12	Year  ended 31 Dec 12
	Unaudited	Unaudited	Audited
	£	£	£
Cash flows from operating activities
Operating loss	(300,564)	(319,128)	(643,852)
Impairment of tangible & intangible non-current assets	-	-	-
Depreciation	8,756	2,220	13,812
Share based payments	-	45,437	45,437
Foreign exchange gain/(loss)	315	(5,978)	(34,803)
(Decrease)/increase in trade and other receivables	60,823	(60,538)	(153,537)
(Decrease)/increase in trade and other payables	(113,654)	(44,492)	48,292
Net cash from operating activities	(344,324)	(382,479)	(724,651)
Cash flows from investing activities
Purchase of exploration and evaluation assets	(190,679)	(187,137)	(1,370,377)
Purchase of fixed assets	(561)	(64,587)	(64,288)
Finance income	4	5	10
Net cash used in investing activities	(191,236)	(251,719)	(1,434,655)
Cash flows from financing activities
Proceeds on issue of shares	106,895	2,500,000	2,525,000
Share issue costs	(14,954)	(94,000)	(94,000)
Net cash generated in from financing activities	91,941	2,406,000	2,431,000
Net (decrease)/increase in cash and cash equivalents	(443,619)	1,771,802	271,694
Cash and cash equivalents at beginning of year	784,072	511,538	511,538
Exchange losses on cash and cash equivalents	1,457	482	840
Cash and cash equivalents at end of year	341,910	2,283,822	784,072

EDENVILLE ENERGY PLC

NOTES TO THE INTERIM REPORT

FOR THE SIX MONTHS ENDED 30 JUNE 2013

1.       Financial information and basis of preparation

The interim financial statements of Edenville Energy Plc are unaudited consolidated financial statements for the six months ended 30 June 2013 which have been prepared in accordance with IFRSs as adopted by the European Union.  They include unaudited comparatives for the six months ended 30 June 2012 together with audited comparatives for the year ended 31 December 2012.

The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 December 2012, as described in those financial statements.

The interim financial statements do not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006.  The statutory accounts for the year ended 31 December 2012 have been reported on by the company's auditors and have been filed with the Registrar of Companies.  The report of the auditors was unqualified and did not contain an emphasis of matter paragraph and did not contain any statement under section 498 of the Companies Act 2006.

The following new standards and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2013:

		Effective date (period beginning on or after)
IFRS 1, IAS 1, 16, 32, 34	Amendments resulting from Annual Improvements 2009-2011 Cycle	1 January 2013
IFRS 1	Amendments for government loan with a below-market  rate of interest when transitioning to IFRSs	1 January 2013
IFRS 10	Original issue Amendments to transitional guidance	1 January 2013 1 January 2013
IFRS  11	Joint Arrangements Amendments to transitional guidance	1 January 2013
IFRS 12	Disclosure of interests in other entities Amendments to transitional guidance	1 January 2013 1 January 2013
IFRS 13	Fair value measurement	1 January 2013
IAS 1	Presentation of Financial Statements - Amendments to revise the way other comprehensive income is presented	1 July 2012
IAS 19	Employee Benefits - Amended Standard resulting from the Post- Employment Benefits and Termination Benefits projects	1 January 2013
IAS 27	Separate financial statements	1 January 2013
IAS 28	Investments in associates and joint ventures	1 January 2013
IFRIC 20	Stripping Costs in the Production Phase of a Surface Mine	1 January 2013

The adoption of these standards has not had a material effect on the financial statements of the group.

2.       Loss per share

The calculation of the basic and diluted loss per share is based on the following data:

	30 June 13	30 June 12	31 December 12
	£	£	£
Loss after taxation	(300,299)	(319,070)	(643,488)
The weighted average number of shares in the period were
Basic ordinary shares	4,591,716,643	4,281,381,240	4,380,642,635
Basic and diluted loss per share (pence)	(0.007)	(0.007)	(0.01)

The loss attributable to equity shareholders and weighted average number of ordinary shares for the purposes of calculating diluted earnings per ordinary share are identical to those used for basic earnings per ordinary share. This is because the exercise of share options and warrants would have the effect of reducing the loss per ordinary share and is therefore anti-dilutive.

3.       Dividends

No dividends are proposed for the six months ended 30 June 2013 (six months ended 30 June 2012 £nil: year ended 31 December 2012 £nil).

4.       Intangible  assets

	Exploration and evaluation assets
	Javan Licences	Tanzanian Licences	Goodwill	Total
	£	£	£	£
Cost or valuation
As at 1 January 2013	36,536	9,126,958	1,252,869	10,416,363
Additions	-	190,679	-	190,679
Foreign exchange adjustment	-	573,908	77,389	651,297
At 30 June  2013	36,536	9,891,545	1,330,258	11,258,339
Accumulated amortisation and impairment
As at 1 January 2013	36,536	-	-	36,536
As at 30 June 2013	36,536	-	-	36,536
Net book value
As at 30 June 2013	-	9,891,545	1,330,258	11,221,803

4.            Intangible  assets (continued)

	Exploration and evaluation assets
	Javan Licences	Tanzanian Licences	Goodwill	Total
	£	£	£	£
Cost or valuation As at 1 January 2012	36,536	8,144,976	1,309,631	9,491,143
Additions	-	187,137	-	187,137
Fair value adjustment	-	-	(223)	(223)
Foreign exchange adjustment	-	(86,971)	(13,359)	(100,330)
At 30 June 2012	36,536	8,245,142	1,296,049	9,577,727
Accumulated amortisation and impairment
As at 1 January	36,536	-	-	36,536
As at 30 June 2012	36,536	-	-	36,536
Net book value
As at 30 June 2012	-	8,245,142	1,296,049	9,541,191

4.         Intangible assets (continued)

	Exploration and evaluation assets
	Javan Licences	Tanzanian Licences	Goodwill	Total
	£	£	£	£
Cost or valuation As at 1 January 2012	36,536	8,144,976	1,309,631	9,491,143
Additions	-	1,370,387	-	1,370,387
Foreign exchange adjustment	-	(388,405)	(56,762)	(445,167)
At 31 December 2012	36,536	9,126,958	1,252,869	10,416,363
Accumulated amortisation and impairment
As at 1 January 2012	36,536	-	-	36,536
As at 31 December 2012	36,536	-	-	36,536
Net book value
As at 31 December 2012	-	9,126,958	1,252,869	10,379,827

The outcome of ongoing exploration and evaluation, and therefore whether the carrying value of exploration and evaluation assets will ultimately be recovered, is inherently uncertain.  The directors have assessed the value of exploration and evaluation expenditure carried as intangible assets.  In their opinion there has been no impairment loss to intangible exploration and evaluation assets in the period.

5.       Share capital

		No.	£
30 June 2013
Allotted, called up and fully paid
Ordinary shares of 0.02p each		4,624,216,406	924,844
Deferred shares of 0.08p each		64,179,932	51,344
			976,188
30 June 2012
Allotted, called up and fully paid
Ordinary shares of 0.02p each		4,446,216,405	889,244
Deferred shares of 0.08p each		64,179,932	51,344
			940,588
31 December 2012
Allotted, called up and fully paid
Ordinary shares of 0.02p each		4,571,216,405	914,244
Deferred shares of 0.08p each		64,179,932	51,344
			965,588

On 22 April 2013 the company issued 53,000,000 ordinary shares of 0.02p each for a total consideration of £106,895.

6.       Distribution on interim report to shareholders

The interim report will be available for inspection by the public at the registered office of the company during normal business hours on any weekday and from the Company's website http://www.edenville-energy.com/. Further copies are available on request.

 

END

 

 

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