REG - Paternoster Res. - Half-year Report <Origin Href="QuoteRef">PRSPA.L</Origin>

Riverfort Global OpportunitiesAnnouncement

19/09/2017 07:06

RNS Number : 0877R
Paternoster Resources PLC
19 September 2017
PATERNOSTER RESOURCES PLC
("Paternoster" or the "Company")
Unaudited interim results for the 6 months ended 30 June 2017
Paternoster Resources plc is pleased to announce its unaudited interim results for the six months ended 30 June 2017.
Key points
 Certain of Paternoster's investments have been very active during this period
 Net asset value per share was 1.7 times the share price at the period end
 Listed investments and cash represented 116% of market capitalisation at the period end
 GAEA Resources Limited became a major shareholder
Chairman's review
The Company made a loss after tax of 793,959 for the six months ended 30 June 2017 compared to a profit of 443,582 for the same period in 2016. As at 30 June 2017, the Company's net assets amounted to 2,790,495 or 0.27p per share, compared to 3,584,454 or 0.35 pence per share as at 31 December 2016. The majority of the investment portfolio comprises listed investments and cash.
Nicholas Lee, Chairman of Paternoster, commented: 
"A number of the companies in Paternoster's investment portfolio have been very active. Overall, the Company's net assets have decreased during the period, principally due to the fall in the Plutus PowerGen plc ("Plutus") share price as a result of uncertainty surrounding the statement by OFGEM with respect toTRIAD payments to local embedded power generators. Plutus, however, is confident in its business model going forwardand its share price has since recovered significantly, increasing by over 25% at the period end from its low point during the first quarter of 2017. Furthermore, since the period end, the Plutus share price has increased by a further 60%, adding over 400,000 to the Company's net assets. Ortac Resources has been restructured and refocused and, since the period end, Paternoster has now received shares in i3 Energy Limited via its investment in Glenwick plc, and these shares are now listed. Also, during the first quarter, we welcomed a new major shareholder and expect this relationship to provide significant benefits to the Company going forward."
The key unaudited performance indicators are set out below. 
COMPANY STATISTICS
30 June 2017
31 December 2016
Change 
Net asset value
2,790,495
3,584,454
-22.2%
Net asset value - fully diluted per share
0.274p
0.353p
-22.4%
Closing share price
0.160p
0.180p
-11.1%
Share price discount to net asset value
(41.2%)
(49.0%)
Market capitalisation
1,627,000
1,830,000
-11.1%
The Company's principal investments are summarised below:
Category
Principal investments
Cost or valuation at 30 June 2017 ()
Listed investments
Metal Tiger plc, MX Oil plc, Plutus PowerGen plc, Shumba Energy Limited, Pires Investments plc, Ortac Resources Limited and Polemos plc 
1,557,968
Cash resources
327,228
Cash and listed investments
1,885,196
Unlisted investments
932,250
Total
2,817,446
Recent developments with regard to certain of the Company's investments are described below:
Plutus PowerGen plc
During Q4 2016, the Plutus share price increased from 1.5 pence to 2.6 pence, however, in Q1 2017 it fell significantly as a result of the uncertainly surrounding the OFGEM statement regarding TRIAD payments to local embedded power generators. Given that Plutus benefits from multiple earnings streams, it believes that its business model going forward continues to be attractive. It also has a number of projects in the pipeline that are expected to deliver additional fees and revenues. The company is continuing to broaden its exposure to the UK energy sector which includes looking to develop battery energy storage projects. It has also received planning for two further renewable green diesel power generation sites and has recently signed a joint venture with a leading UK supplier of gas and diesel generators. By the period end, the company's share price had already recovered by over 25% from its low point in Q1 2017 and, since the period end it is up a further 60%.
Alecto Minerals plc
The company continues to pursue the proposed acquisition of the Mowana Copper Mine in Botswana which is currently in production. Unfortunately, the completion of this acquisition has been delayed leading to the company's shares being suspended for more than six months pending the issue of an admission document and so, under the AIM rules, the company's shares have now been cancelled from listing.The company is working on progressing this transaction with a view to coming back to the market.
Ortac Resources Limited
In April 2017, the company announced that it has entered into an agreement to form a joint venture with a Slovakian company to jointly develop the Sturec Gold Project at Kremnica.These discussions continue to progress. The Sturec project has a reserve of just under 900,000 oz gold equivalent which has reached the pre-feasibility stage. The company's underground mining licence has been re-issued and mining operations have now recommenced.
In May 2017, the company raised 2 million before expenses and invested US$2 million in a convertible loan note issued by Casa Mining Limited ("CASA"). Following conversion and, including its existing investment, the company would become CASA's largest shareholder with around 45%. CASA is a private company that holds prospective gold mining and exploration licences in the Democratic Republic of Congo. CASA holds three contiguous mining licenses (covering a total 133km2), issued in March 2015 and valid for 30 years.
In June 2017, CASA's most advanced project, the Akyanga Deposit, African Mining Consultants ("AMC") provided an updated JORC-compliant Inferred Mineral Resource of 1,046,000 oz Au at an average grade of 2.27 g/t Au, using a US$1,250/oz gold price and a conservative 1.50 g/t Au cut-off grade. Also, the Au Inferred Mineral Resources at a 0.5 g/t Au cut-off grade have increased by over 350,000 oz to 1,573,000 oz Au at an average grade of 1.65 g/t Au. In August 2017, the company announced that drilling operations had commenced at the Akyanga deposit which is expected to comprise around 5,000 metres of diamond drilling.
In June 2017, the company converted certain of the loan notes it holds in Zamsort Limited ("Zamsort"), a company based in Zambia with interests in copper and cobalt. As a result, the company now has a 14% equity interest in Zamsort. 
Over this period, the board of the company has also been restructured and, more recently, the company has announced its intention to focus principally on the development of its high potential African mining assets, namely CASA and Zamsort.
Pires Investments plc
Pires Investments plc continues to actively review various investment opportunities with a view to undertaking a substantial transaction in order to deliver value to shareholders.
Polemos plc
Polemos plc invested in Oyster Oil and Gas Limited ("Oyster"), a company already listed on the TSX-V.Oyster currently operates four blocks in the Republic of Djibouti (100% interest) of which three blocks are located onshore and one block offshore. It also operates a 100% working interest in a large onshore block in the Republic of Madagascar.Oyster is expected to be listed on AIM shortly. In July 2017, the company raised around 500,000 for working capital purposes and to fund the seeking of investment opportunities.
In September 2017, Polemos announced the potential acquisition of a cyber security business SecurLinx Corporation, a US based cyber security company, for around 17.8 million. As this would constitute a reverse takeover, its shares have been suspended pending the publication of an admission document.
Glenwick plc
The principal asset of Glenwick plc ("Glenwick") comprised 1.1 million of pre-IPO convertible loan notes in i3 Energy Limited ("i3"). i3 has now completed its IPO, the convertible loan note has been converted and the majority of these shares in i3 have been passed through to the shareholders of Glenwick, which includesPaternoster. The investment made in connection with the listing of Cora Gold ("Cora") is expected to be exchanged for new shares in Cora which will then also be distributed to shareholders once Cora becomes listed later in 2017.
N Lee
Chairman
19 September 2017
For more information, please contact:
Paternoster Resources plc: 
Nicholas Lee, Chairman +44 (0) 20 7580 7576
  
Nominated Adviser and Joint Broker:   +44 (0) 20 7601 6100
Stockdale Securities
Antonio Bossi/David Coaten
Joint Broker:   +44 (0) 20 7562 3351
Peterhouse Capital Limited
Lucy Williams
PR: 
Cassiopeia Services +44 (0) 7949 690338
Stefania Barbaglio
UNAUDITED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2017
Unaudited
6 months
ended 
30 June
2017
Unaudited
6 months
ended
30 June
2016
Audited
Year ended
31 December
2016
Net (losses)/gains on investments
(627,081)
591,762
770,086
Investment income
1,871
11,437
15,090
Total income
(625,210)
603,199
785,176
Administration expenses
(168,749)
(159,617)
(299,128)
(Loss)/profit before taxation
(793,959)
443,582
486,048
Taxation
-
-
-
(Loss)/profit for the period and total comprehensive income
(793,959)
443,582
486,048
Basic (loss)/earnings per share
Continuing and total operations
(0.078)p
0.048p
0.051p
Fully diluted (loss)/earnings per share
Continuing and total operations
(0.078)p
0.046p
0.051p
UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2017 
 
Called up
share 
 capital
Share premium
account
Other reserves 
Retained
deficit
Total 
equity
Balance at 
1 January 2016
4,175,796
3,135,007
119,407
(4,481,804)
2,948,406
Profit for the year and total comprehensive expense
-
-
-
486,048
486,048
Share issue
93,750
56,250
-
-
150,000
Transfer on cancellation of options
-
-
(19,257)
19,257
-
Transactions with owners
93,750
56,250
(19,257)
19,257
150,000
Balance at 
31 December 2016
4,269,546
3,191,257
100,150
(3,976,499)
3,584,454
Loss for the period and total comprehensive income 
-
-
-
(793,959) 
(793,959)
Balance at 
30 June 2017
4,269,546
3,191,257
100,150
(4,770,458)
2,790,495
UNAUDITED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2017
Unaudited
6 months
ended
30 June
2017 
Unaudited
6 months
ended
30 June
2016
Audited
Year ended
31 December
2016
ASSETS
Non-current assets
Available for sale investments
2,490,218
2,263,408
2,949,517
Total non-current assets
2,490,218
2,263,408
2,949,517
Current assets
Trade and other receivables
37,009
120,348
29,142
Cash and cash equivalents
327,228
1,104,468
648,165
Total current assets
364,237
1,224,816
677,307
Total assets
2,854,455
3,488,224
3,626,824
LIABILITIES
Current liabilities
Trade and other payables
63,960
94,640
42,370
Total current liabilities
63,960
94,640
42,370
Net assets
2,790,495
3,393,584
3,584,454
EQUITY
Share capital
4,269,546
4,175,796
4,269,546
Share premium account
3,191,257
3,135,007
3,191,257
Capital redemption reserve
27,000
27,000
27,000
Share option reserve
73,150
94,003
73,150
Retained losses
(4,770,458)
(4,038,222)
(3,976,499)
Total equity
2,790,495
3,393,584
3,584,454
UNAUDITED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2017
Unaudited
6 months
ended
30 June
2017
Unaudited
6 months
ended
30 June
2016
Audited
Year ended
31 December
2016
Cash flows from operating activities
Profit/(loss) before tax
(793,959)
443,582
486,048
Net (gains)/losses on investments
627,081
(666,762)
(770,086)
Share based payment expense
-
1,596
-
Investment income
(1,871)
(11,437)
(15,090)
(168,749)
(233,021)
(299,128)
(Increase)/decrease in trade and other receivables
(7,868)
47,497
(16,296)
Increase)/(decrease) in trade and other payables
21,590
7,971
(44,299)
Net cash used by operating activities
(155,027)
(177,553)
(359,723)
Cash flows from investing activities
Purchase of investments
(280,800)
(64,593)
(527,351)
Proceeds from disposal of investments
113,019
870,607
1,055,579
Investment income received
1,871
11,437
15,090
Net cash (used in)/from investing activities
(165,910)
817,451
543,318
Net (decrease)/increase in cash and cash equivalents
(320,937)
639,898
183,595
Cash and cash equivalents at beginning of period
648,165
464,570
464,570
Cash and cash equivalents at end of period
327,228
1,104,468
648,165
NOTES TO THE INTERIM REPORT
1. The financial information set out in this interim report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The group's statutory financial statements for the period ended 31 December 2016, prepared under International Financial Reporting Standards (IFRS), have been filed with the Registrar of Companies. The auditor's report on those financial statements was unqualified and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
The interim financial information has been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards (IFRS) and on the same basis and using the same accounting policies as used in the financial statements for the year ended 31 December 2016. The interim financial statements have not been audited or reviewed in accordance with the International Standard on Review Engagement 2410 issued by the Auditing Practices Board.
The financial statements have been prepared on a going concern basis under the historical cost convention. 
The Directors believe that the going concern basis is appropriate for the preparation of the financial statements as the Company is in a position to meet all its liabilities as they fall due.
2. The calculation of basic earnings per share is based on the loss for the period of 793,959 (2016: Profit 443,582) and a weighted average number of ordinary shares of 1,016,607,956 (2016: 922,857,956). The fully diluted earnings per share for the 6 months to 30 June 2017 is based on a weighted average number of ordinary shares of 1,016,607,956 (2016: 964,857,956). 
3. No interim dividend will be paid.
4. Copies of the interim report can be obtained from: The Company Secretary, Paternoster Resources plc, 30, Percy Street, London W1T 2DB and are available to view and download from the Company's website : www.paternosterresources.com

This information is provided by RNS
The company news service from the London Stock Exchange
  END
IR OKFDBABKDBCD