Interim Results

RNS Number : 0278S

Fox Marble Holdings PLC

28 September 2017

 

AIM: FOX                                                                                                                             28 September 2017

Fox Marble Holdings plc

("Fox Marble" or the "Company")    

Interim Results for the six months ended 30 June 2017

Fox Marble Holdings plc (AIM: FOX), a dimension stone company focused on marble quarrying and finishing in Kosovo and the Balkans, announces its interim results for the six months ended 30 June 2017.

Operational Highlights 

·     Progress made in building Fox Marble into a vertically integrated production, processing and distribution company of quality marble.

·     New Kosovo factory now fully operational - able to cut, polish and resin marble slabs and tiles in-house to improve economies of scale, quarry yields and profit margins.

·     The Company has cut over 8,500 square metres of material to date producing high quality slabs cut within a 1mm tolerance.   

·     New sales contract entered into with OM Enterprises ("OM") in September 2017 to purchase a minimum of 5,000 tonnes of material over the three years. OM has committed to a $500,000 advance payment in respect of the first 2,500 tonnes of material to be delivered by March 2018, of which $200,000 had been received at the date of this report. 

·     Recurring block orders to large wholesalers in Turkey and India, including Mahadev Marble Pvt, RK Marble Pvt, and Simsekler Dogaltas Madencilik A.S.

·     Continued to secure offtake, distribution and sales agreements across Europe, US and Asia

·     Distribution agreement entered into with Pristine Stone in the United States to distribute Fox Marble material within this market.

·     Development of the Maleshevë quarry in Kosovo progressing well with 4,254 tonnes of material quarried in the period to 31 August 2017 (2016 - 990 tonnes).

Financial Highlights

·     Revenue from the sale of marble products for the six months to 30 June 2017 increased 26 % to €329,607 (H1 2016: €262,000).

·     Sales in the period from 1 July 2017 to 27 September 2017 of €304,345.  

·     Order book currently at €5.6m of which the company now expects €2.0m to be recognised within 2017 financial year (FY 2016: €801,040).  

·     Cash balance as at 30 June 2017 of €929,429 (2016: €2,686,341).  Cash balance as at 24 September 2017 of €296,613.

·     Facilities from Brandon Hill Limited available for draw down at 24 September 2017 of €1,008,000.

Chris Gilbert, CEO, commented: "We have been encouraged by the progress of marble sales in Q3 2017, which is showing a strong forward momentum with new and returning customers, despite the slower start to the first half of the year in terms of delivered sales.  

"Our strategy of establishing our material as premium natural stone installed in some of the most prestigious developments around the world is proving successful and the company is finally seeing volume sales of its material to a broad range of customers across multiple territories.

"Demand for stone from our Maleshevë quarry in Kosovo is currently outpacing production, and we are aiming to maximise yield ahead of the forecast annual winter shutdown of the quarries from mid December to February. 

"In addition, we are pleased to announce that our new processing factory in Kosovo is now operational. The factory has the capacity to produce up to 440,000 square metres per annum of cut and polished slabs. The factory has been stockpiled with a large number of blocks, which can be cut and processed during our planned quarry winter shutdown to fulfil orders for processed marble.

"As we move into our final quarter of 2017, we look forward to updating the market on a number of sales agreements which are currently under discussion with customers globally, which if secured will favourably impact our bottom line for FY 2017 and FY 2018."

For more information on Fox Marble please visit www.foxmarble.net  or contact:

Fox Marble Holdings plc
Chris Gilbert, Chief Executive Officer	Tel: [phone]
Fiona Hadfield, Finance Director	Tel: [phone]
Cairn Financial Advisers LLP (Nomad)
Liam Murray	Tel: [phone]
Brandon Hill Capital (Joint Broker)
Oliver Stansfield	Tel: [phone]
Beaufort Securities Limited (Joint Broker)
Elliott Hance	Tel: [phone]
Yellow Jersey
Felicity Winkles Georgia Colkin Katie Bairsto	Tel: [phone] Tel: [phone] Tel: [phone]

Notes to Editors:

Fox Marble (AIM:FOX), is a marble production, processing and distribution company in Kosovo and the Balkans region.  

Its marble products, which includes Illyric White, Illirico Selene, Grigio Argento and are gaining traction globally both to international wholesale companies as well as being supplied directly into luxury residential properties. In the UK these include among others St George's Homes and Capital and Counties Plc.'s Lillie Square development. In Sydney, Australia Rosso Cait, Alexandrian White and Breccia Paradisea marble have been used in what is expected to be Australia's most expensive property. These sales serve to demonstrate the desirability of Fox's premium marble products as the stone of choice in some of the most prestigious and expensive residential developments around the world. 

Fox Marble holds 40 year mining licences for six separate marble quarries with a maiden JORC resource indicating an in-situ valuation of approximately Euro 16.5 billion. Fox has taken three of the six sites into production (the Drini and Maleshevë quarries, both in Kosovo and from the Prilep Quarry in Macedonia) and continues to increase production. Notably, Fox has access to over 300 million cubic metres (over 1bn tons) of premium quality marble.

Marble demand continues to grow with stable pricing, predominantly driven by the construction and real-estate industries, on which Fox is looking to capitalise.

Operational Update

Sales and marketing update

·     Following the US $1.8m sale and purchase agreement with Mahadev Marmo PVT ltd ("Mahadev") signed in February 2017, the Company has made further progress in India.   We are making regular block sales to major marble wholesalers, including Mahadev and RK Marble Pvt Ltd, one of the largest marble companies in the world.  Materials sold include Illirico Selene, Alexandria White, Breccia Paradisea and Argento Grigio. 

·     In September 2017 Fox Marble signed a sales agreement with OM Enterprises, a leading tile manufacturer based in Kolkata, India, to purchase a minimum of 5,000 tonnes of material over three years.  As part of the agreement, OM has committed to a US$500,000 advance payment in respect of the first 2,500 tonnes of material to be shipped over the next six months, of which $200,000 has been received to date.

·     In 2017 we entered into a €400,000 sales contract with Simsekler Dogaltas Madencilik A.S, a premier natural stone group in Turkey to supply IIIirico Selene and Sivec marble.  We have shipped over 700 tonnes of material to them to date under this contract. Simsekler owns 9 marble quarries in Turkey as well as 3 factories and 2 showrooms, and warehouses located in Ankara and Istanbul.

·     In August 2017, Fox Marble signed a Memorandum of Understanding with Pristine Stone NYC LLC, a natural stone importer and distributor in the USA, to establish a new distribution outlet for Fox Marble products in the United States.   Under the three-year agreement, Pristine Stone will act as a marketing, sales and distribution agent for the marble material produced by the Company. The marble supplied to Pristine Stone will be cut and polished into slabs and tiles at our own processing factory in Lipjan, Kosovo, before being shipped to the United States.  Pristine Stone's management team has over twenty years' experience in the stone industry including sales, fabrication, and installation.

·     We have been notified that one of the Pisani group companies, Pisani Holdings Ltd, a distributor for Fox Marble, has appointed Deloitte as administrator. Pisani had acted as an agent for Fox Marble`s material.  The group had net unprovided receivables due from Pisani PLC of €68k as at 31 December 2016, which have been provided for in the current period.  We are confident that Fox Marble will continue to supply marble into the property developments at Chelsea Creek and Lillie square, through new arrangements, which we hope to announce in due course.

·     We are holding the balance of a deposit from Eboracum Ltd and Banyan Stone pending further sales, which we expect in due course.

We are continuing to make sales of processed marble slabs to fabricators and developers, including luxury developments in London.   To make it more convenient for our customers we have designed and built a bespoke online block viewing catalogue through which buyers can view and select marble blocks, providing an alternative to in person block selection at the quarry sites.

Revenue from the sale of marble for the six months to 30 June 2017 was €329,607 (2016: €262,000).  Sales in the period from 1 July 2017 to 27 September 2017 were €304,345.  

Fox Marble's order book currently stands at €5.6m of which the Company now expects €2.0m to be recognised within 2017 financial year (Revenues FY 2016: €801,040).   We have reduced the estimate of the amount of our order book we expect to realise in 2017 from €3.4 following the entry of one our distributors into administration, delays in the completion of the factory, and lower than expected production at the Maleshevë.   We expect that the majority of outstanding orders that are not completed in 2017 will be completed in 2018. 

Factory

The Company is pleased to confirm that the factory, sited in Lipjan Kosovo, is now fully operational. The gangsaws, resin line, and polishing line are fully installed, commissioned and operational, and are processing the Company's block marble. The factory is the only one in the Balkans region that includes a resin line - essential to producing slabs and tiles to internationally accepted standards of finish.

The slabs produced have been assessed by experts in the field and are cut to within a 1mm tolerance on thickness, quality comparable to that produced by industry leading processors in Carrara, Italy.

The factory has already cut 8,500 square metres of block marble from its quarries in Kosovo and Macedonia, and is polishing this to fulfill current orders, including supplying Marble Dino SH.pk in Kosovo with processed slabs under the terms of the offtake agreement signed in 2015.

This long-awaited confirmation is a key milestone for the Company and follows its strategy to be a fully integrated volume supplier of dimension stone as processed slab material.

Production at our own factory in Kosovo provides several key benefits to the Company:

·           Reduction in the cost of processing, increasing the margins on the sale of processed slabs and tiles.  Previously, the Company has relied on processing facilities provided by third parties in Italy and Albania.  This involved additional costs for both processing, transport and storage.

·           Access to the local Balkans market where we are the only domestic supplier of slabs and tiles.

·           Entry into the international tile market helped by the lower cost base that the factory will provide.

·           Improvement in quarry yields as we can process more marginal blocks that would not be attractive to our international customers due to shipping and tariff costs.

·           Greater flexibility in responding to our customers' needs as we will no longer have to rely on third party processing.

We have engaged additional specialist sales resource to handle the anticipated increase in the sale of processed marble from Fox Marble.  The Company will announce further orders as they are shipped from the factory to customers both domestically and internationally.

Production update

We have continued to focus production efforts in Kosovo on the Maleshevë quarry, as demand for our Illirico Selene is currently outpacing our level of production.

 We have made good progress on site, and we are currently extracting marble from the fifth bench within the quarry.  The Company has quarried 4,254 tonnes of material in the Maleshevë quarry in the period to 31 August 2017 compared to 990 tonnes in the same period in 2016.  Marble block quality has improved as further deeper benches have opened. 

Due to space constraints on the existing quarry face, we intend to open a second quarry face from the other side of stone mass, which will allow us to increase the rate of block production.  

Alexandrian White

Following a copyright dispute over the rights to use the name "Sivec" for the Company's white dolomitic marble quarried in Macedonia Fox Marble has relaunched its white marble under the trade name Alexandrian White.

Fox Marble's Alexandrian White dolomitic marble comes from its Prilep Alpha quarry in Macedonia.  This is one of a small cluster of quarries, in the Stara river valley at the north-western end of the crescent, overlooked by the Sivec pass which sits upon the Pelagonian marble mass.

Stone from the Pelagonian marble crescent is now extracted by several independent operators, each using its own brand name.  Polaris, Sivec, Veprcani White, Sivec Snow White and our own Alexandrian White are current examples.  But what is striking, regardless of the brand names, is how similar the Pelagonian dolomitic marbles are wherever they are worked.

All Pelagonian dolomitic marble is distinguished by its whiteness and homogeneous crystalline and micro-granular structure. Other common characteristics are the high proportion of magnesium oxide (the defining characteristic of dolomitic marble), limited presence of other minerals, an average pressure resistance of 160MPa and porosity below 1%.  Once processed, it is highly reflective and is an ideal 'cool' marble for use in hot climates.  However, it works equally well in cold climates where its compact and uniform internal structure makes it resistant to ice and extreme cold.

Financing

The Company has issued a further convertible loan note with a value of £440,000 ("Series 3 Loan Note").  This new Series 3 Loan Note has an interest rate of 8%, in line with the Series 1 Loan Note issued to Amati Global Investors Limited.  The Loan Note is due for conversion or repayment on 31 August 2019 with a conversion price set at 10p.  As at 27 September 2017 the Company had convertible loan notes in issue amounting to €1,638,500.

Additionally, Fox Marble has put a draw down facility in place of up to £1m to be called for at its discretion. This credit facility attracts an interest rate of 9% per annum of sums drawn down.

The cash balance as at 30 June 2017 was €929,429 (2016: €2,686,341).  Cash balance as at 24 September 2017 of €296,613.  Facilities available for draw down at 24 September 2017 were €1,008,000.

Outlook

The Board is positive about the outlook for the Company for the remainder of this year and into 2018.  The requirement to convert our order book into sales and cash is of critical importance.   

FOX MARBLE HOLDINGS PLC

Condensed unaudited consolidated income statement and statement of comprehensive income

	Note	Six months ended 30 June 2017 Unaudited €'000s		Six months ended 30 June 2016 Unaudited €'000s			For the year ended 2016 Audited €'000s
Revenue		329		262			801
Cost of Sales		(191)		(176)			(503)
Gross Profit		138		86			298
Administrative and other operational losses		(1,447)		(1,580)			(3,343)
Operating loss		(1,309)		(1,494)			(3,045)
Fair value adjustment		-		187			246
Net finance income/(costs)	4	(118)		117			42
Loss before taxation		(1,427)		(1,190)			(2,756)
Taxation		-		-			-
Loss for the period		(1,427)		(1,190)			(2,756)
Other comprehensive income		-		-			-
Total comprehensive loss for the period attributable to owners of the parent company		(1,427)		(1,190)			(2,756)
Loss per share
Basic loss per share	5	(0.01)		(0.01)			(0.02)
Diluted loss per share	5	(0.01)		(0.01)			(0.02)

FOX MARBLE HOLDINGS PLC

Condensed unaudited consolidated statement of financial position

	Notes	As at 30 June 2017 Unaudited €'000s		As at 31  December 2016 Audited €'000s		As at 30 June 2016 Unaudited €'000s
Assets
Non-current assets
Intangible assets - capitalised mining costs		1,339		1,194		1,230
Property, plant and equipment	6	4,814		4,663		4,117
Receivables		-		-		570
Total non-current assets		6,153		5,856		5,917
Current assets
Trade and other receivables	7	759		1,568		1,360
Inventories		3,337		3,232		3,343
Cash and cash equivalents		930		938		2,687
Total current assets		5,026		5,737		7,390
Total assets		11,179		11,594		13,307
Current liabilities
Trade and other payables		823		890		1,101
Borrowings	8	1,233		1,290
Total current liabilities		2,056		2,180		1,101
Non-current liabilities
Borrowings	8	1,137		-		1,328
Total non-current liabilities		1,137		-		1,328
Total liabilities		3,193		2,180		2,429
Net assets		7,986		9,413		10,878
Equity
Share capital	9	2,281		2,281		2,271
Share premium		26,399		26,399		26,307
Retained loss		(20,813)		(19,386)		(17,819)
Share based payment reserve		83		83		83
Other reserves		36		36		36
Total equity attributable to owners of the parent company		7,986		9,413		10,878

FOX MARBLE HOLDINGS PLC

Condensed consolidated statement of cash flows

	Notes	Six months ended 30 June 2017 Unaudited €'000s		Six months ended 30 June 2016 Unaudited €'000s			Year ended 31 December 2016 Audited €'000s
Cash flows from operating activities
Loss before taxation		(1,427)		(1,190)			(2,756)
Adjustment for:
Net finance  (income)/costs	4	118		(117)			(42)
Fair value adjustment		-		(187)			(246)
Operating loss for the period		(1,309)		(1,495)			(3,045)
Adjustment for:
Amortisation		(146)		33			65
Depreciation	6	174		46			242
Foreign exchange losses / (gains) on operating     Activities		(21)		138			352
Decrease/(increase) in receivables	7	809		(316)			53
Barter transaction		-		-			(251)
Increase in inventories		(105)		(351)			(240)
Increase in accruals		52		57			56
Increase in trade and other payables		(119)		369			160
Net cash used in operating activities		(665)		(1,519)			(2,609)
Cash flow from investing activities
Expenditure on property, plant and equipment	6	(326)		(566)			(1,056)
Deposits paid on property, plant & equipment		-		(113)			(119)
Interests on bank deposits		1		1			3
Net cash outflow from investing activities		(325)		(678)			(1,173)
Cash flows from financing activities
Proceeds from issue of shares (net of costs)		-		2,434			2,525
Proceeds on issue of debt		1,068		-			-
Interest paid		(107)		(207)			(274)
Net cash inflow from financing activities		961		2,227			2,251
Net increase/(decrease) in cash and cash equivalents		(29)		30			(1,531)
Cash and cash equivalents at beginning of   Period		938		2,820			2,820
Exchange gains/(losses) on cash and cash  equivalents		21		(163)			(352)
Cash and cash equivalents at end of period		930		2,687			938

FOX MARBLE HOLDINGS PLC

Condensed consolidated statement of changes in equity

	Share capital €'000s	Share premium €'000s	Share based payment reserve €'000s	Other reserve €'000s	Profit and loss reserve (1) €'000s	Total €'000s
As at 31 December 2015	2,009	24,146	83	36	(16,629)	9,645
Total comprehensive loss for the period	-	-	-	-	(1,190)	(1,190)
Share capital issued	262	2,161	-	-	-	2,423
As at 30 June 2016	2,271	26,307	83	36	(17,819)	10,878
Total comprehensive loss for the period	-	-	-	-	(1,567)	(1,567)
Share capital issued	10	92	-	-	-	102
As at 31 December 2016	2,281	26,399	83	36	(19,386)	9,413
Total comprehensive loss for the period	-	-	-	-	(1,427)	(1,427)
Share capital issued	-	-	-	-	-	-
As at 30 June 2017	2,281	26,399	83	36	(20,813)	7,986

(1)           Brought forward losses at 31 December 2015 includes a charge incurred following the admission of the Company to AIM on the 31 August 2012 when loan notes with a carrying value of €1,508,807 (£1,195,000) were converted into 29,875,000 shares at an issue price of 20 pence per share, with a total value of €7,544,035 (£5,975,000) resulting in a non-cash accounting charge of €6,035,228, reflecting the fair value loss being recognised, in the statement of comprehensive income in the period ended 31 December 2012.

Notes to the condensed consolidated financial statements for the period ended 30 June 2017

1)    General information

The principal activity of Fox Marble Holdings plc and its subsidiary companies Fox Marble Limited, Fox Marble Kosova Sh.p.k, H&P Sh.p.k, Granit Shala Sh.p.k, Rex Marble Sh.p.k, Fox Marble Asia Limited and Stone Alliance LLC (collectively "Fox Marble" or "Group") is the exploitation of quarry reserves in the Republic of Kosovo and South East Europe.

Fox Marble Holdings plc is the Group's ultimate Parent Company ("the Parent Company").  It is incorporated in England and Wales and its registered office is 15 Kings Terrace, London, NW1 0JP.

Fox Marble Holdings plc shares are admitted to trading on the London Stock Exchange's AIM market.

2)    Basis of preparation

The results presented in this report are unaudited and they have been prepared in accordance with the principles of International Financial Reporting Standards ("IFRS") as adopted by the European Union that are expected to be applicable to the financial statements for the year ending 31 December 2017.

The accounting policies applied in these results are consistent with those applied in the Group's Annual Report and Accounts for the year ending 31 December 2016 and those expected to be applicable to the financial statements for the year ending 31 December 2017.

This half yearly report does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006.  Statutory accounts for Fox Marble Holdings plc for the year ended 31 December 2016 were approved by the Board on 6 June 2017 and have been filed with the Registrar of Companies. The report of the auditors on those accounts was unqualified and did not contain a statement under Section 498 (2) or (3) of the Companies Act 2006.  These condensed interim financial statements for the six months ended 30 June 2016 have been prepared in accordance IAS 34, 'Interim financial reporting', as adopted by the European Union. The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2016, which have been prepared in accordance with IFRS as adopted by the European Union.  The Annual Report and Accounts 2016 for the Group are available at www.foxmarble.net.

3)   Going concern

The Directors have reviewed detailed projected cash flow forecasts and are of the opinion that it is appropriate to prepare this report on a going concern basis. In making this assessment management has considered:

a)    the current working capital position and operational requirements;

b)    the timing of expected sales receipts and completion of existing orders;

c)     the sensitivities of forecast sales figures over the next two years;

d)    the timing and magnitude of planned capital expenditure;

e)     the level of indebtedness and timing of when such liabilities may fall due; and

f)     the working capital position over the next 18 months.

The forecasts make a number of operating assumptions around which there are risks and uncertainties.  These include an expected levels of production at the Prilep and Maleshevë quarries, satisfactory operation of the newly commissioned processing factory, and the ability to drawdown on existing debt facilities.  The Company is anticipating significant growth in revenue through the conversion of the existing sale and purchase contracts and signed offtake agreements into delivered sales.  Further the Company is planning to re-finance the fixed rate convertible unsecured Series 1 Loan Note issued on 31 August 2012 to Amati Global Investors of £1,060,000 if it is not converted by the 31 August 2018.

There are a number of key risks and uncertainties that could impact the ability of the Company to operate as a going concern.  These include:

a)    Levels of production at Maleshevë and Prilep can be impacted by unforeseen delays due to inclement weather,  geological features impeding bench progression or equipment failure;

b)    Levels of production at the newly commissioned processing factory which is only recently in operation;

c)     Realisation of the Company's order book could be impacted by issues with production or delays in fulfilment;

d)    Failure to secure appropriate refinancing of the fixed rate convertible unsecured Series 1 Loan Note issued on 31 August 2012 to Amati Global Investors of £1,060,000 if it is not converted by the 31 August 2018;

In the event that the risks identified are realised the Company has available to it a number of other contingent actions are available to the Company, which it can take to mitigate the impact of potential downside scenarios. These include seeking additional financing, leveraging existing sale agreements, reducing overheads, and further renegotiation of the terms of its existing debt obligations.

In conclusion having regard to the existing and future working capital position and projected sales, the Directors are of the opinion that the Group has adequate resources to enable it to undertake its planned activities for the next twelve months.

4)    Net finance income/(costs)

	Six months ended 30 June 2017 €'000s		Six months ended 30 June 2016 €'000s			Year ended 31 December 2016 €'000
Interest expense on convertible loan notes	(51)		(98)			(148)
Movement in fair value of derivative	(51)		28			(45)
Foreign exchange gain	37		186			245
Interest income of bank deposits	1		1			3
Other interest expense	(54)		-			(13)
	(118)		117			42

5)    Loss per share

	Six months ended 30 June 2017 €'000s		Six months ended 30 June 2016 €'000s			Year ended 31 December 2016 €'000
Loss for the year used for the calculation of basic LPS	1,427		1,190			2,756
Number of shares
Weighted average number of ordinary shares for the purpose of basic LPS	181,067,024		162,739,835			171,797,179
Effect of potentially dilutive ordinary shares	-		-			-
Weighted average number of ordinary shares for the purpose of diluted LPS	181,067,024		162,739,835			171,797,179
Loss per share:
Basic	(0.01)		(0.01)			(0.02)
Diluted	(0.01)		(0.01)			(0.02)

6)    Property, plant and equipment

	Land €'000s	Construction in progress €'000	Plant and machinery €'000s	Office equipment and leasehold improvements €'000s	Total €'000s
Cost
As at 31 December 2015	160	1,772	2,456	28	4,416
Additions	-	359	206	1	566
As at 30 June 2016	160	2,131	2,662	29	4,982
Additions	-	656	85	1	742
As at 31 December 2016	160	2,787	2,747	30	5,723
Additions	-	218	107	-	325
As at 30 June 2017	160	3,005	2,853	30	6,048
Depreciation
As at 31 December 2015	-	-	801	18	819
Charge for the period	-	-	43	3	46
As at 30 June 2016	-	-	844	21	865
Charge for the period	-	-	194	2	196
As at 31 December 2016	-	-	1,038	23	1,061
Charge for the period	-	-	172	2	174
As at 30 June 2017	-	-	1,209	25	1,234
Net book value
As at 30 June 2017	160	3,005	1,644	5	4,814
As at 31 December 2016	160	2,787	1,709	7	4,663
As at 30 June 2015	160	2,131	1,818	8	4,117

7)    Trade and other receivables

	30 June 2017 €'000s		31 December 2016 €'000s		30 June 2016 €'000s
Non-current assets
VAT recoverable	-		-		570
Other receivables	-		-		60
	-		-		630
Current assets
Trade receivables	70		147		132
Deposits on capital equipment	269		284		403
Other receivables	197		363		38
Prepayments	133		118		132
VAT recoverable	90		657		25
	759		1,568		730

8)    Borrowings

	30 June 2017 €'000s		31 December 2016 €'000s		30 June 2016 €'000s
Current liabilities
Convertible loan note	1,196		1,219		-
Derivative over own equity at fair value	37		71		-
	1,233		1,290		-
Non-Current liabilities
Convertible loan note	483		-		1,328
Other borrowings	568		-		-
Derivative over own equity at fair value	86		-		-
	1,137		-		1,328

On 31 August 2012, the Company issued a €1,295,278 (£1,060,000) fixed rate convertible unsecured loan note 2017 to Amati Global Investors Limited ("Series 1 Loan Note").

Interest accrues on the Series 1 Loan Note at 8% per annum.  At any time prior to repayment of the Series 1 Loan Note, a Stockholder may issue a conversion notice. On 1 June 2016 the conversion formula was amended to 1 Ordinary Share for every 10 pence of nominal stock converted.  If the Series 1 Loan Note is not converted at the Stockholders request it must be repaid in full on the 5^th anniversary of the instrument date.

On 5 June 2017, the Company was granted an option to extend the €1,295,278 (£1,060,000) fixed rate convertible unsecured loan note 2017 with Amati Global Investors by one year in return for a reduction in conversion price from 10p to the lower of 9p or a 15% discount to the volume weighted average price for the 10 business days trading prior to a conversion notice being served. 

As at 30 June 2017, the loan note held at amortised cost had a balance of €1,196,403 (31 December 2016 - €1,219,471).

On 10 February 2017, the Company entered into a short term finance arrangement with Peers Hardy (UK) Limited for £500,000 repayable on the 10 August 2017 at an interest rate of 15%.  The term of the facility may be increased at the Company's request to 31 October 2018.

On 2 June 2017 the Company entered into a facility arrangement with Brandon Hill Capital Limited, which may be drawn down at the Company's request. As at 30 June 2017 no amounts had been drawn down.

On 28 June 2017 the Company issued a new convertible loan note with a value of £440,000 ("Series 3 Loan Note") to a non related party.  This new Series 3 Loan Note has an interest rate of 8% per annum, in line with the Series 1 Loan Note issued to Amati Global Investors Limited.  The Loan Note is due for conversion or repayment on 31 August 2019 with a conversion price set at 10p.

9)    Share capital

	30 June 2017 Number	31 December 2016 Number	30 June 2017 €'000s	31 December 2016 €'000s
Issued, called up and fully paid:
Ordinary shares of 1 pence each	181,067,024	181,067,024	2,281	2,281

10)  Events after the reporting period

On 12 July 2017, Fox Marble issued 277,777 new ordinary shares of 1p each ("Ordinary Shares") in the Company to Beaufort Securities Limited at a deemed price of 9p per share, being the closing bid price on 11 July 2017, in lieu of cash payment for annual broking fees.

On the same date the Company granted warrants to Beaufort Securities Limited (subject to the mid-price of the ordinary shares trading above the exercise price for a consecutive period of more than 3 months), as follows: 100,000 warrants exercisable at 15p per share, 75,000 warrants exercisable at 20p per share.  These warrants may be exercised for a period of up to 3 years from their date of issue.

 

END

 

 

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