REG-Bisichi Mining PLC: Final Results <Origin Href="QuoteRef">BISI.L</Origin> - Part 4
22/04/2016 15:35
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items charged or credited directly to other comprehensive income, in which case
it is also dealt with in other comprehensive income.
Dividends
Dividends payable on the ordinary share capital are recognised as a liability
in the period in which they are approved.
Cash and cash equivalents
Cash comprises cash in hand and on-demand deposits. Cash and cash equivalents
comprises short-term, highly liquid investments that are readily convertible to
known amounts of cash and which are subject to an insignificant risk of changes
in value and original maturities of three months or less. The cash and cash
equivalents shown in the cashflow statement are stated net of bank overdrafts.
Assets held for sale
Non-current assets, or disposal groups comprising assets and liabilities, are
classified as held-for-sale if it is highly probable that they will be
recovered primarily through sale rather through continuing use. Such assets, or
disposal groups, are generally measured at the lower of their carrying amount
and fair value less costs of sell. Any impairment loss on a disposal group is
allocated first to goodwill, and then to the remaining assets and liabilities
on a pro rata basis, except that no loss is allocated to inventories, financial
assets, deferred tax assets, employee benefit assets, investment property which
continue to be measured in accordance with the group's other accounting
policies. Impairment losses on initial classification as held-for-sale and
subsequent gains and losses on remeasurement are recognised in profit or loss.
Once classified as held-for-sale, intangible assets and property, plant and
equipment are no longer amortised or depreciated, and any equity-accounted
investment is no longer equity accounted.
SEGMENTAL REPORTING
For management reporting purposes, the group is organised into business
segments distinguishable by economic activity. The group's only business
segments are mining activities and investment properties. These business
segments are subject to risks and returns that are different from those of
other business segments and are the primary basis on which the group reports
its segment information. This is consistent with the way the group is managed
and with the format of the group's internal financial reporting. Significant
revenue from transactions with any individual customer, which makes up 10
percent or more of the total revenue of the group, is separately disclosed
within each segment.
Notes to the financial statements
for the year ended 31 December 2015
1. Segmental reporting
2015
Business analysis Mining Property Other Total
£'000 £'000 £'000 £'000
Significant revenue customer A 14,126 - - 14,126
Significant revenue customer B 2,561 - - 2,561
Significant revenue customer C 1,545 - - 1,545
Other revenue 6,376 1,014 33 7,423
Segment revenue 24,608 1,014 33 25,655
Operating (loss)/profit before fair value (288) 690 31 433
adjustments & exchange movements
Revaluation of investments & exchange movements (497) 225 (11) (283)
Operating (loss)/profit and segment result (785) 915 20 150
Segment assets 10,102 13,525 2,594 26,221
Unallocated assets
- Non-current assets 20
- Cash & cash equivalents 1,608
Total assets excluding investment in joint 27,849
ventures and assets held for sale
Segment liabilities (4,865) (2,183) (229) (7,277)
Borrowings (2,280) (5,927) - (8,207)
Total liabilities (7,145) (8,110) (229) (15,484)
Net assets 12,365
Non segmental assets
- Investment in joint ventures 1,198
- Loan to joint venture 900
- Non-current asset held for sale 1,168
Net assets as per balance sheet 15,631
Geographic United South Other Unallocated Total
analysis Kingdom Africa £'000 £'000 £'000
£'000 £'000
Revenue 1,047 24,608 - - 25,655
Operating 935 (785) - - 150
profit/(loss)
and segment
result
Non-current 13,003 5,355 - 10 18,368
assets
excluding
investments
Total net 6,672 2,064 10 6,885 15,631
assets
Capital 1,002 1,990 - - 2,992
expenditure
2014
Business analysis Mining Property Other Total
£'000 £'000 £'000 £'000
Significant revenue customer A 12,607 - - 12,607
Significant revenue customer B 6,455 - - 6,445
Significant revenue customer C 1,793 - - 1,793
Other revenue 4,681 931 33 5,645
Segment revenue 25,536 931 33 26,500
Operating profit before fair value adjustments & 864 699 31 1,594
exchange movements
Revaluation of investments & exchange movements (143) (6) (81) (230)
Operating profit/(loss) and segment result 721 693 (50) 1,364
Segment assets 12,058 12,546 2,797 27,401
Unallocated assets
- Non-current assets 36
- Cash & cash equivalents 2,838
Total assets excluding investment in joint 30,275
ventures
Segment liabilities (6,698) (1,301) (319) (8,318)
Borrowings (2,179) (5,973) - (8,152)
(8,877) (7,274) (319) (16,470)
Unallocated liabilities (24)
Total liabilities (16,494)
Net assets 13,781
Non segmental assets
- Investment in joint ventures 2,898
- Loan to joint venture 1,040
Net assets as per balance sheet 17,719
Geographic analysis United South Other Unallocated Total
Kingdom Africa £'000 £'000 £'000
£'000 £'000
Revenue 964 25,536 - - 26,500
Operating profit and segment 643 721 - - 1,364
result
Non-current assets excluding 11,780 6,030 - 24 17,834
investments
Total net assets 5,724 3,176 17 8,802 17,719
Capital expenditure 26 1,877 - - 1,903
2. Operating costs
2015 2014
£'000 £'000
Mining 19,177 18,244
Property 111 97
Cost of sales 19,288 18,341
Administration 5,934 6,565
Operating costs 25,222 24,906
The direct property costs are:
Ground rent 10 8
Direct property expense 71 55
Bad debts 30 34
111 97
Operating costs above include depreciation of £1,284,000 (2014: £2,682,000).
3. GAIN/(LoSS) on revaluation of investment properties
The reconciliation of the investment surplus/(deficit) to the gain/(loss) on
revaluation of investment properties in the income statement is set out below:
2015 2014
£'000 £'000
Investment surplus/(deficit) 226 (5)
Loss on valuation movement in respect of head lease payments (1) (1)
Gain/(Loss) on revaluation of investment properties 225 (6)
4. (LOSS)/Profit before taxation
(Loss)/profit before taxation is arrived at after charging:
2015 2014
£'000 £'000
Staff costs (see note 29) 5,094 5,057
Depreciation 1,284 2,682
Exchange loss 497 143
Fees payable to the company's auditor for the audit of the 31 48
company's annual accounts
Fees payable to the company's auditor and its associates for
other services:
The audit of the company's subsidiaries pursuant to 8 3
legislation
Audit related services 2 1
The directors consider the auditors were best placed to provide the above
non-audit services.
The audit committee reviews the nature and extent of non-audit services to
ensure that independence is maintained.
5. Directors' emoluments
Directors' emoluments are shown in the Directors' remuneration report on pages
28 and 29 under the heading Directors' remuneration which is within the audited
part of that report.
6. Interest payable
2015 2014
£'000 £'000
On bank overdrafts and bank loans 364 487
Unwinding of discount 79 87
Other interest payable 30 19
Interest payable 473 593
7. Taxation
2015 2014
£'000 £'000
(a) Based on the results for the year:
Corporation tax - adjustment in respect of prior year - UK (23) 20
Corporation tax - adjustment in respect of prior year - 3 16
Overseas
Current tax (20) 36
Deferred tax 128 329
Total tax in income statement 108 365
(b) Factors affecting tax charge for the year:
The corporation tax assessed for the year is different from that at the
standard rate of corporation tax in the United Kingdom of 20% (2014: 23%)
The differences are explained below:
(Loss)/Profit on ordinary activities before taxation (147) 1,568
Tax on profit on ordinary activities at 20.25% (2014: 21.5%) (30) 337
Effects of:
Expenses not deductible for tax purposes 21 45
Adjustment to tax rate (63) (2)
Other differences 200 (59)
Adjustment in respect of prior years (20) 44
Total tax 108 365
(c) Analysis of United Kingdom and overseas tax
United Kingdom tax included in above:
2015 2014
£'000 £'000
Corporation tax - -
Adjustment in respect of prior years (23) 20
Current tax (23) 20
Deferred tax 12 38
(11) 58
Overseas tax included in above:
Corporation tax - 16
Adjustment in respect of prior years 3 -
Current tax 3 16
Deferred tax 116 291
119 307
8. Dividends paid
2015 2015 2014 2014
Per share £'000 Per share £'000
Dividends paid during the year relating to 4.00p 427 4.00p 427
the prior period
Dividends to be paid:
Interim dividend for 2015 paid on 5 February 1.00p 107 1.00p 107
2016
Proposed final dividend for 2015 3.00p 320 3.00p 320
4.00p 427 4.00p 427
The dividends to be paid are not accounted for until they have been approved at
the Annual General Meeting. The amount will be accounted for as an
appropriation of retained earnings in the year ending 31 December 2016.
9. (LOSS)/Profit and diluted (LOSS)/profit per share
Both the basic and diluted (loss)/profit per share calculations are based on a
loss of £259,000 (2014: profit: £1,103,000). The basic (loss)/profit per share
has been calculated on a weighted average of 10,676,839 (2014: 10,673,506)
ordinary shares being in issue during the period. The diluted (loss)/profit per
share has been calculated on the weighted average number of shares in issue of
10,676,839 (2014: 10,673,506) plus the dilutive potential ordinary shares
arising from share options of nil (2014: 110,975) totalling 10,676,839 (2014:
10,784,481).
Dilutive potential ordinary shares of 34,973 (2014: nil) were excluded from the
calculation of diluted ordinary shares as there was no dilutive effect due to
the loss for the year.
10. Investment properties
Freehold Long Total
£'000 Leasehold £'000
£'000
Valuation at 1 January 2015 8,925 2,650 11,575
Acquisition 960 - 960
Additions 40 - 40
Revaluation 225 - 225
Valuation at 31 December 2015 10,150 2,650 12,800
Valuation at 1 January 2014 9,035 2,524 11,559
Additions 22 - 22
Revaluation (132) 126 (6)
Valuation at 31 December 2014 8,925 2,650 11,575
Historical cost
At 31 December 2015 5,823 728 6,551
At 31 December 2014 4,823 728 5,551
Long leasehold properties are those for which the unexpired term at the balance
sheet date is not less than 50 years.
All investment properties are held for use in operating leases and all
properties generated rental income during the period.
Freehold and Long Leasehold properties were externally professionally valued at
31 December on an open market basis by:
2015
£'000
Carter Towler 12,800
The valuations were carried out in accordance with the Statements of Asset
Valuation and Guidance Notes published by The Royal Institution of Chartered
Surveyors.
Each year external valuers are appointed by the Executive Directors on behalf
of the Board. The valuers are selected based upon their knowledge, independence
and reputation for valuing assets such as those held by the group.
Valuations are performed annually and are performed consistently across all
investment properties in the group's portfolio. At each reporting date
appropriately qualified employees of the group verify all significant inputs
and review the computational outputs. Valuers submit their report to the Board
on the outcome of each valuation round.
Valuations take into account tenure, lease terms and structural condition. The
inputs underlying the valuations include market rent or business profitability,
likely incentives offered to tenants, forecast growth rates, yields, EBITDA,
discount rates, construction costs including any specific site costs (for
example section 106), professional fees, developer's profit including
contingencies, planning and construction timelines, lease regear costs,
planning risk and sales prices based on known market transactions for similar
properties to those being valued.
Valuations are based on what is determined to be the highest and best use. When
considering the highest and best use a valuer will consider, on a property by
property basis, its actual and potential uses which are physically, legally and
financially viable. Where the highest and best use differs from the existing
use, the valuer will consider the cost and likelihood of achieving and
implanting this change in arriving at its valuation.
There are often restrictions on Freehold and Leasehold property which could
have a material impact on the realisation of these assets. The most significant
of these occur when planning permission or lease extension and renegotiation of
use are required or when a credit facility is in place. These restrictions are
factored in the property's valuation by the external valuer.
IFRS 13 sets out a valuation hierarchy for assets and liabilities measured at
fair value as follows:
Level 1: valuation based on inputs on quoted market prices in active markets
Level 2: valuation based on inputs other than quoted prices included within
level 1 that maximise the use of observable data directly or from market prices
or indirectly derived from market prices.
Level 3: where one or more inputs to valuations are not based on observable
market data
The inter-relationship between key unobservable inputs and the groups'
properties is detailed in the table below:
Class of property Level 3 Carrying/ Valuation Key Range
fair value technique unobservable (weighted
2015 inputs average)
£'000 2015
Freehold - external 10,150 Income Estimated rental £7 - £27 (£19)
valuation capitalisation value
per sq ft p.a
Equivalent Yield 8.0% - 12.6%
(9.2%)
Long leasehold - external 2,650 Income Estimated rental £8 - £8 (£8)
valuation capitalisation value per sq ft
p.a
Equivalent yield 7.5% - 7.5%
(7.5%)
At 31 December 2015 12,800
There are interrelationships between all these inputs as they are determined by
market conditions. The existence of an increase in more than one input would be
to magnify the input on the valuation. The impact on the valuation will be
mitigated by the interrelationship of two inputs in opposite directions, for
example, an increase in rent may be offset by an increase in yield.
The table below illustrates the impact of changes in key unobservable inputs on
the carrying / fair value of the group's properties:
Estimated rental Equivalent yield
value 25 basis point
10% increase or contraction
decrease or expansion
£'000 £'000
Freehold - external 1,015 / (1,015) 300 / (263)
valuation
Long Leasehold - 265 / (265) 92 / (86)
external valuation
11. Mining reserves, plant and equipment
Mining Mining Motor Office Total
reserves equipment vehicles equipment £'000
£'000 £'000 £'000 £'000
Cost at 1 January 2015 1,266 17,539 169 115 19,089
Exchange adjustment (271) (4,048) (30) (12) (4,361)
Additions - 1,964 11 17 1,992
Disposals - (2) - - (2)
Cost at 31 December 2015 995 15,453 150 120 16,718
Accumulated depreciation at 1 1,149 11,705 77 94 13,025
January 2015
Exchange adjustment (256) (2,679) (17) (11) (2,963)
Charge for the year 56 1,177 39 12 1,284
Disposals - (2) - - (2)
Accumulated depreciation at 31 949 10,201 99 95 11,344
December 2015
Net book value at 31 December 2015 46 5,252 51 25 5,374
Cost at 1 January 2014 1,310 16,328 165 112 17,915
Exchange adjustment (44) (550) (4) (2) (600)
Additions - 1,838 38 5 1,881
Disposals - (77) (30) - (107)
Cost at 31 December 2014 1,266 17,539 169 115 17,915
Accumulated depreciation at 1 1,184 9,470 77 88 10,819
January 2014
Exchange adjustment (38) (329) (1) (1) (369)
Charge for the year 3 2,641 31 7 2,682
Disposals in year - (77) (30) - (107)
Accumulated depreciation at 31 1,149 11,705 77 94 13,025
December 2014
Net book value at 31 December 2014 117 5,834 92 21 6,064
12. Investments held as non-current assets
2015 2015 2014 2014
Joint Other Joint Other
ventures £'000 ventures £'000
assets assets
£'000 £'000
At 1 January 2,898 156 3,235 156
Transfer to non-current asset held (1,168) - - -
for sale
Loss on transfer - (126) - -
Dividends received (105) - (900) -
Exchange adjustment (358) (1) - -
Share of gain in joint ventures 69 - 563 -
Loss on reclassification of (138) - - -
non-current asset held for sale
Net assets at 31 December 1,198 29 2,898 156
Loan to joint venture
(Ezimbokedwini):
At 1 January 1,040 - 984 -
Exchange adjustments (235) - (36) -
Additions 95 - 92 -
At 31 December 900 - 1,040 -
At 31 December 2,098 29 3,938 156
Provision for diminution in value:
At 1 January - (4) - (5)
Transfer - - - -
Write back\(down) of investment - (11) - 1
At 31 December - (15) - (4)
Net book value at 31 December 2,098 14 3,938 152
2015 2014
£'000 £'000
Net book value of unquoted investments - 126
Net book and market value of investments listed on overseas stock 14 26
exchanges
14 152
13. Joint ventures
The company owns 50% of the issued share capital of Dragon Retail Properties
Limited, an unlisted property investment company. The remaining 50% is held by
London & Associated Properties PLC. Dragon Retail Properties Limited is
incorporated in England and Wales. It has issued share capital of 500,000
(2014: 500,000) ordinary shares of £1 each.
The company owns 49% of the issued share capital of Ezimbokodweni Mining (Pty)
Limited, an unlisted coal exploration and development company. The company is
incorporated in South Africa. It has issued share capital of 100 (2014: 100)
ordinary shares of ZAR1 each.
Prior to 11 March 2016, the company owned 12.5% of the units of Langney
Shopping Centre Unit Trust, an unlisted property unit trust incorporated in
Jersey. 12.5% of the units in the trust were held by London & Associated
Properties PLC and 75% were held by Columbus UK GP limited, a partner acting on
behalf of Columbus UK Real Estate Fund. On the 11 March 2016, the company
disposed of its investment in Langney Shopping Centre Unit Trust. The net
proceeds from the sale were £1,168,000 which includes £30k dividends repaid
post year end. At 31 December 2015, the investment was transferred from
investment in joint ventures to non-current asset held for sale in the balance
sheet. At year end, the share of the net assets of the trust held by the group
were £1,168,000 (2014: £1,375,000) which includes a loss on the
reclassification of the asset to held for sale in the amount of £138,000.
Dragon Ezimbokodweni Langney 2015 2014
50% 49% 12.5% £'000 £'000
£'000 £'000 £'000
Turnover 86 - 172 258 236
Profit and loss
(Loss)/Profit before tax (37) - (102) (139) 564
Taxation 70 - - 70 (1)
(Loss)/Profit after taxation 33 - (102) (69) 563
Balance sheet
Non-current assets 1,349 895 2,286 4,530 5,060
Current assets 1,274 2 102 1,378 1,735
Current liabilities (1,100) (897) (46) (2,043) (2,329)
Non-current liabilities (650) - (1,174) (1,824) (2,251)
Share of net assets at 31 873 - 1,168 2,041 2,215
December
14. NON-CURRENT ASSETS HELD FOR SALE
2015 2014
£'000 £'000
Investment in Langney Shopping Centre Unit Trust
Balance at 1 January - -
Transfer 1,168 -
1,168 -
On the 11 March 2016, the company disposed of its investment in Langney
Shopping Centre Unit Trust, an unlisted property unit trust incorporated in
Jersey. At year end, the company owned 12.5% of the units of the trust. The net
proceeds from the sale were £1,138,000 (excluding dividend). At year end, the
company's share of the net assets of the trust were £1,168,000 (2014: £
1,375,000).
15. Subsidiary companies
The company owns the following ordinary share capital of the subsidiaries which
are included within the consolidated financial statements:
Activity Percentage of Country of
share capital incorporation
Mineral Products Limited Share dealing 100% England and Wales
Bisichi (Properties) Limited Property 100% England and Wales
Bisichi Northampton Limited Property 100% England and Wales
Bisichi Trustee Limited Property 100% England & Wales
Urban First (Northampton) Property 100% England & Wales
Limited
Black Wattle Colliery (Pty) Coal mining 62.5% South Africa
Limited
Bisichi Coal Mining (Pty) Coal mining 100% South Africa
Limited
Black Wattle Klipfontein (Pty) Coal mining 62.5% South Africa
Limited
Bisichi Mining (Exploration) Holding company 100% England and Wales
Limited
Ninghi Marketing Limited Dormant 90.1% England and Wales
Bisichi Mining Managements Dormant 100% England and Wales
Services Limited
Amandla Ehtu Mineral Resource Dormant 70% South Africa
Development (Pty) Limited
Details on the non-controlling interest in subsidiaries are shown under note
27.
16. Inventories
2015 2014
£'000 £'000
Coal
Washed 778 606
Run of mine 110 1,070
Work in progress 122 45
Other 39 39
1,049 1,760
17. Trade and other receivables
2015 2014
£'000 £'000
Amounts falling due within one year:
Trade receivables 3,500 4,046
Amount owed by joint venture 2,140 2,168
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