TIDMBPC
RNS Number : 0896C
Bahamas Petroleum Company PLC
27 September 2018
27 September 2018
Bahamas Petroleum Company plc
("BPC" or the "Company")
Interim Results for the six months ended 30 June 2018
Bahamas Petroleum Company plc, the oil and gas exploration
company with significant prospective resources in licences in The
Commonwealth of The Bahamas is pleased to announce its interim
results for the six months ended 30 June 2018.
Operating Highlights:
-- Lodged application for Environmental Authorisation with the
Government of The Bahamas, representing the necessary first step in
commencing offshore field activity.
-- Received non-refundable cash payments totalling $1 million in
respect of a 4-month period of exclusivity (May - August 2018) with
a major international oil company.
-- Raised approximately $1.6 million through a share placement
and the exercise of warrants, further bolstering the Company's cash
position.
-- Appointed Macquarie Capital Markets Canada Ltd as an advisor
to assist the Company with various well funding initiatives,
providing a full suite of global corporate and asset-based
financing solutions.
Financial Highlights:
-- Cash at end of the period of approximately $3.1 million, an
increase on both the previous 6-month period (approximately $1.8
million H2 2017) and the prior year comparative period
(approximately $1.4 million H1 2017) owing to capital raisings and
exclusivity fee payments received.
-- Operating loss and total loss reduced approximately 65% and
95% respectively on comparative 6-month period, impacted by
write-offs agreed by CEO to remuneration package.
-- Significant cash saving initiatives continued during the
period, including the Board agreeing to increase fee deferrals from
50% to 90%; employee benefit expense reduced 120% on comparative
6-month period largely as a result of CEO remuneration changes.
Post Period:
-- Agreed substantial changes to the CEO's remuneration
resulting in a reduction in salary, termination of ongoing deferral
of salary into conditional share entitlements and the writing off
of all conditional cash and pension entitlements accrued to 1 July
2018.
-- Recommenced engagement with a variety of new and existing
parties as potential well funding partners.
Simon Potter, Chief Executive Officer of Bahamas Petroleum
Company, said:
"The first six-months of 2018 have been a busy period for the
Company. While the exclusivity agreement entered into with the
major oil company was not extended beyond 31 August 2018, the
Company is encouraged by their interest and willingness to pay a
substantial amount to enter exclusive discussions. The Company
views this as validation of the technical merits and strong
potential of our high impact project.
"The Board remains entirely focussed on seeing an initial
exploration well completed. With the support of our advisers at
Macquarie, the sustained recovery in the global oil price providing
further confidence to industry operators and investors alike, and
the recent bolstering of the Company cash position, we are working
hard to secure the investment needed to move this exciting project
forward.
"We would like to thank all our investors and staff for their
continued support and perseverance and look forward to reporting on
further developments to you in the near term."
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014.
Ends
For further information, please contact:
Bahamas Petroleum Company plc Tel: +44 (0) 1624
Simon Potter, Chief Executive Officer 647 883
Strand Hanson Limited - Nomad Tel: +44 (0) 20
Rory Murphy / James Spinney / Frederick 7409 3494
Twist
Shore Capital Stockbrokers Limited - Broker Tel: +44 (0) 207
Jerry Keen / Toby Gibbs / James Thomas 408 4090
CAMARCO Tel: +44 (0) 20
Billy Clegg / Gordon Poole / James Crothers 3757 4983
Notes to editors:
Bahamas Petroleum Company is an oil and gas exploration company
with 100% owned offshore licences exclusively focused on The
Commonwealth of The Bahamas. The Company has significant
prospective resources, which have been de-risked through both
extensive 2D and 3D seismic. The Company is intent on delivering
safe and environmentally responsible exploration.
www.bpcplc.com
Chairman and Chief Executive Officer's Review
The 6 months to 30 June 2018 has been a period of progress for
the Company, during which several key operational and financial
developments have moved forward.
During the period, the Company filed its application for
Environmental Authorisation with the Government of The Bahamas, as
required by the new Petroleum Regulations introduced in The Bahamas
in 2016, applicable to the Company's southern licences. This
application represents the required, and necessary, first step for
commencing field activities for an exploration well.
In May 2018, the Company entered into a Confidentiality and
Exclusivity Agreement ("Agreement") with a major international oil
company. The Agreement created a period, during which, the Company
agreed to engage solely with that oil major, rather than
maintaining negotiations with the broad range of parties it had
been working with hitherto. In exchange for this, the Company
received cash payments totalling $1 million. The Agreement ended
effective 31 August 2018 and the Company has since resumed
discussions with various parties, including a number of new
potential partners. The Company considers the willingness of a
major international oil company to enter into exclusive
negotiations, and to pay a substantial amount for that exclusivity,
to be validation of the technical merits and strong potential of
the Company's project.
Also in May 2018, the Company raised additional working capital
through a successful placement with its brokers, Shore Capital,
providing approximately $1.3 million in additional funds. When
combined with the $1 million exclusivity payments received and the
subscription funds of approximately $300,000 received following the
exercise of warrants held by Shore Capital (in May and July of 2018
respectively) additional funding of approximately $2.6 million has
been secured for the Company. These funding inflows mean the
Company has adequate working capital in the medium term to continue
to pursue a farm-in or similar funding arrangement for an initial
exploration well on its southern licences.
Finally, during the reporting period, the Company appointed
Macquarie Capital Markets Canada Ltd ("Macquarie") to act as
financial advisors to the Company. With an extensive global network
in the oil and gas space, as well as the broader investment
community, Macquarie is assisting the Company with respect to a
full suite of solutions for the funding required to execute an
initial exploration well, both at the asset and corporate
level.
The overall operating environment for the Company has continued
to strengthen during the period. Globally, oil prices have risen
considerably and, in The Bahamas, the Government has continued to
indicate support for the development of a domestic hydrocarbon
industry. For example, in its most recent budget statement, the
Government endorsed a diversification of the Bahamian economy and
an expansion of its revenue base to create more buoyant and
resilient growth; with the Finance Minister referencing a "Blue
Economy" policy, seeking to maximise the economic potential of The
Bahamas' oceans, including specifically "oil and gas production".
Also, during the period the Government sanctioned a large new
refinery project on the island of Grand Bahama, and a new Liquified
Natural Gas facility on the island of New Providence.
In terms of financial performance for the period, overall, the
Company reported a reduction in operating loss and total loss of
approximately 65% and 95% respectively against the comparative
6-month period. These results were, however, significantly impacted
by changes effected to the Chief Executive Officer ("CEO") contract
after the reporting date. As announced on 6 August 2018, the CEO
agreed to terminate the ongoing deferral of cash salary into
conditional share entitlements, agreed to write off all conditional
cash and pension entitlements accrued to the effective date of 1
July 2018, and agreed to a substantial reduction in the overall
level of salary. The write-off of all of these conditional cash and
pension entitlements as at 30 June 2018, which totalled $1,012,500
and $225,000 respectively, has resulted in the release of
corresponding amounts accrued in the financial statements to date
in respect of these "contingent liabilities". As a consequence, the
employee benefit expense for the period includes a credit of over
$1.2 million, resulting in a negative total cost for the period and
an overall reduction on the comparative 6-month period of 120%.
Apart from quantifying an immediate financial benefit to the
Company, these write-backs also demonstrate the continued support
of the CEO in developing the project to the next phase, whilst
maintaining alignment of the Company's executive with the interests
of shareholders. In a similar vein, during the period the Board
agreed to increase its fee deferrals to 90% from 50%, effective 1
January 2018, resulting in further ongoing cash savings to the
Company.
Other expenses for the period have increased by approximately
20% on the comparative 6-month period, driven largely by the
increase in professional fees associated with the expansion of
partnership/investment related activity and the appointment of
advisors, as noted above. It is worth highlighting, however, that
these increased costs directly relate to the strategic objectives
of the Company (i.e.: achieving a farm-out or other financing for
an initial exploration well) and have been incurred against the
backdrop of raising $2.6 million from exclusivity payments and
equity issuances, as noted above.
The Group closed the reporting period with approximately $3.1
million in freely available cash and received a further $500,000 in
exclusivity payments following the reporting date. Following expiry
and release of the performance bond of $500,000 in the period,
restricted cash balances are now immaterial.
Going forward, the Board remains entirely focussed on seeing an
initial exploration well completed. With the support of our
advisers at Macquarie, the sustained recovery in the global oil
price providing further confidence to industry operators and
investors alike and the recent bolstering of the Company cash
position, we are working hard to secure the investment needed to
move this exciting project forward.
We would like to thank all our investors and staff for their
continued support and perseverance and look forward to reporting on
further developments to you in the near term.
Yours sincerely,
Bill Schrader Simon Potter
Chairman Chief Executive Officer
27 September 2018
Consolidated statement of comprehensive income
for the six months ended 30 June 2018
Note Six months Six months Year ended
ended 30 ended 30 31 December
June June
2018 2017 2017
(Unaudited) (Unaudited) (Audited)
$ $ $
Continuing operations:
Employee benefit expense 3 209,974 (998,850) (1,993,171)
Depreciation expense (13,984) (10,809) (21,508)
Other expenses (790,818) (651,237) (1,238,397)
Operating loss (594,828) (1,660,896) (3,253,076)
Other income 2 500,000 24,253 36,253
Finance income 5,308 429 3,507
Total comprehensive
income for the period,
net of tax (89,520) (1,636,214) (3,213,316)
--------- ------------ ------------
Basic and diluted loss
per share (cents per
share) (0.0001) (0.13) (0.24)
--------- ------- -------
Consolidated statement of changes in equity
for the six months ended 30 June 2018
Share
Share Reverse based
Share premium Merger acquisition payment Retained Total
capital reserve reserve reserve reserve earnings equity
$ $ $ $ $ $ $
At 1 January
2018 44,481 81,398,084 77,130,684 (53,846,526) 3,381,645 (57,752,641) 50,355,727
Comprehensive
income
Loss for
the period - - - - - (89,520) (89,520)
--------- ----------- ----------- ------------- ---------- ------------- -----------
Total comprehensive
income for
the period - - - - - (89,520) (89,520)
--------- ----------- ----------- ------------- ---------- ------------- -----------
Transactions
with owners
Issue of
ordinary
shares 1,587 1,583,241 - - - - 1,584,828
Share options
- value of
services - - - - 366,270 - 366,270
--------- ----------- ----------- ------------- ---------- ------------- -----------
Total transactions
with owners 1,587 1,583,241 - - 366,270 - 1,951,098
Balance at
30 June 2018 46,068 82,981,325 77,130,684 (53,846,526) 3,747,915 (57,842,161) 52,217,305
--------- ----------- ----------- ------------- ---------- ------------- -----------
Consolidated statement of changes in equity
for the six months ended 30 June 2017
Share
Share Reverse based
Share premium Merger acquisition payment Retained Total
capital reserve reserve reserve reserve earnings equity
$ $ $ $ $ $ $
At 1 January
2017 37,253 78,185,102 77,130,684 (53,846,526) 2,694,171 (54,539,325) 49,661,359
Comprehensive
income
Loss for
the period - - - - - (1,636,214) (1,636,214)
--------- ----------- ----------- ------------- ---------- ------------- ------------
Total comprehensive
income for
the period - - - - - (1,636,214) (1,636,214)
--------- ----------- ----------- ------------- ---------- ------------- ------------
Transactions
with owners
Issue of
ordinary
shares 2,791 1,196,206 - - - - 1,198,997
Share options
- value of
services - - - - 330,734 - 330,734
--------- ----------- ----------- ------------- ---------- ------------- ------------
Total transactions
with owners 2,791 1,196,206 - - 330,734 - 1,529,731
Balance at
30 June 2017 40,044 79,381,308 77,130,684 (53,846,526) 3,024,905 (56,175,539) 49,554,876
--------- ----------- ----------- ------------- ---------- ------------- ------------
Consolidated statement of changes in equity
for the year ended 31 December 2017
Share
Share Reverse based
Share premium Merger acquisition payment Retained Total
capital reserve reserve reserve reserve earnings equity
$ $ $ $ $ $ $
At 1 January
2017 37,253 78,185,102 77,130,684 (53,846,526) 2,694,171 (54,539,325) 49,661,359
Comprehensive
income
Loss for the
year - - - - - (3,213,316) (3,213,316)
--------- ----------- ----------- ------------- ------------ --------------- -------------
Total
comprehensive
income for
the year - - - - - (3,213,316) (3,213,316)
Transactions
with owners
Issue of
ordinary
shares 7,228 3,212,982 - - - - 3,220,210
Share options
- value of
services - - - - 687,474 - 687,474
Total
transactions
with owners 7,228 3,212,982 - - 687,474 - 3,907,684
--------- ----------- ----------- ------------- ------------ --------------- -------------
Balance at
31 December
2017 44,481 81,398,084 77,130,684 (53,846,526) 3,381,645 (57,752,641) 50,355,727
--------- ----------- ----------- ------------- ------------ --------------- -------------
Consolidated balance sheet
at 30 June 2018
30 June 30 June 31 December
2018 2017 2017
(Unaudited) (Unaudited) (Audited)
Assets Note $ $ $
Non-current assets
Intangible exploration
and evaluation assets 1 48,454,371 48,139,702 48,318,079
Property, plant and
equipment 57,391 33,736 41,278
Restricted cash - - -
48,511,762 48,173,438 48,359,357
Current assets
Other Receivables 800,378 707,385 729,292
Cash and cash equivalents 3,078,885 1,390,390 1,838,527
Restricted cash 26,382 526,008 527,063
3,905,645 2,623,783 3,094,882
------------- ------------- ------------
Total assets 52,417,407 50,797,221 51,454,239
============= ============= ============
Liabilities
Current liabilities
Trade and other payables 200,100 1,242,344 1,098,512
------------- ------------- ------------
Total liabilities 200,100 1,242,344 1,098,512
Equity
Ordinary shares 46,068 40,044 44,481
Share premium reserve 82,981,325 79,381,308 81,398,084
Merger reserve 77,130,684 77,130,684 77,130,684
Reverse acquisition
reserve (53,846,526) (53,846,526) (53,846,526)
Share-based payments
reserve 3,747,915 3,024,905 3,381,645
Retained earnings (57,842,159) (56,175,538) (57,752,641)
------------- ------------- -----------------
Total equity 52,217,305 49,554,877 50,355,727
------------- ------------- -----------------
Total equity and liabilities 52,417,407 50,797,221 51,454,239
============= ============= =================
These unaudited interim financial statements were approved by
the Directors and authorised for issue on 27 September 2018.
Simon Potter, Chief Executive Edward Shallcross, Director
Officer
Consolidated cash flow statement
for the six months ended 30 June 2018
Note 30 June 30 June 31 December
2018 2017 2017
(Unaudited) (Unaudited) (Audited)
$ $ $
Cash flows from operating activities
Payments to suppliers and employees (1,189,103) (789,128) (2,173,444)
Net cash used in operating activities (1,189,103) (789,128) (2,173,444)
------------- ------------- ------------
Cash flows from investing activities
Purchase of property, plant and
equipment (30,095) - (18,241)
Payments for exploration and
evaluation assets (136,293) (87,045) (241,197)
Decrease in restricted cash 500,000 - 13,455
Other income 2 500,000 24,253 36,253
Interest received 5,308 429 3,507
Net cash generated by/(used in)
investing
activities 838,920 (62,363) (206,223)
------------- ------------- ------------
Cash flows from financing activities
Proceeds from issuance of ordinary
shares 1,584,828 1,198,990 3,220,210
------------- ------------- ------------
Net cash flows from financing
activities 1,584,828 1,198,990 3,220,210
------------- ------------- ------------
Net decrease in cash and cash
equivalents 1,234,645 347,499 840,543
------------- ------------- ------------
Cash and cash equivalents at
the beginning of the period 1,838,527 970,021 970,021
Effects of exchange rate changes
on cash and cash equivalents 5,713 72,870 27,963
------------- ------------- ------------
Cash and cash equivalents at
the end of the period 3,078,885 1,390,390 1,838,527
------------- ------------- ------------
1. Basis of preparation
The unaudited consolidated interim financial information has
been prepared using the recognition and measurement principles of
International Accounting Standards, International Financial
Reporting Standards and Interpretations adopted for use in the
European Union (collectively "EU IFRSs"). The principal accounting
policies used in preparing the interim results are unchanged from
those disclosed in the Company's financial statements for the year
ended 31 December 2017. It is not expected that there will be any
changes or additions to these in the annual financial statements
for the year ended 31 December 2018.
While the financial information included in this interim
consolidated financial information has been prepared in accordance
with the recognition and measurement criteria of EU IFRSs, this
consolidated interim financial information does not itself contain
sufficient information to comply fully with EU IFRSs.
The interim financial information for the six months ended 30
June 2018 and 30 June 2017 is unaudited and does not constitute the
Company's statutory financial statements for those periods. The
comparative financial information for the full year ended 31
December 2017 has, however, been derived from the Company's
statutory financial statements for that period. The auditor's
report on those statutory financial statements was unqualified.
In the opinion of the directors, the accompanying interim
financial information includes all adjustments considered necessary
for fair and consistent presentation of the interim financial
statements. The interim financial statements have been prepared on
the going concern basis, assuming that the Group will realise its
assets and extinguish its liabilities in the normal course of
business at the amounts recognised within the interim financial
statements.
Carrying Value of Intangible Exploration and Evaluation
Assets
Expenditure of $48,454,371 relating to the cost of exploration
licences, geological and geophysical consultancy and seismic data
acquisition and interpretation has been capitalised as at 30 June
2018 (30 June 2017: $48,139,702) (31 December 2017:
$48,318,079).
Ultimate recoupment of exploration and evaluation assets
capitalised is dependent on successful development and commercial
exploitation, or alternatively, sale of the respective licence
areas. The carrying value of the Group's exploration and evaluation
expenditure is reviewed at each balance sheet date and, if there is
any indication that it is impaired, its recoverable amount is
estimated. Estimates of impairment are limited to an assessment by
the Directors of any events or changes in circumstances that would
indicate that the carrying value of the asset may not be fully
recoverable. Any impairment loss arising is charged to the
statement of comprehensive income.
On 26 April 2018 the Company filed its application for
Environmental Authorisation ("EA") as required by the Petroleum
(Offshore Environmental Protection and Pollution Control)
Regulations 2016 (the "Regulations"). Under these newly implemented
regulations, an application for EA represents the first step in
commencing field activities and therefore the submission of the
application by BPC represents an important milestone in the project
and its development, with the next key milestone being the
execution of an exploration well before the end of the current
licence term. The Company is presently in ongoing discussion with
the Government in relation to the process by which the application
will be progressed in a timely manner.
In performing an assessment of the carrying value of the
exploration and evaluation assets at the reporting date, the
Directors concluded that it was not appropriate to book an
impairment given the remaining term of the licences, geological
probability of success of the structures and the continued plans to
explore and develop the block.
Renewal of the Miami licence remains under review as at the
balance sheet date.
2. Other Income
Other income during the period consists of payments received in
consideration for having entered into a period of exclusive
discussions with a major international oil company as announced by
the Company on 3 May 2018. Payments received during the reporting
period of $500,000 relate to the period from 1 May 2018 to 30 June
2018, with further payments totalling $500,000 having been received
after the balance sheet date relating to the period from 1 July
2018 to 31 August 2018. Following the election of the counterparty
not to further extend the exclusivity agreement beyond its expiry
on 31 August 2018 no further payments are receivable by the Company
under this agreement.
3. Events after the balance sheet date
On 25 July 2018, the Company allotted an additional 2,640,000
ordinary shares in the Company in satisfaction of the exercise of
warrants which had been issued in conjunction with the placing of
44,000,000 new shares with institutional investors on 29 May 2018.
The shares were allotted for consideration of 2.5 pence each,
resulting in a total of 1,572,719,096 ordinary shares in issue
following this allotment.
On 6 August 2018, the Company agreed a variety of remuneration
changes with the Chief Executive Officer, taking effect from 1 July
2018, which significantly reduced the basic salary and included the
cancellation of accrued conditional entitlements to cash payments
and pension contributions. As at 30 June 2018, amounts totalling
$1,012,500 had been accrued with regards to conditional cash
entitlements and $225,000 had been accrued with regards to
conditional pension contribution entitlements. As the Company has
determined this transaction to be an adjusting event these accruals
have been written back to the consolidated statement of
comprehensive income for the period to 30 June 2018, resulting in a
negative employee benefit expense for this period.
On 24 August 2018, the Company announced that the exclusivity
agreement entered into with a major international oil company would
not be extended beyond its expiry on 31 August 2018. For further
details see note 2 to these interim financial statements.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR LQLLLVKFXBBF
(END) Dow Jones Newswires
September 27, 2018 02:02 ET (06:02 GMT)
Challenger Energy (LSE:CEG)
Historical Stock Chart
From Apr 2024 to May 2024
Challenger Energy (LSE:CEG)
Historical Stock Chart
From May 2023 to May 2024