TIDMADME
RNS Number : 6189N
ADM Energy PLC
30 September 2021
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014 (WHICH FORMS PART OF
DOMESTIC UK LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT
2018). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE
INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.
30 September 2021
ADM Energy plc
("ADM" or the "Company")
Interim Results
ADM Energy plc (AIM: ADME; BER and FSE: P4JC), a natural
resources investing company, announces its interim results for the
six months ended 30 June 2021.
Investment Highlights:
OML 113 - Aje Field, Nigeria (9.2% equity investment)
-- Two wells (Aje-4 and Aje-5) producing at an average of 1,360
bopd (H1 2020: 2,126 bopd), equating to a current net rate to ADM
of 125 bopd (H1 2020: 106 bopd) The drop in volume reflected the
decision by the JV partners to continue a more thorough and
extended period of maintenance on the FPSO while oil prices were
depressed.
-- Total gross production volume of approximately 246,240
barrels of oil from 1 January to 30 June 2021
-- 15(th) Lifting in April 2021 marked the first lifting since
the Company finalised an agreement in December 2020 to consolidate
its interest in the asset
-- Acquired an indirect interest in a Risk Sharing Agreement
(RSA) for the development of the Barracuda Field
Superdielectrics
-- Disposed of 188,778 shares in Superdielectrics Ltd for a
total consideration of GBP849,501, a profit of GBP656,003 on ADM's
original investment
Corporate Highlights:
-- Extended strategic alliance MoU with Trafigura for a further
12 months to develop African energy projects and provide
conditional pre-finance of up to US$120 million
-- Raised GBP1,220,000 in an equity fundraising in March 2021
-- Post period, ADM strengthened the Board and technical team by
adding high-calibre individuals with industry expertise and
experience:
o Oliver Andrews, former Chief Investment Officer at the African
Finance Corporation, appointed Non-executive Chairman
o Industry veteran Dr Babatunde Pearse appointed to the
technical team as Chief Engineer to oversee the next phase of
development at Aje
Enquiries:
ADM Energy plc +44 20 7459 4718
Osamede Okhomina, CEO
www.admenergyplc.com
Cairn Financial Advisers LLP +44 20 7213 0880
(Nominated Adviser)
Jo Turner, James Caithie
Arden Partners plc +44 20 7614 5900
(Lead Broker)
Paul Shackleton
Hybridan LLP +44 20 3764 2341
(Joint Broker)
Claire Louise Noyce
ODDO BHF Corporates & Markets AG +49 69 920540
(Designated Sponsor)
Michael B. Thiriot
Luther Pendragon +44 20 7618 9100
(Financial PR)
Harry Chathli, Alexis Gore
About ADM Energy PLC
ADM Energy PLC (AIM: ADME; BER and FSE: P4JC) is a natural
resources investing company with an existing asset base in Nigeria.
ADM Energy holds a 9.2% profit interest in the oil producing Aje
Field, part of OML 113, which covers an area of 835km(2) offshore
Nigeria. Aje has multiple oil, gas, and gas condensate reservoirs
in the Turonian, Cenomanian and Albian sandstones with five wells
drilled to date.
ADM Energy is seeking to build on its existing asset base in
Nigeria and target other investment opportunities across the West
African region in the oil and gas sector with attractive risk
reward profiles such as proven nature of reserves, level of
historic investment, established infrastructure and route to early
cash flow.
Operating Review
ADM continued to make progress on its strategy to build a
multi-asset portfolio by targeting projects with highly attractive
risk-reward profiles. In particular, the six months to 30 June 2021
marked the first full period since the Company consolidated its
position in OML 113, increasing ADM's profit interest from 5% to
9.2%, and resulted in a significantly higher rate of net
production.
The Company was active in pursuing new opportunities and
extended its MOU with global trading house Trafigura Pte Ltd
("Trafigura"). Post period, the ADM further strengthened its Board
and technical team with the appointment of Oliver Andrews as
Non-executive Chairman and Dr Babatunde Pearse as Chief
Engineer.
OML 113 - Aje Field
In the six months to 30 June 2021, oil production continued from
two wells at the Aje Field (Aje-4 and Aje-5) at an average of 1,360
bopd (H1 2020: 2,126 bopd). Total gross production volume amounted
to approximately 246,240 barrels of oil. Following the completion
of the transaction with EER (Colobos) Nigeria Limited ("EER") in
December 2020, the Company benefitted from an increased 9.2% profit
interest in the field. As a result, the net rate of production
attributable to ADM increased to 167 bopd (H1 2020: 106 bopd).
In April 2021, the Company announced the completion of the 15th
Lifting at the Aje Field for a total of 225,000 barrels (52,000
barrels were left in the tank). In this first Lifting since ADM
consolidated its interest in the Aje Field, the Company received a
net share of 27,675 barrels, which equated to ADM's paying interest
of approximately 12.3%. The proceeds of the Lifting were applied
against the project debt, significantly reducing the outstanding
balance.
Superdielectrics
In May 2021, the Company completed the sale of 188,778 shares in
Superdielectrics Ltd ("Superdielectrics") for a total consideration
of GBP829,501, a profit of GBP656,00 on ADM's original investment.
The sale followed a funding round by Superdielectrics in October
2020 that valued ADM's total holding at GBP877,500, representing a
total book profit of GBP677,625 and an increase in value of
approximately 340%. ADM retains a holding of 6,222 shares in
Superdielectrics following the sale.
OML 141 - Barracuda Field
In March 2021, the Company acquired an indirect interest in a
Risk Sharing Agreement ("RSA") for the development of the Barracuda
Field. Located in OML 141, the Barracuda Field is an existing
discovery and near-term production asset, which covers 103 km(2) in
the swamp/shallow waters of the Niger Delta. The Company has
commissioned a Competent Person's Report ("CPR") on the Barracuda
Field. ADM has received a draft of a preliminary report however it
is not yet finalised pending further technical appraisal. Once
finalised, ADM will be in a better position to conclude the full
CPR report as well as its strategy for the Barracuda field.
Extension of Trafigura MOU
Access to capital is a key competitive advantage for ADM and
supports the Company's strategy to acquire undervalued assets and
unlock value. In January 2021, the Company announced a 12-month
extension to its indicative MOU with Trafigura, the
multi-billion-dollar global trading house. The intention is to
create a strategic alliance where ADM will act as the sponsor for
investment opportunities, with Trafigura providing up to US$100
million in approved project finance as well as up to US$20 million
of convertible loan notes. The Company has engaged Trafigura on a
number of potential deals to date and this extension is a
reflection of the strong relationship between both parties.
Corporate Developments
Post period, the Company appointed Oliver Andrews as the new
Non-executive Chairman following the departure of Peter Francis due
to personal circumstances. Mr Andrews is the former Chief
Investment Officer at the Africa Finance Corporation, one of the
largest investment funds in Africa. Over the last 35 years, he has
overseen investments of approximately US$10bn and originated
investments deals in natural resources and infrastructure across
the continent, worth US$100bn.
In addition, ADM further bolstered its technical team to advance
the Company's existing assets and evaluate new prospects. Having
last year enlisted non-Board advisors, Darrell McKenna and Dr
Satinder Purewal as Lead Technical consultants, the Company
appointed Dr Babatunde Pearse, as Chief Engineer post period. Dr
Pearse is an industry veteran with an extensive background with
International Oil Companies ("IOC"s). He is primarily responsible
for planning the next phase of the Aje development and oversees
Front End Engineering Design ("FEED") studies to support the Final
Investment Decision.
Financial Review
On 24 March 2021 the company announced an oversubscribed
fundraising. The company issued 28,710,250 shares at 4.25p for a
total amount of GBP1,220,000 before expenses.
On 8th April 2021, the company issued 443,627 shares to settle
various loans. 208,333 shares were issued at 2.4 pence per share,
235,294 shares were issued at 4.25 pence per share.
On 28th April, the company announced it completed a controlling
interest in a Risk Sharing Agreement for the development of the
large-scale Barracuda Field in OML 141. Initial consideration was
$0.25m along with 5,657,912 of ADM shares at a price of 7 pence per
share.
On 4th May 2021, ADM's CEO Osa Okhomina purchased 480,446
ordinary shares at 3.45 pence per share.
On 22 June 2021, the company announced it had extended 2 loan
agreements. GBP100k had been extended to 31 December 2021, and
GBP100k has been extended to 30 June 2022. 4,705,882 new warrants
were issued in respect of the loan extension.
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHSED 30 JUNE 2021
Unaudited Unaudited
6 months 6 months Audited
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
Notes GBP'000 GBP'000 GBP'000
Continuing operations
Revenue 785 - 799
(1,124
Operating costs ) - (1,423)
Administrative expenses (1,173) (938) (2,616)
Impairment of investment - (4,628)
Consultancy fee income - 353
Operating loss (1,512) (938) (7,515)
Movement in fair value of investments - - 678
Finance costs (25) (37) (67)
Loss on ordinary activities
before taxation (1,537) (975) (6,904)
Taxation - - -
Loss for the period (1,537) (975) (6,904)
--------------------------------------- ----------------- ------------- ------------ -------------
Other Comprehensive income:
Exchange translation movement (62) 529 (233)
--------------------------------------- ----------------- ------------- ------------ -------------
Total comprehensive loss for
the period (1,599) (446) (7,137)
--------------------------------------- ----------------- ------------- ------------ -------------
Basic and diluted loss per
share 2
From continuing and total operations (1.1)p (1.5)p (8.7)p
--------------------------------------- ----------------- ------------- ------------ -------------
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHSED 30 JUNE 2021
Exchange
Share translation Retained Total
capital Share premium reserve Other reserves deficit equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- ---------- ------------- ------------ -------------- -------- -------
At 1 January 2020 8,817 34,012 (617) 870 (28,152) 14,930
Loss for the year - - - - (6,904) (6,904)
Exchange translation
movement - - (233) - - (233)
--------------------- ---------- ------------- ------------ -------------- -------- -------
Total comprehensive
expense for the
year - - (233) - (6,904) (7,137)
Issue of new shares 633 2,544 - (134) - 3,043
Share issue costs - (21) - - - (21)
Issue of convertible
loans - - - 17 - 17
Warrants issued
in settlement of
fees - - - 170 - 170
Warrants exercised - 56 - (106) 50 -
At 31 December 2020 9,450 36,591 (850) 817 (35,006) 11,002
Loss for the period - - - - (1,537) (1,537)
--------------------- ---------- ------------- ------------ -------------- -------- -------
Exchange translation
movement - - (62) - - (62)
--------------------- ---------- ------------- ------------ -------------- -------- -------
Total comprehensive
expense for the
period - - (62) - (1,537) (1,599)
--------------------- ---------- ------------- ------------ -------------- -------- -------
Issue of new shares 348 1,283 - - - 1,631
Share issue costs - (43) - - - (43)
Issue of warrants - (9) - 65 - 56
At 30 June 2021 9,798 37,822 (912) 882 (36,543) 11,047
--------------------- ---------- ------------- ------------ -------------- -------- -------
UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2021
Unaudited Unaudited Audited
30 June 30 June 31 December
Notes 2021 2020 2020
GBP'000 GBP'000 GBP'000
--------------------------------------- ------- -------------- -------------- -------------
NON-CURRENT ASSETS
Intangible assets 16,430 16,212 16,007
16,430 16,212 16,007
--------------------------------------- ------- -------------- -------------- -------------
CURRENT ASSETS
Investments held for trading 28 200 878
Inventory 104 740 32
Trade and other receivables 137 337 109
Cash and cash equivalents 137 52 30
--------------------------------------- ------- -------------- -------------- -------------
406 1,329 1,049
--------------------------------------- ------- -------------- -------------- -------------
CURRENT LIABILITIES
Trade and other payables 3 4,123 2,761 4,206
Borrowings 3 195 - 235
4,318 2,761 4,441
--------------------------------------- ------- -------------- -------------- -------------
NET CURRENT LIABILITIES (3,912) (1,432) (3,392)
NON-CURRENT LIABILITIES
Convertible loans 398 - 284
Other borrowings - - 297
Decommissioning provision 1,073 - 1,032
--------------------------------------- ------- -------------- -------------- -------------
1,471 - 1,613
--------------------------------------- ------- -------------- -------------- -------------
NET ASSETS 11,047 14,780 11,002
--------------------------------------- ------- -------------- -------------- -------------
EQUITY
Ordinary share capital 9,798 8,965 9,450
Share premium 37,822 34,310 36,591
Other reserves 882 720 (35,006)
Currency translation reserve (912) (88) 9,450
--------------------------------------- ------- -------------- -------------- -------------
Retained deficit (36,543) (29,127) 36,591
--------------------------------------- ------- -------------- -------------- -------------
Equity attributable to owners of
the Company and total equity 11,047 14,780 11,002
--------------------------------------- ------- -------------- -------------- -------------
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2021
Unaudited Unaudited
6 months 6 months Audited
ended ended Year ended
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
-------------------------------------------- ---------- ---------- -------------
OPERATING ACTIVITIES
Loss for the period (1,537) (975) (6,904)
Adjustments for:
Fair value adjustment to investments - - (678)
Warrants issued in settlement of
fees 56 - 170
Finance costs 25 37 67
Impairment of intangible assets - - 4,628
Decommissioning charge 51 - -
Depreciation and amortisation 48 43 85
Operating cashflow before working
capital changes (1,357) (895) (2,632)
(Increase) in inventories (72) (740) (32)
(Increase)/decrease in receivables (28) 177 303
Increase/(decrease) in trade and
other payables 324 999 1,410
--------------------------------------------- ---------- ---------- -------------
Net cash outflow from operating activities (1,133) (459) (951)
--------------------------------------------- ---------- ---------- -------------
INVESTMENT ACTIVITIES
Proceeds on disposal of investments 850 - -
Purchase of investments - - -
Development costs (180) - (181)
Net cash outflow from investment
activities 670 - (181)
--------------------------------------------- ---------- ---------- -------------
FINANCING ACTIVITIES
Issue of ordinary share capital 932 352 848
Share issue costs (43) (8) (21)
Proceeds from short term loans - 170 278
Repayment of borrowings (352) 170 278
Net cash inflow from financing activities 537 514 1,105
--------------------------------------------- ---------- ---------- -------------
Net increase/(decrease) in cash and
cash equivalents from continuing
and total operations 74 55 (27)
Exchange translation difference 33 (18) 42
Cash and cash equivalents at beginning
of period 30 15 15
C ash and cash equivalents at end
of period 137 52 30
--------------------------------------------- ---------- ---------- -------------
NOTES TO THE HALF-YEARLY REPORT
1. The financial information set out in this interim report does
not constitute statutory accounts as defined in section 434 of the
Companies Act 2006. The group's statutory financial statements for
the period ended 31 December 2020, prepared under International
Financial Reporting Standards (IFRS), have been filed with the
Registrar of Companies. The auditor's report on those financial
statements was unqualified and did not contain a statement under
section 498 (2) or (3) of the Companies Act 2006.
The interim financial information has been prepared in
accordance with the recognition and measurement principles of
International Financial Reporting Standards (IFRS) and on the same
basis and using the same accounting policies as used in the
financial statements for the year ended 31 December 2019. The
interim financial statements have not been audited or reviewed in
accordance with the International Standard on Review Engagement
2410 issued by the Auditing Practices Board.
Going concern
At 30 June 2021, the Group recorded a loss for the period of
GBP1,599,000 and had net current liabilities of GBP4,318,000 after
allowing for cash balances of GBP137,000.
The Directors have prepared cashflow forecasts for the period to
30 September 2022 to assess whether the use of the going concern
basis for the preparation of the financial statements is
appropriate. In the short term, the Group will require further
additional funding in order to meet its liabilities as they fall
due and continue to operate as a going concern. The Directors have
taken into consideration the level and timing of the Group's
working capital requirements (which takes into account recent
reductions in costs and control of discretionary spending to
preserve cash flow) and has also considered the likelihood of
successfully securing funding to meet these needs. In particular,
consideration has been given to ongoing discussions around further
third-party investment and the extent to which these discussions
are advanced both in respect of short and longer term funding. The
Directors acknowledge that while they have an expectation that
funding will be secured based on this assessment, at the date of
approval of these financial statements, no such funding has been
unconditionally committed. Therefore, while the Directors have a
reasonable expectation that the Group has the ability to raise the
additional finance required in order to continue in operational
existence for the foreseeable future, the uncertainty surrounding
the ability and likely timing of securing such finance indicates
that a material uncertainty exists that may cast significant doubt
on the Group's ability to continue as a going concern. Were no such
funding to be secured, the Group would have no realistic
alternative but to halt operations and prepare its financial
statements on a non-going concern basis.
2. Earnings per share
The basic loss per share is calculated by dividing the loss
attributable to equity shareholders by the weighted average number
of shares in issue.
Six months Six months Year ended
ended ended
30 June 30 June 31 December
2021 2020 2020
(unaudited) (unaudited) (audited)
------------------------------------------- -------------------- ----------------------- --------------------
Weighted average number of
shares in the period 140,486,609 65,616,001 79,594,655
------------------------------------------- -------------------- ----------------------- --------------------
Loss from continuing and total
operations (GBP1,537,000) (GBP975,000) (GBP6,904,000)
Basic and diluted loss per
share:
From continuing and total operations (1.1)p (1.5)p (8.7)p
3. No interim dividend will be paid.
4. Copies of the interim report can be obtained from: The
Company Secretary, ADM Energy plc, 60,Gracechurch Street, London,
EC3V 0HR and are available to view and download from the Company's
website: www.admenergyplc.com.
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END
IR EASNEDDAFEFA
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