TIDMGTL
RNS Number : 9107R
GTL Resources PLC
11 November 2011
For Immediate Release 11 November 2011
GTL Resources PLC
("GTL" or the "Group")
Unaudited Interim Results
GTL Resources PLC (AIM: GTL), the US based bio-refining company,
today announced interim results for the six months ended 30
September 2011 (First Half FY2012).
Highlights for the period:
-- Pre-tax profit of $5.4 million (First Half FY2011: $6.2
million, which included $1.7 million of exceptional business
interruption proceeds). Excluding the FY2011 exceptional item,
pre-tax profit increased $0.9 million, or 19.2%.
-- EBITDA of $14.1 million (First Half FY2011: $15.6 million,
which included $1.7 million of exceptional business interruption
proceeds)
-- Net debt decreased $8.2 million from year end 31 March 2011
and $17.1 million from 30 September 2010
-- Revenue increased 65.6% to $180.8 million (First Half FY2011: $109.2 million)
-- Commodity margins improved 5.4% to $0.59/gallon (First Half FY2011: $0.56/gallon)
-- Ethanol production of 55.0 million gallons (First Half FY2011: 55.2 million gallons)
Commenting on the results, CEO Richard Ruebe said: "We are
delighted with GTL's performance for the period. Operationally, the
GTL plant ran at a 110 million gallon annualized rate for the
period, despite taking an extended maintenance shut down in May
2011 to install our new corn milling building, steel corn bin, and
corn conveyance system. Our operations team is constantly reviewing
the way we operate to identify improvements and de-bottleneck
constraints for increased production. Other improvements made
during the extended May 2011 plant shutdown allowed the plant to
run at higher production rates this past summer than in previous
summers. Production from July to September 2011 indicates the plant
can now produce at a 115 million gallons per annum rate when
commodity margins warrant maximum production. For the six month
period, commodity margins improved nearly 6% over the same period
last year resulting in net debt reduction of $8.2 million."
For further information please contact:
GTL Resources
Richard Ruebe, CEO +1 630-773-1226
Cenkos
Stephen Keys +44 2073 978928
Elizabeth Bowman
Buchanan Communications
Charles Ryland +44 2074 665000
Ben Romney
CEO Statement
Interim Results
GTL's strong operational and commercial performance enabled the
Group to achieve improved earnings (excluding the FY2011
exceptional item) for the six months ending 30 September 2011. GTL
continued to improve elements of the business under its control.
Recent production rates have increased and yields have improved.
Year over year, ethanol and DDGS prices have significantly
increased. In July 2011, ethanol reached a five year high selling
price of $3.17 per gallon but corn costs also significantly
increased during the period. Corn costs reached a record high of
$7.87/bushel on the Chicago Board of Trade for prompt pricing in
June 2011. The effect of these key component changes resulted in a
net increase of $0.03 per gallon in the GTL commodity margin
(Ethanol + DDGS - Corn costs - Natural Gas costs) over the same
period last year.
Key Performance Indicators (unaudited)
Six Months Six Months
to 30 September to 30 September
2011 2010 Change
----------------------------------- ----------------- ----------------- --------
Production (mil. denatured gals.) 55.0 55.2 -0.2
Ethanol yield (den. gals./bushel) 2.84 2.80 +0.04
Ethanol net price ($/gal) $2.67 $1.63 +$1.04
DDGS net price ($/ton) $206 $121 +$85
Corn net price ($/bushel) $7.09 $3.53 +$3.56
Natural Gas net price ($/MMBtu) $4.74 $4.91 -$0.17
Commodity margin ($/gal) $0.59 $0.56 +$0.03
Results Summary (unaudited)
Six Months Six Months
to 30 September to 30 September
2011 2010 Change
---------------------------- ----------------- ----------------- -------
Ethanol sales (million
gallons) 55.6 54.8 +0.8
$M $M $M
Revenue 180.8 109.2 +71.6
EBITDA 14.1 15.6 -1.5
Pre-tax profit 5.4 6.2 -0.8
Earnings per share (basic) $0.08 $0.12 -$0.04
Revenue of $180.8 million for the period was $71.6 million
higher than the same period last year (First Half FY2011: $109.2
million). Ethanol sales of 55.6 million gallons were made at an
average net price (after freight and commission) of $2.67 per
gallon. Ethanol revenue of $149.5 million increased $58.8 million
over the same period last year of $90.7 million, due to higher
volume of $1.4 million and higher sales prices of $57.4 million.
DDGS sales of 149.9 thousand tons realized an average net price of
$206 per ton (First Half FY2011: $121 per ton). DDGS gross revenues
of $31.3 million were $12.8 million more than the same period last
year, mainly due to higher sales prices.
Cost of sales for the period increased $71.0 million to $162.1
million (First Half FY2011: $ 91.1 million). The increase was
primarily related to higher corn costs per bushel with a relatively
much smaller offset from the improved yield per bushel of corn.
Administrative expenses for the period were $10.6 million, $0.6
million higher than the prior year amount of $10.0 million.
Administrative expenses include depreciation, plant administrative
expenses, and corporate overhead costs. The increase in
administrative expenses was primarily due to higher legal fees
relating to litigation brought by the Group (described in Note 7)
and depreciation expense.
Finance expenses for the period of $3.1 million were down from
last year's expenses by $1.2 million (First Half FY2011: $4.3
million) as a result of reduced debt levels and the expiration of
the interest rate swaps on 30 June 2011.
For the six months ended 30 September 2011, the Group reported
profit before tax of $5.4 million versus prior year's $6.2 million.
The decrease of $0.8 million was due to one-time business
interruption insurance proceeds of $1.7 million that were received
during the six months ended 30 September 2010. Profit before tax
for the six months ended 30 September 2011, excluding business
interruption proceeds in FY2011, was an increase of $0.9 million
from the prior year.
Income tax expense was $2.1 million for the period versus $1.6
million in the prior year. The increase relates to the reversal of
a $1 million valuation allowance relating to Net Operating Loss
(NOL) utilisation in the US during the six months ended 30
September 2010. GTL records income tax expense at the statutory tax
rates on book income. However, based on accelerated depreciation
for tax purposes, it is expected that GTL will not be in a federal
income tax paying position for several years. At the state level,
Illinois has suspended NOL utilisation for three years to address
its deficit which may cause GTL to make state income tax payments
starting in fiscal 2013. GTL expects the effective tax rate for
book purposes to be in the 41% range for FY2012 and subsequent
years.
GTL's profit for the period attributable to the equity holders
of the Group was $2.5 million (First Half FY2011: $3.8 million),
and represented a profit of $0.08 per basic share (First Half
FY2011: $0.12 per basic share).
Inventory Levels
Inventories were $11.3 million at 30 September 2011, an increase
of $2.5 million from 30 September 2010 due to higher corn costs per
bushel. Volume levels for corn at 30 September 2011 were flat when
compared to 30 September 2010.
Net Debt
The Group's objectives when managing debt are to safeguard the
Group's ability to continue as a going concern so that it can
continue to provide benefits and value for shareholders and other
stakeholders. One of the subsidiaries of the Company, Illinois
River Energy (IRE), holds restricted use, debt service and
contingency bank deposits. The restricted use bank deposits are
current cash funds drawn down under the terms of the senior debt
agreement that are to be applied to specific trade creditor
balances. The debt service bank deposits must be maintained under
loan covenants to guarantee the capability of IRE to make minimum
interest and loan repayments. IRE maintains debt service bank
deposits along with restricted cash deposits that effectively
reduce total debt.
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
Loans and borrowings
----------------------------------- ---------------------- ------------------- ------------
Non-current liabilities 94,750 114,752 103,752
Current liabilities 7,141 7,038 7,039
----------------------------------- ---------------------- ------------------- ------------
Total loans and borrowings 101,891 121,790 110,791
Less: Other financial assets
- Non-
current 10,426 17,488 10,384
Other financial assets
- Current 9,945 4,242 10,136
Cash and cash equivalents 6,379 7,768 6,895
----------------------------------- ---------------------- ------------------- ------------
Net debt 75,141 92,292 83,376
=================================== ====================== =================== ============
Current Trading and Prospects
The IRE plant is performing well and continues to produce above
nameplate capacity. Market margins have been favourable for ethanol
producers in the weeks since the period ended. Although, as
highlighted in our recent AGM Trading Statement in September, with
certain regulatory and legislative issues pending, we appreciate
that long term visibility on commodity margins is hard to predict.
GTL's commodity margins are largely driven by the volatile
commodity prices of ethanol, corn and natural gas resulting in
forecast visibility that is very short term. Management expects to
see some increased temporary volatility due to the anticipated 31
December 2011 expiration of the ethanol blender's credit (the
result of which may be a pre-year end increase in commodity
margins, and subsequent post-year end decline). Overall, we expect
that the 13.2 billion corn based ethanol gallons mandated by RFS2,
the steadily growing amount of US ethanol exports, and the gradual
introduction of 15 per cent ethanol blends for newer model cars in
the US together should all have a positive impact on industry
demand.
Subsequent Event
On 31 October 2011, a press release was issued announcing a GTL
Board recommended offer by Sinav Limited ("Sinav" or the "Offeror")
to acquire all the shares of GTL. Prior to the announcement, Sinav
and its affiliates owned 22.66% of GTL. Highlights of the offer are
as follows:
-- Sinav will pay 100 pence in cash for all of the outstanding
shares it does not currently own, representing a 34% premium over
the 74.50 pence closing price on October 28(th) , the last day of
trading prior to the offer announcement. Current GTL shareholders,
under certain circumstances, may elect to "roll over" their shares
to retain an ownership interest in GTL.
-- The Offeror's intent is to delist GTL from the AIM exchange
in London and run the business as a private company
-- After the transaction is completed, GTL will have a new Board
of Directors and no public company expenses
-- The Offeror has indicated its intent to retain all GTL and
IRE employees to pursue GTL management's medium term strategy of
increasing production volumes and pursuing alternative revenue
streams. There are no plans to change the principal locations of
the business.
-- The transaction is expected to close in approximately two to three months
10 November 2011
Richard Ruebe
Company CEO
GTL Resources PLC
Condensed consolidated statement of comprehensive income
for the 6 months ended 30 September 2011
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
---------------------------------- -------------------------- ---------------------- ------------------------
Revenue 180,827 109,159 261,447
Cost of sales (162,059) (91,121) (223,397)
---------------------------------- -------------------------- ---------------------- ------------------------
Gross profit 18,768 18,038 38,050
Administrative expenses -
exceptional - 1,679 1,679
Administrative expenses (10,641) (10,035) (21,492)
---------------------------------- -------------------------- ---------------------- ------------------------
Results from operating activities 8,127 9,682 18,237
Finance income 403 807 1,589
Finance expenses (3,112) (4,263) (7,842)
---------------------------------- -------------------------- ---------------------- ------------------------
Profit before tax 5,418 6,226 11,984
Income tax expense (2,113) (1,591) (4,100)
---------------------------------- -------------------------- ---------------------- ------------------------
Profit and total comprehensive
income
for the period 3,305 4,635 7,884
================================== ========================== ====================== ========================
Profit and comprehensive income
attributable
to:
Equity holders of the company 2,530 3,750 6,175
Non-controlling interest 775 885 1,709
---------------------------------- -------------------------- ---------------------- ------------------------
Profit and comprehensive income
for
the period 3,305 4,635 7,884
---------------------------------- -------------------------- ---------------------- ------------------------
Earnings per share
Basic earnings per ordinary share $0.08 $0.12 $0.19
---------------------------------- -------------------------- ---------------------- ------------------------
Diluted earnings per ordinary
share $0.08 $0.12 $0.19
---------------------------------- -------------------------- ---------------------- ------------------------
Condensed consolidated statement of financial position
at 30 September 2011
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
------------------------------------- ------------------ ------------------ ---------------
Assets
------------------------------------- ------------------ ------------------ ---------------
Property, plant and equipment 153,472 158,707 156,872
Intangible assets - goodwill 7,390 7,390 7,390
Investments 445 100 510
Other financial assets 10,426 17,488 10,384
Total non current assets 171,733 183,685 175,156
------------------------------------- ------------------ ------------------ ---------------
Inventories 11,295 8,799 10,744
Trade and other receivables 3,300 4,301 3,931
Other current assets 827 1,452 1,272
Other financial assets 9,945 4,242 10,136
Cash and cash equivalents 6,379 7,768 6,895
Total current assets 31,746 26,562 32,978
------------------------------------- ------------------ ------------------ ---------------
Total assets 203,479 210,247 208,134
------------------------------------- ------------------ ------------------ ---------------
Equity
Share capital 60,205 60,205 60,205
Share premium 317 317 317
Retained earnings 12,245 7,129 9,623
------------------------------------- ------------------ ------------------ ---------------
Total equity attributable to equity
holders of the Company 72,767 67,651 70,145
Non-controlling interest 10,143 8,544 9,368
------------------ ------------------ ---------------
Total equity 82,910 76,195 79,513
------------------------------------- ------------------ ------------------ ---------------
Liabilities
Loans and borrowings 94,252 114,752 103,752
Finance lease obligation 498 - -
Deferred revenue 4,560 3,659 3,846
Deferred income tax liabilities 6,214 1,591 4,100
------------------------------------- ------------------ ------------------ ---------------
Total non current liabilities 105,524 120,002 111,698
------------------------------------- ------------------ ------------------ ---------------
Trade and other payables 7,108 5,786 9,418
Finance lease obligation 102 - -
Other financial liabilities at fair
value through the profit and loss - 1,095 332
Loans and borrowings 7,039 7,038 7,039
Deferred revenue 796 131 134
Total current liabilities 15,045 14,050 16,923
------------------------------------- ------------------ ------------------ ---------------
Total liabilities 120,569 134,052 128,621
------------------------------------- ------------------ ------------------ ---------------
Total equity and liabilities 203,479 210,247 208,134
------------------------------------- ------------------ ------------------ ---------------
These financial statements were approved by the Board of
Directors on 10 November 2011 and were signed on its behalf by:
Richard Ruebe
Company CEO
GTL Resources PLC
Condensed consolidated statement of cash flows
for the 6 months ended 30 September
2011
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
------------------------------------------- ------------------- ---------------- --------------
Cash flows from operating activities
Profit for the period 3,305 4,635 7,884
Adjustments for:
Depreciation and amortization 6,107 5,774 11,921
Deferred revenue 548 (68) (134)
Loss on disposal of assets - 152 319
Net finance expense 2,709 3,314 6,253
Share based payment transactions 92 37 106
Income tax expense 2,113 1,591 4,100
------------------------------------------- ------------------- ---------------- --------------
14,874 15,435 30,449
Change in inventories (551) (3,390) (5,335)
Change in trade and other receivables 631 (870) (500)
Change in other current assets 445 38 212
Change in trade and other payables (2,310) (1,228) 2,438
------------------------------------------- ------------------- ---------------- --------------
13,089 9,985 27,264
Interest paid (3,112) (4,144) (7,876)
------------------- ---------------- --------------
Net cash from operating activities 9,977 5,841 19,388
------------------------------------------- ------------------- ---------------- --------------
Cash flows from investing activities
Interest received 71 11 31
Acquisition of property, plant and
equipment (2,707) (224) (4,924)
Investments 65 (100) (510)
Other financial asset deposits 149 2,424 3,835
------------------------------------------- ------------------- ---------------- --------------
Net cash from investing activities (2,422) 2,111 (1,568)
------------------------------------------- ------------------- ---------------- --------------
Cash flows from financing activities
Proceeds from grant award 828 200 459
Capital lease obligation 601 - -
Repayment of borrowings (9,500) (9,000) (20,000)
Net cash from financing activities (8,071) (8,800) (19,541)
------------------------------------------- ------------------- ---------------- --------------
Net decrease in cash and cash equivalents (516) (848) (1,721)
Cash and cash equivalents at beginning
of the year 6,895 8,616 8,616
------------------------------------------- ------------------- ---------------- --------------
Cash and cash equivalents at end
of the year 6,379 7,768 6,895
------------------------------------------- ------------------- ---------------- --------------
Condensed consolidated statement of changes in equity
for the 6 months ended 30 September 2011
Share Share Retained Minority Total
capital premium earnings Total interest equity
--------------- ---------------- -------------- ------------- --------------- -------------
$000 $000 $000 $000 $000 $000
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 1 April 2010 60,205 317 3,342 63,864 7,659 71,523
Profit for the
period - - 3,750 3,750 885 4,635
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
Total comprehensive
income
for the period 3,750 3,750 885 4,635
Share based payment
transactions - - 37 37 - 37
At 30 September
2010 60,205 317 7,129 67,651 8,544 76,195
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 1 April 2010 60,205 317 3,342 63,864 7,659 71,523
Profit for the
period - - 6,175 6,175 1,709 7,884
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
Total comprehensive
income
for the period 6,175 6,175 1,709 7,884
Share based payment
transactions - - 106 106 - 106
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 31 March 2011 60,205 317 9,623 70,145 9,368 79,513
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 1 April 2011 60,205 317 9,623 70,145 9,368 79,513
Profit for the
period - - 2,530 2,530 775 3,305
Total comprehensive
income
for the period 2,530 2,530 775 3,305
Share based payment
transactions - - 92 92 - 92
--------------------
At 30 September
2011 60,205 317 12,245 72,767 10,143 82,910
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
Notes to Interim Statement
for the six months ended 30 September 2011
1 Basis of preparation
The interim condensed financial statements are unaudited and do
not constitute statutory financial statements within the meaning of
section 435 of the Companies Act 2006.
The comparative figures for the year ended 31 March 2011 were
derived from the statutory accounts for that year which have been
delivered to the Registrar of Companies. Those accounts received an
unqualified audit report which did not contain statements under
section 498(2) or (3) (accounting records or returns inadequate,
accounts not agreeing with records and returns or failure to obtain
necessary information and explanations) of the Companies Act
2006.
The interim condensed financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting' as adopted by
the European Union and the AIM rules of the London Stock Exchange.
This report should be read in conjunction with the Group's Annual
Report and Accounts 2011, which have been prepared in accordance
with IFRSs as adopted by the European Union.
2 Accounting Policies
The accounting policies adopted in the preparation of the
interim condensed consolidated financial statements are consistent
with those presented in the Group's Annual Report and Accounts for
the year ended 31 March 2011.
The preparation of interim financial statements requires
management to make judgments, estimates and assumptions that affect
the application of policies and reported amounts of assets and
liabilities, income and expenses. There have been no significant
changes in the bases upon which estimates have been determined
compared to those applied at 31 March 2011, and no change in
estimate has had a material effect on the current period. All
significant estimates and judgments have been disclosed in the
Group's Annual Report and Accounts for the year ended 31 March
2011. Actual results may differ from these estimates.
These condensed consolidated interim financial statements have
been prepared on the basis of IFRSs in issue that are effective at
the Company's annual reporting date as at 31 March 2012.
3 Operating segments
Managements approach to reporting the financial performance and
position of its business is as follows.
The Directors believe that the revenues achieved through the
sale of DDGS does not constitute an operating segment as defined by
applicable accounting standards. DDGS is a by-product from the
production process of ethanol and revenues are monitored
accordingly. There is no further financial information available or
presented to the Group's chief operating decision maker.
Seasonality of operations - There is no significant seasonal
nature to the Group's business of the production of ethanol.
6 months 6 months 6 months 6 months 6 months 6 months 12 months 12 months 12 months
ended ended ended ended ended ended ended ended ended
30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 Sept. 31 Mar. 31 Mar. 31 Mar.
2011 2011 2011 2010 2010 2010 2011 2011 2011
Head Head Head
IRE Office Total IRE Office Total IRE office Total
$000 $000 $000 $000 $000 $000 $000 $000 $000
Gross Revenues 180,827 - 180,827 109,159 - 109,159 261,447 - 261,447
--------- --------- --------- --------- --------- --------- ---------- ---------- ----------
Profit Before
Tax 6,017 (599) 5,418 6,876 (650) 6,226 13,234 (1,250) 11,984
--------- --------- --------- --------- --------- --------- ---------- ---------- ----------
Total Assets 195,410 8,069 203,479 202,354 7,893 210,247 200,314 7,820 208,134
--------- --------- --------- --------- --------- --------- ---------- ---------- ----------
4 Earnings per ordinary share
Basic earnings per share
The calculation of basic earnings per share at 30 September 2011
was based on the profit for the period and on the weighted average
number of ordinary shares in issue during the period.
6 months
6 months ended ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
------------------------------------- --------------------- ------------------------- -----------------------
Profit attributable to ordinary
shareholders 2,530 3,750 6,175
------------------------------------- --------------------- ------------------------- -----------------------
Weighted average number of ordinary
shares
------------------------------------- --------------------- ------------------------- -----------------------
Issued ordinary shares at 1 April 31,989 31,989 31,989
Weighted average number of ordinary
shares at 30 September or 31 March 31,989 31,989 31,989
------------------------------------- --------------------- ------------------------- -----------------------
Earnings per share $0.08 $0.12 $0.19
------------------------------------- --------------------- ------------------------- -----------------------
Diluted earnings per share
The calculation of diluted earnings per share at 30 September
2011 was based on the profit for the period and on the weighted
average number of ordinary shares outstanding after adjustment for
the effects of all dilutive potential ordinary shares.
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
--------------------- --------------------- ------------
Profit attributable to ordinary
shareholders (diluted) 2,530 3,750 6,175
------------------------------------- --------------------- --------------------- ------------
Weighted average number of ordinary
shares (basic) 1 April 31,989 31,989 31,989
Effect of share options on issue 486 429 433
---------------------
Weighted average number of ordinary
shares (diluted) at 30 September
or 31 March 32,475 32,418 32,422
------------------------------------- --------------------- --------------------- ------------
Diluted earnings per share $0.08 $0.12 $0.19
------------------------------------- --------------------- --------------------- ------------
5 Directors' emoluments
Salaries and Defined pension
Fees Taxable Benefits plan contribution Bonus Total emoluments
----------------------------- -------------------------- ---------------------------- -------------------------- ----------------------------
6 6 12 6 6 12 6 6 12 6 6 12 6 6 12
months months months months months months months months months months months months months months months
ended ended ended ended ended ended ended ended ended ended ended ended ended ended ended
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
Sept Sept March Sept Sept March Sept Sept March Sept Sept March Sept Sept March
2011 2010 2011 2011 2010 2011 2011 2010 2011 2011 2010 2011 2011 2010 2011
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
Executive
directors 163 150 325 7 6 13 6 5 10 100 70 140 276 231 488
Non -
Executive
directors 99 99 191 - - - - - - - - - 99 99 191
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
Aggregate
emoluments 262 249 516 7 6 13 6 5 10 100 70 140 375 330 679
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
The Directors of the company are deemed to be key management
personnel under applicable accounting standards.
6 Half year financial report
The condensed financial statements were approved by the Board of
Directors on 15 November 2011 and are available on the Company's
website, www.gtlresources.com. Copies are available on application
to the Company Secretary, GTL Resources PLC 107 Cheapside, London,
EC2V 6DN, UK
7 Contingencies
The lawsuit IRE brought against certain defendants in April
2009, including Fagen Inc. and IRE's previous insurance provider,
continues to progress through the Illinois State court system. In
early 2009, temporary repairs were made to the damaged concrete
silo structure at IRE to ensure continued safe corn storage and
milling. Nevertheless, since experts retained by IRE advised that
the structural integrity of the silo structure was permanently
compromised, there has been ongoing evidence of continued
deterioration, and given that the litigation's slow pace was
increasing the risk that the temporary repairs may fail, IRE
management determined that it would be prudent to advance the
construction of a replacement corn storage and milling system. The
new storage and milling facilities, which include a standalone corn
milling building and a 330,000 bushel corn storage bin, mitigate
the risk of failure and downtime by providing corn processing
capability that can function independently from the damaged
structure. The project was completed and operational as of May
2011. The project cost of $5.4 million was funded by IRE's existing
restricted cash reserves, set aside specifically for this important
risk mitigation. Management believes, however, that property damage
alone is substantially higher than the cost of this partial
solution. Complete recovery of all damages from the defendants in
the litigation is being pursued.
8 Principal risks and uncertainties
The Directors consider that the principal risks and
uncertainties which could have a material impact on the Group's
performance in the remaining six months of the financial year are
the same as the principal risks and uncertainties stated in detail
on pages 6 to 7 and 33 to 35 of our Annual Report and Accounts for
the year ended 31 March 2011 and available on our website,
www.gtlresources.com. In summary, the principal risks and
uncertainties include:
-- Volatility in market commodity margins
-- Credit Risk
-- Liquidity Risk
-- Market Risk
-- Interest Rate Risk
-- Capital Management Risk
9 Subsequent Event
On 31 October 2011, a press release was issued announcing a GTL
Board recommended offer by Sinav Limited ("Sinav" or the "Offeror")
to acquire all the shares of GTL. Prior to the announcement, Sinav
and its affiliates owned 22.66% of GTL. Highlights of the offer are
as follows:
-- Sinav will pay 100 pence in cash for all of the outstanding
shares it does not currently own, representing a 34% premium over
the 74.50 pence closing price on October 28(th) , the last day of
trading prior to the offer announcement. Current GTL shareholders,
under certain circumstances, may elect to "roll over" their shares
to retain an ownership interest in GTL.
-- The Offeror's intent is to delist GTL from the AIM exchange
in London and run the business as a private company
-- After the transaction is completed, GTL will have a new Board
of Directors and no public company expenses
-- The Offeror has indicated its intent to retain all GTL and
IRE employees to pursue GTL management's medium term strategy of
increasing production volumes and pursuing alternative revenue
streams. There are no plans to change the principal locations of
the business.
-- The transaction is expected to close in approximately two to three months
Director's responsibility statement
The Directors confirm that, to the best of their knowledge:
-- The interim set of financial statements has been prepared in
accordance with IAS 34 'Interim Financial Reporting', as adopted by
the EU; and
-- The interim management report includes a fair view of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being
an indication of important events that have occurred during the
first six months of the financial year and their impact on the
interim set of financial statements; and a description of the
principal risks and uncertainties for the remaining six months of
the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being
related party transactions that have taken place in the first six
months of the current financial year and that have materially
affected the financial performance of the entity during that
period; and any changes in the related party transactions described
in the last annual report that could do so.
The Directors of GTL Resources PLC are listed on pages 10 and 11
of the Group's Annual Report for the year ended 31 March 2011.
By order of the Board
Richard Ruebe
Company CEO
INDEPENDENT REVIEW REPORT TO GTL RESOURCES PLC
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 30 September 2011 which comprises the condensed
consolidated statement of comprehensive income, the condensed
consolidated statement of financial position, the condensed
consolidated statement of cash flows, the condensed consolidated
statement of changes in equity and the related notes. We have read
the other information contained in the half-yearly financial report
and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set
of financial statements.
This report is made solely to the company in accordance with the
terms of our engagement which includes assisting the company in
meeting the requirements of the Disclosure and Transparency Rules
("the DTR") of the UK's Financial Services Authority ("the UK
FSA"). Our review has been undertaken so that we might state to the
company those matters we are required to state to it in this report
and for no other purpose. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other than the
company for our review work, for this report, or for the
conclusions we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the AIM Rules of the London Stock Exchange.
As disclosed in note 1, the annual financial statements of the
group are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this half-yearly financial report has been prepared in
accordance with International Accounting Standard 34, "Interim
Financial Reporting," as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review.
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, "Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity" issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 30
September 2011 is not prepared, in all material respects, in
accordance with the AIM Rules of the London Stock Exchange,
International Accounting Standard 34 as adopted by the European
Union and the DTR of UK FSA.
PKF (UK) LLP
Nottingham, UK
10 November 2011
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DKKDBFBDDODD
Gtl Resources (LSE:GTL)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Gtl Resources (LSE:GTL)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024
