REG - TomCo Energy PLC - Interim Results & Lifting of Suspension in Trading
18/09/2024 12:30
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RNS Number : 7145E TomCo Energy PLC 18 September 2024
18 September 2024
TomCo Energy plc
("TomCo", the "Company" or, with its subsidiaries, the "Group")
Unaudited interim results for the six-month period ended 31 March 2024
and Lifting of Suspension in Trading
TomCo Energy plc (AIM: TOM), the US operating oil development group focused on
using innovative technology to unlock unconventional hydrocarbon resources,
announces its unaudited interim results for the six-month period ended 31
March 2024.
As a result of the publication of these results, which are available on the
Company's website at www.tomcoenergy.com (http://www.tomcoenergy.com) ,
trading in the Company's ordinary shares on AIM will be restored with effect
from 12.30 p.m. today.
Chairman's Statement
The whole Company and its advisers were most saddened by the loss of our
longstanding Chief Executive, John Potter, who passed away suddenly on 24 May
2024. John established an exciting opportunity for TomCo in recent years, by
way of laying the groundwork for a potential tar sands development project in
Utah, USA. He earnt the admiration of many friends along the way, amongst whom
I am proud to include myself.
Following John's sudden and untimely passing, I have subsequently assumed the
role of Executive Chairman on an interim basis in order to determine with my
fellow Directors the best way forward for the Company to seek to unlock its
significant potential. Understandably, a number of shareholders have contacted
me, following John's passing, to enquire about the impact on the Company and
its future direction. The Company's primary focus during the reporting
period was on its wholly owned subsidiary, Greenfield Energy, LLC
("Greenfield"), and seeking to secure sufficient financing to progress its
plans to, inter alia, purchase the balancing 90% membership interest in Tar
Sands Holdings II, LLC ("TSHII") that it did not already own and pursue the
construction of up to two tar sands separation/processing plants capable of
processing at least 6,000 tonnes per day of tar sands at a suitable permitted
site in the Unita Basin, Utah, USA.
However, Greenfield's exclusive right to exercise its option over the
balancing 90% stake in TSHII expired at the end of 2023 and, having
subsequently been approached in early August 2024 by the 90% stakeholder,
Endeavor Capital Group, LLC ("Endeavour Capital") and in need of further
interim funding, we agreed to redeem Greenfield's 10% minority stake in TSHII
in return for aggregate cash consideration of US$1,575,000. Such redemption
was subject to shareholder approval pursuant to AIM Rule 15 which was obtained
at a duly convened general meeting held on 9 September 2024.
As part of the transaction documentation, 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"). The 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. 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 (the "Additional Lease") which could potentially be a source of
tar sands to feed the future proposed separation/processing plants.
Accordingly, once the Additional Lease is secured, Greenfield should be able
to continue to pursue its existing tar sands development project subject to
securing the requisite additional funding and permitting going forwards.
Alongside the tar sands development project, and subject to raising the
requisite additional funding in due course, the Company also intends to pursue
the potential drilling of production wells in in situ oil sands on the Lease
Area as a means of generating revenue and cashflow for the Group, as it
currently has no producing or revenue generating assets
The net proceeds from the redemption of the Group's 10% stake in TSHII will
primarily be used for the Company's general working capital requirements, to
potentially progress the in situ production well programme and to facilitate
the identification and evaluation of potential new project opportunities to
expand the Company's asset portfolio.
In summary, we remain hopeful of making progress and reducing the level of
uncertainty in the short term as we continue work on a number of fronts and
thank all of the Group's various stakeholders for their continuing patience
and support through these difficult times. We are also most appreciative of
the many kind comments and condolences received in respect of John. He was a
very good man, a much-loved husband and father, and a first-class colleague
who is sorely missed.
Malcolm Groat
Interim Executive Chairman
18 September 2024
Enquiries:
TomCo Energy plc
Malcolm Groat (Interim Executive
Chairman) +44 (0)20 3823
3635
Strand Hanson Limited (Nominated Adviser)
James Harris / Matthew Chandler
+44 (0)20 7409 3494
Novum Securities Limited (Broker)
Jon Belliss / Colin Rowbury
+44 (0)20 7399 9402
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.
Condensed consolidated statement of comprehensive income
For the six-month period ended 31 March 2024
Unaudited Unaudited
Six months ended Six months ended Audited
31 March 31 March Year ended
30 September
2024 2023 2023
Note £'000 £'000 £'000
Other income - 86 109
Cost of sales - - -
Gross profit - 86 109
Administrative expenses 3 (416) (555) (1,081)
Foreign exchange losses (208) (699) (610)
Operating loss (624) (1,168) (1,582)
Finance costs (30) (277) (764)
Loss on ordinary activities before taxation (654) (1,445) (2,346)
Taxation - - -
Loss from continuing operations (654) (1,445) (2,346)
Loss for the period/year attributable to:
Equity shareholders of the parent (654) (1,445) (2,346)
(654) (1,445) (2,346)
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations
Other comprehensive income for the year attributable to:
Equity shareholders of the parent 21 3 (26)
Other comprehensive income (26)
21 3
Total comprehensive loss attributable to:
Equity shareholders of the parent (633) (1,442) (2,372)
(633) (1,442) (2,372)
Loss per share attributable to the equity shareholders of the parent
Basic & Diluted Loss per share (pence) 4 (0.02) (0.07) (0.10)
Condensed consolidated statement of financial position
As at 31 March 2024
Unaudited Unaudited Audited
Six months Six months Year ended
ended ended 30 September
31 March 31 March
2024 2023 2023
Note £'000 £'000 £'000
Assets
Non-current assets
Intangible assets 5 4,525 4,594 4,703
Property, plant and equipment - - -
Investments at FVTPL 6 1,585 1,619 1,637
Other receivables 69 39 40
6,179 6,252 6,380
Current assets
Trade and other receivables 41 116 34
Cash and cash equivalents 90 132 62
131 248 96
Total Assets 6,310 6,500 6,476
Liabilities
Current liabilities
Loans (460) (607) (445)
Trade and other payables (143) (130) (123)
(603) (737) (568)
Net current liabilities (473) (489) (472)
Total liabilities (603) (737) (568)
Total Net Assets 5,707 5,763 5,908
Shareholders' equity
Share capital - - -
Share premium 35,318 34,148 34,886
Warrant reserve 8 390 338 390
Translation reserve (204) (196) (225)
Retained deficit (29,797) (28,527) (29,143)
Equity attributable to owners of the parent 5,707 5,763 5,908
Total Equity 5,707 5,763 5,908
The above financial information was approved and authorised for issue by the
Board of Directors on 18 September 2024 and was signed on its behalf by:
M
Groat
Director
Condensed consolidated statement of changes in equity
For the six-month period ended 31 March 2024
Note Share Share Warrant Translation Retained Total
capital premium reserve reserve deficit
£'000 £'000 £'000 £'000 £'000 £'000
At 30 September 2022 (audited) - 32,527 1,374 (199) (28,290) 5,412
Loss for the period - - - - (1,445) (1,445)
Comprehensive income for the period - - - 3 - 3
Total comprehensive loss for the period - - - 3 (1,445) (1,442)
Issue of shares (net of costs) - 1,621 32 - - 1,653
Issue of finance - - 140 - - 140
Expiry of warrants - - (1,208) 1,208 -
At 31 March 2023 (unaudited) - 34,148 338 (196) (28,527) 5,763
Loss for the period - - - - (901) (901)
Comprehensive income for the period - - - (29) - (29)
Total comprehensive income for the period - - - (29) (901) (930)
Issue of shares (net of costs) - 738 - - - 738
Issue of finance - - 53 - - 53
Expiry of warrants - - (1) - 1 -
Expiry of conversion option - 284 284
- - -
At 30 September 2023 (audited) - 34,886 390 (225) (29,143) 5,908
Loss for the period - - - - (654) (654)
Comprehensive income for the period - - - 21 - 21
Total comprehensive loss for the period - - - 21 (654) (633)
Issue of shares (net of costs) - 432 - - - 432
At 31 March 2024 (unaudited) - 35,318 390 (204) (29,797) 5,707
The following describes the nature and purpose of each reserve within owners'
equity:
Reserve Description 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 Company.
Translation reserve Amounts debited or credited to equity arising from translating the results of
subsidiary entities whose functional currency is not sterling.
Retained deficit Cumulative net gains and losses recognised in the consolidated statement of
comprehensive income.
Condensed consolidated statement of cash flows
For the six-month period ended 31 March 2024
Unaudited Unaudited Audited
Six months ended 31 March 2024 Six months ended 31 March 2023 Year ended
30 September
2023
Note £'000 £'000 £'000
Cash flows from operating activities
Loss after tax (654) (1,445) (2,346)
Finance costs 30 276 764
Unrealised foreign exchange losses 219 700 581
(Increase)/decrease in trade and other receivables (20) (9) 46
Increase/(decrease) in trade and other payables 21 (213) (221)
Cash used in operations (404) (691) (1,176)
Interest received/(paid) - (54) (87)
Net cash outflows from operating activities (404) (745) (1,263)
Cash flows from investing activities
Investment in intangibles 5 - (146) (202)
Net cash used in investing activities - (146) (202)
Cash flows from financing activities
Issue of share capital 450 925 1,425
Costs of share issue (18) (61) (84)
Loan finance - (422) (580)
Convertible loans - 375 625
Costs of convertible loans - - (65)
Net cash generated from financing activities 432 817 1,321
Net (decrease)/increase in cash and cash equivalents 28 (74) (144)
Cash and cash equivalents at beginning of financial period 62 206 206
Foreign currency translation differences - - -
Cash and cash equivalents at end of financial period 90 132 62
Unaudited notes forming part of the unaudited condensed consolidated interim
financial statements
For the six-month period ended 31 March 2024
1. Accounting Policies
Basis of Preparation
The unaudited condensed consolidated interim financial statements of TomCo
Energy plc ("TomCo" or the "Company") for the six months ended 31 March 2024,
comprise the Company and its subsidiaries (together referred to as the
"Group").
The unaudited condensed consolidated interim financial information for the
Group has been prepared using the recognition and measurement requirements of
International Financial Reporting Standards (IFRS and IFRIC interpretations)
issued by the International Accounting Standards Board ("IASB") as adopted for
use in the EU, with the exception of IAS 34 Interim Financial Reporting that
is not mandatory for companies quoted on the AIM market of the London Stock
Exchange. The unaudited condensed consolidated interim financial information
has been prepared using the accounting policies which will be applied in the
Group's statutory financial information for the year ending 30 September 2024.
There were no new standards, interpretations and amendments to published
standards effective in the period which had a significant impact on the Group.
Going concern
As at the end of July 2024, the Group only had cash reserves of
approximately £5k, and an outstanding loan due to Valkor Oil & Gas
LLC of approximately £0.47 million (approximately US$0.6 million)
although such 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.
As announced on 14 August 2024, and as subsequently approved by the Company's
shareholders at a duly convened general meeting held on 9 September 2024, the
Company has recently completed the redemption of Greenfield's 10% membership
interest in TSHII in return for aggregate consideration of US$1.575 million
(approximately £1.234 million) before expenses. Pursuant to the Group's cash
flow forecasts for the period to 30 September 2025, the net proceeds of the
redemption, following settlement of the Group's pre-existing trade creditors
and deferred Directors' salaries, are currently expected to provide sufficient
working capital for the Group to remain as a going concern for at least twelve
months from the date of publication of these interim results, based on the
Board's currently anticipated and forecast outgoings.
2. Financial reporting period
The unaudited condensed consolidated interim financial information
incorporates comparative figures for the unaudited six-month interim period to
31 March 2023 and the audited financial year ended 30 September 2023. The
six-month financial information to 31 March 2024 is neither audited nor
reviewed. The Directors consider the unaudited condensed consolidated
interim financial information for the period to be a fair representation of
the financial position, results from operations and cash flows for the period
in conformity with generally accepted accounting principles consistently
applied.
The financial information contained in these unaudited condensed consolidated
interim financial statements does not constitute statutory accounts as defined
by the Isle of Man Companies Act 2006. It does not include all disclosures
that would otherwise be required in a complete set of financial statements and
should be read in conjunction with the 2023 Annual Report and Financial
Statements. The comparatives for the full year ended 30 September 2023 are not
the Group's full statutory accounts for that year. The auditors' report on
those accounts contained an emphasis of matter regarding a material
uncertainty related to going concern.
3. Operating Loss
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 March 31 March 30 September
2024 2023 2023
£'000 £'000 £'000
The following items have been charged in arriving at operating loss:
Directors' remuneration 185 232 381
Auditors' remuneration 26 21 41
4. 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 period concerned. 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
Six months ended 31 March 2024 £'000 Pence
Basic and Diluted EPS
Losses attributable to ordinary shareholders from continuing operations (654) 3,346,534,544 (0.02)
Losses Weighted average number of shares Per share amount
Six months ended 31 March 2023 £'000 Pence
Basic and Diluted EPS
Losses attributable to ordinary shareholders from continuing operations (1,445) 2,140,894,581 (0.07)
Losses Weighted average number of shares Per share amount
Year ended 30 September 2023 £'000 Pence
Basic and Diluted EPS
Losses attributable to ordinary shareholders from continuing operations (2,346) 2,444,431,749 (0.10)
5. Intangible assets
Oil & Gas Exploration and evaluation expenditure Oil & Gas Patents and patent applications Oil &Gas Development expenditure Total
£'000 £'000 £'000 £'000
Cost, net of impairment and amortisation
At 30 September 2022 (audited) 239 - 4,794 5,033
Additions 7 - 139 146
Translation differences and amortisation (28) - (557) (585)
At 31 March 2023 (unaudited) 218 - 4,376 4,594
Additions - - 57 57
Translation differences and amortisation 2 - 50 52
At 30 September 2023 (audited) 220 - 4,483 4,703
Additions - - - -
Transfer to current assets (31) - - (31)
Translation differences and amortisation (7) - (140) (147)
At 31 March 2024 (unaudited) 182 - 4,343 4,525
Net book value
At 31 March 2024 (unaudited) 182 - 4,343 4,525
At 30 September 2023 (audited) 220 - 4,483 4,703
At 31 March 2023 (unaudited) 218 - 4,376 4,594
A wholly owned subsidiary of Greenfield, AC Oil, LLC, entered into a 10-year
lease from 15 November 2021 to explore for oil, gas, hydrocarbons and all
associated substances over a 320-acre site in Uintah, Utah, USA owned by Tar
Sands Holdings II, LLC.
6. Investment at FVTPL
£'000
At 31 March 2023 1,619
Other comprehensive income - translation differences 18
At 30 September 2023 (audited) 1,637
Other comprehensive income - translation differences (52)
At 31 March 2024 1,585
In November 2021, Greenfield completed the purchase of a 10% membership
interest in Tar Sands Holdings II, LLC ("TSHII"). The investment is carried at
cost. The Group had an associated option to purchase the remaining 90%
interest in TSHII by 31 December 2023 for US$17.25 million, but this option
has now expired, such that the option is held at its cost of nil. On 9
September 2024, the Company's shareholders approved the redemption of
Greenfield's 10% membership interest in TSHII which was completed shortly
thereafter - refer to Note 9 below (post reporting date events) and the
Chairman's Statement for further details.
7. Share Capital
31 March 31 March 30 September
2024 2023 2023
Unaudited Unaudited Audited
Number of shares Number of shares Number of shares
Issued and fully paid
Number of ordinary shares of no par value 3,904,135,277 2,244,504,969 3,062,468,610
8. Warrants
31 March 31 March 30 September
2024 2023 2023
Unaudited Unaudited Audited
Outstanding (number) 270,857,130 162,523,803 244,190,463
Exercisable (number) 270,857,130 162,523,803 244,190,463
Weighted average exercise price (pence) 0.53 0.67 0.58
9. Post reporting date events
As announced on 14 August 2024, further to an approach from Endeavour Capital
and subsequent negotiation, on 12 August 2024 the Company entered into an
agreement (the "Side Agreement") with TSHII and Endeavour Capital whereby,
subject to shareholder approval pursuant to AIM Rule 15, the Company agreed to
redeem Greenfield's 10% minority stake in TSHII in return for aggregate cash
consideration of US$1,575,000 (approximately £1,234,000) (the "Redemption").
Endeavour had itself recently received a third-party approach from Integrated
Rail and Resources Acquisition Corp. (OTC: IRRX) ("IRRX"), a 'blank check'
company, expressing an interest in acquiring 100 per cent. of TSHII by way of
a corporate merger. Pursuant to the terms of the Side Agreement and subject
to TomCo's shareholders' consent, Greenfield (i) agreed to waive any rights it
may have had to prevent Endeavor Capital from selling its 90% membership
interest in TSHII to IRRX, and (ii) granted to TSHII the irrevocable,
unrestricted and unconditional right to redeem Greenfield's 10% membership
interest for the abovementioned cash consideration and the promise to
negotiate terms for the Additional Lease.
TSHII and IRRX also committed (a) not to terminate the existing Lease and (b)
to use best efforts to negotiate in good faith to enter into the Additional
Lease to provide mining rights for Greenfield on further acreage owned by
TSHII, save for that part occupied by an historic refinery and any land needed
for any extension of such refinery, which is currently intended to be
optimised and reactivated by IRRX (or such other entity established for such
purpose), on customary terms but specifically involving: rights and access to
mine tar sands, and a right to set up a potential processing plant(s) for tar
sands.
The requisite shareholder approval was obtained by the Company at a duly
convened general meeting held on 9 September 2024 and the transaction was
completed shortly thereafter. As the Redemption arose and was successfully
completed post the reporting period end, no adjustments have been made to
these unaudited condensed consolidated interim financial statements to reflect
the Redemption which will be dealt with and reflected in the Company's
forthcoming Annual Report and Financial Statements for the full financial year
ended 30 September 2024.
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