TIDMCZN
RNS Number : 3069X
Curzon Energy PLC
30 April 2021
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
30 April 2021
Curzon Energy Plc
("Curzon" or the "Company")
Results for the Year Ended 31 December 2020
Curzon Energy Plc (LON:CZN), ("Curzon" or the "Company"), the
London Stock Exchange listed company, announces its full year
audited results for the year ended 31 December 2020.
A copy of the Company's annual report and financial statements
for the year ended 31 December 2020, extracts of which are set out
below, will be made available on the Company's website
www.curzonenergy.com shortly.
Curzon further announces that a Notice of Annual General Meeting
("AGM") will be posted to shareholders, along with the Annual
Report and Financial Statements for the year ended 31 December
2020, on or before 7 May 2021.
The Company will be holding its AGM at the Company's business
address, which is located at Curzon Energy Plc, (WeWork), 71-91
Aldwych House, London WC2B 4HN on Wednesday 9 June 2021 at 2.00 pm,
the details of which are explained in the Notice of AGM, which will
be also available on the Company's website www.curzonenergy.com
shortly.
Due to the ongoing impact of the COVID-19 pandemic and related
public health guidance, the Company intends to hold the meeting
with a limited number of company representatives, attending in
person, to ensure that a valid meeting is held. Other shareholders
are strongly encouraged not to attend the AGM in person while
government restrictions remain in force. Shareholders and guests
who travel to the meeting may not be admitted if there are safety
constraints.
Given the constantly evolving nature of the situation, if it
subsequently becomes possible to welcome a number of shareholders
to the venue, attendance in this way is likely to be restricted in
terms of numbers and we would therefore still encourage
shareholders not to attend the venue in person. Any updates to the
position will be included on the Company's website and through a
Regulatory Information Service. Shareholders are strongly
encouraged to submit their Forms of Proxy, to ensure they can vote
and be represented at the AGM.
Forms of proxy must be completed, signed and returned so as to
be received by the Company's Registrars no later than 2.00 pm on 7
June 2021.
Scott Kaintz, Chief Executive Officer comments:
"With the initial turmoil of the COVID-19 pandemic and 2020 now
behind us, the Board of Curzon looks forward to progressing its
potential transaction with Poseidon Enhanced Technologies and to
completing the repositioning of Curzon as an ESG centric business
set to play a leading role in the post-pandemic world of
tomorrow."
For further information please
contact:
Curzon Energy Plc +44 (0) 20 7747 9980
Scott Kaintz
www.curzonenergy.com
SP Angel Corporate Finance LLP +44 (0) 20 3470 0470
Richard Hail
Chairman's Statement
I am pleased to present the annual report for Curzon Energy Plc
(the "Company"), covering its results for the year to 31 December
2020.
Period in Review
During the course of 2020, the Company focused its efforts on
completing a potential reverse takeover transaction ("RTO") with
Sun Seven Stars Investment Group ("SSSIG") that did not ultimately
complete. While all parties put in significant amounts of time and
effort towards this goal, and the target itself was considered of
material scale and likely to be of real interest to potential
investors, it was ultimately not possible to combine the various
independent businesses proposed by SSSIG to progress a RTO to
completion. As a result, the Company announced after the period, on
3 February 2021 that it had ceased discussions on a transaction
with SSSIG.
Also on 3 February 2021, the Company announced that it had
entered a period of exclusivity in order to conduct due diligence
and to potentially acquire a 100% interest in Poseidon Enhanced
Technologies Ltd ("PETL" or "Poseidon"), developer of a proprietary
chemical Polyethylene terephthalate ("PET") plastic recycling
technology, whose goal is to convert used PET into 100% recycled
feedstock to support the global food-grade packaging and fibre
industries. PETL's process allows for the conversion of previously
unrecycled plastics such as colored bottles, trays, fibres and
films, converting them directly into Poseidon rBHET, an interim
feedstock for the global PET industry, and fully in line with and
supporting a "Circular Economy".
Poseidon is currently developing its recycling technology at its
facilities in Teesside, UK, and is planning a global industrial
scale roll-out of its technology, following completion of its
listing process and associated capital raise.
Activities at Coos Bay were minimal during the course of the
year, with the project remaining on care and maintenance. The
Company has been exploring formal extensions of the project leases
as well as a potential farm-out or sale of the project more
broadly.
Results
For the period ended 31 December 2020, the Group incurred a loss
of US$617,574 (2019: a loss of US$3,580,750). The majority of this
loss comprised administrative expenses, associated with supporting
the SSSIG transaction as well as required listing and regulatory
overheads. Overall administrative expenses fell during the period
from US$913,572 in 2019 to US$528,799 as the Company continued to
operate with reduced overheads.
Outlook
At the time of writing, the United Kingdom and the larger world
continue to deal with the effects of the COVID-19 pandemic and its
associated volatility. While many commentators quite reasonably
projected an extended economic downturn following the spread of the
COVID-19 pandemic, markets remain exceptionally buoyant, following
various governments' significant economic stimulus packages lifting
valuations and the rise of retail day traders. Meanwhile, during
lockdown, countless individuals have increased their savings rates
whether intentionally or simply due to a lack of viable consumption
options for goods and services. Much of that nascent financial
firepower remains on the sidelines, as do the buildings and capital
infrastructure, largely unaffected by the virus itself, and points
to a potential period of significant financial growth, as well of
course as the looming threat of inflation, as vaccination levels
increase and consumers make up for missed spending opportunities
and lost time.
What is clear is that many of the world's governments from the
United States to Europe have decided to use pandemic recovery
efforts to refocus their attentions on the impact of carbon
emissions and the environment, including sectors such agriculture,
industry, waste, energy and transport. This invigorated
environmental agenda means the opportunity in the Environmental,
Social and Governance (ESG) space that PETL's chemical recycling
addresses is a real one and is only likely to be bolstered by
government spending stimulus and the introduction of further
regulation and legislation by governments in support of this
agenda. Forthcoming virgin plastics penalties in regions such as
the EU are stimulating global brands to invest in and support
companies such as PETL offering 100% recycled plastic solutions and
facilitating some of the world's largest drinks and food brands to
honour their aggressive and very publicly declared recycling
targets. PETL is expected to attract very strong investor interest
and intends to access green bonds and related ESG focused capital
to tackle what is in essence a multi-national challenge; making
plastics a sustainable part of the global economy.
Curzon, after many months of effort, thus finds itself well
positioned with a potential transaction on the leading edge of a
massive global shift towards ESG investments. Through this
transaction, Curzon has ambitious plans to enter a sector involving
the chemical recycling of PET plastics that could not be more in
focus and topical, and where the completion of an RTO is likely to
create a dynamic and high growth recycling entity. This new entity
will appeal to institutional and retail investors alike and will be
one that will help meet one of the world's great environmental
challenges.
So, it is with high expectations that Curzon has begun 2021 and
continues to advance a potential transaction with PETL. We thank
all stakeholders for their support both historically and in the
period ahead as we look to advance and execute on the opportunity
in front of us.
John McGoldrick
Non-Executive Chairman
29 April 20 21
Strategic Report
Financial Results
The Group loss for the year to 31 December 2020 was US$617,574
(2019: US$3,580,750). There were no revenues and the majority of
this loss related to the administrative and listing costs.
The loss per share was US$0.008 (2019: loss per share
US$0.044).
The Group currently has no source of revenue and is reliant on
loans to continue to meet its overhead expenditure. The Group held
cash balances of US$47,188 as at 31 December 2020 and has after the
year end increased its borrowing capacity and current liquidity
through the agreement with Poseidon Enhanced Technologies Ltd.
The Directors note that the Group will need additional funding
to continue operations for the foreseeable future and this means
there is a material uncertainty as to the Group's ability to
continue as a going concern, however, the Directors are confident
that the Group will be able to raise, as required, sufficient cash
or reduce its commitments to enable it to continue its operations
and to continue to meet, as and when they fall due, its liabilities
for at least the next twelve months from the date of approval of
the Group Financial Statements. The Group Financial Statements
have, therefore, been prepared on the going concern basis.
The Group has 3 members of staff (including Directors).
Principal Activities
The Company was incorporated in England and Wales on 29 January
2016 as an investment company to acquire oil and gas assets. Its
first acquisition was of Coos Bay, which has now been wholly
written off.
The Group's business is now operated through the United Kingdom
and is focused on identifying and acquiring a new business in a
promising sector.
Review of the Business
In March 2020, the Company announced that it had executed a
letter of intent with Seven Sun Stars Investment Group ("SSSIG") to
acquire a 100% interest in the London Critical Metals Market
("LCMM"). Following several months of due diligence, LCMM was over
a period of time unable to provide the data required to advance a
reverse takeover process, and as such on 3 February 2021 the
Company terminated these discussions.
On 3 February 2021, the Company announced that it had executed a
letter of intent with Poseidon Enhanced Technologies Ltd to acquire
a 100% interest via a potential RTO. PETL and the Company had
entered a period of exclusivity, where each party will conduct due
diligence on the other. The parties have further agreed that during
this period they will work towards the execution and delivery of a
sale and purchase agreement.
Key Performance Indicators (KPIs)
As the Company is currently pursuing a potential reverse
takeover, the Directors take the view that KPIs would not provide
materially useful information to investors at this time. As the
business develops further, the addition of KPIs will be considered
and added as appropriate.
Principal Risks and Risk Management
As the Company is currently pursuing a reverse takeover, that
would materially change the nature of the business, the primary
risk to the business during this period is going concern risk and a
potential inability to fund the business through the
transition.
The Company's Risk Mitigation Strategies Include the
Following:
-- Utilising the Directors' experience in fundraising to
maintain a balance of funding sources during the period of
transition;
-- Managing the Company's existing debt positions, keeping all
stakeholders up to date and informed as to progress of the
transaction;
-- Judicious use of capital and cost control during the
transition.
Corporate Responsibility
The Company takes its responsibilities as a corporate citizen
seriously. The Board's primary goal is to create shareholder value
in a responsible way, which serves all stakeholders.
Section 172 Statement
Section 172 of the Companies Act 2006 requires Directors to take
into consideration the interests of stakeholders in their decision
making. The Directors continue to have regard to the interests of
the Company's employees and other stakeholders, including the
impact of its activities on the community, the environment and the
Company's reputation, when making decisions. Acting in good faith
and fairly between members, the Directors consider what is most
likely to promote the success of the Company for its members in the
long term.
The Directors are fully aware of their responsibilities to
promote the success of the Company in accordance with section 172
of the Companies Act 2006. The Board regularly reviews our
principal stakeholders and how we engage with them. The stakeholder
voice is brought into the boardroom throughout the annual cycle
through information provided by management and also by direct
engagement with stakeholders themselves. The relevance of each
stakeholder group may increase or decrease depending on the matter
or issue in question, so the Board seeks to consider the needs and
priorities of each stakeholder group during its discussions and as
part of its decision making.
The Board welcomes the opportunity to engage with our
shareholders and with the capital markets more generally. The Board
achieves this through dialogue with shareholders, prospective
shareholders and capital markets participants, including corporate
brokers. Feedback from any such meetings or calls would be shared
with all Board members.
Investors, prospective investors and analysts can contact the
Executive Director as well as access information on our corporate
website. The Board believes that appropriate steps have been taken
during the year so that all members of the Board, and in particular
the non-executive Directors, have an understanding of the views of
major shareholders.
Governance
The Board considers sound governance as a critical component of
the Company's success and the highest priority. The Company has an
effective and engaged Board, with a strong non-executive presence
drawn from diverse backgrounds and with well-functioning governance
committees. Through the Company's compensation policies and
variable components of employee remuneration, the Remuneration
Committee of the Board seeks to ensure that the Company's values
are reinforced in employee behavior and that effective risk
management is promoted.
Analysis by Gender
Category Male Female
Directors 3 0
----- -------
Senior Managers 0 0
----- -------
Other Employees 0 0
----- -------
Employees and Their Development
The Company is dependent upon the qualities and skills of its
employees and their commitment plays a major role in the Company's
business success. Employees' performance is aligned to the
Company's goals through an annual performance review process and
via incentive programs. The Company provides employees with
information about its activities through regular briefings and
other media. The Company operates a Share Option Scheme operated at
the discretion of the Remuneration Committee.
Diversity and Inclusion
The Company does not discriminate on the grounds of age, gender,
nationality, ethnic or racial origin, non-job-related-disability,
sexual orientation or marital status. The Company gives due
consideration to all applications and provides training and the
opportunity for career development wherever possible. The Board
does not support discrimination of any form, positive or negative,
and all appointments are based solely on merit.
Health and Safety
The Company endeavors to ensure that the working environment is
safe and healthy and conducive to the wellbeing of employees, who
are able to balance work and family commitments. The Company has a
Health and Safety at Work Policy, which is reviewed regularly by
the Board and is committed to the health and safety of its
employees and others, who may be affected by the Company's
activities. The Company provides the information, instruction,
training and supervision necessary to ensure that employees are
able to discharge their duties effectively. The health and safety
procedures used by the Company ensure compliance with all
applicable legal, environmental and regulatory requirements as well
as its own internal standards.
Outlook
Both PETL and the Company are currently working to expedite all
aspects of a potential RTO process where such a transaction would
be conditional upon agreeing definitive documentation and receipt
of the required regulatory approvals from the FCA and its primary
market functions, among other matters.
The Board's view is that current market conditions are ideal for
an ESG-focused business such as PETL.
With the world beginning to come out of the COVID-19 pandemic
and government stimulus expected to focus on green energy and
sustainable investment, the Company anticipates that a transaction
with PETL will deliver a dynamic business focused on plastics
recycling with high-growth potential and with excellent ESG
credentials. Such a business is expected to have broad appeal to
both institutional and retail investors and attract appropriate
funding that will allow it to achieve its potential in the coming
years and in so doing help meet one of the world's great
environmental recycling challenges .
After several challenging years, Curzon now seems poised to
transform itself into an exciting and forward-looking proposition
for the benefit of all of our stakeholders.
Signed by order of the Board.
Scott Kaintz
Chief Executive Officer
29 April 2021
Independent Auditor's Report to the Members of Curzon Energy
Plc
Opinion
We have audited the Financial Statements of Curzon Energy Plc
(the "Company") and its subsidiaries (the "Group") for the year
ended 31 December 2020, which comprise the Consolidated Statement
of Comprehensive Income, the Consolidated and Company Statements of
Financial Position, the Consolidated and Company Statements of Cash
Flows, the Consolidated and Company Statements of Changes in Equity
and Notes to the Financial Statements, including a summary of
significant accounting policies. The financial reporting framework
that has been applied in their preparation is applicable law and
International Financial Reporting Standards (IFRSs) as adopted by
the European Union and, as regards the Company, as applied in
accordance with the provisions of the Companies Act 2006.
In our opinion:
-- the Financial Statements give a true and fair view of the
state of the Group's and the Company's affairs as at 31 December
2020 and of the Group's loss for the year then ended;
-- the Group Financial Statements have been properly prepared in
accordance with International Financial Reporting Standards as
adopted by the European Union;
-- the Company Financial Statements have been properly prepared
in accordance with IFRSs as adopted by the European Union as
applied in accordance with the provisions of the Companies Act
2006; and
-- the Financial Statements have been prepared in accordance
with the requirements of the Companies Act 2006.
Basis for Opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the
Auditor's responsibilities for the audit of the Financial
Statements section of our report. We are independent of the Company
in accordance with the ethical requirements that are relevant to
our audit of the Financial Statements in the UK, including the
FRC's Ethical Standard, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe
that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
Material Uncertainty Related to Going Concern
We draw attention to note 2 to the Financial Statements, which
details the factors the Group and the Company has considered, when
assessing the going concern position. As detailed in note 2, the
uncertainty surrounding the availability of funds to finance
ongoing working capital requirements indicates the existence of a
material uncertainty that may cast significant doubt on the
Company's ability to continue as a going concern. Our opinion is
not modified in respect of this matter.
In auditing the Financial Statements, we have concluded that the
Director's use of the going concern basis of accounting in the
preparation of the Financial Statements is appropriate. Our
evaluation of the Directors assessment of the entity's ability to
continue to adopt the going concern basis of accounting included
review of letter of intent with Poseidon Enhanced Technologies Ltd
and cashflow forecast prepared by management.
Our responsibilities and the responsibilities of the Directors
with respect to going concern are described in the relevant
sections of this report.
Overview of Our Audit Approach
Materiality
In planning and performing our audit, we applied the concept of
materiality. An item is considered material if it could reasonably
be expected to change the economic decisions of a user of the
Financial Statements. We used the concept of materiality to both
focus our testing and to evaluate the impact of misstatements
identified.
Based on our professional judgement, we determined overall
materiality for the Financial Statements as a whole to be
GBP35,000, based on 5% of the adjusted results of the year.
We use a different level of materiality ('performance
materiality') to determine the extent of our testing for the audit
of the Financial Statements. Performance materiality is set based
on the audit materiality as adjusted for the judgements made as to
the entity risk and our evaluation of the specific risk of each
audit area having regard to the internal control environment.
Where considered appropriate performance materiality may be
reduced to a lower level, such as, for related party transactions
and Directors' remuneration.
We agreed with the Audit Committee to report to it all
identified errors in excess of GBP1,750. Errors below that
threshold would also be reported to it if, in our opinion as
auditor, disclosure was required on qualitative grounds.
Overview of the Scope of Our Audit
There are two key components of the Group, Curzon Energy Plc as
an entity and the US Group headed by Coos Bay Energy LLC. The audit
of Curzon Energy Plc was conducted from the UK. The accounting
records were provided to us by management.
Key Audit Matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the Financial
Statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) that we identified. These matters included those which had
the greatest effect on: the overall audit strategy, the allocation
of resources in the audit, and directing the efforts of the
engagement team. These matters were addressed in the context of our
audit of the Financial Statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these
matters.
Besides the matter described in the Material Uncertainty Related
to Going Concern section, we have determined no other matters to be
communicated in our report.
Other Information
The Directors are responsible for the other information. The
other information comprises the information included in the Annual
Report, other than the Financial Statements and our Auditor's
Report thereon. Our opinion on the Financial Statements does not
cover the other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
In connection with our audit of the Financial Statements, our
responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent
with the Financial Statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether there is a
material misstatement in the Financial Statements or a material
misstatement of the other information. If, based on the work we
have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact.
We have nothing to report in this regard.
Opinions on Other Matters Prescribed by the Companies Act
2006
In our opinion, the part of the Directors' Remuneration Report
to be audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of
our audit:
-- the information given in the Strategic Report and the
Directors' Report for the financial year for which the Financial
Statements are prepared is consistent with the Financial
Statements; and
-- the Strategic Report and the Directors' Report have been
prepared in accordance with applicable legal requirements.
Matters on which We are Required to Report by Exception
In light of the knowledge and understanding of the Group and the
Parent Company and their environment obtained in the course of the
audit, we have not identified material misstatements in the
Strategic Report or the Directors' Report.
We have nothing to report in respect of the following matters
where the Companies Act 2006 requires us to report to you if, in
our opinion:
-- adequate accounting records have not been kept by the
Company, or returns adequate for our audit have not been received
from branches not visited by us; or
-- the Financial Statements and the part of the Directors'
Remuneration Report to be audited are not in agreement with the
accounting records and returns; or
-- certain disclosures of Directors' remuneration specified by
law are not made; or
-- we have not received all the information and explanations we
require for our audit.
Responsibilities of the Directors for the Financial
Statements
T he Directors are responsible for the preparation of the
Financial Statements and for being satisfied that they give a true
and fair view, and for such internal control as the Directors
determine is necessary to enable the preparation of Financial
Statements that are free from material misstatement, whether due to
fraud or error.
In preparing the Financial Statements, the Directors are
responsible for assessing the Company's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Company or to cease
operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial
Statements
Our objectives are to obtain reasonable assurance about whether
the Financial Statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
Auditor's Report that includes our opinion. Reasonable assurance is
a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these Financial
Statements.
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud, is detailed below, however, the primary responsibility for
the prevention and detection of fraud lies with management and
those charged with governance of the Company. We obtained an
understanding of the legal and regulatory frameworks that are
applicable to the Group and the procedures in place for ensuring
compliance. The most significant identified, was the Companies Act
2006.
-- As part of our audit planning process, we assessed the
different areas of the Financial Statements, including disclosures,
for the risk of material misstatement. This included considering
the risk of fraud, where direct enquiries were made of management
and those charged with governance concerning both, whether they had
any knowledge of actual or suspected fraud and their assessment of
the susceptibility of fraud. We considered the risk was greater in
areas that involve significant management estimate or judgement.
Based on this assessment we designed audit procedures to focus on
the key areas of estimate or judgement, as disclosed within the
Financial Statements.
-- We have read Board and Committee minutes of meetings, as well
as regulatory announcements, as part of our risk assessment process
to identify events or conditions that could indicate an incentive
or pressure to commit fraud or provide an opportunity to commit
fraud. As part of this process, we have considered whether
remuneration incentive schemes or performance targets exist for the
Directors.
-- In addition to the risk of management override of controls,
we have considered the fraud risk related to any unusual
transactions or unexpected relationships, including assessing the
risk of undisclosed related party transactions. Our procedures to
address this risk included specific testing of journal transactions
based on risk criteria, both at the year end and throughout the
year.
Owing to the inherent limitations of an audit, there is an
unavoidable risk that some material misstatements of the Financial
Statements may not be detected, even though the audit is properly
planned and performed in accordance with the ISAs (UK).
The potential effects of inherent limitations are particularly
significant in the case of misstatement, resulting from fraud
because fraud may involve sophisticated and carefully organised
schemes, designed to conceal it, including deliberate failure to
record transactions, collusion or intentional misrepresentations
being made to us.
A further description of our responsibilities for the audit of
the Financial Statements is located on the Financial Reporting
Council's website at: www.frc.org.uk/auditorsresponsibilities .
This description forms part of our auditor's report.
Other Matters which We are Required to Address
We were appointed by the Board on 24 June 2020 to audit the
Financial Statements for the year ended 31 December 2020. Our total
uninterrupted period of engagement is 5 years, covering the period
ended 31 December 2016 to 31 December 2020.
The non-audit services, prohibited by the FRC's Ethical
Standard, were not provided to the Company and we remain
independent of the Group and the Parent Company in conducting our
audit.
Our audit opinion is consistent with the additional report to
the Audit Committee.
Use of Our Report
This report is made solely to the Company's members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
Company's members those matters we are required to state to them in
an Auditor's Report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
Matthew Stallabrass
Senior Statutory Auditor
For and on behalf of
Crowe U.K. LLP
Statutory Auditor
London
29 April 2021
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2020
Note 2020 2019
US$ US$
------------------------------------------ ----- ---------- -------------
Administrative expenses 6 (528,799) (913,572)
------------------------------------------ ----- ---------- -------------
Loss from operations (528,799) (913,572)
Finance expense, net 7 (88,775) (108,178)
Impairment of exploration and evaluation
assets 10 - (2,559,000)
Loss before taxation 4 (617,574) (3,580,750)
Income tax expense 8 - -
------------------------------------------ ----- ---------- -------------
Loss for the year attributable to
equity holders of the parent company (617,574) (3,580,750)
------------------------------------------ ----- ---------- -------------
Other comprehensive loss
(Loss) on translation of parent
net assets and results from functional
currency into presentation currency (82,297) (39,602)
------------------------------------------ ----- ---------- -------------
Total comprehensive loss for the
year (699,871) (3,620,352)
------------------------------------------ ----- ---------- -------------
Loss per share - Basic and diluted,
US$ 9 (0.008) (0.044)
------------------------------------------ ----- ---------- -------------
Consolidated Statements of Financial Position
as at 31 December 2020
As reported Re-stated
Note 2020 2019 2019*
US$ US$ US$
----------------------------------- ----- ------------- ------------- -------------
Assets
Non-current assets
Intangible assets 10 - - -
Property, plant and equipment - 683 683
Restricted cash 12 125,000 125,000 125,000
----------------------------------- ----- ------------- ------------- -------------
Total non-current assets 125,000 125,683 125,683
----------------------------------- ----- ------------- ------------- -------------
Current assets
Prepayments and other receivables 13 41,699 31,203 31,203
Cash and cash equivalents 14 47,188 28,709 28,709
----------------------------------- ----- ------------- ------------- -------------
Total current assets 88,887 59,912 59,912
----------------------------------- ----- ------------- ------------- -------------
Total assets 213,887 185,595 185,595
----------------------------------- ----- ------------- ------------- -------------
Liabilities
---------------------------------------------------------------------------------------
Current liabilities
Trade and other payables* 15 737,835 835,826 690,315
Borrowings 16 1,183,018 698,798 698,798
----------------------------------- ----- ------------- ------------- -------------
Total current liabilities 1,920,853 1,534,624 1,389,113
----------------------------------- ----- ------------- ------------- -------------
Total liabilities 1,920,853 1,534,624 1,389,113
----------------------------------- ----- ------------- ------------- -------------
Capital and reserves attributable to shareholders
---------------------------------------------------------------------------------------
Share capital 17 1,105,547 1,103,457 1,103,457
Share premium 3,619,332 3,586,947 3,586,947
Share-based payments reserve 474,792 474,792 474,792
Warrants reserve 375,198 213,250 213,250
Merger reserve 31,212,041 31,212,041 31,212,041
Foreign currency translation
reserve (185,673) (103,376) (103,376)
Accumulated losses* (38,308,203) (37,836,140) (37,690,629)
Total capital and reserves (1,706,966) (1,349,029) (1,203,518)
----------------------------------- ----- ------------- ------------- -------------
Total equity and liabilities 213,887 185,595 185,595
----------------------------------- ----- ------------- ------------- -------------
The Financial Statements were approved and authorised for issue
by the Board of Directors on 29 April 2021 and were signed on its
behalf by:
John McGoldrick
Director
Consolidated Statements of Changes in Equity
Other Accumulated
Share capital Share premium reserves losses Total
US$ US$ US$ US$ US$
------------------------ -------------- -------------- ----------- ------------- ------------
Equity at 1 January
2019, as reported 1,024,036 3,563,122 31,793,304 (34,255,390) 2,125,072
------------------------ -------------- -------------- ----------- ------------- ------------
Re-stated 2018 loss* - - - 145,511 145,511
Equity at 1 January
2019, re-stated 1,024,036 3,563,122 31,793,304 (34,109,879) 2,270,583
------------------------ -------------- -------------- ----------- ------------- ------------
Loss for the year - - - (3,580,750) (3,580,750)
Other comprehensive
loss for the year - - (39,602) - (39,602)
------------------------ -------------- -------------- ----------- ------------- ------------
Total comprehensive
loss for the year - - (39,602) (3,580,750) (3,620,352)
Issue of shares 79,421 46,064 - - 125,485
Issue of warrants - (22,239) 22,239 - -
Issue of share options - - 20,766 - 20,766
------------------------ -------------- -------------- ----------- ------------- ------------
Total transactions
with shareholders 79,421 23,825 43,005 - 146,251
------------------------ -------------- -------------- ----------- ------------- ------------
Equity at 31 December
2019, re-stated 1,103,457 3,586,947 31,796,707 (37,690,629) (1,203,518)
------------------------ -------------- -------------- ----------- ------------- ------------
Loss for the year - - - (617,574) (617,574)
Other comprehensive
loss for the year - - (82,297) - (82,297)
------------------------ -------------- -------------- ----------- ------------- ------------
Total comprehensive
loss for the year - - (82,297) (617,574) (699,871)
Issue of shares 2,090 206,871 - - 208,961
Share issue costs - (12,538) - - (12,538)
Issue of warrants - (161,948) 161,948 - -
------------------------ -------------- -------------- ----------- ------------- ------------
Total transactions
with shareholders 2,090 32,385 161,948 - 196,423
------------------------ -------------- -------------- ----------- ------------- ------------
Equity at 31 December
2020 1,105,547 3,619,332 31,876,358 (38,308,203) (1,706,966)
------------------------ -------------- -------------- ----------- ------------- ------------
Other Reserves
Foreign
Share-based currency
Merger payments Warrants translation Total Other
reserve reserve reserve reserve reserves
US$ US$ US$ US$ US$
------------------------ ----------- ------------ --------- ------------- ------------
Other reserves at
1 January 2019 31,212,041 454,026 191,011 (63,774) 31,793,304
------------------------ ----------- ------------ --------- ------------- ------------
Other comprehensive
loss for the year - - - (39,602) (39,602)
------------------------ ----------- ------------ --------- ------------- ------------
Total comprehensive
loss for the year - - - (39,602) (39,602)
Issue of warrants - - 22,239 - 22,239
Issue of share options - 20,766 - - 20,766
------------------------ ----------- ------------ --------- ------------- ------------
Other reserves at
31 December 2019 31,212,041 474,792 213,250 (103,376) 31,796,707
------------------------ ----------- ------------ --------- ------------- ------------
Other comprehensive
loss for the year - - - (82,297) (82,297)
------------------------ ----------- ------------ --------- ------------- ------------
Total comprehensive
loss for the year - - - (82,297) (82,297)
Issue of warrants - - 161,948 - 161,948
Other reserves at
31 December 2020 31,212,041 474,792 375,198 (185,673) 31,876,358
------------------------ ----------- ------------ --------- ------------- ------------
Consolidated Statement of Cash Flows
Notes 2020 2019
US$ US$
-------------------------------------------------- ------ ---------- ------------
Cash flow from operating activities
Loss before taxation (617,574) (3,580,750)
Adjustments for:
Finance expenses 7 111,881 112,093
Share-based payments charge 18 - 20,766
Impairment of exploration assets 10 - 2,559,000
Unrealised foreign exchange movements 7 (23,106) (3,915)
-------------------------------------------------- ------ ---------- ------------
Operating cashflows before working capital
changes (528,799) (892,806)
-------------------------------------------------- ------ ---------- ------------
Changes in working capital:
Increase in payables 26,464 309,917
(Increase)/decrease in receivables (10,496) 27,084
-------------------------------------------------- ------ ---------- ------------
Net cash used in operating activities (512,831) (555,805)
-------------------------------------------------- ------ ---------- ------------
Financing activities
Issue of ordinary shares, net of share issue
costs 17 196,423 104,021
Proceeds from new borrowings 16 331,760 362,320
-------------------------------------------------- ------ ---------- ------------
Net cash flow from financing activities 528,183 466,341
-------------------------------------------------- ------ ---------- ------------
Net increase /(decrease) in cash and cash
equivalents in the period 15,352 (89,464)
Cash and cash equivalents at the beginning
of the period 28,709 125,621
Restricted cash held on deposits 12 125,000 125,000
-------------------------------------------------- ------ ---------- ------------
Total cash and cash equivalents at the beginning
of the period, including restricted cash 153,709 250,621
-------------------------------------------------- ------ ---------- ------------
Effect of the translation of cash balances
into presentation currency 3,127 (7,448)
Cash and cash equivalents at the end of the
period 47,188 28,709
Restricted cash held on deposits 12 125,000 125,000
-------------------------------------------------- ------ ---------- ------------
Total cash and cash equivalents at the end
of the period, including restricted cash 172,188 153,709
-------------------------------------------------- ------ ---------- ------------
Notes to the Consolidated Financial Information
1. General Information
The Company is incorporated and registered in England and Wales
as a public limited company. The Company's registered number is
09976843 and its registered office is at Kemp House, 152 City Road,
London EC1V 2NX. On 4 October 2017, the Company's shares were
admitted to the Official List (by way of Standard Listing) and to
trading on the London Stock Exchange's Main Market.
With effect from admission, the Company has been subject to the
Listing Rules and the Disclosure Guidance and Transparency Rules
(and the resulting jurisdiction of the UK Listing Authority) to the
extent such rules apply to companies with a Standard Listing
pursuant to Chapter 14 of the Listing Rules.
The principal activity of the Company is that of an investment
company, currently focused on acquiring a new business in the
environmental, social and corporate governance space (ESG).
2. Accounting Policies
The principal accounting policies adopted are set out below.
The Group Financial statements are presented in US Dollars as
historically the entirety of the Company's operations have been
located in the United States.
Basis of Preparation
The Financial Statements have been prepared in accordance with
International Financial Reporting Standards and IFRIC
interpretations as endorsed by the EU ("IFRS") and the requirements
of the Companies Act applicable to companies reporting under
IFRS.
The Financial Statements are prepared on a going concern basis
and under the historical cost convention.
The preparation of the Group Financial Statements in conformity
with IFRS requires the use of certain critical accounting
estimates. It also requires the Directors to exercise their
judgment in the process of applying the Group's accounting
policies. The areas involving a higher degree of judgment and
complexity, or areas where assumptions and estimates are
significant to the Group Financial Statements are disclosed
below.
Current assets and liabilities disclosed in the notes to the
accounts are those expected to be settled in less than one
year.
a) New standards, interpretations and amendments effective from 1 January 2020
There were no new standards or interpretations effective for the
first time for periods beginning on or after 1 January 2020 that
had a significant effect on the Curzon Group's Financial
Statements. During the period, the following new standards were
adopted:
-- Amendments to References to Conceptual Framework in IFRS
Standards - effective from 1 January 2020;
-- Definition of Material (Amendments to IAS 1 and IAS 8) -
effective from 1 January 2020;
-- Amendments to IFRS 9, IAS 39 and IFRS17: Interest Rate
Benchmark Reform;
-- Amendment to IFRS 3 Business Combinations - effective 1
January 2020.
The adoption of these standards has not had a material impact on
the financial information of the Group in reporting period and is
not expected to have a significant impact in the future. Other new
and amended standards and Interpretations issued by the IASB did
not impact the Group as they are either not relevant to the Group's
activities or require accounting, which is consistent with the
Group's current accounting policies.
b) New standards, interpretations and amendments not yet effective
At the date of authorisation of these Financial Statements, a
number of amendments to existing standards and interpretations,
which have not been applied in these Financial Statements, were in
issue but not yet effective for the year presented . The Directors
do not expect that the adoption of these standards will have a
material impact on the financial information of the Group in future
periods.
Prior Period Error Re-stated
In the reporting period, the Groups identified an error related
to the year ended 31 December 2018. A US$145,511 accrual to
previous Directors of the Company for bonus payments, that were
never earned or paid out and was waived by the previous Directors
in the year ended 31 December 2018, was still included in the
Accounts Payable balance and therefore required to be reversed from
the accounts.
The error was retrospectively corrected through opening Retained
Earnings at 1 January 2019, which affected comparative year
balances at 31 December 2019 in the following lines in the
Statement of Financial position:
-- Accounts Payable balance decreased from previously reported
US$835,826 to re-stated number of US$690,315;
-- Accumulated Loss balance changed from previously reported
loss of US$37,836,140 to re-stated loss of US$37,690,629.
Basis of Consolidation
The Company was incorporated on the 29 of January 2016. It
acquired Coos Bay Energy LLC on the 4 of October 2017. At the time
of its acquisition by the Company, Coos Bay Energy LLC consisted of
Coos Bay Energy LLC and its wholly owned US Group. It is the
Directors' opinion that the Company at the date of acquisition of
Coos Bay Energy LLC did not meet the definition of a business as
defined by IFRS 3 and therefore the acquisition was outside on the
IFRS 3 scope.
Where a party to an acquisition fails to satisfy the definition
of a business, as defined by IFRS 3, management have decided to
adopt a "merger accounting" method of consolidation as the most
relevant method to be used.
The Group consistently applies it to all similar transactions in
the following way:
-- the acquired assets and liabilities are recorded at their
existing carrying values rather than at fair value;
-- no goodwill is recorded;
-- all intra-group transactions, balances and unrealised gains
and losses on transactions are eliminated from the beginning of the
first comparative period or inception, whichever is earlier;
-- comparative periods are restated from the beginning of the
earliest comparative period presented based on the assumption that
the companies have always been together;
-- all the pre-acquisition accumulated losses of the legal
acquirer are assumed by the Group as if the companies have always
been together;
-- all the share capital and membership capital contributions of
all the companies, included into the legal acquiree sub-group less
the Company's cost of investment into these companies, are included
into the merger reserve; and
-- the Company's called up share capital is restated at the
preceding reporting date to reflect the value of the new shares
that would have been issued to acquire the merged company had the
merger taken place at the first day of the comparative period.
Where new shares have been issued during the current period that
increased net assets (other than as consideration for the merger),
these are recorded from their actual date of issue and are not
included in the comparative statement of financial position.
Going Concern
The Group Financial Statements have been prepared on a going
concern basis, which assumes that the Group will continue to be
able to meet its liabilities as they fall due for the foreseeable
future. The operations of the Company are currently being financed
by funds lent to the Company by Poseidon Enhanced Technologies Ltd.
("PET"). In exchange for a period of exclusivity in relation to a
potential reverse takeover transaction, PET has agreed to loan the
Company an initial amount of GBP65,000 in the form of a one-year
loan note carrying an annual interest rate of 10%. PET has agreed
to lend up to a total of GBP500,000 in order to support the Company
during the ongoing due diligence and potential reverse takeover
process.
The Company further continues to rely on a US$1,000,000 credit
facility provided from a company related to the largest shareholder
that provides the Group up to US$500,000 minimum funding and an
additional US$500,000 at the discretion of the lender. On 13
February 2020, the Company was notified that the entire outstanding
balance of this loan, constituting US$200,000 of principal and
US$32,000 of interest was sold to C4 Energy Ltd, a UK incorporated
private entity, and was subsequently refinanced to 30 October 2020.
This left US$800,000 of the underlying facility undrawn with the
original lender. If any amounts were to be drawn on this facility,
they would be repayable 12 months from the date of drawdown.
The Group believes that, based on the current low overhead
expenditure, the proceeds from the loans being provided by PET and
the undrawn amount of US$800,000 remaining on the US$1,000,000
credit facility will be sufficient for the Group to operate for a
period of 12 months from the date of the approval of these
Financial Statements.
The Group currently has no source of revenue and is reliant on
loans to continue to meet its overhead expenditures. The Group held
cash balances of US$47,188 as at 31 December 2020 and has
subsequently increased its borrowing capacity and current liquidity
through the agreement with PET.
The Directors note that the Group will need additional funding
to continue operations for the foreseeable future and this means
there is a material uncertainty as to the Group's ability to
continue as a going concern, however the Directors are confident
that the Group will be able to raise, as required, sufficient cash
or reduce its commitments to enable it to continue its operations,
and to continue to meet, as and when they fall due, its liabilities
for at least the next 12 months from the date of approval of the
Group Financial Statements. The Group Financial Statements have,
therefore, been prepared on the going concern basis.
Functional Currency
Functional and Presentation Currency
The individual financial information of each Group entity is
measured in the currency of the primary economic environment in
which the entity operates (its functional currency). The Company's
functional currency is UK Pound Sterling (GBP). All other
companies, belonging to the Curzon Group, have US Dollar as their
functional currency. The Group Financial Statements are presented
in US Dollars ($).
Transactions and Balances
Transactions in foreign currencies are converted into the
respective functional currencies on initial recognition, using the
exchange rates approximating those ruling at the transaction dates.
Monetary assets and liabilities at the end of the reporting period
are translated at the rates ruling as of that date.
Non-monetary assets and liabilities are translated using
exchange rates that existed when the values were determined. All
exchange differences are recognised in profit or loss.
On consolidation, the assets and liabilities of the Group's
Pound Sterling operations are translated into the Group's
presentational currency (US Dollar) at exchange rates prevailing at
the reporting date. Income and expense items are translated at the
average exchange rates for the period unless exchange rates have
fluctuated significantly during the year, in which case the
exchange rate at the date of the transaction is used. All exchange
differences arising, if any, are recognised as other comprehensive
income and are transferred to the Group's foreign currency
translation reserve.
Rates applied in these Financial Statements:
2020 2019
------------------------------------- ------- -------
Closing USD/GBP rate at 31 December 1.3672 1.3116
Average USD/GBP rate for the year 1.2760 1.2760
-------------------------------------- ------- -------
Decommissioning Costs
Where a material liability for the removal of production
facilities and site restoration at the end of the field life
exists, a provision for decommissioning is made. The amount
recognised is the present value of estimated future expenditure
determined in accordance with local conditions and requirements. An
asset of an amount equivalent to the provision is also created and
depreciated on a unit of production basis. Changes in estimates are
recognised prospectively, with corresponding adjustments to the
provision and the associated asset. At 31 December 2020 and 31
December 2019, no provisions were deemed necessary.
Impairment
Impairment of Financial Assets
All financial assets are assessed at the end of each reporting
period as to whether there is any objective evidence of impairment
as a result of one or more events having an impact on the estimated
future cash flows of the asset. For an equity instrument, a
significant or prolonged decline in the fair value below its cost
is considered to be objective evidence of impairment.
An impairment loss in respect of financial assets carried at
amortised cost is recognised in profit or loss and is measured as
the difference between the asset's carrying amount and the present
value of estimated future cash flows, discounted at the financial
asset's original effective interest rate.
If, in a subsequent period, the amount of the impairment loss
decreases and the decrease can be related objectively to an event
occurring after the impairment was recognised, the previously
recognised impairment loss is reversed through profit or loss to
the extent that the carrying amount of the financial asset at the
date the impairment is reversed does not exceed what the amortised
cost would have been had the impairment not been recognised.
Impairment of Non-Financial Assets
The carrying values of assets, other than those to which IAS 36
"Impairment of Assets" does not apply, are reviewed at the end of
each reporting period for impairment, when there is an indication
that the assets might be impaired. Impairment is measured by
comparing the carrying values of the assets with their recoverable
amounts. The recoverable amount of the assets is the higher of the
assets' fair value less costs to sell and their value-in-use, which
is measured by reference to discounted future cash flow.
An impairment loss is recognised in profit or loss
immediately.
When there is a change in the estimates used to determine the
recoverable amount, a subsequent increase in the recoverable amount
of an asset is treated as a reversal of the previous impairment
loss and is recognised to the extent of the carrying amount of the
asset that would have been determined (net of amortisation and
depreciation) had no impairment loss been recognised. The reversal
is recognised in profit or loss immediately, unless the asset is
carried at its revalued amount, in which case the reversal of the
impairment loss is treated as a revaluation increase.
Financial Instruments
Financial instruments are recognised in the statements of
financial position, when the Group has become a party to the
contractual provisions of the instruments.
Financial Assets
The Group classifies its financial assets as financial assets
carried at amortised cost, cash and cash equivalents and restricted
cash. Financial assets are initially measured at fair value and
subsequently carried at amortised cost.
Financial assets are derecognized, when the contractual rights
to receive cash flows from the financial assets have expired or
have been transferred and the Group has transferred substantially
all the risks and rewards of ownership. On de-recognition of a
financial asset in its entirety, the difference between the
carrying amount and the sum of the consideration received and any
cumulative gain or loss that had been recognised in other
comprehensive income is recognised in profit or loss.
Amortised Cost
These assets incorporate such types of financial assets, where
the objective is to hold these assets in order to collect
contractual cash flows and the contractual cash flows are solely
payments of principal and interest. They are initially recognised
at fair value plus transaction costs that are directly attributable
to their acquisition or issue and are subsequently carried at
amortised cost, using the effective interest rate method, less
provision for impairment. Impairment provisions receivables are
recognised based on the simplified approach within IFRS 9, using a
provision matrix in the determination of the lifetime expected
credit losses. During this process, the probability of the
non-payment of the receivables is assessed. This probability is
then multiplied by the amount of the expected loss arising from
default to determine the lifetime expected credit loss for the
receivables. On confirmation that the receivable will not be
collectable, the gross carrying value of the asset is written off
against the associated provision.
Impairment provisions for receivables from related parties and
loans to related parties are recognised based on a forward-looking
expected credit loss model. The methodology, used to determine the
amount of the provision, is based on whether there has been a
significant increase in credit risk since initial recognition of
the financial asset. For those where the credit risk has not
increased significantly since initial recognition of the financial
asset, twelve month expected credit losses, along with gross
interest income, are recognised. For those for which credit risk
has increased significantly but not determined to be credit
impaired, lifetime expected credit losses along with the gross
interest income are recognised. For those that are determined to be
credit impaired, lifetime expected credit losses along with
interest income on a net basis are recognised.
The Group's financial assets, measured at amortised cost,
comprise other receivables and cash and cash equivalents in the
Consolidated Statement of Financial Position.
Cash and Cash Equivalents
Cash and cash equivalents comprise cash in hand, bank balances,
bank overdrafts, deposits with financial institutions and
short-term, highly liquid investments that are readily convertible
to known amounts of cash and which are subject to an insignificant
risk of changes in value.
Restricted Cash
Restricted cash are funds held as a collateral related to
stand-by letters of credit related to the Group's oil and gas
properties. Such deposits are classified as non-current assets and
are not classified as part of cash and cash equivalents as these
deposits are not accessible by the Company for unrestricted use and
are not accessible for more than 3 months. More details on the
Group's restricted cash are given in the note 12.
Financial Liabilities
Financial liabilities are recognised when the Group becomes a
party to the contractual provisions of the financial
instrument.
Financial instruments are classified as liabilities or equity in
accordance with the substance of the contractual arrangement.
Interest, dividends, gains and losses, relating to a financial
instrument classified as a liability, are reported as an expense or
income. Distributions to holders of financial instruments
classified as equity are charged directly to equity.
All financial liabilities are recognised initially at fair value
less financial costs and subsequently measured at amortised cost,
using the effective interest method other than those categorised as
fair value through the Statement of Comprehensive Income.
A financial liability is derecognised when the obligation under
the liability is discharged, cancelled or expires. When an existing
financial liability is replaced by another from the same party on
substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or
modification is treated as a de-recognition of the original
liability and the recognition of a new liability and the difference
in the respective carrying amounts is recognised in the Income
Statement.
Financial liabilities include the following items:
-- Bank borrowings are initially recognised at fair value net of
any transaction costs directly attributable to the issue of the
instrument. Such interest-bearing liabilities are subsequently
measured at amortised cost, using the effective interest rate
method, which ensures that any interest expense over the period to
repayment is at a constant rate on the balance of the liability
carried in the consolidated statement of financial position. For
the purposes of each financial liability, interest expense includes
initial transaction costs and any premium payable on redemption as
well as any interest or coupon, payable while the liability is
outstanding;
-- Liability components of convertible loan notes are measured
as described further below;
-- Trade payables and other short-term monetary liabilities,
which are initially recognised at fair value and subsequently
carried at amortised cost, using the effective interest method.
Convertible Debt
The proceeds, received on issue of the Group's convertible debt,
are allocated into their liability and equity components. The
amount, initially attributed to the debt component, equals the
discounted cash flows, using a market rate of interest that would
be payable on a similar debt instrument that does not include an
option to convert. Subsequently, the debt component is accounted
for as a financial liability, measured at amortised cost until
extinguished on conversion or maturity of the bond. The remainder
of the proceeds is allocated to the conversion option and is
recognised as a separate equity component within shareholders'
equity, net of income tax effects.
Equity instruments
(Ordinary Shares)
Ordinary shares are classified as equity. Incremental costs,
directly attributable to the issue of new shares, are shown in
Share Premium account as a deduction, net of tax, from proceeds.
Dividends on ordinary shares are recognised as liabilities, when
approved for distribution.
(Warrants)
Warrants classified as equity are recorded at fair value as of
the date of issuance on the Company's Consolidated Statement of
Financial Position and no further adjustments to their valuation
are made. Management estimates the fair value of these liabilities,
using option pricing models and assumptions that are based on the
individual characteristics of the warrants or instruments on the
valuation date as well as assumptions for future financings,
expected volatility, expected life, yield and risk-free interest
rate.
Taxation
Income tax for each reporting period comprises current and
deferred tax.
Current tax is the expected amount of income taxes, payable in
respect of the taxable profit for the year and is measured, using
the tax rates that have been enacted or substantively enacted at
the end of the reporting period.
Deferred tax is provided in full, using the liability method, on
temporary differences, arising between the tax bases of assets and
liabilities and their carrying amounts in the Group Financial
Statements.
Deferred tax assets are recognised for all deductible temporary
differences, unused tax losses and unused tax credits to the extent
that it is probable that future taxable profits will be available
against which the deductible temporary differences, unused tax
losses and unused tax credits can be utilised. The carrying amounts
of deferred tax assets are reviewed at the end of each reporting
period and reduced to the extent that it is no longer probable that
sufficient future taxable profits will be available to allow all or
part of the deferred tax assets to be utilised.
Deferred tax liabilities are recognised for all taxable
temporary differences other than those that arise from goodwill or
excess of the Group's interest in the net fair value of the
acquired Company's identifiable assets, liabilities and contingent
liabilities over the business combination costs or from the initial
recognition of an asset or liability in a transaction, which is not
a business combination and at the time of the transaction, affects
neither accounting profit nor taxable profit.
Deferred tax assets and liabilities are measured at the tax
rates that are expected to apply in the period, when the asset is
realised or the liability is settled, based on the tax rates that
have been enacted or substantively enacted at the end of the
reporting period.
Deferred tax assets and liabilities are offset, when there is a
legally enforceable right to set off current tax assets against
current tax liabilities and when the deferred income taxes relate
to the same taxation authority.
Unrecognised deferred tax assets are reassessed at each
reporting date and are recognised to the extent that it has become
probable that future taxable profit will allow deferred tax assets
to be recovered.
Deferred tax, relating to items recognised outside profit or
loss, is recognised outside profit or loss. Deferred tax items are
recognised in correlation to the underlying transactions either in
other comprehensive income or directly in equity.
Deferred tax assets and liabilities are recognized, where the
carrying amount of an asset or liability in the Consolidated
Statement of Financial Position differs from its tax base, except
for differences, arising on the initial recognition of goodwill,
the initial recognition of an asset or liability in a transaction,
which is not a business combination and at the time of the
transaction affects neither accounting or taxable profit, and
investments in subsidiaries and joint arrangements, where the Group
is able to control the timing of the reversal of the difference and
it is probable that the difference will not reverse in the
foreseeable future.
Leases
The Group held leases to approximately 45,370 acres of
prospective coalbed methane lands in the Coos Bay Basin during the
period. These leases are outside of IFRS16 scope. The annual rental
payments, under these operating leases, were recognised as an
expense on a straight-line basis over the lease term.
Employee Benefits
Short-Term Benefits
Wages, salaries, paid annual leave and sick leave, bonuses and
non-monetary benefits are accrued in the period in which the
associated services are rendered by employees of the Group.
Post-Employment Benefits
The Group does not currently make provision for post-employment
benefits by way of pension plans or similar arrangements.
Provisions, Contingent Liabilities and Contingent Assets
Provisions are recognized, when the Group has a present or
constructive obligation as a result of past events, when it is
probable that an outflow of resources, embodying economic benefits,
will be required to settle the obligation and when a reliable
estimate of the amount can be made. Provisions are reviewed at the
end of each financial reporting period and adjusted to reflect the
current best estimate. Where the effect of the time value of money
is material, the provision is the present value of the estimated
expenditure required to settle the obligation.
A contingent liability is a possible obligation that arises from
past events and whose existence will only be confirmed by the
occurrence of one or more uncertain future events not wholly within
the control of the Group. It can also be a present obligation
arising from past events that is not recognised because it is not
probable that an outflow of economic resources will be required or
the amount of obligation cannot be measured reliably.
A contingent liability is not recognised but is disclosed in the
notes to the Financial Statements. When a change in the probability
of an outflow occurs so that the outflow is probable, it will then
be recognised as a provision.
A contingent asset is a probable asset that arises from past
events and whose existence will be confirmed only by the occurrence
or non-occurrence of one or more uncertain events not wholly within
the control of the Group. The Group does not recognise contingent
assets but discloses its existence, where inflows of economic
benefits are probable, but not virtually certain.
Share-Based Payment Arrangements
Equity-settled share-based payments to employees and others,
providing similar services, are measured at the fair value of the
equity instruments at the grant date. Details regarding the
determination of the fair value of equity-settled share-based
transactions are set out in note 18 to the Group Financial
Statements.
The fair value determined at the grant date of the
equity-settled share-based payments is expensed on a straight-line
basis over the vesting period, based on the Directors' estimate of
equity instruments that will eventually vest, with a corresponding
increase in equity. Where the conditions are non-vesting, the
expense and equity reserve, arising from share-based payment
transactions is recognised in full immediately on grant.
At the end of each reporting period, the Directors revise their
estimate of the number of equity instruments expected to vest. The
impact of the revision of the original estimates, if any, is
recognised in profit or loss such that the cumulative expense
reflects the revised estimate, with a corresponding adjustment to
other reserves.
Operating Segments
An operating segment is a component of the Group that engages in
business activities from which it may earn revenues and incur
expenses. The results of an operating segment are reviewed
regularly by the chief operating decision maker to make decisions
about resources to be allocated to the segment and assess its
performance, and for which discrete financial information is
available.
Summary of Critical Accounting Estimates and Judgments
The preparation of the Group Financial Statements, in conformity
with IFRS, requires the use of certain critical accounting
estimates. It also requires the Directors to exercise their
judgment in the process of applying the accounting policies, which
are detailed above. These judgments are continually evaluated by
the Directors and management and are based on historical experience
and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
The key estimates and underlying assumptions, concerning the
future and other key sources of estimation uncertainty at the
reporting date, that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within
the next financial period are reviewed on an ongoing basis.
Revisions to accounting estimates are recognised in the period in
which the estimate is revised if the revision affects only that
period or in the period of the revision and future periods if the
revision affects both current and future periods.
The prime areas, involving a higher degree of judgment or
complexity, where assumptions and estimates are significant to the
Financial Statements, are as follows:
Going Concern
The Group Financial Statements have been prepared on a going
concern basis as the Directors have assessed the Group's ability to
continue in operational existence for the foreseeable future. The
operations are currently being financed by third party loans. See
Going Concern section for more details.
The Group is reliant on the continuing support from its
shareholders and the expected support of future shareholders.
The Group Financial Statements do not include the adjustments
that would result if the Group were not to continue as a going
concern.
Areas of Uncertainty
On 03 February 2021, the Company announced that it had signed a
letter of intent with Poseidon Enhanced Technologies Ltd to
potentially acquire a 100% interest in their business, a developer
of a proprietary chemical recycling process for PET plastics. At
this stage, there can be no assurance that this transaction will be
completed.
As of H1 2021, the COVID-19 pandemic continued to cause
significant economic disruption across nearly all aspects of the
global economy. While the direct material effects on Curzon Energy
were considered relatively minor at the time of writing, the
potential for significant ongoing uncertainties, due to the
Pandemic, were expected to continue to exist for the foreseeable
future and any impact on the ability to consummate a reverse
takeover transaction with Poseidon Enhanced Technologies was
unclear.
3. Segmental Analysis
IFRS 8 "Operating Segments" requires operating segments to be
identified on the basis of internal reports about components of the
Group that are regularly reviewed by the chief operating decision
maker (which takes the form of the Directors) as defined in IFRS 8
"Operating Segments", in order to allocate resources to the segment
and to assess its performance.
The principal activity of the Company is that of an investment
company, currently focused on acquiring a new business in the
environmental, social and corporate governance space (ESG). At 31
December 2020 and 31 December 2019, the Directors consider there is
one reportable operating segment. Accordingly, an analysis of
segment profit or loss, segment assets, segment liabilities and
other material items has not been presented.
The Group operates in one geographic area, being the USA. All
intangible assets and operating assets and liabilities are located
in the USA, excluding cash and cash equivalents, which are
currently kept and managed from the UK head office. The management
does not consider the UK to be a separate operating segment. The
Group has not yet commenced production and therefore has no
revenue.
4. Loss for the Year Before Taxation
Loss before tax is stated after charging
/ (crediting): 2020 2019
US$ US$
------------------------------------------------------------------ --------- ----------
Impairment of exploration and evaluation
expenditure - 2,559,000
Auditor's remuneration:
* fees payable to the Company's auditor for the audit
of the consolidated and Company financial statements 31,900 32,538
* fees payable to the Company's auditor for other
services: corporate finance services - 29,048
Share-based payments - 20,766
Foreign currency translation (gain) (23,106) (3,916)
------------------------------------------------------------------- --------- ----------
5. Directors and Staff
There were no staff employed by the Group during the two years
ended 31 December 2020, except for one Director, Mr Scott Kaintz,
who was employed by the Company from 27 June 2018.
Remuneration of Key Management Personnel
The following table sets forth the compensation awarded, paid to
or earned by each Director during 2020:
Social Share-based
Directors' security Payments Total
fees costs Total cash-compensation (options) compensation
2020 US$ US$ US$ US$ US$
------------------------------- ----------- ---------- ------------------------ ------------ --------------
John McGoldrick 63,800 - 63,800 - 63,800
Scott Kaintz 148,335 20,995 169,330 - 169,330
Owen May 29,242 - 29,242 - 29,242
Total Directors' compensation 241,377 20,995 262,371 - 262,371
------------------------------- ----------- ---------- ------------------------ ------------ --------------
Social Share-based
Directors' security Payments Total
fees costs Total cash-compensation (options) compensation
2019 US$ US$ US$ US$ US$
------------------------------- ----------- ---------- ------------------------ ------------ --------------
John McGoldrick 63,799 - 63,799 20,766 84,565
Scott Kaintz 95,699 7,800 103,499 - 103,499
Owen May 31,900 - 31,900 - 31,900
------------------------------- ----------- ---------- ------------------------ ------------ --------------
Brian James Kinane - - - - -
------------------------------- ----------- ---------- ------------------------ ------------ --------------
Total Directors' compensation 191,398 7,800 199,198 20,766 219,964
------------------------------- ----------- ---------- ------------------------ ------------ --------------
The Directors' emoluments are paid from Coos Bay Energy LLC and
the Company.
John McGoldrick has, through agreement with the Company, agreed
to defer payment of his 2017, 2018, 2019 and 2020 Director's
compensation, which at 31 December 2020 totaled GBP152,500
(US$208,498).
Owen May has, through agreement with the Company, agreed to
defer payment of his 2018, 2019 and 2020 Director's compensation,
which at 31 December 2020 totaled GBP47,917 (US$65,512).
6. Administrative Expenses
2020 2019
US$ US$
------------------------------------------ ---- -------- ---------
Staff costs
Directors' salaries 241,376 212,164
Employers NI 15,891 7,800
Consultants 42,445 66,943
Professional services
Accounting, audit & taxation 74,752 87,927
Legal - 5,684
Marketing 12,235 29,647
Other - 20,757
Regulatory compliance 93,484 101,471
Standard Listing Regulatory Costs - 260,281
Travel 492 14,306
Business development - 29,345
Office and Admin
General - 6,329
IT costs 1,622 2,355
Mineral rights lease (outside of IFRS 16
scope) 11,349 32,049
Temporary storage and office rent 19,140 17,545
Insurance 16,013 18,969
------------------------------------------------ -------- ---------
Total administrative costs 528,799 913,572
------------------------------------------------ -------- ---------
7. Finance Expense (net)
2020 2019
US$ US$
------------------------------------------ --------- ---------
Foreign exchange (gain) (23,106) (3,915)
Interest expense on promissory notes and
other short-term loans 111,881 112,093
------------------------------------------- --------- ---------
Total finance expense 88,775 108,178
------------------------------------------- --------- ---------
8. Taxation
The Group has made no provision for taxation as it has not yet
generated any taxable income. A reconciliation of income tax
expense, applicable to the loss before taxation at the statutory
tax rate to the income tax expense at the effective tax rate of the
Group, is as follows:
2020 2019
US$ US$
-------------------------------------------- ---------- -------------
Loss before tax (617,574) (3,580,750)
--------------------------------------------- ---------- -------------
UK corporation tax credit at 19.00% (2019:
19.00%) (117,339) (680,342)
Effect of non-deductible expense 10,559 501,265
Differences in overseas tax rates (1,287) (3,140)
Effect of tax benefit of losses carried
forward 108,067 182,217
--------------------------------------------- ---------- -------------
Current tax (credit) - -
--------------------------------------------- ---------- -------------
As at 31 December 2020, the tax effects of temporary timing
differences, giving rise to deferred tax assets, was US$1,417,411
(2019: US$1,336,991).
A deferred tax asset in respect of these losses and temporary
differences has not been established as the Group has not yet
generated any revenues and the Directors have, therefore, assessed
the likelihood of future profits being available to offset such
deferred tax assets to be uncertain.
9. Loss Per Share
The basic loss per share is derived by dividing the loss for the
year attributable to ordinary shareholders of the Company by the
weighted average number of shares in issue.
Diluted loss per share is derived by dividing the loss for the
year attributable to ordinary shareholders of the Company by the
weighted average number of shares in issue plus the weighted
average number of ordinary shares that would be issued on
conversion of all dilutive potential ordinary shares into ordinary
shares.
The following reflects the loss and share data used in the basic
and diluted loss per share computations:
2020 2019
--------------------------------------------------- ----------- ------------
(Loss) after tax attributable to the shareholders
of the parent (US$) (617,574) (3,580,750)
Weighted average number of ordinary shares
of GBP0.01 in issue used calculation of
in basic and diluted EPS 92,632,948 81,185,175
(Loss) per share - basic and fully diluted
(US$) (0.008) (0.044)
---------------------------------------------------- ----------- ------------
At 31 December 2020, the effect of all potential ordinary shares
and contingently issuable shares, that are presented in the table
below, was anti-dilutive as it would lead to a further reduction of
loss per share, therefore, these instruments were not included in
the diluted loss per share calculation.
2020 2019
Number Number
----------------------------------------------- ----------- ----------
Share options granted to employees - fully
vested at the end of the respective period 280,854 280,854
Warrants given to shareholders as a part
of placing equity instruments - fully vested
at the end of the respective period 20,612,925 5,636,531
------------------------------------------------ ----------- ----------
Total instruments fully vested 20,893,779 5,917,385
------------------------------------------------ ----------- ----------
Total number of instruments and potentially
issuable instruments (vested and not vested)
not included into the fully diluted EPS
calculation 20,893,779 5,917,385
------------------------------------------------ ----------- ----------
10. Intangible Assets
2020 2019
Exploration and evaluation expenditure US$ US$
------------------------------------------- ------------- -------------
Cost:
At the beginning of the year 24,716,316 24,716,316
Additions - exploration costs capitalised - -
------------------------------------------- ------------- -------------
At the end of the year 24,716,316 24,716,316
-------------------------------------------- ------------- -------------
Impairment provision:
At the beginning of the year (24,716,316) (22,157,316)
Provision for the year - (2,559,000)
-------------------------------------------- ------------- -------------
At end of the year (24,716,316) (24,716,316)
-------------------------------------------- ------------- -------------
Net Book Value - -
-------------------------------------------- ------------- -------------
Environmental Matters
The Group has established procedures for a continuing evaluation
of its operations to identify potential environmental exposures and
to assure compliance with regulatory policies and procedures. The
Directors monitor these laws and regulations and periodically
assesses the propriety of its operational and accounting policies
related to environmental issues. The nature of the Group's business
requires routine day-to-day compliance with environmental laws and
regulations. The Group has incurred no material environmental
investigation, compliance or remediation costs for each of the
years ended 31 December 2020 and 31 December 2019. The Directors
are unable to predict whether the Group's future operations will be
materially affected by these laws and regulations. It is believed
that legislation and regulations, relating to environmental
protection will not materially affect the results of operations of
the Group.
11. Subsidiary Undertakings
The Group has the following subsidiary undertakings:
Country Proportion
Name of incorporation Issued capital held by Group Activity
---------------- ------------------ --------------- --------------- ------------------------
Coos Bay Energy Membership
LLC USA interests 100% Holding company
Westport Energy
Acquisitions
Inc. USA Shares 100% Holding company
Westport Energy Membership
LLC USA interests 100% Oil and gas exploration
Curzon Energy
Inc.* USA Shares 100% Holding company
Rigel Energy Membership
LLC** USA interests 100% Holding company
---------------- ------------------ --------------- --------------- ------------------------
* Incorporated on 1 May 2019 and dissolved on 26 February 2020
as related transaction did not complete.
** Incorporated on 1 May 2019 and dissolved on 27 February 2020
as related transaction did not complete.
Coos Bay Energy LLC is a limited liability corporation
incorporated in Nevada, USA whose registered office is 1370 Crowley
Avenue SE, Portland, Oregon 97302, USA.
Westport Energy Acquisition Inc. was incorporated in May 2010 in
Delaware, USA. Its registered office is located at 100 Overlook
Center, 2nd Floor, Princeton Junction, NJ 08540, USA.
Westport Energy LLC was incorporated in December 2008 in
Delaware, USA. Its registered office is located at 100 Overlook
Center, 2nd Floor, Princeton Junction, NJ 08540, USA.
12. Restricted Cash
Restricted cash includes funds held as a collateral to support
stand-by letters of credit related to the Group's oil and gas
properties. The letters of credit secure the Group's reclamation
obligations under the leases and state law. The cash can be taken
by Umpqua Bank in the event the letters of credit are drawn on by
the State of Oregon, Department of Geology & Mineral Industries
(DOGAMI). The cash is held in the form of a Certificate of
Deposit.
13. Prepayments and Other Receivables
2020 2019
US$ US$
----------------------------------------- ------- -------
VAT recoverable 3,106 4,503
Other debtors 38,593 26,700
------------------------------------------ ------- -------
Total prepayments and other receivables 41,699 31,203
------------------------------------------ ------- -------
The fair value of receivables and deposits approximates their
carrying amount as the impact of discounting is not significant.
The receivables are not impaired and are not past due.
14. Cash and Cash Equivalents
For the purpose of the Statements of Financial Position, cash
and cash equivalents comprise the following:
2020 2019
US$ US$
-------------------------- ------- -------
Cash in hand and at bank 47,188 28,709
--------------------------- ------- -------
15. Trade and Other Payables
2019
2020 re-stated
US$ US$
------------------------------------------------ -------- -----------
Trade and other payables 332,159 362,748
Accruals 388,718 327,567
------------------------------------------------- -------- -----------
Total financial liabilities, excluding
loans and borrowings, classified as financial
liabilities measured at amortised cost 720,877 690,315
------------------------------------------------- -------- -----------
Other payables - tax and social security 16,958 -
payments
------------------------------------------------ -------- -----------
Total trade and other payables 737,835 690,315
------------------------------------------------- -------- -----------
16. Borrowings
Details of the notes and borrowings originated by the Group are
disclosed in the table below:
Origination Contractual Original Annual Status at
date settlement note value interest 31 December
date in original rate 2020
currency Security
------------------- ------------- ---------------------- ------------- ---------- -------------- -------------
22 Sept Conversion/Repayment
C4 Energy Ltd 2017 at RTO date $200,000 15% unsecured Outstanding
Conversion
Bruce Edwards 1 Sep 2017 at RTO date $100,000 15% unsecured Outstanding
100% interest
HNW Investor 1 July Conversion/Repayment in Coos
Group 2019* at RTO date GBP263,265 13% Bay LLC Outstanding
Sun Seven Stars
Investment Group 13 Mar
("SSSIG") 2020 30 Aug 2021 GBP260,000 10% unsecured Outstanding
------------------- ------------- ---------------------- ------------- ---------- -------------- -------------
*Please refer to note 23 Post Balance Sheet Events for more
information
No interim payments are required under the promissory notes, as
the payment terms require the original principal amount of each
note and all accrued interest thereon, to be paid in single lump
payments on the respective contractual settlement dates.
2020 2019
US$ US$
--------------------------------------------- ---------- --------
At 1 January 698,798 213,812
Received during the year 331,760 362,320
Interest accrued during the year 109,943 110,700
Exchange rate differences 42,517 11,966
Short-term loans and borrowings 31 December 1,183,018 698,798
---------------------------------------------- ---------- --------
Reconciliation of Liabilities Arising from Financing
Activities
Cash flows
Proceeds Non-cash Non-cash
from new flow Forex flow Interest 31 Dec
31 Dec 2019 borrowings movement accrued 2020
---------------------------- ------------ ------------ ------------ --------------- ----------
HNW Investor Group 334,070 - 17,286 43,704 395,060
C4 Energy Ltd. 232,378 - - 30,000 262,378
Bruce Edwards 132,350 - - 15,000 147,350
Sun Seven Stars
Investment Group
("SSSIG") - 331,760 25,231 21,239 378,230
---------------------------- ------------ ------------ ------------ --------------- ----------
Total liabilities
from financing activities 698,798 331,760 42,517 109,943 1,183,018
---------------------------- ------------ ------------ ------------ --------------- ----------
Cash flows
Proceeds Non-cash Non-cash
from new flow Forex flow Interest 31 Dec
31 Dec 2018 borrowings movement accrued 2019
---------------------------- ------------ ------------ ------------ --------------- ---------
HNW Investor Group - 262,320 1,948 69,802 334,070
C4 Energy Ltd. 100,433 100,000 5,459 26,486 232,378
Bruce Edwards 113,379 - 4,559 14,412 132,350
Total liabilities
from financing activities 213,812 362,320 11,966 110,700 698,798
---------------------------- ------------ ------------ ------------ --------------- ---------
17. Share Capital
Authorised Share Capital
As permitted by the Companies Act 2006, the Company does not
have an authorised share capital. The Company has one class of
ordinary shares, which carry no right to fixed income. The ordinary
shares carry the right to one vote per share at General Meetings of
the Company and the rights to share in any distribution of profits
or returns of capital and to share in any residual assets available
for distribution in the event of a winding up.
Issued Equity Share Capital
Ordinary shares, Deferred shares, Share capital,
number number US$
--------------------------------- ----------------- ----------------- ---------------
At 1 January 2019 77,020,316 - 1,024,036
--------------------------------- ----------------- ----------------- ---------------
Issue of shares at GBP0.0158
per share via placement on 1
March 2019 for cash 6,012,655 - 79,421
--------------------------------- ----------------- ----------------- ---------------
At 31 December 201 9 83,032,971 - 1,103,457
--------------------------------- ----------------- ----------------- ---------------
Share subdivision on 6 May 2020
- details of subdivision are
presented in the table below 83,032,971 83,032,971 1,103,457
--------------------------------- ----------------- ----------------- ---------------
Issue of shares at GBP0.01 per
share via placement on 3 June
2020 for cash 16,606,594 - 2,090
--------------------------------- ----------------- ----------------- ---------------
At 31 December 2020 99,639,565 83,032,971 1,105,547
--------------------------------- ----------------- ----------------- ---------------
Number
Ordinary
Number Number shares
Ordinary Deferred Share of GBP0.01 Share
shares of shares Capital, before Capital,
GBP0.0001 of GBP0.0099 US$ subdivision US$
------------------------------ ----------- -------------- ---------- ------------- ----------
Issued and fully paid
Existing Ordinary Shares
of GBP0.01 each immediately
before subdivision - - - 83,032,972 1,103,457
After subdivision*:
New Ordinary shares of
GBP0.0001 each 83,032,972 - 11,035 - -
Deferred Shares of GBP0.0099
each - 83,032,972 1,092,422 - -
Total Share Capital 1,103,457 1,103,457
------------------------------ ----------- -------------- ---------- ------------- ----------
*On 6 May 2020, the Company's shareholders approved the
subdivision and re-designation of the 83,032,971 Existing Ordinary
Shares ("Existing Ordinary Shares") of GBP0.01 each in the capital
of the Company into (i) 83,032,971 New Ordinary Shares ("New
Ordinary Shares") of GBP0.0001 each and (ii) 83,032,971 Deferred
Shares ("Deferred Shares") of GBP0.0099 each in the capital of the
Company, and to amend the Company's Articles of Association
accordingly.
Each New Ordinary Share carries the same rights in all respects
under the amended Articles of Association as each Existing Ordinary
Share did under the existing Articles of Association, including the
rights in respect of voting and the entitlement to receive
dividends. Each Deferred Share carries no rights and is deemed
effectively valueless.
18. Share Based Payments
Employee Share Options
At 31 December 20 20 , the Company had outstanding options to
subscribe for ordinary shares as follows:
Option exercise price Number of Vesting date Expiry date Fair value
options of individual
granted option
GBP0.10 280,854 4 Oct 2018 4 Oct 2022 GBP0.074
Total options outstanding
at 31 December 20
20 280,854
--------------------------- ---------- ------------- ------------ ---------------
2020 2019
---------------------- ------------------------
Weighted Weighted
average average
exercise Number exercise
Number of price of price
options GBP options GBP
--------------------------------- ---------- ---------- ------------ ----------
Outstanding at the beginning of
the period 280,854 0.10 7,633,704 0.17
Granted during the period - - - -
Forfeited during the period - - (6,089,394) 0.16
Exercised during the period - - - -
Lapsed during the period - - (1,263,456) 0.18
--------------------------------- ---------- ---------- ------------ ----------
Outstanding at the end of the
period 280,854 0.10 280,854 0.10
--------------------------------- ---------- ---------- ------------ ----------
Vested and exercisable at the
end of the period 280,854 0.10 280,854 0.10
--------------------------------- ---------- ---------- ------------ ----------
During the financial year, no options (201 9 : none ) were
granted. The weighted average fair value of each option granted
during the year was GBPnil (2019: nil).
The exercise price of options outstanding on 31 December 2020
and 31 December 2019 is GBP0.1 Their weighted average remaining
contractual life was 1.45 years (2019: 2.45 years).
No options were exercised during the reporting year (2019:
nil).
Share-based remuneration expense, related to the share options
granted during the comparative period and part of the charge
relating to the options granted in 2017, is included in the
administration expenses line in the consolidated income statement
in the amount of US$ nil (2019: US$20,766).
Warrants
On 31 December 2020, the following warrants were in issue:
Warrant exercise price Number of warrants Expiry date Fair value of
granted individual warrant
------------------------- ------------------- ------------ --------------------
GBP0.0158 3,006,331 5 Mar 2021 GBP0.0056
GBP0.01 17,606,594 3 June 2022 GBP0.00731
------------------------- ------------------- ------------ --------------------
Total warrants in issue
at 31 December 2020 20,612,925
------------------------- ------------------- ------------ --------------------
2020 2019
Number of Number of
warrants warrants
Outstanding at the beginning of the period 5,636,531 3,630,200
Granted during the period 17,606,594 4,006,331
Lapsed during the period (2,630,200) (2,000,000)
Exercised during the period - -
Outstanding at the end of the period 20,612,925 5,636,531
-------------------------------------------- ------------ ------------
Vested and exercisable at the end of the
period 20,612,925 5,636,531
-------------------------------------------- ------------ ------------
The exercise price of warrants, outstanding on 31 December 20 20
, ranged between GBP0.01 and GBP0.1 58 (201 9 : ranged between
GBP0. 0 1 58 and GBP0.1). Their weighted average remaining
contractual life was 1.24 years (2019: 0.93 years).
The weighted average share price (at the date of exercise) of
warrants exercised during the year was nil (2019: nil) as no
warrants were exercised.
The following information is relevant in the determination of
the fair value of the warrants granted during the year ended 31
December 2020:
Granted on 3 June 2020
--------------------------------------------- -----------------------
Warrant pricing model used Black-Scholes
Weighted average share price at grant date,
GBP 0.013
Warrant exercise price, GBP 0.015
Weighted average contractual life, years 2
Expected volatility, % 117
Expected dividend growth rate, % 0
Risk-free interest rate (2-year bond),
% 0.006
FV of 1 warrant, GBP 0.00731
--------------------------------------------- -----------------------
Calculation of volatility involves significant judgement by the
Directors due to the absence of the historical trading data for the
Company at the date of the grant. Volatility number above was
estimated based on the range of 5-year month end volatilities of 10
similar sized listed companies operating in the Oil and Gas
sector.
The aggregate fair value, related to the share warrants granted
to shareholders acting in the capacity of shareholders during the
reporting period, has been allocated to share premium as directly
attributable share issue cost in the amount of US$161,948 (2019:
US$22,239).
19. Reserves
Share Premium
The share premium account represents the excess of consideration
received for shares issued above their nominal value net of
transaction costs.
Foreign Currency Translation Reserve
The translation reserve represents the exchange gains and losses
that have arisen from the retranslation of operations with a
functional currency, which differs to the presentation
currency.
Retained Earnings
Retained earnings represent the cumulative profit and loss net
of distributions to owners.
Warrants Reserve
The warrants reserve represents the cumulative fair value of the
warrants, granted to the investors together with placement shares,
still outstanding and not exercised.
Share-Based Payment Reserve
The share-based payment reserve represents the cumulative charge
for options granted, still outstanding and not exercised.
Merger Reserve
The merger reserve represents the cumulative share capital and
membership capital contributions of all the companies included into
the legal acquire sub-group less cost of investments into these
legal acquirees.
20. Financial Instruments - Risk Management
General Objectives, Policies and Processes
The overall objective of the Directors is to set policies that
seek to reduce risk as far as possible without unduly affecting the
Group's competitiveness and flexibility. Further details regarding
these policies are set out below.
The Directors review the Group's monthly reports through which
they assess the effectiveness of the processes put in place and the
appropriateness of the objectives and policies it sets.
Categories of Financial Assets and Liabilities
The Group's activities are exposed to a variety of market risk
(including currency risk) and liquidity risk. The Group's overall
financial risk management policy focuses on the unpredictability of
financial markets and seeks to minimise potential adverse effects
on its financial performance.
The principal financial instruments used by the Group, from
which financial instrument risk arises, are as follows:
-- other receivables;
-- cash and cash equivalents;
-- trade and other payables; and
-- borrowings.
The carrying value of financial assets and financial
liabilities, maturing within the next 12 months, approximates their
fair value due to the relatively short-term maturity of the
financial instruments.
The Group had no financial assets or liabilities carried at fair
values at the end of each reporting date.
A summary of the financial instruments held by category is
provided below:
2019,
2020 *re-stated
US$ US$
--------------------------- ---------- ------------
Financial assets
Cash and cash equivalents 47,188 28,708
Other receivables - 1,245
Restricted cash 125,000 125,000
---------------------------- ---------- ------------
Financial liabilities
Trade payables* 349,117 362,748
Accruals 388,718 327,567
Short-term borrowings 1,183,018 698,798
---------------------------- ---------- ------------
Credit Risk
The Group's exposure to credit risk, or the risk of
counterparties defaulting, arises mainly from notes and other
receivables. The Directors manage the Group's exposure to credit
risk by the application of monitoring procedures on an ongoing
basis. For other financial assets (including cash and bank
balances), the Directors minimise credit risk by dealing
exclusively with high credit rating counterparties.
Credit Risk Concentration Profile
The Group's receivables do not have significant credit risk
exposure to any single counterparty or any group of counterparties
having similar characteristics. The Directors define major credit
risk as exposure to a concentration exceeding 10% of a total class
of such asset.
The Company maintains its cash reserves in Barclays Bank UK PLC,
which maintains the following credit ratings:
Credit Agency Standard and Moody's Fitch R&I
Poor's
Long Term A/Stable A1/Stable A+/Negative A/Stable
------------- ---------- ------------ ---------
Short Term A-1 P-1 F1 N/A
------------- ---------- ------------ ---------
Unsupported Group Credit bbb+ baa3 a N/A
/Baseline Credit Assessment/Viability
Rating
------------- ---------- ------------ ---------
Exposure to Credit Risk
The Group is exposed to the credit risk of the US Specialty
Insurance Company, currently holding a US$125,000 bond on behalf of
the Company's Coos Bay Energy LLC subsidiary.
Market Risk - Interest Rate Risk
Borrowings issued at fixed rates expose the Group to fair value
interest rate risk. The Directors' policy is to maintain a majority
of the Group's borrowings in fixed rate instruments. The Directors
have analysed the Group's interest rate exposure on a dynamic
basis. This takes into consideration refinancing, renewal of
existing positions and alternative financing. Based on these
considerations, the Directors believe the Group's exposure to cash
flow and fair value interest rate risk is not significant.
Market Risk - Currency Risk
Currency risk is the risk that the value of financial
instruments will fluctuate due to changes in foreign exchange
rates. Currency risk arises when future commercial transactions and
recognised assets and liabilities are denominated in a currency
that is not the Company's (Pound Sterling, GBP) or its
subsidiaries' functional currency (US$). The Group is exposed to
foreign exchange risk, arising from currency exposures primarily
with respect to the UK Pound Sterling (GBP). The Directors monitor
the exchange rate fluctuations on a continuous basis and act
accordingly. The following sensitivity analysis shows the effects
on loss before tax of 10% increase/decrease in the exchange rates
of the US$ versus closing exchange rates of UK Pound Sterling as at
31 December 2020:
+10% -10%
US$ US$
----------------- ----------------- -----------------
Loss before tax Increase in loss Decrease in loss
by US$56,435 by US$56,435
----------------- ----------------- -----------------
2019, 2019,
2020 2020 2020 *re-stated 2019 *re-stated
Assets and liabilities by
currency of denomination,
al numbers are presented Total Total
in US$ US$ GBP US$ US$ GBP US$
---------------------------- -------- -------- ---------- ------------ -------- ------------
Financial assets
Cash and cash equivalents 299 46,889 47,188 118 28,590 28,708
Other receivables - - - - 1,245 1,245
Restricted cash 125,000 - 125,000 125,000 - 125,000
---------------------------- -------- -------- ---------- ------------ -------- ------------
Financial liabilities
Trade payables* 54,805 294,312 349,117 65,066 297,682 362,748
Accruals - 388,718 388,718 29,721 297,846 327,567
Short-term borrowings 409,728 773,290 1,183,018 364,727 334,071 698,798
---------------------------- -------- -------- ---------- ------------ -------- ------------
Liquidity Risk
The Group currently holds cash balances to provide funding for
normal trading activity. Trade and other payables and short-term
borrowings are monitored as part of normal management routine and
all amounts outstanding fall due in one year or less. Borrowings
are conducted in both US$ and UK Pound Sterling and as such the
Company monitors fluctuations that may impact both present and
future liquidity levels.
Capital Management
The Group defines capital as the total equity of the Group. The
Directors' objectives, when managing capital, are to safeguard its
ability to continue as a going concern in order to provide returns
for shareholders and benefits for other stakeholders and to
maintain an optimal capital structure to reduce the cost of
capital.
To meet these objectives, the Directors review the budgets and
projections on a regular basis to ensure there is sufficient
capital to meet the needs of the Group through to profitability and
positive cash flow.
The capital structure of the Group consists of shareholders'
equity as set out in the consolidated statement of changes in
equity. All working capital requirements are financed from existing
cash resources and borrowings.
Whilst the Group does not currently have distributable profits,
it is part of the capital strategy to provide returns for
shareholders and benefits for members in the future.
Capital for further development of the Group's activities will,
where possible, be achieved by share issues or other finance as
appropriate.
In order to maintain or adjust the capital structure, the
Directors may return capital to shareholders, issue new shares or
sell assets to reduce debt. It also ensures that distributions to
shareholders do not exceed working capital requirements.
Fair Value Hierarchy
All the financial assets and financial liabilities, recognised
in the Group Financial Statements, are shown at the carrying value,
which also approximates the fair values of those financial
instruments. Therefore, no separate disclosure for fair value
hierarchy is required.
21. Leases
All the Group's leases are short-term leases, which are
month-to-month obligations (i.e., US administrative storage
operating lease).
22. Related Party Transactions
Balances and transactions between the Company and its
subsidiaries, Coos Bay Energy LLC, Westport Energy Acquisition Inc.
and Westport Energy LLC are eliminated on consolidation and are not
disclosed in this note. Balances and transactions between the Group
and other related parties are disclosed below.
Promissory Notes
During the year ended 31 December 2019, US$100,000 of promissory
notes were issued to YA Global Investments LP, a company that is
also the majority shareholder of the business, see note 16 for
further information.
On 13 February 2020, the Company announced that it had been
informed by YA Global Investments LP of the sale of its outstanding
debt due to YA Global to C4 Energy Ltd, a UK incorporated private
Company. The balance of the loan agreement at that time was
US$200,000, with approximately US$32,000 of accrued interest.
Remuneration of Directors
The remuneration of the senior Executive Management Committee
members, who are the key management personnel of the Group, is set
out in aggregate for each of the categories specified in IAS 24
"Related Party Disclosures" in note 5 .
23. Events After the Reporting Period
Termination of Discussions - Execution of LOI
On 03 February 2021, the Company announced that it has informed
Sun Seven Stars Investment Group ("SSSIG") of the formal
termination of the Letter of Intent, first announced on 18 March
2020. As the period of exclusivity with SSSIG had already expired,
no further obligations remain among the parties.
The Company further announced the execution of a Letter of
Intent ("LOI") with Poseidon Enhanced Technologies Limited ("PET").
The Company will now enter an initial period of exclusivity with
PET during which each party will conduct due diligence on the
other. The parties have agreed that during this period they will
work towards the execution and delivery of a definitive purchase
agreement, contemplating a reverse takeover of Curzon by PET
("RTO"), which will be conditional upon receipt of the required
regulatory approvals from the FCA and its primary market functions,
among other matters. For providing PET with an initial period of
exclusivity, lasting through to 28 February 2021, PET will lend the
Company an initial amount of GBP65,000 in the form of a one-year
loan Note (the "Note"), carrying an annual interest rate of 10% per
annum, and convertible at the price of any subsequent share issue
alongside the contemplated RTO transaction. Under the terms of the
Note, a total of GBP500,000 is authorised to be made available to
the Company through mutually agreed drawdowns. Any additional
drawdowns, including in relation to potential ongoing exclusivity,
will be deducted from this total authorised amount as they are
made. After 1 March 2021, further loan funds may be made available
by PET to the Company if the envisaged transaction continues to
progress, or in order to extend the initial period of exclusivity
beyond 28 February 2021.
Exclusivity Extension
On 1 March 2021, the Company announced that under the terms of
the LOI initially announced on 3 February 2021, Poseidon Enhanced
Technologies has informed the Company of an extension of the
existing exclusivity period through 1 April 2021.
On 29 March 2021, the Company announced that Poseidon Enhanced
Technologies has informed the Company of an extension of the
existing period through 1 May 2021.
On 28 April 2021, the Company announced that Poseidon Enhanced
Technologies had informed the Company of an extension of the
existing exclusivity period through 1 June 2021.
Loan Extension
On 25 March 2021, the Company announced that it had extended its
outstanding loan with Sun Seven Stars Investment Group to 30 August
2021.
Company Statement of Financial Position
as at 31 December 2020
Note 2020 2019
GBP GBP
--------------------------------------------------- ----- ------------ ------------
Assets
Non-current assets
Property, plant and equipment - 521
Investments in subsidiaries 28 - -
Amounts receivable from subsidiary undertakings 29 - -
--------------------------------------------------- ----- ------------ ------------
Total non-current assets - 521
--------------------------------------------------- ----- ------------ ------------
Current assets
Trade and other receivables 30 3 0 ,500 23,790
Cash and cash equivalents 31 34,514 21,888
--------------------------------------------------- ----- ------------ ------------
Total current assets 65,014 45,678
--------------------------------------------------- ----- ------------ ------------
Total assets 65,014 46,199
--------------------------------------------------- ----- ------------ ------------
Liabilities
Current liabilities
Trade and other payables 32 499,583 454,048
Borrowings 33 865,285 532,783
--------------------------------------------------- ----- ------------ ------------
Total liabilities 1,364,868 986,831
--------------------------------------------------- ----- ------------ ------------
Capital and reserves attributable to shareholders
Share capital 34 831,990 830,330
Share premium 34 2,718,932 2,693,194
Share-based payments reserve 355,269 355,269
Warrants reserve 289,481 160,777
Merger relief reserve 2,800,000 2,800,000
Accumulated losses (8,295,526) (7,780,202)
Total capital and reserves (1,299,854) (940,632)
--------------------------------------------------- ----- ------------ ------------
Total equity and liabilities 65,014 46,199
--------------------------------------------------- ----- ------------ ------------
Company Statement of Comprehensive Income
As permitted by Section 408 Companies Act 2006, the Company has
not presented its own income statement or statement of
comprehensive income. The Company's loss for the financial year was
GBP515,324 (2019: GBP5,191,316). The Company's total comprehensive
loss for the financial year was GBP515,324 (2019:
GBP5,191,316).
The Financial Statements were approved by the Board of Directors
and authorised for issue on 29 April 2021 and are signed on its
behalf by:
John McGoldrick
Director
The notes to the Company Statement of Financial Position form
part of these Financial Statements.
Company Statement of Changes in Equity
Share-based Merger
Share Share payments Warrants relief Accumulated
capital Premium reserve reserve reserve loss Total
GBP GBP GBP GBP GBP GBP GBP
------------------------ --------- ---------- ------------ --------- ---------- ------------ ------------
Equity at 1 January
2019 770,203 2,675,156 338,995 143,942 2,800,000 (2,588,886) 4,139,410
Loss for the year
2019 - - - - - (5,191,316) (5,191,316)
Total comprehensive
loss for the year
2019 - - - - - (5,191,316) (5,191,316)
Issue of shares 60,127 34,873 - - - - 95,000
Issue of warrants - (16,835) - 16,835 - - -
Issue of share options - - 16,274 - - - 16,274
------------------------ --------- ---------- ------------ --------- ---------- ------------ ------------
Total transactions
with shareholders 60,127 18,038 16,274 16,835 - - 111,274
------------------------ --------- ---------- ------------ --------- ---------- ------------ ------------
Equity at 31 December
2019 830,330 2,693,194 355,269 160,777 2,800,000 (7,780,202) (940,632)
------------------------ --------- ---------- ------------ --------- ---------- ------------ ------------
Loss for the year
2020 - - - - - (515,324) (515,324)
Other comprehensive
loss for the year - - - - - - -
----------------------- -------- ---------- -------- -------- ---------- ------------ ------------
Total comprehensive
loss for the year
2020 - - - - - (515,324) (515,324)
Issue of shares 1,661 164,405 - - - - 166,066
Transaction costs - (9,964) - - - - (9,964)
Issue of warrants - (128,704) - 128,704 - - -
----------------------- -------- ---------- -------- -------- ---------- ------------ ------------
Total transactions
with shareholders 1,661 25,737 - 128,704 - - 156,102
----------------------- -------- ---------- -------- -------- ---------- ------------ ------------
Equity at 31 December
2020 831,990 2,718,932 355,269 289,481 2,800,000 (8,295,526) (1,299,854)
----------------------- -------- ---------- -------- -------- ---------- ------------ ------------
Company Statement of Cash Flows
for the Year Ended 31 December 2020
Notes 2020 2019
GBP GBP
---------------------------------------------- ------- ---------- ------------
Cash flow from operating activities
Loss before taxation (515,324) (5,191,316)
Adjustments for:
Finance expense 87,681 87,849
Finance income (39,368) (39,368)
Share-based payments charge - 16,274
Impairment of loans and receivables 94,627 1,713,317
Impairment of investments in subsidiaries - 2,800,275
Income from forgiven creditors (15,816) -
Unrealised foreign exchange movements (18,110) (3,069)
------------------------------------------------------- ---------- ------------
Operating cashflows before working capital
changes (406,310) (616,038)
------------------------------------------------------- ---------- ------------
Changes in working capital:
Increase in payables 64,802 233,718
(Increase)/decrease in receivables (6,709) 20,649
------------------------------------------------------- ---------- ------------
Net cash used in operating activities (348,217) (361,671)
------------------------------------------------------- ---------- ------------
Financing activities
Issue of ordinary shares, net of share issue
costs 156,102 78,750
Proceeds from new borrowings 260,000 277,540
Advances granted to subsidiaries (55,259) (71,722)
------------------------------------------------------- ---------- ------------
Net cash flow from financing activities 360,843 284,568
------------------------------------------------------- ---------- ------------
Net increase/(decrease) in cash and cash
equivalents in the period 12,626 (77,103)
------------------------------------------------------- ---------- ------------
Cash and cash equivalents at the beginning
of the period 21,888 98,991
------------------------------------------------------- ---------- ------------
Cash and cash equivalents at the end of the
period 34,514 21,888
------------------------------------------------------- ---------- ------------
Notes to the Company Financial Statements
24. Significant Accounting Policies
The separate Financial Statements of the Company are presented
as required by the Companies Act 2016 ("the Act"). As permitted by
the Act, the separate Financial Statements have been prepared in
accordance with International Financial Reporting Standards.
The Financial Statements have been prepared on the historical
cost basis. The principal accounting policies adopted are the same
as those set out in note 2 to the Consolidated Financial Statements
except as noted below.
Investments in Subsidiaries
Investments in subsidiaries are carried at cost and are
regularly reviewed for impairment if there are any indications that
the carrying value may not be recoverable.
Receivables from Subsidiaries
Impairment provisions for receivables from related parties and
loans to related parties are recognized, based on a forward-looking
expected credit loss model. The methodology, used to determine the
amount of the provision, is based on whether there has been a
significant increase in credit risk since initial recognition of
the financial asset. For those where the credit risk has not
increased significantly since initial recognition of the financial
asset, twelve month expected credit losses along with gross
interest income are recognised. For those for which credit risk has
increased significantly but not determined to be credit impaired,
lifetime expected credit losses along with the gross interest
income are recognised. For those that are determined to be credit
impaired, lifetime expected credit losses along with interest
income on a net basis are recognised.
Critical Accounting Judgments and Key Sources of Estimation
Uncertainty
The Company ' s Financial Statements, and in particular its
investments in and receivables from subsidiaries, are affected by
the critical accounting judgments and key sources of estimation
uncertainty in respect of going concern judgements which are more
fully described in note 2 to the Consolidated Financial
Statements.
25. Auditor's Remuneration
The auditor ' s remuneration for audit and other services is
disclosed in note 4 to the Consolidated Financial Statements.
26. Directors and Staff
Scott Kaintz, Executive Director of the Company, has been the
only employee of the Company in the reporting year after he was
employed on 5 November 2018 and to date.
Key management remuneration is disclosed in note 5 to the
Consolidated Financial Statements.
27. Administrative Expenses
2020 2019
GBP GBP
--------------------------------------- -------- --------
Staff costs 218,954 166,113
Share-based payments - 16,274
Standard Listing Prospectus Costs - 203,985
Standard Listing Regulatory Costs 73,263 79,524
Professional and consultancy fees 75,672 103,121
Other general administrative expenses 38,421 63,296
---------------------------------------- -------- --------
Total 406,310 632,312
---------------------------------------- -------- --------
28. Investments
Investment in subsidiaries
2020 2019
GBP GBP
----------------------------------- ------ ------------
Costs at beginning of the year - 2,800,275
Impairment - (2,800,275)
------------------------------------ ----- ------------
Total investments in subsidiaries - -
------------------------------------ ----- ------------
29. Receivables from Subsidiaries and Related Party Transactions
2020 2019
GBP GBP
---------------------------- ----- -----
Loans to subsidiaries - -
---------------------------- ----- -----
Total loans to subsidiaries - -
---------------------------- ----- -----
During the year ended 31 December 2020, the Company recognised
expected credit losses in relation to the intercompany loans in the
amount of GBP94,627 (2019: GBP1,713,317). This relates to the
write-off of the Company's Coos Bay coal bed methane project in
full, due primarily to the lack of capital available to advance the
project in declining US oil and gas markets.
During the year ended 31 December 2020, the maximum amount owed
by the Group to the Company was GBP94,627 (2019: GBP1,713,317). The
related party loans are unsecured and are repayable at the time of
completion of a reverse takeover. Interest is receivable at a rate
of 9%. At 31 December 2020, GBP39,368 (2019: GBP39,368) was accrued
and included in the above balance.
The remuneration of the senior Executive Management Committee
members, who are the key management personnel of the Group, is set
out in aggregate for each of the categories specified in IAS 24
"Related Party Disclosures" in note 5 .
30. Prepayments and Other Receivables
2020 2019
GBP GBP
----------------------------------------- ------- -------
VAT recoverable 2,272 3,433
Prepayments 28,227 19,408
Other debtors - 949
------------------------------------------ ------- -------
Total prepayments and other receivables 30,499 23,790
------------------------------------------ ------- -------
The fair value of receivables and deposits approximates their
carrying amount, as the impact of discounting is not significant.
The receivables are not impaired and are not past due.
31. Cash and Cash Equivalents
For the purpose of the statements of cash flows, cash and cash
equivalents comprise the following:
2020 2019
GBP GBP
-------------------------- ------- -------
Cash in hand and at bank 34,514 21,888
--------------------------- ------- -------
32. Current Liabilities
Trade and Other Payables
2020 2019
GBP GBP
-------------------------------- -------- --------
Trade and other payables 215,266 226,962
Accruals 284,317 227,086
--------------------------------- -------- --------
Total trade and other payables 499,583 454,048
--------------------------------- -------- --------
33. Short-Term Borrowings
At 31 December 2020, the Company had an outstanding promissory
notes and loans of GBP865,285 (2019: GBP532,783), please refer to
note 16 .
Cash flows
Proceeds Non-cash Non-cash
from new flow Forex flow Interest 31 Dec
1 Jan 2020, borrowings, movement, accrued, 2020,
GBP GBP GBP GBP GBP
-------------------- ------------ ------------- ------------ --------------- --------
HNW Investor Group 254,705 - - 34,251 288,956
C4 Energy Ltd 177,171 - (8,773) 23,511 191,909
Bruce Edwards 100,907 - (4,888) 11,756 107,775
Sun Seven Stars
Investment Group
("SSSIG") - 260,000 - 16,645 276,645
-------------------- ------------ ------------- ------------ --------------- --------
Total liabilities
from financing
activities 532,783 260,000 (13,661) 86,163 865,285
-------------------- ------------ ------------- ------------ --------------- --------
Cash flows
Proceeds Non-cash Non-cash
from new flow Forex flow Interest 31 Dec
1 Jan 2019, borrowings, movement, accrued, 2019,
GBP GBP GBP GBP GBP
-------------------- ------------ ------------- ------------ --------------- --------
HNW Investor Group - 200,000 - 54,705 254,705
C4 Energy Ltd 79,143 77,540 - 20,488 177,171
Bruce Edwards 89,343 - - 11,564 100,907
-------------------- ------------ ------------- ------------ --------------- --------
Total liabilities
from financing
activities 168,486 277,540 - 86,757 532,783
-------------------- ------------ ------------- ------------ --------------- --------
34. Share Capital
The movements in the share capital account are disclosed in note
17 to the Financial Statements.
35. Financial Instruments - Risk Management
The Company ' s strategy and financial risk management
objectives are described in note 20.
Principal Financial Instruments
The principal financial instruments used by the Company from
which risk arises are as follows:
2020 2019
GBP GBP
----------------------------- -------- --------
Financial assets
Cash and cash equivalents 34,514 21,888
Other receivables - 949
Loans due from subsidiaries - -
----------------------------- -------- --------
Financial liabilities
Trade payables 215,266 226,961
Accruals 284,317 227,086
Short-term borrowings 865,285 532,783
------------------------------ -------- --------
Credit Risk
Credit risk refers to the risk that a counterparty will default
on its contractual obligations, resulting in financial loss to the
Company.
In addition to the risks described in note 20, which affect the
Group, the Company is also subject to credit risk on the balances
receivable from subsidiaries, see note 29 . In the year ended 31
December 2020, credit losses were recognised in full in relation to
all the balances receivable from subsidiaries.
Market Risk - Currency Risk
The Company is exposed to foreign exchange risk, arising from
currency exposures primarily with respect to the US Dollar (US$).
The Directors monitor the exchange rate fluctuations on a
continuous basis and act accordingly.
Assets and liabilities by currency 2020 2019
of denomination, al numbers are 2020 2020 Total 2019 2019 Total
presented in GBP US$ GBP GBP US$ GBP GBP
------------------------------------ -------- -------- -------- -------- -------- --------
Financial assets
Cash and cash equivalents 219 34,295 34,514 90 21,798 21,888
Other receivables - - - - 949 949
Financial liabilities
Trade payables - 215,266 215,266 - 226,961 226,961
Accruals - 284,317 284,317 - 227,086 227,086
Short-term borrowings 299,684 565,601 865,285 278,078 254,705 532,783
------------------------------------ -------- -------- -------- -------- -------- --------
36. Events After the Reporting Period
Events after the reporting period are more fully described in
note 23 .
37. Controlling Party
At 31 December 2020, the Company did not have an ultimate
controlling party.
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