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Indus Gas Limited (INDI)

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Friday 28 December, 2018

Indus Gas Limited

Half-year Report

RNS Number : 6857L
Indus Gas Limited
28 December 2018
 

Unaudited Condensed Consolidated Interim

Financial

Statements

 

Indus Gas Limited and its subsidiaries

 

Six months ended 30 September 2018

 

Indus Gas Limited (AIM:INDI.L), an oil & gas exploration and development company with assets in India, is pleased to report its interim results for the six month period ending 30 September 2018.

 

Consolidated reported adjusted revenues, operating profit and profit before tax for the interim period ending 30

September 2018 were US$ 27.78m (US$ 29.39 interim 2017),US$ 23.42m (US$ 25.63m interim 2017) and US$ 23.57m (US$ 23.63m interim 2017) respectively.

 

The Company has continued to make provision for a notional deferred tax liability of US$ 5.85m (US$ 7.92m interim 2017), in accordance with IFRS requirements.

 

As recently announced in our full year results, the Petroleum & Natural Gas Regulatory Board (PNGRB) have invited bids for the laying of a Gas Pipeline of 580 Kms for the evacuation of Gas from RJ-ON/6 Block. This new pipeline will connect the gas processing facility located at Langtala to Bhilwara. This will then connect to the National Grid through the Gas Authority of India Limited's (GAIL) Hazira-Vijaypur-Jagdishpur pipeline. The tender process continues to progress and a further update will be provided in due course. 

 

Following the approval by the Director General Of Hydrocarbons (DGH) and the Ministry of Petroleum and Natural Gas (MoP&NG) of the Integrated Field Development Plan for the SSG and SSF area, detailed on-site planning continues for the delivery of the required production ramp once the pipeline is constructed.  Planning is also at an advanced stage in respect of the SGL area and the revised Field Development Plan (FDP) for the enhancement of production from the current 33.5 mmscfd to an estimated 90 mmscfd.

 

Commenting, Peter Cockburn, Chairman of Indus, said:

 

Indus has reached a very exciting point in its development as a result of management's consistent and successful execution of the Company's long-term strategy of achieving both growth in reserves and commercial production.  The Indian economy continues to suffer from a shortage of domestically sourced energy production and Indus remains well placed to contribute to addressing this deficit by working in partnership with the relevant authorities in India.

 

 

 

For further information please contact:

 

Indus Gas Limited

Peter Cockburn

Jonathan Keeling +44 (0) 20 7877 0022

 

Arden Partners plc

Steve Douglas

Ciaran Walsh

Dan Gee-Summons +44 (0) 20 7614 5900  

                                                      

 

        Unaudited Condensed Consolidated Statement of Financial Position

            (All amounts in US$, unless otherwise stated)

 

Notes

As at

30 September 2018

As at

30 September 2017

As at

31 March 2018

 

 

(Unaudited)

(Unaudited)

(Audited)

 

 

 

 

 

ASSETS

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets: exploration and evaluation assets

 

7

 

-

 

-

 

                  -

Property, plant and equipment

8

796,677,681

684,756,815

 742,705,287

Tax assets

 

2,608,056

2,264,090

2,424,527

Other assets

 

774

885

            709

Total non-current assets

 

799,286,511

687,021,790

 745,130,523

Current assets

 

 

 

 

Inventories

 

8,607,174

5,860,552

8,341,084

Trade receivables

 

15,642,575

11,879,600

18,185,854

Recoverable from related party

 

62,071,616

-

13,914,912

Other current assets

 

                    54,056

74,368

34,296

Cash and cash equivalents

 

864,273

1,674,929

13,342,498

Total current assets

 

87,239,694

19,489,449

53,818,644

Total assets

 

886,526,205

706,511,239

798,949,167

 

 

 

 

 

LIABILITIES AND EQUITY

 

                                

 

 

Shareholders' equity

 

 

 

 

Share capital

 

             36,19,443

             36,19,443

3,619,443

Additional paid-in capital

 

46,733,689

46,733,689

46,733,689

Currency translation reserve

 

(9,313,781)

(9,313,781)

(9,313,781)

Merger reserve

 

19,570,288

19,570,288

19,570,288

Retained earnings

 

119,981,026

84,357,719

102,268,993

Total  shareholders' equity

 

180,590,665

144,967,358

162,878,632

 

 

LIABILITIES

 

 

 

 

Non-current liabilities

 

 

 

 

Long term debt , excluding current portion

9

268,180,256

151,559,044

287,451,403

Provision for decommissioning

 

1,520,200

1,426,125

1,581,096

Deferred tax liabilities (net)

 

78,885,614

66,768,667

73,031,531

Payable to related parties, excluding current portion

11

287,040,489

171,354,704

204,640,627

Deferred revenue

 

25,563,995

25,563,995

25,563,995

Total non-current liabilities

 

661,190,554

416,672,535

592,268,652

Current liabilities

 

 

 

 

Current portion of long term debt

9

37,640,707

116,535,739

37,299,630

Current portion payable to related parties

11

352,985

23,137,203

355,496

Accrued expenses and other liabilities

 

1,674,208

121,318

1,069,671

Deferred revenue

 

5,077,086

5,077,086

5,077,086

Total current liabilities

 

44,744,986

144,871,346

43,801,883

Total liabilities

 

705,935,540

561,543,881

636,070,535

Total liabilities and equity

 

886,526,205

706,511,239

798,949,167

 

(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)

 

Unaudited Condensed Consolidated Statement of Comprehensive Income

(All amounts in US $, unless otherwise stated)

 

Notes

Six months ended

30 September 2018

 

     Six month ended

30 September 2017

 

 

 

Unaudited

 

Unaudited

 

Revenue                                

 

27,775,085

 

29,391,480

 

Cost of sales

 

(3,218,897)

 

(2,688,457)

 

Administrative expenses

 

(1,132,978)

 

(1,071,345)

 

 

 

 

 

 

 

Profit from operations

 

23,423,210

 

25,631,678

 

Foreign exchange gain/(loss), net

 

142,884

 

(1,993,054)

 

Interest income

 

22

 

45

 

Profit before tax

 

23,566,116

 

23,638,669

 

 

 

 

 

 

 

Income taxes

 -Deferred tax charge

 

 

(5,854,083)

 

 

(7,920,563)

 

 

 

Profit for the period (attributable                                                                                 17,712,033                    15,718,106

to the shareholder of the Group)

 

 

 

 

Total comprehensive income for the period (attributable to the shareholders of the Group)

 

 

17,712,033

  15,718,106

Earnings per share

 

12

 

 

Basic

 

 

0.10

0.09

Diluted

 

 

0.10

0.09

 

 

 

 

 

(The ((The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)

 

 

 

Unaudited Condensed Consolidated Statement of Changes in Equity

(All amounts in US $, unless otherwise stated)

 

Share capital Number   Amount

Additional paid-in capital

Currency translation reserve

Merger reserve

Share option reserve

(Accumulated losses)/ Retained earnings

Total stockholders' equity

 

 

 

Balance as at 1 April 2018

 

182,973,924

3,619,443

46,733,689

(9,313,781)

19,570,288

-

102,268,993

162,878,632

Profit for the period

-

-

-

-

-

-

17,712,033

17,712,033

Total comprehensive income  for the period

-

-

-

-

-

-

17,712,033

17,712,033

Balance as at 30 September 2018

 

182,973,924

3,619,443

46,733,689

(9,313,781)

19,570,288

-

119,981,026

180,590,665

                     

 

 

 

Balance as at 1 April 2017

 

182,973,924

3,619,443

46,733,689

(9,313,781)

19,570,288

-

68,639,613

129,249,252

Profit for the period

-

-

-

-

-

-

15,718,106

15,718,106

Total comprehensive income  for the period

-

-

-

-

-

-

15,718,106

15,718,106

Balance as at 30 September 2017

 

182,973,924

3,619,443

46,733,689

(9,313,781)

19,570,288

-

84,357,719

144,967,358

 

(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)

 

Unaudited Condensed Consolidated Statement of Cash Flows

(All amounts in US $, unless otherwise stated)

 

 

Six months ended

30 September 2018

(Unaudited)

 

Six months ended

30 September 2017

(Unaudited)

 

(A) Cash flow from operating activities

 

 

 

 

 

Profit before tax

 

23,566,116

 

23,638,669

 

Adjustments

 

 

 

 

 

 

(142,884)

 

1,993,054

 

Interest income

 

(22)

 

(45)

 

Depreciation

 

2,520,327

 

2,215,281

 

Changes in operating assets and liabilities

 

 

 

 

 

Inventories

 

(266,090)

 

(279,049)

 

Trade receivables

 

2,543,379

 

(9,834,346)

 

Trade and other payables

 

3,171,638

 

2,899,807

 

Other current and non-current assets

 

(19,825)

 

(35,584)

 

Provisions for decommissioning

 

(60,896)

 

105,092

 

Other liabilities

 

602,026

 

96,745

 

Cash generated from operations

 

31,913,769

 

20,799,624

 

Income taxes paid

 

(183,529)

 

(98,780)

 

Net cash generated from operating activities

 

31,730,240

 

20,700,844

 

 

(B) Cash flow from investing activities

 

 

 

 

 

Purchase of property, plant and equipment A

 

 (92,694,415)

 

(18,271,141)

 

Interest received

 

22

 

35

 

Net cash used in investing activities

 

(92,694,393)

 

(18,271,106)

 

 

(C) Cash flow from financing activities

 

 

 

 

Repayment of long term debt from banks

 

(18,642,570)

(20,828,000)

 

Proceed from Related Party

 

78,449,952

17,209,839

 

Payment of interest

 

(11,464,739)

(8,539,329)

 

Net cash generated from/(used in) financing activities

 

48,342,643

(12,157,490)

 

Net change in cash and cash equivalents

 

(12,621,510)

(9,727,752)

 

Cash and cash equivalents at the beginning of the period

 

13,342,498

11,401,788

 

Effect of exchange rate change on cash and cash equivalents

 

   143,285

                   893

 

Cash and cash equivalents at the end of the period

 

     864,273

     1,674,929

 

 

 

 

 

 

                           

 

A The purchase of property, plant and equipment above, includes additions to exploration and evaluation assets amounting to Nil (previous period: US$ 13,623,183) transferred to development cost, as explained in Note 7.

 

 (The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)

 

 

 

Notes to Unaudited Condensed Consolidated Interim Financial Statements

(All amounts in US $, unless otherwise stated) 

1.    INTRODUCTION

Indus Gas Limited ("Indus Gas" or "the Company") was incorporated in the Island of Guernsey on 4 March 2008 pursuant to an Act of the Royal Court of the Island of Guernsey. The Company was set up to act as the holding company of iServices Investments Limited. ("iServices") and Newbury Oil Co. Limited ("Newbury"). iServices and Newbury are companies incorporated in Mauritius and Cyprus, respectively. iServices was incorporated on 18 June 2003 and Newbury was incorporated on 17 February 2005. The Company was listed on the Alternative Investment Market (AIM) of the London Stock Exchange on 6 June 2008. Indus Gas through its wholly owned subsidiaries iServices and Newbury (hereinafter collectively referred to as "the Group") is engaged in the business of oil and gas exploration, development and production.

 

Focus Energy Limited ("Focus"), an entity incorporated in India, entered into a Production Sharing Contract ("PSC") with the Government of India ("GOI") and Oil and Natural Gas Corporation Limited ("ONGC") on 30 June 1998 for petroleum exploration and development concession in India known as RJ-ON/06 ("the Block"). Focus is the Operator of the Block. On 13 January 2006, iServices and Newbury entered into an interest sharing agreement with Focus and obtained a 65 per cent and 25 per cent share respectively in the Block. Consequent to this, the Group acquired an aggregate of 90 per cent participating interest in the Block and the balance 10 per cent of participating interest is owned by Focus. The participating interest explained above is subject to any option exercised by ONGC in respect of individual wells (already exercised for SGL field as further explained in Note 4).

 

2.   BASIS OF PREPARATION

The unaudited condensed consolidated interim financial statements are for the six months ended 30 September 2018 and are presented in United States Dollar (US$), which is the functional currency of the parent company and other entities in the Group. They have been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all of the information required in annual financial statements in accordance with International Financial Reporting Standards as adopted by the European union, and should be read in conjunction with the consolidated financial statements and related notes of the Group for the year ended 31 March 2018.

 

The unaudited condensed consolidated interim financial statements have been prepared on a going concern basis.

 

The accounting policies applied in these unaudited condensed consolidated interim financial statements are consistent with the policies that were applied for the preparation of the consolidated financial statements for the year ended 31 March 2018.

 

These unaudited condensed consolidated interim financial statements are for the six months ended 30 September 2018 and have been approved for issue by the Board of Directors. ---------

 

 

 

 

 

3.   STANDARDS AND INTERPRETATIONS ISSUED BUT NOT EFFECTIVE AND YET TO BE APPLIED BY THE GROUP

 

Summarised in the paragraphs below are standards, interpretations or amendments that have been issued prior to the date of approval of these consolidated financial statements and endorsed by EU and will be applicable for transactions in the Group but are not yet effective. These have not been adopted early by the Group and accordingly, have not been considered in the preparation of the consolidated financial statements of the Group.

 

Management anticipates that all of these pronouncements will be adopted by the Group in the first accounting period beginning after the effective date of each of the pronouncements. Information on the new standards, interpretations and amendments that are expected to be relevant to the Group's consolidated financial statements is provided below.

 

- IFRS 16 Leases

 

On 13 January 2016, the IASB issued the final version of IFRS 16, Leases. IFRS 16 will replace the existing leases Standard, IAS 17 Leases, and related interpretations. The standard sets out the principles for the recognition, measurement, presentation and disclosure of leases. IFRS 16 introduces a single lessee accounting model and requires a lessee to recognize assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset is of low value. The Standard also contains enhanced disclosure requirements for lessees. The effective date for adoption of IFRS 16 is annual periods beginning on or after 1 January 2019 (but not yet endorsed in EU), though early adoption is permitted for companies applying IFRS 15 Revenue from Contracts with Customers.

 

Management is currently evaluating the impact that this new standard will have on its consolidated    financial statements.

 

- IFRIC 22 Foreign Currency Transactions and Advance Consideration

 

The amendment clarifies that, in determining the spot exchange rate to use on initial recognition of the related asset, expense or income (or part of it) on the derecognition of a non-monetary asset or nonmonetary liability relating to advance consideration, the date of the transaction is the date on which an entity initially recognises the non-monetary asset or non-monetary liability arising from the advance consideration. If there are multiple payments or receipts in advance, then the entity must determine the transaction date for each payment or receipt of advance consideration. Entities may apply the amendments on a fully retrospective basis. Alternatively, an entity may apply the Interpretation prospectively to all assets, expenses and income in its scope that are initially recognized on or after:

(i) The beginning of the reporting period in which the entity first applies the interpretation or

(ii) The beginning of a prior reporting period presented as comparative information in the financial

statements of the reporting period in which the entity first applies the interpretation.

 

Management is currently evaluating the impact that this new standard will have on its consolidated financial statements.

 

4.  JOINTLY CONTROLLED ASSETS

 

The Group participates in an unincorporated joint arrangement with Focus wherein the Group's interest in this arrangement was classified as jointly controlled assets. Following implementation of IFRS 11: Joint Arrangements, the Group's interest in this arrangement is now classified as Joint operation. All rights and obligations in respect of exploration, development and production of oil and gas resources under the 'Interest sharing agreement' are shared between Focus, iServices and Newbury in the ratio of 10 per cent, 65 per cent and 25 per cent respectively.

 

Under the PSC, the GOI, through ONGC had an option to acquire a 30 per cent participating interest in any discovered field, upon such successful discovery of oil or gas reserves, which has been declared as commercially feasible to develop.

 

Subsequent to the declaration of commercial discovery in SGL field on 21 January 2008, ONGC had exercised the option to acquire a 30 per cent participating interest in the discovered fields on 6 June 2008. The exercise of this option would reduce the interest of the existing partners proportionately.

 

On exercise of this option, ONGC is liable to pay its share of 30 per cent of the SGL field development costs and production costs incurred after 21 January 2008 and are entitled to a 30 per cent share in the production of gas subject to recovery of contract costs as explained below. 

 

The allocation of the production from the field to each participant in any year is determined on the basis of the respective proportion of each participant's cumulative unrecovered contract costs as at the end of the previous year or where there are no unrecovered contract cost at the end of previous year on the basis of participating interest of each such participant in the field. For recovery of past contract cost, production from the field is first allocated towards exploration and evaluation cost and thereafter towards development cost.

 

On the basis of above, gas production for the period ended 30 September 2018 is shared between Focus, iServices and Newbury in the ratio of 10 percent, 65 percent and 25 percent respectively.

 

The aggregate amounts relating to jointly controlled assets, liabilities, expenses and commitments related thereto that have been included in the consolidated financial statements are as follows:

 

 

Particular

         Period ended

30 September 2018

    (Unaudited)

       Period ended

30 September 2017

  (Unaudited)

Year ended

31 March 2018

(Audited)

Non-current assets

796,677,681

684,756,815

742,705,287

Current assets

70,678,790

5,860,552

22,255,996

Non-current liabilities

1,520,200

1,426,125

1,581,096

Current liabilities

-

22,699,519

-

Expenses (net of finance income)

3,171,638

2,899,807

6,761,016

Commitments

-

-

-

 

 

 

 

 

 

               

Also subsequent to the declaration of commerciality for SSF and SSG discovery on 24 November 2014, ONGC did not exercise the option to acquire 30 percent in respect of SSG and SSF field. The participating interest in SSG and SSF field between Focus, I services and Newbury will remain in the ratio of 10 percent, 65 percent and 25 percent respectively.

 

 

 

 

5.  SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES

 

The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

 

In preparing these unaudited condensed interim consolidated financial statements, the significant judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were consistent with those that applied to the consolidated financial statements as at and for the year ended 31 March 2018.

 

6.  SEGMENT REPORTING

 

Operating segments are identified on the basis of internal reports about components of the Group that are regularly reviewed by the Chief Operating Decision Maker in order to allocate resources to the segments and to assess their performance. The Company considers that it operates in a single operating segment being the production and sale of gas.

 

 

7.  INTANGIBLE ASSETS: EXPLORATION AND EVALUATION ASSETS

 

Intangible assets comprise of exploration and evaluation assets. Movement in intangible assets was as under:

 

Intangible assets: exploration and evaluation assets

Balance at  01 April  2017

                                 -

Additions A

13,623,183

Transfer to development assets B

(13,623,183)

Balance as at 30 September 2017

                               

-

 

 

 

 

Balance at  01 April 2017

                                        -

Additions A

5,927,548

Transfer to development assets B

(5,927,548)

Balance as at 31 March 2018  

 

Balance as at 01 April 2018

                                       -

                     

                                       -

Additions A

-

Transfer to development assets B

-

Balance as at  30 September 2018

                                       -

 

 

 

A The above includes borrowing costs of US$ Nilfor the period ended 30 September 2018 (30 September 2017: US$ 211,423 and 31 March 2018: US$ 898,344). The weighted average capitalisation rate on funds borrowed generally is 6.86 per cent per annum (30 September 2017: 6.31 per cent per annum and 31 March 2018: 6.50 per cent per annum).

 

B On 19 November 2013, Focus Energy Limited submitted an integrated declaration of commerciality (DOC) to the Directorate General of Hydrocarbons, ONGC, the Government of India and the Ministry of Petroleum and Natural Gas. Upon submission of DOC, exploration and evaluation cost incurred on SSF and SSG field was transferred to development cost. Focus continues to carry out further appraisal activities in the Block, and exploration and evaluation cost incurred subsequent to 19 November 2013, to the extent considered recoverable as per DOC submitted by Focus, is immediately transferred on incurrence to development assets.

 

Further, field development plan has been approved by Directorate General of Hydrocarbons ('DGH') as on 23 June 2017. Accordingly, the cost incurred on the aforesaid fields from 23 June 2017 are capitalised directly to development cost.

 

8.  PROPERTY, PLANT AND EQUIPMENT

 

Property, plant and equipment comprise of the following:

 

Cost

 

 

Land

Extended well test equipment

Development/Production assets

Bunk houses

Vehicles

Other assets

Capital work-in-progress

Total

Balance as at 1 April 2018

167,248

4,324,033

777,563,979

5,926,920

4,767,563

1,620,590

1,371,441

795,741,774

Additions

Disposals/Transfers

-

-

99,143,

-

   56,512,061

-

-

-

-

50,952

-

    88,709

-

56,750,865

-

Balance as at 30

September  2018

167,248

4,423,176

 834,076,040

5,926,920

4,764,563

1,671542

  1,460,150

852,492,639

Accumulated depreciation

 

 

 

 

 

 

 

Balance as at 1 April 2018

-

2,105,807

39,645,716

5,652,284

4,059,330

1,573,350

-

53,036,487

Depreciation for the period

  - 

86,608

2,520,327

64,916

91,942

14,678

-

2,778,471

Balance as at 30 September 2018

    -  

2,192,415

42,166,043

5,717,200

4,151,272

1,588,028

-

55,814,958

Carrying value

 

 

 

 

 

 

 

 

As at 30 September 2018

167,248

2,230,761

791,909,997

209,720

616,291

83,514

1,460,150

796,677,681

 

 

 

 

 

 

 

 

 

 

 

 

 

                                           (This space is intentionally left blank)

 

 

 

 

 

 

 

 

 

 

 

Cost

 

 

Land

Extended well test equipment

Development/Production assets

Bunk houses

Vehicles

Other assets

Capital work-in-progress

Total

 

Balance as at  1 April 2017

167,248

4,120,043

688,879,299

5,926,920

4,734,619

15,76,976

1,317,908

686,722,923

 

Additions                           

 

203,990

108,684,770

 

32,944

43,614

53,533

109,018,851

 

Disposals

 

 

 

 

 

 

 

 

 

Balance as at 31 March 2018

167,248 

4,324,033

777,563,979

5,926,920

4,767,563

1,620,590

1,371,441

795,741,774

 

Accumulated Depreciation

 

 

 

 

 

 

 

 

Balance as at  1 April  2017

             -

1,870,614

34,233,251

5,388,608

3,867,798

1,500,482

-

46,860,753

 

Depreciation for the year                                                                           

             -

235,193

5,412,465

263,676

191,532

72,868

-

6,175,734

 

Balance as at  31 March 2018                                

 

2,105,807

39,645,716

5,652,284

4,059,330

1,573,350

-

53,036,487

 

 

 

 

 

 

 

 

 

 

 

Carrying value as at 31 March 2018

167,248

2,218,226               

737,918,263

274,636

708,233

47,240

1,371,441          

742,705,287

 

 

 

 

 

 

 

 

 

 

 

 

Cost

Land

Extended well test equipment

Development/Production assets

Bunk Houses

Vehicles

Other assets

Capital work-in-progress

Total

 

Balance as at 1 April 2017

167,248

4,120,043

668,879,209

5,926,920

4,734,619

1,576,976

1,317,908

686,722,923

 

Additions

-

198,669

   47,332,757

7,370

29,689

10,216

43,795

47,622,496

 

Balance as at  30 September  2017

167,248

4,318,712

  716,211,966

5,934,290

4,764,308

1,587,192

1,361,703

734,345,419

 

Accumulated depreciation

 

 

 

 

 

 

 

 

Balance as at 1 April 2017

-

1,870,614

34,233,251

5,388,608

3,867,798

1,500,482

46,860,753

 

Depreciation for the period

  - 

150,381

2,215,281

193,711

99,563

68,915

-

2,727,851

 

Balance as at 30 September 2017

 

    -  

2,020,995

36,448,532

5,582,319

3,967,361

1,569,397

-

49,588,604

 

Carrying value

 

 

 

 

 

 

 

 

 

As at 30 September 2017

167,248

2,297,717

679,763,434

351,9711

796,947

17,795

1,361,703

684,756,815

 

 

 

Borrowing costs capitalised for the period ended 30 September 2018 amounted to US$ 15,126,753 (30 September 2017: US$ 14,289,270 and 31 March 2018: US$ 32,077,622).

 

 

 

 

 

 

 

 

9.  LONG TERM DEBT FROM BANKS

 

 

Maturity

30 September 2018

(Unaudited)

30 September 2017

(Unaudited)

31 March 2018

(Audited)

 

Non-current portion of long term debt

2018/2021

118,303,124

151,559,044

137,661,359

Current portion of long term debt from banks

 

34,140,022

40,405,397

32,991,123

Total

 

152,443,146

191,964,441

170,652,482

 

 

 

Current interest rates are variable and weighted average interest for the period was 6.63 per cent per annum (30 September 2017: 6.31 per cent per annum and 31 March 2018: 6.50 per cent per annum). The fair value of the above variable rate borrowings are considered to approximate their carrying amounts.

 

The term loans are secured by following :-

·         First charge on all project assets of the Group both present and future, to the extent of SGL Field. Development. and to the extent of capex incurred out of this facility in the rest of RJ-ON/6 field.

·          First charge on the current assets (inclusive of condensate receivable) of the Group to the extent of SGL field.

·          First Charge on the entire current assets of the SGL Field and to the extent of capex incurred out of this facility in the rest of RJON/6 field.

 

From Bonds

 

 

Maturity

30 September 2018

(Unaudited)

30 September 2017

(Unaudited)

31 March 2018

(Audited)

 

Non-current portion of long term debt

2022

149,877,132

-

149,790,044

Current portion of long term debt from banks

 

3,500,685

76,130,342

4,308,507

Total

 

153,377,817

76,130,342

154,098,551

 

 

During the period ended 31 March 2018, the Group has issued USD 150 million notes under the US$ 300 million MTN programme carries interest rate of 8 per cent per annum. These notes are unsecured notes and are fully repayable at the end of 5 years i.e. December 2022 further interest on these notes will be paid semi-annually.

 

 

10.  RELATED PARTY TRANSACTIONS

 

The related parties for each of the entities in the Group have been summarised in the table below:

 

Nature of the relationship

Related Party's Name

 

 

I. Holding Company

Gynia Holdings Ltd.

 

 

II. Ultimate Holding Company

Multi Asset Holdings Ltd. (Holding Company of Gynia Holdings Ltd.)

III.Enterprise over which Key Management Personnel (KMP) exercise control (with whom there are transactions)

Focus Energy Limited

 

Disclosure of transactions between the Group and related parties and the outstanding balances as of 30 September 2018, 30 September 2017 and 31 March 2018 are as follows:

 

Transactions during the period

Particulars

 

Period ended

30 September 2018

Period ended

30 September 2017

 

Transactions with the Holding Company

 

 

 

 

Amount Received

Interest accrued

 

78,449,950

3,949,913

17,209,839

5,072,871

 

 

 

 

Transactions with KMP

 

 

 

Short term employee benefits

 

78,815

150,013

 

 

 

 

Entity over which KMP exercise control

 

 

 

Share of cost incurred by the Focus in respect of the Block

 

42,383,977

33,727,257

Remittances

 

90,780,000

16,870,000

 

 

 

 

           

 

11. PAYABLE TO RELATED PARTIES

 

Particulars

As at

30 September 2018

As at

30 September 2017

As at

31 March 2018

Entity over which KMP exercise control

 

 

 

Payable to Focus Energy Limited

(62,071,616)

22,699,519

(13,914,912)

Payable with the Holding Company

 

 

 

Payables to Gynia Holding Limited

287,040,489

171,354,704

204,640,627

Payable to KMP

 

 

 

Employee obligation

352,985

437,684

355,496

 

 

 

 

 

Directors' remuneration

Directors' remuneration is included under administrative expenses, evaluation and exploration assets or development assets in the unaudited consolidated financial statements allocated on a systematic and rational manner.

 

Advance for expenditure/Liability payable to Focus

 

Amounts recoverable from Focus represents advance for expenditure for contract cost in Block RJ-ON/6.

 

 

Liability payable to Gynia

* Borrowings from Gynia Holdings Ltd. carries interest rate of 6.5 per cent per annum compounded annually. During the current year, the entire outstanding balance (including interest) was made subordinate to the loans taken from the banks and therefore, is payable along with related interest subsequent to repayment of bank loan in year 2024. Gynia Holding Limited has agreed not to charge any interest on the additional amount of loan given in the year 2017-18 and 2018-19 for a period of two years

 

Interest capitalised on loans above have been disclosed in notes 7 and 8.

 

12. EARNINGS PER SHARE

 

The calculation of the earnings per share is based on the profits attributable to ordinary shareholders divided by the weighted average number of shares issued during the period.

 

Calculation of basic and diluted earnings per share is as follows:

 

 

 

Period ended

30 September 2018

Period ended

30 September 2017

 

 

 

 

Profit attributable to shareholders of Indus Gas Limited, for basic and dilutive

 

17,712,033

15,718,106

Weighted average number of shares (used for basic profit per share)

 

182,973,924

182,973,924

No. of equivalent shares in respect of outstanding options

 

-

-

Diluted weighted average number of shares (used for diluted profit per share

 

182,973,924

 

182,973,924

 

 

 

 

 

Basic earnings per share (US$)

 

0.10*

0.09*

Diluted earnings per share (US$)

 

0.10*

0.09*

 

*Rounded off to the nearest two decimal places.

 

 

13.  COMMITMENTS AND CONTINGENCIES

 

At 30 September 2018, the Group had capital commitments of US$ Nil (30 September 2017: US$ Nil; 31 March 2018: US$ Nil) in relation to property, plant & equipment - development/producing assets, in the Block.

 

The Group has no contingencies as at 30 September 2018 (30 September 2017: Nil; 31 March 2018: Nil).

 

 

14.  FINANCIAL RISK MANAGEMENT

 

The Group's financial risk management objectives and policies are consistent with those disclosed in the consolidated financial statements as at and for the year ended 31 March 2018.

 

 

 

15.  INCOME TAX CREDIT

Indus Gas profits are taxable as per the tax laws applicable in Guernsey where zero per cent tax rate has been prescribed for corporates. Accordingly, there is no tax liability for the Group in Guernsey. iServices and Newbury being participants in the PSC are covered under the Indian Income tax laws as well as tax laws for their respective countries. However, considering the existence of double tax avoidance arrangement between Cyprus and India, and Mauritius and India, profits in Newbury and iServices are not likely to attract any additional tax in their local jurisdiction. Under Indian tax laws, Newbury and iServices are allowed to claim the entire expenditure in respect of the Oil Block incurred until the start of commercial production (whether included in the exploration and evaluation assets or development assets) as deductible expense in the first year of commercial production or over a period of 10 years. The Company has opted to claim the expenditure in the first year of commercial production. As the Group has commenced commercial production in 2011 and has generated profits in Newbury and iServices, the management believes there is reasonable certainty of utilisation of such losses in the future years and thus a deferred tax asset has been created in respect of these.

16.  BASIS OF GOING CONCERN ASSUMPTION

As at 30 September 2018, the Group had current liabilities amounting to US$ 44,744,986 majority of which is towards current portion of borrowings from banks and related parties. As at 30 September 2018, the amounts due for repayment (including interest payable) within the next 12 months for long term borrowings are US$ 37,640,707 which the Group expects to meet from its internal generation of cash from operations and by raising additional funds through debt/bond.

 

17.  FINANCIAL INSTRUMENTS

A summary of the Group's financial assets and liabilities by category is mentioned in the table below.

The carrying amounts of the Group's financial assets and liabilities as recognised at the end of the reporting periods under review may also be categorised as follows:

 

30 September 2018

30 September 2017

31 March 2018

 

Non-current assets

 

 

 

 

-Other assets

774

885

-

 

Current assets

 

 

 

 

-Trade receivables

-Receivables from related party

15,642,575

62,071,616-

11,879,600

-

18,185,854

13,914,912

 

-Cash and cash equivalents

864,273

  1,674,929  

13,342,498

 

Total financial assets

78,579,238

 13,555,414

45,443,264

 

Financial liabilities measured at amortised cost

Non-current liabilities

 

 

 

-  Long term debt from banks

268,180,256

151,559,044

287,451,403

-  Payable to related parties

287,040,489

 171,354,704

204,640,627

Current liabilities

 

 

 

-  Long term debt from banks

37,640,707

116,535,739

37,299,630

-  Payable to related parties

352,985

23,137,203

355,496

-  Accrued expenses and other liabilities

1,674,208

121,318

1,069,671

Total financial liability measured at amortized cost

594,888,645

462,708,008

530,816,827

           

The fair value of the financial assets and liabilities described above closely approximates their carrying value on the statement of financial position dates.


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