REG - Wentworth Resources - lnterim Results
01/09/2022 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220901:nRSA8428Xa&default-theme=true
RNS Number : 8428X Wentworth Resources PLC 01 September 2022
1 September 2022
WENTWORTH RESOURCES PLC
("Wentworth" or the "Company")
lnterim Results for the six months ended 30 June 2022
Wentworth achieves record financial results due to a continued increase in
demand in H1; declaring an interim dividend of $1.45m
Wentworth Resources (ΑΙΜ: WEN), the independent, Tanzania-focused natural
gas production company, announces its interim financial results for the six
months ended 30 June 2022. AII dollar values are expressed in US dollars
unless stated otherwise.
Katherine Roe, CEO, commented:
"We are pleased to have announced another strong set of results. A robust
balance sheet, record H1 production and a 10% increase in our interim dividend
demonstrates our focus on delivering responsible growth whilst simultaneously
increasing our considerable shareholder returns though our dividend policy and
buyback programme. We are upbeat about the outlook for the remainder of 2022
and beyond, as we look to create value for Tanzania, shareholders and our
wider stakeholders.
"We were delighted to be able to demonstrate our commitment to engaging with
our stakeholders in-country at the Tanzania Energy Congress in August, which
illustrated Tanzania's commitment to encouraging investment and growth in its
energy sector - synonymous with the Government's business-friendly approach.
"As we look to increase scale and drive growth, we will continue to consider
high quality opportunities on accretive terms, both within Tanzania and the
broader region. Whilst disappointed that the acquisition of an interest in
Ruvuma has been disrupted, having agreed terms that reflected the current risk
reward balance of the asset, we have demonstrated our ability to identify
value and negotiate favourable transactions in Tanzania."
HIGHLIGHTS
Dividend Declaration and Financial
· lnterim dividend of $1.45 million declared, an increase of 10% from
H1 2021 ($1.32 million) or 15% on a per share basis, bringing the total
distribution to shareholders to $7.9 million in the last 12 months
o dividend distribution of $5.5 million
o share buyback of $2.4 million representing approximately five per cent of
the issued share capital (8.3 million shares)
o expected FY dividend distribution for 2022 would equate to a yield of
approximately 9.0% based on the current share price
· Revenues grew 32% to $15.45 million (H1 2021: $11.7 million), due to
sustained high levels of production at Mnazi Bay and higher gas price due to
inflationary price mechanism
o low operational cost of production maintained at $0.45/Mscf (H1
2021: $0.49 Mscf); largely fixed insulating the Company from cost inflation
· Adjusted earnings before interest, taxes, depreciation, amortization,
and exploration (EBITDAX) increased by 43% to $9.6 million (H1 2021: $6.7
million)
· Strong financial position with $27.4 million cash (H1 2021: $22.8
million) and zero debt
· Tanzania Petroleum Development Corporation ("TPDC") continues to
remain fully current with all invoices for gas sales
· Tanzania Electric Supply Company ("TANESCO") continue to settle
arears
Operational
· Health and safety of employees, partners and local communities
continues to be a top priority for Wentworth. On 2 August 2022, the Company
celebrated six years without a Lost Time lncident (LTI)
· Average daily production of 92.3 MMscf/day (gross) during the first
six months of 2022, represents a record performance; a 14.9% increase from the
same period in 2021
· Average daily production for Q2 2022 was 86.3 MMscf/day (gross),
above the high end of guidance; demonstrating the increased demand even across
the traditional rainy season
· Wentworth's share of Gross 2P Reserves estimated to be 135.2 Bcf,
with a post-tax NPV10 of $108.9m as at 31 December 2021
· The gas compression project is advancing with a contractor selected
to perform the pre-FEED studies
· Upcoming slickline and perforation operations during H2 2022 have the
potential to support and add field production volumes
Corporate
· Growth within Tanzania, to capitalise on Wentworth's in-country track
record, continues to be a key focus as the Company seeks to leverage improving
demand dynamics and strong operational performance
· In June 2022, the Company reached an agreement with Scirocco Energy
plc ("Scirocco") to acquire its 25% non-operated working interest in the
Ruvuma Production Sharing Agreement in Tanzania. On 12 July 2022, the Company
announced that Scirocco was informed by its partner ARA Petroleum Tanzania
Ltd ("APT") of its intention to exercise its pre-emption rights in relation
to the Proposed Acquisition under the terms of the Joint Operating Agreement.
On 31 August 2022, Scirocco announced it had entered into binding agreements
with APT with a view to completing the disposal by 31 December 2022. This
pre-emption remains subject to approval by the Government of Tanzania
· The proposed pre-emption clearly demonstrates the potential of the
Ruvuma asset alongside Wentworth's ability to identify value and negotiate
favourable transactions in Tanzania
· Wentworth remains committed to identifying and pursuing further
opportunities within the country and the region
· Wentworth proudly sponsored the fourth Tanzania Energy Congress in
Dar es Salaam in early August. The congress aimed to accelerate and stimulate
market demand and drive new investment opportunities, through local, regional
and international partnerships
Sustainability
· A robust ESG framework underpins Wentworth's operations as evidenced
in the Company's second Sustainability Report, published in April 2022 in
accordance with the Sustainability Accounting Standards Board
· This Sustainability Report was formally presented to key in-country
stakeholders in August 2022 to complement Tanzania's wider sustainability
ambitions
· Wentworth continues to play a crucial role in increasing energy
access to communities across the country and acting as a key partner for the
Government of Tanzania to deliver on its ambition to provide universal energy
access in Tanzania by 2030, in line with the UN Sustainable Development Goals
· Continued progress on our community-focused carbon credit programmes
with Vitol SA, aimed at offsetting all Mnazi Bay Scope 1 and Scope 2 emissions
and partially offsetting Scope 3 emissions
· Developing a climate strategy to ensure effective measurement and
mitigation of climate-related impacts is a key focus for 2022
· An active member of the United Nations Global Compact (UNGC):
underlining Wentworth's commitment to operating responsibly
· Independently, and together with in-country stakeholders and
partners, Wentworth's Corporate Social Responsibility (CSR) projects aim to
address issues impacting communities close to Mnazi Bay and the wider Mtwara
region
Outlook
· Strong Tanzanian demand for power is anticipated throughout H2 2022,
primarily driven by:
o An increase in overall power demand nationwide;
o Stable demand from existing, and the connection of new, industrial
customers; and
o Below average rainfall within the catchment area serving hydroelectric
dams, consequently reducing hydro generation
· Current average daily production at or slightly above the high end of
production guidance is expected to continue during H2
Dividend
An interim dividend is declared of $0.8 cents per share ($1.45 million),
payable by mid-October 2022. A final dividend for the year ending 31
December 2022 will be determined by the Board with the full year results and
is expected to be approximately $2.9 million, in line with the Company's
stated policy of 1/3:2/3 split between the interim and final dividend.
Assuming a final dividend is declared, subject to shareholder approval, this
would equate to a total distribution of $4.4 million, representing a full year
dividend of $2.4 cents per share, a yield of approximately 9.0% at the current
share price.
The Company has introduced the option for shareholders to invest their
dividend in a Dividend Reinvestment Plan ("DRIP"). The DRIP is administered
by Link Market Services Trustees Limited and provides shareholders with the
opportunity to reinvest dividend payments to purchase additional ordinary
shares in the Company, in the market. For shareholders who wish to receive
their dividend in the form of shares, the deadline to elect for the DRIP is 16
September 2022.
Detail about the DRIP, including the terms and conditions and how to join or
exit the DRIP are available at www.signalshare.com
(http://www.signalshare.com) or by calling Link on +44 (0)371 664 0300. Calls
are charged at the standard geographic rate and will vary by provider. Calls
outside the United Kingdom will be charged at the applicable international
rate. Lines are open between 9.00am and 5.30pm, Monday to Friday, excluding
public holidays in England and Wales.
lnterim Dividend Payment Timetable:
· Ex-dividend date:
8 September 2022
· Record Date:
9 September 2022
· Latest date to make DRIP election:
16 September
2022
· US dollar to GBP £ calculation
date: 16 September 2022
· Payment Date:
7 October 2022
Following the closure of the VPS Register all dividends are paid on the same
date in GBP £.
lnterim Results Conference Calls
Analyst call
The Company is holding a conference call for analysts at 9:00am BST today,
Thursday 1 September. An updated presentation will be available at that time
on the Company's website: wentplc.com.
To register for the call, please click on the following link:
https://secure.emincote.com/client/wentworth/wentworth010/vip_connect
(https://secure.emincote.com/client/wentworth/wentworth010/vip_connect)
You can view the presentation during the call via the following link:
https://secure.emincote.com/client/wentworth/wentworth010
(https://secure.emincote.com/client/wentworth/wentworth010)
Shareholder Presentation
The Company is holding a live presentation and Q&A webinar for investors
at 1.00pm BST today, Thursday 1 September, via lnvestor Meet Company.
Το register for the call, please click on the following link:
https://www.investormeetcompany.com/wentworth-resources-plc/register-investor
(https://www.investormeetcompany.com/wentworth-resources-plc/register-investor)
Ends
Enquiries:
Wentworth Resources Katherine Roe katherine.roe@wentplc.com
Chief Executive Officer
+44 (0) 7841 087 230
Stifel Nicolaus Europe Limited AIM Nominated Adviser and Joint Broker +44 (0) 20 7710 7600
Callum Stewart
Ashton Clanfield
Simon Mensley
Peel Hunt LLP Joint Broker +44 (0) 20 7418 8900
Richard Crichton
Alexander Allen
FTI Consulting Communications Advisor +44 (0) 20 3727 1000
Sara Powell
Ben Brewerton
Ollie Mills
About Wentworth Resources
Wentworth Resources plc (AIM: WEN) is a leading, domestic natural gas producer
in Tanzania with a core producing asset at Mnazi Bay in the onshore Rovuma
Basin in Southern Tanzania.
NOTES
Cameron Snow, Head of Subsurface and Business Development, is a geologist
with 15 years' experience across North America, South America, Africa, and
Europe. He holds a BS in Geology from North Carolina State University, an
MS in Geology from Utah State University, a PhD in Geological and
Environmental Science from Stanford University, and an MBA from Imperial
College London. Mr. Snow has read and approved the technical disclosure in
this regulatory announcement.
RESERVE DEFINITIONS
These definitions are based on the Petroleum Resources Management System,
published in 2007, and revised in June 2018, and sponsored by the Society of
Petroleum Engineers (SPE), World Petroleum Council (WPC), American Association
of Petroleum Geologists (AAPG), Society of Petroleum Evaluation Engineers
(SPEE), Society of Exploration Geophysicists (SEG), Society of Petrophysicists
and Well Log Analysts (SPWLA), and the European Association of Geoscientists
& Engineers (EAGE).
Reserves
Reserves are those quantities of petroleum anticipated to be commercially
recoverable by application of development projects to known accumulations from
a given date forward under defined conditions. Reserves must satisfy four
criteria: discovered, recoverable, commercial, and remaining (as of the
evaluation's effective date) based on the development project(s) applied.
Reserves are classified according to a range of uncertainty according to the
following categories:
Proved Reserves (P1)
Proved Reserves are those quantities of Petroleum that, by analysis of
geoscience and engineering data, can be estimated with reasonable certainty to
be commercially recoverable from known reservoirs and under defined technical
and commercial conditions. If deterministic methods are used, the term
"reasonable certainty" is intended to express a high degree of confidence that
the quantities will be recovered. If probabilistic methods are used, there
should be at least a 90% probability that the quantities actually recovered
will equal or exceed the estimate.
Probable Reserves (P2)
Probable Reserves are those additional Reserves which analysis of geoscience
and engineering data indicate are less likely to be recovered than Proved
Reserves but more certain to be recovered than Possible Reserves. It is
equally likely that actual remaining quantities recovered will be greater than
or less than the sum of the estimated Proved plus Probable Reserves (2P). In
this context, when probabilistic methods are used, there should be at least a
50% probability that the actual quantities recovered will equal or exceed the
2P estimate.
Glossary
Bcf/Bscf Billion standard cubic feet
Mscf Thousand standard cubic feet
MMscf Million standard cubic feet
Inside Information
The information contained within this announcement is deemed by Wentworth to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) no. 596/2014 ("MAR"). On the publication of this announcement via
a Regulatory Information Service ("RIS"), this inside information is now
considered to be in the public domain.
CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME
Six months ended 30 June
2022 2021
(unaudited) (unaudited)
Note $000 $000
Total revenue 4 15,447 11,663
Production and operating costs (1,922) (1,655)
Depletion 10 (3,945) (3,324)
Total cost of sales (5,867) (4,979)
Gross profit 9,580 6,684
Recurring administrative costs 5 (3,028) (2,974)
New venture and pre-licence costs (232) (263)
Share-based payment charges 15 (472) (167)
Depreciation 10 (49) (1)
Total costs (3,781) (3,405)
Profit from operations 5,799 3,279
Finance income 6 45 30
Finance costs 6 (290) (590)
Profit before tax 5,554 2,719
Current tax expense (223) (118)
Deferred tax expense 841 759
618 641
Net and comprehensive profit after tax 6,172 3,360
Net profit per ordinary share
Basic and diluted (US$/share) 18 0.03 0.018
CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION
30 June 31 December
2022 2021
(unaudited) (audited)
Note $000 $000
ASSETS
Current assets
Cash and cash equivalents 27,382 22,820
Trade and other receivables 7 9,345 5,550
36,727 28,370
Non-current assets
Exploration and evaluation assets 9 8,129 8,129
Property, plant and equipment 10 62,884 66,465
Deferred tax asset 9,080 8,239
80,093 82,833
Total assets 116,820 111,203
LIABILITIES
Current liabilities
Trade and other payables 12 1,660 2,503
Dividend payable 19 2,680 -
4,340 2,503
Non-current liabilities
Decommissioning provision 13 2,009 1,929
Lease liability 14 14 36
2,023 1,965
Equity
Share capital 17 414,828 414,919
Equity reserve 27,016 26,695
Accumulated deficit (331,387) (334,879)
110,457 106,735
Total liabilities and equity 116,820 111,203
The condensed consolidated financial statements of Wentworth Resources plc,
registered number 127571, were approved by the Board of Directors and
authorised for issue on 1 September 2022.
Signed on behalf of the Board of Directors.
Katherine Roe
Chief Executive Officer
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY
Number of shares Share capital Equity reserve Accumulated Total
Note deficit equity
$000 $000 $000 $000
Balance at 31 December 2020 (audited) 186,488,465 416,426 26,656 (337,049) 106,033
Dividends 19 - - - (3,920) (3,920)
Net profit and comprehensive profit - - - 6,067 6,067
Share based compensation 15 - - 537 - 537
Cancellation of own shares 16 (939,326) (318) 295 23 -
Repurchase of own shares 16 (4,500,000) (1,189) (793) - (1,982)
Balance at 31 December 2021 (audited) 181,049,139 414,919 26,695 (334,879) 106,735
Dividends 19 - - - (2,680) (2,680)
Repurchase of own shares 16 (866,572) (91) (151) - (242)
Net profit and comprehensive profit - - - 6,172 6,172
Share based compensation 15 - - 472 - 472
Balance at 30 June 2022 (unaudited) 180,182,567 414,828 27,016 (331,387) 110,457
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
Six months ended 30 June
2022 2021
(unaudited) (unaudited)
Note $000 $000
Operating activities
Net profit for the year 6,172 3,360
Adjustments for:
Depreciation and depletion 10 3,994 3,325
Net finance costs 6 220 560
Income tax expense (618) (641)
Share based compensation 15 472 167
10,240 6,771
Change in non-cash working capital:
Trade and other receivables (3,794) (2,041)
Trade and other payables (1,019) 545
Cash generated from operating activities 5,427 5,275
Current tax paid (223) (118)
Withholding tax paid - (440)
Net cash generated from operating activities 5,204 4,717
Investing activities
Additions to property, plant and equipment 10 (402) (29)
Interest income 36 19
Proceeds from disposal 9 -
Net cash used in investing activities (357) (10)
Financing activities
Repurchase of own shares 16 (242) -
Lease payment 14 (28) -
Bank charges 6 (15) (11)
Net cash used in financing activities (285) (11)
Net change in cash and cash equivalents 4,562 4,696
Cash and cash equivalents, beginning of the period 22,820 17,787
Cash and cash equivalents, end of the period 27,382 22,483
( )
1. Incorporation and basis of preparation
Wentworth Resources plc ("Wentworth" or the "Company") is a domestic natural
gas producer in Tanzania. These unaudited condensed consolidated interim
financial statements include the accounts of the Company and its subsidiaries
(collectively referred to as the "Wentworth Group" or simply the "Group").
Wentworth is a gas exploration, development and production company
incorporated in Jersey and listed on the AIM Market of the London Stock
Exchange (ticker: WEN).
The Company's principal place of business is located at 4th Floor, St Paul's
Gate, 22-24 New Street, St Hellier, Jersey JE1 4TR.
The Company maintains offices in Dar es Salaam in the United Republic of
Tanzania and Jersey.
2. Summary of significant accounting policies
Use of judgements and estimates
In preparing these interim financial statements, management has made
judgements and estimates that affect the application of accounting policies
and the reported amounts of assets and liabilities, income and expenses.
Actual results may differ from these estimates.
The significant judgements made by management in applying the Group's
accounting policies and the key sources of estimation uncertainty were the
same as those described in the 2021 annual report and financial statements.
Going concern
Directors and senior management continue to allocate considerable resources to
ensuring that Wentworth is well placed to continue to safely produce gas from
Mnazi Bay alongside the Operator, Maurel et Prom. Given the essential nature
of services provided and the forecasted impact of recent world events to both
international capital markets and production operations in the United Republic
of Tanzania, the Group notes that an interruption to production is remote.
The Directors however are mindful of the speed with which circumstances may
change, both for the better or for the worse, and all modelling is based on
the most current information available.
The Group has a long established and collaborative relationship with the
Government of the United Republic of Tanzania, having operated in-country for
many years, however the Directors do recognise that the Group is dependent
upon the continued collection of gas sales invoices and ongoing operational
support of the Government as its sole gas sales customer through its operating
agencies Tanzania Petroleum Development Corporation ("TPDC") and Tanzania
Electric Supply Company Limited ("TANESCO").
The Directors have, therefore, judged that on a risk-weighted basis, which
takes into consideration both the probability of occurrence and an estimate of
the financial impact, the continued timely settlement of gas-sales invoices by
the Government of the United Republic of Tanzania to be the most significant
risk currently faced by the Group. To this end, should no settlement of future
gas sales invoices be received from the date of approval of these financial
statements, we have assessed that the Group would be able to continue to
operate for a period of up to 23 months without the need for a further
injection of working capital.
Further to this, based on the application of reasonable and foreseeable
sensitivities, which include potential changes in demand, capital spend and
operating costs, the Directors believe that the Group is well placed to manage
its financial exposures. The Directors have judged that owing to the stability
of this relationship, the Group has sufficient cash resources for its working
capital needs, committed capital and operational expenditure programmes for at
least the next 23 months based on the Directors worst case scenario of no
settlement of future gas sales as noted above.
Consequently, the Directors are confident that the Group will have sufficient
funds to continue to meet its liabilities as they fall due for at least 12
months from the date of approval of the financial statements and therefore
have prepared the financial statements on a going concern basis.
Basis of presentation and statement of compliance
These unaudited condensed consolidated interim financial statements have been
prepared by management in accordance with International Accounting Standard
34, "Interim Financial Reporting". The preparation of interim financial
statements requires management to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported amounts of
assets and liabilities, income and expenses. Actual results may differ from
these estimates.
These unaudited condensed consolidated interim financial statements have been
prepared following the same accounting policies as the annual audited
consolidated financial statements for the year ended 31 December 2021 and
should be read in conjunction with the annual audited consolidated financial
statements and the notes thereto. These unaudited condensed consolidated
interim financial statements were approved by the Board of Directors on 31
August 2022. The disclosures provided below are incremental to those included
in the 2021 annual consolidated financial statements.
The information for the year ended 31 December 2021 included in the report was
derived from the statutory accounts for that year which were prepared in
accordance with Jersey Company Law. Under that law the Directors have elected
to prepare the Group financial statement in accordance with UK-adopted
international accounting standards, in conformity with the requirements of the
Companies (Jersey) Law 1991. The auditor's opinion in relation to those
accounts was unqualified, did not draw attention to any matters by way of
emphasis or any other matters as may be required under The Companies (Jersey)
Law 1991.
Functional and presentation currency
These consolidated financial statements are presented in US dollars which is
the functional currency of the Group.
Basis of consolidation
These unaudited condensed consolidated interim financial statements include
the accounts of the Company and its subsidiaries. Subsidiaries are entities
that the Company controls. An investor controls an investee when it is
exposed, or has rights, to variable returns from its involvement with the
investee and can affect those returns through its authority over the
investee. The existence and effect of potential voting rights are considered
when assessing whether a company controls another entity. Subsidiaries are
fully consolidated from the date on which control is transferred to the
Company. They are deconsolidated from the date that control ceases.
The legal entities within the Wentworth Group are noted in note 11 of this
report.
Changes in accounting policies.
The following accounting standards, amendments and interpretations, which had
no significant impact on these financial statements, became effective in the
current reporting period on adoption in the United Kingdom of Great Britain
through the newly established UK Endorsement Board ("UKEB"):
IAS 37 (amendments) 'Onerous Contracts - Cost of Fulfilling a Contract': The
IASB effective date is 1 January 2022 and the UKEB adopted the amendment on 12
April 2022. The amendments specify that the 'cost of fulfilling' a contract
comprises the 'costs that relate directly to the contract'. Costs that relate
directly to a contract can either be incremental costs of fulfilling that
contract (examples would be direct labour, materials) or an allocation of
other costs that relate directly to fulfilling contracts (an example would be
the allocation of the depreciation charge for an item of property, plant and
equipment used in fulfilling the contract). This amendment is not expected to
have impact on the Group's consolidated financial statements.
IAS 16 (amendments) 'Property, Plant and Equipment - Proceeds before Intended
Use': The IASB effective date is 1 January 2022 and the UKEB adopted the
amendment on 12 April 2022. The amendments prohibit deducting from the cost of
an item of property, plant and equipment any proceeds from selling items
produced while bringing that asset to the location and condition necessary for
it to be capable of operating in the manner intended by management. Instead,
an entity recognises the proceeds from selling such items, and the cost of
producing those items, in profit or loss. This amendment is not expected to
have impact on the Group's consolidated financial statements.
Future accounting pronouncements
At the date of these interim financial statements the standards and
interpretations listed below were issued but not yet effective. The adoption
of these standards may result in future changes to existing accounting
policies and disclosures. The Company is currently evaluating the impact that
these standards will have on results of operations and financial position:
Standard Description IASB Issue Date IASB Effective Date Secretary of State Adoption Date
IAS 1 (amendments) Classification of Liabilities as Current or Non-current. 23 January 2020 1 January 2023 Endorsed
IFRS 17 Insurance contracts. 25 June 2020 1 January 2023 Endorsed
IAS 12 (Amendments) Deferred tax related to assets and liabilities arising from a single 7 May 2021 1 January 2023 Endorsed
transaction.
IAS 8 (amendments) Definition of accounting estimates. 12 February 2021 1 January 2023 Endorsed
IAS 1 and IFRS Practice Statement 2 (amendments) Disclosure of accounting policies. 12 February 2021 1 January 2023 Endorsed
3. Segment information
Net income/(loss) for the six months ended 30 June 2022
Tanzania Operations
(unaudited) Corporate Consolidated
$000 (unaudited) (unaudited)
$000 $000
Total revenue 15,447 - 15,447
Production and operating costs (1,922) - (1,922)
Depletion (3,945) - (3,945)
Total cost of sales (5,867) - (5,867)
Gross profit 9,580 - 9,580
Recurring administrative costs (1,968) (1,060) (3,028)
New venture and pre - licence costs - (232) (232)
Share-based payment charges (77) (395) (472)
Depreciation (49) - (49)
Total costs (2,094) (1,687) (3,781)
Profit/(loss) from operations 7,486 (1,687) 5,799
Net finance costs (104) (141) (245)
Profit/(loss) before tax 7,382 (1,828) 5,554
Current tax expense (223) - (223)
Deferred tax expense 841 - 841
Net and comprehensive Profit/(loss) from continued operations 8,000 (1,828) 6,172
Net income/(loss) for the six months ended 30 June 2021
Tanzania Operations
(unaudited) Corporate Consolidated
$000 (unaudited) (unaudited)
$000 $000
Total revenue 11,663 - 11,663
Production and operating costs (1,655) - (1,655)
Depletion (3,324) - (3,324)
Total cost of sales (4,979) - (4,979)
Gross profit 6,684 - 6,684
Recurring administrative costs (767) (2,207) (2,974)
New venture and pre - licence costs - (263) (263)
Share-based payment charges (36) (131) (167)
Depreciation (1) - (1)
Total costs (804) (2,601) (3,405)
Profit/(loss) from operations 5,880 (2,601) 3,279
Net finance costs (44) (516) (560)
Profit/(loss) before tax 5,836 (3,117) 2,719
Current tax expense (118) - (118)
Deferred tax expense 759 - 759
Net and comprehensive Profit/(loss) from continued operations 6,477 (3,117) 3,360
Selected balances as at 30 June 2022
Mozambique Operations
Tanzania Operations (Discontinued)
(unaudited) (unaudited) Corporate Consolidated
$000 $000 (unaudited) (unaudited)
$000 $000
Current assets 18,831 101 17,795 36,727
Exploration and evaluation assets 8,129 - - 8,129
Property, plant and equipment 62,884 - - 62,884
Deferred tax asset 9,080 - - 9,080
Total assets 98,924 101 17,795 116,820
Current liabilities 1,160 - 3,180 4,340
Non-current liabilities 2,023 - - 2,023
Total Liabilities 3,183 - 3,180 6,363
Capital additions for the six months ended 30 June 2022
Additions to property, plant
and equipment 413 - - 413
Selected balances as at 30 June 2021
Mozambique Operations
Tanzania Operations (Discontinued)
(unaudited) (unaudited) Corporate Consolidated
$000 $000 (unaudited) (unaudited)
$000 $000
Current assets 19,764 101 8,505 28,370
Exploration and evaluation assets 8,129 - - 8,129
Property, plant and equipment 66,464 - 1 66,465
Deferred tax asset 8,239 - - 8,239
Total assets 102,596 101 8,506 111,203
Current liabilities 1,704 - 799 2,503
Non-current liabilities 1,965 - - 1,965
Total Liabilities 3,669 - 799 4,468
Capital additions for the six months ended 30 June 2021
Additions to property, plant 29 - - 29
and equipment
4. Revenue
Six months ended 30 June
2022 2021
(unaudited) (unaudited)
$000 $000
Revenue from gas sales 15,224 11,530
Revenue from condensate sales - 12
Other revenue 223 121
15,447 11,663
Other revenue represents the recovery of corporate income taxes incurred
through adjustments to TPDC gas sales entitlements.
5. General and administrative costs
Six months ended 30 June
2022 2021
(unaudited) (unaudited)
$000 $000
Employee salaries and benefits 1,096 1,054
Contractors and consultants 536 476
Travel and accommodation 157 58
Professional, legal and advisory 325 326
Office and administration 211 225
Corporate and public company costs 703 835
Total general and administrative costs 3,028 2,974
6. Finance income and finance costs
Six months ended 30 June
2022 2021
(unaudited) (unaudited)
$000 $000
Finance income
Interest income 36 19
Gain on disposal of office and other equipment (note 10) 9 -
Reversal of credit losses on TANESCO receivable - 11
45 30
Finance costs
Foreign exchange loss (167) (76)
Accretion - decommissioning provision (80) (63)
Intercompany loan withholding tax costs (25) -
Bank Fees & Service Charge (15) (11)
Lease interest expenses (note 14) (3) -
Dividend withholding tax costs - (440)
(290) (590)
Net finance costs (245) (560)
7. Trade and other receivables
Balance at Balance at
30 June 2022 31 December 2021
(unaudited) (audited)
Receivable from the Operator 3,976 1,087
Trade receivables from TPDC 2,471 1,917
Trade receivables from TANESCO 898 351
Other receivables from TPDC( ) 136 378
Other receivables 1,864 1,817
9,345 5,550
Receivable from the Operator: At 30 June 2022, $4.0 million was receivable
from the Operator, Maurel et Prom, which includes amounts received from TPDC
of $3.9 million (December 2021: $1.0 million) and TANESCO of $108k (December
2021: $62k) on behalf of Wentworth. With the mutual consent of both parties,
these amounts were retained by the Operator pending the clarification of
repatriation terms with the Government of Tanzania. This clarification was
received in August 2022, at which point all previously retained amounts were
paid to Wentworth.
Receivable from TPDC: Comprise trade receivables of $2.5 million (December
2021: $1.9 million) were due from TPDC, representing one-month of gas sales.
This was settled in full in July 2022.
Receivable from TANESCO: Comprise trade receivables of $898k (December 2021:
$351k) were due from TANESCO, representing seven-months of gas sales (December
2021: three months). Subsequent to 30 June 2022, TANESCO have paid two of
these invoices, totalling $193k.
Other receivables from TPDC: Comprise income tax of $136k (December 2021:
$378k) paid by WGL, a wholly owned subsidiary of the Company. The income tax
is anticipated to be recovered from TPDC's share of profit gas within the next
12-months under the terms of the Mnazi Bay PSA, which provides such a
mechanism for the recovery of all corporate taxes.
Other receivables: Comprise VAT recoverable of $969k (December 2021: $886k),
gas condensate sales of $80k (December 2021: $80k), corporate tax prepayments
of $508k (December 2021: $483k), prepaid insurance $79k (December 2021: $88k)
and other prepayments of $228k (December 2021: $280). In accordance with IFRS
9, the Company notes no material expected credit losses. Tanzania Government
receivables.
8. Government of Tanzania receivables
The Group has an agreement with the Government of the United Republic of
Tanzania (TANESCO, TPDC and the Ministry of Energy and Minerals) to be
reimbursed for all the project development costs associated with Umoja
transmission and distribution expenditures at cost, which was divested on 7
February 2012.
The Government is conducting an ongoing review and due to the age and
uncertainty surrounding the receivable and its recoverability, the Group made
a provision in-full during 2018 against the carrying amount without prejudice
to the ongoing commercial discussions with the Government, the Group has
reviewed this at the year-end and continues to feel the provision is
appropriate.
9. Exploration and evaluation assets
$000
Balance at 31 December 2021 (audited) 8,129
and 30 June 2022 (unaudited)
Exploration costs comprise the acquisition and interpretation of 3D Seismic
225 Km² and 2D High Resolution Seismic 281 Km² at Mnazi Bay.
There have been no indicators of impairment during the period and as such no
full impairment review has been undertaken.
10. Property, plant and equipment
Natural gas properties Office and other equipment Right of use
Total
$000 $000 $000 $000
Cost
Balance at 31 December 2021 (audited) 104,717 630 105,471
124
Additions 219 183 11 413
Disposals - (183) - (183)
Balance at 30 June 2022 (unaudited) 104,936 630 105,701
135
Accumulated depreciation and depletion
Balance at 31 December 2021 (audited) (38,364) (597) (39,006)
(45)
Depletion and depreciation (3,945) (23) (26) (3,994)
Disposals - 183 - 183
Balance at 30 June 2022 (unaudited) (42,309) (437) (42,817)
(71)
Carrying amounts
31 December 2021 (audited) 66,353 33 79 66,465
30 June 2022 (unaudited) 62,627 193 64 62,884
There have been no indicators of impairment during the period and as such no
full impairment review has been undertaken.
During the six months, the Group made cash additions to PPE totaling $402k
(2021: $29k). Right of use asset addition of $11k (2020: nil) relates to
office space leased in Tanzania.
During the period the Group sold a number of motor vehicles which were carried
at a cost of $183k and were fully depreciated at the date of disposal. A gain
on disposal of $9k was recognised within finance income (note 6).
11. Subsidiary undertakings
The principal subsidiary undertakings as at 30 June 2022 are:
Name of Company Country of incorporation Class of shares held Types of ownership Percentage holding Nature of business
Wentworth Resources (UK) Limited United Kingdom Ordinary Direct 100% Investment holding company
Wentworth Holdings (Jersey) Limited Jersey Ordinary Direct 100% Investment holding company
Wentworth Tanzania (Jersey) Limited Jersey Ordinary Indirect 100% Investment holding company
Wentworth Gas (Jersey) Limited Jersey Ordinary Indirect 100% Investment holding company
Wentworth Gas Limited Tanzania Ordinary Indirect 100% Exploration production company
Cyprus Mnazi Bay Limited Cyprus Ordinary Indirect 39.925% Exploration production company
Wentworth Mozambique (Mauritius) Limited Mauritius Ordinary Indirect 100% Investment holding company
Wentworth Moçambique Petroleos, Limitada (1) Mozambique Ordinary Indirect 100% Exploration company
(1) Wentworth Moçambique Petroleos, Limitada is in the process of liquidation
after relinquishment of the Tembo Block Appraisal Licence
12. Trade and other payables
Balance at Balance at
30 June 2022 31 December 2021
(unaudited) (audited)
$000 $000
Payable to Mnazi Bay Operator 894 1,222
Trade payables 404 250
Other payables and accrued expenses 362 1,031
1,660 2,503
The payable to Mnazi Bay Operator represents the accrued cash call for the
second quarter of 2022 for field costs between 1 April and 30 June 2021
totaling $894k (December 2022: 1.2 million). The cash call was settled in July
2022.
Other payables and accrued expenses include audit fees accrual $248k (December
2021: $320k), Other third-party services of $39k (December 2021: $59K),
payroll taxes $21k (December 2021: nil) and current lease liability $54k
(December 2021: $46k).
13. Decommissioning and Abandonment provision
A reconciliation of the decommissioning obligations is provided below:
Balance at Balance at
30 June 2022 31 December 2021
(unaudited) (audited)
$000 $000
Balance at 1 January 1,929 1,514
Change in accounting estimates - 289
Accretion 80 126
Balance at 30 June and 31 December 2,009 1,929
14. Lease liability
The Group recognised a lease liability of $68k (December 2021: $82k), $54k of
which is current (December 2021: $46k) and is presented in trade and other
payables:
Balance at Balance at
30 June 2022 31 December 2021
(unaudited) (audited)
$000 $000
Balance at 1 January 82 -
Additions 11 124
Lease interest expenses 3 8
Lease payment (28) (50)
Balance at 31 December 68 82
Current 54 46
Non-current 14 36
15. Share-based payments
Six months ended 30 June
2022 2021
(unaudited) (audited)
$000 $000
Share based compensation recognized in the statement of Comprehensive income 472 167
Movement in the total number of share options outstanding and their related
weighted average exercise prices are summarized as follows:
Number of Weighted average exercise price (US$))
options
Outstanding at 1 January 2022 10,749,451 0.17
Granted 4,031,020 -
Lapsed (495,422) -
Outstanding at 30 June 2022 14,285,049 0.13
The following table summarizes share options outstanding and exercisable at 30
June 2022:
Outstanding Exercisable
Exercise price (NOK) Exercise price (US$)(1) Number of options Weighted average remaining life (years) Number of options
- - 1,016,430 10 -
- - 3,014,590 9.8 -
- - 957,447 9.4 -
- - 3,368,368 9.0 -
- - 942,593 8.1 -
- - 2,485,621 7.5 -
3.85 0.39 750,000 3.5 750,000
5.18 0.53 1,500,000 1.9 1,500,000
4.08 0.41 250,000 0.8 250,000
14,285,049 2,500,000
( )
(1) The US Dollar to Norwegian Kroner exchange rate used for determining the
exercise price at 30 June 2022 is 0.10149
16. Repurchase of own shares
2022 2021
unaudited audited
$000 $000
Settlement of 866,572 ordinary shares at total cost £184k 242 -
Settlement of 7,500,000 ordinary shares at total cost £1.5 million - 1,982
242 1,982
During the six months, the Company incurred $242k to repurchase 866,572
ordinary shares, 330,078 repurchased at cost of $91k were cancelled and
removed from the register during the period, the balance of 536,494
repurchased at cost of $151k were cancelled and removed from the register in
July 2022. At 30 June 2022, the Company held 3,536,494 shares in treasury
(2021: nil).
On 17 December 2021, the Company incurred $2.0 million to repurchase 7,500,000
ordinary shares of which 4,500,000 ordinary shares were cancelled and removed
from the share register on 30 December 2021 and 3,000,000 ordinary shares were
held in treasury and recognised within equity reserves to satisfy upcoming
obligations in respect of an employee share plan.
17. Share capital
Authorised, called up, allotted and fully paid 2022 2021
Balance at Ba
la
30 June 2022 (unaudited) nc
e
at
31
De
ce
mb
er
20
21
(a
ud
it
ed
)
Ordinary shares $000 Ordinary shares $000
Balance at 1 January 181,049,139 414,919 186,488,465 416,426
Repurchase of own shares: Cancelled and removed from share registrar on 3
February 2021
- - (939,326) (318)
Repurchase of own shares: Cancelled and removed from share registrar on 30
December 2021
- - (4,500,000) (1,189)
Repurchase of own shares: Cancelled and removed from share registrar during
the six months of 2022.
(330,078) (91) - -
Balance at 30 June and 31 December 180,719,061 414,828 181,049,139 414,919
The holders of ordinary shares are entitled to receive dividends as declared
from time to time and are entitled to one vote per share at meetings of the
Company.
18. Earnings per share
Basic and diluted EPS
2022 2021
(unaudited) (audited)
$000 $000
Net profit for the period 6,172 3,360
Weighted average number of ordinary shares outstanding 180,842,175 185,720,397
Dilutive weighted average number of ordinary shares outstanding 192,627,224 185,720,397
Net profit per ordinary share 0.03 0.018
19. Dividends
The following dividends were declared (2021: declared and paid) by the
Company during the year.
2022 2021
(unaudited) (audited)
$000 $000
1.16 pence (2021: 1.0 pence) per ordinary share 2,680 2,600
On 23 July 2021, the Company paid shareholders who hold shares on the UK
Register the final year 2020 dividend of 1.0 pence per ordinary share and on 6
August 2021, the Company paid shareholders who hold shares on the VPS Register
the final year 2020 dividend of 1.0 pence per ordinary share. The total final
dividend distribution was $2.6 million.
On 8 October 2021, the Company paid an interim dividend of 0.52 pence per
ordinary share ; The total interim dividend distribution being $1.3 million.
On 6 April 2022, the Company declared a final dividend of 1.16 pence per
ordinary share which was paid on 29 July 2022, being a total dividend
distribution of $2.7 million. The declared and paid final dividend bring
distributions to shareholders with regard to the financial year ended 31
December 2021 to $4.0 million.
20. Subsequent events
Potential Exercise of Ruvuma Pre-Emption Rights
In June 2022, the Company reached agreement with Scirocco Energy plc
("Scirocco") to acquire its 25% non-operated working interest in the Ruvuma
Production Sharing Agreement ("Ruvuma Asset") in Tanzania.
On 12 July 2022, the Company announced that, Scirocco was informed by its
partner ARA Petroleum Tanzania Ltd of its intention to exercise its
pre-emption rights in relation to the Proposed Acquisition under the terms of
the Joint Operating Agreement. This pre-emption would be subject to approval
by the Government of Tanzania.
In addition, Scirocco confirmed that TPDC had indicated that it was
considering exercising its statutory right of first refusal in relation to the
Proposed Acquisition pursuant to Section 86(5) of the Petroleum Act 2015. On
19 August 2022, Scirocco released an update that TPDC had confirmed they would
not be exercising this right. On 31 August 2022, Scirocco announced it had
entered into binding agreements with APT with a view to completing the
disposal by 31 December 2022.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR FLFVDTTILVIFRecent news on Wentworth Resources
See all newsREG - Wentworth Resources - Cancellation of Trading of Wentworth Shares
AnnouncementREG - AIM Wentworth Resources - Cancellation - Wentworth Resources plc
AnnouncementREG - Maurel & Prom Wentworth Resources - Update on Acquisition of Wentworth Resources PLC
AnnouncementREG - Stifel Nicolaus Euro Wentworth Resources Maurel & Prom - Form 8.5 (EPT/RI) - Wentworth Resources plc
AnnouncementREG - Peel Hunt LLP Wentworth Resources - Form 8.5 (EPT/RI) - Wentworth Resources Plc
Announcement