Half-yearly results For the period ended 30 June 2

Companies

Capital Limited (DI) (CAPD)

UK 100

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Results	H1 2011	*H1 2010	Change %
Revenue $m	59.5	28.7	107.0
EBITDA $m	16.3	7.2	127.8
EBITDA %	27.5	25.0	10.1
EBIT $m	11.2	4.7	139.3
EBIT %	18.8	16.3	15.6
NPAT $m	8.6	3.5	144.9
NPAT %	14.5	12.2	18.3
Basic EPS (cents)	6.4	3.4	85.8
Diluted EPS (cents)	6.4	3.1	105.5

Balance Sheet	H1 2011 $m	FY 2010 $m	Change %
Non-Current Assets	54.4	48.2	12.9
Current Assets	51.5	48.4	6.2
Total Assets	105.8	96.6	9.6
Non-Current Liabilities	10.0	12.8	(22.1)
Current Liabilities	25.9	22.4	15.4
Total Liabilities	35.8	35.2	1.7
Equity	70.0	61.4	14.1
Cash	12.8	18.2	(30.0)
Debt	14.6	18.0	(18.9)
Net Cash (Debt)	(1.9)	0.2	-
Gearing (net debt/equity)	2.7%	0.0%	-

Cash Flow	H1 2011 $m	H1 2010 $m
Operating Activities
Net cash generated from operating activities	9.5	1.3
Investing Activities
Net cash used in investing activities	(11.6)	(5.8)
Financing Activities
Changes in Shares and Premium	-	20.0
Increase (decrease) - Loans	(3.4)	1.4
Net cash (used in) generated from financing activities	(3.4)	21.4
Net increase (decrease) in cash	(5.5)	16.9
Closing cash balance	12.8	18.0

Capital Drilling
Jamie Boyton, Executive Chairman		+65 6227 9050
Brian Rudd, CEO


Liberum Capital Limited
Clayton Bush Richard Bootle		+44 (0)20 3100 2000




Canaccord Genuity Limited
Andrew Chubb Bhavesh Patel		+ 44 (0) 20 7050 6500

Buchanan		+44 (0)20 7466 5000
Bobby Morse Gabriella Clinkard

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 June 2011

		Six months ended

	Note	30/06/2011	30/06/2010
		$	$

Revenue		59,454,818	28,925,958

Cost of sales		(37,878,111)	(19,437,917)


Gross profit		21,576,707	9,488,041

Other income		19,017	1,078,352


Administration costs		(5,254,479)	(2,825,306)

Profit before depreciation, finance charges and taxation		16,341,245	7,741,087

Administration expenses - Depreciation		(5,149,231)	(2,496,313)

Total administration expenses		(10,403,710)	(5,321,619)



Profit from operations		11,192,014	5,244,774

Finance charges - net		(569,800)	(620,721)


Profit before taxation		10,622,214	4,624,053

Taxation		(2,028,894)	(547,720)


Profit for the period		8,593,320	4,076,333


Other comprehensive income:

Exchange differences on translation of foreign operations		(14,706)	380


Total comprehensive income for the period		8,578,614	4,076,713


Profit attributable to:

Equity holders of the parent		8,593,320	3,974,254
Non-controlling interest		-	102,079


Profit for the period		8,593,320	4,076,333


Total comprehensive income attributable to:

Equity holders of the parent		8,578,614	3,974,634
Non-controlling interest		-	102,079


Total comprehensive income for the period		8,578,614	4,076,713


Earnings per share:

Basic (cents per share)	4	6.4	4.0


Diluted (cents per share)	4	6.4	3.6

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
30 June 2011


	Notes	30/06/2011	31/12/2010
		$	$
ASSETS

Non-current assets
Property, plant and equipment	6	54,358,993	48,135,427
Deferred taxation		21,837	21,837


Total non-current assets		54,380,830	48,157,264


Current assets
Inventory		18,772,820	14,923,881
Trade and other receivables		19,560,729	14,965,800
Taxation		357,000	316,287
Cash and cash equivalents		12,773,111	18,237,254


Total current assets		51,463,660	48,443,222


Total assets		105,844,490	96,600,486


EQUITY AND LIABILITIES

Equity
Share capital	7	13,459	13,459
Share premium	7	21,561,190	21,561,190
Equity-settled employee benefits reserve		63,388	5,925
Foreign currency translation reserve		(47,179)	(32,473)
Retained earnings		48,414,992	39,821,672


Equity attributable to equity holders of the parent		70,005,850	61,369,773


Total equity		70,005,850	61,369,773


Non-current liabilities
Long-term liabilities	8	9,531,150	12,424,065
Deferred taxation		457,038	396,999


Total non-current liabilities		9,988,188	12,821,064


Current liabilities
Trade and other payables		19,667,584	16,166,954
Taxation		1,075,737	618,400
Current portion of long-term liabilities		5,107,131	5,236,505
Short-term loans	9	-	387,790


Total current liabilities		25,850,452	22,409,649


Total equity and liabilities		105,844,490	96,600,486

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2011

				Reserves
	Share capital	Share premium	Retained earnings	Equity-settled employee benefits reserve	Foreign currency translation reserve	Attributable to equity holders of the parent	Non-controlling interest	Total equity
	$	$	$	$	$	$	$	$

Balance at 1 January 2010	14,400	189,600	28,360,237	2,250,100	(11,024)	30,803,313	1,035,975	31,839,288

Exercise of shareholder share options	2,400	1,917,600	-	-	-	1,920,000	-	1,920,000
Exercise of executive share options	1,800	3,688,300	-	(2,250,100)	-	1,440,000	-	1,440,000
Repayment of capital	-	(2,500,000)	-	-	-	(2,500,000)	-	(2,500,000)
Acquisition of non-controlling interest	89	791,563	346,402	-	-	1,138,054	(1,138,054)	-
Effect of share split	(7,440)	7,440	-	-	-	-	-	-
Issue of shares	2,210	19,594,015	-	-	-	19,596,225	-	19,596,225
Share issue cost	-	(2,089,790)	-	-	-	(2,089,790)	-	(2,089,790)
Exchange differences on translation of foreign operations	-	-	-	-	380	380	-	380
Profit for the period	-	-	3,974,254	-	-	3,974,254	102,079	4,076,333


Balance at 30 June 2010	13,459	21,598,728	32,680,893	-	(10,644)	54,282,436	-	54,282,436



Balance at 31 December 2010	13,459	21,561,190	39,821,672	5,925	(32,473)	61,369,773	-	61,369,773

Equity-settled share based payment scheme	-	-	-	57,463	-	57,463	-	57,463
Exchange differences on translation of foreign operations	-	-	-	-	(14,706)	(14,706)	-	(14,706)
Profit for the period	-	-	8,593,320	-	-	8,593,320	-	8,593,320


Balance at 30 June 2011	13,459	21,561,190	48,414,992	63,388	(47,179)	70,005,850	-	70,005,850

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the six months ended 30 June 2011

		Six months ended

	Note	30/06/2011	30/06/2010
		$	$

Operating activities:

Cash from operations	10	11,633,713	2,470,884
Finance costs - net		(569,800)	(620,721)
Taxation paid		(1,552,231)	(582,469)


Net cash generated from operating activities		9,511,682	1,267,694


Investing activities:

Purchase of property, plant and equipment		(12,356,733)	(6,240,483)
Proceeds from disposal of property, plant and equipment		790,987	390,823


Net cash used in investing activities		(11,565,746)	(5,849,660)


Financing activities:

Exercise of shareholder share options		-	1,920,000
Exercise of executive share options		-	1,440,000
Repayment of capital		-	(800,000)
Issue of shares		-	19,596,225
Share issue cost		-	(2,089,790)
Decrease in executives' loans		-	(5,274,887)
Long-term liabilities raised		-	14,178,132
Long-term liabilities repaid		(3,022,289)	(4,914,436)
Short-term liabilities raised		-	806,062
Short-term liabilities repaid		(387,790)	(3,393,160)


Net cash (used in) generated from financing activities		(3,410,079)	21,468,146


Net (decrease) increase in cash and cash equivalents		(5,464,143)	16,886,180

Cash and cash equivalents at the beginning of the period		18,237,254	1,109,709


Cash and cash equivalents at the end of the period		12,773,111	17,995,889

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the six months ended 30 June 2011

1.	Basis of presentation and accounting policies
	Preparation of the condensed consolidated financial statements

	The condensed consolidated financial statements of Capital Drilling Limited and Subsidiaries ("Capital Drilling" or the "Group") as of and for the six months ended 30 June 2011 (the "Interim Financial Statements") have been prepared in accordance with International Accounting Standard ("IAS") No. 34, "Interim Financial Reporting". They should be read in conjunction with the annual consolidated financial statements and the notes thereto in the Group's Annual Report for the year ended 31 December 2010 which have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB"). The Interim Financial Statements are unaudited.

	Accounting policies

	The Interim Financial Statements have been prepared on a historical cost basis, except for certain financial instruments which are measured at fair value.

	The accounting policies used to prepare the Interim Financial Statements are the policies described in Note 3 of the consolidated financial statements for the year ended 31 December 2010.

	The Group adopted a number of new standards, amendments to standards or interpretations effective 1 January 2011 which are described in Note 2 of the consolidated financial statements for the year ended 31 December 2010. The adoption of these standards and interpretation did not have a material impact on the financial statements.

	On May 13, 2011 the IASB issued IFRS 10 "Consolidated Financial Statements", IFRS 11 "Joint Arrangements", IFRS 12 "Disclosure of Interests in Other Entities" and IFRS 13 "Fair Value Measurement", all effective for annual periods beginning on or after January 1, 2013.

	IFRS 10 "Consolidated Financial Statements" establishes principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities. It replaces the consolidation requirements in Standing Interpretations Committee Interpretation ("SIC") 12 "Consolidation - Special Purpose Entities" and IAS 27 "Consolidated and Separate Financial Statements".

	IFRS 11 "Joint Arrangements" provides a more substantive reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form. The standard addresses inconsistencies in the reporting of joint arrangements by requiring a single method to account for interests in jointly controlled entities.

	IFRS 12 "Disclosure of Interests in Other Entities" is a new and comprehensive standard on disclosure requirements for all forms of interests in other entities, including subsidiaries, joint arrangements, associates and unconsolidated structured entities.

	IFRS 13 "Fair Value Measurement" defines fair value and sets out in a single IFRS a framework for measuring fair value and requires disclosures about fair value measurements. It applies when other IFRSs require or permit fair value measurements. It does not introduce any new requirements to measure an asset or a liability at fair value, change what is measured at fair value in IFRSs or address how to present changes in fair value.

	On June 16, 2011 the IASB issued amendments to IAS 1 "Presentation of Financial Statements", effective for annual periods beginning on or after July 1, 2012 and to IAS 19 "Employee Benefits", effective for annual periods beginning on or after January 1, 2013.

	IAS 1 (amendment) "Presentation of Financial Statements". The amendment changes the disclosures of items presented in Other Comprehensive Income in the Statement of Comprehensive Income.

	IAS 19 (amendment) "Employee Benefits". The amendment makes significant changes to the recognition and measurement of defined benefit pension expense and termination benefits, and to the disclosures for all employee benefits.

	The Group is still in the process of assessing whether there will be any significant changes to its consolidated financial statements upon adoption of any of these new standards or amendments.

	The preparation of financial statements in conformity with IFRS recognition and measurement principles requires the use of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Management reviews its estimates on an ongoing basis using currently available information. Changes in facts and circumstances may result in revised estimates, and actual results could differ from those estimates.

2.	Operations in the interim period

	Capital Drilling Limited is incorporated in Bermuda. The Group provides drilling services including but not limited to exploration, development, grade control and blast hole drilling services to mineral exploration and mining companies located in emerging and developing markets. The Group also provides some procurement, equipment rental and information technology services to mining and mining related companies.

	During the six months ended 30 June 2011, the Group provided drilling services in Chile, Egypt, Eritrea, Mauritania, Mozambique, Papua New Guinea, Solomon Islands, Tanzania, and Zambia.

	The Group won a number of new drilling contracts. These include contracts with Chirano Gold Mine in Ghana, Gold Ridge Mining in Solomon Island and BHP Billiton projects in both Chile and Ethiopia. Drilling commenced in Chile and Solomon Island in the first half of 2011. Drilling in Ghana and Ethiopia is schedule to commence early in the second half of the year.

3.	Income tax

	The tax expense for the period is based on an estimated annual effective rate, which requires management to make its best estimate of annual pretax income for the year, in the various tax jurisdictions in which the Group operates in. During the year, management regularly updates its estimates based on changes in various factors such operating profits, plant operating performance and cost estimates, including labour, raw materials, energy and other variable costs.

		30/06/2011	30/06/2010
		$	$
4.	Earnings per share

	Basic earnings per share
	The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:

	Profit for the period attributable to equity holders of the parent, used in the calculation of basic earnings per share	8,593,320	3,974,254


	Weighted average number of ordinary shares for the purposes of basic earnings per share	134,592,800	99,104,725


	Basic earnings per share (cents)	6.4	4.0


	Diluted earnings per share
	Profit for the period used in calculation of diluted earnings per share	8,593,320	3,974,254


	Weighted average number of ordinary shares used in the calculation of basic earnings per share	134,592,800	99,104,725

	Shares deemed to be issued for no consideration in respect of:

	- Shareholder options	-	6,012,774
	- Employee options	99,303	4,509,581


	Weighted average number of ordinary shares used in the calculation of diluted earnings per share	134,692,103	109,627,080


	Diluted earnings per share (cents)	6.4	3.6


	The denominators for the purposes of calculating both basic and diluted earnings per share have been adjusted to reflect the share split in 2010.
5.	Dividends

	No dividends have been declared or paid during the six months ended 30 June 2011 (six months ended 30 June 010: $nil).

6.	Property, plant and equipment

	During the six months ended 30 June 2011, the Group acquired approximately $12.4 million (2010: $6.2 million) of drilling rigs and other assets to expand its operations and for the replacement of existing assets.

	The Group disposed of property, plant and equipment with a net book value of $985 thousand (2010: $350 thousand) during the period.

		30/06/2011	31/12/2010
		$	$
7.	Issued capital

	Authorised capital
	2 000 000 000 (2010: 2 000 000 000) ordinary shares of 0.01 cents (2010: 0.01 cents) each	200,000	200,000


	Issued and fully paid:
	134 592 800 (2010: 134 592 800) ordinary shares of 0.01 cents (2010: 0.01 cents) each	13,459	13,459


	Share premium:
	Balance at the beginning of the period	21,561,190	189,600
	Exercise of shareholder share options	-	1,917,600
	Exercise of executive share options	-	3,688,300
	Repayment of capital	-	(2,500,000)
	Acquisition of non-controlling interest	-	791,563
	Effect of share split	-	7,440
	Issue of shares	-	19,594,015
	Share issue cost	-	(2,127,328)


	Balance at the end of the period	21,561,190	21,561,190


	On 23 April 2010, pursuant to the exercise of fully vested options, the Group allotted and issued 42 000 ordinary shares of 10 cents each at a price of $80.00 per share. On 28 May 2010, the Group increased and subdivided its authorised share capital into 2 000 000 000 ordinary shares of 0.01 cents. On the same date the Group allotted and issued 892 800 ordinary shares of 0.01 cents in consideration for the transfer to the Group of the remaining stakes in Capital Drilling (T) Limited and Capital Drilling Egypt Limited Liability Company. On 7 June 2010, the Company was admitted to the Official List of the UK Listing Authority and to trading on the Main Market of the London Stock Exchange. As part of the successful listing, 22.1 million ordinary shares of 0.01 cents were issued at $0.8867 per share. The net proceeds amounted to $17.5 million (net of share issue cost).

8.	Long term debt

	The Group did not take up any additional debt during the six months ended 30 June 2011.

	On 26 April 2010, the Group (through Capital Drilling Mauritius Limited) entered into a new debt facility with Standard Bank (Mauritius) Limited. The new facility comprises (i) a $15 million medium term loan ("MTL") facility and (ii) a $1 million settlement limit facility. The MTL facility is available for 12 months from the date of first draw down and is repayable over four years from the earliest of the first anniversary of the first draw down or full utilisation. The security and covenants attached to this loan remains unchanged.

	The Group also has an outstanding long term loan with Stanbic Bank Zambia. The loan is repayable over 4 years and used to finance the purchase of drilling rigs and vehicles.

	The Group purchased 5 drilling rigs and accessories for a total cost of $3.1 million from Atlas Copco in 2010. $2.6 million of these purchases were financed through loans obtained from Atlas Copco Customer Finance AB. These loans are repayable quarterly in arrears over a period of four years.

	The Group continued payment of principal and interest of the long term debt to Atlas Copco, Standard Bank (Mauritius) Limited and Stanbic Bank Zambia Limited during the six months ended 30 June 2011.

9.	Short-term loans

	The Group purchased 2 drilling rigs in 2010 to be used for the Polar Star Mining Project in Chile. The acquisition of the rigs were financed through a loan, amounting to $0.8 million, obtained from Polar Star Mining. The loan is repayable through a deduction of 15% from the drilling invoices issued relating to this project.

	During the six months ended 30 June 2011, the Group settled all amounts due to Polar Star Mining Project in Chile.

11.		Segmental analysis (continued)
	For the six months ended 30 June 2010		Africa				Rest of world	Consolidated
				$			$	$

	External revenue		25,509,597				3,416,361	28,925,958


	Segment gross profit		8,895,996				592,045	9,488,041

	Administration costs and depreciation, net of other income		(2,185,270)				(291,006)	(2,476,276)


	Segment profit			301,039			7,011,765


	Central administration costs and depreciation							(2,462,957)
	Other income							695,966


	Profit from operations							5,244,774

	Finance charges - net							(620,721)


	Profit before tax							4,624,053


	The accounting policies of the reportable segments are the same as the Group's accounting policies described in note 1. Segment profit represents the profit earned by each segment without allocation of central administration costs, depreciation, other income, finance charges, and income tax. This is the measure reported to the Group's chief executive for the purpose of resource allocation and assessment of segment performance.


	Segment assets:

	Africa					119,010,530		109,196,805
	Rest of world					48,525,882		49,740,355


	Total segment assets					167,536,412		158,937,160
	Head office companies					18,899,762		26,546,069


							186,436,174	185,483,229
	Eliminations						(80,591,684)	(88,882,743)


							105,844,490	96,600,486


	Segment liabilities:

	Africa					29,932,034		29,297,648
	Rest of world					23,118,248		23,138,984


	Total segment liabilities					53,050,282		52,436,632
	Head office companies					62,789,528		70,482,630


							115,839,810	122,919,262
	Eliminations						(80,001,171)	(87,688,549)


							35,838,639	35,230,713


	For the purposes of monitoring segment performance and allocating resources between segments the Group's chief executive monitors the tangible, intangible and financial assets attributable to each segment. All assets are allocated to reportable segments with the exception of property, plant and equipment used by the head office companies, certain amounts included in other receivables, and cash and cash equivalents held by the head office companies.

	Information about major customers
	Included in revenues arising from the Africa segment are revenues of approximately $37.2 million (2010: $19.7 million) which arose from sales to the customers that represent more than 10% of the Group's revenue.

					30/06/2011			31/12/2010
					$			$
12.	Contingencies and commitments

	The Group has the following commitments at 30 June 2011:

	Committed capital expenditure					4,254,826		2,026,212


	The Group also has outstanding purchase orders amounting to $4.4 million at 30 June 2011 (31/12/2010: $2.5 million).

13.	Subsequent events

	The directors are not aware of any facts or circumstances of a material nature arising since the end of the period to the date of this report which significantly affect the financial position of the Group or the results of its operations.

14.	Going concern

	The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Highlights. The financial position of the Group, its cash flows and liquidity position are also described in the Highlights. The Group has set specific objectives and also has policies and processes in place to manage its capital and its financial, credit risk and liquidity risks.

	The Group has borrowings and debt facilities which, together with its clients' receipts, fund its day to day working capital requirements. Volatile economic conditions may create uncertainty particularly over (a) the level of demand for the Group's services; (b) exchange rate fluctuations against the US Dollar and thus the consequence for the cost of the Group's direct costs; and (c) the availability of bank financing in the foreseeable future.

	The Group's forecasts and projections, taking into account of potential changes in its performance, show that the Group should be able to operate within the level of its capital structure. The Group has held discussion with its bankers about its future borrowing needs and no matters have been drawn to its attention to suggest that these needs may not be met on acceptable terms.

	The directors confirm that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group continues to adopt the going concern basis of accounting in preparing the interim financial statements.

STATEMENT OF DIRECTORS' RESPONSIBILITY
For the six months ended 30 June 2011


The directors are responsible for the maintenance of adequate accounting records and the preparation and integrity of the condensed consolidated interim financial statements and related information. The auditors are responsible for expressing an opinion on the condensed consolidated interim financial information based on their review.

The directors are also responsible for the Group's systems of internal financial control. These are designed to provide reasonable, but not absolute, assurance as to the reliability of the financial statements, and to adequately safeguard, verify and maintain accountability for the Group's assets, and to prevent and detect misstatement and loss. Nothing has come to the attention of the directors to indicate that any material breakdown in the functioning of these controls, procedures and systems has occurred during the six months under review.

We confirm that to the best of our knowledge:

{a}	the condensed set of consolidated interim financial statements has been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting, as issued by the International Accounting Standards Board;

{b}	the interim management report includes a fair review of the information required by DTR 4.2.7 (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and

{c}	there has been no significant individual related party transactions during the first six months of the financial year and nor have there been any significant changes in the Group's related party relationships from those reported in the Group's annual financial statement for the year ended 31 December 2010.

The condensed consolidated interim financial statements have been prepared on the going concern basis since the directors believe that the Group has adequate resources in place to continue in operation for the foreseeable future.

The condensed consolidated interim financial statements were approved by the board of directors on 17 August 2011.