REG - Petro Matad Ltd - Interim results
Petro Matad Limited
('Petro Matad' or the 'Company')
Interim results for the six months ended 30 June 2020
LONDON, 17 August 2020: Petro Matad Limited, the AIM quoted Mongolian oil company, is pleased to announce its unaudited interim results for the six months ended 30 June 2020.
Financial Summary
The Group posted a loss of USD 2.35 million for the six-month period ended 30 June 2020, which compares to a loss of USD 4.41 million for the comparable period in 2019. The Company's cash balance at 30 June 2020 was USD 2.08 million (USD 2.07 million in cash and USD 0.01 million in Financial Assets), which compares to a cash balance of USD 16.12 million (USD 3.79 million in cash and USD 12.33 million in Financial Assets) on 30 June 2019.
The Company has strategically put in place cost saving measures without sacrificing its operational capability, which in the absence of new sources of financing, will enable it to remain in an operationally ready state until mid-2021. Meanwhile the Company is pursuing a number of options to fund the next stage of its activities.
Operational Update
· The Block XX Exploitation Licence (EL) application continues to progress through the government's approval processes. A key component is approval of the Company's reserve report for its Heron 1 oil discovery. The report has been reviewed by auditors appointed by the Ministry of Mining and Heavy Industry (MMHI) and forwarded for final review and approval to the Mineral Resource Professional Council (MRPC). We are pushing for the council to meet and we are hopeful that it will do so before the end of the third quarter.
· Once the reserves report has been approved, the EL award process requires the development area to be agreed with industry regulator Mineral Resources and Petroleum Authority of Mongolia (MRPAM) and then the Plan of Development must be reviewed and approved by MRPAM and MMHI. The Plan of Development has been completed save for any minor modifications which may result from the ongoing review of the reserves report and it will be submitted to the relevant bodies as soon as the reserves report approval is in hand.
· The Covid-19 pandemic combined with the Mongolian parliamentary election which was held in June 2020 have caused some delays in the EL approval processes but the previously announced one-year moratorium obtained for Block XX ensures that the PSC remains in good standing as the EL award process progresses.
· In parallel with the EL the Company is also working with MRPAM to progress the issues of land access which caused some delay and disruption to operations in 2019. MRPAM advises that they expect the issues, which arose as a result of new legislation (Reg 287 of 2017), will be resolved by the adoption of the conclusions of a working group. Those conclusions are currently progressing through the government's approval processes.
· Mongolia continues to manage the Covid-19 pandemic with the strict application of in-country measures as well as maintaining border closures to all but essential travel. To date, community spread has successfully been prevented in Mongolia and the impact on the Company's activities has been limited with its office and those of MRPAM and MMHI functioning as normal throughout.
Further operational updates will be provided in due course.
- Ends -
Further information please contact:
Petro Matad Limited
Mike Buck, CEO
+97 670 141 099 / +97 675 751 099
Shore Capital (Nominated Adviser and Broker)
Toby Gibbs
Jerry Keen
John More
+44 (0) 20 7408 4090
FTI Consulting (Communications Advisory Firm)
Sara Powell
Ben Brewerton
+44 (0) 20 3727 1000
About Petro Matad
Petro Matad is the parent company of a group focussed on oil exploration, as well as future development and production in Mongolia. At the current time, Petro Matad holds 100% working interest and the operatorship of three Production Sharing Contracts with the Government of Mongolia. Block XX has an area of 10,367 square kilometres in the far eastern part of the country and Blocks IV and V have an area of 29,062 square kilometres and 21,143 square kilometres, respectively, in the central western part of the country.
Petro Matad Limited is incorporated in the Isle of Man under company number 1483V. Its registered office is at Victory House, Prospect Hill, Douglas, Isle of Man, IM1 1EQ.
STATEMENT OF COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED 30 JUNE 2020
Consolidated
30 Jun 2020
30 Jun 2019
$'000
$'000
Continuing Operations
Revenue
Interest Income
15
508
Other Income
20
2
35
510
Expenditure
Consultancy fees
(38)
(62)
Depreciation and amortisation
(63)
(101)
Employee benefits expenses
(1,323)
(1,510)
Exploration expenditure
(293)
(2,152)
Other expenses
(670)
(1,091)
Profit/(Loss) from continuing operations before income tax
(2,352)
(4,406)
Income tax expense
-
-
Profit/(Loss) from continuing operations after income tax
(2,352)
(4,406)
Net Loss
(2,352)
(4,406)
Other comprehensive income/(loss)
Exchange rate differences on translating foreign operations
(12)
(1)
Other comprehensive income/(loss), net of income tax
(12)
(1)
Total comprehensive loss
(2,364)
(4,407)
Profit/(Loss) attributable to owners of the parent
(2,352)
(4,406)
Total comprehensive income/(loss) attributable to owners of the parent
(2,364)
(4,407)
Earnings/(loss) per share (cents per share)
- Basic and diluted earnings/(loss) per share
(0.35)
(0.67)
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2020
Consolidated
30 Jun 2020
31 Dec 2019
30 Jun 2019
$'000
$'000
$'000
ASSETS
Current Assets
Cash and cash equivalents
2,069
2,815
3,790
Trade and other receivables
8
23
42
Prepayments
160
155
220
Financial assets
10
1,510
12,334
Inventory
225
226
205
Total Current Assets
2,472
4,729
16,591
Non-Current Assets
Exploration and evaluation
15,275
15,275
15,275
Property, plant and equipment
203
260
319
Total Non-Current assets
15,478
15,535
15,594
TOTAL ASSETS
17,950
20,264
32,185
LIABILITIES
Current liabilities
Trade and other payables
246
502
477
Total Current Liabilities
246
502
477
TOTAL LIABILITIES
246
502
477
NET ASSETS
17,704
19,762
31,708
EQUITY
Issued capital
143,721
143,174
143,174
Reserves
2,809
3,062
2,579
Accumulated losses
(128,826)
(126,474)
(114,045)
TOTAL EQUITY
17,704
19,762
31,708
CONDENSED CASH FLOW STATEMENT
FOR THE HALF-YEAR ENDED 30 JUNE 2020
Consolidated
30 Jun 2020
30 Jun 2019
$'000
$'000
Cash flows from operating activities
Payments to suppliers and employees
(2,349)
(5.568)
Interest received
15
508
Net cash flows from/(used in) operating activities
(2,334)
(5,060)
Cash flows from operating activities
Purchase of property, plant and equipment
(10)
(87)
Proceeds of financial assets
1,500
6,827
Proceeds from the disposal of plant and equipment
-
-
Net cash flows from/(used in) investing activities
1,490
6.740
Cash flows from financing activities
Proceeds from issue of shares
110
-
Capital raising costs
-
-
Net cash flows from/(used in) financing activities
110
-
Net increase/(decrease) in cash and cash equivalents
(734)
1.680
Net foreign exchange differences
(12)
(1)
Cash and cash equivalents at beginning of period
2,815
2,111
Cash and cash equivalents at end of period
2,069
3,790
STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 30 JUNE 2020
Consolidated
Attributable to equity holders of the parent
Issued Capital
$'000
Accumulated Losses
$'000
Other
Reserves $'000
Total
$'000
As at 1 January 2019
143,174
(109,809)
2,660
36,025
Income/(Loss) for the period
-
(4,406)
-
(4,406)
Other comprehensive income
-
-
(1)
(1)
Total comprehensive income/(loss) for the period
143,174
(114,215)
2,659
31,618
Transactions with owners in their capacity as owners
Issue of share capital
-
-
-
-
Cost of capital raising
-
-
-
-
Share based payments
-
170
(80)
90
As at 30 June 2019
143,174
(114,045)
2,579
31,708
As at 1 January 2020
143,174
(126,474)
3,062
19,762
Income/(Loss) for the period
-
(2,352)
-
(2,352)
Other comprehensive income
-
-
(12)
(12)
Total comprehensive income/(loss) for the period
143,174
(128,826)
3,050
17,398
Transactions with owners in their capacity as owners
Issue of share capital
121
-
-
121
Cost of capital raising
-
-
-
-
Share based payments
426
-
(241)
185
As at 30 June 2020
143,721
(128,826)
2,809
17,704
1. CORPORATE INFORMATION
The financial report covers the consolidated entity of Petro Matad Limited and its controlled entities.
Petro Matad Limited, a company incorporated in the Isle of Man on 30 August 2007 has four wholly owned subsidiaries, including Capcorp Mongolia LLC and Petro Matad LLC (both incorporated in Mongolia), Central Asian Petroleum Corporation Limited ("Capcorp") and Petromatad Invest Limited (both incorporated in the Cayman Islands). Its major shareholder is Petrovis Matad Inc.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The half-year financial report does not include all of the notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the consolidated entity as the full financial report.
The half-year financial report should be read in conjunction with the annual Financial Report of Petro Matad Limited as at 31 December 2019. The half-year consolidated financial statements have been prepared using the same accounting policies as used in the annual financial statements for the year ended 31 December 2019.
It is also recommended that the half-year financial report is considered together with any public announcements made by Petro Matad Limited and its controlled entities during the half-year ended 30 June 2020.
(a) Basis of Preparation
The half-year consolidated financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ('IASB'). The half-year financial report has been prepared on a historical cost basis, except where stated.
The financial report is presented in US dollars and all values are rounded to the nearest thousand dollars ($'000).
For the purpose of preparing the half-year financial report, the half-year has been treated as a discrete reporting period.
(b) Basis of consolidation
The consolidated financial statements comprise the financial statements of the Group as at 31 December each year.
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are exercisable or convertible are taken into account. The financial statements of the subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
The financial statements of subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist.
A change in the ownership interest of a subsidiary that does not result in a loss of control is accounted for as an equity transaction.
All intercompany balances and transactions, including unrealised profits arising from intra-group transactions, have been eliminated in full. Unrealised losses are eliminated unless costs cannot be recovered.
3. CONTRIBUTED EQUITY
CONSOLIDATED
30 Jun 2020
31 Dec 2019
$'000
$'000
Ordinary shares (i)
674,289,306 shares issued and fully paid
(31 Dec 2019: 662,196,306)
143,721
143,174
143,721
143,174
(i) Ordinary shares
Fully paid ordinary shares carry one vote per share and carry the right to dividends.
4. RESERVES
A detailed breakdown of the reserves of the Group is as follows:
Merger reserve
Equity benefits reserve
Foreign currency translation
Total
Consolidated
$'000
$'000
$'000
$'000
As at 1 July 2019
831
2,938
(1,190)
2,579
Currency translation differences
-
-
(13)
(13)
Share based payments
-
496
-
496
As at 31 December 2019
831
3,434
(1,203)
3,062
Currency translation differences
-
-
(12)
(12)
Share based payments
-
(241)
-
(241)
As at 30 June 2020
831
3,193
(1,215)
2,809
5. EARNINGS/(LOSS) PER SHARE
The following reflects the income and share data used in the total operations basic and diluted earnings/(loss) per share computations:
CONSOLIDATED
30 Jun
2020
30 Jun
2019
Basic earnings/(loss) per share
Total basic earnings/(loss) per share (US$ cents per share) (note a)
(0.35)
(0.67)
Diluted earnings/(loss) per share
Total diluted earnings/(loss) per share (US$ cents per share) (note b)
(0.35)
(0.67)
(a) Basic earnings/(loss) per share
The profit/(loss) and weighted average number of ordinary shares used in the calculation of basic loss per share are as follows:
Net profit/(loss) attributable to ordinary shareholders (US$'000)
(2,352)
(4,406)
Weighted average number of ordinary shares for the purposes of basic earnings per share ('000)
672,429
662,196
(b) Diluted earnings/(loss) per share
The profit/(loss) and weighted average number of ordinary shares used in the calculation of diluted earnings per share are as follows:
Net profit/(loss) attributable to ordinary shareholders (US$'000)
(2,352)
(4,406)
Weighted average number of ordinary shares for the purposes of basic earnings per share ('000)
672,429
662,246
Share Options and Conditional Share Awards could potentially dilute basic loss per share in the future, however they have been excluded from the calculation of diluted loss per share because they are anti-dilutive for both years presented.
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.ENDIR UNVVRRVUWAAR
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