REG - TomCo Energy PLC - Final Results for the year ended 30 September 2024
11/03/2025 07:15
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RNS Number : 0913A TomCo Energy PLC 11 March 2025
11 March 2025
TOMCO ENERGY PLC
("TomCo" or the "Company" or, together with its subsidiaries, the "Group")
Final Results for the year ended 30 September 2024
TomCo (AIM: TOM), the US operating oil development group focused on using
innovative technology to unlock unconventional hydrocarbon resources, is
pleased to announce its audited results for its financial year ended 30
September 2024.
Copies of the full 2024 Annual Report and Accounts will be made available on
the Company's website at www.tomcoenergy.com and will shortly be posted to
shareholders.
Enquiries:
TomCo Energy plc
Malcolm Groat (Executive Chairman) +44 (0) 20 3823 3635
Strand Hanson Limited (Nominated Adviser) +44 (0) 20 7409 3494
James Harris / Matthew Chandler
Novum Securities Limited (Broker) +44 (0) 20 7399 9402
Jon Belliss / Colin Rowbury
For further information, please visit www.tomcoenergy.com
(http://www.tomcoenergy.com) .
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended by virtue of the Market
Abuse (Amendment) (EU Exit) Regulations 2019.
CHAIRMAN'S STATEMENT
I am pleased to provide this statement to, amongst others, the stakeholders in
TomCo Energy PLC ("TomCo" or the "Company", or, together with its subsidiaries
the "Group") as part of the Annual Report and Financial Statements for its
financial year ended 30 September 2024.
The period under review did not turn out as any of us could have anticipated.
In late May, our much respected and well-liked Chief Executive, John Potter,
passed away suddenly at the age of 54. I am most grateful to all who sent
their condolences and who rallied around with support over the summer,
particularly my fellow directors.
Operational Review
Prior to John's passing, progress in Utah had been frustratingly slow for some
time, despite the team's best efforts. This was essentially due to the lack of
a suitable funding package to pursue the construction of up to two oil sands
separation plants capable of processing at least 6,000 tonnes per day of oil
sands at our preferred permitted site in Uintah County, Utah, USA, which did
not materialise during the period or subsequently. The potential funding
source that John was focused on may yet come to fruition in 2025, however a
successful conclusion and consummation of the requisite committed funding
package remains uncertain, particularly as to timing. Alternative funding
avenues such as potential strategic investors, joint venture or funding
partners will continue to be explored.
In the absence of sufficient funding to enable us to purchase the remaining
90% of Tar Sands Holdings II LLC ("TSHII") and consequent expiration, at the
end of 2023, of our subsidiary, Greenfield Energy, LLC's ("Greenfield")
exclusive right to exercise its related option, we were subsequently
approached in early August 2024 by the counterparty, Endeavor Capital Group,
LLC ("Endeavor Capital") with a proposal to redeem Greenfield's 10% membership
interest for cash. Such redemption would serve to facilitate Endeavor Capital
in disposing of 100% of TSHII to a third party interested in potentially
refurbishing an historic dilapidated refinery on TSHII's acreage for the
future processing of crude brought in from other locations. Cognisant of the
Group's working capital requirements, we proceeded to negotiate terms for the
redemption on the basis that:
(i) TSHII agreed not to terminate the existing lease arrangement between
AC Oil, LLC ("AC Oil"), a wholly-owned subsidiary of Greenfield, and TSHII
(the "Lease") in respect of approximately 320 acres of land and associated
rights and certain non-producing historic infrastructure, plant and equipment
in Uintah County, Utah, USA, owned by TSHII (the "Lease Area"). Such Lease
grants AC Oil the exclusive right to explore, drill and mine for, and extract,
store, and remove oil, gas, hydrocarbons and other associated substances on
and from the Lease Area, together, inter alia, with the right to erect,
construct and use such plant and equipment and infrastructure as required; and
(ii) TSHII also agreed to use best efforts to negotiate in good faith
with Greenfield with respect to entering into an additional lease to provide
mining rights on certain further acreage owned by TSHII that is not otherwise
needed for the aforementioned planned refurbished refinery (the "Additional
Lease") which could potentially be a source of additional tar sands to feed
Greenfield's future proposed separation plants. Accordingly, once the
Additional Lease is secured, Greenfield will remain well positioned to
continue to pursue its existing tar sands development project subject to
ultimately securing the requisite additional funding and permitting going
forwards.
Further to the receipt of shareholder approval at a duly convened general
meeting of the Company and successful completion of the redemption of the
Group's 10% membership interest in TSHII, we received, in aggregate, gross
proceeds of $1.575m in cash, thereby enabling us to settle the Group's then
outstanding trade creditors and secure essential additional working capital.
We are currently in discussions with Endeavor with respect to how best to
formulate the Additional Lease.
On the ground, our partners Valkor began to drill for oil on neighbouring
state lands, having secured permits from the Utah regulators for them to
operate on those areas and on our AC Oil lease. Valkor experienced practical
difficulties in the first few months of drilling, including a problem with
heating the tar underground so that oil could readily be pumped to surface.
They have ended up using a different heater in December 2024 that appears to
be yielding much better results. We hope to finalise terms for Valkor to
commence drilling on our adjacent AC Oil lease, subject to finance, in the
first half of 2025. All being well, this should generate revenue for the
Group.
TurboShale RF Technology
The potential future exploitation of the Company's legacy TurboShale and Oil
Mining Company assets, which are fully impaired from an accounting
perspective, will be reassessed when appropriate in due course. With a more
positive and supportive political backdrop in the USA, the oil and gas
industry continues to evolve with the application of increasingly advanced
technological solutions. Time may therefore well be our friend in this regard.
Corporate Review
Whilst seeking to carefully manage our cash reserves and working capital
position, the Company has undertaken a number of financing transactions
throughout the year to progress its development plans for Greenfield, satisfy
general overheads and repay certain indebtedness.
In summary, such transactions have comprised:
- October 2023: equity subscription to raise £0.1m gross at a price
of 0.08p per share.
- January 2024: equity subscription to raise £0.05m gross at a price
of 0.10p per share.
- February 2024: equity placing and subscription to raise, in
aggregate, £0.3m gross at a price of 0.045p per share.
Maintaining a tight control over overhead costs is a constant theme for
pre-revenue project development companies such as TomCo, particularly during
periods of high inflation. Your Board believes that the potential
participation in drilling on the Group's Lease offers the best prospect of
revenue generation in the near term whilst Greenfield's tar sands development
project affords the possibility of significant returns over a longer-term
horizon, subject to securing the requisite project financing. Alongside our
focus on these key strategic initiatives, we intend to continue to identify
and evaluate appropriate new project opportunities to potentially expand the
Company's asset portfolio going forwards.
Accordingly, I believe there are good grounds for optimism over the remainder
of 2025 and beyond and we look forward to updating shareholders on our future
progress.
Malcolm Groat
Executive Chairman
10 March 2025
DIRECTORS' REPORT
The Directors submit their report and the financial statements of the Group
for the year ended 30 September 2024
PRINCIPAL ACTIVITY AND REVIEW OF THE BUSINESS
The principal activity of the Group is that of seeking to exploit the heavy
oil contained in the Group's AC Oil Lease, and to extract and process oil
sands resources from an additional lease area, still to be defined, on TSHII's
wider site, through the use of separation technology to achieve sustained
future production. A review of the Group's business is included within the
Chairman's statement.
RISK ASSESSMENT
The Group's oil and gas activities are subject to a range of financial and
operational risks which can significantly impact on its performance, with the
key risks for the year ended 30 September 2024 set out below.
Operational risk
As set out in the Chairman's statement, in August 2024 the Board agreed to
sell the Group's 10% minority interest in Tar Sands Holdings II LLC on the
basis that (a) it would not impact on the Group's pre-existing lease with
TSHII held by AC Oil to drill for oil on the property and (b) TSHII and its
proposed new owners are required to use best endeavours to agree terms under
which the Group's principal subsidiary, Greenfield, could potentially mine and
process oil sands on additional areas of TSHII's site not required for the new
owners planned refurbished refinery. We are currently investigating how best
to proceed with developing some potential in situ wells on the existing lease
area in conjunction with our partners, Valkor, albeit no formal agreement has
been reached and additional funding will be required. We are also exploring
with the proposed new owners of TSHII how to crystallise our mining rights
whilst they finalise exactly what land area they will need to reserve for
their separate development plans and own purposes. The ability to mine such
additional oil sands would provide feed stock for our planned future oil
separation plants for which, frustratingly, no appropriate financing package
has yet been forthcoming. There can be no certainty that a suitable funding
arrangement can be successfully concluded nor as to the precise terms and
structure of any such funding package and the Group will continue to explore
and assess a number of potential funding sources.
The Group continues to operate with a small team, on which it is highly
reliant. Information is openly shared within the team to ensure no over
reliance on specific individuals.
Risks relating to environmental, health and safety and other regulatory
standards
The Group's proposed future extraction activities are subject to various US
federal and state laws and regulations relating to the protection of the
environment including the obtaining of appropriate permits and approvals by
relevant environmental authorities. Such regulations typically cover a wide
variety of matters including, without limitation, prevention of waste,
pollution and protection of the environment, labour regulations and worker
safety. Furthermore, the future introduction or enactment of new laws,
guidelines and regulations could serve to limit or curtail the growth and
development of the Group's business or have an otherwise negative impact on
its planned operations. The Group ensures that it complies with the relevant
laws and regulations in force in the jurisdictions in which it operates.
Liquidity and interest rate risks
The Group is ultimately dependent on sources of additional equity and/or debt
funding to develop Greenfield and any of the Group's other exploration assets
and/or technology and to meet its day-to-day capital commitments and
overheads. Cash forecasts identifying the liquidity requirements of the Group
are produced frequently and are reviewed regularly by management and the
Board. This strategy will continually be reviewed in light of existing project
developments and new project opportunities as they arise. For further
information regarding the Group's cash reserves and future funding
requirements, please refer to the 'Going Concern' section below.
Currency risk
Due to the limited income and expenses denominated in foreign currencies, it
was not considered cost effective to manage transactional currency exposure on
an active basis. Consequently, as the financial statements are reported in
sterling, any movements in the exchange rate of foreign currencies against
sterling may affect the Group's statements of comprehensive income and
financial position. The Group holds some cash in US dollars to mitigate the
foreign exchange risk and keeps its currency profile under regular review.
Financial instruments
It was not considered appropriate for the Group to enter into any hedging
activities or trade in any financial instruments in 2024. Further information
is set out in Note 20.
RESULTS AND DIVIDENDS
The statement of comprehensive income is set out with the Group reporting a
loss before taxation for the year of £6.34m (2023: £2.35m). The Directors do
not propose the payment of a dividend (2023: £nil).
Directors
The Directors who served on the Board during the year to 30 September 2024 and
to date were as follows:
Malcolm Groat
John Potter (passed away on 24 May 2024)
Louis Castro
Zac Phillips
Directors' interests in the ordinary shares of the Company, including family
interests, as at 30 September 2024 were as follows:
30 September 2024 30 September 2023
Ordinary shares of nil par value Share warrants Share options Ordinary shares of nil par value Share warrants Share options
M. Groat 11,887 - 20,380,952 11,887 - 20,380,952
J. Potter - - - 26,500 - 52,714,285
L. Castro - - 15,000,000 - - 15,000,000
Z. Phillips - - - - - -
11,887 - 35,380,952 38,387 - 88,095,237
Details of the Directors' remuneration, share warrants and share options can
be found in the Remuneration Committee Report and Notes 6, 18 and 19 to these
financial statements.
Significant shareholders
At the date of issuing this report, the Directors are aware of the following
shareholdings of 3% or more of the Company's existing issued ordinary share
capital:
Shareholder No. of ordinary % of issued
shares held ordinary shares
Interactive Investor Services Nominees Limited 1,157,123,377 29.64
Hargreaves Landsdown (Nominees) Limited 295,970,210 7.58
HSDL Nominees Limited 335,776,128 8.60
Barclays Direct Investing Nominees Limited 246,998,493 6.33
Idealing Nominees Limited 223,651,213 5,72
Lawshare Nominees Limited 208,573,048 5.34
Vidacos Nominees Limited 165,755,290 4.25
Morgan Stanley Client Securities Nominees Limited 148,907,215 3.81
Interactive Brokers LLC 121,889,823 3.12
Payments of payables
The Group's policy is to negotiate payment terms with its suppliers in all
sectors to ensure that they know the terms on which payment will take place
when the business is agreed and to abide by those terms of payment.
Going Concern
At 31 January 2025, the Group had cash reserves of approximately £0.64
million.
The Group's financial statements have been prepared on a going concern basis,
which presumes that the Group will be able to meet its obligations as they
fall due for the foreseeable future.
The Directors have prepared a cash flow forecast for the twelve months to 10
March 2026 which shows that at the current burn rate the Group will have
sufficient funds for such period.
On 30 November 2022, the terms of the historic loan from our partners Valkor
(the "Valkor Loan"), which is unsecured, were varied such that the loan is
only repayable on completion of a suitable funding transaction for Greenfield
that provides sufficient funds to enable the Company to affect such repayment.
Hence, the abovementioned cash flow forecast does not include any repayment of
the Valkor Loan due to the uncertainty regarding consummation of a suitable
financing package for Greenfield.
The forecast, which includes all commitments at the date of this report
indicates that the Group will not need to secure any additional finance to
meet its currently envisaged working capital requirements for the twelve
months to 10 March 2026. Should any unplanned expenditures arise or
participation by the Group in the drilling of potential production wells
occur, then further funding will be required as appropriate. Based on
historical support from new and existing investors and debt providers, the
Board reasonably believes that additional funding can be obtained when
required, via further debt or equity issuances such that it continues to
consider it appropriate to prepare the Group's financial statements on a going
concern basis. However, the Board's ability to raise such funds cannot be
guaranteed. As a consequence, there is a material uncertainty as to the going
concern status of the Group. The financial statements do not include the
adjustments that would result if the Group was unable to continue as a going
concern.
The Directors' consideration of the Group's going concern status is also set
out in note 1.3 to the financial statements.
Directors' responsibilities
The directors are responsible for preparing the Annual Report and the
financial statements in accordance with applicable law and regulations.
The directors have resolved to prepare financial statements for each financial
year end and have elected to prepare financial statements in accordance with
UK-adopted International Accounting Standards. The financial statements are
required to give a true and fair view of the state of the affairs of the
Company and of the profit or loss of the Company for that period.
In preparing these financial statements, the directors are required to:
· consistently select and apply appropriate accounting
policies;
· present information, including accounting policies, in
a manner that provides relevant, reliable, comparable and understandable
information;
· provide additional disclosures when compliance with the
specific requirements in International Financial Reporting Standards is
insufficient to enable users to understand the impact of particular
transactions, other events and conditions on the entity's financial position
and financial performance; and
· state that the Group has complied with International
Financial Reporting Standards, subject to any material departures disclosed
and explained in the financial statements.
The Directors confirm that they have complied with these requirements, and,
having a reasonable expectation that the Group has and will have adequate
resources to continue in operational existence for the foreseeable future,
have continued to adopt the going concern basis in preparing the financial
statements.
Website publication
The directors are responsible for ensuring that the annual report and
financial statements are made available on a website. Financial statements are
published on the Company's website in accordance with legislation in the Isle
of Man governing the preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions. The maintenance and
integrity of the Company's website is the responsibility of the directors. The
directors' responsibility also extends to the on-going integrity of the
financial statements contained therein.
Auditors
All of the current Directors have taken all the steps that they ought to have
taken to make themselves aware of any information needed by the Company's
auditors for the purposes of their audit and to establish that the auditors
are aware of that information. The Directors are not aware of any relevant
audit information of which the auditors are unaware.
PKF Littlejohn LLP have expressed their willingness to continue in office and
a resolution to re-appoint them will be proposed at the Company's next annual
general meeting.
By order of the Board
Malcolm Groat
Executive Chairman
10 March 2025
CORPORATE GOVERNANCE STATEMENT
As Chairman, I am pleased to present the Company's Governance Statement under
the QCA Corporate Governance Code (the "QCA Code"). Establishing effective
corporate governance structures that evolve with the business and protect
shareholder value is a key element of my role, together with the Board as a
whole. Set out below are details of the Company's governance framework
benchmarked against the QCA Code principles.
The Board of Directors of TomCo (the "Board") monitors the business affairs of
the Company and its subsidiaries on behalf of its shareholders. The Board
currently consists of the Executive Chairman and two Non-Executive Directors.
None of the Non-Executive Directors have previously held an executive position
with the Company. The Directors have responsibility for the overall corporate
governance of the Company and recognise the need for the highest standards of
behaviour and accountability. The Directors are committed to the principles
underlying best practice in corporate governance and have adopted the QCA
Code.
This statement explains, at a high level, how the QCA Code is applied by the
Company and how its application supports the Company's medium to long-term
development. Further information on the application of the QCA Code can be
found on the Company's website at
https://tomcoenergy.com/investors/governance/.
The Board is responsible for the stewardship of the Company through
consultation with the management of the Company. Management comprises the
Executive Chairman. Any responsibility that is not delegated to management or
to the specific committees of the Board remains with the Board, subject to the
powers of shareholder meetings. The frequency of Board meetings, as well as
the nature of agenda items, varies depending on the state of the Company's
affairs and in light of the opportunities or risks which the Company faces.
Members of the Board are in frequent contact with one another, and meetings of
the Board are held as deemed necessary.
Statement of compliance with the QCA Code
Throughout the year ended 30 September 2024, the Company has been in
compliance with the provisions set out in the QCA Code.
Application of the QCA Code principles
The Company has applied the principles set out in the QCA Code, by complying
with it as reported above. Further explanations of how the principles have
been applied is set out below.
Principle One - Business Model and Strategy
In September 2024, TomCo completed the redemption of its 10% minority
membership interest in Tar Sands Holdings II LLC ("TSHII") but retained its
leased acreage from TSHII via AC Oil on which it intends, subject to, inter
alia, securing the requisite funding, to participate in the drilling of one or
more in situ oil production wells alongside its partner Valkor. The Company
also intends to seek to agree terms with the proposed new owners of TSHII, to
enable its subsidiary, Greenfield, to potentially mine oil sands on an
additional lease area thereby providing feed stock for potential future oil
separation plants, the construction of which is again dependent on ultimately
being able to secure sufficient funding.
Principle Two - Understanding Shareholder Needs and Expectations
The Board is committed to maintaining good communications and having
constructive dialogue with its shareholders. Shareholders and analysts have
the opportunity to discuss issues and provide feedback at meetings with the
Company and management.
All shareholders are encouraged to attend and participate in shareholder
meetings duly convened by the Company, in particular its Annual General
Meeting (AGM). Investors also have access to current information on the
Company and the Group through the Company's website at: www.tomcoenergy.com.
Principle Three - Considering Wider Stakeholder and Social Responsibilities
The Board recognises that the long-term success of the Group is reliant upon
the efforts of the employees of the Group, its partners, consultants,
contractors, suppliers, regulators and other stakeholders. The Board have put
in place a range of processes and systems to ensure that there is close
oversight and contact with its key stakeholders.
The Group is subject to oversight by a number of different U.S. State and
other regulatory bodies, who directly or indirectly are involved with the
permitting and approval process for its oil and gas operations in Utah,
including those conducted by Greenfield. Additionally, given the nature of the
Group's business, including the activities of Greenfield there are other
parties who, whilst not having regulatory power, nonetheless have an interest
in seeing that the Group conducts its operations in a safe, environmentally
responsible, ethical and conscientious manner.
The Group makes all reasonable efforts, directly or through its advisers, to
engage in and maintain active dialogue with each of these governmental and
non-governmental bodies, to ensure that any issues faced by the Group,
including but not limited to regulations or proposed changes to regulations,
are well understood and ensuring to the fullest extent possible that the Group
is in compliance with all relevant regulations, standards and specific
licensing obligations, including environmental, social and safety aspects, at
all times.
Principle Four - Risk Management
In addition to its other roles and responsibilities, the Board is responsible
for ensuring that procedures are in place and are being implemented
effectively to identify, evaluate and manage the significant risks faced by
the Group.
As a result of the process described above, a number of risks have been
identified. The principal risks and the manner in which the Company and its
Board seek to mitigate them are set out below. The Board reviews the principal
risks facing the business as part of its meetings throughout the year and
changes to those risks as the Company develops. Where risks change or new
risks are identified the Board amends existing or implements new risk
management strategies as applicable.
Risk Comment Mitigation
Operational risks See Directors' Report. In August 2024, the Company announced that it had agreed to sell its 10%
minority membership interest in Tar Sands Holdings II LLC on the basis that
(a) it would not impact on the Group's pre-existing lease (held via AC Oil) to
drill for oil on the property and (b) the proposed new owners and TSHII are
required to use their best endeavours to agree terms for an additional lease
for Greenfield whereby it could potentially mine and process oil sands on
additional areas of TSHII's site not required for the acquirer's planned
refurbished refinery. We are currently investigating how best to proceed with
developing some potential in situ wells on the existing lease area in
conjunction with our partners, Valkor, albeit no formal agreement has been
reached and additional funding will be required. The Company is also exploring
with the proposed new owners of TSHII how to crystallise its mining rights
whilst they finalise exactly what land area they will need to reserve for
their separate development plans and own purposes. The ability to mine such
additional oil sands would provide feed stock for our planned future oil
separation plants although this remains subject to suitable financing. There
can be no certainty that a suitable funding arrangement can be successfully
concluded nor as to the precise terms and structure of any such funding
package and the Company will continue to explore and assess a number of
potential funding sources.
Environmental, health and safety and other regulatory standards See Directors' Report. The Company has engaged leading advisers to assist it in maintaining relevant
permits or licences to operate.
The Company maintains ongoing oversight of health and safety and environmental
compliance.
Liquidity risk See Directors' Report including 'Going Concern' section. The Company maintains a detailed cashflow forecast and carefully monitors
expenditure and seeks to raise additional funding as required and as referred
to in Note 1.3.
Currency risk See Directors' Report. The Company aims to manage currency exposures by holding funds in the
applicable currency to match anticipated expenditure.
The Board considers that an internal audit function is not necessary or
practical due to the current size of the Group and the close day to day
control exercised by the Executive Chairman. However, the Board will continue
to monitor the need for an internal audit function. The Executive Chairman has
established appropriate reporting and control mechanisms to ensure the
effectiveness of the Group's control systems for the size of the business and
its activities. The Board obtains regular updates on risks from the Executive
Chairman, which allows it to monitor the effectiveness of risk management and
through its regular engagement and review of reporting on areas such as the
status of the Company's projects, budgets, results and cash flow position of
the Company, it considers the effectiveness of controls on an ongoing basis.
Principle Five - A Well-Functioning Board of Directors
The Board currently comprises an Executive Chairman, Malcolm Groat, and two
independent Non-Executive Directors, Louis Castro and Zac Phillips.
Biographies for each of the current Directors are set out on the Company's
website. The Directors are subject to re-election usually at the Company's
Annual General Meeting, at intervals of no more than three years.
The Board meets on a regular basis, typically at least once a month.
The Board is responsible for formulating, reviewing and approving the Group's
strategy, budgets and corporate actions. As such, the Company has established
separate Audit and Remuneration Committees.
The Audit Committee comprises Louis Castro (Chairman) and Zac Phillips. The
Audit Committee meets at least twice a year to consider the integrity of the
financial statements of the Company, including its annual and interim
accounts; the effectiveness of the Company's internal controls and risk
management systems; auditor reports; and terms of appointment and remuneration
for the auditor.
The Company's Remuneration Committee comprises Louis Castro (Chairman) and Zac
Phillips. The Remuneration Committee meets from time to time, but not less
than once a year, to review and determine, amongst other matters, the
remuneration of Executives on the Board and any share incentive plans of the
Company.
The QCA Code recommends that the Chairman must have adequate separation from
the day-to-day business to be able to make independent decisions. The Board
comprises three members, Malcolm Groat who is the Executive Chairman and two
non-executive directors. It is the non-executive directors, who are in the
majority, who have adequate separation from the day-to day business and ensure
that the Board can, overall, make decisions independent of the executive
function. As the Board is comprised of only three members, one of whom is an
Executive and two of whom are independent Non-Executive Directors, the Board
does not believe it is currently necessary to appoint a senior independent
director.
Whilst each of the Non-Executive Directors are considered to be part time,
they are expected to provide as much time to the Company as is required. The
attendance record of the Directors at Board and committee meetings held during
the year ended 30 September 2024 was as follows:
Main Board Audit Remuneration
Committee Committee
Meetings held 11 3 1
Attendance:
Malcolm Groat 11 2 1
John Potter 3 - -
Louis Castro 11 3 1
Zac Phillips 11 3 1
Principle Six - Appropriate Skills and Experience of the Directors
The Board believes that the current balance of skills held by the Board as a
whole, reflects a very broad range of commercial and professional skills
across geographies and industries and each of the Directors has previous
experience of public markets.
The Board believes that the Directors are well suited to the Company's
fundamental objective of enhancing and preserving long-term shareholder value
and ensuring that the Group conducts its business in an ethical and safe
manner. The Board is considered to be of a sufficient size to provide more
than adequate experience and perspective to its decision-making process and,
given the size and nature of the Group, the Board does not consider at this
time that it is appropriate to increase the size of the Board or amend its
composition.
As the Board is not currently anticipating any change to its size or
composition, it has not yet implemented a written policy regarding the
identification and nomination of female directors. In the event that one of
the existing members of the Board stands down from their current position, the
Company will, at that time, give further consideration to the specific
selection of a female member of the Board and the adoption of a formal policy
relating to the positive appointment of additional female members of the Board
for future opportunities.
The Board is responsible for: (a) ensuring that all new Directors receive a
comprehensive orientation, that they fully understand the role of the Board
and its committees, as well as the contribution individual directors are
expected to make (including the commitment of time and resources that the
Company expects from its directors) and that they understand the nature and
operation of the Group's business; and (b) providing continuing education
opportunities for all directors, so that individuals may maintain or enhance
their skills and abilities as directors, as well as to ensure that their
knowledge and understanding of the Group's business remains current.
Given the size of the Company and the in-depth experience of its Directors,
the Board has not deemed it necessary to develop a formal process of
orientation for new Directors but encourages all its Directors to visit the
Group's operations to ensure familiarity and proper understanding.
Skills & Experience of Board Members
Malcolm Groat
Malcolm is a Chartered Accountant and has extensive corporate experience, with
roles as Chairman, Non-Executive Director, Chairman of Audit Committees, CEO,
COO and CFO for a number of public companies. He is an adviser on compliance
and governance, strategy and operational improvement, and managing the risks
of rapid change.
Louis Castro
Louis is a graduate engineer and PwC trained Chartered Accountant who has
spent his career in the City in investment banking, with SG Warburg (now UBS),
and in capital markets, advising growth companies on a wide range of matters
including fund-raising and M&A. He served as an AIM Nomad for many years
before becoming CFO of a listed oil company. In recent years, Louis became
Executive Chairman of Orosur Mining Inc. which is quoted on both the TSX-V and
on AIM, and he is also a non-executive director of Tekcapital plc and
Innovative Eyewear, Inc.
Zac Phillips
Zac has over 25 years' experience in oil and gas finance, having worked for
BP, Chevron, Merrill Lynch and ING Barings. He was previously CFO for Dubai
World's oil and gas business (DB Petroleum) with responsibility for risk
management and authoring of investment proposals. He has a degree in Chemical
Engineering and a PhD in Chemical Engineering from Bath University.
Principle Seven - Evaluation of Board Performance
The Board has determined that it shall be responsible for assessing the
effectiveness and contributions of the Board as a whole and its committees
(which currently comprise the Audit Committee and the Remuneration Committee).
The small size of the Board allows for open discussion.
No formal assessments have been prepared in the year. However, the Board
assesses its effectiveness on an ongoing basis. The Board will keep this
matter under review and especially if either the size of the Board or the
number of committees increases, which in turn may require a more formalised
assessment and evaluation process to be established to ensure continued
effectiveness.
Principle Eight - Corporate Culture
The Board recognises that their decisions regarding strategy and risk will
impact the corporate culture of the Group as a whole and that this will have
an effect on the performance of the Group. The Board is very aware that the
tone and culture set by the Board will greatly impact all aspects of the
Group. The corporate governance arrangements that the Board has adopted are
designed to ensure that the Group delivers long-term value to its shareholders
and that shareholders have the opportunity to express their views and
expectations for the Company in a manner that encourages open dialogue with
the Board.
A large part of the Group's activities is centred upon what needs to be an
open and respectful dialogue with partners, suppliers, consultants and other
stakeholders. Therefore, the importance of sound ethical values and behaviour
is crucial to the ability of the Group to successfully achieve its corporate
objectives.
The Directors consider that, at present, the Group has an open culture
facilitating comprehensive dialogue and feedback and enabling positive and
constructive challenge.
Principle Nine - Maintenance of Governance Structures and Processes
Ultimate authority for all aspects of the Group's activities rests with the
Board, with the responsibilities of the Executive Chairman arising as a
consequence of delegation by the Board.
The Board has adopted appropriate delegations of authority which set out
matters which are reserved to the Board. The Executive Chairman, together with
the two non-executives, is responsible for the effectiveness of the Board and
compliance with the QCA Code. Management of the Group's business and primary
contact with shareholders has been delegated by the Board to the Executive
Chairman.
Non-Executive Directors
The Board evaluates its performance and composition on a regular basis and
will make adjustments as and when required. When assessing the independence of
each Non-Executive Director, length of service is one of the considerations.
The Board will, when assessing new appointments in the future, consider the
need to balance the experience and knowledge that each independent director
has of the Group and its operations, with the need to ensure that independent
directors can also bring new perspectives to the business.
In accordance with the Isle of Man Companies Act 2006, the Board complies
with: a duty to act within their powers; a duty to promote the success of the
Company; a duty to exercise independent judgement; a duty to exercise
reasonable care, skill and diligence; a duty to avoid conflicts of interest; a
duty not to accept benefits from third parties and a duty to declare any
interest in a proposed transaction or arrangement.
Principle Ten - Shareholder Communication
The Board is accountable to the Company's shareholders and, as such, it is
important for the Board to appreciate the aspirations of shareholders and
equally that shareholders understand how the actions of the Board and
short-term financial performance relate to the achievement of the Group's
longer-term goals.
The Board reports to the Company's shareholders on its stewardship of the
Group through the publication of interim and final financial results. The
Company announces significant developments which are disseminated via various
outlets including, before anywhere else, the London Stock Exchange's
regulatory news service (RNS). In addition, the Company maintains a website
(www.tomcoenergy.com) on which RNS announcements, press releases, corporate
presentations and the Report and Financial Statements are available to view.
Enquiries from individual shareholders on matters relating to the business of
the Group are welcomed. Shareholders and other interested parties can
subscribe to receive notification of news updates and other documents from the
Company via email.
The Annual General Meeting, and other meetings of shareholders that may be
called by the Company from time to time, provide an opportunity for
communication with all shareholders and the Board encourages shareholders to
attend and welcomes their participation. The Board is committed to maintaining
good communication and having constructive dialogue with its shareholders. The
Company has close ongoing relationships with its private shareholders.
Malcolm Groat
Executive Chairman
10 March 2025
AUDIT COMMITTEE REPORT
Overview
The Committee met three times during the year to consider the full year 2023
accounts and the interim 2024 accounts, and to review audit planning for the
full year 2024 accounts. It has also met after the year end to consider the
full year 2024 accounts.
Louis Castro is Chairman of the Committee. The other Committee members for the
first 9 months of the year under review were Malcolm Groat and Zac Phillips.
Upon Malcolm Groat being appointed Executive Chairman, on the passing of John
Potter, Malcolm Groat stepped down from this Committee.
Financial Reporting
The Committee monitored the integrity of the interim and annual financial
statements and reviewed the significant financial reporting issues and
accounting policies and disclosures in the financial reports. The external
auditor attended the Committee meeting as part of the full year accounts
approval process. The process included the consideration of reports from the
external auditor identifying the primary areas of accounting judgements and
key audit risks identified as being significant to the full year audited
accounts.
Audit Committee Effectiveness
The Board considers the effectiveness of the Committee on a regular basis but
not as part of a formal process.
External Audit
The Committee is responsible for managing the relationship with the Company's
external auditor, PKF Littlejohn LLP.
The objectivity and independence of the external auditor is safeguarded by
reviewing the auditor's formal declarations, monitoring relationships between
key audit staff and the Group and reviewing the non-audit fees payable to the
auditor. Non-audit services are not performed by the auditor. During the year,
audit fees of £45,000 (2023: £48,858) were paid.
Internal Audit
The Committee considered the requirement for an internal audit function. The
Committee considered the size of the Group, its current activities and the
close involvement of senior management. Following the Committee's review, it
did not deem it necessary to operate an internal audit function during the
year.
Louis Castro
Chairman, Audit Committee
10 March 2025
REMUNERATION COMMITTEE REPORT
This report is on the activities of the remuneration committee for the
financial year ended 30 September 2024.
The Remuneration Committee meets from time to time, but not less than once a
year, to review and determine, amongst other matters, the remuneration of the
Executive(s) on the Board and any share incentive plans of the Company.
Louis Castro is Chairman of the Committee. The other Committee members for the
first 9 months of the year under review were Malcolm Groat and Zac Phillips.
Upon Malcolm Groat being appointed Executive Chairman, on the passing of John
Potter, Malcolm Groat stepped down from this Committee.
The Directors' emoluments comprise fees paid for services. The amounts paid
for their services are detailed below:
Salaries Bonus Salaries Bonus
2024 2024 2023 2023
£'000 £'000 £'000 £'000
M. Groat 50 14 50 -
J. Potter (passed away on 24 May 2024) 131 - 253 -
L. Castro 42 14 42 -
Z. Phillips 36 14 36 -
As detailed in Note 19, the Company has in place a share option scheme for its
Directors.
The Committee met once during the year in conjunction with a Board meeting to
review salaries.
Louis Castro
Chairman, Remuneration Committee
10 March 2025
INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF TOMCO ENERGY PLC
Opinion
We have audited the group financial statements of TomCo Energy Plc (the
'group') for the year ended 30 September 2024 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated Statement of Financial
Position, the Consolidated Statement of Changes in Equity, and the
Consolidated Statement of Cash Flows and notes to the financial statements,
including significant accounting policies. The financial reporting framework
that has been applied in their preparation is UK-adopted international
accounting standards.
In our opinion, the group financial statements:
· give a true and fair view of the state of the group's affairs as
at 30 September 2024 and of its loss for the year then ended; and
· have been properly prepared in accordance with UK-adopted
international accounting standards.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor's responsibilities for the
audit of the financial statements section of our report. We are independent of
the group in accordance with the ethical requirements that are relevant to our
audit of the financial statements in the UK, including the FRC's Ethical
Standard as applied to listed entities, and we have fulfilled our other
ethical responsibilities in accordance with these requirements. We believe
that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Material uncertainty related to going concern
We draw attention to note 1.3 in the financial statements, which indicates
that while the group currently has sufficient cash flow to meet its
obligations as they fall due within the next 12 months, its ability to
continue as a going concern is dependent on the successful execution of future
projects and its ability to raise additional funds as required to either
settle existing obligations or fund any future projects. These conditions
indicate the existence of a material uncertainty that may cast significant
doubt on the group's ability to continue as a going concern. Our opinion is
not modified in respect of this matter
In auditing the financial statements, we have concluded that the director's
use of the going concern basis of accounting in the preparation of the
financial statements is appropriate.
Our evaluation of the directors' assessment of the company's ability to
continue to adopt the going concern basis of accounting included:
⦁ Obtaining management's base case forecast for the period up to 28
February 2024 and testing the mathematical accuracy of the base case forecast,
including a review of the cash position as and after the year end;
⦁ Reviewing management's assessment of going concern, including their
evaluation of future funding requirements;
⦁ Reviewing the reasonable worst-case forecast scenario prepared by
management and evaluating the financial resources available to address this
scenario; and
⦁ Critically assessing the disclosures made within the financial
statements for consistency with management's assessment of going concern.
Our responsibilities and the responsibilities of the directors with respect to
going concern are described in the relevant sections of this report.
Our application of materiality
The scope of our audit was influenced by our application of materiality. The
quantitative and qualitative thresholds for materiality determine the scope of
our audit and the nature, timing and extent of our audit procedures. Group
materiality was £35,000 (2023: £97,000) based upon 2% of expenses (2023:
1.5% of gross assets). The reason for the change during the year was due to
the Sale of TSHII meaning the Group became a cash shell. We therefore consider
expenses to be the main driver of the business as the group and the metric
that the users of the accounts will be most interested in.
Whilst materiality for the financial statements as a whole was set at £35,000
(2023: £97,000) each significant component of the Group was audited to an
overall materiality ranging between £20,000 and £25,000 (2023: £71,000 -
£74,000) with performance materiality set at 70% (2023: 70%) for all
components.
We agreed with the audit committee that we would report to the committee all
audit differences identified during the course of our audit in excess of
£1,750 (2023: £4,000) as well as differences below these thresholds that, in
our view, warranted reporting on qualitative grounds.
Our approach to the audit
In designing our audit, we determined materiality and assessed the risk of
material misstatement in the financial statements. In particular, we looked at
areas requiring the directors to make subjective judgements, for example in
respect of significant accounting estimates including the convertible loan,
and carrying value of unquoted investments. We also addressed the risk of
management override of internal controls, including evaluating whether there
was evidence of bias by the directors that represented a risk of material
misstatement due to fraud.
An audit was performed on the financial information of the group's operating
entities which for the year ended 30 September 2024 were located in the Isle
of Man and United States of America. The audit work on each significant
component was performed by us as group auditor based upon materiality or risk
profile, or in response to potential risks of material misstatement to the
Group.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the financial statements of the current
period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those
which had the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Key Audit Matter How the scope of our audit responded to the key audit matter
Carrying value of Intangible Assets (note 8).
The group has significant intangible assets, comprising predominantly of Our work in the area included:
expenditure developing know how in relation to the design and operation of an
oil sand separation plant. The carrying value of intangible assets at 30 · Review of the carrying value of intangible assets having regard
September 2024 was £nil (2023: £4,703k). to impairment indicators under IAS 38;
There is the risk that the impairment of these assets have not been correctly · Critical review of management's impairment paper and challenge of
accounted for in light of the disposal of the 10% interest in TSHII in August all key assumptions therein, as well as considerations of the impairment
2024 and the impact on the carrying value of the remaining assets. The audit indicators within IAS 36; and
team has assessed the area as a Key Audit Matter as the balance is considered
the most significant area that the users of the financial statements would be · Ensuring disclosures made in the financial statements in relation
interested in. to critical accounting judgements are adequate and in line with our
understanding of the group and its activities.
Other information
The other information comprises the information included in the annual report,
other than the financial statements and our auditor's report thereon. The
directors are responsible for the other information contained within the
annual report. Our opinion on the group financial statements does not cover
the other information and we do not express any form of assurance conclusion
thereon. Our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the course of the audit, or
otherwise appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to
determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we are
required to report that fact.
We have nothing to report in this regard.
Responsibilities of directors
As explained more fully in the directors' responsibilities statement, the
directors are responsible for the preparation of the group financial
statements and for being satisfied that they give a true and fair view, and
for such internal control as the directors determine is necessary to enable
the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the group financial statements, the directors are responsible for
assessing the group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the group or to
cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial
statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
Irregularities, including fraud, are instances of non-compliance with laws and
regulations. We design procedures in line with our responsibilities, outlined
above, to detect material misstatements in respect of irregularities,
including fraud. The extent to which our procedures are capable of detecting
irregularities, including fraud is detailed below:
· We obtained an understanding of the group and the sector in which
it operates to identify laws and regulations that could reasonably be expected
to have a direct effect on the financial statements. We obtained our
understanding in this regard discussions with management.
· We determined the principal laws and regulations relevant to the
group in this regard to be those arising from AIM Rules, relevant local laws
and regulations in the where the Group operates (Isle of Man and United
States, UK Bribery Act, QCA Corporate governance, and Permit and Environmental
compliance in the United States.
· We designed our audit procedures to ensure the audit team
considered whether there were any indications of non-compliance by the group
with those laws and regulations. These procedures included, but were not
limited to:
o Enquiries of management regarding potential non-compliance;
o Review of legal and professional fees to understand the nature of the
costs and the existence of any non-compliance with laws and regulations;
o Review of RNS announcement made to the market throughout the year; and
o Review of minutes of meetings of those charged with governance and
regulatory news service announcements.
· We also identified the risks of material misstatement of the
financial statements due to fraud. We considered, in addition to the
non-rebuttable presumption of a risk of fraud arising from management override
of controls, that the judgements and estimates made by management in their
assessment of the recoverability of intangible assets represented the most
significant risk of material misstatement. Refer to the key audit matter
above.
· As in all of our audits, we addressed the risk of fraud arising
from management override of controls by performing audit procedures which
included, but were not limited to: the testing of journals; reviewing
accounting estimates for evidence of bias; and evaluating the business
rationale of any significant transactions that are unusual or outside the
normal course of business.
Because of the inherent limitations of an audit, there is a risk that we will
not detect all irregularities, including those leading to a material
misstatement in the financial statements or non-compliance with regulation.
This risk increases the more that compliance with a law or regulation is
removed from the events and transactions reflected in the financial
statements, as we will be less likely to become aware of instances of
non-compliance. The risk is also greater regarding irregularities occurring
due to fraud rather than error, as fraud involves intentional concealment,
forgery, collusion, omission or misrepresentation.
A further description of our responsibilities for the audit of the financial
statements is located on the Financial Reporting Council's website at:
http://www.frc.org.uk/auditorsresponsibilities
(http://www.frc.org.uk/auditorsresponsibilities)
(http://www.frc.org.uk/auditors/audit-assurance/auditor-s-responsibilities-for-the-audit-of-the-fi/description-of-the-auditor%E2%80%99s-responsibilities-for)
(https://www.frc.org.uk/auditors/audit-assurance/standards-and-guidance/2010-ethical-standards-for-auditors-(1))
. This description forms part of our auditor's report.
Use of our report
This report is made solely to the company's members, as a body, in accordance
with our engagement letter. Our audit work has been undertaken so that we
might state to the company's members those matters we are required to state to
them in an auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone, other
than the company and the company's members as a body, for our audit work, for
this report, or for the opinions we have formed.
Zahir Khaki (Engagement
Partner)
15 Westferry Circus
For and on behalf of PKF Littlejohn
LLP
Canary Wharf
Statutory
Auditor
London E14 4HD
10 March 2025
Consolidated Statement of Comprehensive Income for the financial year ended 30
September 2024
2024 2023
Note £'000 £'000
Revenue 2 - -
Other Income 2 - 109
Gross profit/(loss) - 109
Impairment losses 2 (4,269) -
Administrative expenses 2 (854) (1,081)
Foreign exchange (losses)/gains (817) (610)
Operating loss 4 (5,940) (1,582)
Finance costs 3 (59) (764)
Loss on disposal of investment at fair value through profit and loss 10 (336) -
Loss on ordinary activities before taxation (6,335) (2,346)
Taxation 5 - -
Loss for the year attributable to:
Equity shareholders of the parent (6,335) (2,346)
(6,335) (2,346)
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations 348 (26)
Other comprehensive income for the year attributable to equity shareholders of 348 (26)
the parent
Total comprehensive loss attributable to equity shareholders of the parent (5,987) (2,372)
2024 2023
Pence Pence
Loss per share attributable to equity shareholders of the parent per per
share share
Basic & diluted loss per share 7 (0.17) (0.10)
The Notes form part of these financial statements.
Consolidated Statement of Financial Position as at 30 September 2024
Group Group
2024 2023
Note £'000 £'000
Assets
Non-current assets
Intangible assets 8 - 4,703
Property, plant and equipment 9 - -
Investments at FVTPL 10 - 1,637
Other receivables 11 65 40
65 6,380
Current assets
Trade and other receivables 11 40 34
Cash and cash equivalents 12 857 62
897 96
TOTAL ASSETS 962 6,476
Liabilities
Current liabilities
Loans 13 (462) (445)
Trade and other payables 14 (147) (123)
(609) (568)
Net current assets/(liabilities) 288 (472)
TOTAL LIABILITIES (609) (568)
Total net assets 353 5,908
Shareholders' equity
Share capital 16 - -
Share premium 17 35,318 34,886
Warrant reserve 18 225 390
Translation reserve 123 (225)
Retained deficit (35,313) (29,143)
Equity attributable to owners of the parent 353 5,908
Total equity 353 5,908
The financial statements were approved and authorised for issue by the Board
of Directors on 10 March 2025.
The Notes form part of these financial statements.
Malcolm Groat Louis Castro
Executive
Chairman
Non-Executive Director
Consolidated Statement of Changes in Equity for the financial year ended 30
September 2024
Equity attributable to equity holders of the parent
Note Share capital Share premium Warrant reserve Translation reserve Retained Deficit Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 October 2022 - 32,527 1,374 (199) (28,290) 5,412
Loss for the year - - - - (2,346) (2,346)
Comprehensive loss for the year - - - (26) - (26)
Total comprehensive loss for the year - - - (26) (2,346) (2,372)
Issue of shares (net of costs) 16,17 - 2,359 32 - - 2,391
Issue of finance - - 193 - - 193
Expiry of warrants 18 - - (1,209) - 1,209 -
Expiry of conversion options - - - - 284 284
At 30 September 2023 - 34,886 390 (225) (29,143) 5,908
Loss for the year - - - - (6,335) (6,335)
Comprehensive income for the year - - - 348 - 348
Total comprehensive loss for the year - - - 348 (6,335) (5,987)
Issue of shares (net of costs) 16,17 - 432 - - - 432
Expiry of warrants 18 - - (165) - 165 -
At 30 September 2024 - 35,318 225 123 (35,313) 353
The following describes the nature and purpose of each reserve within owners'
equity:
Reserve
Descriptions and purpose
Share capital Amount
subscribed for share capital at nominal value, together with transfers to
share premium upon redenomination of the shares to nil par value.
Share premium Amount subscribed for
share capital in excess of nominal value, together with transfers from share
capital upon redenomination of the shares to nil par value.
Warrant reserve Amounts credited to
equity in respect of warrants to acquire ordinary shares in the Group.
Translation reserve Gains and losses on the
translation of foreign operations.
Retained deficit Cumulative net gains
and losses recognised in the consolidated statement of comprehensive income
less transfers to retained deficit on expiry.
The Notes form part of these financial statements.
Consolidated Statement of Cash Flows for the financial year ended 30 September
2024
Note Group Group
2024 2023
£'000 £'000
Cash flows from operating activities
Loss before tax 2 (6,335) (2,346)
Adjustments for:
Finance costs 3 59 764
Unrealised foreign exchange losses 772 581
Impairment provisions 4,269 -
Loss on disposal of investment 336 -
(Increase)/decrease in trade and other receivables (8) 46
Increase/(decrease) in trade and other payables 25 (221)
Cash used in operations (882) (1,176)
Interest paid - (87)
Net cash outflow from operating activities (882) (1,263)
Cash flows from investing activities
Investment in intangibles 8 - (202)
Sale of investments at FVTPL 10 1,245 -
Net cash generated from/(used in) investing activities 1,245 (202)
Cash flows from financing activities
Issue of equity instruments 16,17 450 1,425
Costs of share issue (18) (84)
Repayment of loan finance - (580)
Convertible loans - 625
Costs of convertible loans - (65)
Net cash generated from financing activities 432 1,321
Net increase/ (decrease) in cash and cash equivalents 795 (144)
Cash and cash equivalents at beginning of financial year 62 206
Cash and cash equivalents at end of financial year 857 62
The Notes form part of these financial statements.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2024
1. Accounting policies
The principal accounting policies adopted in the preparation of these
financial statements are set out below. These policies have been consistently
applied to all years presented, unless otherwise stated.
1.1 Basis of preparation
The financial statements have been prepared in accordance with UK-adopted
International Accounting Standards.
The financial statements are presented in GBP. The Company's functional
currency is also GBP and has been assessed by the Directors based on
consideration of the currency and economic factors that mainly influence the
Company's investments, operating costs, financing and related transactions.
Changes to these factors may have an impact on the judgement applied in the
determination of the Company's functional currency.
Assets and liabilities in foreign currencies are translated into sterling at
the rate of exchange ruling at the balance sheet date. Transactions in foreign
currencies are translated into sterling at the rate of exchange ruling at the
date of transaction. Foreign exchange differences arising on translation are
recognised in profit or loss.
The preparation of financial statements in conformity with UK-adopted
International Accounting Standards requires the use of certain critical
accounting estimates. It also requires management to exercise its judgement in
the process of applying the Company's accounting policies. The areas involving
a higher degree of judgement or complexity, or areas where assumptions and
estimates are significant to the financial statements are disclosed in note
1.2.
The Group's financial statements have been prepared in accordance with
UK-adopted International Financial Reporting Standards ("IFRS") and with those
parts of the Isle of Man Companies Act 2006 applicable to companies reporting
under IFRSis. The financial statements have been prepared under the historic
cost convention, except where IFRS requires assets and liabilities to be
stated at fair value.
1.2 Critical Estimates and Judgements
The preparation of financial statements in conformity with IFRS requires the
use of estimates and assumptions. Although these estimates are based on
management's best knowledge of the amount, event or actions, actual results
ultimately may differ from those estimates. Details of the Group's significant
accounting judgments are set out in these financial statements and include:
Judgements and estimates
- Internally generated development assets
Following the redemption of the Group's 10% interest in Tar Sands Holdings II
LLC ("TSHII") during the financial year, the directors have determined that a
full impairment provision against its Oil Sands Technology and related assets
is appropriate at 30 September 2024. The reasons for this decision are:
a) given the uncertainties concerning obtaining appropriate project
financing for Greenfield, highlighted in the directors' report, there is doubt
as to the availability of adequate financial resources to develop and use its
previously capitalised assets such that the directors cannot determine
reliably their value in use; and
b) in the current conditions, there is uncertainty concerning the fair
value less costs to sell of the assets concerned.
Estimates
- Share based payments
Estimates were required in determining the fair value of share warrants
granted in the year including future share price volatility and the instrument
life. Volatility is estimated using TomCo's historic share prices for a period
of time that matches the exercise period of the warrant or option concerned.
This assumes that historic share price volatility is the best estimate of
future volatility. The Black-Scholes model is used for valuing the warrants.
Estimates are also made of the likely time of exercise of the warrants.
In 2021, the Company acquired the remaining 50% of Greenfield. The wholly
deferred consideration comprised the potential issue of 592.8 million new
ordinary shares to Valkor, contingent on the receipt by the Group of third
party funding via a loan or credit facility for the construction of an oil
sands processing facility by 25 August 2024. No such loan or credit facility
was secured by such date, such that the obligation to issue the consideration
shares has now lapsed. Nevertheless, under IFRS 2 there is no reversal of the
original credit to reserves of £1.063 million which represents the estimate
of the fair value of the contingent issue, determined by reference to the cost
of the assets acquired.
1.3 Going concern
At 31 January 2025, the Group had cash reserves of approximately £0.64
million.
The Group's financial statements have been prepared on a going concern basis,
which presumes that the Group will be able to meet its obligations as they
fall due for the foreseeable future.
The Directors have prepared a cash flow forecast for the twelve months to 10
March 2026 which shows that at the current burn rate the Group will have
sufficient funds for such period.
On 30 November 2022, the terms of the historic loan from our partners Valkor
(the "Valkor Loan"), which is unsecured, were varied such that the loan is
only repayable on completion of a suitable funding transaction for Greenfield
that provides sufficient funds to enable the Company to affect such repayment.
Hence, the abovementioned cash flow forecast does not include any repayment of
the Valkor Loan due to the uncertainty regarding consummation of a suitable
funding package for Greenfield.
The forecast, which includes all commitments at the date of this report,
indicates that the Group will not need to secure any additional finance to
meet its currently envisaged working capital requirements for the twelve
months to 10 March 2026. Should any unplanned expenditures arise or
participation by the Group in the drilling of one or more productions wells
occur then further funding will be required as appropriate. Based on
historical support from new and existing investors and debt providers, the
Board reasonably believes that additional funding can be obtained when
required, via further debt or equity issuances such that it continues to
consider it appropriate to prepare the Group's financial statements on a going
concern basis. However, the Board's ability to raise such funds cannot be
guaranteed. As a consequence, there is a material uncertainty as to the going
concern status of the Group. The financial statements do not include the
adjustments that would result if the Group was unable to continue as a going
concern.
1.4 Future changes in accounting standards
The following standards have been published and are mandatory for accounting
periods beginning after 1 January 2025 but have not been early adopted by the
Group:
i. Amendments to IAS 21-Lack of exchangeability.
The following standards have been published and are mandatory for accounting
periods beginning after 1 January 2026 but have not been early adopted by the
Group:
i. Amendments to IFRS 9 and IFRS 7 - Amendments to the
classification and measurement of financial instruments; and
ii. Annual improvements of IFRS: minor amendments concerning IFRS 1,
IFRS 7, IFRS 9, IFRS 10 and IAS 7.
Management does not expect that adoption of the standards listed above will
have a material impact on the financial statements of the Group in future
periods.
1.5 Basis of consolidation
The Group's financial statements consolidate the accounts of the parent
company, TomCo Energy plc, and all of its subsidiary undertakings (see note
23) drawn up to 30 September 2024. All intra-group transactions, balances,
income and expenses are eliminated on consolidation.
The acquisition of subsidiaries where the acquisition represents the purchase
of a business is accounted for on the purchase basis. A subsidiary is
consolidated where the Company has control over an investee. The Group
controls an investee if all three of the following elements are present: power
over the investee, exposure to variable returns from the investee, and the
ability of the investor to use its power to affect those variable returns.
Control is reassessed whenever facts and circumstances indicate that there may
be a change in any of these elements of control. On acquisition, all of the
subsidiary's assets and liabilities which existed at the date of acquisition
are recorded at their fair values reflecting their condition at the time. If,
after re-assessment, the Group's interest in the net fair value of the
identifiable assets, liabilities and contingent liabilities exceeds the cost
of the business combination, the excess is recognised immediately in the
statement of comprehensive income.
Acquisitions of subsidiaries where the IFRS 3 definition of a business
combination are not met are accounted for as the purchase of relevant assets
less liabilities at cost.
1.6 Segmental reporting
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief operating
decision maker has been identified as the Board of Directors.
Based on an analysis of risks and returns, the Directors consider that the
Group has two principal business segments based on geographical location. The
loss before taxation arises principally within the UK and US. Net assets are
principally in the UK and the US.
Other Revenue
Revenue from services provided to other oil and gas exploration entities is
recognised as services are provided in accordance with the terms of the
relevant contract.
These services, which were only provided in the prior year to September 2023,
related to an agreement with Heavy Sweet Oil LLC ("Heavy Sweet Oil"), a US
based oil and gas company, to assist it with permitting and government
relations in respect of their planned drilling programme adjacent to the D
Tract of the TSHII site. Heavy Sweet Oil paid TomCo $10,000 per month for its
services, which is recorded as other income. Such agreement was suspended in
August 2023 in light of a protracted delay in securing the requisite permits.
1.7 Finance income
Finance income is accounted for on an effective interest basis.
1.8 Finance costs
Finance costs comprise two elements. Interest on debt instruments is
recognised by reference to the effective interest rate computed after the
deduction of issue costs and the separation of embedded derivatives. Finance
costs also include the change in fair value of embedded derivatives.
1.9 Property, plant and equipment
Property, plant and equipment employed in exploration and evaluation
activities are carried at cost. Following a review of the Group's current
activities, these assets remain fully impaired as at 30 September 2024.
1.10 Intangible assets
Exploration and development licences
The Group applies the full cost method of accounting for oil and gas
operations. For evaluation properties, all mineral leases, permits,
acquisition costs, geological and geophysical costs and other direct costs of
exploration appraisal, renewals and development are capitalised as intangible
fixed assets in appropriate cost pools, with the exception of tangible assets,
which are classed as property, plant and equipment. Costs relating to
unevaluated properties are held outside the relevant cost pool and are not
amortised until such time as the related property has been fully appraised.
When a cost pool reaches an evaluated and bankable feasibility stage, the
assets are transferred from intangible to oil properties within property,
plant and equipment. These assets were impaired in full during the year.
Development assets
Greenfield has incurred expenditure on researching and developing the design
and operation of a pilot plant and processes for oil sands extraction that is
not of a scale economically feasible for commercial production. Development
expenditure at acquisition was measured at cost. Development expenditure
incurred following the acquisition of Greenfield that meets the requirements
of IAS 38 for recognition as intangible assets are capitalised. All other
expenditure is expensed. No amortisation will be charged on such assets until
future commercial exploitation of the processes commences. These assets were
impaired in full during the year.
1.11 Impairment
Exploration and development licences
Exploration and development assets are assessed for impairment when facts and
circumstances suggest that the carrying amount may exceed the recoverable
amount. In accordance with IFRS 6 the Group firstly considers the following
facts and circumstances in their assessment of whether the Group's exploration
and evaluation assets may be impaired, namely whether:
- the period for which the Group has the right to explore in a
specific area has expired during the period or will expire in the near future,
and is not expected to be renewed;
- substantive expenditure on further exploration for and evaluation of
mineral resources in a specific area is neither budgeted nor planned;
- exploration for and evaluation of hydrocarbons in a specific area
have not led to the discovery of commercially viable quantities of
hydrocarbons and the Group has decided to discontinue such activities in the
specific area; and
- sufficient data exists to indicate that although a development in a
specific area is likely to proceed, the carrying amount of the exploration and
evaluation assets is unlikely to be recovered in full, either from successful
development or by sale.
1.12 Taxation
Taxation expense represents the sum of current tax and deferred tax.
Current tax is based on taxable profits for the financial period using tax
rates that have been enacted or substantively enacted by the reporting date.
Taxable profit differs from net profit as reported in the statement of
comprehensive income because it excludes items of income or expenses that are
taxable or deductible in other years and it further excludes items that are
never taxable or deductible.
Deferred tax is provided in full, using the liability method, on temporary
differences arising between the tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes. If deferred tax arises from
initial recognition of an asset or liability in a transaction other than a
business combination that at the time of the transaction affects neither
accounting nor taxable profit nor loss, it is not accounted for. Deferred tax
is determined using tax rates that have been enacted or substantively enacted
at the reporting date and that are expected to apply when the related deferred
income tax asset is realised, or the deferred tax liability is settled.
Deferred tax assets are recognised to the extent that it is probable that
future taxable profit will be available against which the temporary
differences can be utilised.
Deferred tax is provided on temporary differences arising on investments in
subsidiaries, except where the timing of the reversals of the temporary
differences is controlled by the Group and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred tax is charged or credited in the statement of comprehensive income,
except when it relates to items charged or credited directly to equity, in
which case the deferred tax is also dealt with in equity.
1.13 Foreign currencies
The accounts have been prepared in pounds sterling being the presentational
currency of the Group. The functional currency of Tomco Energy plc is also
pounds sterling. The functional currency of the US subsidiaries is US dollars.
Assets and liabilities held in the Group or overseas subsidiaries in
currencies other than the functional currency are translated into the
functional currency at the rate of exchange ruling at the reporting date.
Transactions entered into by Group entities in a currency other than the
functional currency of the entity concerned are recorded at the rates ruling
when the transactions occur. Exchange differences arising from the settlement
of monetary items are included in the statement of comprehensive income for
that period.
1.14 Leases
The Group is party as lessee only to low value or short-term leases. Rentals
payable under such leases, net of lease incentives, are charged to the
statement of comprehensive income on a straight-line basis over the period of
the lease.
1.15 Financial assets at amortised cost
These assets are non-derivative financial assets which are held in a business
model whose objective is to collect contractual cashflows and whose
contractual terms give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal outstanding. They arise
principally through types of contractual monetary asset such as receivables.
They are initially recognised at fair value plus transaction costs that are
directly attributable to their acquisition or issue and are subsequently
carried at amortised cost using the effective interest rate method, less
provision for impairment. Impairment provisions are recognised based on
expected credit losses over the asset's life.
The Group's assets held at amortised cost comprise trade and other receivables
and cash and cash equivalents in the consolidated statement of financial
position.
Fair value measurement
IFRS 13 establishes a single source of guidance for all fair value
measurements. IFRS 13 does not change when an entity is required to use fair
value, but rather provides guidance on how to measure fair value under IFRS
when fair value is required or permitted. The resulting calculations under
IFRS 13 affected the principles that the Company uses to assess the fair
value, but the assessment of fair value under IFRS 13 has not materially
changed the fair values recognised or disclosed. IFRS 13 mainly impacts the
disclosures of the Company. It requires specific disclosures about fair value
measurements and disclosures of fair values, some of which replace existing
disclosure requirements in other standards.
1.16 Financial Instruments
Financial investments
Non-derivative financial assets comprising the Company's strategic financial
investments in entities not qualifying as subsidiaries, associates or jointly
controlled entities. These assets are classified as investments at fair
value through profit or loss. They are carried at fair value with changes in
fair value recognised through the income statement. Where there is a
significant or prolonged decline in the fair value of a financial investment
(which constitutes objective evidence of impairment), the full amount of the
impairment is recognised in the income statement.
Due to the nature of these assets being unlisted investments or held for the
longer term, the investment period is likely to be greater than 12 months and
therefore these financial assets are shown as non-current assets in the
Statement of financial position.
Trade and other receivables
Trade receivables are measured at initial recognition at fair value and are
subsequently measured at amortised cost using the effective interest rate
method. Trade and other receivables are accounted for at original invoice
amount less any provisions for doubtful debts. Provisions are made where
there is evidence of a risk of non-payment, taking into account the age of the
debt, historical experience and general economic conditions. If a trade debt
is determined to be uncollectable, it is written off, firstly against any
provisions already held and then to the statement of comprehensive income.
Subsequent recoveries of amounts previously provided for are credited to the
statement of comprehensive income.
Appropriate allowances for estimated irrecoverable amounts are recognised in
profit or loss in accordance with the expected credit loss model under IFRS 9.
For trade and other receivables which do not contain a significant financing
component, the Company applies the simplified approach. This approach requires
the allowance for expected credit losses to be recognised at an amount equal
to lifetime expected credit losses. For other debt financial assets the
Company applies the general approach to providing for expected credit losses
as prescribed by IFRS 9, which permits for the recognition of an allowance for
the estimated expected loss resulting from default in the subsequent 12-month
period. Exposure to credit loss is monitored on a continual basis and, where
material, the allowance for expected credit losses is adjusted to reflect the
risk of default during the lifetime of the financial asset should a
significant change in credit risk be identified.
The majority of the Company's financial assets are expected to have a low risk
of default. A review of the historical occurrence of credit losses indicates
that credit losses are insignificant due to the size of the Company's clients
and the nature of its activities. The outlook for the natural resources
industry is not expected to result in a significant change in the Company's
exposure to credit losses. As lifetime expected credit losses are not expected
to be significant, the Company has opted not to adopt the practical expedient
available under IFRS 9 to utilise a provision matrix for the recognition of
lifetime expected credit losses on trade receivables. Allowances are
calculated on a case-by-case basis based on the credit risk applicable to
individual counterparties.
Fair Value Measurement
Fair value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market participants at
the measurement date. Fair value measurement is based on the presumption that
the transaction to sell the asset or transfer the liability takes place
either:
· In the principal market for the asset or liability; or
· In the absence of a principal market, in the most advantageous
market for the asset or liability principal or the most advantageous market
accessible by the Group.
The fair value of an asset or a liability is measured using the assumptions
that market participants would use when pricing the asset or liability,
assuming that market participants act in their economic best interest.
A fair value measurement of a non-financial asset takes into account a market
participant's ability to generate economic benefits by using the asset in its
highest and best use or by selling it to another market participant that would
use the asset in its highest and best use.
The Company uses valuation techniques that are appropriate in the
circumstances and for which sufficient data are available to measure fair
value, maximising the use of relevant observable inputs and minimising the use
of unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in
the financial statements are categorised within the fair value hierarchy,
described as follows, based on the lowest level input that is significant to
the fair value measurement as a whole:
· Level 1 - Quoted (unadjusted) market prices in active markets for
identical assets or liabilities
· Level 2 - Valuation techniques for which the lowest level input
that is significant to the fair value measurement is directly or indirectly
observable
· Level 3 - Valuation techniques for which the lowest level input
that is significant to the fair value measurement is unobservable
For assets and liabilities that are recognised in the financial statements on
a recurring basis, the Company determines whether transfers have occurred
between levels in the hierarchy by re-assessing categorisation (based on the
lowest level input that is significant to the fair value measurement as a
whole) at the end of each reporting period.
For the purpose of fair value disclosures, the Company has determined classes
of assets and liabilities on the basis of the nature, characteristics and
risks of the asset or liability and the level of the fair value hierarchy, as
explained above.
1.17 Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at the bank and
other short-term liquid investments with original maturities of three months
or less.
1.18 Financial liabilities at amortised cost
Financial liabilities at amortised cost include debt instruments and the host
contract element of hybrid liabilities containing embedded derivatives. These
liabilities are measured initially at transaction price, less issue costs and
the separation of the fair value of embedded derivatives. They are
subsequently measured at amortised cost using the effective interest method.
1.19 Derivative liabilities
Embedded derivatives are separated from the host contract at their estimated
fair value at the date of the transaction. They are subsequently measured at
fair value through profit and loss. Values attributed to the unexpired option
period at the date of exercise of an option are credited to equity.
1.20 Trade payables
Trade payables are recognised at amortised cost. All of the trade payables are
non-interest bearing.
1.21 Share capital
Ordinary shares are classified as equity. Shares issued in the period are
recognised at the fair value of the consideration received.
1.22 Warrants
Warrants issued as part of financing transactions in which the holder receives
a fixed number of shares on exercise of the warrant are fair valued at the
date of grant and recorded within the warrant reserve. Fair value is measured
by the use of the Black-Scholes model.
On expiry or exercise, the fair value of warrants is credited to reserves as a
change in equity.
1.23 Share-based payments
Equity-settled share-based payments to directors are measured at the fair
value of the equity instruments at the grant date. Details regarding the
determination of the fair value of equity-settled share-based transactions is
set out in Note 19.
The fair value determined at the grant date is expensed on a straight-line
basis over the vesting period or periods, based on the Group's estimate of
equity instruments that will eventually vest. At each balance sheet date, the
Group revises its estimate of the number of equity instruments expected to
vest. The impact of the revision of the original estimates, if any, is
recognised in profit or loss such that the cumulative expenses reflects the
revised estimate, with a corresponding adjustment to equity reserves.
In respect of equity-settled arrangements within the scope of IFRS 2
representing contingent consideration for the acquisition of assets, the value
of the equity instruments is presumed to be equivalent to the fair value of
the assets acquired. In the case of assets acquired on the acquisition of
Greenfield, cost is deemed to be the best estimate of fair value.
2. Segmental reporting - Analysis by geographical segment
The loss before taxation arises within principally the UK and US. Net assets
are principally in the UK and US. Based on an analysis of risks and returns,
the Directors consider that the Group has two principal business segments
based on geography, with the UK primarily representing head office costs of
the Group. Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker. The chief
operating decision maker has been identified as the Board of Directors. The
Directors therefore consider that no further segmentation is appropriate.
United States United Kingdom Eliminations Total United States United Kingdom Eliminations Total
Year ended 30 September 2024 2024 2024 2024 2023 2023 2023 2023
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
External revenue - - - - - 109 - 109
Inter-segment sales - - - - - - - -
Cost of sales - - - - - - - -
Gross profit/(loss) - - - - - 109 - 109
Administrative expenses (82) (772) - (854) (151) (930) - (1,081)
Impairment losses (4,269) - - (4,269) - - - -
Foreign exchange losses (803) (14) - (817) (589) (21) - (610)
Operating profit/(loss) (5,154) (786) - (5,940) (740) (842) - (1,582)
Finance (costs)/income (59) - - (59) (91) (673) - (764)
Loss on disposal of investment (336) - - (336) - - -
Loss/(profit) before taxation (5,549) (786) - (6,335) (831) (1,515) - (2,346)
Non-Current assets:
- Exploration and development assets - - - - 4,703 - - 4,703
- Other 65 - - 65 40 - - 40
- Investments at FVTPL - - - - 1,637 - - 1,637
65 - - 65 6,380 - - 6,380
Current assets:
Trade and other receivables - 40 - 40 2 32 - 34
Other financial assets - - - - - - - -
Cash and cash equivalents - 857 - 857 - 62 - 62
Total assets 65 897 - 962 6,382 94 - 6,476
Current liabilities:
Trade and other payables - (147) - (147) - (123) - (123)
Financial liabilities (462) - (462) (445) - (445)
Total liabilities (462) (147) - (609) (445) (123) - (568)
3. Finance costs
2024 2023
£'000 £'000
Interest payable 59 837
Change in fair value of derivatives - (71)
Interest income - (2)
Total finance costs for the financial year 59 764
4. Operating loss
The following items have been charged/(credited) in arriving at operating 2024 2023
loss:
£'000 £'000
Auditors' remuneration: audit services 41 41
Rentals payable in respect of land and buildings 16 -
5. Taxation
There is no tax charge in the year due to the loss incurred for the year.
Factors affecting the tax charge: 2024 2023
£'000 £'000
Loss on ordinary activities before tax (6,335) (2,346)
Loss on ordinary activities at standard rate of corporation tax - -
in the Isle of Man of nil% (2023: nil%)
Tax charge for the financial year - -
No charge to taxation arises due to the losses incurred. TomCo is not subject
to tax in the Isle of Man but is subject to tax in relation to its
subsidiaries operating in the USA, however, the Group is loss making and has
no taxable profits to date. No deferred tax asset has been recognised on
accumulated tax losses because of the uncertainty over the timing of future
taxable profits against which the losses may be offset.
Disclosure concerning deferred tax is given in note 15.
6. Employees and Directors
The Group has one employee (2023: one) other than the Directors, whose
emoluments comprise fees paid for services. The amounts for their services are
detailed below and also in the remuneration committee report in more detail.
The Directors are the key management personnel.
Salaries (incl. bonuses)
Salaries
2024 2023
£'000 £'000
J. Potter (passed away on 24 May 2024) 131 253
M. Groat 64 50
L. Castro 56 42
Z. Phillips 50 36
Total remuneration 301 381
7. Loss per share
Basic loss per share is calculated by dividing the losses attributable to
ordinary shareholders by the weighted average number of ordinary shares
outstanding during the year. Reconciliations of the losses and weighted
average number of shares used in the calculations are set out below.
Losses Weighted average number of shares Per share Amount
Financial year ended 30 September 2024 £'000 Pe
nc
e
Basic and Diluted EPS
Losses attributable to ordinary shareholders on continuing operations (6,335) 3,626,038,747 (0.17)
Total losses attributable to ordinary shareholders (6,335) 3,626,038,747 (0.17)
Financial year ended 30 September 2023
Basic and Diluted EPS
Losses attributable to ordinary shareholders on continuing operations (2,346) 2,444,431,749 (0.10)
Total losses attributable to ordinary shareholders (2,346) 2,444,431,749 (0.10)
The warrants, share options and conversion options which were issued or for
which entitlement was established in the current and prior years (Notes 18 and
19) are anti-dilutive. As these instruments would be anti-dilutive a separate
diluted loss per share is not presented.
8. Intangible assets
Oil & Gas Oil & Gas Oil & Gas Oil & Gas
Exploration and evaluation expenditure Development expenditure Patents and patent applications Total
£'000 £'000 £'000 £'000
Cost
At 1 October 2022 8,526 6,108 30 14,664
Additions 7 196 - 203
Translation differences (26) (507) - (533)
At 30 September 2023 8,507 5,797 30 14,334
Disposals (30) - - (30)
Translation differences (8) (396) - (404)
At 30 September 2024 8,469 5,401 30 13,900
Amortisation/Impairment
At 1 October 2022 (8,287) (1,314) (30) (9,631)
Amortisation - - - -
Impairment - - - -
At 30 September 2023 (8,287) (1,314) (30) (9,631)
Impairment (182) (4,087) - (4,269)
At 30 September 2024 (8,469) (5,401) (30) (13,900)
Net book value
At 30 September 2024 - - - -
At 30 September 2023 220 4,483 - 4,703
The assets acquired with Greenfield are described at note 1.10. The
exploration and development licences comprise nine Utah oil shale leases
covering approximately 15,488 acres. These assets were impaired in full as at
30 September 2021 and remain so.
9. Property, plant and equipment
Exploration and evaluation equipment
£'000
Cost at 1 October 2022 386
Translation differences -
At 30 September 2023 386
Translation differences -
At 30 September 2024 386
Impairment at 1 October 2022 386
Charge for year -
At 30 September 2023 and 2024 386
Net book value
At 30 September 2024 -
At 30 September 2023 -
These assets were impaired in full as at 30 September 2021 and remain so for
the reasons given in note 1.11.
10. Investments at FVTPL
The fair value hierarchy of financial instruments measured at fair value is
provided below
Financial assets at fair value through profit or loss £'000 £'000
Level 3 Total
Cost at 30 September 2023 1,637 1,637
Foreign Exchange (56) (56)
Disposal (1,581) (1,581)
-
Cost at 30 September 2024 -
The financial assets splits are as below:
Non-current assets - listed -
Non-current assets - unlisted -
Total -
The Group purchased a 10% membership interest in Tar Sands Holdings II LLC
("TSHII") and held an option to purchase the remaining 90% for additional cash
consideration of $17.25 million by an extended deadline of 31 December 2023.
This asset was redeemed for £1.245 million during the year generating a loss
on sale of £336,000.
11. Trade and other receivables
Group Group
2024 2023
Current £'000 £'000
Other receivables 17 11
Prepayments and accrued income 23 23
40 34
Non-current
Other receivables 65 40
Total Receivables 105 74
As at 30 September 2024, there were no receivables considered past due (2023:
£Nil). The maximum exposure to credit risk at the reporting date is the fair
value of each class of receivable and cash and cash equivalents as disclosed
in Note 14.
All current receivable amounts are due within six months.
12. Cash and cash equivalents
Group Group
2024 2023
£'000 £'000
Cash at bank and in hand 857 62
The Group earns 0.05% (2023: 0.05%) interest on its cash deposits,
consequently the Group's exposure to interest rate volatility is not
considered material.
13. Loans
Group Group
2024 2023
Current £'000 £'000
Term loan 462 445
462 445
This loan comprises the loan received from Valkor, further details of which
are set out in the Going Concern note and also in the Directors' Report.
14. Trade and other payables
Group Group
2024 2023
Current £'000 £'000
Trade payables 5 40
Other payables 6 16
Accruals 136 67
147 123
All current amounts are payable within six months and the Directors consider
that the carrying values adequately represent the fair value of all payables.
15. Deferred tax
Unrecognised losses
The Group has tax losses in respect of excess management expenses of
approximately £16 million (2023: £15 million) available for offset against
future Company income. This gives rise to a potential deferred tax asset at
the reporting date of £4 million (2023: £3.75 million). No deferred tax
asset has been recognised in respect of the tax losses carried forward as the
recoverability of this benefit is dependent on the future profitability of the
Company, the timing of which cannot reasonably be foreseen but the excess
management expenses have no expiry date. In addition, subsidiary entities have
accumulated losses of approximately £13.5 million for which no deferred tax
asset is recorded given the uncertainty of future profits.
16. Share capital
Number of shares 2024
in issue £
Issued and fully paid at 1 October 2022 - shares of no par value 1,748,078,678 -
October 2022-July 2023 conversion of convertible loans 425,044,218 -
November 2022-placing (note 17) 264,285,714 -
June 2023-placing and subscription 625,000,000 -
At 30 September 2023 3,062,408,610 -
October 2023-subscription at £0.0008 per share (note 17) 125,000,000 -
January 2024-subscription at £0.001 per share (note 17) 50,000,000 -
February 2024-placing and subscription at £0.00045 per share (note 17) 666,666,667 -
March 2024-additional conversion shares 60,000 -
At 30 September 2024 3,904,135,277 -
All shares issued were issued to provide working capital for
the Group.
17. Share premium
2024 2023
£'000 £'000
At 1 October 34,886 32,527
Conversion of convertible loans and associated interest - 1,050
Placing and subscriptions-net of costs* (note 16) 432 1,309
Additional conversion shares - -
At 30 September 35,318 34,886
*The placing and subscriptions raised aggregate gross proceeds
of £450,000 with associated costs of £18,000.
18. Warrants
At 30 September 2024, the following share warrants were outstanding in respect
of ordinary shares:
2024 2024 2023 2023
number Weighted average exercise price number Weighted average exercise price
Pence Pence
Outstanding at 1 October 244,190,463 0.58 452,427,350 0.88
Expired during the year (55,000,000) (0.75) (397,427,350) (0.89)
Granted during the year 26,666,667 0.05 189,190,463 0.54
Exercised during the year - - - -
Outstanding at 30 September 215,857,130 0.48 244,190,463 0.58
Exercisable at 30 September 215,857,130 0.48 244,190,463 0.58
The inputs into the Black-Scholes model for calculating the estimated fair
value of warrants granted, at their grant date, were as follows:
2023
2024
Share price (pence) 0.05 0.08-0.385
Exercise price (pence) 0.045 0.08-0.75
Expected volatility 138% 96%-111%
Risk-free rate 4.49% 3.5%-3.9%
Expected period before exercise (years) 2 2
Expected volatility was determined by calculating the historical volatility of
the Company's share price. The expected life used in the model has been
adjusted, based on management's best estimate, for the effects of
non-transferability, exercise restrictions and behavioural considerations.
Issue of Warrants
143,333,320 warrants were issued in the year ended 30 September 2023 at
exercise prices of between 0.6p and 0.75p in connection with the issue of
convertible loans. In addition, 45,857,143 warrants were issued at exercise
prices of between 0.08p and 0.35p in connection with placings.
26,666,667 warrants were issued in the year ended 30 September 2024 at an
exercise price of 0.045p in connection with a placing, but are deemed to have
a fair value of zero.
Each warrant in issue is governed by the provisions of warrant instruments
representing the warrants which have been adopted by the Company. The rights
conferred by the warrants are transferable in whole or in part subject to and
in accordance with the transfer provisions set out in the Company's Articles.
The warrants outstanding at 30 September 2024 had a weighted average exercise
price of 0.48p (2023: 0.58p) and a weighted average remaining contractual life
of 1.46 years (2023: 1.66 years). There was no charge in the income statement
for the warrants issued in the year since, as set out above, these warrants
are valueless.
19. Share-based payments
The Company implemented a share option scheme for its Directors during the
year ended 30 September 2018. Further issues of options took place in June
2020 and June 2021. Options are exercisable at a price equal to the quoted
market price of the Company's shares at the date of grant. The vesting period
is between six months and 1 year. If the options remain unexercised after a
period of ten years from the date of grant (5 years in the case of options
granted in June 2020) the options expire. Options are forfeited if the
director leaves the Company before the options vest.
Details of the share options outstanding at the year-end are as follows:
2024 2024 2023 2023
number Weighted average number Weighted average
exercise price exercise price
Pence Pence
Outstanding as at 1 October 98,365,078 0.70 98,365,078 0.70
Outstanding at 30 September 98,365,078 0.70 98,365,078 0.70
Exercisable at 30 September 98,365,078 98,365,078
Details of the options held by each Director are provided in the Directors'
Report.
No new options were granted in the year ended 30 September 2024 (2023: nil).
The weighted average unexpired life of the options at 30 September 2024 was
3.08 years (2023: 6.9 years).
During the year, John Potter sadly passed away. The share options held by John
remain technically exercisable but are out of the money at the reporting date.
The Board has decided that the options will be allowed to lapse naturally
under the terms of the scheme. These options, totalling 52,714,285, are
included in the number of options exercisable at the year end.
The charge recognised in profit or loss for 2024 was £nil (2023: £nil).
Where equity instruments to be issued as consideration for the purchase of a
group of assets that does not constitute a business are within the scope of
IFRS 2, the value of the equity instruments is determined by reference to the
fair value of the net assets acquired. This is deemed to be cost at the date
of acquisition.
20. Financial instruments
The Group's financial instruments, other than its investments, comprise cash
and items arising directly from its operations such as other receivables, and
trade payables.
Management reviews the Group's exposure to currency risk, interest rate risk,
liquidity risk and credit risk on a regular basis and considers that through
this review they manage the exposure of the Group. No formal policies have
been put in place in order to hedge the Group's activities to the exposure to
currency risk or interest risk, however, this is constantly under review.
There is no material difference between the book value and fair value of the
Group and Company's cash and other financial assets.
Currency risk
The Group has overseas subsidiaries which operate in the United States and
include expenses, assets and liabilities denominated in US$. Foreign exchange
risk is inherent in the Group's activities and is accepted as such. The effect
of a 10% strengthening or weakening of the US dollar against sterling at the
reporting date would, all other variables held constant, result in a gain or
loss reported in profit and loss of approximately £610,000 (2023: £650,000).
Interest rate risk
The Group and Company manage the interest rate risk associated with the
Group's cash assets by ensuring that interest rates are as favourable as
possible, whether this is through investment in floating or fixed interest
rate deposits, whilst managing the access the Group requires to the funds for
working capital purposes.
The Group's cash and cash equivalents are subject to interest rate exposure
due to changes in interest rates. Short-term receivables and payables are not
exposed to interest rate risk. The Group borrows at fixed interest rates and
therefore there is no effect on profit and loss attributable to changes in
interest rates.
A 1% increase or decrease in the floating rate attributable to the cash
balances held at the year-end would not result in a significant difference in
interest receivable.
Liquidity risk
At the year end the Group and Company had cash balances comprising the
following:
Group Group
2024 2023
Bank balances £'000 £'000
British Pounds 93 37
US Dollars 764 25
Total 857 62
All financial liabilities of the Group mature in less than 12 months: details
of the analysis of such liabilities is provided in Notes 13 and 14.
Liquidity risk arises from the Group's management of working capital. It is
the risk that the Group will encounter difficulty in meeting its financial
obligations as they fall due. Refer to Note 1.1 for details of going concern.
The Group's policy is to ensure that it will always have sufficient cash to
allow it to meet its liabilities when they become due. To achieve this aim, it
seeks to maintain cash balances (or agreed facilities) to meet expected
requirements for a period of at least 90 days.
Credit Risk
Credit risk is the risk of financial loss to the Group if a customer or a
counter party to a financial instrument fails to meet its contractual
obligations. The Group is principally exposed to credit risk on cash and cash
equivalents with banks and financial institutions. For banks and financial
institutions, only independently rated parties with an acceptable credit
rating are utilised. There has been no significant change in credit risk since
the recognition of applicable assets and therefore no credit losses have been
recognised on financial assets.
Capital management policies
In managing its capital, which include it equity, cash and debt, the Group's
primary objective is to maintain a sufficient funding base to enable the Group
to meet its working capital and strategic investment needs. In making
decisions to adjust its capital structure to achieve these aims, through new
share issues or debt, the Group considers not only its short-term position but
also its long-term operational and strategic objectives.
21. Changes in liabilities arising from financing activities
The table below details changes in the Group's liabilities arising from
financing activities, including both cash and non-cash changes. Liabilities
arising from financing activities are those for which cash flows were, or
future cash flows will be, classified in the cash flow statement as cash flows
from financing activities:
1 October Financing cash flows Non-cash transactions 30 September
Group 2024 £'000 £'000 £'000 £'000
445 - 462
Loans 17
Total 445 - 17 462
Group 2023
1,292 (20) 445
Loans (827)
Total 1,292 (20) (827) 445
22. Related party disclosures
The Directors are Key Management and information in respect of Key Management
is provided in Note 6.
The Company was charged £6,993 (2023: £19,429) for professional services
rendered by Oil & Gas Advisors Ltd
of which a director is the controlling shareholder. £669 (2023: £733) was
owed to this entity at 30 September 2024.
23. Subsidiary undertakings
The subsidiary undertakings of TomCo Energy plc at 30 September 2024 and 2023
were as follows:
Country of incorporation
Greenfield Energy LLC USA
AC Oil LLC USA
TurboShale Inc (dormant) USA
The Oil Mining Company Inc (dormant) USA
All entities are wholly-owned. Ownership of AC Oil LLC is via Greenfield
Energy LLC.
24. Ultimate controlling party
As at 30 September 2024 and 30 September 2023 there was no ultimate
controlling party.
25. Operating lease commitments
At 30 September 2024, the Group had no operating lease commitments (2023:
£nil).
26. Subsequent events
In late November 2024, a wholly owned subsidiary, AC Oil LLC ("AC Oil"), was
party to an application made to the Utah Division of Oil, Gas and Mining for
permitting to drill six holes on its lease area near Vernal, Utah.
- ENDS -
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