Half Yearly Report

RNS Number : 8865I

Westmount Energy Limited

31 March 2015

 



Westmount Energy Limited ("Westmount" or the "Company") Interim Results   The Company is pleased to announce its Interim Results for the period ended 31 December 2014. A copy of the results is available on the Company's website, www.westmountenergy.com, and will be posted to shareholders. CHAIRMAN'S REVIEW When I last reported to you, I referred to the ongoing review of various corporate and transaction opportunities. The uncertainty generated by the rapid fall in the oil price resulted in a number of proposals and discussions regarding possible transactions to be being terminated or put on hold. In light of the new oil price environment, I have renewed efforts to assess opportunities to create value for shareholders. As previously stated, should a value enhancing proposal materialise, Westmount shareholders should be afforded the opportunity to participate. The past six months has seen an acute adjustment in the oil price. The price move was prompted by OPEC's decision last November to leave production quotas unchanged and OPEC's desire to maintain market share. At the time there was an excess supply of approximately 2 million barrels per day in world oil production; however the 60% price fall in light of an effective 2% excess daily supply may be overdone in the longer term.  There have been a number of unintended consequences as a result of the rapid pace of the oil price fall, with many smaller OPEC members hurting financially. So the next OPEC meeting together with geo-political events should be closely watched and could further impact on the commodity price. As oil & gas exploration & production companies adjust to the new price environment, their share prices have reacted negatively to the lower oil price outlook as well as each company's particular challenges. These challenges include, asset valuation write downs, reduced cash flow, unprofitable production, unsustainable debt levels, lack of exploration capital and tougher farm out market. Some companies face a combination of all of the above and may fail. For others with capital and proven management teams there should be opportunities. While Westmount's portfolio has suffered from exposure to falling share prices of some holdings in the portfolio, fortunately, Westmount's largest investment holding, Falklands Oil & Gas Limited, has the following positive attributes: ·      Exposure to up to 5 exploration wells in both the North and South Falklands Island basins, most of which are carried by third parties, ·      Targeting 1.4 billion barrels of gross prospective resources, ·      Cash of c.US$100m at 31 December 2014, and no debt, ·      Interest of at least 40% in each licence ensures their shareholders will have substantial equity exposure to these resources in the case of success. On March 6th Falkland Oil and Gas Limited made an announcement on the commencement of their 2015 drilling programme, which is available for you to view: http://www.fogl.com/fogl/en/Media/pressreleases?id=168. The Falkland Oil & Gas Limited share price has recovered recently reflecting the above fundamentals.  I remain hopeful that our investment exposure to the Falklands could recover shareholder value over the current drilling campaign. As mentioned above, other holdings in the portfolio have underperformed relative to FOGL. During the period under review the board agreed to dispose of 200,000 shares in Sterling Energy PLC to raise £50,582 for general and corporate overheads. Westmount still retains 300,000 shares in Sterling Energy PLC. Finally, Mr Peter Richardson, a long serving director, recently resigned from the board. I wish to thank him for his support and contribution to Westmount and wish him well for the future. Gerard Walsh Chairman 31 March 2015

Enquiries:-

David King

Westmount Energy Limited                            Tel: [phone]

Nicholas Wells/Elizabeth Bowman

Nomad and Broker

Cenkos Securities plc                                      Tel: [phone]

www.cenkos.com

CONDENSED STATEMENT OF COMPREHENSIVE INCOME

FOR THE PERIOD ENDED 31 DECEMBER 2014

					Six months ended			Six months ended			Year ended
					31 Dec 2014			31-Dec-13			30-Jun-14
					(unaudited)			(unaudited)			(audited)
					£			£			£
Income statement
Net (loss) / gain on financial assets held at fair value through profit or loss
					(30,685)			88,305			(63,287)
Administration expenses					(59,659)			(69,873)			(142,319)
Operating loss					(90,344)			18,432			(205,606)
Loss before tax					(90,344)			18,432			(205,606)
Tax					-			-			-
Comprehensive loss for the period					(90,344)			18,432			(205,606)
Basic (loss) / gain per share (pence)					(0.92)			0.19			(2.10)
Diluted gain / (loss) per share					(0.92)			0.19			(2.10)

All results are derived from continuing operations.

The Company had no items of other comprehensive income during the period.

CONDENSED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2014

					31 Dec 2014			31-Dec-13			30-Jun-14
					(unaudited)			(unaudited)			(audited)
					£			£			£
ASSETS
Non current assets
	Financial assets at fair value through profit or loss				601,621			834,480			682,888
Current assets
	Other receivables				1,522			4,962			7,607
	Cash and cash equivalents				69,326			154,843			76,866
					70,848			159,805			84,473
Total assets					672,469			994,285			767,361
LIABILITIES AND EQUITY
Current liabilities
	Trade and other payables				53,283			85,392			57,831
EQUITY
	Share Capital				1,966,060			1,966,060			1,966,060
	Share Premium Account				516,777			492,103			516,778
	Share Option Account				293,427			293,427			293,427
	Retained earnings				(2,157,078)			(1,842,697)			(2,066,735)
Total  equity					619,186			908,893			709,530
Total liabilities and equity					672,469			994,285			767,361

CONDENSED STATEMENT OF CHANGES IN EQUITY

FOR THE PERIOD ENDED 31 DECEMBER 2014

	Share capital				Share premium				Share option			Retained
	Account				Account				Account			Earnings			Total equity
	£				£				£			£			£
As at 1 July 2013	1,966,060				492,103				293,427			(1,861,129)			890,461
Total comprehensive income
Loss for the year ended 30 June 2014	-				-				-			(205,606)			(205,606)
Transaction with owners
Expired redemption - B shares not taken up	-				24,675				-			-			24,675
Issue of ordinary shares	-				-				-			-			-
Premium on shares issued	-				-				-			-			-
Cost of share options	-				-				-			-			-
	-				24,675				-			-			24,675
As at 30 June 2014	1,966,060				516,778				293,427			(2,066,735)			709,530
Total comprehensive income
Profit for the period ended 31 Dec 2014	-				-				-			(90,344)			(90,344)
As at 31 December 2014	1,966,060				516,778				293,427			(2,157,079)			619,186

	Account	Account	Account	Earnings	Total equity
	£	£	£	£	£
As at 1 July 2012	1,946,060	480,295	305,235	(1,106,038)	1,625,552
Total comprehensive income
Loss for the year ended 30 June 2013	-	-	-	(755,091)	(755,091)
Transaction with owners
Issue of ordinary shares	20,000	-	-	-	20,000
Premium on shares issued	-	11,808	-	-	11,808
Costs of share options	-	-	(11,808)	-	(11,808)
	20,000	11,808	(11,808)	-	20,000
At 30 June 2013	1,966,060	492,103	293,427	(1,861,129)	890,461

CONDENSED STATEMENT OF CASH FLOWS

FOR THE PERIOD ENDED 31 DECEMBER 2014

					Six months ended		Six months ended				Year ended
					31 Dec 2014		31-Dec-13							30-Jun-14
					(unaudited)		(unaudited)				(audited)
					£		£				£
Net Cash (outflows) from
operating activities					(58,123)		(71,722)				(174,374)
Cash flows from investing activities
Sale of investments					50,582		-				-
Net cash generated from investing activities					50,582		-				-
Cash flows from financing activities
Expired redemption - B Shares not taken up					-		-				24,675
Net cash used in financing activities					-		-				24,675
Net (decrease) in cash and cash equivalents					(7,541)		(71,722)				(149,699)
Cash and cash equivalents at the beginning of the period					76,866		226,565				226,565
Cash and cash equivalents at the end of the period					69,325		154,843				76,866

Reconciliation of net cash flow from operating activities

					Six months ended			Six months ended			Year ended
					31 Dec 2014			31-Dec-13			30-Jun-14
					(unaudited)			(audited)			(audited)
					£			£			£
Total comprehensive (loss) / income for the period					(90,344)			18,432			(205,606)
Adjustment for unrealised (gain) /loss on investments at fair value through profit or loss					(263,960)			(88,305)			63,287
Adjustments for realised gains on investments at fair value through profit or loss					294,644			-			-
Decrease in prepayments and accrued income					6,086			2,680			35
Decrease in creditors and accrued expenses					(4,548)			(4,529)			(32,090)
Net cash out flow from operating activities					(58,122)			(71,722)			(174,374)

NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED 31 DECEMBER 2014

1.   Accounting Policies

Basis of accounting

The interim financial statements have been prepared in accordance with the International Accounting Standard ("IAS") 34, Interim Financial Reporting.

The interim financial statements do not include all the information and disclosures required in the annual financial statements and should be read in conjunction with the Company's annual financial statements for the period to 31 December 2014. The annual financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS").

The same accounting policies and methods of computation are followed in the interim financial statements as in the annual financial statements for the period ended 31 December 2014.

2.  Investments

	Six months ended		Six months ended		Year ended
	31-Dec-14		31-Dec-13		30-Jun-14
	(unaudited)		(unaudited)		(audited)
	£		£		£
Sterling Energy PLC, at market value	58,620		216,250		148,150
Cost, 300,000 shares	517,838		863,064		863,064
(31 December 2013: 500,000, 30 June 2014: 500,000 shares)
Argos Resources Limited, at market value	145,000		145,000		135,000
Cost, 1,000,000 shares	310,775		310,775		310,775
(31 December 2013: 1,000,000, 30 June 2014: 1,000,000 shares)
Falkland Oil and Gas Limited ("Falkland"), at market value	296,553		374,380		361,650
Cost, 1,446,600 shares	966,029		966,029		966,029
(31 December 2013: 400,000 shares, 30 June 2014: 1,446,000 shares)*
Pancontinental Oil & Gas NL ("Pancontinental"), at market value	101,448		98,850		38,088
Cost, 3,000,000 shares	393,246		393,246		393,246
(31 December 2013: 3,000,000 shares, 30 June 2014: 3,000,000 shares)
Total market value	601,621		834,480		682,888
	2,187,888		2,533,114		2,533,114
Total cost
Current period movement	(1,586,267)		(1,698,634)		(1,850,226)
Reverse prior year FV adjustment	1,850,226		1,786,939		1,523,283
	263,959		88,305		(326,943)
Realised (loss)/gain	(294,644)		-		263,656
Unrealised gain/(loss)	263,959		88,305		(326,943)
Current period income statement impact	(30,685)		88,305		(63,287)

On 9 December 2013 Desire was acquired by Falkland and 2,000,000 ordinary shares in Desire were converted into 1,246,600 ordinary shares in Falkland.

*Includes 1,246,600 ordinary shares received following Falklands acquisition of Desire Petroleum PLC.  

 

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