TIDM3LEG
RNS Number : 4336R
3Legs Resources plc
29 June 2015
3Legs Resources plc
("3Legs" or "the Company")
Final Results
The Board of 3Legs is pleased to announce the Company's final
audited results for the year ended 31 December 2014.
Chairman's Statement
The Company was listed on the AIM market in June 2011 having
raised GBP62.5m before expenses in order to focus on the
exploration and development of unconventional oil and gas resources
in Europe. However, in view of the disappointing results the then
Board announced last September that it had concluded that it could
not justify further investment in its concessions. After
considering the options open to it, the Board decided that the
return of the remaining cash resources, net of wind up costs, to
shareholders followed by an orderly liquidation would be in their
best interests.
Subsequently, a group of investors approached the then Board to
explore whether it would consider an alternative to liquidation
that would offer the Company's then shareholders some additional
value. These shareholders would receive a slightly larger sum of
cash, since the Company would save the costs of liquidation, and
would also have a continuing interest in the Company which was
valued at GBP0.2m at the price at which new investors proposed to
invest (in the event, the sum of GBP0.8m) into the Company. The
Board decided to put this alternative proposal to shareholders, who
duly voted in favour at a meeting held on 13 February 2015, at
which they also approved the second and final distribution of cash
of GBP1.1m or 1.33p per Ordinary Share.
As part of these arrangements Colin Weinberg and I joined the
Board and the existing directors resigned, other than Alex Fraser
who has subsequently stepped down. Shareholders also voted to adopt
the new Investing Policy, namely to invest in and/or acquire
companies within the technology sector or within the resources
sector.
However, subject to shareholders' approval at the forthcoming
Annual General Meeting, the planned focus of the Company's
Investing Policy will be amended to that of life sciences and
related technologies. In early June, the Company secured additional
funding of GBP0.5m representing 29.9% of the enlarged share
capital, from Jim Mellon and Dr Greg Bailey, both of whom have
joined the Board. Jim and Greg have a successful track record of
identifying profitable investments in healthcare and related
sectors and the proposed new direction for the Company will enable
it to capitalise on their expertise and contacts in this area. The
new Investing Policy is set out in the Appendix to the Notice of
Annual General Meeting to be held on 31 July 2015. The current
Investing Policy is described in the Report and Accounts as a
matter of record.
Full details of the Company's previous activities for the first
nine months of 2014 were provided in the interim results statement
and subsequent developments are highlighted in the Directors'
Report. The results for the twelve months to 31 December 2014
reflect the decision of the Board to cease its exploration
activities, which was achieved by selling its relevant subsidiaries
for a nominal consideration. Accordingly, exploration expenditure
which had formerly been carried forward as an asset on the balance
sheet as both capital exploration expenditure in respect of the
interests held in the Eastern Baltic Basin licences and also under
"an investment accounted for using the equity method" had to be
written off. As a result, the Company made a loss on disposal of
subsidiaries and its interest in joint ventures of GBP33.6m,
leading to a loss for the full year of GBP35.0m.
Further to the restructuring that has taken place, the Company
has become an Investing Company and the Board looks forward to
implementing its new Investing Policy.
I would like to express my thanks to our shareholders and
advisers for their support during this period of change.
Richard Armstrong
Chairman
Consolidated Income Statement
for the year ended 31 December 2014
2014 2013
Notes GBP'000 GBP'000
Discontinued operations
Administrative expenses (1,854) (2,034)
Foreign exchange gains/(losses) 54 (632)
Share based payment 825 (99)
Non-capitalised exploration and evaluation
expense - (451)
Impairment of intangible exploration
and evaluation assets - (135)
Impairment of loan - (226)
Operating loss 4 (975) (3,577)
Share of results of joint venture (481) (902)
Investment income 58 172
Loss on disposal of subsidiaries and
joint venture 3 (33,626) -
Loss for the year (35,024) (4,307)
========= =========
Attributable to:
Equity holders of the parent (35,024) (4,307)
(35,024) (4,307)
======== =========
Loss per Ordinary Share
Discontinued operations
Basic and diluted, pence per share 5 (0.41p) (0.05p)
======== =========
All activities are derived from discontinued operations.
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2014
2014 2013
GBP'000 GBP'000
Loss for the year (35,024) (4,307)
Other comprehensive income
Exchange differences arising on translation
of foreign operations 329 62
Total comprehensive income for the
year attributable to owners of the
parent company (34,695) (4,245)
======== =========
Consolidated Balance Sheet
as at 31 December 2014
2014 2013
Notes GBP'000 GBP'000
Assets
Non-current assets
Intangible exploration and evaluation
assets - 2,357
Investment accounted for using the equity
method - 23,515
- 25,872
Current assets
Trade and other receivables 95 323
Cash and cash equivalents 1,341 26,792
1,436 27,115
Total assets 1,436 52,987
======== ========
Liabilities
Current liabilities
Trade and other payables (144) (398)
Provisions - (25)
(144) (423)
Total liabilities (144) (423)
======== ========
Net assets 1,292 52,564
======== ========
Equity
Share capital 6 22 21
Share premium account 52,594 68,347
Share-based payment reserves - 889
Accumulated deficit (51,324) (16,362)
Cumulative translation reserves - (331)
Total equity 1,292 52,564
======== ========
Consolidated Cash Flow Statement
for the year ended 31 December 2014
2014 2013
Notes GBP'000 GBP'000
Net cash outflow from operating activities 7 (1,486) (2,783)
Investing activities
Interest received 58 172
Purchases of intangible exploration
and evaluation assets - (40)
Proceeds of disposal of intangible exploration
and evaluation assets - 250
Investment in joint venture (8,235) (10,148)
Net cash used in investing activities (8,177) (9,766)
Financing activities
Issue of share capital 180 17
Return of cash to shareholders (15,933) -
Net cash (outflow)/inflow from financing
activities (15,753) 17
Net decrease in cash and cash equivalents (25,416) (12,532)
Effect of foreign exchange rate changes
on cash and cash equivalents (35) (207)
Cash and cash equivalents at beginning
of year 26,792 39,531
Cash and cash equivalents at end of
year 1,341 26,792
======== =========
All cash flows are attributable to the operating, investing and
financing activities of discontinued operations.
Consolidated Statement of Changes in Equity
for the year ended 31 December 2014
Share Share-based Cumulative
Share premium payment Accumulated translation
capital account reserves deficit reserves Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
As at 1 January
2013 21 68,330 790 (12,055) (393) 56,693
Transactions with
owners in their
capacity as owners:
Issue of equity
shares - 17 - - - 17
Total transactions
with owners in their
capacity as owners - 17 - - - 17
Loss for the year - - - (4,307) - (4,307)
Other comprehensive
income:
Currency translation
differences - - - - 62 62
Total comprehensive
income for the year - - - (4,307) 62 (4,245)
Share-based payments - - 99 - - 99
As at 1 January
2014 21 68,347 889 (16,362) (331) 52,564
Transactions with
owners in their
capacity as owners:
Issue of equity
shares 1 180 - - - 181
Return of cash to
shareholders - (15,933) - - - (15,933)
Total transactions
with owners in their
capacity as owners 1 (15,753) - - - (15,752)
Loss for the year - - - (35,024) - (35,024)
Other comprehensive
income:
Currency translation
differences - - - (2) 331 329
Total comprehensive
income for the year - - - (35,026) 331 (34,695)
Share-based payments - - (825) - - (825)
Transfer to retained
earnings in respect
of exercised share
options - - (64) 64 - -
As at 31 December
2014 22 52,594 - (51,324) - 1,292
====== ====== ====== ====== ====== ======
Notes
1 General information
3Legs Resources plc (the 'Company' and, together with its
subsidiary, the 'Group') is incorporated in the Isle of Man,
British Isles under the Isle of Man Companies Act 2006. The address
of the registered office is Commerce House, 1 Bowring Road, Ramsey,
Isle of Man, British Isles, IM8 2LQ.
The principal activity of the Group during 2014 was the
exploration, evaluation and development of oil and gas targets. The
Company is now classified as an Investing Company.
2 Business and geographical segments
At the balance sheet date, all of the Group's exploration assets
had been disposed of. Throughout the year until the date of the
disposal of the assets, the Directors consider there to be only one
business segment, namely the exploration and development of oil and
gas resources. The Directors consider there to be one material
operating segment, being Poland. All segments relate to
discontinued operations.
3 Discontinued operations
On 17 September 2014, the Company reported to shareholders that
it had exercised its one-time option to cease participation in
activity in its principal exploration project in Poland's Baltic
Basin and to terminate its other exploration activities.
4 Operating loss
The operating loss for the year has been arrived at after
(crediting)/charging:
2014 2013
GBP'000 GBP'000
Property lease payments 79 114
Staff costs 121 1,033
Share-based payments (825) 99
Impairment of intangible exploration and
evaluation assets - 135
Audit fees 20 65
Net foreign exchange (gains)/losses (54) 632
======== ========
5 Loss per Ordinary Share
Basic loss per Ordinary Share is calculated by dividing the net
loss for the year attributable to Ordinary equity holders of the
parent by the weighted average number of Ordinary Shares
outstanding during the year. The calculation of the basic and
diluted loss per Ordinary Share is based on the following data:
2014 2013
GBP'000 GBP'000
Losses
Loss for the purposes of basic loss per share
being net loss attributable to equity holders
of the parent
From discontinued operations (35,024) (4,307)
======== ========
2014 2013
Number of shares Number Number
Weighted average number of Ordinary Shares
for the purposes of basic loss per share 85,156,833 84,804,650
======= =======
2014 2013
GBP GBP
Loss per Ordinary Share
Basic and diluted, pence per share (0.41)p (0.05)p
======== ========
Dilutive loss per Ordinary Share equals basic loss per Ordinary
Share as, due to the losses incurred in 2013 and 2014, there is no
dilutive effect from the subsisting share options.
6 Share capital
Authorised and issued equity share capital
2014 2013
Number Number
'000 GBP'000 '000 GBP'000
Authorised
Ordinary Shares of GBP0.00025
each 440,000 110 440,000 110
======== ======== ========= =========
Issued and fully paid
Ordinary Shares of GBP0.00025
each 86,127 22 84,847 21
========= ========= ========= ========
The Company has one class of Ordinary Shares, which carry no
right to fixed income.
On 13 February 2015 the authorised share capital was increased
from GBP110,000 to GBP260,000.
Issued equity share capital
Ordinary Shares
of GBP0.00025
Number
At 1 January 2014 84,846,645
Issue of Ordinary Shares 1,280,084
At 31 December 2014 86,126,729
=========
In total 136,696 Ordinary Shares were issued to Non-executive
directors under the remuneration plan, with a total value of
GBP31,498.63.
1,143,388 Ordinary Shares were issued as a result of exercised
share options.
7 Notes to the cash flow statement
2014 2013
GBP'000 GBP'000
Loss before tax (35,024) (4,307)
Adjustments for:
Effect of foreign exchange rate changes 366 879
Impairment of E&E assets - 135
Reversal of provision for E&E licences - 75
Investment income (58) (172)
Share-based payments (825) 99
Share of results of joint venture 481 902
Disposal of subsidiaries and joint venture 33,626 -
Reversal of provision for decommissioning (25) -
Operating cash flows before movements in
working capital (1,459) (2,389)
Decrease in receivables 228 194
Decrease in payables (255) (588)
Cash used in operations (1,486) (2,783)
Taxation paid - -
Net cash outflow from operating activities (1,486) (2,783)
======== ==========
Cash and cash equivalents (which are presented as a single class
of assets on the balance sheet) comprise cash at bank and short
term bank deposits with an original maturity of three months or
less. The carrying value of these assets is approximately equal to
their fair value.
8 Events after the balance sheet date
On 13 February 2015, the Company held an Extraordinary General
Meeting at which the following resolutions were passed; to approve
the final capital return of 1.33 pence per Ordinary Share; to allot
and issue 345,025,861 Ordinary Shares of GBP0.00025 each at a price
of 0.232 pence per share; and to approve the adoption of the
Investing Policy. In addition the authorised share capital was
increased from GBP110,000 to GBP260,000 and the Board was given
authority to allot further Ordinary Shares on a non pre-emptive
basis for an aggregate par value of GBP150,000.
On 9 June 2015, the Company issued 185,185,185 new Ordinary
Shares at a price of 0.270 pence per share and stated that it
proposed to ask shareholders to approve a new Investing Policy
focussing on life sciences and related technologies sectors at the
next Annual General Meeting.
NOTE TO THE FINAL RESULTS ANNOUNCEMENT OF 3LEGS RESOURCES PLC
FOR THE YEAR ENDED 31 DECEMBER 2014
The financial information set out above does not constitute the
Group's financial statements for the years ended 31 December 2014
or 2013, but is derived from those financial statements. The
auditors have reported on the 2013 and 2014 financial statements
which carried an unqualified audit report, did not include a
reference to any matters to which the auditor drew attention by way
of emphasis and did not contain a statement under section 498(2) or
498(3) of the Companies Act 2006.
Whilst the financial information included in this announcement
has been computed in accordance with International Financial
Reporting Standards (IFRS), this announcement does not in itself
contain sufficient information to comply with IFRS. The accounting
policies used in preparation of this preliminary announcement are
consistent with those in the full financial statements that have
yet to be published. The final results for the year ended 31
December 2014 were approved by the Board of Directors on 26 June
2015.
ENDS
Enquiries
3Legs Resources plc
Richard Armstrong Tel: 07787 500221
Colin Weinberg Tel: 07836 588504
Northland Capital Partners Limited Tel: 0207 382 1100
(Nominated Adviser and Broker)
Matthew Johnson / Edward Hutton (Corporate
Finance)
John Howes / Abigail Wayne (Corporate
Broking)
Peterhouse Corporate Finance Limited Tel: 0207 469 0934
(Joint Broker)
Lucy Williams / Duncan Vasey
This information is provided by RNS
The company news service from the London Stock Exchange
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