Results for twelve months ended 30 September 2011

Companies

Nativo Resources (NTVO)

UK 100

Latest directors dealings

7 minutes ago M&G
16 minutes ago Frasers Group
22 minutes ago BT Group
35 minutes ago CLS Holdings
42 minutes ago British American Tobacco

All directors dealings today

Independent Resources plc

("Independent Resources" or the "Company" or the "Group")

Results for the twelve months ended 30 September 2011

Highlights

·	Keystone Rivara Gas Storage Project: formal environmental approvals still pending
	Exhaustive consultation process continues to progress slowly, but with encouraging indications of a successful outcome.

·	Ribolla Shale Gas Project: 2-block farm-out process underway
	Third party evaluation confirms estimates of in-place and recoverable gas at 15.2 BCM (540 BCF) and 4.5 BCM (160 BCF) respectively. Discussions under way to realise the value of this significant asset.

·	Ksar Hadada Shale Oil Project: permit renewed, operations planned in 2012
	Carried interest maintained. Discussions under way to realise the value of this potentially significant asset.

·	Committed third-party funding for projects as at 30 September 2011: £4.5 million (2010: £5.2 million)

·	Net cash at 30 September 2011: £2.5 million (2010: £3.9 million)

Commenting, Grayson Nash, Executive Chairman of Independent Resources, said: "Given the status of our three main projects, we believe the time is right to start exploring value-adding options for separating our valuable but relatively riskier E&P interests from our more strategic gas storage assets. This will enable the company to focus its resources primarily on Rivara as we execute our plans to realise maximum value from this major asset. I look forward to providing further updates over the next few months."

Chairman's statement

Our progress this year - particularly with regard to the permitting of Rivara - was again not as swift as we would have liked it to be, but I believe it was ultimately encouraging. The core projects of Independent Resources are substantial and remain on the right track. As a result of the board's substantial equity stake in the company, the interests of the directors and of all our shareholders are wholly aligned. Conditions are now right to make important, forward-looking decisions about where we intend to monetise and where we intend to focus our investment in the future in order to maximise shareholder value.

During the reporting period, we further stepped up our efforts to secure the environmental permits and consequent mineral title that will allow the company to commence development of our keystone underground gas storage ("UGS") facility at Rivara in the Po Valley. These efforts continue to yield very gradual but tangible progress.

Discussions regarding the future of the Ribolla shale gas project near Grosseto also moved forward; our aim is to shape a future in which shareholders remain financially interested in the project's success, but are no longer exposed to the capital cost of its de-risking. The company's stake in the Ksar Hadada oil-prone block in Tunisia is another area where we are seeking to become less directly involved while maintaining our upside exposure.

In all these activities, we continue to maintain a cost-conscious and value-focused approach, and are confident that we will be in a position to announce significant developments in the first half of 2012.

This year I intend to keep my statement brief, because I do not want to pre-empt developments that may come to fruition very soon after it is written. It is not possible to predict exactly when these important developments may occur, or what they will entail, but I believe they will be welcomed - and sooner rather than later - by everyone who has a stake in our future.

Rivara

I have written extensively to you in the past about what makes Rivara special and valuable. I have written even more about our permitting challenges and the shifting complexities through which projects of this nature must navigate. The politics of infrastructural development are unpredictable and immensely time-consuming. Yet we continue - imperceptibly at times, but measurably over time - to move the ball forward.

If anything has helped to concentrate minds among our many stakeholders recently, it is the severe economic crisis we are living through. Even a wealthy region of Italy like Emilia Romagna now recognises that opposition to local development which is clearly in the national interest, and is subject to a very thorough and objective consultation process, has direct consequences for the region's growth, budgets, and prosperity. We have been gratified by the results of third-party econometric studies on the impact of our project that indicate significant and long-term employment, added-value, and fiscal benefits to the region and communities in which the project is located.

We and our local industrial partners continue to do everything we can to reassure these communities, by demonstrating how unobtrusive the surface facilities of the gas storage facility will be, and the comprehensive measures that will be put in place to ensure it is safe, clean and has minimal environmental impact.

That is as much as I am able to report on Rivara at this time, but I hope there may be more to say by the time of our Annual General Meeting next month.

Independent Resources plc

Consolidated statement of comprehensive income

Year ended 30 September 2011

	Notes	2011	2010
Continuing operations		£	£

Revenue		-	-

Cost of sales		-	-

Gross profit		-	-

Administrative expenses		(1,174,737)	(1,164,280)

Operating loss before impairment		(1,174,737)	(1,164,280)

Impairment of Ksar Hadada		-	(1,390,588)

Operating loss		(1,174,737)	(2,554,868)

Financial income		35,310	355,041

Financial expense		(24,818)	(3,594)

Loss on ordinary activities before taxation		(1,164,245)	(2,203,421)

Taxation	3	-	44,365

Loss for the year		(1,164,245)	(2,159,056)

Other comprehensive income:

Exchange difference on translating foreign operations		69,384	(735,217)

Income tax relating to other comprehensive income		-	44,594

Total comprehensive loss for the year		(1,094,861)	(2,849,679)

Loss attributable to:

Owners of the parent		(1,133,327)	(2,135,505)

Non-controlling interests		(30,918)	(23,551)

		(1,164,245)	(2,159,056)

Total comprehensive loss attributable to:

Owners of the parent		(1,067,632)	(2,742,618)

Non-controlling interests		(27,229)	(107,061)

		(1,094,861)	(2,849,679)

Loss per share (pence)	4

From continuing operations

Basic		(2.5)	(5.0)

Diluted		(2.5)	(5.0)

Independent Resources plc

Consolidated statement of financial position

As at 30 September 2011


	Notes	2011		2010
			£		£
Non-current assets
Property, plant and equipment			51,232		75,716
Goodwill	5		450,766		450,766
Other intangible assets	6		9,315,485		7,990,178

			9,817,483		8,516,660

Current assets
Other receivables		4,524,726		5,457,781
Current taxation assets		-		88,588
Cash and cash equivalents		2,501,605		3,894,310

		7,026,331		9,440,679

Current liabilities
Trade and other payables		(763,892)		(582,558)
Provisions		-		(309,759)

		(763,892)		(892,317)
Net current assets			6,262,439		8,548,362

Net assets			16,079,922		17,065,022

Equity attributable to equity holders of the parent
Share capital	7		458,369		458,369
Share premium	8		15,287,351		15,287,351
Shares to be issued			-		-
Share option reserve			109,761		389,844
Foreign currency translation reserve			895,990		830,295
Retained earnings			(1,984,540)		(1,241,057)

			14,766,931		15,724,802

Non-controlling interests			1,312,991		1,340,220

Total equity			16,079,922		17,065,022

Independent Resources plc

Statement of changes in equity

Year ended 30 September 2011

						Foreign
				Shares	Share	currency		Non-
	Retained	Share	Share	to be	option	translation		controlling	Total
	earnings	capital	premium	issued	reserve	reserve	Total	interests	equity
	£	£	£	£	£	£	£	£	£
Consolidated

1 October 2009	894,448	415,739	12,881,702	4,802,904	389,844	1,437,408	20,822,045	1,447,281	22,269,326

Loss for the year	(2,135,505)	-	-	-	-	-	(2,135,505)	(23,551)	(2,159,056)
Exchange differences	-	-	-	-	-	(651,707)	(651,707)	(83,510)	(735,217)
Taxation on exchange differences	-	-	-	-	-	44,594	44,594	-	44,594

Total comprehensive loss for the
year	(2,135,505)	-	-	-	-	(607,113)	(2,742,618)	(107,061)	(2,849,679)

Fair value adjustments	-	-	-	(4,802,904)	-	-	(4,802,904)	-	(4,802,904)
New shares issued	-	42,630	2,515,170	-	-	-	2,557,800	-	2,557,800
Share issue costs	-	-	(109,521)	-	-	-	(109,521)	-	(109,521)

30 September 2010	(1,241,057)	458,369	15,287,351	-	389,844	830,295	15,724,802	1,340,220	17,065,022

1 October 2010	(1,241,057)	458,369	15,287,351	-	389,844	830,295	15,724,802	1,340,220	17,065,022

Loss for the year	(1,133,327)	-	-	-	-	-	(1,133,327)	(30,918)	(1,164,245)
Exchange differences	-	-	-	-	-	65,695	65,695	3,689	69,384

Total comprehensive loss for the
year	(1,133,327)	-	-	-	-	65,695	(1,067,632)	(27,229)	(1,094,861)

Share options lapsed	389,844	-	-	-	(389,844)	-	-	-	-
Share-based payments	-	-	-	-	109,761	-	109,761	-	109,761

30 September 2011	(1,984,540)	458,369	15,287,351	-	109,761	895,990	14,766,931	1,312,991	16,079,922

Independent Resources plc

Consolidated statement of cash flows

Year ended 30 September 2011

		2011	2010
Cash flows from operating activities		£	£

Loss before taxation		(1,164,245)	(2,203,421)
Adjustments for:
	Depreciation of property, plant and equipment	29,867	32,628
	Provision for well shut down costs	(309,759)	309,759
	Impairment of intangible assets	-	1,080,829
	Financial income	(35,310)	(355,041)
	Financial costs	24,818	3,594

		(1,454,629)	(1,131,652)
Decrease in other receivables		918,055	612,154
Increase/(decrease) in trade and other payables		181,334	(521,452)
Share-based payments		109,761	-
Exchange rate difference on investments		48,729	(384,322)

Cash used in operations		(196,750)	(1,425,272)

Income taxes received/(paid)		88,588	(73,129)

Net cash used in operating activities		(108,162)	(1,498,401)

Cash flows from investing activities

Interest received		35,310	38,041
Interest paid		(9,818)	(3,594)
Proceeds on disposal of property, plant and equipment		-	26,527
Purchase of intangible assets		(1,304,848)	(2,406,018)
Purchases of property, plant and equipment		(5,187)	(47,927)

Net cash used in investing activities		(1,284,543)	(2,392,971)

Cash flows from financing activities

Issue of share capital		-	2,557,800
Share issue costs		-	(109,521)

Net cash from financing activities		-	2,448,279

Net decrease in cash and cash equivalents		(1,392,705)	(1,443,093)

Cash and cash equivalents at 1 October 2010		3,894,310	5,337,403

Cash and cash equivalents at 30 September 2011		2,501,605	3,894,310

Independent Resources plc

Notes to the final results for the year ended 30 September 2011

1.	Basis of preparation

	The financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union and using accounting policies which are consistent with those applied in the financial statements for the year ending 30 September 2010.

	The financial information set out in this announcement, which does not constitute the statutory financial statements of the Group but was derived from those financial statements. The auditors have reported on the financial statements for the period ended 30 September 2011; this report was unqualified.

	The financial information for the year ending 30 September 2010 is derived from the financial statements for that year. The company's auditors have reported on the 2010 financial statements; their report was unqualified.

	The financial information set out in this announcement was approved by the board on 22 November 2011.

	The directors do not recommend the payment of a final dividend.

	The full statutory financial statements will be included in the Group's annual report, which will be e-mailed or posted to shareholders on 25 November 2011. They will be available during normal business hours from the offices of Seymour Pierce Limited at 20 Old Bailey, London EC4M 7EN from that date. In addition, the annual report and accounts will be available to be downloaded from the Company's website at www.ir-plc.com . Additional copies will be available at the Group's offices Tower Bridge House, St. Katharine's Way, London E1W 1DD after that date. The accounts will be delivered to the Registrar of Companies after the Company's Annual General Meeting, which is scheduled for 20 December 2011.


2.	Business segments

	The group has adopted IFRS 8 Operating segments from 1 October 2009. Per IFRS 8, operating segments are based on internal reports about components of the group, which are regularly reviewed and used by the Board of Directors being the Chief Operating Decision Maker ("CODM") for strategic decision making and resource allocation, in order to allocate resources to the segment and to assess its performance. The group's reportable operating segments are as follows:

	a.	Parent company
	b.	Rivara
	c.	Ribolla Basin CBM & Shale Gas Assets
	d.	Ksar Hadada

	The CODM monitors the operating results of each segment for the purpose of performance assessments and making decisions on resource allocation. Performance is based on assessing progress made on projects and the management of resources used. Segment assets and liabilities are presented inclusive of inter-segment balances.

	The group did not generate any revenue during the year to 30 September 2011 nor in the year to 30 September 2010.

	Information regarding each of the operations of each reportable segments is included in the following table.

					Ribolla Basin
			Parent		CBM & Shale
			company	Rivara	Gas Assets	Ksar Hadada	Consolidation	Total
			£	£	£	£	£	£
	2011

	Interest revenue		285,134	46,450	11	-	(296,285)	35,310
	Interest expense		-	(173,905)	(147,198)	-	296,285	(24,818)
	Depreciation		-	4,120	25,747	-	-	29,867
	Impairment of intangible assets		-	-	-	-	-	-
	Income tax		-	-	-	-	-	-
	Loss for the year before taxation		(92,929)	(325,835)	(612,519)	(93,594)	(39,368)	(1,164,245)

	Assets		13,158,478	12,620,924	4,741,670	156,989	(13,834,247)	16,843,814
	Liabilities		(59,572)	(5,543,389)	(5,044,622)	(462,016)	10,345,707	(763,892)

	2010

	Interest revenue		246,674	318,097	369	-	(210,099)	355,041
	Interest expense		-	(90,153)	(123,540)	-	210,099	(3,594)
	Depreciation		1,726	2,218	28,684	-	-	32,628
	Impairment of intangible assets		-	-	-	1,080,829	-	1,080,829
	Income tax		88,959	-	-	-	(44,594)	44,365
	Profit/(loss) for the year before taxation		(1,706,957)	20,853	(673,046)	(206,006)	361,735	(2,203,421)

	Assets		13,142,757	11,580,315	4,544,026	104,876	(11,414,635)	17,957,339
	Liabilities		(60,683)	(4,198,340)	(5,214,482)	(316,309)	8,897,497	( 892,317)

		The geographical split of non-current assets arises as follows:

			United
			Kingdom	Overseas		Total
			£	£		£
		2011

		Intangible assets	-	9,315,485		9,315,485
		Goodwill	-	450,766		450,766
		Property, plant and equipment	-	51,232		51,232

		2010

		Intangible assets	-	7,990,178		7,990,178
		Goodwill	-	450,766		450,766
		Property, plant and equipment	-	75,716		75,716

3.	Taxation
			2011		2010
			£		£
	Tax on profit on ordinary activities

	Taxation charged based on profits for the year

	UK corporation tax based on the results for the year		-		(43,994)
	Over provided in prior year		-		(371)

	Total tax expense in income statement		-		(44,365)

	Reconciliation of the tax expense

	The tax assessed for the year is different from the standard rate of corporation tax in the UK (27%). The differences are explained below:

			2011		2010
			£		£

	Loss on ordinary activities before taxation		(1,164,245)		(2,203,421)


	Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 27% (2010: 28%)		(314,346)		(616,958)

	Effects of:
	Expenses disallowed for tax purposes		29,679		-
	Untaxed expense/(income) on deemed disposal of interest in subsidiary		4,050		(88,354)
	Deferred tax not provided - tax losses carried forward		280,617		662,137
	Marginal tax relief		-		(819)
	Adjustments to tax charge in respect of previous years		-		(371)

	Total current tax		-		(44,365)

	The group has tax losses available to be carried forward in certain subsidiaries and the parent. With anticipated substantial lead times for the group's projects, and the possibility that these may therefore expire before their use, it is not considered appropriate to anticipate an asset value for them.

4.		Loss per share

		The calculation of basic and diluted loss per share at 30 September 2011 was based on the loss attributable to ordinary shareholders of £1,133,327. The weighted average number of ordinary shares outstanding during the year ending 30 September 2011 and the effect of the potentially dilutive ordinary shares to be issued are shown below.

		Contingently issuable shares such as included within the share option scheme have not been treated as dilutive as the market conditions have not been met at 30 September 2011.

			2011	2010
			£	£

		Net loss for the year	(1,133,327)	(2,135,505)

		Basic weighted average ordinary shares in issue during the year	45,836,867	42,543,262

		Diluted weighted average ordinary shares in issue during the year	45,836,867	42,543,262

5.	Goodwill (group)
				Goodwill
				£
	2011

	Cost

	1 October 2010 and 30 September 2011			450,766

	Carrying amount

	30 September 2011			450,766

	30 September 2010			450,766

	2010

	Cost

	1 October 2009			5,253,670
	Fair value adjustment			(4,802,904)

	30 September 2010			450,766

	Carrying amount

	30 September 2010			450,766

	30 September 2009			5,253,670

	The goodwill arises as a result of the acquisition of Independent Energy Solutions srl and fair value adjustments to the shares to be issued relating to the acquisition of Independent Gas Management srl. The fair value adjustment relates to the directors' review of their estimate of the cost of the acquisition of Independent Gas Management srl based upon the market conditions at the year end and the probability of issuing shares, contingent upon market conditions subsequent to the year end. The directors assessed at the year end the likelihood of the market conditions relating to the final tranche and, on this basis, have assessed that no further shares to be issued are expected to occur on this transaction. The market conditions relating to the final tranche have not been met and confirmed that no further shares are currently expected to be issuable in connection with the acquisition. The goodwill arising as a result has therefore been reversed as a fair value adjustment against the shares to be issued.

	A review of the latest management information and projections shows a net present value significantly in excess of assets and liabilities relating to this project. The main assumptions indicate that no significant change has arisen on these calculations which would materially impact on the group.

	The continuing analysis and testing of technical data continues to indicate that the project is feasible.

	The group continues to work towards, and is confident of, obtaining all the necessary approvals from regulatory authorities.

	The group anticipates being able to raise the necessary finance to continue to develop the project.

	For the purpose of goodwill impairment testing, recoverable amounts have been determined based upon the value in use of the Ribolla project.

	Value in use

	Cash flows are projected for the periods up to the date that the project is expected to become commercially operational and from then until operations are expected to cease, based upon management's expectations. These dates depend on a number of variables, including the project's technical feasibility, regulatory approval, forecast revenue prices and the associate development and operational costs.

	The project is expected to generate revenue after five to nine years and to continue doing so for a further 35 years. The directors consider that projections calculated for a period greater than five years are justified as the project is still in a development stage. The directors have used a constant rate of growth of 2.5% (2010: 2.5%) to extrapolate the cash flow projections beyond the period in which the projects will commence to generate revenue. This growth rate is considered to cover increases resulting from inflation and regulatory changes. The discount rate used is 10.0% (2010: 10.0%).

	Key assumptions used in value in use calculations

	The key assumptions used in the value in use calculations for the goodwill asset are the anticipated quantity of resource available for extraction, costs of plant and infrastructure, expected revenue prices, expected operational costs, appropriate discount rates and foreign exchange rates. For further details please see note 6.

	Management's assessment of the technical viability of the projects is supported by the evaluation work undertaken by appropriately qualified persons.

	Management have assessed the project's individual net present value and thereby impairment on a variety of bases and assumptions using, where appropriate, a number of discount rates. The impairment tests are particularly sensitive to changes in the key assumptions and changes to these assumptions could result in impairment; however, all of the varying bases indicate a net present value significantly in excess of the value of goodwill.

	Foreign exchange rates have been based on external market forecasts, after considering long-term market expectations and the countries in which the group operates.

6.	Other intangible assets (group)

	Development and exploration
		Rivara gas	Ribolla Basin	Ksar Hadada
		storage	CBM & Shale	exploration
		facility	Gas assets	acreage	Total
		£	£	£	£
	2011

	Cost

	1 October 2010	4,025,204	3,864,974	1,180,829		9,071,007
	Exchange differences	10,437	10,022	-		20,459
	Additions	856,969	390,890	56,989		1,304,848

	30 September 2011	4,892,610	4,265,886	1,237,818		10,396,314

	Amortisation

	1 October 2010	-	-	1,080,829		1,080,829
	Impairment charge for the year	-	-	-		-

	30 September 2011	-	-	1,080,829		1,080,829

	Carrying amount

	30 September 2011	4,892,610	4,265,886	156,989		9,315,485

	30 September 2010	4,025,204	3,864,974	100,000		7,990,178

	2010

	Cost

	1 October 2009	3,311,726	2,673,017	1,025,917		7,010,660
	Exchange differences	(191,281)	(154,390)	-		(345,671)
	Additions	904,759	1,346,347	154,912		2,406,018

	30 September 2010	4,025,204	3,864,974	1,180,829		9,071,007

	Amortisation

	1 October 2009	-	-	-		-
	Impairment charge for the year	-	-	1,080,829		1,080,829

	30 September 2010	-	-	1,080,829		1,080,829

	Carrying amount

	30 September 2010	4,025,204	3,864,974	100,000		7,990,178

	30 September 2009	3,311,726	2,673,017	1,025,917		7,010,660

	The primary intangible assets are all internally generated.

	For the purpose of impairment testing of intangible assets, recoverable amounts have been determined based upon the value in use of the group's three projects.

	Ksar Hadada exploration acreage - impairment charge

	The results for the 2010 drilling campaign, which was completed shortly after the start of the current year, were unsuccessful, although a significant amount of new and valuable data has been produced and analysed. The vast majority of the company's expenditures to 30 September 2010 have therefore been written off as an impairment charge in the previous year.

Rivara gas storage facility and Ribolla Basin CBM & Shale Gas assets

A review of the latest management information and projections shows a net present value significantly in excess of assets and liabilities relating to the projects. The main assumptions indicate that no significant change has arisen on these calculations which would materially impact on the group.

The continuing analysis and testing of technical data continues to indicate that the projects are feasible.

The group continues to work towards, and is confident of, obtaining all the necessary approvals from regulatory authorities.

The group anticipates being able to raise the necessary finance to continue to develop the projects.

Value in use

Value in use has been calculated separately for the group's Rivara gas storage facility and Ribolla Basin CBM & Shale Gas assets. Cash flows are projected for the periods up to the date that the projects are expected to become commercially operational and from then until operations are expected to cease, based upon management's expectations. These dates depend on a number of variables, including the project's technical feasibility, regulatory approval, forecast revenue prices and the associate development and operational costs.

The projects are expected to generate revenue after five to nine years and to continue doing so for a further 35 years. The directors consider that projections calculated for a period greater than five years are justified as the projects are still in a development stage.

Key assumptions used in value in use calculations

The key assumptions used in the value in use calculations for the intangible assets are the expected storage and useable capacity of the Rivara project, the anticipated quantity of resource available for extraction for the Ribolla Basin project, costs of plant and infrastructure, expected revenue prices (specifically gas prices), expected operational costs, appropriate discount rates and foreign exchange rates.

Management's assessment of the technical viability of the projects is supported by the evaluation work undertaken by appropriately qualified persons.

Management has assessed the projects' individual net present values and thereby impairment on a variety of bases and assumptions using, where appropriate, a number of discount rates. The impairment tests are particularly sensitive to changes in the key assumptions and changes to these assumptions could result in impairment; however, all of the varying bases indicate a net present value significantly in excess of the value of the intangible assets.

Foreign exchange rates have been based on external market forecasts, after considering long-term market expectations and the countries in which the group operates.

The key assumptions used in the value in use calculations are as follows:


			Assumption	Sensitivity
				factor *

Rivara gas storage facility:

	Growth rate		2.0%	-
	Discount rate		6.3%	+55%
	Capital expenditure		-	+35%

Ribolla Basin CBM & Shale Gas assets:

	Growth rate		2.5%	-
	Discount rate		10.0%	+115%
	Gas price	€0.26 per cubic metre		-25%
	Capital expenditure		-	+36%

The growth rates are considered to cover increases resulting from inflation and regulatory changes.

The discount rate for the Rivara project reflects expected return levels and has been agreed with the project partner.

* The sensitivity factor is the percentage change in each specific assumption which would, on its own, result in the net present value equal to the carrying value of the intangible asset in the accounts.