TIDMAST

RNS Number : 1868L

Ascent Resources PLC

09 September 2021

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION

9 September 2021

Ascent Resources plc

("Ascent" or "the Company")

Interim results for the period ended 30 June 2021

Ascent Resources plc (LON:AST), the AIM quoted onshore Caribbean, Hispanic American and European energy and natural resources focussed company ("Company") is pleased to report its interim results for the six months ended 30 June 2021.

Highlights:

-- Launch of ESG Metals Strategy as a new target sector within its natural resource focussed business with maiden deal expected in H2 2021.

-- Signing of a non-binding head of terms with Enyo Law LLP, a specialist arbitration and litigation legal firm, to advance a fully funded non-recourse damages-based agreement for the arbitration proceedings against the Republic of Slovenia.

-- Raised GBP1m before expenses by way of an oversubscribed subscription and placement with existing and new investors.

Enquiries:

 
 Ascent Resources plc              Via Vigo Consulting 
  Andrew Dennan, CEO 
 WH Ireland, Nominated Adviser 
  & Broker 
  James Joyce / Sarah Mather       0207 220 1666 
 Novum Securities, Joint Broker 
  John Belliss                     0207 399 9400 
 

Chairman and CEO's statement

Despite the continuing global pandemic, Ascent has advanced across multiple fronts following the restructuring of its Board, strategy, and portfolio last year. The business's new strategic platform is now taking shape, with the opportunities that brings.

First, the Company has made a significant step forward in securing funding for its international arbitration proceedings against the Republic of Slovenia with the signature of non-binding heads of terms with Enyo Law LLP. These heads define the terms under which the specialist arbitration and litigation legal firm shall represent the Company on a fully contingent basis through a damages-based agreement for the pursuit of the claim in arbitration in relation to breaches of relevant investment treaties arising out of and in connection with the Notice of Dispute sent on 23 July 2020. The Company is currently negotiating final binding documentation for this funding.

Secondly, the Company broadened its strategy to include the ESG Metals asset class and is now in the process of originating and negotiating its maiden transaction. The Directors believe this is a new exciting and burgeoning target sector to grow the Company.

Slovenia

As announced in March, the Company is advancing towards initiating international arbitration proceedings against the Republic of Slovenia under the Energy Charter Treaty and UK-Slovenia Bilateral Investment Treaty. In June, the Company announced that it had signed a non-binding, heads of terms with Enyo Law LLP, a specialist arbitration and litigation legal firm (the "Firm"). This agreement intends to engage the Firm to pursue the Company's claims on a success-only fee arrangement. Upon completion of definitive documentation, the Firm will only be paid out of the proceeds of the arbitration in the event of a successful damages award or execution of a binding settlement agreement if achieved sooner. This non-equity dilutive, non-recourse and full funding proposal is the preferred solution from the Company's perspective, notwithstanding that the Company has other alternative offers also under discussion.

Operations at the Petišovci project continue to produce gas , albeit at lower levels as a result of the field performance decline and current inability to re-stimulate the producing PG-10 and PG-11A wells. Total production f or the six months to 30 June 2021 was 751.14 thousand cubic metres of gas and 33,512 litres of condensate. Gas sales continue with production being sold to local industrial buyers. The region is currently experiencing very high gas prices with the average Day Ahead Market gas price being Eur 51.0 / MWh as at 1 September, 2021. The JV expects to continue producing, thereby taking advantage of strong current prices.

ESG Metals Strategy

As announced in February, the Company has broadened its natural resources mandate to include a focus on ESG Metals, which it sees as a new and burgeoning target sector to grow the Company. ESG Metals includes secondary mining and re-treatment and recovery opportunities which the Company sees as being consistent with Environmental, Social and Governance ("ESG") principles. Typically, these involve the reclassification, through highly efficient recovery techniques, of stockpiled surface mining waste (previously viewed as a liability for mining companies) as a valuable asset for reprocessing and commercial sale to industry, governments and metals traders.

The Company sees waste management, remediation and restoration of land impacted by historic and ongoing mining activities as a critical element in the global ESG agenda and integral to the transition to a low carbon economy. The Company is looking at a number of potential projects in Hispanic and Latin Americas, the Caribbean, and South Africa, as well as Europe. In particular, the Company believes there are good opportunities in gold, silver, platinum, base metals and ferrochrome, where the economics are especially attractive and the opportunity set has the ability of delivering lowest cost quartile sustainable metal production from legacy mining tailings, with low geological risk. Such opportunities have the potential to provide strong cash returns without exploration risk and only require modest upfront capital outlay.

Cuba Market Entry

The Company continues to retain optionality to enter the Cuban Oil and Gas industry, once COVID 19 restrictions are lifted and possibly after the outcome of recent civil unrest is clarified. As announced in August last year, the Company transmitted the draft documentation in relation to its operating credentials to Union Cuba-Petroleo ("CUPET"), Cuba's national oil company, and the Oficina Nacional de Recursos Minerales ("ORNM") and since then has received positive initial feedback towards accreditation as an onshore operator subject to funding.

Corporate

During the period in review the Company raised GBP1 million at an issue price of 10.1 pence per share by way of an oversubscribed subscription and placing of new shares to institutional investors and existing shareholders to fund the Company's general working capital and ESG Metals business development activity.

Outlook

The team continue to work diligently across our key corporate priorities which include funding the Slovenia ECT claim and delivering a maiden ESG metals transaction. We look forward to delivering success for our shareholders at Ascent Resources plc and to re-engaging face to face with them now that COVID restrictions in Europe have eased.

   James Parsons                                                                      Andrew Dennan 

Executive Chairman Chief Executive Officer

   8 September 2021                                                              8 September 2021 

CEO's report

Financial performance

Revenue for the first six month of 2021 was GBPnil, as per the prior period. Closing cash at 30 June 2021 was GBP766,000 compared to GBP304,000 in the prior period.

During the period the Company raised GBP1m before costs in an equity placing in February 2021. There was a cash outflow from operations of GBP824,000 and an inflow of GBP1,475,000 from financing, resulting in net cash flow of GBP651,000.

Operational performance

 
 Production KPI's             Jan 2021   Feb 2021   Mar 2021    Apr 2021   May 2021   Jun 2021 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 Total gas (k scm)              131.82     136.17      155.10     143.08      99.17      85.80 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 Total gas (MMcf)                 4.66       4.81        5.48       5.05       3.50       3.03 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 Average daily gas 
  (k scm)                         4.25       4.86        5.00       4.77       3.20       2.86 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 Average daily gas 
  (Mcf)                         150.17     171.74      176.69     168.43     112.97     101.00 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 Total condensate (liters)    2,808.00   2,354.00   17,496.00   5,346.00   3,834.00   1,674.00 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 CGR (liters per 1000 
  scm gas)                       21.30      17.29      112.80      37.36      38.66      19.51 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 BOE - gas                      802.39     828.87      944.09     870.93     603.65     522.26 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 BOE - condensate                17.63      14.78      109.87      33.57      24.08      10.51 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 Total BOE                      820.02     843.65     1053.97     904.50     627.73     532.78 
---------------------------  ---------  ---------  ----------  ---------  ---------  --------- 
 

Total production for the six months to 30 June 2021 was 751.14 thousand cubic metres of gas and 33,512 litres of condensate.

Gas sales to INA remain suspended as wellhead pressure is below the export pipeline pressure. The sales contract remains valid and should the Company increase production gas sales may be able to be resumed. The Company produced gas in the year to date which was sold locally to an industrial buyer through a low-pressure pipeline, however the revenue from this is less than the fixed costs of the field and pursuant to a deal agreed in Q4 2019 the Company is not currently receiving any revenue from this declining production, with the proceeds being retained by the operating service provider to pay towards their fixed costs.

Consolidated Income Statement

for the Period ended 30 June 2021

 
                                                    Period ended      Period ended 
                                                         30 June           30 June 
                                                            2021              2020 
                                         Notes         GBP '000s         GBP '000s 
 
 Revenue                                                       -                 - 
 Cost of sales                                              (25)              (59) 
 Depreciation of oil & gas assets                          (194)             (230) 
                                                ----------------  ---------------- 
 Gross profit                                              (219)             (289) 
 
 Administrative expenses                                   (826)             (945) 
                                                ----------------  ---------------- 
 Loss from operating activities                          (1,045)           (1,234) 
 
 Finance income                                                -                 - 
 Finance cost                                               (10)               (9) 
                                                ----------------  ---------------- 
 Net finance costs                                          (10)               (9) 
 
 Loss before taxation                      2             (1,055)           (1,243) 
 
 Income tax expense                                            -                 - 
                                                ----------------  ---------------- 
 Loss for the period after tax                           (1,055)           (1,243) 
 
 Loss for the period attributable to 
  equity shareholders                                    (1,055)           (1,243) 
 
 Earnings per share 
 Basic & fully diluted loss per share 
  (GBP)                                    4              (0.01)            (0.03) 
 

Consolidated Statement of Comprehensive Income

for the Period ended 30 June 2021

 
                                              Period ended   Period ended 
                                                   30 June        30 June 
                                                      2021           2020 
                                                 GBP '000s      GBP '000s 
 
 Loss for the period                               (1,055)        (1,243) 
 
 Other comprehensive income 
 
 Foreign currency translation differences 
  for foreign operations                             (776)          1,835 
 
 Total comprehensive gain / (loss) for the 
  period                                           (1,831)            592 
 

Consolidated Statement of Changes in Equity

for the Period ended 30 June 2021

 
                        Share          Share      Merger      Equity       Share   Translation    Retained       Total 
                      capital        premium     Reserve     reserve       based       reserve    earnings 
                                                                         payment 
                                                                         reserve 
                    GBP '000s      GBP '000s   GBP '000s   GBP '000s   GBP '000s     GBP '000s   GBP '000s   GBP '000s 
 Balance at 1 
  January 2020          7,604         72,330         570           -       1,873         (300)    (41,964)      40,113 
 Comprehensive                                                                                                       - 
 income 
 Loss for the 
  period                    -              -           -           -           -             -     (1,243)     (1,243) 
 Other 
 comprehensive 
 income 
 Currency 
  translation 
  differences               -              -           -           -           -         1,835           -       1,835 
 Total 
  comprehensive 
  income                    -              -           -           -           -         1,835     (1,243)         592 
 Transactions 
 with owners 
 Issue of 
  shares during 
  the 
  year net of 
  costs                   113            678           -           -           -             -           -         791 
 Issue of 
  shares on 
  acquisition              30            173           -           -           -             -           -         203 
 Share-based 
  payments and 
  expiry of 
  options                   -              -           -           -         206             -           -         206 
 Balance at 30 
  June 2020             7,747         73,181         570           -       2,079         1,535    (43,207)      41,905 
---------------  ------------  -------------  ----------  ----------  ----------  ------------  ----------  ---------- 
 Balance at 1 
  January 2020          7,604         72,330         570           -       1,873         (300)    (41,964)      40,113 
 Comprehensive                                                                                                       - 
 income 
 Loss for the 
  period                    -              -           -           -           -             -     (2,831)     (2,831) 
 Other 
 comprehensive 
 income 
 Currency 
  translation 
  differences               -              -           -           -           -         1,327           -       1,327 
 Total 
  comprehensive 
  income                    -              -           -           -           -         1,327     (2,831)     (1,504) 
 Transactions 
 with owners 
 Issue of 
  ordinary 
  shares                  324          1,713           -           -           -             -           -       2,037 
 Costs related 
  to share 
  issues                    -          (180)           -           -           -             -           -       (180) 
 Equity value 
  of 
  convertible 
  loan note                 -              -           -          73           -             -           -          73 
 Share based 
  payments                  -              -           -           -         256             -         200         456 
 Balance at 31 
  December 2020         7,928         73,863         570          73       2,129         1,027    (44,595)      40,995 
---------------  ------------  -------------  ----------  ----------  ----------  ------------  ----------  ---------- 
 Balance at 1 
  January 2021          7,928         73,863         570          73       2,129         1,027    (44,595)      40,995 
 Comprehensive                                                                                                       - 
 income 
 Loss for the 
  period                    -              -           -           -           -             -     (1,055)     (1,055) 
 Other 
 comprehensive 
 income 
 Currency 
  translation 
  differences               -              -           -           -           -         (776)           -       (776) 
 Total 
  comprehensive 
  income                    -              -           -           -           -         (776)     (1,055)     (1,831) 
 Transactions                                                                                                        - 
 with owners 
 Issue of 
  shares during 
  the 
  year net of 
  costs                    70          1,176           -           -           -             -           -       1,246 
 Share-based 
  payments                  -              -           -           -          16             -           -          16 
 Balance at 30 
  June 2021             7,998         75,039         570          73       2,145           251    (45,650)      40,424 
---------------  ------------  -------------  ----------  ----------  ----------  ------------  ----------  ---------- 
 

Consolidated Statement of Financial Position

As at 30 June 2021

 
                                                                30 June     31 December 
                                                                   2021            2020 
 Assets                                           Notes       GBP '000s       GBP '000s 
 Non-current assets 
 Property, plant and equipment                      5            21,865          22,783 
 Exploration and evaluation costs                   5            18,604         18,5763 
 Goodwill                                                           653             653 
 Prepaid abandonment fund                                           300             300 
                                                         --------------  -------------- 
 Total non-current assets                                        41,422          42,489 
 Current assets 
 Inventory                                                            -               - 
 Trade and other receivables                        6               119              66 
 Cash and cash equivalents                                          766             115 
 Restricted cash                                                      -               - 
                                                         --------------  -------------- 
 Total current assets                                               885             181 
 Total assets                                                    42,307          42,670 
                                                         ==============  ============== 
 
 Equity and liabilities 
 Attributable to the equity holders 
  of the Parent Company 
 Share capital                                     10             7,998           7,928 
 Share premium account                                           75,039          73,863 
 Merger reserve                                                     570             570 
 Equity reserve                                                      73              73 
 Share-based payment reserve                                      2,145           2,129 
 Translation reserves                                               251           1,027 
 Retained earnings                                             (45,650)        (44,595) 
                                                         --------------  -------------- 
 Total equity attributable to the shareholders                   40,424          40,995 
 
 Total equity                                                    40,424          40,995 
                                                         --------------  -------------- 
 
 Non-current liabilities 
 Borrowings                                         8               505             197 
 Provisions                                                         317             328 
 Total non-current liabilities                                      822             525 
 Current liabilities 
 Borrowings                                         8                 5               5 
 Contingent consideration due on acquisitions       9               450             450 
 Trade and other payables                           7               606             695 
 Total current liabilities                                        1,061           1,150 
 Total liabilities                                                1,883           1,675 
                                                         --------------  -------------- 
 Total equity and liabilities                                    42,307          42,670 
                                                         ==============  ============== 
 

Consolidated Statement of Cash Flows

for the six months ended 30 June 2021

 
                                               Period ended       Period ended 
                                                    30 June            30 June 
                                                       2021               2020 
                                                  GBP '000s          GBP '000s 
 Cash flows from operations 
 Loss after tax for the period                      (1,055)            (1,243) 
 Depreciation                                           194                231 
 Change in receivables                                   53                170 
 Change in payables                                    (89)                 80 
 Increase in share-based payments                        38                206 
 Exchange differences                                    25                 11 
 Finance cost                                            10                  9 
 Net cash used in operating activities                (824)              (536) 
                                             --------------  ----------------- 
 
 Cash flows from investing activities 
 Payments for fixed assets                                -                (3) 
 Payments for investing in exploration                    -                  - 
 Net cash used in investing activities                    -                (3) 
                                             --------------  ----------------- 
 
 Cash flows from financing activities 
 Interest paid and other finance fees                     -                  - 
 Loans repaid                                         (125)               (12) 
 Proceeds from borrowings                               375 
 Proceeds from issue of shares                        1,265                848 
 Share issue costs                                     (40)               (70) 
 Net cash generated from financing 
  activities                                          1,475                736 
                                             --------------  ----------------- 
 
 Net increase in cash and cash equivalents 
  for the year                                          651                227 
 Effect of foreign exchange differences                   -                  - 
 Cash and cash equivalents at beginning 
  of the year                                           115                 77 
 Cash and cash equivalents at end of 
  the year                                              766                304 
                                             ==============  ================= 
 

Notes to the Interim Financial Statements

For the six months ended 30 June 2021

   1.    Accounting Policies 

Reporting entity

Ascent Resources plc ('the Company') is a company domiciled in England. The address of the Company's registered office is 5 New Street Square, London EC4A 3TW. The unaudited consolidated interim financial statements of the Company as at 30 June 2021 comprise the Company and its subsidiaries (together referred to as the 'Group').

Basis of preparation

The interim financial statements have been prepared using measurement and recognition criteria based on International Financial Reporting Standards (IFRS and IFRIC interpretations) issued by the International Accounting Standards Board (IASB) as adopted for use in the EU. The interim financial information has been prepared using the accounting policies which were applied in the Group's statutory financial statements for the year ended 31 December 2020.

New Standards adopted as at 1 January 2021

Accounting pronouncements which have become effective from 1 January 2021 are:

   --      IFRS 3 Business Combinations - definition of a business 
   --      IAS 1 and IAS 8 - definition of material 
   --      IFRS 9, IFRS 7 and IAS 39 - interest rate benchmark 
   --      IFRS 7 - Insurance contracts 

These accounting pronouncements do not have a significant impact on the Group's financial results or position.

All amounts have been prepared in British pounds, this being the Group's presentational currency.

The interim financial information for the six months to 30 June 2021 and 30 June 2020 is unaudited and does not constitute statutory financial information. The comparatives for the full year ended 31 December 2020 are not the Group's full statutory accounts for that year. The information given for the year ended 31 December 2020 does not constitute statutory financial statements as defined by Section 435 of the Companies Act. The statutory accounts for the year ended 31 December 2019 have been filed with the Registrar and are available on the Company's web site www.ascentresources.co.uk . The auditors' report on those accounts was unqualified. It did not contain a statement under Section 498(2)-(3) of the Companies Act 2006.

Going Concern

The Financial Statements of the Group are prepared on a going concern basis.

COVID-19 has had limited direct impact on Ascent's assets in Slovenia but there may be delays in obtaining the necessary governmental approvals and processes. Production operations in Slovenia have been unaffected to date.

The forecasts are sensitive to the timing and cash flows associated with the continuing situation in Slovenia, and discretionary spend incurred with executing on the ESG Metals Strategy through acquisition and advancing the Cuban initiative, including deferred consideration that would become payable if the Company elects to enter a PSC for Block 9b. As such, the Company will need to raise new capital within the forecast period to fund such discretionary spend.

Based on historical and recent support from new and existing investors the Board believes that such funding, if and when required, could be obtained through new debt or equity issuances.

However, there can be no guarantee over the outcome of these options and as a consequence there is a material uncertainty of the Group's ability to raise the necessary finance, which may cast doubt on the Group's ability to operate as a going concern. Further, the Group may be unable to realise its assets and discharge its liabilities in the normal course of business.

Principal Risks and Uncertainties:

The principal risks and uncertainties affecting the business activities of the Group remain those detailed on pages 11-12 of the Annual Review 2020, a copy of which is available on the Company's website at www.ascentresources.co.uk.

   2.    Operating loss is stated after charging 
 
                                          Period ended   Period ended 
                                               30 June        30 June 
                                                  2021           2020 
                                             GBP '000s      GBP '000s 
 Employee costs                                    475            241 
 Share based payment charge                         16            206 
 
 
 Included within Admin Expenses 
 Audit Fees                                         40             35 
 Fees payable to the company's auditor               -              - 
  other services 
                                         -------------  ------------- 
                                                    40             35 
 
   3.    Earnings per share 
 
                                                    Period ended          Period ended 
                                                         30 June               30 June 
                                                            2021                  2020 
                                                       GBP '000s             GBP '000s 
 Result for the period 
 Total loss for the period attributable 
  to equity shareholders                                 (1,055)               (1,243) 
 
 Weighted average number of ordinary                      Number                Number 
  shares 
 For basic earnings per share                        106,483,897            42,776,190 
 
 Earnings per share (GBP)                                 (0.01)                (0.03) 
 
   4.    Property, plant & equipment and Exploration and Evaluation assets 
 
                                        Computer    Developed   Total Property     Exploration 
                                       Equipment    Oil & Gas          Plant &    & evaluation 
                                                       Assets        Equipment 
 Cost                                    GBP000s      GBP000s          GBP000s         GBP000s 
 At 1 January 2020                             6       23,483           23,489          18,576 
 Additions                                     4            -                -             653 
 Effect of exchange rate movements             -        1,592            1,592             216 
 At 30 June 2020                              10       25,075           25,085          19,445 
                                     -----------  -----------  ---------------  -------------- 
 At 1 January 2020                             6       23,483           23,489          18,576 
 Additions                                     -            3                3               - 
 Effect of exchange rate movements             -        1,111            1,111             177 
 At 31 December 2020                           6       24,494           24,600          18,753 
                                     -----------  -----------  ---------------  -------------- 
 At 1 January 2020                             6       24,494           24,600          18,753 
 Additions                                     -            -                -               - 
 Effect of exchange rate movements             -        (624)            (624)           (149) 
 At 30 June 2021                               6       23,870           23,876          18,604 
                                     -----------  -----------  ---------------  -------------- 
 
 
 Depreciation 
 At 1 January 2020                           (6)      (1,414)          (1,420)               - 
 Charge for the year                         (1)        (231)            (232)               - 
 Effect of exchange rate movements             -           55               55               - 
 At 30 June 2020                             (7)     (1,618),          (1,625)               - 
                                     -----------  -----------  ---------------  -------------- 
 At 1 January 2020                           (6)      (1,414)          (1,420)               - 
 Charge for the year                           -        (397)            (397)               - 
 Effect of exchange rate movements             -            -                -               - 
 At 31 December 2020                         (6)      (1,811)          (1,817)               - 
                                     -----------  -----------  ---------------  -------------- 
 At 1 January 2021                           (6)      (1,811)          (1,817)               - 
 Charge for the year                           -        (194)            (194)               - 
 Effect of exchange rate movements             -            -                -               - 
 At 30 June 2021                             (6)      (2,005)          (2,011)               - 
                                     -----------  -----------  ---------------  -------------- 
 
 Carrying value 
 At 30 June 2021                               -       21,865           21,865          18,604 
                                     -----------  -----------  ---------------  -------------- 
 At 31 December 2020                           -       22,973           22,873          18,753 
                                     -----------  -----------  ---------------  -------------- 
 At 30 June 2020                               4       23,457           23,460          19,445 
                                     -----------  -----------  ---------------  -------------- 
 
   5.    Trade & other receivables 
 
                                    30 June   31 December 
                                       2021          2020 
                                  GBP '000s     GBP '000s 
 Trade receivables                        -             - 
 VAT recoverable                         53            49 
 Prepaid abandonment liability          300           300 
 Prepayments & accrued income             9            17 
                                        362           366 
                                 ==========  ============ 
 Less non-current portion             (300)         (300) 
                                 ----------  ------------ 
 Current portion                         62            66 
 
   6.    Trade & other payables 
 
                                      30 June   31 December 
                                         2021          2020 
                                    GBP '000s     GBP '000s 
 Trade payables                           538           573 
 Tax and social security payable           68            56 
 Other payables                             -             - 
 Accruals and deferred income              66            66 
                                          606           695 
                                   ==========  ============ 
 
   7.    Borrowings 
 
                                         30 June   31 December 
                                            2021          2020 
 Group                                 GBP '000s     GBP '000s 
 Non-current 
 Convertible loan notes                      505           197 
                                              55           197 
                                      ----------  ------------ 
 
                                         30 June   31 December 
 Group                                      2021          2019 
  Curren t                             GBP '000s     GBP '000s 
 
 Convertible loan notes                        5             5 
 Borrowings                                    -             - 
 Liability at the end of the period            5             5 
                                      ----------  ------------ 
 

The non-current borrowings relate to the loan arrangement with Riverfort Global opportunities that was refinanced in February 2020. The outstanding loan of GBP375,020 as at February 2020 was re-negotiated to a two-year coupon free bullet with conversion rights for the lender at 7.5 pence per share. No conversion can occur until the share price exceeds 10 pence per share for five consecutive days. The Group made convertible loan note repayments in the year of GBP105,000 to Riverfort Global opportunities, resulting in an ending convertible loan note balance of GBP270,000, comprising GBP197,000 recognised as the debt component and a further GBP73,000 recognised in Equity Reserve.

The current borrowings relate to the loan facility arrangement with Align Research. The outstanding loan of GBP307,500, of which GBP57,500 was received subsequent to the period end.

   8.    Contingent consideration due on acquisitions 
 
                                           30 June   31 December 
                                              2021          2020 
 Group                                   GBP '000s     GBP '000s 
 Non-current 
 Ascent Hispanic Resources UK Limited          450           450 
                                               450           450 
                                        ----------  ------------ 
 
 

The fair value of contingent consideration was based on the present value of cash flows and the market value of the shares to be issued.

   9.    Share Capital 
 
                                                     30 June             31 December 
                                                        2021                    2020 
                                                   GBP '000s               GBP '000s 
 Authorised 
 2,000,000,000 ordinary shares of 0.5p 
  each                                                10,000                  10,000 
 
 Allotted, called up and fully paid 
 3,019,648,452 deferred shares of 0.195p 
  each                                                 5,888                   5,888 
 1,737,110,763 deferred shares of 0.09p 
  each                                                 1,563                   1,563 
 109,376,804 ordinary shares of 0.5p 
  each (2020: 95,283,281 ordinary shares 
  of 0.2p each)                                          547                     477 
                                                       7,998                   7,928 
 Reconciliation of share capital movement    Ordinary shares     Ordinary shares No. 
                                                         No. 
 Opening                                          95,283,281           3,019,648,452 
 Share consolidation                                       -         (2,989,451,968) 
  Issue of Trameta consideration shares                                       91,167 
 Issue of shares during the year                  14,093,523              64,995,630 
 Closing                                         109,376,804            95,283,281 
                                            ================  ==================== 
 
 

The deferred shares have no voting rights and are not eligible for dividends.

Shares issued during the year

Issuance of equity throughout the year:

-- On 6 January 2021, the Company issued 208,991 ordinary shares ('Consultancy Shares'), to a supplier for financial modelling and business development services rendered in the months of November and December, at an average issue price of 5.74 pence per share being calculated as the monthly volume weighted average price calculations for the respective months in which the services were rendered.

-- On 11 January 2021, the Company received a Warrant Exercise notice over 833,333 new ordinary shares for a consideration of GBP62,500. The Warrants are being exercised by Align Research in consideration for surrendering an equivalent value of loan notes. Additionally, the Company has agreed to issue 66,667 new shares at 7.5 pence, being the coupon conversion price, in lieu of the 8% cash coupon that is incurred on the converted loan amount.

-- On 4 February 2021, the Company received a warrant exercise notice over 1,000,000 new ordinary shares for a consideration of GBP55,000.

-- On 4 February 2021, the Company received a Warrant Exercise notice over 833,333 new ordinary shares for a consideration of GBP62,500. The Warrants are being exercised by Align Research in consideration for surrendering an equivalent value of loan notes. Additionally, the Company has agreed to issue 66,667 new shares at 7.5 pence, being the coupon conversion price, in lieu of the 8% cash coupon that is incurred on the converted loan amount.,

-- On 4 February 2021, the Company received a Warrant Exercise notice over 900,000 new ordinary shares for a consideration of GBP67,500. The Warrants are being exercised by Align Research and the Company has therefore today issued 900,000 new shares.

-- On 10 February 2021, the Company received a warrant exercise notice over 187,500 new ordinary shares for a consideration of GBP7,500.

-- On 11 February 2021, the Company issued 9,997,032 new ordinary shares of 0.5p at a price of 10.1p through an oversubscribed placing, raising gross proceeds of GBP1,009,700.

10. Share based payments

The Company has provided the Directors, certain employees and institutional investors with share options and warrants ('options'). Options are exercisable at a price equal to the closing market price of the Company's shares on the date of grant. The exercisable period varies and can be up to seven years once fully vested after which time the option lapses.

Details of the share options outstanding during the year are as follows:

 
                                             Shares   Weighted Average 
                                                         price (pence) 
 Outstanding at 1 January 2020          152,576,254               2.38 
 Outstanding at 31 December 2020          7,348,142             253.72 
 Exercisable at 31 December 2020          1,450,763             248.72 
 
 Outstanding at 1 January 2021            7,348,142             253.72 
 Granted during the year                          -                  - 
 Outstanding at 30 June 2021              7,348,142             253.72 
 Exercisable at 30 June 2021              1,450,763             248.72 
 

The value of the options is measured by the use of a binomial pricing model. The inputs into the binomial model made in 2020 were as follows.

 
 Share price at grant date     2.9p - 778p 
 Exercise price               5.0p - 2000p 
 Volatility                            50% 
 Expected life                   3-5 years 
 Risk free rate                       0.5% 
 Expected dividend yield                0% 
 

Expected volatility was determined by calculating the historical volatility of the Group's share price over the previous 5 years. The expected life is the expiry period of the options from the date of issue.

Options outstanding at June 2020 have an exercise price in the range of 2.9p and 778p (and a weighted average contractual life of 4.5 years.

Details of the warrants outstanding during the year are as follows:

 
                                          Shares   Weighted Average 
                                                      price (pence) 
 Outstanding at 1 January 2021        22,068,420               5.44 
 Granted during the year                       -                  - 
 Exercised during the year           (3,754,166)               6.79 
 Outstanding at 30 June 2021          18,314,254               5.44 
 Exercisable at 30 June 2021          17,889,772               5.45 
 

11. Events after the reporting period

There have been no significant events subsequent to the reporting period.

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 or visit 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.

END

IR BRGDCUUGDGBI

(END) Dow Jones Newswires

September 09, 2021 02:00 ET (06:00 GMT)

Ascent Resources (LSE:AST)
Historical Stock Chart
From Jun 2022 to Jul 2022 Click Here for more Ascent Resources Charts.
Ascent Resources (LSE:AST)
Historical Stock Chart
From Jul 2021 to Jul 2022 Click Here for more Ascent Resources Charts.