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D1 Oils Plc (NEOS)

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Thursday 23 September, 2010

D1 Oils Plc

Half Yearly Report

RNS Number : 1523T
D1 Oils Plc
23 September 2010
 



 

 

 

D1 Oils plc

 

23 September 2010

 

Press Release

 

D1 Oils plc today announces its interim results for the six months ended 30 June 2010.

 

Chairman and Chief Executive Officer's Report

 

Overview

 

D1 Oils plc is an alternative energy crop company. We are pioneering the development of Jatropha curcas, a robust, tropical oilseed bearing tree, into a new sustainable energy crop that has the potential to replace food crops as a source of biodiesel. Jatropha is a hardy crop that is able to grow on a wide range of soils, including soils which are sub-optimal for arable agriculture. Its grain is crushed to produce inedible oil that can be used directly or as a feedstock for biodiesel and a meal that has the potential to be processed into a high-value, protein source for animal feed. We have a long established plant science programme for Jatropha, and as well as using this to inform our own activities we provide commercial technology and services to the emerging Jatropha sector, including the breeding and selection of Jatropha seeds and seedlings, the development of planting practices and husbandry methods, and the harvesting and processing of Jatropha oil and meal.

 

Through our efforts in recent years, many farmers across India, Africa and Asia have been encouraged to plant Jatropha and advised on how to farm the crop towards maturity.  We have contracts with these farmers and we purchase the crop from them, at the prevailing market price, as they harvest and prepare the grain to our specification. The D1 Oils plc group ("D1" or "the Group") does not own this land or the crops growing on the land, it owns a relationship with the farmer. We organise the quality assurance; the collection; transportation and processing of the grain as well as sales and distribution of the resultant oil and meal. The network that facilitates this is scaled up in line with actual harvest and we are selling ever increasing quantities of oil and meal in all of our operational geographies. A natural consequence is a seasonal working capital financing requirement for inventories of grain and oil in transit. We sell oil to both local and export clients; whilst all meal sales are local.

 

In addition, we continue to invest in a research and development programme designed to generate know-how and technology to enhance the economics of both existing and future generations of Jatropha planting through improved, selected planting material; through ever improving, Jatropha specific agronomic practices; and through processes to improve the value of the meal.

 

This is an ambitious but achievable plan with many challenges yet to face and further funding still required, but we remain convinced of the commercial potential of Jatropha and determined to create a sustainable business for ourselves and our farmers. To date in 2010, D1 has continued to make progress in line with its operational plan despite the substantial uncertainties, distractions and direct financial costs incurred due to the ongoing Offer Period and the events leading up to the Requisitioned General Meeting on Board composition.

 

Corporate activities

 

Funding position

 

The Group business plan requires further funding to see the business through to a point where it is cash generative. The current business plan was originally formulated in mid-2009 following the re-integration of operations of the former D1-BP joint venture and has been subject to some subsequent revision. The plan envisaged operating until late 2011 using existing cash reserves and achieving a variety of milestones, such as oil sales targets, to give the business the best possible chance of successfully raising additional funds.

 

Today, the Group continues on the basis that it will seek to raise funds during 2011, or earlier if it is able to, although the Offer Period discussed below is another potential alternative. Typical equity fundraising avenues for the business require the support of 75% of shareholders who vote. The Directors are mindful that the differing perspectives of the major D1 shareholders continue to make it challenging to straightforwardly address the funding issue. However, the Directors are determined to work with shareholders to achieve a solution.

 

Offer period

 

D1 remains in the Offer Period which commenced in November 2009 following approaches by several parties potentially interested in acquiring some or all of the share capital of D1 Oils plc. As talks progressed, one bidder, Mission NewEnergy, was identified, along with an in principle price, subject to due diligence. In August 2010, Mission NewEnergy announced it was withdrawing from talks because, despite support from several substantial D1 shareholders, a major shareholder of D1 representing 28% of issued capital, Principle Capital, would not support the proposed offer. The Offer Period remains open due to continuing interest in the Group.

 

Requisitioned General Meeting

 

In May 2010, a general meeting was requisitioned by the representative of Principle Capital to seek to replace a majority of the Board with two nominees of Principle Capital. Following an adjournment of the general meeting to 19 July 2010, the proposed resolutions were rejected by a wide margin and the existing Board members retained.

 

Sale of Bromborough site

 

In February 2010, the Group exchanged contracts for the sale of the remaining refining site at Bromborough. Despite delays announced in July 2010, the Group completed the sale of the site in July 2010 for consideration of £2.2m, of which £1.8m was received up front and an additional £0.4m is due to be received in the fourth quarter of 2010 when the purchaser recovers VAT on the purchase. In addition, an associated royalty arrangement was agreed based on future production volumes of biodiesel. The buyer also assumed responsibility under a new sub-lease for the Group's leasehold obligations at the Bromborough site for the remaining 12 year term.  The receipt of cash from the sale of the site ticked off a critical milestone for short-term funding of the business.

 

Business activities

 

Operations group

 

The Operations group is responsible for managing relationships with outgrower farmers, collecting grain and processing it into crude Jatropha oil ("CJO") and co-products. D1's key value proposition in the medium term is the prospect of sourcing large quantities of oil through the existing plantations of outgrower farmers.

 

Our forecast for oil production from this year's harvest remains on track at approximately 2,000 tonnes; although it should be noted that the vast majority of the harvest will be collected from September 2010 to January 2011 simply because of the crop cycle. This will largely come from India, where this year's monsoon has in general been favourable, There are encouraging quantities of fruit on trees, ready for harvest in two of our major collection areas (North West and Central India) although this is counter-balanced by disappointing early signs in North East India where excessive rains, the heaviest in 30 years, have depressed flowering and also driven farmers from the fields leading to problems with weed clearance. On balance however we remain confident. 

 

Preparations for this year's harvest are well advanced in Central India, with an escalation of the grain collection arrangements successfully trialled last year. In addition we have renegotiated the contract with our toll expeller, which should achieve a 40% reduction in unit crush costs compared to last year.

 

We are consistently selling meal, to repeat customers, in India at approximately US$110/tonne, a price which significantly exceeded our original expectations and which we now expect to match in the coming season.

 

In September we have sold 150T of CJO at prices well in excess of last year.

 

Based on these developments, and having cleared all of our CJO and meal stocks already in September, we are anticipating selling oil out of India at significantly improved margins compared to our experience to date.

 

In addition, our joint venture with Williamson-Magor in north east India continues to make progress in securing revenues from government-sponsored planting programmes.

 

Science and Technology group

 

The Science and Technology group is responsible for improving our agronomy knowledge, the breeding and cultivar programme and developing a commercial process to turn Jatropha seedcake into a constituent of animal feed. The highlights of the programme were:

 

·      Animal feed. We successfully concluded our poultry feeding trial, following last year's successful small mammal trial. Initial analysis indicates no deleterious health effects and weight gains apparently superior to the control group, fed on soya meal. Later this year we plan to process up to 10 tonnes of grain as an input to feeding trials on cattle. We are also working with the FDA in the US to validate our product as a high protein animal feed.

 

·      Breeding. Eight cultivars, selected for yield performance, have progressed into commercial scale production of planting seed. 

We have now sold quantities of selected seed in Africa, India and South East Asia. Current stocks of this next generation of selected seed are sufficient for 18,000 hectares of planting.  We have also identified further new accessions for the next phase of breeding. These each have valuable attributes such as: high fruit counts per tree, high grain oil contents (>40%wt) and one with a resistance to one of Jatropha's most significant insect pests.  In our F1 hybrid programme we are currently producing and testing the first 20 genuine F1 hybrids and expect the first results from this early next year. A successful F1 hybrid programme would result in higher oil yields from these seeds.

 

·      Agronomy research. Recent results continue to refine agronomy techniques.  For example, first season yield improvements for best practice compared to average were 82% in canopy management trials and 23% in multi-factorial fertiliser trials. Learnings from such trial work and from field surveys is used to regularly refine and update our Agronomy Manuals - our method of passing on the results of our R&D effort to the officers in the field, who take the material and adapt it for local training sessions with farmers.

 

Business Development group

 

The Business Development group is responsible for the marketing of the Group's plant science consulting services, selling of crude Jatropha oil and its co-products and sourcing grant funding.

 

Over the past year we have seen clear evidence of a significant appetite for new sources of vegetable oils, as well as strong underpinning prices for conventional vegetable oils. However, our recent progress in securing knowledge-based revenues has been disappointing. Our objective for these revenues was for them to pass our rate of research and development expenditure in 2011; however, this is unlikely to be achieved in the foreseeable future, in large part due to the impact of recent business uncertainty on customer confidence. We are reviewing our level of research and development expenditure based on our revised expectations of knowledge-based revenues.

 

Finance

 

Group revenue from continuing operations was £0.1m (June 2009: £1.5m). Note, the June 2009 comparatives reflect the period when the D1 Oils plc group was providing the D1-BP Fuel Crops joint venture with plant science services. In July 2009, D1 acquired BP's share of the joint venture resulting in the merger of activities and the cessation of the plant science fee charged from D1 to the D1-BP Fuel Crops joint venture. The net loss from continuing operations was £3.7m (June 2009: £2.8m). The increased loss compared to June 2009 reflects the transition of the business from supporting the D1-BP joint venture to a stand-alone business undertaking both plantation and plant science activities.

 

The net profit from discontinued operations of £0.6m (June 2009: loss of £0.1m) is a result of the final activities to wind up the Group's refining and trading operations and the release of associated provision that is no longer required. In early July 2010, the Group sold its remaining refining and trading site at Bromborough for consideration of £2.2m, of which £1.8m was received up front and an additional £0.4m is due to be received when the purchaser recovers VAT on the purchase. In addition, an associated royalty arrangement was agreed based on future production volumes of biodiesel, although, due to uncertainties in timing and amount, no asset is recognised for this royalty.

 

The overall loss for the period was £3.1m (June 2009: £2.9m). The basic and diluted loss per share was 2.45p (June 2009: 2.31p).

 

The Group's cash and cash equivalents and term deposits at 30 June 2010 were £5.5m (June 2009: £8.4m). The Group's cash position was bolstered in early July 2010 by the proceeds of the Bromborough sale.

 

Outlook

 

In the second half of 2010 we will continue to work hard on two fronts. On an operational front, the major aim is to collect and process the forecast quantities of grain in India; sell the resultant CJO to a satisfied customer base and hit our scientific milestones, particularly in relation to animal feed. On a corporate front, we will continue to work with our shareholders to determine the future strategy, structure and funding of the business.

 

 

 

 

 

Barclay Forrest

Non-Executive Chairman

 

 

 

 

 

Martin Jarvis

Chief Executive Officer

 

22 September 2010

 

 

 

 

Consolidated interim income statement

unaudited results for the six months ended 30 June 2010

 

 



Six months

Six months

Year



ended

ended

ended



30 June

30 June

31 December



2010

2009

2009



Unaudited

Unaudited

Audited


Note

£000

£000

£000

Group revenue

2

102.1

1,537.3

1,797.3

Cost of sales


(67.2)

(1,359.2)

(1,450.7)

Gross profit


34.9

178.1

346.6

Administrative expenses


(3,557.7)

(3,197.8)

(7,947.6)

Trading loss


(3,522.8)

(3,019.7)

(7,601.0)

Share of post-tax losses of joint ventures accounted for using the equity method


(209.6)

-

(95.0)

Impairment of investments


-

-

-

Net gain on transfer of operation from joint venture


-

-

2,750.6

Group operating loss from continuing operations


(3,732.4)

(3,019.7)

(4,945.4)

Finance income


128.6

229.5

667.5

Finance costs


(128.0)

-

(23.0)

Loss for the period from continuing operations before taxation


(3,731.8)

(2,790.2)

(4,300.9)

Tax credit/ (expense)


6.8

(18.1)

123.8


(3,725.0)

(2,808.3)

(4,177.1)






Discontinued operations





Profit/(loss) for the period from discontinued operations

3

628.2

(107.7)

(912.9)


(3,096.8)

(2,916.0)

(5,090.0)






Loss for the period attributable to equity holders of the parent


(3,096.8)

(2,916.0)

(5,090.0)






Loss per ordinary share





Basic and diluted loss per ordinary share (pence)

4

(2.45)

(2.31)

(4.03)

4

(2.95)

(2.22)

(3.30)

 



 

 

Consolidated interim statement of comprehensive income

unaudited results for the six months ended 30 June 2010

 



Six months

Six months

Year



ended

ended

ended



30 June

30 June

31 December



2010

2009

2009



Unaudited

Unaudited

Audited



£000

£000

£000

Loss for the period


(3,096.8)

(2,916.0)

(5,090.0)

Exchange difference on retranslation of foreign operations


71.6

-

62.3

Transfer of foreign exchange reserves to income statement


-

(29.2)

-

Total recognised income and expense for the period


(3,025.2)

(2,945.2)

(5,027.7)

Attributable to:





Equity holders of the parent


(3,025.2)

(2,945.2)

(5,027.7)

 

 


Consolidated interim statement of changes in equity

unaudited results for the six months ended 30 June 2010

 

 

 




Own



Share

Currency



Share

Share

shares

Merger

Revenue

option

translation



capital

premium

held

reserve

reserve

reserve

reserve

Total


Unaudited

Unaudited

Unaudited

Unaudited

Unaudited

Unaudited

Unaudited

Unaudited


£000

£000

£000

£000

£000

£000

£000

£000

At 1 January 2009

1,266.3

99,290.3

(484.0)

437.7

(100,079.8)

12,787.0

29.2

13,246.7

Total recognised income and expense

-

-

-

-

(2,945.2)

-

(29.2)

(2,974.4)

Share-based payments

-

-

-

-

280.9

-

-

280.9

At 1 July 2009

1,266.3

99,290.3

(484.0)

437.7

(102,744.1)

12,787.0

-

10,553.2

Total recognised income and expense

0.5

-

-

-

10,423.5

(11,762.0)

(33.1)

(1,371.1)

Share-based payments

-

-

-

-

401.0

-

-

401.0

At 1 January 2010

1,266.8

99,290.3

(484.0)

437.7

(91,919.6)

1,025.0

(33.1)

9,583.1

Total recognised income and expense

-

-

-

-

(3,025.2)

-

(71.6)

(3,096.8)

Share-based payments

-

-

-

-

78.0

-

-

78.0

At 30 June 2010

1,266.8

99,290.3

(484.0)

437.7

(94,866.8)

1,025.0

(104.7)

6,564.3

 

 

Consolidated interim balance sheet

unaudited results as at 30 June 2010

 



As at

As at

As at



30 June

30 June

31 December



2010

2009

2009



Unaudited

Unaudited

Audited


Note

£000

£000

£000

Assets





Non-current assets





Property, plant and equipment


310.3

371.2

399.2

Biological assets


23.2

-

-

Intangible assets


0.6

3.1

2.5

Investments accounted for using the equity method


-

-

206.1



334.1

374.3

607.8

Current assets





Inventories


160.9

18.8

100.9

Trade and other receivables


958.2

1,849.3

1,233.1

Other financial assets

5

4,116.7

-

4,547.6

Cash and short-term deposits


1,424.9

8,408.0

4,425.5



6,660.7

10,276.1

10,307.1

Assets held for resale

3

2,076.0

3,132.9

2,124.0

Total assets


9,070.8

13,783.3

13,038.9






Equity and liabilities





Current liabilities





Trade and other payables


(267.3)

(907.0)

(623.2)

Interest-bearing loans and borrowings


-

(690.0)

-

Accruals and deferred income


(739.7)

(448.2)

(552.2)

Payments due to vendors


(53.9)

-

(51.0)

Other financial liabilities


(92.8)

(0.8)

-

Provisions


(895.5)

(1,184.1)

(1,796.5)



(2,049.2)

(3,230.1)

(3,022.9)

Non-current liabilities





Payments due to vendors


(457.3)

-

(432.9)



(457.3)

-

(432.9)

Total liabilities


(2,506.5)

(3,230.1)

(3,455.8)

Net assets


6,564.3

10,553.2

9,583.1



 



Capital and reserves


 



Equity share capital


1,266.8

1,266.3

1,266.8

Share premium


99,290.3

99,290.3

99,290.3

Own shares held


(484.0)

(484.0)

(484.0)

Other reserves


437.7

437.7

437.7

Revenue reserves


(94,866.8)

(102,744.1)

(91,919.6)

Share option reserve


1,025.0

12,787.0

1,025.0

Currency translation reserve


(104.7)

-

(33.1)

Equity shareholders' funds


6,564.3

10,553.2

9,583.1

 

Consolidated interim statement of cash flows

unaudited results for the six months ended 30 June 2010

 

 



Six months

Six months

Year



ended

ended

ended



30 June

30 June

31 December



2010

2009

2009



Unaudited

Unaudited

Audited



£000

£000

£000

Operating activities





Loss for the period


(3,096.8)

(2,916.0)

(5,090.0)

Adjustments to reconcile loss for the period to net cash flow from operating activities:





Depreciation of property, plant and equipment, and amortisation of intangible assets


92.2

84.9

217.4

Impairment of fixed assets


56.3

8.9

64.8

Share-based payments


78.0

281.0

401.0

Net gain on transfer of operation from joint venture


-

-

(2,750.6)

Loss/(profit) on disposal of fixed assets


7.1

21.9

52.9

Share of post-tax losses of joint ventures accounted for using the equity method


209.6

-

95.0

Finance income


(128.6)

(634.5)

(1,072.5)

Finance expense


128.0

61.7

104.3

Income tax expense


(6.8)

(29.8)

(171.6)

Tax paid


6.8

15.0

189.5

Decrease/(increase) in inventories


(60.0)

1.5

(20.9)

Decrease/(increase) in trade and other receivables


274.9

(929.7)

218.8

Increase/(decrease) in trade and other payables


(168.4)

(923.9)

(2,979.3)

Increase/(decrease) in provisions


(901.0)

(4,616.9)

(4004.5)

Net cash flow from operating activities


(3,508.7)

(9,575.9)

(14,745.7)

Investing activities





Interest received


28.8

275.3

310.4

Payments to acquire property, plant and equipment, and intangible assets


(36.4)

(10.0)


Funds transferred to deposits


514.0

4,986.3

861.0

Purchase of joint venture investments


(11.4)

-

-

Net cash acquired from acquisitions


-

-

4,993.1

Proceeds from disposal of assets held for sale


-

-

953.0

Net cash flow from investing activities


495.0

5,251.6

7,056.5

Financing activities





Interest paid


-

(61.7)

(81.3)

Exercise of share options


-

-

0.5

Settlement of leases and mortgages


-

-

(2,661.7)

Repayment of mortgage


-

(30.0)

(30.0)

Repayment of capital elements of finance leases


-

(2,161.8)

(190.1)

Net cash flow from financing activities


-

(2,253.5)

(2,962.6)

Net increase/(decrease) in cash and cash equivalents


(3,013.7)

(6,577.8)

(10,651.9)

Cash and cash equivalents at the start of the period


4,425.5

15,055.9

15,055.9

Effects of exchange rates on cash at the start of the period


13.1

(70.1)

21.5

Cash and cash equivalents at the end of the period


1,424.9

8,408.0

4,425.5

 

 

Notes to the interim financial statements

 

1. Basis of preparation

 

This interim report, which does not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006, was approved by the Board on 22 September 2010. The condensed set of financial statements of this interim report has been prepared in accordance with accounting policies which will be adopted in presenting the full year annual report and accounts for the year ending 31 December 2009.

 

The full year annual report and accounts will be prepared in accordance with International Financial Reporting Standards ("IFRSs") as adopted by the European Union. The Group has not applied IAS 34 Interim Financial Reporting in the preparation of these condensed interim financial statements, as it is not mandatory for AIM-listed companies.

 

The financial information for the full preceding year does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006 and has been extracted from the statutory accounts for the financial year ended 31 December 2009 which have been delivered to the Registrar of Companies. Those accounts, which included an auditors' report which contained a 'disclaimer on view' qualification, did not contain a statement under Section 498(2) nor Section 498(3).

 

Fundamental accounting concept

 

The financial statements have been prepared on a going concern basis which assumes that the Company and the Group will continue in operating existence for the foreseeable future and meet its liabilities as they fall due. There are uncertainties that the Directors have had to consider in deciding to prepare the financial statements on the going concern basis which are set out below.

 

Funding uncertainty

The Directors have prepared cash flow forecasts which show the Group will need to raise new funds in 2011. The key assumptions underlying these forecasts include maintaining the existing operations at the current rate of cash outflow, local borrowings to fund some working capital requirements in India, and generating cash inflow from the sale of Jatropha oil, by-products and technical services. The cashflow forecasts approved by the Board of Directors take into account various sensitivities and risks, including underperformance against expectations in individual areas. The Directors have also considered mitigation steps available to absorb some underperformance. As might be expected, the timing of future fundraising may need to be accelerated if certain anticipated cash inflows from asset sales or revenue generation are delayed or costs are higher than forecast.  

 

In order to raise new equity, the business needs to ensure that it has made sufficient progress in demonstrating Jatropha as a new energy crop with sufficient oil flow, and thereafter it is able to achieve profitability and be cash generative over the longer term.

 

Transaction uncertainty

The Company is in an offer period. There can be no certainty that an offer will be made or that any offer made will be on acceptable terms. Furthermore, the implication of any potential transaction on the business itself cannot be assessed at this stage.

 

Directors' view

After making enquiries and considering these uncertainties, the Directors conclude that the issue of whether the Company can maintain positive cash resources until funds to continue implementation of the Group's business plan are secured and address the transaction challenges are material uncertainties which may cast significant doubt about the Group and Company's ability to continue as a going concern in its current form. The Directors believe that these uncertainties can be managed and mitigated and the Directors have a reasonable expectation that the Group and the Company have adequate resources to continue in operational existence for the foreseeable future. Consequently the Directors believe that it is appropriate to prepare the financial statements on a going concern basis. 

 

Should management significantly underachieve the targets set out above and cash resources be depleted before an additional injection of funds, or the strategy be changed in a way which restricts the Group's ability to implement the business plan, then the going concern basis would be invalid and adjustments may have to be made to reduce the value of the assets to their recoverable amount, to provide for any further liabilities which might arise and to reclassify fixed assets and long term liabilities to current assets and current liabilities.

 

Significant accounting policies

 

The accounting policies adopted in the preparation of the Group's interim financial statements are consistent with those followed in the preparation of the annual financial statements for the year ended 31 December 2009, except for the adoption of new Standards and Interpretations as of 1 January 2010 listed below:

·      IFRS 2 - Amendment to IFRS 2 - Group Cash-settled Share-based Payments. The amendments clarified the classification of share-based payment awards in parent and subsidiary companies and addressed plans not considered in the original Standard. The adoption of this amendment has not had a material impact on the financial position or performance of the Group.

The amendments to the following standards did not have any impact on the accounting policies, financial position or performance of the Group:

·      IFRS 1 - Additional Exemptions for First-time Adopters - effective 1 January 2010.

·      IAS 39 - Eligible Hedged Items - effective 1 July 2009.

·      IFRIC 17 - Distribution of Non-cash Assets to Owners - effective 1 July 2009.

·      IFRIC 18 - Transfers of Assets from Customers - effective in EU no later than 1 January 2010.

·      Various - Annual improvements to IFRS - effective various dates but most 1 January 2010.

 

2. Segmental information

The Group operates in a number of different business segments. An analysis of the revenue and operating profit for each segment for the financial period is set out below.

Following the integration of the former D1-BP joint venture operations into the Group in the second half of 2009, the Group's segments were revised to reflect the business structure adopted. Comparatives for the periods ending 30 June 2009 and 31 December 2009 are restated to reflect the revised segments. Descriptions of the segments are contained in the Chairman and Chief Executive's Report.


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


£000

£000

£000

Revenue




Business Development

86.7

-

169.0

Operations

15.4

-

33.7

Science and Technology

-

1,537.3

1,594.6

UK Refining and Trading (discontinued operation)

-

1.7

1.7

Group total

102.1

1,539.0

1,799.0

Loss




Business Development

(237.1)

-

(31.0)

Operations

(766.6)

-

(1,241.6)

Science and Technology

(1,044.2)

(833.3)

(2,782.7)

UK Refining and Trading (discontinued operation)

628.2

(107.7)

(912.9)


(1,419.7)

(941.0)

(4,968.2)

Corporate

(1,677.1)

(1,975.0)

(2,872.4)

Net gain on transfer of operation from joint venture

-

-

2,750.6

Group total

(3,096.8)

(2,916.0)

(5,090.0)

 

3. Discontinued operations

 

In April 2008, the Group announced the decision of its Board to cease biodiesel refining and trading operations. The two refining sites at Middlesbrough and Bromborough in the UK were closed. Closure of these businesses resulted in the sites and refining equipment being reclassified from plant, property and equipment to assets held for sale. In June 2009, the sale of the Middlesbrough site was completed. At 30 June 2010, the Bromborough site was classified as an asset held for sale. On 2 July 2010, the sale of the Bromborough site was completed.


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


£000

£000

£000

Revenue

-

1.7

1.7

Administrative expenses (a)

676.2

(500.6)

(1,221.4)

Trading loss

676.2

(498.9)

(1,219.7)

Asset impairment

(48.0)

-

(64.8)

Group operating loss from discontinued operations

628.2

(498.9)

(1,284.5)

Finance income

-

405.0

405.0

Finance costs

-

(61.7)

(81.3)

Loss from discontinued operations before taxation

628.2

(155.6)

(960.8)

Tax expense

-

47.9

47.9

Loss for the period from discontinued operations

628.2

(107.7)

(912.9)

 

(a) Administrative expenses includes the reversal of an onerous contracts provision in relation to the Bromborough site.

 

Loss per ordinary share                                                                                                                                                             


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


Number

Number

Number

Weighted average number of shares in issue

126,481,574

126,431,574

126,438,697






Pence

Pence

Pence

Basic and diluted loss per ordinary share from discontinued operations

0.50

(0.09)

(0.70)

The number of shares in issue at 31 December 2009 and at 30 June 2010 was 126,675,219. For the purposes of calculating the loss per ordinary share the weighted average number of shares excludes 193,645 shares held by the D1 Oils plc Employee Benefit Trust. The diluted loss per share doesn't differ from the basic loss per share as the share options are anti-dilutive.

 

For the purposes of calculating earnings per share, the following profit figures were used:


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


£000

£000

£000

Loss for the period attributable to equity holders of the parent from discontinued operations

628.2

(107.7)

(912.9)

 

The carrying value of assets held as available for sale is set out below:


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


£000

£000

£000

Property

1,960.9

3,000.0

2,000.0

Environmental insurance prepayment

115.1

132.9

124.0

Assets classified as available for sale

2,076.0

3,132.9

2,124.0

 

 

4. Loss per ordinary share


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


Number

Number

Number

Weighted average number of shares in issue

126,431,574

126,431,574

126,438,697






Pence

Pence

Pence

Basic and diluted loss per ordinary share for the period

(2.45)

(2.31)

(4.03)

Basic and diluted loss per ordinary share from continuing operations

(2.95)

(2.22)

(3.30)

The number of shares in issue at 31 December 2009 and at 30 June 2010 was 126,675,219. For the purposes of calculating the loss per ordinary share the weighted average number of shares excludes 193,645 shares held by the D1 Oils plc Employee Benefit Trust. The diluted loss per share doesn't differ from the basic loss per share as the share options are anti-dilutive.

For the purposes of calculating earnings per share, the following profit figures were used:


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


£000

£000

£000

Loss for the period attributable to equity holders of the parent from continuing operations

(3,725.0)

(2,808.3)

(4,177.1)

Loss for the period attributable to equity holders of the parent from discontinued operations

628.2

(107.7)

(912.9)

Total loss for the period attributable to equity holders of the parent

(3,096.8)

(2,916.0)

(5,090.0)

 

5. Other financial assets

Other financial assets comprises the following:


Six months

Six months

Year


ended

ended

ended


30 June

30 June

31 December


2010

2009

2009


Unaudited

Unaudited

Audited


£000

£000

£000

Other cash deposits

4,104.4

-

4,534.1

Accrued bank interest

12.3

-

13.5


4,116.7

-

4,547.6

 

6. Contingent liabilities

As part of the sale of the Bromborough site, the purchaser was also assigned two leases for land adjacent to the site.  If the purchaser defaults on the lease payments, the liability may revert to D1 Oils plc.  The maximum exposure at 30 June 2010 is £2.0m.  Should this exposure crystallise, the liability could be mitigated by sub-letting the land.

 

7. Post balance sheet events

On 2 July 2010, the Group sold the Bromborough site that was part of the discontinued refining and trading operations. The sale price less selling costs were equal to the value of the asset held for sale at 30 June 2010 of £2.1m.

 

8. Approval by the Board of Directors

The Interim Report was approved by the Board of Directors on 22 September 2010.

 

 

Directors and advisors

 

 

Barclay Forrest OBE, FRAgs

Non-Executive Chairman

 

 

 

 

Company Secretary

Marie Edwards

 

Martin Jarvis

Chief Executive Officer

 

Registered office

1 Park Row
Leeds

LS1 5AB

Dr Henk Joos

Plant Science Director

 


Registered number

5212852

 


Broker and nominated advisor

Piper Jaffray Ltd

One South Place

London EC2M 2RB

 



Bankers

Barclays Bank plc

PO Box 378
71 Grey Street
Newcastle upon Tyne NE99 1JP

 



Auditors

Ernst & Young LLP

Citygate
St James' Boulevard
Newcastle upon Tyne NE1 4JD

 



Solicitors

Pinsent Masons
CityPoint
One Ropemaker Street

London EC2Y 9AH

 


Registrars

Capita IRG plc

The Registry
34 Beckenham Road
Kent BR3 4TU

 

 

 

 

For further information please contact: 

D1 Oils plc

+ 44 (0) 20 7936 9115

Martin Jarvis, Chief Executive Officer






Piper Jaffray Ltd.

+ 44 (0) 20 3142 8700      

Charlie Lilford


Rupert Winckler (Qualified Executive)




Brunswick Group

+ 44 (0) 20 7404 5959            

Kevin Byram


Saadia McGlinchey


 

Piper Jaffray Ltd., which is authorised and regulated by the Financial Services Authority, is acting exclusively for D1 Oils and for no-one else in connection with the matters referred to in this announcement and will not be responsible to anyone other than D1 Oils for providing the protections afforded to customers of Piper Jaffray Ltd. nor for giving advice in relation to the matters referred to in this announcement.

Responsibility

The Directors of D1 Oils accept responsibility for all of the information contained in this announcement.  To the best of their knowledge and belief (having taken all reasonable care to ensure that such is the case), the information contained in this announcement is accurate and does not omit anything likely to affect the import of such information.  To the best of their knowledge and belief (having taken all reasonable care to ensure that such is the case), the information contained in this announcement for which the Directors take responsibility is accurate and does not omit anything likely to affect the import of such information.


Disclosure requirements of the Takeover Code (the "Code")

Under Rule 8.3(a) of the Code, any person who is interested in 1% or more of any class of relevant securities of D1 Oils or of any paper offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement in which any paper offeror is first identified.

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) D1 Oils and (ii) any paper offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement in which any paper offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a paper offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1% or more of any class of relevant securities of the offeree company or of any paper offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any paper offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any paper offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a paper offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4). Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. If you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure, you should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129.

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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