Interim Results

RNS Number : 6315K

Silvermere Energy PLC

31 July 2013

 

31 July 2013

Silvermere Energy plc

("Silvermere" or the "Company")

Unaudited Interim Results for the Six Months ended 30 June 2013

Silvermere, the independent oil and gas company focusing principally on exploration, appraisal and production opportunities in the US, today announces its interim results for the six months ended 30 June 2013.

The Company's various announcements during 2013 have identified the reasons why the steady progress made through 2012 unfortunately stalled in 2013.  Although the I-1 Well began to produce in February and March 2013, technical difficulties subsequently resulted in suspension of production. Additional expenditure on remedial works is required in order to attempt to recommence production.  The fall in US gas prices as domestic supply of natural gas from fracking increases has also impacted the financial viability of the business.

Silvermere has more recently been unable to pay its share of the I-1 Well's development costs or to raise new finance, since the placing in January 2013, in which a placee failed to honour his commitment for £80,000.  The technical difficulties and halted production at the I-1 Well have also impacted the Company's share price and commercial prospects and the Board has therefore been unable to follow its strategy of acquiring other producing assets.

Following the announcement on 9 May 2013 when the Directors requested trading in the Company's shares to be suspended on the AIM market, they have endeavoured to find the best solution for shareholders and creditors.

Working alongside the Company's major creditor, Mineral and Financial Investments Ltd ("MAFI"), the Board has ultimately determined that the best way forward would be to dispose of all or part of the Mustang Island asset to the operator in consideration for a release from past and future obligations and to turn the Company into a clean shell through a CVA.  A number of parties expressed interest in financing a CVA and investing in the resulting shell and on 9 July 2013 the Company signed Heads of Terms and entered into exclusive discussions with a consortium of investors.

The Board is disappointed by this outcome.  We trust shareholders will accept that the Board has played its hand as professionally as possible. We would like to thank the Board of MAFI, our major creditor, for its commitment to finding a solution and we wish the incoming Board good fortune in creating value for all shareholders.

 Frank H. Moxon

Non-executive Chairman

For further information please contact: Silvermere Energy plc Andy Morrison, Chief Executive	[phone]
Sanlam Securities UK Limited (Nominated Adviser and Broker) Simon Clements / Virginia Bull / Catherine Miles Peterhouse Corporate Finance Limited Heena Karani/ Duncan Vasey	+ 44(0)20 7628 2200  [phone]
Bishopgate Communications Nick Rome/ Anna Michniewicz/ Ivana Petkova	[phone]

Unaudited Group Statement of Comprehensive Income

for the 6 months ended 30 June 2013

						6 months to 30 June 2013		6 months to 30 June 2012		12 months to 31 December 2012
						(Unaudited)		(Unaudited)		(Audited)
						£		£		£
Administration costs						(401,975)		(585,164)		(994,871)
Exceptional items						-		-		(3,850,000)
Operating loss						(401,975)		(585,164)		(4,844,871)
Financial income						-		13		-
Finance costs						(122,503)		(86,947)		(190,147)
Loss before tax						(524,478)		(672,098)		(5,035,018)
Income tax						-		-		-
Loss for the period						(524,478)		(672,098)		(5,035,018)
Loss per share
Basic						(1.6p)		(3.2p)		(20.0p)
Diluted						(1.6p)		(3.2p)		(20.0p)

Unaudited Group Statement of Financial Position

as at 30 June 2013

			30 June  2013		30 June  2012		31 December 2012
			(Unaudited)		(Unaudited)		(Audited)
		Note	£		£		£
Assets
Investment in oil and natural gas assets			320,594		3,804,929		247,865
Non-current assets			320,594		3,804,929		247,865
Current assets
Trade and other receivables			30,350		289,508		84,640
Cash and cash equivalents			17,973		703,668		19,248
			48,323		993,176		103,888
Total assets			368,917		4,798,106		351,753
Equity attributable to the Company's equity holders
Share capital		4	1,301,913		1,296,547		1,296,607
Share premium			6,347,374		5,923,905		6,004,030
Loan note equity reserve			25,274		25,274		25,274
Share option and warrant reserve			795,699		795,689		795,699
Retained earnings			(9,556,010)		(4,688,612)		(8,081,532)
			(1,085,750)		3,436,988		(909,922)
Current liabilities
Trade and other payables			1,365,215		747,368		1,175,399
Non-current liabilities
Borrowings			31,608		555,906		28,432
Decommissioning obligation			57,844		57,844		57,844
Total liabilities			1,454,667		1,361,118		1,261,675
Total equity and liabilities			368,917		4,798,106		351,753

Unaudited Group Statement of Cash flows

for the 6 months ended 30 June 2013

		6 months to 30 June 2013		6 months to 30 June 2012		12 months to 31 December 2012
		(Unaudited)		(Unaudited)		(Audited)
	Note	£		£		£
Cash flows from operating activities
Cash used in operations	5	(149,438)		191,663		(290,634)
Net cash from operating activities		(149,438)		191,663		(290,634)
Cash flows from investing activities
Investment in oil and gas assets		(120,487)		(440,350)		(537,510)
Net cash from investing activities		(120,487)		(440,350)		(3,248,127)
Cash flows from financing activities
Proceeds on issue of shares		291,400		759,990		645,040
Share issue expenses		(22,750)		(10,000)		-
Finance income		-		13		-
Net cash from financing activities		268,650		750,003		645,040
Increase in cash and cash equivalents		(1,275)		501,316		(183,804)
Cash and cash equivalents at beginning of period		19,248		202,352		202,352
Cash and cash equivalents at end of period		17,973		703,668		19,248

Notes to the unaudited interim statement

for the 6 months ended 30 June 2013

1.       General information

Silvermere Energy Plc is an investor in oil and gas assets.

The Company is a public limited company listed on AIM and is incorporated in England and Wales.

The address of its registered office is 31 Harley Street, London, W1G 9QS. Items included in the financial statements of the Company are measured in Pound Sterling which is the currency of the primary economic environment in which the entity operates. The financial statements are also presented in Pound Sterling which is the Company's presentational currency.

2.       Basis of preparation

The interim financial statements of Silvermere Energy Plc have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and on the historical cost basis using the accounting policies which are consistent with those set out in the Company's Annual Report and Accounts for the year ended 31 December 2012.

This interim financial information for the six months to 30 June 2013 was approved by the board on 29 July 2013.

The unaudited interim financial information for the period ended 30 June 2013 does not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The comparative figures for the year ended 31 December 2012 are extracted from the audited statutory financial statements for that period.

3.       Loss per share

Loss per share is calculated by reference to the weighted average of 33,870,865 ordinary shares in issue during the period (30 June 2012 - 20,926,393 and 31 December 2012 - 25,117,597).

The diluted loss per share is the same as the basic loss per share as the losses in each period have an anti-dilutive effect.

4.       Share capital

	30 June 2013		30 June 2012		31 December 2012
	Number		Number		Number
Issued and fully paid:
Ordinary shares of £0.001	34,545,072		29,179,310		29,239,356
Deferred shares of £29.999	42,247		42,247		42,247
	£		£		£
Issued and fully paid:
Ordinary shares of £0.001	34,545		29,179		29,239
Deferred shares of £29.999	1,267,368		1,267,368		1,267,368
	1,301,913		1,296,547		1,296,607

The deferred shares have negligible value, being subject to restrictions as to voting, participation and redemption according to the new Articles of Association then adopted, nor are they quoted on the Stock Exchange.

On 23 January 2013, 5,305,716 shares were issued for cash at 7p per share as a result of a private placing.

5.       Note to the cash flow statement

	6 months to 30 June 2013		6 months to 30 Jun 2012		12 months to 31 Dec 2012
	(Unaudited)		(Unaudited)		(Audited)
	£		£		£
Loss for the period	(524,478)		(672,098)		(5,035,018)
Adjustments for items not included in cash flow:
Share-based payment expense	-		20,600		20,610
Shares issued in lieu of fees and remuneration	-		3,000		123,950
Finance expense	122,503		86,947		190,147
Impairment expense	-		-		3,850,000
Provision for unpaid share capital	80,000		-		-
Finance income	-		(13)		-
	(321,975)		(476,564)		(850,311)
Adjustments for changes in working capital:
- Decrease in trade and other receivables	54,290		163,204		368,072
- Increase) in trade and other payables	118,247		590,023		191,605
Cash generated from/(used in) operations	(149,438)		191,663		(290,634)

6.         Availability of Interim results

Copies of the report will be available from the Company's office and also from the Company's website www.silvermere-energy.com.

 

END

 

 

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