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Legendary Invest PLC (LEG)

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Thursday 20 December, 2012

Legendary Invest PLC

Interim Results for 6 months ended 30 Sept 2012

RNS Number : 9756T
Legendary Investments PLC
20 December 2012
 



20 December 2012

 

LEGENDARY INVESTMENTS PLC ("Legendary" or the "Company")

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2012

 

HIGHLIGHTS

 

·      Terra Energy/Fastnet Oil and Gas lists generating realised return of over 4x in 17 months

·      Medgold Resources lists (post period end) generating return of almost 3x in 16 months

·      Sula Iron and Gold lists (post period end) generating return of almost 2x in 5 months

·      Other investments continue to progress

·      New investment in VirtualStock made (post period)

 

BOARD'S STATEMENT

 

Legendary continues to execute on its strategy. During the period, a number of new investments were made; existing investments progressed; and one investment listed generating a 4.3x return. After the period end, a further investment was made and two more investments listed, again generating substantial returns of 2.8x and 1.7x. These results validate Legendary's strategy. Progress continues at an increasing pace.

 

In May 2011, Legendary secured a EUR30,000 investment in the heavily oversubscribed Terra Energy Limited ("Terra") fund raise. In June 2012, Terra was renamed Fastnet Oil and Gas PLC ("Fastnet") and listed on AIM in London and ESM in Dublin. As at the period end, Legendary's stake in Fastnet was worth £76,000. Subsequent to the period end, Legendary exited this investment realising £119,000. This represented a realised return of 4.3x in 17 months.

In July 2011, Legendary invested £50,000 in Medgold Resources Limited ("Medgold"). Post the period end, in December 2012, Emerick Resources Corp. acquired Medgold, with the Medgold shareholders retaining 61.6 % of the enlarged company.  The new company, Medgold Resources Corp., resumed trading on the TSX-V in Canada. Based on the closing price of Medgold Resources Corp. on 17 December 2012, Legendary's stake was worth £141,000. This represents an unrealised return of 2.8x in 16 months.

 

In July 2012, Legendary invested £50,000 in a convertible loan note in a pre-IPO funding round for Sula Iron and Gold PLC ("Sula"). As part of the convertible loan note, upon any listing of Sula, Legendary would receive warrants. Post the period end, in October 2012, Sula was admitted to trading on AIM. Based on the closing price of Sula on 17 December 2012, Legendary's 5 month unrealised return on this investment was 1.7x.

 

In July 2012 Legendary invested £50,000 in Regency Mines PLC ("Regency"). Regency is a mineral exploration and development company focusing on nickel and cobalt in Papua New Guinea and gold, flake graphite and base metals in Australia. Legendary believes Regency's multiple investments have the potential to generate significant returns.

Also in July 2012, Legendary invested £100,000 into Kyrgyzstan based Manas Minerals LLC ("Manas Minerals"). Manas Minerals owns the Padsha Ata Licence to mine for coal in the Asksy region of Jalal-Abad. Soviet surveys suggest that the region contains 182 million tonnes of coal reserves of which 116 million is of coking coal quality. Jalal-Abad is strategically located within 200 km of the Chinese border. Legendary's investment is by way of a convertible loan note which when converted is expected to result in Legendary having a 1.0% stake in Manas Minerals. Legendary also obtained a warrant which upon exercise is expected to result in Legendary having an additional 0.5% stake in Manas Minerals. Manas Minerals plans to list in the near term.

Post the period end, in October 2012, Legendary negotiated a small minority stake in VirtualStock Limited ("VS") for a consideration which included strategic, financial and business consultancy services and just over £50,000 in cash. In addition, Legendary negotiated a warrant to double its stake in VS at an increased valuation. VS is a cloud-based software service business which enables retailers to increase dramatically the range of products they sell online without the associated costs of and risks of holding stock. VS is revenue generating and profitable. Subsequent to the investment, VS reached a significant milestone in delivering service to its growing list of clients by implementing an "end-to-end turn-key solution" for the online branded product range of Bear Grylls Ventures LLP through its website, www.beargryllsstore.com.

Progress continues to be made at Bosques Energeticos EBE C.V. de S.A. ("BE"). The in the field R&D programme continues to generate positive results: the elite pongamia continues to flourish, with the first fruits reported recently (post the period end). The elite jatropha and elite castor are also doing well and intercropping is proving successful. With successful R&D, BE is now seeking to plant out approximately 1,000 ha in a commercial plantation, with the aim of going to several thousand ha in the medium-term.

Progress at Undrawn Reality ("UR") Limited slowed considerably during the period. From discussions with UR, it became evident that the timeframe to develop UR's game had extended significantly. Legendary concluded that it would not receive a return on UR in the foreseeable future and wrote its investment down to zero. While disappointing, the loss was minimal at £2,000. The write-down freed time for Legendary to focus on more promising investments.

For the period, Legendary made a net gain on investments of £35k (2011: £0). Administrative costs were in line with the prior period at £83,000 (2011: £82,000). Overall, net loss for the first half of the year was £48,000 (2011: loss of £82,000). Legendary ended the period with £378,000 (2011: £110,000) of investments, £237,000 (2011: £0) of cash,  £574,000 (£94,000) of net assets and £634,000 (2011: £196,000) of total assets.

 

As at close 17 December 2012, Legendary had £538,000 of investments, £210,000 of cash, £707,000 of

net assets and £730,000 of total assets.

 

Legendary values its investments conservatively at historic price, unless a transaction has taken place or they are listed, in which case the transaction or market values are used.

 

Post the period end, at the start of November 2012, Zafar Karim, Non-Executive Director, was appointed the Executive Chairman. Zafar has been driving the rebuilding of Legendary. He is now devoting his time fully to Legendary. Also post the period end, in October 2012, Rajesh Kumar Rai resigned as an Executive Director of Legendary.

Legendary's progress continues. The listing of Fastnet, Sula and Medgold demonstrate Legendary's ability to source investments that offer substantial returns. Progress continues at BE, and shortly after Legendary's investment in VS, VS signed a significant milestone. Legendary has a conservative valuation policy and believes that its portfolio of investments is potentially worth a multiple of its book value. With several successful investments, increasing momentum and greater focus, the Board looks forward to accelerating Legendary's progress.

 

The Board

20 December 2012

 



PROFIT AND LOSS ACCOUNT

for the six months ended 30th September 2012

(£'000)

 

 

6m ended 30/09/12 Unaudited

6m ended 30/09/11 Unaudited

Year ended 31/03/12 Audited





Net gain on investments

35

0

0





Net administrative expenses before share option charge and exceptional items

(83)

(82)

(170)

Share option charge

0

0

(19)

Net administrative expenses

(83)

(82)

(189)





Operating  (loss)/profit

(48)

(82)

(189)





Finance charge

0

0

0





(Loss)/profit on ordinary activities before tax

(48)

(82)

(189)





Taxation

0

0

0





(Loss)/profit on ordinary activities after tax

(48)

(82)

(189)





(Loss) per share (basic and fully diluted) - pence

(0.003)

(0.01)

(0.01)

 

BALANCE SHEET

as at 30th September 2012

(£'000s)

As at
30/09/2012
Unaudited

As at
30/09/2011
Unaudited

As at
31/03/2012
Audited

Fixed Assets




Tangible assets

5

0

5

Investments

64

33

66





Current assets




Current asset investments

314

77

77

Debtors due within one year

14

86*

6

Cash at bank and in hand

237**

0

534


565

163

617

Creditors




Creditors: amounts falling due within one year

(30)

(72)

(36)

Creditors: amounts falling due after one year

(30)

(30)

(30)





Net assets/(liabilities)

574**

94

622





Capital and reserves




Called up share capital

1,575

960

1,575

Share premium account

8,309

8,309

8,309

Share based payment reserve

156

137

156

Profit and loss - deficit

(9,466)

(9,311)

(9,418)





Equity shareholders' funds/(deficit)

574**

94

622

 

*              Debtors due within one year of £86,000 represent the cash balance held in the client account of the Company's accountants as at 30 September 2011. The balance is payable on demand. Due to its short term nature, carrying value approximates to fair value.

**            As at close 17 December 2012, Legendary had £538,000 of investments, £210,000 of cash, £707,000 of net assets and £730,000 of total assets.

 

CASH FLOW STATEMENT

for the six months ended 30th September 2012                                                

(£'000)

 

 

6m ended
30/09/2012
Unaudited

6m ended
30/09/2011
Unaudited

Year ended
31/03/2012
Audited





Net cash outflow from operating activities

(98)

108

98





Purchase of office Equipment

0

0

(5)

Payments to acquire investments

(200)

(108)

(143)





Net cash outflow before financing

(200)

(108)

(148)





Financing




Issue of new ordinary shares

0

0

615

Increase in debt

0

0

0

Expenses paid in connection with share issue

0

0

(31)


0

0

584





Increase/(decrease) in cash in the period / year

(298)

0

534

 

Notes to the Interim Results

 

1.               Accounting Policies

                  The accounts have been prepared in accordance with applicable accounting standards under the historical cost accounting rules, modified by the revaluation of investments.

 

2.               Basis of Preparation of Half Yearly Financial Information

These unaudited interim financial statements for the six months ended 30 September 2012 have been prepared in accordance with United Kingdom Generally Accepted Accounting Standards. The financial information in this interim announcement does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006.

 

The comparative financial information for the year ended 31 March 2012 does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. The statutory accounts of Legendary Investments PLC for the year ended 31 March 2012 have been reported on by the Company's auditor and have been delivered to the Registrar of Companies.

 

The current and comparative periods to September have been prepared using accounting policies and practices consistent with those adopted in the annual financial statements for the year ended 31 March 2012 and are also consistent with those which will be adopted in the 31 March 2013 financial statements.

 

                  The Company is not required to prepare financial statements in accordance with International Accounting Standards as it is not a parent company. The directors are of the opinion that the adoption of International Accounting Standards would have no material impact on the reported results and will therefore continue to apply UK Generally Accepted Accounting Standards, but will reconsider the position should the Company's activities lead to a material difference between the accounting bases.

 

3.               Earnings Per Share                                                                                                                 

                  The calculation of earnings per share is based on the profit/ (loss) for the period divided by the weighted average number of ordinary shares in issue during the period of 1,575,167,198 (2011: 960,167,198).

 

4.               Half Yearly Report                                                                                                                  

                  The half yearly report, including the financial information contained herein, is the responsibility of, and was approved by the directors on 19 December 2012. The continuing obligations of the AIM Rules for Companies require that the accounting policies and presentation applied to the half yearly figures should be consistent with those applied in preparing preceding annual accounts except where any changes, and the reasons for them, are disclosed.

 

                  Copies of this report are available on the Company's website, www.legendaryinvestments.co.uk.

 

               

Contact:



Legendary Investments PLC

 

Zafar Karim / Thomas Reuner

020 8201 3536

Grant Thornton Corporate Finance

 

Colin Aaronson/ Melanie Frean

 

020 7383 5100

Simple Investments

Nick Emerson/ Andrew Thacker

01483 413500

 

 


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