TIDMTSTR
RNS Number : 7224Z
Tri-Star Resources PLC
22 September 2015
TRI-STAR RESOURCES PLC
("Tri-Star" or the "Company")
22 September 2015
Interim Results for the six month period ended 30 June 2015
Tri-Star (AIM: TSTR) is pleased to announce results for the six
months ended 30 June 2015.
Results for the Period
In the six months to 30 June 2015, the Company recorded a
reduced operating loss of GBP1,083,000 (2014: GBP1,230,000; year to
31 December 2014: GBP2,282,000) and a total comprehensive loss of
GBP1,924,000 (2014: GBP534,000; year to 31 December 2014:
GBP2,501,000).
Business Review for the Period
Activity during the first half has focussed on the development
of the Oman Antimony Roaster Project ("OAR"). The OAR is a 20,000
tonne per year antimony roasting facility being developed in Sohar,
Sultanate of Oman by Strategic & Precious Metals Processing LLC
("SPMP"). Tri-Star owns a 40% equity interest in SPMP.
Notable developments in the period under review include:
- Environmental permitting. In February 2015 the Company
announced that SPMP had secured the required environmental licence
from the Ministry of Environmental and Climate Affairs in Oman
- In April 2015 SPMP received a final engineering report from a
third party commissioned to provide an in depth technical and
engineering review of the OAR
- Also in April 2015 the Company announced that SPMP had signed
heads of terms with a nominated trading partner with respect to the
supply and offtake of feedstock and finished product for the OAR;
and
- In June 2015 the Company announced that it had reached
agreement on a sale of Tri-Star's intellectual property relating to
the roasting of precious metal ores to SPMP for a cash
consideration of up to $6 million. The sale was conditional on SPMP
achieving financial close which took place after the period end: as
a result the transaction does not impact the Company's results for
the interim period to 30 June 2015.
Post the period under review, the Company has been able to
announce further important developments:
- On 24 August 2015 the Company announced that SPMP had entered
into definitive agreements with a provider of third party project
finance for the OAR; and
- On 16 September 2015 Tri-Star announced that the OAR had
achieved financial close, with a fully committed financing package
of $70 million, including $6 million invested by Tri-Star in return
for a 40% equity interest.
Financing
Post the period under review, on 5 August 2015, the Company
completed a placing, subscription and issue of loan notes which
raised GBP3.5 million before expenses.
On financial close of the OAR, Tri-Star completed its equity
investment of $6 million (GBP3.9 million) in SPMP through a cash
investment of $2.0 million from its own resources in SPMP in
addition to $4.0 million received from SPMP in connection with the
sale of the Company's intellectual property rights. A further $2
million (GBP1.3 million) tranche remains payable to Tri-Star by
SPMP in the future in relation to the sale of intellectual
property, contingent on successful commissioning of a pilot plant
on the site of the OAR.
As at close of business on 18 September 2015 Tri-Star held cash
balances of GBP1.75 million, putting the Company on a sound
financial footing for the foreseeable future.
Management changes
It is intended that the following management changes will take
place:
Emin Eyi is to be appointed Non-Executive Deputy Chairman of
Tri-Star, and will step down as Managing Director. Emin is expected
to take up the role of Chief Executive Officer of SPMP.
Guy Eastaugh will at the same time be appointed Chief Executive
Officer of Tri-Star, in addition to his existing role as Chief
Financial Officer.
Commenting on the management changes, Mark Wellesley Wood,
Chairman, said:
"Emin has been the driving force behind the Oman Antimony
Roaster project and the establishment of SPMP and we are very
pleased that having achieved financial close, he will be taking up
the role of CEO of SPMP. The success of this project is of
fundamental importance to Tri-Star and, as a 40% shareholder in
SPMP, we look forward to Emin continuing to progress the project to
a successful conclusion. We are delighted that Emin has agreed to
remain on our board as Deputy Chairman so that the Company can
continue to benefit from his knowledge and contacts within the
antimony and metal processing industries.
"We are also delighted that Guy has agreed to take on the
additional responsibilities of CEO of Tri-Star and will oversee the
next steps in the Company's strategy and development."
Enquiries:
Tri-Star Resources plc Tel: +44 (0)
Emin Eyi, Managing Director 20 3470 0470
Guy Eastaugh, Chief Financial
Officer
SP Angel Corporate Finance (Nomad Tel: +44 (0)
and Broker) 20 3470 0470
Robert Wooldridge / Jeff Keating
Yellow Jersey PR Limited (Media Tel: +44 (0)
Relations) 7738 076304
Alistair de Kare-Silver / Dominic
Barretto
TRI-STAR RESOURCES PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2015
Note Unaudited Unaudited Audited
Period Period Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
GBP'000 GBP'000 GBP'000
Share based payment
charge (11) (12) (21)
Exploration expenditure
and other administrative
expenses (1,072) (1,215) (2,255)
Amortisation of intangibles - (3) (6)
Total administrative
expenses and loss from
operations (1,083) (1,230) (2,282)
Share of loss in associated
companies (93) - (221)
Finance income 180 820 944
Finance cost (638) (357) (838)
---------- ---------- -------------
Loss before and after
taxation, and loss attributable
to the equity holders
of the Company (1,634) (767) (2,397)
Loss before and after
taxation attributable
to
Non-controlling interest (3) (44) (62)
---------- ---------- -------------
Equity holders of the
parent (1,631) (723) (2,335)
---------- ---------- -------------
Other comprehensive
(expenditure)/income
Items that will be reclassified
subsequently to profit
and loss
Exchange differences
on translating foreign
operations (290) 233 (104)
---------- ---------- -------------
Other comprehensive
(expenditure)/income
for the period, net
of tax (290) 233 (104)
---------- ---------- -------------
Total comprehensive
loss for the year, attributable
to owners of the company (1,924) (534) (2,501)
========== ========== =============
Total comprehensive
loss attributable to
Non-controlling interest (3) (44) (62)
Equity holders of the
parent (1,921) (490) (2,439)
Loss per share
Basic and diluted loss
per share (pence) 4 (0.02) (0.01) (0.03)
========== ========== =============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2015
Share Share Other Share-based Translation Retained Total Non-control-ling Total
capital premium reserves payment reserve earnings attributable interest equity
account reserve to
owners
of
parent
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1
January 2014
(audited) 2,520 13,162 (6,156) 1,072 (152) (8,131) 2,315 (173) 2,142
Issue of share
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capital - 10 - - - - 10 - 10
Share based
payments - - - 12 - - 12 - 12
Transactions
with owners - 10 - 12 - - 22 - 22
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Loss for the
period - - - - - (723) (723) (44) (767)
Exchange
difference
on
translation
of foreign
operations - - - - (115) - (115) - (115)
Total
comprehensive
loss for the
period - - - - (115) (723) (838) (44) (882)
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Balance at 30
June 2014
(unaudited) 2,520 13,172 (6,156) 1,084 (267) (8,854) 1,499 (217) 1,282
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Issue of share
capital 5 7 - - - - 12 - 12
Share based
payments - - - 9 - - 9 - 9
Transfer on
exercise of
options - - - (326) - 326 - - -
----------------
Transactions
with owners 5 7 - (317) - 326 21 - 21
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Loss for the
period - - - - - (1,612) (1,612) (18) (1,630)
Exchange
difference
on
translation
of foreign
operations - - - - 11 - 11 - 11
Total
comprehensive
loss for the
period - - - - 11 (1,612) (1,601) (18) (1,619)
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Balance at 31
December 2014
(audited) 2,525 13,179 (6,156) 767 (256) (10,140) (81) (235) (316)
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Issue of share
capital - 11 - - - - 11 - 11
Share based
payments - - - 11 - - 11 - 11
----------------
Transactions
with owners - 11 - 11 - - 22 - 22
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Loss for the
period - - - - - (1,631) (1,631) (3) (1,634)
Exchange
difference
on
translation
of foreign
operations - - - - (290) - (290) - (290)
Total
comprehensive
loss for the
period - - - - (290) (1,631) (1,921) (3) (1,924)
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
Balance at 30
June 2015
(unaudited) 2,525 13,190 (6,156) 778 (546) (11,771) (1,980) (238) (2,218)
-------------- ------------------- ----------------- ---------------- ----------------------- --------------- ----------------------- ----------------- -----------------------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2015
Unaudited Unaudited Audited
30 June 30 June 31 December
2015 2014 2014
Assets Notes GBP'000 GBP'000 GBP'000
Non-current
Intangible assets 5 4,443 4,747 4,777
Investment in associates - - 45
Property, plant and
equipment 6 72 77 68
---------- ---------- ------------
4,515 4,824 4,890
Current
Trade and other receivables 7 114 128 117
Cash and cash equivalents 327 896 1,496
Total current assets 441 1,024 1,613
Total assets 4,956 5,848 6,503
========== ========== ============
Liabilities
Current
Trade and other payables 8 274 433 324
Derivative financial
liability 9 448 426 626
Total current liabilities 722 859 950
Liabilities due after
one year
Loans 9 5,711 2,916 5,073
Deferred tax liability 741 791 796
Total liabilities 7,174 4,566 6,819
Equity
Issued share capital 2,525 2,520 2,525
Share premium 13,190 13,172 13,179
Share based payment
reserve 778 1,084 767
Other reserves (6,156) (6,156) (6,156)
Translation reserve (546) (267) (256)
Retained earnings (11,771) (8,854) (10,140)
---------- ---------- ------------
(1,980) 1,499 (81)
---------- ---------- ------------
Non-controlling interest (238) (217) (235)
Total equity (2,218) 1,282 (316)
Total equity and
liabilities 4,956 5,848 6,503
========== ========== ============
CONSOLIDATED STATEMENT OF CASH FLOWS
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FOR THE SIX MONTHS ENDED 30 JUNE 2015
Unaudited Unaudited Audited
Period Period Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
GBP'000 GBP'000 GBP'000
Cash flows from operating
activities
Loss after tax (1,634) (767) (2,397)
Amortisation of intangibles - 3 6
Depreciation 10 13 24
Finance income (1) (2) (4)
Finance cost 638 347 838
Loss from associates 93 221
Fees paid by shares 11 10 17
Equity settled share-based
payments 11 12 21
Movement on fair
value of derivatives (179) (808) (940)
(Increase) in trade
and other receivables (3) (39) (32)
(Decrease)/increase
in trade and other
payables (67) 25 (96)
Net cash outflow
from operating activities (1,121) (1,206) (2,342)
---------- ---------- ------------
Cash flows from investing
activities
Purchase of property,
plant and equipment (15) (9) (10)
Proceeds of sale
of property, plant
and equipment - 11 11
Cash invested in
associates (27) - (266)
Finance income 1 2 4
Net cash outflow
from investing activities (41) 4 (261)
---------- ---------- ------------
Cash flows from financing
activities
Proceeds from issue
of share capital - - 5
New loans - - 2,000
Net cash inflow from
financing activities - - 2,005
---------- ---------- ------------
Net (decrease) in
cash and cash equivalents (1,162) (1,202) (598)
Cash and cash equivalents
at beginning of period 1,496 2,101 2,101
Exchange differences
on cash and cash
equivalents (7) (3) (7)
Cash and cash equivalents
at end of period 327 896 1,496
---------- ---------- ------------
NOTES TO THE INTERIM REPORT
FOR THE SIX MONTHS ENDED 30 JUNE 2015
1. GENERAL INFORMATION
The financial information set out in this interim report does
not constitute statutory accounts as defined in Section 434 of the
Companies Act 2006. The Group's statutory financial statements for
the year ended 31 December 2014 have been completed and filed at
Companies House. The auditor's report on the annual financial
statements was unqualified and did not contain statements under
section 498(2) or section 498(3) of the Companies Act 2006.
2. ACCOUNTING POLICIES
BASIS OF PREPARATION
The Company's ordinary shares are quoted on the AIM market of
the London Stock Exchange and the Company applies the Companies Act
2006 when preparing its annual financial statements.
The annual financial statements for the year ended 31 December
2015 will be prepared under International Financial Reporting
Standards as adopted by the European Union (IFRS) and the principal
accounting policies adopted remain unchanged from those adopted in
preparing its financial statements for the year ended 31 December
2014.
The accounting policies have been applied consistently
throughout the Group for the purposes of preparation of these
condensed consolidated interim financial statements.
GOING CONCERN
The Directors have prepared cash flow forecasts for the period
ending 30 September 2016. The forecasts identify unavoidable third
party running costs of the Group and demonstrate that the Group
will have sufficient cash resources available to allow it to
continue in business for a period of at least twelve months from
the date of approval of these financial statements. Accordingly,
the accounts have been prepared on a going concern basis.
3. SEGMENTAL REPORTING
An operating segment is a distinguishable component of the Group
that engages in business activities from which it may earn revenues
and incur expenses, whose operating results are regularly reviewed
by the Group's chief operating decision maker to make decisions
about the allocation of resources and assessment of performance and
about which discrete financial information is available. The chief
operating decision maker has defined that the Group's only
reportable operating segment during the period is mining.
The Group has not generated any revenues from external customers
during the period.
In respect of the non-current assets as at 30 June 2015 of
GBP4,515,000, GBP48,000 arise in the UK (30 June 2014: GBP59,000,
31 December 2014: GBP53,000), and GBP4,467,000 arise in the rest of
the world (30 June 2014: GBP4,765,000, 31 December 2014:
GBP4,837,000).
4. LOSS PER SHARE
The calculation of the basic loss per share is based on the loss
attributable to ordinary shareholders divided by the weighted
average number of shares in issue during the period.
Unaudited Unaudited Audited
six months six months year ended
ended ended
30 June 30 June 31 December
2015 2014 2014
GBP'000 GBP'000 GBP'000
Loss on ordinary activities
after tax (GBP'000) (1,634) (767) (2,397)
---------------------- ---------------------- ----------------------
Weighted average number
of shares for calculating
basic loss per share 6,944,959,686 6,845,835,849 6,876,723,387
---------------------- ---------------------- ----------------------
Basic and diluted loss
per share (pence) (0.02) (0.01) (0.03)
---------------------- ---------------------- ----------------------
Diluted earnings per share is the same as basic loss per share
in each year because the potential shares arising under the share
option scheme, share warrants and convertible bonds are
anti-dilutive.
The weighted average number of ordinary shares excludes deferred
shares which have no voting rights and no entitlement to a
dividend.
5. INTANGIBLE ASSETS
Other Mining Goodwill Total
Intangible & Mineral
Exploration Licences
Asset
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 1 January
2014 4,076 102 815 4,993
Exchange
difference (123) - (24) (147)
--------------------- ------------------------ ----------------------- ---------------------
At 30 June
2014 3,953 102 791 4,846
Exchange
difference 28 - 5 33
--------------------- ------------------------ ----------------------- ---------------------
At 31 December
2014 3,981 102 796 4,879
Exchange
difference (279) - (55) (334)
At 30 June
2015 3,702 102 741 4,545
--------------------- ------------------------ ----------------------- ---------------------
Amortisation
and
impairment
At 1 January
2014 - 96 - 96
Amortisation
charge
in the year - 3 - 3
--------------------- ------------------------ ----------------------- ---------------------
At 30 June
2014 - 99 - 99
Amortisation
charge
in the year - 3 - 3
---------------------
At 31 December
2014 - 102 - 102
Amortisation - - - -
charge
in the year
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---------------------
At 30 June
2015 - 102 - 102
--------------------- ------------------------ ----------------------- ---------------------
Net book value
At 30 June
2015 3,702 - 741 4,443
--------------------- ------------------------ ----------------------- ---------------------
At 31 December
2014 3,981 - 796 4,777
--------------------- ------------------------ ----------------------- ---------------------
At 30 June
2014 3,953 3 791 4,747
--------------------- ------------------------ ----------------------- ---------------------
At 1 January
2014 4,076 6 815 4,897
--------------------- ------------------------ ----------------------- ---------------------
The exploration asset relates to the acquisition of Portage
Minerals Inc. during 2013. The exploration asset has not yet been
amortised as actual exploitation or material development of the
asset have yet to commence.
Goodwill on acquisition relates to goodwill arising on the
acquisition of Portage Minerals Inc in 2013. Mining and mineral
licences are amortised on a straight line basis over the life of
the licences.
6. PROPERTY, PLANT & EQUIPMENT
Land Vehicles Equipment Total
GBP' GBP'
000 000 GBP'000 GBP'000
Cost
At 1 January 2014 2 116 43 161
Additions - 9 - 9
Disposals - (12) - (12)
Exchange difference - (2) (1) (3)
At 30 June 2014 2 111 42 155
----------------- ---------------- ----------------------- ----------------
Additions - 0 1 1
Exchange difference - 1 - 1
At 31 December 2014 2 112 43 157
----------------- ---------------- ----------------------- ----------------
Additions - - 15 15
Exchange difference - (7) (1) (8)
Cost at 30 June 2015 2 105 57 164
================= ================ ======================= ================
Depreciation
At 1 January 2014 - 43 31 74
Exchange difference - (1) (1) (2)
Eliminated on disposals - (7) - (7)
Charge for the year - 8 5 13
At 30 June 2014 - 43 35 78
----------------- ---------------- ----------------------- ----------------
Charge for the year - 9 2 11
At 31 December 2014 - 52 37 89
----------------- ---------------- ----------------------- ----------------
Exchange difference - (6) (1) (7)
Charge for the year - 9 1 10
----------------- ---------------- ----------------------- ----------------
At 30 June 2015 - 55 37 92
================= ================ ======================= ================
Net book value
At 30 June 2015 2 50 20 72
----------------- ---------------- ----------------------- ----------------
At 31 December 2014 2 60 6 68
----------------- ---------------- ----------------------- ----------------
At 30 June 2014 2 68 7 77
----------------- ---------------- ----------------------- ----------------
At 1 January 2014 2 73 12 87
----------------- ---------------- ----------------------- ----------------
Exchange differences have arisen on assets which are held by
foreign subsidiaries. These are translated from the functional
currency of the subsidiary into Sterling at the prevailing exchange
rate at each period end.
7. TRADE AND OTHER RECEIVABLES
Unaudited Unaudited Audited
30 June 30 June 31 December
2015 2014 2014
GBP'000 GBP'000 GBP'000
Current
Other receivables 86 96 57
Prepayments and accrued
income 28 32 60
Trade and other receivables 114 128 117
========== ========== ============
8. TRADE AND OTHER PAYABLES
Unaudited Unaudited Audited
30 June 30 June 31 December
2015 2014 2014
GBP'000 GBP'000 GBP'000
Trade payables 51 100 102
Social security and
other taxes 22 15 21
Other payables 155 127 138
Accruals and deferred
income 46 191 63
274 433 324
========== ========== ============
9. CONVERTIBLE SECURED LOAN NOTES
In 2014 Tri-Star issued GBP4m convertible secured loan notes
("Convertible Bonds") to Odey European Inc. The Convertible Bonds
carry a non-cash coupon of 15% per annum which compounds half
yearly and are secured by way of a guarantee and debenture granted
by Tri-Star Antimony Canada Inc. They are redeemable at 100% of
their principal amount plus accrued interest on 19 June 2018
(unless otherwise previously redeemed or converted).
The Convertible Bonds are convertible at 100% of their principal
amount plus accrued interest at the holder's option into ordinary
shares at a conversion price which is fixed at the time of
conversion at a 10% discount to the lower of:
- the latest equity funding round completed prior to the issue
of the conversion notice; and
- any equity funding round completed within 10 days of the conversion notice
As at 30 June 2015, 30 June 2014 and 31 December 2014, the
conversion price stood at GBP0.0027 per Tri-Star ordinary
share.
The carrying value of the host debt component of the Convertible
Bonds at 30 June 2015 amounted to GBP5,711,000 (31 December 2014:
GBP5,073,000, 30 June 2014: GBP2,916,000).
The conversion option (limited by the early repayment clause) is
an embedded derivative treated as a liability at fair value through
profit and loss. At 30 June 2015, the fair value of the embedded
derivative, calculated using the Black-Scholes option valuation
model, was GBP448,000 (31 December 2014: GBP626,000, 30 June 2016:
GBP426,000). The decrease in fair value in the 6 month period,
amounting to GBP178,000, has been recorded in finance income in the
Consolidated Income Statement for the period ended 30 June 2015 (31
December 2014: GBP133,000, 31 March 2015: GBP808,000).
The Convertible Bonds are recorded in the Consolidated Statement
of Financial Position as:
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