Preliminary Results

TomCo Energy PLC 01 April 2008 The following replaces the Preliminary Results announcement released at 08:00 yesterday under RNS number 1121R. The full amended release appears below. TOMCO ENERGY PLC ('TomCo' or 'the Company') PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2007 TomCo (TOM.L), the oil mining and production company, today announces its Preliminary Results for the year ended 30 September 2007. HIGHLIGHTS • Successful launch of TomCo Energy Plc on AIM following completion of the acquisition of The Oil Mining Company Inc in January 2007 which owns oil shale leases covering 2,918 acres in Utah, estimated by SRK Consulting ('SRK') to contain some 230 million barrels of oil • Raised £1.77 million in new equity for investment in conventional oil assets • During the year, acquired interest in seven drilling participations and acquired rights to participate in 17 new drilling prospects in US • Gross production averaging 11.46 barrels per day from PDP's Stephen Komlosy, Chairman of TomCo, commented: 'The period under review covers a period during which the Company has been transformed: the Board's strategy, that of holding the oil shale assets until commercial production is economical, whilst pursuing exposure to conventional, low cost oil & gas production, is being fulfilled. The Board continues to actively seek further investments, acquisitions and oil business associations.' Shareholders may be interested to view the Company's web site, www.tomcoenergy.com which contains a summary of our current strategy of participation in oil producing wells and prospects and contains detailed information about US oil shale and related interesting links to US Government sites, the Company's share price (twenty minute delay) together with press articles and Company announcements as they are made. For further information, please contact: TomCo Energy Plc Stephen Komlosy Tel: (020) 7808 4857 Strand Partners Limited Simon Raggett Tel: (020) 7409 3494 Warren Pearce Bankside Consultants Tel: (020) 7367 8888 Simon Rothschild Louise Mason TomCo Energy Plc PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2007 CHAIRMAN's STATEMENT I am pleased to announce the results for TomCo Energy Plc ('TomCo or the Company') (formerly Netcentric Systems Plc) for the year ended 30th September 2007. These financial results reflect the fundamental change by the Company into an active oil production and exploration company. Acquisition of The Oil Mining Company Inc On 16 January 2007, Netcentric Systems Plc completed the reverse acquisition of The Oil Mining Company Inc, which owns two separate groups of mineral leases on a total of 2,918 acres of oil shale in the State of Utah, US. The independent firm of mining consultants, SRK, reporting on the acquired leases, has estimated these leased oil shale areas to contain some 230 million barrels of oil. At completion of the acquisition, the Company changed its name to TomCo Energy Plc and was re-admitted to trading on AIM (TOM.L) and John Ryan, the President of The Oil Mining Company Inc, was appointed to the Board as Commercial Director. In conjunction with the acquisition, the Company raised a total of £1.78 million through a placing of 71.28 million ordinary shares, at a placing price of 2.5 pence each, which has been used for working capital and primarily to enable the Company to investigate and make investments in producing oil wells and drilling in proven undeveloped acreage in the US. Investments During the year, the Company took interests in five drilling participations two of which were successful and one of which has not yet started drilling. The Company also acquired for US$972,000, a 50% interest in the Mark III leases, 'Saratoga and Abel' in Lubbock County, Texas, which have eight producing wells and preliminary estimated reserves of 28,960 barrels and subsequent to the year end has announced a six well 'in-fill' drilling programme at these two leases with a further eleven projected to be drilled later during 2008. We also spent a significant amount of time and effort to research and bring forward the acquisition programme for two sizeable target companies, which, unfortunately, failed to pass the due diligence tests which are a vital aspect of our decision making process. We will continue to be vigilant about all acquisition ideas and the process has enhanced our contacts and in turn our access to a larger number of high class prospects. We continue to research a number of other acquisition targets. Post Balance Sheet Acquisition of Heletz-Kokhav and Luxi Licenses, Israel On 16 January 2008 TomCo announced that it had signed a Letter of Intent ('LOI') regarding the acquisition ('Acquisition') of interests in two petroleum licenses onshore Israel from Avenue Group Inc (AVNU.OB), a New York based US listed Oil & Gas Company, and its wholly-owned subsidiary Avenue Energy Israel Limited (together referred to as 'AEI'). The interests to be acquired are a 50% interest in the Heletz -Kokhav Licence and a 25% interest in the Luxi License (the 'Licenses'), which include the Heletz- Kokhav oilfield ('Heletz'). The concessions, covering over 68,000 gross acres, were recently awarded to AEI by the Israel Petroleum Commission and are 3-year production and development licenses which can be extended to 30-year production leases once production from the field has increased from the recent 60 to 300 barrels of oil per day ('bopd'). The Heletz field, located 55km south of Tel Aviv and 12km east of the Mediterranean coast, is Israel's only onshore producing oil field. The field has produced in excess of 17 million barrels of oil to date from Cretaceous sands, with peak production of 3,000 to 4,200 bpd between 1959 and 1967.The original oil-in-place (OOIP) for the field is estimated to be 50.7 million barrels; the Israeli Government estimates that there are 2 million barrels of primary recoverable oil remaining, and studies suggest over 5 million barrels of secondary recovery potential may exist. A number of undrilled, deeper exploration prospects on the licenses have estimated potential in excess of 100 million barrels. AEI and the Company will commission an independent determination of remaining reserves for the Heletz field as one of the first steps in an active technical programme designed to identify well re-completion and infill well drilling targets, and to examine secondary recovery options. Production from the field had declined to around 60 bpd by 2007, although TomCo expects that the implementation of modern production and recovery methods and selected infill drilling will significantly increase production over the next 2 years, resulting in the granting of a 30-year production lease. The completion terms of the Acquisition will be: 1. TomCo will place into escrow US$1 million in cash for a period of three months pending the approval of the transfer from Avenue of the 50% and 25% interests in the oil fields to TomCo by the Israeli Authorities with a formula to complete the transfer in the event that no such approval is forthcoming; 2. TomCo will issue to AEI 12.5 million ordinary shares of 0.5 pence each in the Company ('TomCo Shares') valued at US$500,000 at 4c per share with a one year sale restriction; 3. TomCo will pay to AEI 50% of AEI costs incurred to date in relation to the Licenses of TomCo of US$54,000; 4. over the three year Phase 1 period (three years) of the License TomCo will pay up to a maximum US$4.5 million of development costs; 5. TomCo will pay a further US$1.5 million fee to AEI at the time at which a 30 years production lease is issued, which is expected to be at the time production at the fields reaches 300 bpd; and 6. TomCo will pay a further US$5 million fee to AEI in the event that gross recoverable reserves on the Licenses are declared by an independent, qualified assessor to be more than 10 million barrels. To finance the Acquisition, TomCo has placed 67,066,666 shares ('Placing Shares') at 1.5p per share raising a total of £1million before expenses. Each two shares placed has an attached warrant to subscribe for one new ordinary TomCo share at a strike price of 2.5p per share with a 13 months term and a further Warrant for one share at a strike price of 5p exercisable within 13 months of the date of exercise of the first warrant. Application has been made for the Placing Shares to be admitted to AIM, and trading is expected to commence on 25 March. Additionally at completion of the Heletz Acquisition on the Company intends to issue a 24 months 8% Convertible Loan Note to Trafalgar Capital Specialized Investment Fund for Euros 1,000,000 with a minimum convertibility at 2p per share. The Company will issue 7,000,000 warrants with a three years term with an exercise price calculated at 90% of the price at completion and fee of Euro 25,000 satisfied by an issue of 1,179,562 shares. Shareholders should be aware that this acquisition of the Heletz-Kokhav and Luxi licences has not yet completed and the Company will make appropriate announcements regarding this transaction. Strategy The Company's strategy going forward is to hold the oil shale assets in reserve until such time as their exploitation becomes commercially and economically practical. In this regard, we believe that the Shell 'In Situ' extraction process is the most likely to receive environmental clearance from US authorities and start meaningful production within a six-year time frame. Secondly the Company is utilising the expertise of Howard Crosby, our CEO, and John Ryan, in investment in oil wells and proven undeveloped acreage located in the US and in special situations like the Heletz License in Israel. This strategy is being implemented and the Company has, to date, already invested US$1.39 million in such situations with a view to creating a prodigious and productive investment portfolio of conventional American and Israeli based shallow producing oil wells and proven undeveloped drilling locations. Meanwhile the Board continues to actively seek further investments, acquisitions and oil business associations. Oil Shale Although there have been recent ongoing advances in the technology to extract oil from oil shale, particularly by Shell Oil, oil shale in the US is not yet being commercially exploited on any scale, but your Board believes that this situation will change over the next few years (as a result of the huge strategic and commercial pressures, together with present supply anxiety) which will within this time frame, induce the US to create an oil shale industry in the way that the Canadian Tar Sands industry was created; indeed there has been a flurry of oil shale deals in January 2008 in the US, including an acquisition by IDT and apparent oil shale land purchases by Shell Oil. Future Investment Your Board is now also reviewing certain other investments where clear advantage can be shown to exist to assist in the improving the value of our shares. Web Site Shareholders can find detailed information on the Company's web site; www.tomcoenergy.com which, in accordance with AIM Rule 26, contains a summary of our current strategy, detailed information about US oil shale and oil shale related links to US Government sites, the Company's share price, documents, announcements, press releases and articles. Stephen Komlosy Chairman 31 March 2008 Consolidated income statement For the financial year ended 30 September 2007 2007 2006 £'000 £'000 Revenue 68 - Cost of sales (36) - -------- -------- Gross profit 32 - -------- -------- Administrative expenses (1,274) (131) -------- -------- Operating loss (1,242) (131) Financial income 30 4 -------- -------- Loss before taxation (1,212) (127) Taxation - - -------- -------- Loss for the year attributable to equity (1,212) (127) shareholders -------- -------- Earnings per share 2007 2006 Pence per Pence per share share Loss per share (0.34) (0.09) Fully diluted loss per share (0.34) (0.09) All amounts derive wholly from continuing activities. The financial information above may not be representative of future results The Company has elected to take exemption under the Companies Act 1931- 2004 to not present the parent Company's Income statement. The loss for the parent Company for the year was £549,302 (2006: £127,443) Balance sheets As at 30 September 2007 Group Company Group Company 2007 2007 2006 2006 £'000 £'000 £'000 £'000 ASSETS Non current assets Property, plant and equipment 6 6 2 2 Oil properties 5,892 - - - Investment in subsidiaries - 5,572 - - Available for sale financial assets 49 49 94 94 -------- -------- -------- -------- 5,947 5,627 96 96 -------- -------- -------- -------- Current assets Trade and other receivables 54 1,118 86 86 Cash and cash equivalents 136 101 83 83 -------- -------- -------- -------- 190 1,219 169 169 -------- -------- -------- -------- LIABILITIES Current liabilities Trade and other payables (93) (115) (47) (47) -------- -------- -------- -------- (93) (115) (47) (47) -------- -------- -------- -------- Net current assets 97 1,104 122 122 -------- -------- -------- -------- Net assets 6,044 6,731 218 218 ======== ======== ======== ======== SHAREHOLDERS' EQUITY Share capital 2,217 2,217 832 832 Share premium 5,593 5,593 188 188 Warrant reserve 272 272 - - Retained earnings (2,038) (1,351) (802) (802) -------- -------- -------- -------- Total equity 6,044 6,731 218 218 ======== ======== ======== ======== Stephen A Komlosy John J May Chairman Finance Director Consolidated statement of changes in equity For the financial year ended 30 September 2007 Share Share Warrant Retained capital premium reserve earnings Total £'000 £'000 £'000 £'000 £'000 Balance at 1 October 2006 832 188 - (802) 218 Recognition of Share-based payments - - 272 - 272 Loss for year - - - (1,212) (1,212) Issue of share capital 1,385 5,405 - - 6,790 Exchange - - - (24) (24) -------- -------- -------- -------- -------- At 30 September 2007 2,217 5,593 272 (2,038) 6,044 ======== ======== ======== ======== ======== Consolidated statement of recognised income and expense For the financial year ended 30 September 2007 2007 2006 £'000 £'000 Currency translation differences (24) - -------- -------- Net losses recognised directly in equity (24) - Loss for the financial period (1,212) (127) -------- -------- Total recognised expense for the year (1,236) (127) -------- -------- Attributable to the equity shareholders of the Company (1,236) (127) Consolidated cash flow statements For the financial year ended 30 September 2007 Group Company 2007 2006 £'000 £'000 Cash flows from operating activities Cash generated from operations (540) (99) -------- -------- Net cash used in operating activities (540) (99) -------- -------- Cash flows from investing activities Purchase of equipment (5) (2) Purchase of oil leases (703) - Purchase of available for sale financial assets (49) (94) Finance income 30 4 -------- -------- Net cash used in investing activities (727) (92) -------- -------- Cash flows from financing activities Net proceeds from issue of share capital 1,320 271 -------- -------- Net increase in cash and cash equivalents 53 80 Cash and cash equivalents at beginning of financial 83 3 period -------- -------- Cash and cash equivalents at end of financial 136 83 period ======== ======== NOTES 1. The figures set out above are derived from the audited accounts of TomCo Energy Plc for the year ended 30 September 2007. The 2007 accounts will be sent to shareholders shortly. The Annual General Meeting will be held at 5pm on 16 June 2008 at 26 Mount Row, London W1K 3SQ. 2. The Company's financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations adopted by the European Union (EU) and with those parts of the Companies Act 1931 to 2004 applicable to companies reporting under IFRS. 3. The financial information set out above does not constitute the Company's statutory accounts for the years ended 30 September 2007 or 2006 within the meaning of section 6 and Schedule 1 of the Isle of Man Companies Act 1982 but is derived from those accounts. Statutory accounts for 2006 have been delivered to the registrar of companies, and those for 2007 will be delivered in due course. The auditors have reported on those accounts; their report was (i) unqualified (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 15 (4) (a) or (6) of the Isle of Man Companies Act 1982. 4. Segmental reporting Analysis by geographical segment The whole of the Group's revenue arises within the United States. The loss before taxation arises within the United Kingdom and the United States. Net assets are in the United Kingdom and the United States. United United United States Kingdom Total Kingdom Year ended 30 September 2007 2007 2007 2006 £'000 £'000 £'000 £'000 Continuing activities Revenue 68 - 68 - Cost of sales (36) - (36) - -------- -------- -------- -------- Gross profit 32 - 32 - -------- -------- -------- -------- Administrative expenses (708) (566) (1,274) (131) -------- -------- -------- -------- Operating loss (676) (566) (1,242) (131) Financial income - 30 30 4 -------- -------- -------- -------- Loss for the year (676) (536) (1,212) (127) ======== ======== ======== ======== Financial assets - Property, plant and equipment - 6 6 2 - Oil properties 5,892 - 5,892 - - Available for sale financial assets 49 - 49 94 Trade and other receivables 15 39 54 86 Cash and cash equivalents 13 123 136 83 -------- -------- -------- -------- Total assets 5,969 168 6,137 265 -------- -------- -------- -------- Financial liabilities Trade and other payables - (93) (93) - -------- -------- -------- -------- Total liabilities - (93) (93) - -------- -------- -------- -------- Analysis by business segment Based on an analysis of risks and returns, the Directors consider that the Group has two main identifiable business segments; oil production and investing activities. The Directors consider that no further segmentation is appropriate. Oil production Investing Central activities activities costs Total Year ended 30 September 2007 £'000 £'000 £'000 £'000 Continuing activities Revenue 68 - - 68 Cost of sales (36) - - (36) -------- -------- -------- -------- Gross profit 32 - - 32 -------- -------- -------- -------- Administrative expenses (708) - (566) (1,274) -------- -------- -------- -------- Operating loss (676) - (566) (1,242) Financial income - - 30 30 -------- -------- -------- -------- Loss for the year (676) - (536) (1,212) ======== ======== ======== ======== Financial assets - Property, plant and equipment - - 6 6 - Oil properties 5,892 - - 5,892 - Available for sale financial assets - 49 - 49 Trade and other receivables 15 - 39 54 Cash and cash equivalents 13 - 123 136 -------- -------- -------- -------- Total assets 5,920 49 168 6,137 -------- -------- -------- -------- Financial liabilities Trade and other payables - - (93) (93) -------- -------- -------- -------- Total liabilities - - (93) (93) -------- -------- -------- -------- Oil production Investing Central activities activities costs Total Year ended 30 September 2006 £'000 £'000 £'000 £'000 Continuing activities Revenue - - - - Administrative expenses - - (131) (131) -------- -------- -------- -------- Operating loss - - (131) (131) Financial income - - 4 4 -------- -------- -------- -------- Loss for the year - - (127) (127) ======== ======== ======== ======== Financial assets - Property, plant and equipment - - 2 2 - Available for sale financial assets - 94 - 94 Trade and other receivables - - 86 86 Cash and cash equivalents - - 83 83 -------- -------- -------- -------- Total assets - 94 171 265 -------- -------- -------- -------- Financial liabilities Trade and other payables - - (47) (47) -------- -------- -------- -------- Total liabilities - - (47) (47) -------- -------- -------- -------- 5. Earnings per share Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of Ordinary shares outstanding during the year. For diluted earnings per share, the weighted average number of Ordinary shares in issue is adjusted to assume conversion of all dilutive potential Ordinary shares. Share warrants do not have a dilutive effect. Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below. Weighted average number of Per-share Financial year ended 30 September 2007 Earnings shares amount £'000 £'000 pence Basic EPS Earnings attributable to Ordinary shareholders (1,212) 359,746 (0.34) Effect of dilutive securities - - - -------- -------- -------- Diluted EPS Adjusted earnings (1,212) 359,746 (0.34) -------- -------- -------- Weighted average number of Per-share Financial year ended 30 September 2006 Earnings shares amount £'000 £'000 pence Basic EPS Earnings attributable to Ordinary shareholders (127) 149,227 (0.09) Effect of dilutive securities - - - -------- -------- -------- Diluted EPS Adjusted earnings (127) 149,227 (0.09) -------- -------- -------- This information is provided by RNS The company news service from the London Stock Exchange K

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