TIDMNEW
RNS Number : 6261T
New World Oil & Gas
31 March 2016
New World Oil and Gas Plc / Index: AIM / Epic: NEW / Sector: Oil
& Gas
31 March 2016
New World Oil and Gas Plc ('New World' or the 'Company')
Final Results
New World Oil and Gas Plc, announces its final audited results
for the year ended 31 December 2015. The audited accounts are
available on the Company's website: www.nwoilgas.com, and extracts
are set out below.
Chairman's Statement
Sustained volatility in global oil and gas markets dominated the
year under review. Prices have since fallen to levels not seen for
the best part of a decade. Low prices are clearly not good news for
the oil and gas industry, particularly for those companies looking
to raise funds for exploration or development. I am pleased to
report that thanks to the steps we have taken during the period,
New World stands out from the crowd, for the right reasons: we have
a strong balance sheet a healthy cash balance and no licence
commitments. As a result, the Company is well placed to review a
number of opportunities to secure its long-term future.
We recognised early on that oil prices were set to stay 'lower
for longer'. We therefore took the decision to conserve the
Company's cash balances to ensure we are able to move quickly on
opportunities that meet our investment criteria from a position of
strength. As a result, cash conservation has been the focus of the
year. This goes beyond merely maintaining a strict control on
costs. We have also undertaken a rationalisation of our portfolio
of projects to ensure that there are no licence commitments that
would act as a draw on our cash balances in the short term. We took
the decision to relinquish the Danica Jutland 1/09 and 2/09 and
Danica Resources 1/08 licences onshore Denmark in September 2015.
New World had progressed these licences to the point where, despite
identifying good resource potential, we were only prepared to
invest in further exploration alongside a partner. It became
increasingly clear that, with markets where they were and continue
to be today, the appetite among suitable partners has
diminished.
Following our exit from Denmark, New World's licence in Belize
remains in force, unless extended, until 31 October 2016 and we
continue actively to manage our interests and obligations and to
seek partners whilst incurring only minimal administrative
expenses. However we consider it prudent to make a full provision
in the accounts against the carrying value of this asset as the
outcome cannot be determined with certainty.
In tandem with managing our cash balance, we have also been
working hard to pursue monies owed to New World. We have commenced
the legal process to recover the outstanding loans in respect of
the Al Maraam transaction. In addition, we were pleased to announce
in December 2015 that the loans made to director Georges Sztyk and
former director Peter Sztyk through Dynamic Investments Limited
have now been re-paid in full including interest charged at 3% per
annum. The loan to William Kelleher, the former CEO and Chairman of
New World, remains outstanding and we continue to review options on
how to recover monies due.
At the strategic level, the volatile market conditions triggered
a debate over the future direction of the Company and prompted a
number of changes to the Board. Nicholas Lee and Adam Reynolds, two
highly experienced executives with proven track records in
successfully developing and implementing new strategies for a wide
range of companies, were appointed directors. Nicholas and Adam
replace Fred Hodder, who stood down as a non-executive Director at
the Company's AGM, and Peter Sztyk, who chose to not to be
re-elected to the Board following his retirement by rotation. Peter
and Fred were instrumental in ensuring New World remained
financially sound during these uncertain times and I would like to
thank them both for the important contribution they made to the
Company.
Financial Review
For the period under review, due to the explorative nature of
the Company combined with depressed global oil prices and the
prudent approach adopted to the carrying value of its intangible
assets, the Company is reporting a loss of US$4.2 million (vs loss
of US$11.7 million in 2014). This loss has been arrived at after
charging impairment provisions of intangible assets of US$2.2
million, administrative expenses of US$1.5 million and legal and
professional costs of US$0.5 million. Included in the 2015 results
are US$0.1 million of expenses related to the unsuccessful placing
proposed in May 2015 and US$0.1 million of legal and professional
fees for dealing with shareholder groups.
With the successful completion of a Placing and Open Offer in Q3
2015, the Company raised US$5.4 million through the issue of 3.9
billion shares. Net of fundraising expenses of US$1.2 million, the
Company recognised net proceeds of US$4.3 million. The current cash
position of the Company excluding any funds owed to the Company
pursuant to the Al Maraam SPA and the outstanding Director loan,
stands at approximately US$3.2 million.
Corporate Review
Along with the previously mentioned changes to the Board, the
Directors have continued and intensified cost controls through
salary reductions and limiting third party expenditure. Cornhill
Capital Limited was appointed Broker to the Company, and conducted
a successful Open Offer and Placing. As a result, the Company now
has sufficient funding to take advantage of potential market
opportunities.
Outlook
Whilst oil prices appear to be bottoming out, we do not see the
oil and gas industry recovering sufficiently in the near future to
generate enthusiasm in capital markets to fund new ventures. We
intend to maintain a tight control on costs and manage overheads to
a minimum whilst exploring all options available to the Company. We
believe that we will be able to secure an attractive value
accretive option to deliver shareholder value and a long-term
future for New World and we plan to provide further updates in due
course.
Christopher Einchcomb
Acting Non-executive Chairman
31 March 2016
Operations Report
The Blue Creek PSA termination date was successfully extended to
31 October 2016. The Group is actively looking for a farm-in
partner for the Blue Creek PSA to reduce future costs and help
de-risk the project. Discussions with potential interested parties
continue.
During the past year, the Danish licences were relinquished as
the Company was unable to locate a farm-in partner to assume
financial responsibility for a possible drilling programme. All
contract obligations have been fulfilled and as such we have
received formal notification from the Danish Energy Agency that no
outstanding obligations remain. The Company will finalise its
relationships with its partner, the North Sea Fund, in due
course.
Georges Sztyk
Executive Director
31 March 2016
Enquiries:
Georges Sztyk New World Oil and Tel: +1 646 407
Gas Plc 9946
Roland Cornish Beaumont Cornish Tel: +44 (0) 20
Limited 7628 3396
Felicity Geidt Beaumont Cornish Tel: +44 (0) 20
Limited 7628 3396
Nicholas Bealer Cornhill Capital Tel: +44 (0) 20
Limited (Broker) 7710 9612
Andrew Frangos Cornhill Capital Tel: +44 (0) 20
Limited (Broker) 7710 9611
Lottie Brocklehurst St Brides Partners Tel: +44 (0) 20
Ltd 7236 1177
Frank Buhagiar St Brides Partners Tel: +44 (0) 20
Ltd 7236 1177
Definitions
"Al Maraam SPA" the share purchase agreement entered
into between the Company and Shareholders
of Al Maraam Al-Ahliya Company
for General Contracting WLL dated
10 May 2014
--------------------- -------------------------------------------
"Al Maraam" Al Maraam Al-Ahliya Company for
General Contracting WLL
--------------------- -------------------------------------------
"Blue Creek FOA" the farm out agreement dated 15
June 2011 (as amended) between
BCE and NWOG Belize
--------------------- -------------------------------------------
"Blue Creek Project" means the Blue Creek project,
being the acreage covered by the
Blue Creek PSA
--------------------- -------------------------------------------
"Blue Creek PSA" the production sharing agreement
dated 12 October 2007 (as
amended) between the Government
of Belize and BCE
--------------------- -------------------------------------------
"NWOG Belize" New World Oil and Gas (Belize)
Limited, a wholly owned
subsidiary of the Company, incorporated
in Belize
--------------------- -------------------------------------------
"NWOG Belize New World Oil and Gas (Belize
Operations" Operations) Limited, a wholly
owned subsidiary of the Company,
incorporated in Belize
--------------------- -------------------------------------------
FINANCIAL STATEMENTS
(MORE TO FOLLOW) Dow Jones Newswires
March 31, 2016 02:01 ET (06:01 GMT)
Group Statement of Comprehensive Income for the year ended 31
December 2015
Notes 2015 2014
$000's $000's
Revenue - -
Impairment of intangible
assets (2,172) (10,500)
Administrative expenses (1,528) (2,665)
Legal and professional
costs (530) (336)
________ ________
Loss from operations 3 (4,230) (13,501)
Interest receivable 6 10 24
Provision for losses
on financial instrument - (171)
Gain on contract settlement - 1,939
________ ________
Loss before
taxation (4,220) (11,709)
________ ________
Income tax 7 - -
________ ________
Loss for the
year (4,220) (11,709)
======= =======
Other comprehensive - -
income
________ ________
Total comprehensive
loss for the year attributable
to equity holders of
the parent (4,220) (11,709)
________ ________
Loss per share (cents)
Basic 8 (0.16) (1.67)
________ ________
Diluted 8 (0.16) (1.67)
________ ________
Group Statement of Financial Position as at 31 December 2015
Notes 2015 2014
$000's $000's
Assets
Non-current
assets
Tangible assets 9 - 14
Intangible assets 10 - 2,112
________ ________
Total non-current
assets - 2,126
Current assets
Inventories 11 - 50
Trade and other
receivables 12 - 517
Cash and cash
equivalents 3,642 1,144
________ ________
Total current
assets 3,642 1,711
________ ________
Total assets 3,642 3,837
________ ________
Liabilities
Current liabilities
Trade and other payables 13 (739) (1,025)
________ ________
Total liabilities (739) (1,025)
________ ________
Net assets 2,903 2,812
======= =======
Equity
Share capital 14 - -
Share premium 52,232 47,369
Share-based payment
reserve 368 920
Retained loss (49,697) (45,477)
________ ________
2,903 2,812
======= =======
The financial statements were approved by the board of directors
and authorised for issue on 31 March 2016. They were signed on its
behalf by
Georges Sztyk Adam Reynolds
Director Director
Company Statement of Financial Position as at 31 December
2015
Notes 2015 2014
$000's $000's
Assets
Non-current
assets
Tangible assets 9 - 14
Investment in subsidiaries 17 26 26
Amounts due from
subsidiaries 12 - 2,003
________ ________
Total non-current
assets 26 2,043
Current assets
Trade and other
receivables 12 - 517
Cash and cash equivalents 3,618 1,089
________ ________
Total current
assets 3,618 1,606
________ ________
Total assets 3,644 3,649
Liabilities
Current liabilities
Trade and other payables 13 (715) (832)
________ ________
Total liabilities (715) (832)
________ ________
Net assets 2,929 2,817
======= =======
Equity
Share capital 14 - -
Share premium 52,232 47,369
Share-based payment
reserve 368 920
Retained loss (49,671) (45,472)
________ ________
2,929 2,817
======= =======
The financial statements were approved by the board of directors
and authorised for issue on 31 March 2016. They were signed on its
behalf by
Georges Sztyk Adam Reynolds
Director Director
Group Statement of Cash Flows for the year ended 31 December
2015
2015 2014
$000's $000's
Cash flows from operating
activities
Operating loss (4,230) (13,501)
Depreciation 14 15
Impairment of intangible
assets 2,172 10,500
Gain on contract
settlement - 1,939
Decrease in receivables 517 796
(Decrease)/increase
in payables (286) 470
Decrease in inventories 50 40
________ ________
Net cash (outflow)/inflow
from operating activities (1,763) 259
________ ________
Returns on investments and
servicing of finance
Interest received 10 24
________ ________
Net cash inflow from
returns on investments
and servicing of finance 10 24
________ ________
Cash flows from investing
activities
Net proceeds from disposal - -
of tangible assets
Payments to acquire
intangible assets (60) (263)
________ ________
Net cash outflow from
investing activities (60) (263)
________ ________
Cash flows from financing
activities
Proceeds on issuing 5,431 -
of ordinary shares
Cost of issue of ordinary (1,120) -
shares
Net conversion of financial
instrument - 16
________ ________
Net cash inflow from
financing activities 4,311 16
________ ________
Net increase in cash and
cash equivalents 2,498 36
Cash and cash equivalents
at beginning of year 1,144 1,108
________ ________
Cash and cash equivalents
at end of year 3,642 1,144
________ ________
(MORE TO FOLLOW) Dow Jones Newswires
March 31, 2016 02:01 ET (06:01 GMT)
Company Statement of Cash Flows for the year ended 31 December
2015
2015 2014
$000's $000's
Cash flows from operating
activities
Operating loss (4,209) (13,496)
Provision against amounts
due from subsidiary 2,236 10,418
Depreciation 14 15
Gain on contract
settlement - 1,939
Decrease in receivables 517 789
(Decrease)/increase
in payables (117) 434
________ ________
Net cash (outflow)/inflow
from operating activities (1,559) 99
________ ________
Returns on investments and
servicing of finance
Interest received 10 24
________ ________
Net cash inflow from
returns on investments
and servicing of finance 10 24
________ ________
Cash flows from investing
activities
Advances to subsidiaries (233) (36)
________ ________
Net cash outflow from
investing activities (233) (36)
________ ________
Cash flows from financing
activities
Proceeds on issuing of 5,431 -
ordinary shares
Cost of issue of ordinary (1,120) -
shares
Net conversion of financial
instrument - 16
________ ________
Net cash inflow from
financing activities 4,311 16
________ ________
Net increase in cash and
cash equivalents 2,529 103
Cash and cash equivalents
at beginning of year 1,089 986
________ ________
Cash and cash equivalents
at end of year 3,618 1,089
======= =======
Group Statement of Changes in Equity for the year ended 31
December 2015
Share Share-based Retained
premium payments Losses Total
reserve
$000's $000's $000's $000's
Balance at 1 January
2014 47,369 920 (33,768) 14,521
Total comprehensive
loss for the year - - (11,709) (11,709)
________ ________ ________ ________
Balance at 31 December
2014 47,369 920 (45,477) 2,812
________ ________ ________ ________
Balance at 1 January
2015 47,369 920 (45,477) 2,812
Share issue 5,431 - - 5,431
Cost of share
issue (1,120) - - (1,120)
Expiration of unexercised
warrants 552 (552) - -
Total comprehensive
loss for the year - - (4,220) (4,220)
________ ________ ________ ________
Balance at 31 December
2015 52,232 368 (49,697) 2,903
________ ________ ________ ________
Company Statement of Changes in Equity for the year ended 31
December 2015
Share Share-based Retained
premium payments Losses Total
reserve
$000's $000's $000's $000's
Balance at 1 January
2014 47,369 920 (33,768) 14,521
Total comprehensive
loss for the year - - (11,704) (11,704)
________ ________ ________ ________
Balance at 31 December
2014 47,369 920 (45,472) 2,817
________ ________ ________ ________
Balance at 1 January
2015 47,369 920 (45,472) 2,817
Share issue 5,431 - - 5,431
Cost of share
issue (1,120) - - (1,120)
Expiration of unexercised
warrants 552 (552) - -
Total comprehensive
loss for the year - - (4,199) (4,199)
________ ________ ________ ________
Balance at 31 December
2015 52,232 368 (49,671) 2,929
________ ________ ________ ________
Notes to the financial statements for the year ended 31 December
2015
1 Summary of significant accounting policies
General information and authorisation of financial
statements
New World Oil & Gas Plc is a public limited company
incorporated in Jersey. The address of its registered office is
Ogier House. The Company's ordinary shares are traded on the AIM
Market operating by the London Stock Exchange. The Group financial
statements of New World Oil and Gas Plc for the year ended 31
December 2015 were authorised for issue by the Board on 31 March
2016 and the statements of financial position signed on the Board's
behalf by Georges Sztyk and Adam Reynolds.
Statement of compliance with IFRS
The Group's financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS).
The Company's financial statements have been prepared in accordance
with IFRS as adopted by the European Union and as applied in
accordance with the provisions of the Companies (Jersey) Law 1991.
The principal accounting policies adopted by the Group and Company
are set out below.
Financial risk management
The Group's principal activity of oil and gas exploration is by
nature unpredictable with inherent risk exposure. In terms of
general risk management the Board of Directors determine, as
required, the degree to which it is appropriate to use financial
instruments to mitigate risk. Currently the Company's principal
financial instruments comprise cash and equity capital.
The Company does not enter into complex derivatives to manage
risk, however it entered into an equity swap arrangement in 2013.
The equity swap was settled in 2014 and a loss of $171,000 was
recognized. The Company had no financial instrument loss in
2015.
Foreign currency risk
Foreign exchange risk arises because the Group has operations
located in various parts of the world whose functional currency is
not US Dollars. The Group's net assets are exposed to currency risk
giving rise to gains or losses on retranslation into US
Dollars.
Liquidity risk
The Company's policy throughout the year has been to ensure that
it has adequate liquidity by careful management of its working
capital.
Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
The most critical estimations involve the impairment or
otherwise of carrying values related to Exploration and Project
Development expenses, which are performed for both the interim and
annual financial statements.
New standards, amendments and interpretations adopted by the
Company
No new and/or revised Standards and Interpretations have been
required to be adopted, and/or are applicable in the current year
by/to the Company, as standards, amendments and interpretations
which are effective for the financial year beginning on 1 January
2015 are not material to the Company.
New standards, amendments and interpretations not yet adopted by
the Company
At the date of authorisation of these financial statements, the
following Standards and Interpretations which have not been applied
in these financial statements, were in issue but not yet effective
for the year presented:
IFRS 9 in respect of Financial Instruments which will be
effective for the accounting periods beginning on or after 1
January 2018.
IFRS 14 in respect of Regulatory Deferral Accounts which will be
effective for accounting periods beginning on or after 1 January
2016.
IFRS 15 in respect of Revenue from Contracts with Customers
which will be effective for accounting periods beginning on or
after 1 January 2017.
Amendments to IFRS 10, IFRS 12 and IAS 28 in respect of the
application of the consolidation exemption to investment entities
which will be effective for accounting periods beginning on or
after 1 January 2016.
(MORE TO FOLLOW) Dow Jones Newswires
March 31, 2016 02:01 ET (06:01 GMT)
Amendments to IFRS 10 and IAS 28 in respect of the treatment of
a Sale or Contribution of Assets between an Investor and its
Associate or Joint Venture which will be effective for accounting
periods beginning on or after 1 January 2016.
Amendments to IFRS 11 in respect of Accounting for Acquisitions
of Interest in Joint Operations which will be effective for
accounting periods beginning on or after 1 January 2016.
Amendments to IAS 1 in respect of determining what information
to disclose in annual financial statements which will be effective
for accounting periods beginning on or after 1 January 2016.
Amendments to IAS 16 and IAS 38 in respect of Clarification of
Acceptable Methods of Depreciation and Amortisation which will be
effective for accounting periods beginning on or after 1 January
2016.
Amendments to IAS 16 and IAS 41 in respect of Bearer Plants
which will be effective for accounting periods beginning on or
after 1 January 2016.
Amendments to IAS 27 to allow entities to use the equity method
to account for investments in subsidiaries, joint ventures and
associates which will be effective for accounting periods beginning
1 January 2016.
Annual improvements to IFRS's which will be effective for
accounting periods beginning on or after 1 January 2016 as
follows:
IFRS 5 - Changes in methods of disposal
IFRS 7 - Servicing contracts
IFRS 7 - Applicability of the amendments to IFRS 7 to condensed
interim financial statements
IAS 19 - Discount rate: Regional market issue
IAS 34 - Disclosure of information "elsewhere in the interim
financial report"
There are no other IFRSs or IFRIC interpretations that are not
yet effective that would be expected to have a material impact on
the Company.
Basis of preparation
The consolidated financial statements have been prepared on the
historical cost basis and on a going concern basis.
The financial report is presented in United States Dollars ($),
which is the Group's functional and reporting currency, and all
values are rounded to the nearest thousand dollars ($'000) unless
otherwise stated.
Basis of consolidation
Where the Company has the power, either directly or indirectly,
to govern the financial and operating policies of another entity or
business so as to obtain benefits from its activities, it is
classified as a subsidiary. The consolidated financial statements
present the results of the Company and its subsidiaries ("the
Group") as if they formed a single entity. Intercompany
transactions and balances between Group companies are therefore
eliminated in full.
Business combinations and goodwill
On acquisition, the assets and liabilities of a subsidiary are
measured at their fair values at the date of acquisition. Any
excess of the cost of acquisition over the fair values of the
identifiable net assets acquired is recognised as goodwill.
Revenue recognition
The Group has not yet commenced generating revenue.
Segment Reporting
Operating segments are reported in a manner consistent with
internal reporting provided to the chief operating decision-maker
who is responsible for allocated resources and assessing
performance of the geographical segments. The chief operating
decision-maker has been identified as Christopher Einchcomb, Acting
Non-Executive Chairman.
Foreign Currencies
Transactions in currencies other than US Dollars are recorded at
the rates of exchange prevailing on the dates of the transactions.
At each balance sheet date, monetary assets and liabilities that
are denominated in foreign currencies are retranslated at the rates
prevailing on the balance sheet date. Gains and losses arising on
retranslation are included in the income statement for the period.
On consolidation, the results of overseas operations are translated
into US Dollars at rates approximating to those ruling when the
transactions took place. All assets and liabilities of the overseas
operations are translated at the rate ruling at the balance sheet
date.
Taxation
No charge to Jersey corporation tax arises on the results for
the year due to the applicable zero tax rate.
The subsidiary companies have not generated any income therefore
there are no tax consequences arising from Danish or Belize
corporate income tax matters.
Tangible Fixed Assets
Tangible fixed assets comprise furniture and fixtures and plant
and equipment and are depreciated on a straight line basis at
annual rates that will reduce book values to estimated residual
values over their estimated useful lines as follows:
Furniture - 25% per annum
Plant and Equipment - 20% per annum
Intangible Fixed Assets
Exploration, evaluation and development expenditures incurred,
together with appropriate overhead expenses such as project
management and related travel, is accumulated in respect of each
identifiable area of interest.
These costs are only carried forward to the extent that they are
expected to be recouped through the successful development of the
area or where activities in the area have not yet reached a stage
which permits reasonable assessment of the existence of
economically recoverable reserves of oil and/or gas.
Accumulated costs in relation to an abandoned area are written
off in full in the year in which the decision to abandon is
made.
Impairment of intangible assets
At each balance sheet date the Group reviews the carrying
amounts of its intangible assets to determine whether there is any
indication that those assets have suffered an impairment loss. If
there is such indication then an estimate of the asset's
recoverable amount is performed and compared to the carrying
amount.
Recoverable amount is the higher of fair value less costs to
sell and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value. Where the
asset does not generate cash flows that are independent from other
assets, the Group estimates the recoverable amount of the
cash-generating unit to which the asset belongs.
If the recoverable amount of an asset is estimated to be less
than its carrying amount, the carrying amount of the asset is
reduced to its recoverable amount. An impairment loss is recognised
as an expense immediately, unless the relevant asset is carried at
a re-valued amount, in which case the impairment loss is treated as
a revaluation decrease.
Financial instruments
Financial assets and financial liabilities are recognised on the
statement of financial position when the Group has become a party
to the contractual provisions of the instrument.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, cash at bank
and short term deposits with banks and similar financial
institutions.
Inventory
Inventories, representing drilling and related consumables, are
stated at the lower of cost and net realisable value, cost being
determined by the first-in first-out method.
Trade and other receivables
Trade and other receivables do not carry any interest and are
stated at their nominal value as reduced by appropriate allowances
for estimated irrecoverable amounts.
Trade and other payables
Trade and other payables are non-interest bearing and are stated
at their nominal value.
Equity instruments
Equity instruments issued by the Company are recorded at the
proceeds received, net of direct issue costs.
Share-based payments
The Group operated a Long Term Incentive Plan to allow certain
Directors (being the Directors at the time of initial AIM
admission) to be granted awards in respect of Ordinary Shares in
the Company. This plan lapsed in 2014 with no amount being due to
any Director. The Group also operates a Discretionary Annual Bonus
Plan which may be paid in Ordinary Shares; however, this plan was
suspended by the Directors in 2014. As at 31 December 2015 no
amounts have been provided or accrued in relation to the above
schemes.
The fair value of Options granted to the Non-Executive Directors
to subscribe for Ordinary Shares is recognised as an expense equal
to the fair value of the services provided.
Additionally, the fair value of warrants to subscribe for
Ordinary Shares as part of the fees under Placing arrangements and
as part of the fees under the Re-Admission to AIM have been
recognised as an expense or allocated to share issue costs as
applicable.
The fair value of warrants and options granted is determined
using the Black-Scholes valuation model.
Going Concern
The Group closely monitors and manages its liquidity risk,
regularly preparing cash forecasts. The Directors consider that the
Group has adequate liquid resources to continue in operational
existence for at least the 12 month period from the date of
approval of these financial statements.
2 Turnover and segmental analysis
Segment information is presented in respect of the Group's
management and internal reporting structure. The Group had no
revenue during the year.
Segment results, assets and liabilities include items directly
attributable to a segment as well as those that can be allocated on
a reasonable basis.
Operating and Geographical segments
The Group comprises the following operating segments:
Corporate - Parent company administrative costs, general
business development and AIM related costs.
(MORE TO FOLLOW) Dow Jones Newswires
March 31, 2016 02:01 ET (06:01 GMT)
Exploration & development - costs in relation to the Group's
direct oil and gas exploration operations.
2015 Corporate Exploration Total
Business segments & development
$000's $000's $000's
Result
Segment results (1,963) (2,257) (4,220)
======= ======= =======
Balance
sheet
Segment
assets 3,617 25 3,642
Segment
liabilities (715) (24) (739)
________ ________ ________
Net assets 2,902 1 2,903
======= ======= =======
Geographical Denmark Belize Jersey Total
segments
$000's $000's $000's $000's
Result
Segment result (623) (1,634) (1,963) (4,220)
======= ======= ======= =======
Balance sheet
Segment assets - - - - -
Intangible
- Other 12 13 3,617 3,642
Segment liabilities (24) - (715) (739)
________ ________ ________ ________
Net assets (12) 513 2,902 2,903
======= ======= ======= =======
2014 Corporate Exploration Total
Business segments & development
$000's $000's $000's
Result
Segment results (1,082) (10,627) (11,709)
======= ======= =======
Balance
sheet
Segment
assets 1,620 2,217 3,837
Segment
liabilities (832) (193) (1,025)
________ ________ ________
Net assets 788 2,024 2,812
======= ======= =======
Geographical Denmark Belize Jersey Total
segments
$000's $000's $000's $000's
Result
Segment result (7,088) (3,539) (1,082) (11,709)
======= ======= ======= =======
Balance sheet
Segment assets -
Intangible 550 1,562 - 2,112
- Other 46 59 1,620 1,725
Segment liabilities (193) - (832) (1,025)
________ ________ ________ ________
Net assets 403 1,621 788 2,812
======= ======= ======= =======
3 Group operating loss
2015 2014
$000's $000's
Loss from operations has
been arrived at after charging:
Directors fees 218 379
Directors Executive
Remuneration (i) 504 1,365
Auditors Remuneration
- Group 67 104
- Subsidiary 21 46
Depreciation 14 15
======= =======
(i) 2014 includes $115,500 of consulting fees to Hydrocarbon
Technologies Ltd. for the period from Kelleher's resignation to 30
April 2015 of which $77,000 was applied as payments on the
Hydrocarbon Technologies Ltd. loan.
4 Auditor remuneration disclosure
2015 2014
$000's $000's
Fees payable to the Company's
auditor for the audit of
the Company's annual accounts 43 76
Fees payable to the Company's
auditor for other services:
Audit-related assurance
services 24 28
======= =======
5 Directors' remuneration
Management Fees Total
Services
2015 $000's $000's $000's
Executive Directors:
Peter Sztyk (ii) (resigned
17/11/2015) 252 28 280
Georges Sztyk
(ii) 252 30 282
Non-Executive
Directors:
Stephen Polakoff (iii) (includes
fees payable in shares of $18,000) - 48 48
Chris Einchcomb (iii) (includes
fees payable in shares of $20,000) - 46 46
Fred Hodder (iii) (includes fees
payable in shares of $23,000)
(resigned 17/11/2015) - 50 50
Adam Reynolds (elected 17/11/2015) - 8 8
Nicholas Lee (elected 17/11/2015) - 8 8
====== ====== ======
504 218 722
====== ====== ======
Management Fees Total
Services
2014 $000's $000's $000's
Executive Directors:
Bill Kelleher (i)
(resigned 13/10/2014) 579 25 604
Peter Sztyk
(ii) 393 30 423
Georges Sztyk
(ii) 393 30 423
Non-Executive
Directors:
Stephen Polakoff (iii) (includes
fees payable in shares of $35,000) - 88 88
Fred Hodder (iii) (includes fees
payable in shares of $54,000) - 115 115
Chris Einchcomb (iii) (includes
fees payable in shares of $45,000) - 91 91
====== ====== ======
1,365 379 1,744
====== ====== ======
(i) Management services provided by and payable to Hydrocarbon
Technologies Ltd. Includes $115,500 of consulting fees for the
period from Kelleher's resignation to 30 April 2015 of which
$77,000 was applied as payments on the Hydrocarbon Technologies
Ltd. loan.
(ii) Management services were provided by and payable to Dynamic Investments Ltd.
(iii) Fees payable in shares for 2015 totalling $62,000, for
2014 totalling $134,000 and for 2013 totalling $65,000 were issued
after year end, as discussed in Notes 20 and 24.
No pension benefits are directly provided for any Director.
6 Interest receivable
2015 2014
$000's $000's
Interest received on other
receivables 10 24
======= =======
7 Taxation
No charge to Jersey corporation tax arises on the results for
the year due to the applicable zero tax rate. No trading profit has
arisen in any other tax jurisdiction.
(MORE TO FOLLOW) Dow Jones Newswires
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No deferred tax asset has been recognised due to the applicable
zero tax rate, however the unrelieved tax losses which are
estimated to be available for offset against future profits if the
applicable tax rates were to change in the future amount to
approximately $30 million (2014: $30 million).
8 Loss per share
2015 2014
The calculation of loss per share
is based on the loss after taxation
divided by the weighted average
number of shares in issue during
the year:
Loss for the year ($000's) (4,220) (11,709)
Number of shares
Weighted average number of ordinary
shares for the purposes of basic
loss per share (millions) 2,588 703
Basic and diluted loss per share
(expressed in cents) (0.16) (1.67)
As inclusion of the potential ordinary shares would result in a
decrease in the earnings per share they are considered to be
anti-dilutive, as such, a diluted earnings per share is not
included.
9 Tangible assets - Group and Company
Furniture Plant
and and Total
Fixtures Equipment
$'000 $'000 $'000
Cost
Balance carried forward 17 40 57
Additions during - - -
year to 31 December
2015
Disposals during - - -
year to 31 December
2015
________ ________ ________
Carried forward at
31 December 2015 17 40 57
________ ________ ________
Depreciation
Balance carried forward 16 26 42
Charge for year to
31 December 2014 4 11 15
Charge for year to
31 December 2015 5 9 14
Eliminated on disposal (8) (6) (14)
________ ________ ________
Carried forward at
31 December 2015 17 40 57
________ ________ ________
Net Book Values
At 31 December 2015 - - -
======= ======= =======
At 31 December
2014 5 9 14
======= ======= =======
10 Intangible assets - Group 2015
Exploration
and Project
Development
Expenses
$'000
Cost
As at 1 January 2015 12,612
Additions 60
_______
As at 31 December
2015 12,672
_______
Accumulated amortisation
and impairment
As at 1 January 2015 (10,500)
Impairment
charge (2,172)
_______
Balance at 31 December
2015 (12,672)
_______
Net book value
As at 31 December -
2015
_______
As at 31 December
2014 2,112
_______
Exploration
and Project
Development
Expenses
$'000
Cost
As at 1 January
2014 12,349
Additions 263
_______
As at 31 December
2014 12,612
_______
Accumulated amortisation
and impairment
As at 1 January -
2014
Impairment
charge (10,500)
_______
Balance at 31 December
2014 (10,500)
_______
Net book value
As at 31 December
2014 2,112
_______
As at 31 December
2013 12,349
_______
In 2015, the Company relinquished it Danish licenses.
Accordingly, a charge to increase the impairment reserve for its
Denmark intangible assets to 100 per cent was recorded during the
year. The Directors also undertook an impairment review of the
Group's Belize intangible assets as of 31 December 2015 and
determined it prudent to impair the Belize intangible assets to 100
per cent based on the 2016 deadline for the Group to continue its
work programme, the availability of funds to do so, and the current
depressed global price of oil.
11 Inventories
Inventories were nil. The 2014 inventories were $50,000 and
comprised drilling and related consumables and were stated at the
lower of cost and estimated net realisable value.
12 Trade and other receivables
2015 2014
Group Company Group Company
Current trade and $000's $000's $000's $000's
other receivables
Other receivables
- Related Parties - - 517 517
- Al Maraam 1,368 1,368 1,368 1,368
- Provision for Al
Maraam (1,368) (1,368) (1,368) (1,368)
________ ________ ________ ________
- - 517 517
======= ======= ======= =======
Non - current trade
and other receivables
Amounts due from subsidiaries - 33,466 - 33,233
Provision - (33,466) - (31,230)
________ ________ ________ ________
- - - 2,003
======= ======= ======= =======
The amounts due from subsidiaries are interest free with
repayment not anticipated within 12 months of the end of the
reporting period.
The Directors consider that the net carrying amount of trade and
other receivables approximates to their fair value.
13 Trade and other payables - current
2015 2014
Group Company Group Company
$000's $000's $000's $000's
Trade payables 61 41 53 29
Accruals 678 674 972 803
________ ________ ________ ________
739 715 1,025 832
======= ======= ======= =======
The Directors consider that the carrying amount of trade
payables approximates to their fair value.
14 Share capital
2015 2014
Number Number
of of
shares Shares
Called up, allotted, issued
and fully paid:
As at 31 December
Ordinary shares of no par value 4,591,596,741 702,723,713
=========== =========
On 11 June 2015, the Company announced an Open Offer and Placing
to raise gross proceeds of $5.4 million (GBP3.5 million) through
the issue of 3,888,873,028 shares at a price of 0.09p per share and
these shares were duly allotted and issued on 7 July 2015.
The Company issued no shares in 2014.
15 Outstanding warrants and options
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As at 31 December 2015 the number of outstanding warrants and
options were:-
- 18,900,000 warrants exercisable at 2p expiring on 28 March 2016;
- 14,069,500 warrants exercisable at 5p expiring on 11 May 2016;
- 2,375,000 warrants exercisable at 8p expiring on 25 July 2017;
- 2,750,000 options exercisable at 9.25p expiring on 25 July 2022.
During the year 5,598,251 warrants exercisable at 9p lapsed
together with 6,375,000 warrants exercisable at 8p.
16 Share-based payments
The group operated a Long Term Incentive Plan to allow certain
Directors (being the Directors at the time of initial AIM
admission) to be granted awards in respect of Ordinary Shares in
the Company. This plan lapsed in 2014 with no amount being due to
any Director.
The Group also operates a Discretionary Annual Bonus Plan that
may be paid in Ordinary Shares; however, this plan was been
suspended by the Directors in 2014.
As at 31 December 2015 no amounts have been provided or accrued
in relation to the above schemes.
17 Investment in subsidiaries
2015 2014
$000's $000's
As at 1 January 26 26
Additions - -
________ ________
At 31 December 26 26
________ ________
The subsidiaries of New World Oil and Gas Plc, all of which have
been included in these consolidated financial statements, are as
follows:
Name Country Proportion Nature
of incorporation of ownership of business
interest
Directly-held subsidiaries
British
Virgin Holding
Gaia Resources Limited (1) Islands 100% Company
Holding
Emery SARL (2) Luxembourg 100% Company
New World Oil and Oil and
Gas (Belize) Limited (3) Belize 100% Gas Exploration
New World Oil and Gas Oil and
(Belize) Operations Limited (3) Belize 100% Gas Exploration
Indirectly-held subsidiaries
New World Jutland Oil and
Aps (4) Denmark 100% Gas Exploration
New World Operations Oil and
Aps (4) Denmark 100% Gas Exploration
New World Resources Oil and
Aps (5) Denmark 100% Gas Exploration
New World Resources Oil and
Operations Aps (5) Denmark 100% Gas Exploration
(1) Subsidiary was acquired on incorporation on 4 January 2011
(2) Subsidiary was acquired on incorporation on 1 August 2011
(3) Subsidiary was acquired on incorporation on 14 June 2011
(4) Subsidiary was acquired on incorporation on 15 September 2011
(5) Subsidiary was acquired on incorporation on 8 March 2012
18 Financial instruments
The Board of Directors determine, as required, the degree to
which it is appropriate to use financial instruments to mitigate
risk. Currently the Company's principal financial instruments
comprise cash and equity capital.
The Company does not enter into complex derivatives to manage
risk, however it entered into an equity swap arrangement in 2013 as
disclosed in note 19.
Foreign currency risk
Foreign exchange risk arises because the Group has operations
located in various parts of the world whose functional currency is
not the same as the functional currency in which the Group
companies are operating. The Group's net assets are exposed to
currency risk giving rise to gains or losses on retranslation into
US Dollars.
Liquidity risk
The Company's policy throughout the year has been to ensure that
it has adequate liquidity by careful management of its working
capital.
19 Derivative financial instrument
During March 2013 the Company entered into an equity swap
agreement ("the Equity Swap Agreement") with YA Global Master SPV,
Ltd ("YAGM") over 19,999,998 Ordinary Shares ("the Swap Shares").
In return for a payment by the Company to YAGM of GBP400,000
($606,000), six monthly settlement payments in respect of such
payment were to be made by YAGM to the Company, or by the Company
to YAGM, based on a formula related to the difference between the
prevailing market price (as defined in the Equity Swap Agreement)
of the Company's ordinary shares in any month and a 'benchmark
price' of 2.2p per share ($0.03). Thus the funds received by the
Company in respect of the Swap Shares are dependent on the future
price performance of the Company's ordinary shares.
During 2014, 3,333,333 shares were settled for net proceeds of
GBP10,000 ($16,000). The remaining balance has been fair valued at
31 December 2014, based on the settlement of the Equity Swap
Agreement subsequent to year end, with a resulting provision of
$171,000 included in the Income Statement.
31 December 31
2015 December
2014
$'000 $'000
Fair Value as at 1 January - 187
Settled during the year - (16)
Fair value adjustment
to 31 December - (171)
________ ________
Fair Value carried forward - -
as at 31 December
======= =======
20 Group related party transactions
Transactions between the parent and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not
disclosed in this note. Details of Director's remuneration, being
the only key personnel, are given in note 5.
Included within other receivables are the amounts outstanding on
the loans made to facilitate the Executive Directors participation
in the March 2013 placing. In relation to Bill Kelleher an advance
of $333,000 was made to Hydrocarbon Technologies Limited and after
interest charges of $2,000 (2014: $7,000) and repayments of $58,000
(2013: $77,000) were made the amount outstanding was $150,000
(2013: $205,000). As of 31 December 2014, a provision for
collectability in the amount of $150,000 has been recorded related
to this loan.
In relation to Peter Sztyk and Georges Sztyk an advance of
$667,000 was made to Dynamic Investments Limited and after interest
charges of $8,000 (2014: $16,000) and repayments of $469,000 (2014:
$122,000) were made the amount outstanding was nil (2014:
$461,000).
Included within trade and other payables is unpaid director's
fees payable in shares to Fred Hodder of $97,000 (2014: $79,000),
to Chris Einchcomb of $83,000 (2014: $66,000) and to Stephen
Polakoff of $72,000 (2014: $54,000) and unpaid director's fees
payable in cash to Nicholas Lee of $8,000 (2014: nil) and Adam
Reynolds of $8,000 (2014: nil). All unpaid director's fees were
paid subsequent to year end either through the issue of shares, see
Note 24, or through cash payments.
21 Ultimate controlling party
In the opinion of the directors, there is no controlling
party.
22 Retirement benefit scheme
The Group does not operate either a defined contribution or
defined benefit retirement scheme.
23 Commitments
As at 31 December 2015, the Group has no material commitments
unaccounted for in the financial statements.
24 Events after the end of the reporting period
On 17 February 2016, the Company announced an allotment of
155,189,367 new ordinary shares of the Company. This included
72,424,600 shares issued to directors of the Company and to a
former director in part settlement of director fees, see Notes 5
and 20. The balance of the allotment was to suppliers in relation
to Company operations.
25 Profit and loss account of the parent company
As permitted by Jersey Company Law, the profit and loss account
of the parent company has not been separately presented in these
accounts. The parent company loss for the year was $4,199,000
(2014: $11,704,000 loss).
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR AKKDNDBKBCNN
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March 31, 2016 02:01 ET (06:01 GMT)
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