TIDMPXEN
RNS Number : 1389N
Prospex Energy PLC
28 September 2021
Prospex Energy Plc / Index: AIM / Epic: PXEN / Sector:
Energy
Prospex Energy Plc ('Prospex' or the 'Company')
Half Year Report
Prospex Energy Plc, the AIM quoted investment company, is
pleased to announce its Interim unaudited Results for the six
months ended 30 June 2021.
Overview:
Financial
-- GBP129,356 net profit after taxation from continuing operations (H1 2020 loss: GBP1,027,875).
-- 13.48% increase in the net book value of investments to
GBP4,109,225 (Full Year 2020: GBP3,620,890).
-- GBP488,335 gain on revaluation of investments and loans (H1 2020 loss: GBP664,949).
-- GBP417,126 administrative expenses (H1 2020: GBP416,885).
-- GBP750,000 raised via placing completed in March 2021 to fund
the Company's acquisition of a 49.9% indirect stake in the El
Romeral asset, an integrated gas production and power station
operation located in Southern Spain
Operational
-- In March 2021, the Company announced the acquisition of the
El Romeral project in southern Spain from a subsidiary of Naturgy.
This acquisition has resulted in the Company earning increasing
income throughout the year from electricity generation. Subsequent
to the end of the period, there have been significant increases in
electricity revenues with record prices being realised from the
sale of electricity.
-- In May 2021, an application was submitted to convert the
Tesorillo Project exploration permit into an exploitation
concession before Spain's Climate Change Act came into force.
-- Subsequent to the end of the period, the Company signed a
Sale & Purchase Agreement for the conditional acquisition of
20% of Podere Gallina licence in Italy. The acquisition is
conditional on the transaction being financed, which the Company is
progressing. Prospex's holding in the licence would increase from
17% to 37%. The transaction would add a further 2.7 billion cubic
feet ("Bcf") of 2P gas reserves to Prospex's portfolio, increasing
its share in Selva's 2P gas reserves to 5 Bcf. At Selva the Podere
Maiar well was successfully drilled in 2018 and this well is
expected to come into production by Q2 2022.
-- Subsequent to the end of the period, the Company approved the
budget for Tarba Energia to proceed with a well workover and data
acquisition programme on the El Romeral gas wells.
Mark Routh, CEO of Prospex, said, "Prospex has made significant
strides during the period to expand and develop its position as an
energy production and electricity generation company focussed on
Europe. This strategy is being driven by the team's deep
understanding of the upstream gas and resources industry,
experience in the jurisdictions in which we are working and also by
the positive working relationships that we have built with our
partners and the relevant authorities.
"As shareholders will be aware, the landscape for
European-focussed energy production companies has never been so
positive in terms of pricing, and whilst we appreciate that the
current pricing environment is unsustainable, we do recognise that
there remains a critical need for indigenous energy resources to be
unlocked in order to deliver accessible, reliable and affordable
energy across Europe. The team at Prospex is working judiciously
with our partners and the relevant authorities in Spain and Italy
to set a benchmark for sustainable energy production and to help
bridge this crucial energy gap alongside the proliferation of
renewable sources.
"Since taking up the position of CEO at Prospex I laid out a
clear plan for the future of the company in a detailed letter to
all shareholders at the end of August 2021 which builds on solid
foundations laid by the Company's founders.
"The Company's forward-plan and strategy is to focus on upstream
gas developments and production and electricity generation in
North-West Europe. We are an energy company, not an oil company,
with the ambition to expand our portfolio with further gas-to-power
projects and in time, blue hydrogen and other initiatives. The
Company will target appraisal and development assets not
exploration. We will be evaluating assets already in production for
acquisition at fair market value.
"Despite the recent corporate disruptions, stemming from a group
of shareholders requisitioning a General Meeting to remove the
Board, we have continued to make solid progress as evidenced from
the recent El Romeral well workover update provided to
shareholders. We expect this forward momentum to continue once the
General Meeting is resolved and I look forward to providing further
updates on both our operational and debt financing developments in
the coming weeks."
CHAIRMAN'S STATEMENT
Operational Report
The first six months of 2021 has seen key progress in both of
the Company's key investments in Italy and Spain.
In Italy, March saw the full environmental approval from Italy's
Ecological Transition Ministry for production development at the
Selva field with the final Environmental Impact Assessment ('EIA')
decree. This paves the way for the grant of a full production
licence from Italy's Economic Development Ministry. The operator,
Po Valley Energy Limited, continues to work the various strands
that support its application for a full production licence for
Selva which is currently expected in the fourth quarter of 2021.
This includes applying for an INTESA (intergovernmental agreement)
between the regional and national governments, which is a standard
development procedure for onshore gas fields in Italy.
1 March 2021 was a significant day for Tarba Energia ('Tarba'),
the Company through which Prospex holds its Spanish investments,
with the completion of the El Romeral transaction. The El Romeral
asset is a producing gas to power station selling electricity into
the Spanish grid. Therefore, Tarba has successfully transferred
from an exploration company into a production and generation
company with net income. The plant and its employees have
seamlessly transferred over to Tarba, following much preparation,
which significantly bolstered the team and broadened its
capabilities. Plant operations have been without incident and
production hours are up on the prior year under the previous
owners. Tarba, with collaboration from its shareholders has
continued to review operations, both above and below ground at El
Romeral, with the intention of increasing utilisation of the
generating capacity at the power station. There have been several
operational upgrades to the plant operation and there is ongoing
work to optimise the generation capacity. Two of the three
generators are operational, and work is planned to recommission the
third generator in preparation for increased gas production
expected from well interventions and workovers and the future
infill well drilling campaign. The first well workover on one of
the suspended wells (Rio Corbones) is planned for October. The
permitting process for the infill wells is underway.
During the period, on 22 May 2021 Spain passed its Climate
Change and Energy Transition Act 7/2021 (the "Climate Change Act").
Tarba sought advice from specialist legal advisors in the country.
Based on this advice, an application was submitted to convert the
vast majority of the existing Tesorillo Project to an exploitation
concession. This application was submitted to MITECO on 12 May 2021
together with a field development plan for approval and all of the
necessary supporting documents. The application was submitted
before the Climate Change Act came into force. The outcome of this
application will not be known for some time. Whilst the new
legalisation states that no new hydrocarbon permits or licences
will be granted in Spain, it specifically excluded existing
permits. This confirmed that applications from existing permits
prior to the Climate Change Act coming into force maintain their
validity under the new law. Tarba's application is being considered
by the regulators at a time of significantly rising prices for gas
and LNG imports in Spain, which the Board believes should work in
the Company's favour. The El Romeral exploitation concessions at
which Tarba operates its gas to power plant are in force and are
unaffected by the Climate Change Act.
The Tarba team has continued to liaise with various government
agencies to progress drilling and environmental approvals for both
El Romeral and Tesorillo. Tarba is targeting conventional sandstone
gas reservoirs. There are no financial or drilling commitments
attached to the Tesorillo Project Exploitation Concession
application.
Financial Review
For the six months ended 30 June 2021, the Company is reporting
a net profit after taxation from continuing operations of
GBP129,356 (H1 2020: loss - GBP1,027,875). Unrealised gains arising
on revaluation of financial assets at fair value totalled
GBP488,335 (H1 2020: loss - GBP664,949). These unrealised gains are
dominated by a revaluation of the Company's share in its subsidiary
PXOG Marshall (in which the assets in the Podere Gallina licence in
Italy are held), where the underlying licence valuation has been
updated to reflect positive changes in the forward curve of
European gas prices.
Administrative expenses of GBP417,126 for the year-to-date,
compares with GBP416,885 for the six- month period ended 30 June
2020.
In March 2021, the Company raised GBP750,000 gross via an
oversubscribed placing primarily to fund the planned programmes at
El Romeral and the Podere Gallina licence.
In June the 2021 Company refinanced 83% of its outstanding 2018
Loan Notes. GBP321,681 of the then GBP386,017 outstanding loan
notes were rolled over into the 2021 Loan note instrument, whilst
increasing the interest rate to 12% the repayment dates have been
extended by 18 months.
At 30 June 2021, the Company held cash and cash equivalents of
GBP458,591 (30 June 2020: GBP170,866)
Outlook
The outlook for Prospex is one of consolidation and growth. With
a shortage of gas across Europe, markets are experiencing record
high gas and electricity prices. These prices are unlikely to be
sustainable longer term. The drive to convert energy supply towards
renewable energy sources must continue but cannot be achieved
quickly. Local indigenous onshore gas is the optimum energy source
to fulfil the energy gap whilst the transition to renewables gains
pace. Prospex is well positioned to grow its business into this
undeniable market opportunity, while using the strength of our team
and our assets to invest in appropriate alternative energy
sources
Following the Annual General Meeting of shareholders, the team
leading your company has changed with Mark Routh becoming CEO and a
director and Alasdair Buchanan joining as an additional
non-executive director. These two individuals bring a significant
depth of experience to the Board and management and have a thorough
understanding of the existing assets and joint venture partners as
well as bringing skills and experience to implementing new
opportunities. Ed Dawson, former Managing Director and a founder of
the company was instrumental in building the asset base of the
Company to what it is today - a strong platform to build upon in
Italy and Spain. James Smith, a former director, contributed
technical strength and governance experience to the Board. I would
like to extend my thanks to these individuals for the considerable
work they put in to establishing the strong platform for growth
that we now have.
Bill Smith
Non-Executive Chairman
For further information visit www.prospex.energy or contact the
following:
Mark Routh Prospex Energy PLC Tel: +44 (0) 20 7236
1177
Rory Murphy Strand Hanson Limited Tel: +44 (0) 20 7409
Ritchie Balmer 3494
Colin Rowbury Novum Securities Limited Tel: +44 (0) 20 7399
Jon Belliss 9427
Duncan Vasey Peterhouse Capital Limited Tel: +44 (0) 20 7220
9797
Susie Geliher St Brides Partners Ltd Tel: +44 (0) 20 7236
Catherine Leftley 1177
Prospex Energy Plc
Interim results
For the six months ended 30 June 2021
Statement of profit or loss and other comprehensive income
Six months Six months
ended ended Year ended
30 June 30 June 31 December
------------------------------ ----------------------- -------------------------
2021 2020 2020
(unaudited) (unaudited) (audited)
GBP GBP GBP
CONTINUING OPERATIONS
Other income 61,335 136,292 247,143
Administrative expenses (417,126) (416,885) (870,018)
Share-based payment charge - (102,175) (102,175)
------------------------------ ----------------------- -------------------------
OPERATING LOSS (355,791) (382,768) (725,050)
Gain/(loss) on revaluation
of investments and loans 488,335 (664,949) (1,121,815)
------------------------------ ----------------------- -------------------------
132,544 (1,047,717) (1,846,865)
Finance income 50,093 47,334 91,362
Finance costs (53,281) (27,492) (50,989)
-------------------------- ----------------------- -------------------------
PROFT/(LOSS) BEFORE INCOME
TAX 129,356 (1,027,875) (1,806,492)
Income tax - - -
-------------------------- ----------------------- -------------------------
PROFIT/(LOSS) AND TOTAL
COMPREHENSIVE
LOSS FOR THE PERIOD 129,356 (1,027,875) (1,806,492)
========================== ======================= =========================
Earnings/(loss) per share
- Basic and diluted 0.11p (1.24)p (2.10)p
========================== ======================= =========================
Statement of financial position
As at 30 June 2021
30 June 30 June 31 December
-------------------------- ------------------------ --------------------------
2021 2020 2020
(unaudited) (unaudited) (audited)
GBP GBP GBP
ASSETS
NON-CURRENT ASSETS
Property, plant and
equipment - - -
Investment 4,109,225 3,983,439 3,620,890
Loans and other financial
assets - 359,717 -
Trade and other receivables 1,058,766 921,643 989,645
5,167,991 5,264,799 4,610,535
-------------------------- ------------------------ --------------------------
CURRENT ASSETS
Trade and other receivables 921,364 766,662 917,058
Cash and cash equivalents 458,591 170,866 220,618
-------------------------- ------------------------ --------------------------
1,379,955 937,528 1,137,676
-------------------------- ------------------------ --------------------------
TOTAL ASSETS 6,547,946 6,202,327 5,748,211
========================== ======================== ==========================
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 7,085,589 7,035,589 7,035,589
Share premium account 10,855,416 10,185,819 10,185,819
Capital redemption reserve 43,333 43,333 43,333
Merger reserve 2,416,667 2,416,667 2,416,667
Retained earnings (14,835,674) (14,186,413) (14,965,030)
-------------------------- ------------------------ --------------------------
TOTAL EQUITY 5,565,331 5,494,995 4,716,378
-------------------------- ------------------------ --------------------------
LIABILITIES
NON-CURRENT LIABILITIES
Financial liabilities -
borrowings
Bank loans 40,195 49,632 -
Interest bearing loans and
borrowings 321,680 265,848 579,998
-------------------------- ------------------------ --------------------------
361,875 315,480 579,998
-------------------------- ------------------------ --------------------------
CURRENT LIABILITIES
Trade and other payables 152,574 143,011 164,262
Financial liabilities -
borrowings
Bank loans 9,437 - -
Interest bearing loans and
borrowings 458,729 248,841 287,573
-------------------------- ------------------------ --------------------------
620,740 391,852 451,835
-------------------------- ------------------------ --------------------------
TOTAL LIABILITIES 982,615 707,332 1,031,833
-------------------------- ------------------------ --------------------------
TOTAL EQUITY AND LIABILITIES 6,547,946 6,202,327 5,748,211
========================== ======================== ==========================
Statement of changes in equity
For the six months ended 30 June 2021
Capital
Share Share Retained redemption Merger
capital premium earnings reserve reserve Total
GBP GBP GBP GBP GBP GBP
Unaudited
At 1 January
2021 7,035,589 10,185,819 (14,965,030) 43,333 2,416,667 4,716,378
Total
comprehensive
income
for the period - - 129,356 - - 129,356
Issue of shares 50,000 700,000 - - - 750,000
Costs in
respect of
shares
issued - (54,900) - - - (54,900)
Equity settled
share-based
payment - 24,497 - - - 24,497
At 30 June 2021 7,085,589 10,855,416 (14,835,674) 43,333 2,416,667 5,565,331
========================== ======================== ========================== ======================= =================== =============
Unaudited
At 1 January
2020 6,435,587 10,095,358 (13,260,713) 43,333 2,416,667 5,730,232
Total
comprehensive
income
for the period - - (1,027,875) - - (1,027,875)
Issue of shares 600,002 119,998 - - - 720,000
Costs in
respect of
shares
issued - (29,537) - - - (29,537)
Equity settled
share-based
payment - - 102,175 - - 102,175
At 30 June 2020 7,035,589 10,185,819 (14,186,413) 43,333 2,416,667 5,494,995
========================== ======================== ========================== ======================= =================== =============
Audited
At 1 January
2020 6,435,587 10,095,358 (13,260,713) 43,333 2,416,667 5,730,232
Total
comprehensive
income
for the year - - (1,806,492) - - (1,806,492)
Issue of shares 600,002 119,998 - - - 720,000
Costs in
respect of
shares
issued - (29,537) - - - (29,537)
Equity settled
share-based
payments - - 102,175 - - 102,175
At 31 December
2020 7,035,589 10,185,819 (14,965,030) 43,333 2,416,667 4,716,378
========================== ======================== ========================== ======================= =================== =============
Statement of Cash Flows
For the six months ended 30 June 2021
Six months Six months
ended ended Year ended
30 June 30 June 31 December
--------------------------- --------------------------- ----------------------
2021 2020 2020
(unaudited) (unaudited) (audited)
GBP GBP GBP
Operating activities
Profit/(loss )before income
tax 129,356 (1,027,875) (1,806,492)
(Gain)/loss on revaluation
of investments and loans (488,335) 664,949 377,498
Provision against loan to
subsidiary undertaking - - 744,317
Finance income (50,093) (47,334) (91,362)
Finance costs 53,281 27,492 50,989
--------------------------- --------------------------- ----------------------
Operating loss (355,791) (382,768) (725,050)
Increase in trade and other
receivables (23,334) (415,834) (590,204)
(Decrease)/increase in trade
and other payables (11,688) 41,824 67,968
Share-based payment charge 24,497 102,175 102,175
Issue of loan notes to settle
liabilities - - 38,250
--------------------------- --------------------------- ----------------------
Net cash used in operating
activities (366,316) (654,603) (1,106,861)
--------------------------- --------------------------- ----------------------
Investing activities
Interest paid (53,281) (23,274) (51,664)
--------------------------- ---------------------------
Net cash used in from
investing
activities (53,281) (23,274) (51,664)
--------------------------- --------------------------- ----------------------
Financing activities
New loan notes in period - - 265,000
New bank loans in period - 49,632 49,632
Loan (payments)/repayments
in period (37,530) 39,261 304,661
Issue of share capital 750,000 720,000 720,000
Costs in respect of share
issue (54,900) (29,537) (29,537)
Net cash generated from
financing
activities 657,570 779,356 1,309,756
--------------------------- --------------------------- ----------------------
Net increase in cash and cash
equivalents 237,973 101,479 151,231
Cash and cash equivalents
at start of period 220,618 69,387 69,387
--------------------------- --------------------------- ----------------------
Cash and cash equivalents
at end of period 458,591 170,866 220,618
=========================== =========================== ======================
Notes to the interim financial statements
1 General information
Prospex Energy Plc is a company incorporated in the United
Kingdom, which is listed on the Alternative Investment Market of
the London Stock Exchange Plc. The address of its registered office
is Stonebridge House, Chelmsford Road, Hatfield Heath, Essex CM22
7BD. The Group is primarily involved in the exploration for, and
the production of, natural gas.
2 Financial information
The interim financial information for the six months ended 30
June 2021 and 2020 have not been audited or reviewed and do not
constitute statutory accounts within the meaning of Section 434 of
the Companies Act 2006. The comparative financial information for
the year ended 31 December 2020 has been derived from the audited
financial statements for that period. A copy of those statutory
financial statements for the year ended 31 December 2020 has been
delivered to the Registrar of Companies. The report of the
independent auditors on those financial statements was unqualified,
drew attention to a material uncertainty relating to going concern
and did not contain a statement under Sections 498 (2) or (3) of
the Companies Act 2006.
The interim financial statements have been prepared in
accordance with International Accounting Standards in conformity
with the requirements of the Companies Act 2006 as they apply to
the financial statements of the Company for the six months ended 30
June 2021 and as applied in accordance with the provisions of the
Companies Act 2006 and under the historical cost convention or fair
value where appropriate. They have also been prepared on a basis
consistent with the accounting policies expected to be applied for
the year ending 31 December 2021 and which are also consistent with
those set out in the statutory accounts of the Company for the year
ended 31 December 2020.
The interim financial statements are presented in pounds
sterling because that is the currency of the primary economic
environment in which the company operates.
3 Taxation
On the basis of these accounts there is no tax charge for the
period.
4 Earnings/loss per share
The profit/loss and number of shares used in the calculation of
earnings per share are as follows:
Six months Six months
ended ended Year ended
30 June 30 June 31 December
------------- ------------- ---------------
2021 2020 2020
(unaudited) (unaudited) (audited)
Basic and diluted
Profit/(loss) for the financial
period 129,356 (1,027,875) (1,806,492)
Weighted average number of
shares 116,168,109 83,137,132 85,855,239
Loss per share 0.11p (1.24)p (2.10)p
============= ============= ===============
The profit/loss and the weighted average number of shares used
for calculating the diluted loss per share are identical to those
for the basic loss per share. The exercise prices of the
outstanding share options and share warrants are above the average
market price of the shares and would therefore not be dilutive
under IAS 33 'Earnings per Share.'.
5 Non-current investment
Shares in
Group Unlisted
undertakings investments Totals
GBP GBP GBP
Unaudited
At 1 January 2021 3,570,890 50,000 3,620,890
Revaluations 488,335 - 488,335
At 30 June 2021 4,059,225 50,000 4,109,225
================= ======================== ================
Unaudited
At 1 January 2020 3,948,388 50,000 3,998,388
Revaluations (14,949) - (14,949)
At 30 June 2020 3,933,439 50,000 3,983,439
================= ======================== ================
Audited
At 1 January 2020 3,948,388 50,000 3,998,388
Revaluations (377,498) - (377,498)
At 31 December 2020 3,570,890 50,000 3,620,890
================= ======================== ================
The investments in subsidiary undertakings are accounted for at
fair value through the profit and loss, as the Company is deemed to
be an Investment Entity.
6 Dividends
The directors do not propose to declare a dividend for the
period.
7 Copies of interim results
Copies of the interim results can be obtained from the website
www.prospex.energy . From this site you may access our financial
reports and presentations, recent press releases and details about
the company and its operations.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR FFFLIADIDFIL
(END) Dow Jones Newswires
September 28, 2021 02:00 ET (06:00 GMT)
Prospex Oil And Gas (LSE:PXOG)
Gráfica de Acción Histórica
De Feb 2024 a Mar 2024
Prospex Oil And Gas (LSE:PXOG)
Gráfica de Acción Histórica
De Mar 2023 a Mar 2024