REG - Ascent Resources PLC - Audited Final Results <Origin Href="QuoteRef">ASCR.L</Origin> - Part 3
24/04/2017 07:06
- Part 3: For the preceding part double click ID:nRSX0561Db
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Fair value of new loan notes issued in November 2016 (vii) 690 -
Convertible notes drawn in the period (ii) - 500
Modification to existing notes - de-recognition February 2015 (iii) - (9,983)
Modification to existing notes - recognition of amended note - February 2015 (iii) - 8,829
EnQuest debt liability restructured into loan notes (iv) - 2,038
Modification to existing notes - de-recognition November 2015 (v) - (12,021)
Modification to existing notes - recognition of amended note - November 2015 (v) - 10,449
Converted notes (ix) (3,745) (4)
Other movements (153) -
Liability at 31 December 6,162 10,778
There were several transactions during 2015 & 2016 in relation to CLNs:
(i) Background
The Group issued £5 million of 9 per cent 2013 CLNs during 2012 and 2013,
convertible at any time at the discretion of the holder, into Ordinary Shares
at 200 Ordinary Shares per £1 principal of loan note, an effective conversion
price of between 0.1p and 0.5p per Ordinary share depending on whether the
balance could be sold to independent third party investors. The CLNs were due
to mature in January 2015.
On 5 February 2014, the Group agreed with Henderson to create a new £5 million
class of 9 per cent CLNs with a maturity date of December 2014, convertible at
any time at the discretion of the holder, into Ordinary Shares at 100 Ordinary
Shares per £1 principal of loan note, an effective conversion price of 1 pence
per Ordinary share. The first £2 million available under these 2014 CLNs was
drawn immediately with the balance intended for sale to independent third
party investors, with the intention that the pricing of all the 2014 CLNs
would be reset to the lowest price paid by these new investors.
(ii) Variation of terms in 2014
On 8 September 2014, by when it had become clear that it would not be possible
to secure investment from new third party subscribers for the £3 million
balance outstanding under the 2014 CLNs, the Company agreed with Henderson to
vary the terms of the 2014 CLNs whereby Henderson agreed to subscribe for a
further £2 million in principal of 2014 CLNs convertible into Ordinary Shares
at 500 Ordinary Shares per £1 principal of loan note, an effective conversion
price of 0.2p. Additionally, Henderson was granted security in the form of a
charge over the Company's assets. The variation to the loan note terms was
considered to be an inducement to convert and resulted in a one-off charge to
the income statement of £2,520,000 in 2014. The Company drew £1.5 million
between September and December 2014. At 31 December 2014, the carrying value
of the loan notes stood at £9,624,000. On 5 February 2015, the Company drew
the final £500,000 available under the loan notes.
(iii) First variation of terms in 2015
On 19 February 2015, the shareholders and note holders approved the variation
of the terms on the 2013 and 2014 CLNs. In total £5 million had been drawn
under the 2013 CLNs and £4 million had been drawn under the 2014 CLNs;
including accrued interest some £10 million was due for repayment, in part on
23 December 2014 and in part on 31 January 2016. In return for extending the
maturity date of the CLNs to 19 November 2015 and terminating the accrual of
further interest, the Board of Ascent agreed to adjust the conversion price in
respect of both the 2013 and 2014 CLNs from 0.5p and 0.2p respectively to 0.1p
(pre-share consolidation) for all loan notes. The 2013 and 2014 CLNs were
extinguished and replaced with the amended convertible loan. On initial
recognition, the liability and equity element of the CLNs were fair valued.
As part of this transaction, a loss on extinguishment of £856,000 was
recognised as a finance cost as the loan note holder was considered to be
acting in its capacity as a debt holder. The loan was recognised at a
discount rate of 15% and the interest charge accretes over the loan period.
(iv) EnQuest convertible loan note
On 9 July 2015, the Company agreed to restructure other payables due to
EnQuest as deferred consideration on the acquisition of their 48.75% interest
in the Petišovci project in 2010. In total £3,024,000 was due to be payable
to EnQuest on 19 December 2015. As at July 2015, the liability stood at
£2,779,000 and would have accreted this up to the full amount payable during
the year had this restructuring not occurred. The entire debt payable was
restructured into a £2,038,000 convertible loan note. The terms of these CLNs
are identical to the £4 million of notes issued in 2015 to Henderson and
benefit from security over the Company's shareholding in Ascent Slovenia
Limited which owns an interest in the Petišovci concession. On initial
recognition, the liability and equity element of the CLNs were fair valued.
The loan was recognised at a discount rate of 15% and the interest charge
accretes over the loan period. The extinguishment of the previous liability
gave rise to a £741,000 gain recorded in finance income as EnQuest was
considered to be acting in its capacity as a debt holder.
(v) Second variation of loan note terms in 2015
In November 2015, prior to the notes falling due for repayment, the holders of
the CLNs agreed to extend the maturity to 19 November 2016 in exchange for the
conversion price being rebased from 0.1 pence to 0.05 pence. The carrying
value of the CLN liabilities at 19 November 2015 was £12,021,000. The CLNs
were extinguished and replaced with amended convertible loans. On initial
recognition, the liability and equity element of the CLNs were fair valued.
The loans were recognised at a discount rate of 15% (equating to £10,449,000)
and the interest charge will accrete over the loan period.
The fair value attributable to the equity portion were recorded in equity
(£1,572,000), representing the fair value of the conversion option and the
difference between the previous and new liability which represented a capital
contribution by shareholders as the loan note holders were considered to be
acting in their capacity as shareholders. The loan amount was convertible at
any time into ordinary shares of the Company.
Unlike the previous position in relation to the 2013 and 2015 CLN's the notes
are no longer subject to a waiver of the provisions of Rule 9 of the City Code
on Takeovers and Mergers. Accordingly, if Henderson or any other holder of
the 2013 and 2015 CLN's exercise their right of conversion and they hold equal
to or more than 30 per cent of the total voting rights of the Company, such
holder will be required to make a mandatory bid for the remaining ordinary
shares in the capital of the Company not held by them.
(vi) Capital reorganisation - November 2015
On 30 November 2015 shareholders approved a placing, amendment to convertible
loan note terms and a capital reorganisation. The capital reorganisation
reduced the nominal share price from 0.1 pence to 0.01 pence and subsequently
to consolidate ordinary shares by a factor of 20 thereby increasing the
nominal share price to 0.2 pence. The conversion price on the loan notes was
similarly adjusted by a factor of 20 to 1 pence.
(vii) Issue of loan notes pursuant to the placing - November 2016
On 27 October 2016 shareholders approved a placing which included the issuance
of £1,050,000 of new convertible loan notes ('The 2016 CLN's'), £50,000 of
which were subscribed for by the Directors of the Company. The notes were to
be on identical terms to the 2013 & 2014 CLNs.
On initial recognition, the liability and equity element of the CLNs have been
fair valued. The loans have been recognised at a discount rate of 15%
(equating to £690,000) and the interest charge will accrete over the loan
period.
The fair value attributable to the equity portion has been recorded in equity
(£360,000), representing the fair value of the conversion option. The loan
amount is convertible at any time into ordinary shares of the Company,
£1million of which was converted post period end.
(viii) Variation of loan note terms in 2016
In November 2016, prior to the notes falling due for repayment, the holders of
the CLNs agreed to extend the maturity to 19 November 2019 with no adjustment
to the conversion price or any other terms. The carrying value of the CLN
liabilities at 19 November 2016 was £8,140,000. The CLNs were extinguished
and replaced with amended convertible loans. On initial recognition, the
liability and equity element of the CLNs have been fair valued. The loans
have been recognised at a discount rate of 15% (equating to £5,352,000) and
the interest charge will accrete over the loan period.
The Directors consider that the carrying amount of the loans approximates to
their fair value. The weighted average coupon interest rate of the
convertible loan is 0% as interest ceased to accrue on the convertible notes
in January 2015.
The fair value attributable to the equity portion has been recorded in equity
(£2,788,000) representing the fair value of the conversion option. The loan
amount is convertible at any time into ordinary shares of the Company.
The notes are not subject to a waiver of the provisions of Rule 9 of the City
Code on Takeovers and Mergers. Accordingly, if Henderson or any other holder
of the 2013 and 2015 CLN's exercise their right of conversion and the hold
equal to or more than 30 per cent of the total voting rights of the Company,
such holder will be required to make a mandatory bid for the remaining
ordinary shares in the capital of the Company not held by them.
(ix) Conversions
There were a number of loan note conversions carried out during the periods:
2016 2016 2015 2015
Notes converted (including rolled up interest) Shares issued Notes converted (including rolled up interest) Shares issued
January - - - -
February - - - -
March - - 139 138,520
April 1,088,390 108,838,990 473 473,030
May 463,113 46,311,258 - -
June 1,273,923 127,392,263 - -
July - - 244 244,392
August 845,053 84,505,321 - -
September 563 56,312 2,747 2,746,912
October - - - -
November 73,455 7,345,491 - -
December 357 35,702 1,014 101,362
Total 3,744,853 374,485,337 4,616 3,704,216
(x) £7 million short- term funding facility
On 12 May 2015, the Company announced that it had agreed a £7 million loan
facility (the 'Loan') for general corporate purposes with Henderson. The Loan
was capable of being drawn at any time from signing to 30 June 2016 at the
discretion of Henderson.
The Loan accrued interest at the rate of 7.5% per annum on the amount drawn
and this was added to the amount of the Loan. The Loan was subject to a
drawdown fee of 1.75% per tranche which was deducted from the funds advanced.
The Loan was also subject to a repayment fee of 1.25% on any amounts repaid by
the Company. The balance outstanding was repayable on demand at any time.
As at 31 December 2015 the Company had drawn £450,000 from the facility on
which £11,000 of interest had accrued; a further £250,000 was drawn from this
facility during January 2016 and another £100,000 during March 2016.
In November 2016 following the approval of a placing by shareholders at a
general meeting the outstanding balance of £871,510 was repaid in full. This
consisted of £800,000 principal, £61,510 of accrued interest and a £10,000
repayment fee.
14 Provisions - Group
£000s
At 1 January 2015 410
Foreign exchange movement (24)
At 31 December 2015 386
At 1 January 2016 386
Foreign exchange movement 61
At 31 December 2016 447
The amount provided for decommissioning costs represents the Group's share of
site restoration costs for the Petišovci field in Slovenia. The most recent
estimate is that the year-end provision will become payable after 2022.
15 Trade and other payables - Group
2016 2015
£ '000s £ '000s
Trade payables 147 166
Tax and social security payable 10 22
Other payables - 152
Accruals and deferred income 97 168
254 508
16 Trade and other payables - Company
2016 2015
£ '000s £ '000s
Trade payables 84 114
Tax and social security payable 10 22
Other Payables - 152
Accruals and deferred income 70 130
164 418
17 Called up share capital
2016 2015
£ '000s £ '000s
Authorised
10,000,000,000 ordinary shares of 0.2pence each 10,000 10,000
Allotted, called up and fully paid
1,084,074,224 (2015: 157,306,900) ordinary shares of 0.2 pence each (2015: 0.2p each) and 1,737,110,494 (2015: 1,737,110,494) deferred shares of 0.09p each 3,732 1,878
Reconciliation of share capital movement 2016 2015
Number Number
At 1 January 157,306,900 1,458,507,909
Capital Reorganisation - (1,650,255,225)
Loan note conversions 374,485,337 3,704,216
Placings
April 35,714,294 -
May - 275,000,000
June 166,666,666 -
October & November 349,901,027 70,350,000
At 31 December 1,084,074,224 157,306,900
Shares issued during the year
There were a number of conversion requests processed during the year; for the
details please see Note 13.
The Company also raised funds through placings during the year:
· On 12 April 2016, the Company raised £500,000 (£477,500 net of costs)
via the Placing of 35,714,285 Ordinary Shares with investors using the
PrimaryBid.com platform.
· On 7 June 2016, the Company raised £500,000 (£477,500 net of costs) via
the Placing of 83,333,333 Ordinary Shares with investors using the
PrimaryBid.com platform.
· On 15 June 2016, the Company raised £500,000 (£500,000 net of costs)
via the Placing of 83,333,333 Ordinary Shares to Henderson Global Investors.
· On 31 October 2016, the Company raised £2,627,500 (£2,402,434 net of
costs) via the Placing of 262,750,000 Ordinary Shares.
· On 7 November 2016, the Company raised £871,510 (£871,510 net of costs)
via the Placing of 87,151,027 Ordinary Shares to Henderson Global Investors.
Shares issued during the prior year
There were a number of conversion requests processed during the prior year;
for the details please see Note 13.
The Company also raised funds through placings during the prior year:
· In May 2015, the Company raised £550,000 (£525,250 net of costs) via
the Placing of 275,000,000 Ordinary Shares with investors using the
PrimaryBid.com platform.
· In November 2015, the Company raised £703,000 (£671,843 net of costs)
via the Placing of 70,350,000 Ordinary Shares with investors using the
PrimaryBid.com platform.
Reserve description and purpose
The following describes the nature and purpose of each reserve within owners'
equity:
· Share capital: Amount subscribed for share capital at nominal value.
· Equity reserve: Amount of proceeds on issue of convertible debt
relating to the equity component and contribution on modification of the
convertible loan notes, i.e. option to convert the debt into share capital.
· Share premium: Amounts subscribed for share capital in excess of
nominal value less costs of shares associated with share issues.
· Share-based payment reserve: Value of share options granted and
calculated with reference to a binomial pricing model. When options lapse or
are exercised, amounts are transferred from this account to retained
earnings.
· Translation reserve: Exchange movements arising on the retranslation
of net assets of operation into the presentation currency.
· Accumulated losses: Cumulative net gains and losses recognised in
consolidated income.
18 Operating lease arrangements
At the balance sheet date, the Group had no outstanding commitments under
non-cancellable operating leases (2015: £nil).
19 Exploration expenditure commitments
In order to maintain an interest in the oil and gas permits in which the Group
is involved, the Group is committed to meet the conditions under which the
permits were granted and the obligations of any joint operating agreements.
The timing and the amount of exploration expenditure commitments and
obligations of the Group are subject to the work programmes required as per
the permit commitments. This may vary significantly from the forecast
programmes based upon the results of the work performed. Drilling results in
any of the projects may also cause variations to the forecast programmes and
consequent expenditure. Such activity may lead to accelerated or decreased
expenditure. It is the Group's policy to seek joint operating partners at an
early stage to reduce its commitments.
At 31 December 2016, the Group had exploration and expenditure commitments of
£ Nil (2015 - Nil).
20 Related party transactions
a. Group companies - transactions
2016 2016 2015 2015
Cash Services Cash Services
Ascent Slovenia Limited 541 183 840 -
Ascent Resources doo 275 212 318 344
816 395 1,158 344
b. Group companies - balances
2016 2016 2015 2015
Cash Services Cash Services
Ascent Slovenia Limited 16,690 3,175 13,445 2,572
Ascent Resources doo 2,369 1,735 1,790 1,301
19,329 4,910 15,235 3,873
c. Directors
Key management are those persons having authority and responsibility for
planning, controlling and directing the activities of the Group. In the
opinion of the Board, the Group's key management are the Directors of Ascent
Resources plc. Information regarding their compensation is given in Note 4.
2016
In October 2016, the Directors subscribed for £50,000 of convertible loan
notes in connection with the Placing which raised £4.5 million (£3.5 million
equity and £1m convertible loan notes) before costs. Clive Carver, Cameron
Davies and Nigel Moore subscribed for £13,333 each with Colin Hutchinson
subscribing for £10,001.
Clive Carver is a director of Darwin Strategic Limited, which is the owner of
PrimaryBid through which the Company raised £1.0 million in equity during
2016. Refer to Note 17 for further share issues.
2015
Clive Carver is a director of Darwin Strategic Limited, which is the owner of
PrimaryBid through which the Company raised £1.2 million in equity during
2016. Refer to Note 17 for further share issues.
d. Henderson Global Investors
· Advanced £350,000 under the short-term loan facility during January and
March 2016.
· Converted loan notes with a face value of £3,137,068 during the year
into 434,297,145 Ordinary Shares.
· Subscribed £500,000 for 83,333,333 shares in June 2016.
· Subscribed £500,000 for 83,333,333 shares in June 2016.
· Subscribed £1,000,000 for 100,000,000 shares in October 2016.
· Subscribed £871,510 for 87,151,027 shares in November 2016.
· In November 2016, the Company repaid in full the balance of £871,150
due under the £7 million facility as described in Note 13.
· Henderson Global Investors provided £450,000 of short-term working
capital funding in 2015
21 Events subsequent to the reporting period
Recompletion of Pg-10
On 30 January 2017, the Company announced that it had recompleted well Pg-10
and the well had flowed at a peak stabilised rate of 8.8 mmscfd.
Placing on PrimaryBid
On 13 February 2017, the Company announced that it had raised £2,987,750
(£2,838,363 net of costs) through an underwritten offer using the
PrimaryBid.com platform. The fundraise included a subscription for 270,270
shares by Colin Hutchinson, Chief Executive. On 16 February 161,500,000 new
ordinary shares were issued and admitted to trading.
Conversion of loan notes
Since the year end a total of £4,065,607 of convertible loan notes have been
converted into 424,912,491 ordinary shares.
22 Share based payments
The Company has provided the Directors, certain employees and institutional
investors with share options and warrants ('options'). Options are
exercisable at a price equal to the closing market price of the Company's
shares on the date of grant. The exercisable period varies and can be up to
seven years once fully vested after which time the option lapses.
The share options below have been rebased following the capital reorganisation
which was completed during 2016. All options have been adjusted by a factor
of 20. The comparatives have been restated to show like for like.
Details of the share options outstanding during the year are as follows:
Shares Weighted Average price (pence)
Outstanding at 1 January 2016 5,935,738 16.88
Granted during the year 78,828,006 1.58
Expired during the year (250,000) 170.00
Outstanding at 31 December 2016 84,513,744 2.94
Exercisable at 31 December 2016 13,185,738 20.00
Outstanding at 1 January 2015 6,710,738 39.62
Expired during the year (775,000) 207.58
Outstanding at 31 December 2015 5,935,738 24.07
Exercisable at 31 December 2015 250,000 170.00
The value of the options is measured by the use of a binomial pricing model.
The inputs into the binomial model made in 2016 were as follows:
Share price at grant date 1.32p - 1.54p
Exercise price 1.54p - 2.00p
Volatility 50%
Expected life 3-5 years
Risk free rate 0.5%
Expected dividend yield 0%
Expected volatility was determined by calculating the historical volatility of
the Group's share price over the previous 5 years. The expected life is the
expiry period of the options from the date of issue.
Options outstanding at 31 December 2016 have an exercise price in the range of
1.58p and 20p (31 December 2015: 20p and 240p) and a weighted average
contractual life of 9.1 years (31 December 2015: 7.0 years).
Trameta acquisition
During the year, the Company acquired Trameta doo which owned land and access
rights over the export pipeline. Consideration for the transaction was 75
million ordinary shares which vest in four tranches on the one year
anniversary of various conditions being met. An option over a further 7.5
million ordinary shares at an exercise price of 2pence is valid for three
years from November 2016 when the second condition was met.
The 75 million shares have been valued using the Black-Scholes model under the
assumption that 100% of the shares will vest as management expects all four of
the vesting criteria to be successfully achieved. The conditions have been
met for the first two tranches, being completion of the SPA and certification
of the pipeline.
The value of the options is measured by the use of a binomial pricing model.
The inputs into the binomial model in respect of the Trameta consideration
shares were as follows:
Share price at grant date 1.425p
Exercise price Nil
Volatility 101% - 130%
Expected life 1 -3 years
Risk free rate 1.75%
Expected dividend yield 0%
Expected volatility was determined by calculating the historical volatility of
the Group's share price over the previous comparable periods. The expected
life is the expiry period of the options from the date of issue.
The value of the shares and options was £1.1 million which has been recognised
as an addition to exploration and evaluation costs, see note 8.
23 Financial risk management
Group and Company
The Group's financial liabilities comprise CLNs, other loans and trade
payables. All liabilities are measured at amortised cost. These are detailed
in Notes 13, 15 and 16.
The Group has various financial assets, being trade receivables and cash,
which arise directly from its operations. All are classified as loans and
receivables. These are detailed in Notes 10 and 11.
The main risks arising from the Group's financial instruments are credit risk,
liquidity risk and market risk (including interest risk and currency risk).
The risk management policies employed by the Group to manage these risks are
discussed below:
a. Credit risk
Credit risk refers to the risk that a counterparty will default on its
contractual obligations resulting in financial loss to the Group.
The Group does not have any significant credit risk exposure.
The Group makes allowances for impairment of receivables where there is an
identified event which, based on previous experience, is evidence of a
reduction in the recoverability of cash flows.
The credit risk on liquid funds (cash) is considered to be limited because the
counterparties are financial institutions with high and good credit ratings
assigned by international credit rating agencies in the UK.
The carrying amount of financial assets, trade receivables and cash held with
financial institutions recorded in the financial statements represents the
exposure to credit risk for the group.
At Company level, there is the risk of impairment of intercompany receivables
if the full amount is not deemed as recoverable from the relevant subsidiary
company. These amounts are written down when their deemed recoverable amount
is deemed less than the current carrying value.
b. Market risk
(i) Currency risk
Currency risk refers to the risk that fluctuations in foreign currencies cause
losses to the Company.
The Group's operations are predominantly in Slovenia. Foreign exchange risk
arises from translating the euro earnings, assets and liabilities of the
Ascent Resources doo and Ascent Slovenia Limited into sterling. The Group
manages exposures that arise from receipt of monies in a non-functional
currency by matching receipts and payments in the same currency.
The Company often raises funds for future development through the issue of new
shares in sterling. These funds are predominantly to pay for the Company's
exploration costs abroad in Euros. As such any sterling balances held are at
risk of currency fluctuations and may prove to be insufficient to meet the
Company's planned euro requirements if there is devaluation.
Foreign currency sensitivity analysis
The Group is mainly exposed to the currency of the European Union (the euro).
The Group operates internationally and is exposed to currency risk on sales,
purchases, borrowings and cash and cash equivalents that are denominated in a
currency other than sterling. The currencies giving rise to this are the euro
and the United States dollar.
Foreign exchange risk arises from transactions and recognised assets and
liabilities.
The Group does not use foreign exchange contracts to hedge its currency risk.
Sensitivity analysis
The following table details the Group's sensitivity to a 10% increase and
decrease in sterling against the stated currencies. 10% is the sensitivity
rate used when reporting foreign currency risk internally to key management
personnel and represents the management's assessment of the reasonably
possible change in foreign exchange rates. The sensitivity analysis comprises
cash and cash equivalents held at the balance sheet date. A positive number
below indicates an increase in profit and other equity where sterling weakens
10% against the relevant currency.
Euro currency change US$ Currency change
Year ended31 December 2016 Year ended 31 December 2015 Year ended 31 December 2016 Year ended 31 December 2015
Group £000s £000s £000s £000s
Profit or loss
10% strengthening of sterling 47 89 2 2
10% weakening of sterling (58) (109) (2) (2)
Equity
10% strengthening of sterling (1,983) (1,616) (3) -
10% weakening of sterling 2,424 1,976 4 -
Company
Profit or loss
10% strengthening of sterling (13) (4) 2 2
10% weakening of sterling 16 5 (2) (2)
Equity
10% strengthening of sterling (2,687) (2,201) (3) -
10% weakening of sterling 3,288 2,690 4 -
(ii) Interest rate risk
Interest rate risk refers to the risk that fluctuations in interest rates
cause losses to the Company.
The Group and Company have no exposure to interest rate risk except on cash
and cash equivalent which carry variable interest rates. The group carries
low units of cash and cash equivalents and the group and company's monitor the
variable interest risk accordingly.
At 31 December 2016, the Group and Company has GBP loans valued at £6,162,000
rates of 0% per annum.
At 31 December 2015, the Group and Company has GBP loans valued at £10,778,000
rates of 0% per annum and loans of £450,000 at 7.5% per annum.
c. Liquidity risk
Liquidity risk refers to the risk that the Company runs low on cash resources
to meet working capital requirements.
The Group and Company manages its liquidity requirements by using both short-
and long-term cash flow projections, supplemented by maintaining debt
financing plans and active portfolio management. Ultimate responsibility for
liquidity risk management rests with the Board of Directors, which has built
an appropriate liquidity risk management framework for the management of the
Group's short-, medium- and long-term funding and liquidity management
requirements.
The Group closely monitors and manages its liquidity risk. Cash forecasts are
regularly produced and sensitivities run for different scenarios (see Note
1).
For further details on the Group's liquidity position, please refer to the
going concern paragraph in Note 1 of these accounts.
Maturity analysis of financial liabilities 2016 2015
£ '000s £ '000s
Less than six months - loans and borrowings - 461
Less than six months - trade and other payables 256 508
Between six months and a year - 10,778
Between one and three years 6,162 -
d. Capital management
The Group manages its shares and CLN's as capital.
e. There are no externally imposed capital requirements. Fair value of
financial instruments
Set in the foregoing is a comparison of carrying amounts and fair values of
the Group's and the Company's financial instruments:
Carrying amount Fair Value of financial instruments Carrying Fair Value of financial instruments
Year ended 31 December 2016 Year ended 31 December 2016 Year ended31 December 2015 Year ended31 December 2015
Financial assets
Cash and cash equivalents 3,153 3,153 32 32
Trade receivables - - - -
Financial liabilities
Trade Creditors 147 147 171 171
Convertible loans at fixed rate 6,162 6,162 10,778 10,778
Capital Management - Company Year ended 31 December 2016 Year ended 31 December 2016 Year ended 31 December 2015 Year ended 31 December 2015
Carrying Fair Value of financial instruments Carrying Fair Value of financial instruments
Financial assets
Cash and cash equivalents 3,154 3,154 27 27
Trade receivables - - 19,152 19,152
Financial liabilities
Trade Creditors 84 84 114 114
Convertible loans at fixed rate 6,162 6,162 10,778 10,778
Convertible loan at fixed rate
Fair value of convertible loans has been determined based on tier 3
measurement techniques. The fair value is estimated at the present value of
future cash flows, discounted at estimated market rates. Fair value is not
significantly different from carrying value.
Trade and other receivables/payables & intercompany receivables
All trade and other receivables and payables have a remaining life of less
than one year. The ageing profile of the Group and Company receivable and
payables are shown in Notes 10, 11, 15 and 16.
Cash and cash equivalents
Cash and cash equivalents are all readily available and therefore carrying
value represents a close approximation to fair value.
This information is provided by RNS
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