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Indus Gas Limited (INDI)

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Tuesday 31 December, 2019

Indus Gas Limited

Half-year Report

RNS Number : 3174Y
Indus Gas Limited
31 December 2019
 

 

Indus Gas Limited and its subsidiaries

("Indus" or the "Company")

 

Unaudited Condensed Consolidated Interim Financial

Statements for the six month period ended 30 September 2019

 

Indus Gas Limited (AIM:INDI.L), an oil & gas exploration and development company, is pleased to report its interim results for the six month period ending 30 September 2019.

Consolidated reported adjusted revenues, operating profit and profit before tax for the interim period ending 30 September 2019 were US$ 27.69m (US$ 27.78 interim 2018), US$ 26.30m (US$ 23.42m interim 2018) and US$ 26.11m (US$ 23.57m interim 2018) respectively.

The Company has continued to make provision for a notional deferred tax liability of US$ 1.68m (US$ 5.85m interim 2018), in accordance with IFRS requirements.

The Petroleum & Natural Gas Regulatory Board ("PNGRB") have invited bids for the laying of a gas pipeline from RJ-ON/6 Block for a new pipeline route so that the pipeline tariff is minimized.  Approvals from the Directorate General of Hydrocarbons ('DGH') and Government had already been received for the development and enhanced production covering a total field area of 2176 sq. km with approved gas reserves of 1.8 tcf.

Commenting, Peter Cockburn, Chairman of Indus, said:

"While the approval of an integrated Field Development Plan ('FDP') for SSG and SSF and a revised FDP for SGL is already in place, the evacuation of gas through a new pipeline at an appropriate tariff will accelerate the monetization of our gas reserves."

For further information, please contact:

 

Indus Gas Limited

Peter Cockburn

Jonathan Keeling +44 (0) 20 7877 0022

 

Arden Partners plc

Ciaran Walsh / Steve Douglas / Dan Gee-Summons (Corporate Finance) +44 (0) 20 7614 5900

James Reed-Daunter (Equity Sales)

 

Unaudited Condensed Consolidated Statement of Financial Position

 

Notes

As at

30 September 2019

As at

30 September 2018

As at

31 March 2019

 

 

(Unaudited)

(Unaudited)

(Audited)

 

 

 

 

 

ASSETS

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets: exploration and evaluation assets

 

6

 

-

 

-

 

-

Property, plant and equipment

7

909,083,224

796,677,681

 851,277,557

Tax assets

 

2,099,982

2,608,056

2,695,055

Other assets

 

590

774

605

Total non-current assets

 

911,183,796

799,286,511

 853,973,217

Current assets

 

 

 

 

Inventories

 

6,309,798

8,607,174

9,327,984

Trade receivables

 

25,865,383

15,642,575

27,617,626

Recoverable from related party

 

74,920,236

62,071,616

57,098,640

Other current assets

 

  49,807

  54,056

10,957

Cash and cash equivalents

 

6,296,967

864,273

129,152

Total current assets

 

113,442,191

87,239,694

94,184,359

Total assets

 

1,024,625,987

886,526,205

948,157,576

 

 

 

 

 

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

 

(9,313,782)

(9,313,781)

(9,313,782)

Merger reserve

 

19,570,288

19,570,288

19,570,288

Retained earnings

 

164,183,991

119,981,026

139,755,664

Total shareholders' equity

 

224,793,629

180,590,665

200,365,302

 

(All amounts in US$, unless otherwise stated)

 

LIABILITIES

 

 

 

 

Non-current liabilities

 

 

 

 

Long term debt , excluding current portion

8

232,246,203

268,180,256

249,722,044

 

Provision for decommissioning

 

1,707,761

1,520,200

1,606,825

 

Deferred tax liabilities (net)

 

91,125,648

78,885,614

89,442,675

 

Payable to related parties, excluding current portion

10

400,835,351

297,040,487

331,088,491

 

Deferred revenue

 

25,563,995

25,563,995

25,563,995

 

Total non-current liabilities

 

751,478,958

661,190,554

697,424,030

 

Current liabilities

 

 

 

 

 

Current portion of long-term debt

8

40,909,823

37,640,707

42,869,400

 

Current portion payable to related parties

10

352,534

352,985

352,909

 

Accrued expenses and other liabilities

 

2,013,957

1,674,208

2,068,849

 

Deferred revenue

 

5,077,086

5,077,086

5,077,086

 

Total current liabilities

 

48,353,400

44,744,986

50,368,244

 

Total liabilities

 

799,832,358

705,935,540

747,792,274

 

Total liabilities and equity

 

1,024,625,987

886,526,205

948,157,576

 

                 

 

(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 2019

 

 Six months ended

30 September 2018

 

 

 

Unaudited

 

Unaudited

 

Revenue  

 

27,690,196

 

27,775,085

 

Cost of sales

 

(1,089,176)

 

(3,218,897)

 

Administrative expenses

 

 (303,970)

 

(1,132,978)

 

 

 

 

 

 

 

Profit from operations

 

26,297,050

 

23,423,210

 

Foreign exchange gain/(loss), net

 

(245,732)

 

142,884

 

Interest income

 

59,984

 

22

 

Profit before tax

 

26,111,302

 

23,566,116

 

 

 

 

 

 

 

Income taxes

 -Deferred tax charge

 

 

(1,682,975)

 

 

(5,854,083)

 

Profit for the period (attributable to the shareholder of the Group)

 

24,428,327

 

17,712,033

 

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

 

24,428,327

 

17,712,033

 

Earnings per share

 

 

 

 

 

Basic

 

0.13

 

0.10

 

Diluted

 

0.13

 

0.10

 

                     

 

 

(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 2019

 

182,973,924

3,619,443

46,733,689

(9,313,782)

19,570,288

-

139,755,664

200,365,302

Profit for the period

-

-

-

-

-

-

24,428,327

24,428,327

Total comprehensive income for the period

-

-

-

-

-

-

24,428,327

24,428,327

Balance as at 30 September 2019

182,973,924

3,619,443

46,733,689

(9,313,782)

19,570,288

-

164,183,991

224,793,629

                     

 

 

 

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

 

(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 2019

(Unaudited)

 

Six months ended

30 September 2018

(Unaudited)

 

(A) Cash flow from operating activities

 

 

 

 

 

Profit before tax

 

26,111,302

 

23,566,116

 

Adjustments

 

 

 

 

 

Unrealised exchange loss/ (gain)

 

245,732

 

(142,884)

 

Interest income

 

(59,984)

 

(22)

 

Depreciation

 

858,756

 

2,520,327

 

Changes in operating assets and liabilities

 

 

 

 

 

Inventories

 

3,018,186

 

(266,090)

 

Trade receivables

 

1,752,243

 

2,543,379

 

Trade and other payables

 

1,136,238

 

3,171,638

 

Other current and non-current assets

 

(38,850)

 

(19,825)

 

Provisions for decommissioning

 

100,936

 

(60,896)

 

Other liabilities

 

(55,267)

 

602,026

 

Cash generated from operations

 

33,069,292

 

31,913,769

 

Income taxes paid/refund

 

595,083

 

(183,529)

 

Net cash generated from operating activities

 

33,664,375

 

31,730,240

 

 

(B) Cash flow from investing activities

 

 

 

 

 

Purchase of property, plant and equipment A

 

 (54,313,241)

 

 (92,694,415)

 

Interest received

 

59,984

 

22

 

Net cash used in investing activities

 

 (54,253,257)

 

(92,694,393)

 

 

(C) Cash flow from financing activities

 

 

 

 

Repayment of long-term debt from banks

 

(20,034,000)

(18,642,570)

 

Proceed from Related Party

 

57,600,000

78,449,952

 

Payment of interest

 

(10,563,571)

(11,464,739)

 

Net cash generated from/(used in) financing activities

 

27,002,429

48,342,643

 

Net change in cash and cash equivalents

 

6,413,547

(12,621,510)

 

Cash and cash equivalents at the beginning of the period

 

129,152

13,342,498

 

Effect of exchange rate change on cash and cash equivalents

 

(245,732)

 143,285

 

Cash and cash equivalents at the end of the period

 

6,296,967

864,273

 

 

 

 

 

 

                           

 

A The purchase of property, plant and equipment above, includes additions to exploration and evaluation assets amounting to US$ 3,613,943 (previous period: Nil) 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 3).

2.   BASIS OF PREPARATION

The unaudited condensed consolidated interim financial statements are for the six months ended 30 September 2019 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 2019.

 

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 2019.

 

These unaudited condensed consolidated interim financial statements are for the six months ended 30 September 2019 and have been approved for issue by the Board of Directors.

 

3JOINTLY 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 'Participating 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.

 

The block is divided into 3 fields- SGL, SSF and SSG. 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 is 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 2019 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 2019

    (Unaudited)

 Period ended

30 September 2018

  (Unaudited)

Year ended

31 March 2019

(Audited)

Non-current assets

909,083,224

796,677,681

851,277,557

Current assets

81,230,034

70,678,790

66,426,624

Non-current liabilities

1,707,761

1,520,200

1,606,825

Current liabilities

-

-

     -

Expenses (net of finance income)

1,136,238

3,171,638

     4,697,750

Commitments

   -

    -

    -

 

 

 

 

 

 

 

               

Further, the SSF and SSG field has also received its declaration of commerciality on 24th November ,2014. Subsequent to the declaration of commerciality for SSF and SSG discovery, ONGC did not exercise the option to acquire 30 percent in respect of SSF and SSG field. The participating interest in SSF and SSG field between Focus, Iservices and Newbury will remain in ratio of 10 percent, 65 percent and 25 percent respectively for exploration and evaluation cost and production revenue for SSF and SSG in the block.

 

4.  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 2019.

 

5.  SEGMENT REPORTING

 

Operating segments are identified on the basis of internal reports about components of the Group that are regularly reviewed by the management 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.

 

 

6.  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 2019

 - 

 

Additions A

3,793,633

 

Transfer to development assets B

(3,793,633)

 

Balance as at 30 September 2019

-

 

 

Balance at 01 April 2018

    -

Additions A

-

 

Transfer to development assets B

-

 

 

Balance as at 30 September 2018   

 

Balance as at 01 April 2018

   -

   

   -

 

Additions A

9,569,925

 

Transfer to development assets B

(9,569,925)

 

Balance as at 31 March 2019

   -

 

 

 

         

 

A The above includes borrowing costs of US$ 93,383 for the period ended 30 September 2019 (30 September 2018: Nil and 31 March 2019: US$ 314,083). The weighted average capitalisation rate on funds borrowed generally is 6.73 per cent per annum (30 September 2018: 6.86 per cent per annum and 31 March 2019: 6.70 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 DGH as on 23 June 2017. Accordingly, the cost incurred on the aforesaid fields from 23 June 2017 are capitalised directly to development cost. 

7.  PROPERTY, PLANT AND EQUIPMENT

 

Property, plant and equipment comprise of the following:

Cost

 

 

Land

Extended well test equipment

Development Assets

Production Assets

Bunk Houses

Vehicles

Other assets

Capital work-in-progress

Total

Balance as at 1 April 2019

167,248

4,587,730

 678,038,141

   212,011,941

5,926,920

4,773,327

  1,690,100

1,636,932

908,832,339

Additions

Disposals/Transfers

-

-

805

-

   58,639,020

(16,994,002)

16,994,002

-

-

-

-

5,140

-

279,706

-

75,918,673

 (16,994,002)

Balance as at 30

September 2019

167,248

4,588,535

719,683,159

229,005,943

5,926,920

4,773,327

  1,695,240

1,916,638

967,757,010

Accumulated depreciation

 

 

 

 

 

 

 

 

Balance as at 1 April 2019

    -  

2,282,425

-

43,641,189

5,782,117

4,243,213

1,605,838

-

57,554,782

Depreciation for the period

  - 

91,698

-

858,756

55,121

    91,608

21,821

-

   1,119,004

Balance as at 30 September 2019

    -  

2,374,123

     -

44,499,945

5,837,238

4,334,821

1,627,659

-

58,673,786

Carrying value

 

 

 

 

 

 

 

 

 

As at 30 September 2019

167,248

2,214,412

     719,683,159

  184,505,998

89,682

  438,506

 67,581

1,916,638

909,083,224

 

 

Cost

 

 

Land

Extended well test equipment

Development Assets

Production assets

Bunk houses

Vehicles

Other assets

Capital work-in-progress

Total

Balance as at 1 April 2018

167,248

4,324,033

587,114,867

190,449,112

5,926,920

4,767,563

1,620,590

1,371,441

795,741,774

Additions

Disposals/Transfers

-

-

99,143

-

   46,668,030

-

9,844,031

-

-

-

-

50,952

-

88,709

-

56,750,865

    -

Balance as at 30

September 2018

167,248

4,423,176

 638,140,443

200,293,143

5,926,920

4,764,563

1,671,542

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

638,140,443

158,127,100

209,720

616,291

83,514

1,460,150

     796,677,681

 

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

587,114,867

190,449,112

5,926,920

4,767,563

1,620,590

  1,371,441  

795,741,774

Additions

Disposals/Transfers

-

-

263,697

-

  90,923,274

-

21,562,829

-

-

5,764

-

69,510

-

   265,491

-

113,090,565

    -

Balance as at 31 March 2019

167,248

4,587,730

 678,038,141

 212,011,941

    5,926,920

     4,773,327

    1,690,100

     1,636,932

    908,832,339

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

  - 

176,618

-

3,995,473

129,833

183,883

32,488

    -

4,518,295

Balance as at 31 March 2019

    -  

2,282,425

-

43,641,189

    5,782,117

   4,243,213

1,605,838

    -

57,554,782

Carrying value

 

 

 

 

 

 

 

 

 

As at 31 March 2019

167,248

2,305,305

678,038,141

  168,370,752

   144,803

530,114

84,262

   1,636,932

     851,277,557

 

 

Borrowing costs capitalised for the period ended 30 September 2019 amounted to US$ 23,309,017 (30 September 2018: US$ 15,126,753 and 31 March 2019: US$ 41,500,334).

8.  LONG TERM DEBT FROM BANKS

 

 

Maturity

30 September 2019

(Unaudited)

30 September 2018

(Unaudited)

31 March 2019

(Audited)

 

Non-current portion of long term debt

2021/2024

82,061,620

118,303,124

100,003,278

Current portion of long term debt from banks

 

37,276,490

34,140,022

39,171,055

Total

 

119,338,110

152,443,146

139,174,333

 

 

Current interest rates are variable and weighted average interest for the period was 6.73 per cent per annum (30 September 2018: 6.63 per cent per annum and 31 March 2019: 6.70 per cent per annum). The fair value of the above variable rate borrowings is 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 2019

(Unaudited)

30 September 2018

(Unaudited)

31 March 2019

(Audited)

 

Non-current portion of long term debt

2022

150,184,583

149,877,132

149,718,766

Current portion of long term debt from banks

 

3,633,333

3,500,685

3,698,345

 

153,817,916

153,377,817

153,417,111

 

 

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 8.1 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.

 

9.  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 2019 and 30 September 2018 are as follows:

 

Transactions during the period

Particulars

 

Period ended

30 September 2019

Period ended

   30 September 2018

Transactions with the Holding Company

 

 

 

 

Amount Received

Interest paid

 

57,600,000

12,146,860

78,449,950

3,949,913

 

 

 

 

Transactions with KMP

 

 

 

Short term employee benefits

 

97,900

78,815

 

 

 

 

Entity over which KMP exercise control

 

 

 

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

 

32,180,404

42,383,977

Remittances

 

50,002,000

90,780,000

 

 

10. PAYABLE TO RELATED PARTIES

 

Particulars

As at

30 September 2019

As at

30 September 2018

As at

31 March 2019

Entity over which KMP exercise control

 

 

 

Payable to Focus Energy Limited

 

(74,920,236)

(62,071,616)

(57,098,640)

Payable with the Holding Company

 

 

 

Payables to Gynia Holding Limited*

400,835,351

287,040,487

331,088,491

 

Payable to KMP

 

 

 

Employee obligation

352,534

352,985

352,909

 

 

 

 

*including interest

 

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.

 

Amount receivable from Focus

Amount receivable from Focus represents excess amounts paid to them in respect of the Group's share of contract costs, for its participating interest 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. Some part of the outstanding balance (including interest) was made subordinate to the loans taken from the banks as per the sanction terms of the banks and, is payable along with related interest subsequent to repayment of bank loan in year 2024.

Interest capitalised on loans above have been disclosed in notes 6 and 7.

 

11. 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 2019

Period ended

30 September 2018

 

 

 

 

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

 

24,428,327

17,712,033

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$)

 

0.13*

0.10*

Diluted earnings per share (US$)

 

0.13*

0.10*

*Rounded off to the nearest two decimal places.

 

12.  COMMITMENTS AND CONTINGENCIES

 

At 30 September 2019, the Group had capital commitments of US$ Nil (30 September 2018: US$ Nil; 31 March 2019: US$ Nil) in relation to property, plant & equipment - development/producing assets, in the Block. The Group has no contingencies as at 30 September 2019 (30 September 2018: Nil; 31 March 2019: Nil).

 

13.  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 2019.

 

14.  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 incurred in respect to the SGL field. 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.

15.  BASIS OF GOING CONCERN ASSUMPTION

 

As at 30 September 2019, the Group had current liabilities amounting to US$ 48,353,400 majorities of which is towards current portion of borrowings from banks and related parties. As at 30 September 2019, the amounts due for repayment (including interest payable) within the next 12 months for long term borrowings are US$ 40,909,823 which the Group expects to meet from its internal generation of cash from operations.

Further the group is contemplating to raise funds which will be used for planned capital expenditures.

 

16.  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 2019

30 September 2018

31 March 2019

 

Non-current assets

 

 

 

 

-Other assets

590

774

605

 

Current assets

 

 

 

 

-Trade receivables

-Receivables from related party

25,865,383

74,920,236

15,642,575

62,071,616

27,617,626

57,098,640

 

-Cash and cash equivalents

6,296,967

864,273

129,152

 

Total financial assets

107,083,176

78,579,238

84,846,023

 

Financial liabilities measured at amortised cost

Non-current liabilities

 

 

 

-  Long term debt from banks

232,246,203

268,180,256

249,722,044

-  Payable to related parties

400,835,351

297,040,487

331,088,491

Current liabilities

 

 

 

-  Long term debt from banks

40,909,823

37,640,707

42,869,400

-  Payable to related parties

352,534

352,985

352,909

-  Accrued expenses and other liabilities

2,013,957

1,674,208

2,068,849

Total financial liability measured at amortized cost

676,357,868

604,888,643

626,101,693

             

 

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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