TIDMKIBO
RNS Number : 8433A
Kibo Energy PLC
14 September 2018
Kibo Energy PLC (Incorporated in Ireland)
(Registration Number: 451931)
(External registration number: 2011/007371/10) Share code on the
JSE Limited: KBO
Share code on the AIM: KIBO ISIN: IE00B97C0C31
("Kibo" or "the Group" or "the Company")
Unaudited Interim results for the six months ended 30 June
2018
Dated 14 September 2018
Kibo Energy PLC ("Kibo" or the "Company"), the multi-asset,
Africa focused, energy company, is pleased to announce its
unaudited half year results for the period ended 30 June 2018.
Highlights
-- Considerable progress being made on transforming Kibo into a
focused diversified energy development company in Africa
-- Expansion of the Company's energy project footprint outside
of Tanzania with the acquisition of the Mabesekwa Coal Independent
Power Project ("MCIPP") in Botswana, and joint venture on the Benga
Independent Power Project ("BIPP") in Mozambique
-- Kibo remains confident in the commitment and support of the
Tanzanian Government for the Mbeya Coal to Power Project
("MCPP")
-- Strengthened international partnership team with Strategic
Development Agreement signed with SEPCOIII - represents a major
endorsement of Kibo's ability to source, develop and construct
major energy projects globally
-- Placings to raise GBP2.25 million and shares issued for
settlement of outstanding balance on the Sanderson forward payment
facility provided stable funding for the on-going work on existing
projects and costs associated with the new acquisitions during the
first half of 2018
-- Name change to Kibo Energy PLC to more accurately reflect the
Company's new focus on energy development
-- Administrative expense down 46.5% year on year and loss per share down 58% year on year
Chairman's Statement
This has been a very active period for the Company, during which
we have expanded our portfolio, signed additional strategic
agreements with international blue chips and solidified our
position in the African energy market. I am therefore pleased to
present our half-year accounts for the period ending 30 June 2018
and provide a summary of these developments, which I believe
underline the strength of our offering and its potential.
There is a significant and expanding opportunity in the African
energy sector due to the acute shortage of power. We aim to
participate in the solution and now have the Mbeya Coal to Power
Project ("MCPP") in Tanzania, the Mabesekwa Coal Independent Power
Project ("MCIPP") in Botswana and the Benga Independent Power
Project ("BIPP") in Mozambique. Additionally, with the inclusion of
our recent Memorandum of Understanding ("MOU") with Mast Energy
Developments in the UK, we have further expanded our offering and
successfully transformed Kibo from a multi-commodity exploration
company to a diversified energy development company in Africa with
a broad-based platform from which to build value.
Operations
As you are aware, we have been engaged in continual discussion
with the Tanzanian Government on the Power Purchase Agreement
("PPA") for the MCPP, following the signing of a MOU on the PPA in
mid-February. Agreement on a follow-up definitive PPA, based on the
terms of the MOU, is currently at an advanced stage of negotiation
and, while taking longer to conclude than anticipated, the Company
remains confident in the commitment and support of the Tanzanian
Government for the MCPP, notwithstanding its complex nature and
scale and the additional requirements needed from Kibo necessitated
by the recent changes to the Tanzanian mining legislation. This
situation is clear from both our private discussions with Tanzanian
Government officials and their public announcements. The country's
commitment to private sector input to national development projects
includes those that address the country's growing energy deficit.
Indeed, President Magufuli's recent pronouncements at the Tanzanian
National Business Council meeting in March is an example of this
commitment and further underpins our confidence in the process.
On a wider level, during the period, your Company continued to
deepen and expand its relationship with Chinese based international
EPC contractor SEPCOIII, already a key partner in the development
of the MCPP, following Kibo awarding it the EPC contract to build
the MCPP power plant in November 2016. Both parties agreed that PPA
discussions with the Tanzanian Government had advanced sufficiently
to warrant signing of the second part of the contract. This was
signed in May thereby awarding SEPCOIII the EPC contract for the
construction of the power line that will evacuate power from the
proposed Mbeya Power Plant to the nearest sub-station in Mbeya.
This is contingent on a successful Financial Close.
In early July, Kibo further cemented its relationship with
SEPCOIII by signing a Strategic Development Agreement ("SDA") which
commits SEPCOIII to a direct equity investment in Kibo and an
option to make a second equity investment within 18 months of the
first. The investment amounts constitute 10% to 15% of Kibo's share
capital for the first investment and 5% to 10% for the second, with
the precise amounts and share subscription price to be negotiated
between the parties at the respective investment dates (refer to
our RNS of the 3rd July for full details). In consideration for
these equity investments, Kibo has granted SEPCOIII the right to
become the sole bidder for all EPC contracts pertaining to its
existing and future energy development projects anywhere in the
world, subject to its bids meeting strict EPC-specifications
developed by Kibo and its engineers. I believe this SDA with a
proven international energy developer represents a major
endorsement of our ability to source, develop and construct major
energy projects globally and will significantly empower the
Company's ability to bring projects to Financial Close.
In April, the Company completed the acquisition of an 85%
interest in the MCIPP in Botswana in an all share transaction which
we first announced in November 2017. This marked the first step in
the diversification of our asset portfolio outside of Tanzania and
in realizing our new strategy of becoming a diversified energy
developer with a primary focus on sub-Saharan Africa. I believe
that the MCIPP is a particularly well considered acquisition
because of its similarity with MCPP in terms of size, projected
development path, a demand-led electricity market and government
support. Additionally, there is considerable scope for Kibo to
leverage its existing expertise and partner networks from the MCPP.
Work by Kibo on MCIPP commenced immediately post acquisition and on
21 June 2018 we published a SAMREC-compliant maiden Coal Resource
Statement[1] of approximately 303 million tonnes on a 100% basis
(approximately 258Mt on an 85% attributable basis) of thermal coal
underpinning the MCIPP of which Kibo holds an 85% interest.
Pleasingly, the results of further technical studies on the coal
are showing that improved coal yields and lower sulphur contents
can be achieved by industry standard beneficiation processes prior
to burning. I also welcome our project partner, Shumba Energy
("Shumba"), which has completed significant feasibility work on the
project and which will shortly be nominating a new director to our
board in line with the terms of the MCIPP acquisition. Shumba bring
a long history of operating in Botswana and have a strong
institutional investor base and now, as a significant Kibo
shareholder, will substantially benefit from Kibo's on-going
development of the MCIPP.
Further expanding on our African energy project footprint, we
announced our second major acquisition outside of Tanzania in June
with the signing of a joint venture agreement ("JV") with
Mozambican company Termoeléctrica de Benga S.A ("Termoeléctrica").
Under the terms of the JV, Kibo and Termoeléctrical will hold
participating interests in the BIPP in the proportions of 65% and
35% respectively. The BIPP shares many similarities with the MCPP
and the MCIPP and comprises an advanced proposal for the
development of a 150 MW to 300 MW thermal power plant in Mozambique
close to current thermal coal producers. Termoeléctrica already has
various authorisations and agreements in place pertaining to the
development of a thermal power plant. This includes, inter alia,
permission from the Mozambique Government to proceed with a final
Definitive Feasibility Study ("DFS"), an MOU with the state
electricity distribution company, in-principle confirmation of
water availability from the local water authority, and, lease title
over land for project construction. Letters of comfort from
potential coal suppliers and power off-takers are also in place for
the project. Kibo's initial funding commitment is a maximum GBP1
million to fund the DFS and so maintain its 65% interest in the JV;
thereafter both parties to the JV will fund development on a
pro-rata basis save for Kibo's right to increase its JV interest to
85% within a year of producing a positive DFS at a price to be
agreed between the parties. I am pleased to note that we have
already embarked on a DFS path for this project building on the
pre-feasibility work carried out to date by Termoeléctrica and we
look forward to providing shareholders with updates on progress as
we proceed.
Further to the acquisition and joint ventures discussed above,
we also announced the sale of our Haneti Nickel Project ("Haneti")
to Katoro Gold Limited in June in an all share transaction. Kibo
will receive 15,384,615 new Katoro shares at a price of 1.3p per
Katoro share (which values Haneti at GBP200,000) upon successful
completion of the transaction. Additionally, Kibo will retain a 2%
Net Smelter Royalty from any concentrates produced from the Haneti
mineral licenses. This divestment will free up Company resources to
focus on its expanding energy project portfolio while retaining a
significant on-going interest in the future development of Haneti
through its major shareholding in Katoro. This will ensure Kibo
shareholders benefit from the Company's investment in the project
to date and from any future upside following on-going exploration
by Katoro.
Corporate
In addition to the corporate activity associated with the new
acquisitions discussed above, the Company complemented two placings
during the first half of 2018 to fund its on-going operations
across its growing energy portfolio. These were undertaken in March
(see RNS dated 27 February 2018) and April (see RNS dated 10 April
2018) for GBP750,000 and GBP1,500,000 respectively (total of
GBP2.25 million). The placing subscription prices were 4.25p (March
placing) and 5.25p (April Placing) and a total of 46,218,488 new
Kibo shares were issued to subscribers. The March placing
overlapped with our broker at the time, Beaufort Securities Limited
("Beaufort") being put into insolvency which necessitated the
appointment of a new broker, SVS Securities Limited ("SVS")
pursuant to AIM rule 35 to replace Beaufort. Fortunately, SVS were
able to complete the placing for the full amount. The April placing
was completed jointly by both SVS and Novum Securities Limited
("Novum"). Coinciding with this placing, Novum were appointed joint
brokers. The proceeds of these placings have provided stable
funding for the on-going work on existing projects and costs
associated with the new acquisitions during the first half of 2018.
Also, in April, we announced changes in responsibilities among our
board members and reconstituted our executive management team to
align better with the current strategy of the Company and the skill
sets required to take it to the next stage of development. In this
regard, I would like to welcome Pieter Krugel to the executive
management team who was appointed as Kibo's Chief Financial
Officer. Mr. Krugel, a qualified Chartered Accountant, brings a
broad range of financial management experience to Kibo and I wish
him well in his new role.
During May, the Company issued 8,370,716 shares in partial
settlement on the balance of funds drawn down under the forward
payment facility agreed with Sanderson Capital Partners
("Sanderson") in December 2016. These shares were issued at a price
of 5p per share and in lieu of a repayment amount of USD 568,712.
On the 9th July, after reporting period end, the Company issued an
additional 21,239,375 shares to Sanderson as full and final
settlement under the forward payment facility. These shares were
issued at a price of 5.25p per share in lieu of a repayment amount
of GBP1,115,067. I am happy to note that these payments have now
settled all outstanding payments from Kibo to Sanderson under the
forward payment facility and the pending $3.7 million due to Kibo
from SEPCOIII at Financial Close of the MCPP will now be wholly
received by Kibo unencumbered.
Kibo also participated in a placing by Katoro in June for an
amount of GBP75,000. The subscription price was 1.3p and Kibo
received 5,769,231 shares bringing its current percentage
shareholding in Katoro to 50.43%.
Recent Developments
Post period end, the Company has gained significant momentum in
its transformation to become a diversified energy developer and at
the AGM, shareholders approved to change the name from Kibo Mining
PLC to Kibo Energy PLC to reflect its sole focus on energy
projects. The appointment of Crowe UK LLP ("Crowe") as the
Company's auditors was also confirmed, and the board believes that
Crowe is well placed to serve our needs within the energy
development sector and with future business plans. I would like to
thank our previous auditors Saffery Champness for its contribution
to Kibo's development over the last few years.
I would also like to take this opportunity to remind
shareholders of recent developments on the MCPP in relation to the
Special Mining Licence Application ("SMLA") and Water Permits. The
relevant Tanzanian authorities have recently indicated a readiness
to consider the SMLA following receipt of some final documentation
necessitated by the recent changes to the Tanzanian mining
legislation (now submitted) and have also provisionally approved
water permits relevant to the water requirements of the MCPP. This
engagement with the Company on its SMLA and Water Permits reflects
our advanced stage of PPA negotiations with the Government and I
believe shows its commitment to ensure all critical path ancillary
documentation and permits are in place in preparation for the
finalization of the PPA.
Our recent announcement of a Memorandum of Understanding with UK
Mast Energy Developments ("MED") to acquire a 60% interest in the
Company, and its subsequent potential to generate revenue streams
for Kibo in the short term at relatively modest cost to the
Company, is a welcome development and I believe further underpins
our commitment to seek out attractive projects in the energy
sector. We look forward to reporting on further progress on this
exciting project which, while initially based in the UK, has
exciting upside potential for the transfer of the technology and
the Reserve Energy market model to the emerging energy markets in
Africa. This model has the potential to complement and provide a
further value generation component to our existing flagship energy
projects.
I conclude by thanking our CEO, Louis Coetzee, and his executive
management team for their persistent and dedicated commitment in
stewarding Kibo along a path to becoming a major African focused
energy development company and power producer with an additional
European presence. I believe we are well on the way to realizing
this vision.
________________________
Christian Schaffalitzky
Chairman
This announcement contains inside information as stipulated
under the Market Abuse Regulations (EU) no. 596/2014 ("MAR").
For further information please visit www.kibomining.com or
contact:
Louis Coetzee info@kibo.energy Kibo Energy PLC Chief Executive Officer
Andreas Lianos +27 (0) 83 4408365 River Group Corporate and Designated
Adviser on JSE
---------------------- -------------------------- ----------------------------
Ben Tadd / +44 (0) 20 3700 SVS Securities Limited Joint Broker
Tom Curran 0093
---------------------- -------------------------- ----------------------------
Jon Belliss +44 (0) 20 7399 Novum Securities Joint Broker
9400 Ltd
---------------------- -------------------------- ----------------------------
Andrew Thomson +61 8 9480 2500 RFC Ambrian Limited NOMAD on AIM
---------------------- -------------------------- ----------------------------
Priit Piip +44 (0) 20 7236 St Brides Partners Investor and Media
1177 Ltd Relations Adviser
---------------------- -------------------------- ----------------------------
Unaudited Interim Results for the six months ended 30 June
2018
Unaudited condensed consolidated interim Statement of
Comprehensive Income
For the six months ended 30 June 2018
6 months to 6 months to 12 months to
30 June 30 June 31 December
Note 2018 2017 2017
(Unaudited) (Unaudited) (Audited)
GBP GBP GBP
Revenue - 1,001 -
Administrative expenses (924,829) (1,730,200) (1,871,697)
Exploration Expenditure (402,609) (634,141) (1,741,018)
Capital raising fees - - (908,543)
Operating Loss (1,327,438) (2,363,340) (4,521,258)
Other Income 578 - 1,445
------------ ------------ -------------
Loss before Tax (1,326,860) (2,363,340) (4,519,813)
Tax - - -
------------ ------------ -------------
Loss for the period (1,326,860) (2,363,340) (4,519,813)
Other comprehensive
income:
Exchange differences
on translating of
foreign operations,
net of taxes (247,108) 50,148 16,985
Total Comprehensive
Loss for the Period (1,573,968) (2,313,192) (4,502,828)
------------ ------------ -------------
Loss for the period
attributable to (1,326,860) (2,363,340) (4,519,813)
------------ ------------ -------------
Owners of the parent (1,250,934) (1,900,505) (3,712,707)
Non-controlling interest (75,926) (462,835) (807,106)
------------ ------------ -------------
Total comprehensive
loss attributable
to (1,573,968) (2,313,192) (4,502,828)
------------ ------------ -------------
Owners of the parent (1,578,376) (1,850,357) (3,689,196)
Non-controlling interest 4,408 (462,835) (813,632)
------------ ------------ -------------
Basic loss per share 5 (0.0025) (0.0052) (0.010)
Diluted loss per share 5 (0.0025) (0.0052) (0.010)
Unaudited condensed consolidated interim Statement of Financial
Position
As at 30 June 2018
Note 30 June 30 June 30 December
2018 2017 2017
(Unaudited) (Unaudited) (Audited)
GBP GBP GBP
Assets
Non-current assets
Property, plant and equipment 7,847 11,085 7,650
Intangible assets 8 26,972,417 17,596,105 17,596,105
Total non-current assets 26,980,264 17,607,190 17,603,755
------------- ------------- ----------------
Current assets
Trade and other receivables 78,631 117,453 59,046
Cash and cash equivalents 1,679,453 1,946,688 766,586
------------- ------------- ----------------
Total current assets 1,758,084 2,064,141 825,632
------------- ------------- ----------------
Total assets 28,738,348 19,671,331 18,429,387
------------- ------------- ----------------
Equity
Called up share capital 6 16,756,351 13,607,630 14,015,670
Share premium 6 37,719,010 27,327,791 28,469,750
Common control reserve 2,097,442 2,156,726 2,097,442
Translation reserve (595,948) (235,343) (268,506)
Share based payment reserve 556,086 514,279 556,086
Retained deficit (27,785,587) (24,722,536) (26,534,653)
------------- ------------- ----------------
Attributable to equity holders
of the parent 28,747,354 18,648,547 18,335,789
------------- ------------- ----------------
Non-controlling interest (1,378,980) (1,032,591) (1,383,388)
Total Equity 27,368,374 17,615,956 16,952,401
Liabilities
Current liabilities
Trade and other payables 470,646 343,312 266,218
Borrowings 9 899,328 1,712,063 1,210,768
Total current liabilities 1,369,974 2,055,375 1,476,986
------------- ------------- ----------------
Total equity and liabilities 28,738,348 19,671,331 18,429,387
------------- ------------- ----------------
Unaudited Condensed Consolidated Statement of Changes in
Equity
Share Share Share Control Foreign Retained Non-controlling Total
Capital Premium based Reserve currency deficit interest
payment translation
reserve reserve
GBP GBP GBP GBP GBP GBP GBP
Balance at 31 December 2017
(audited) 14,015,670 28,469,750 556,086 2,097,442 (268,506) (26,534,653) (1,383,388) 16,952,401
Loss for the year - - - - - (1,250,934) (75,926) (1,326,860)
Other comprehensive income-
exchange differences on
translating of foreign
operations - - - - (327,442) - 80,334 (247,108)
Proceeds of share issue of
share capital 2,740,681 9,249,260 - - - - - 11,989,941
------------ ----------- -------- ---------- ------------ ------------- ---------------- ------------
Balance as at 30 June 2018 16,756,351 37,719,010 556,086 2,097,442 (595,948) (27,785,587) (1,378,980) 27,368,374
(unaudited)
------------ ----------- -------- ---------- ------------ ------------- ---------------- ------------
Balance at 1 January 2017
(audited) 13,603,965 27,318,262 514,279 - (285,491) (23,625,367) (1,435) 17,524,213
Loss for the year - - - - - (1,900,505) (462,835) (2,363,340)
Other comprehensive income-
exchange differences on
translating of foreign
operations - - - - 50,148 - - 50,148
Adjustment arising from
acquisition of subsidiary - - 41,808 2,114,918 - 803,336 (568,321) 2,391,741
Proceeds of share issue of
share capital 3,665 9,529 - - - - - 13,194
------------ ----------- -------- ---------- ------------ ------------- ---------------- ------------
Balance at 30 June 2017
(unaudited) 13,607,630 27,327,791 514,279 2,156,726 (235,343) (24,722,536) (1,032,591) 17,615,956
------------ ----------- -------- ---------- ------------ ------------- ---------------- ------------
Balance at 1 January 2017
(audited) 13,603,965 27,318,262 514,279 - (285,491) (23,625,367) (1,435) 17,524,213
Loss for the year - - - (3,712,707) (807,106) (4,519,813)
Other comprehensive income
- exchange differences - - - - 319,102 - (6,526) 312,576
Adjustment arising from
acquisition of subsidiary - - - 2,097,442 (302,117) 803,421 (568,321) 2,030,425
Share options issued during
the current period - - 41,807 - - - - 41,807
Proceeds of share issue of
share capital 411,705 1,151,488 - - - - - 1,563,193
------------ ----------- -------- ---------- ------------ ------------- ---------------- ------------
Balance at 31 December 2017
(audited) 14,015,670 28,469,750 556,086 2,097,442 (268,506) (26,534,653) (1,383,388) 16,952,401
------------ ----------- -------- ---------- ------------ ------------- ---------------- ------------
Unaudited condensed consolidated interim statement of cash
flow
For the six months ended 30 June 2018
6 months 6 months 12 months
to to to
30 June 30 June 31 December
2018 2017 2017
(Unaudited) (Unaudited) (Audited)
GBP GBP GBP
Loss for the period before taxation (1,326,860) (2,363,340) (4,519,813)
Adjusted for:
Foreign exchange gain/(loss) (129,425) 48,236 249,437
Depreciation on property, plant
and equipment - 2,420 2,738
Provisions - (115,663) (115,663)
Shares based remuneration to directors - - 260,000
Deemed cost of listing - - 206,680
Deal cost settled in shares - - 155,539
Liabilities settled in shares - 357,002 -
Operating income before working
capital changes (1,456,285) (2,071,345) (3,761,082)
Increase in trade and other receivables (19,585) (66,820) (8,413)
Increase in trade and other payables 204,428 196,961 119,838
Net cash outflows from operating
activities (1,271,442) (1,941,204) (3,649,657)
Cash flows from investing activities
Purchase of property, plant and
equipment - - (1,175)
Net cash flow from acquisition of
subsidiaries - 2,045,418 465,408
Net cash used in investing activities - 2,045,418 464,233
Cash flows from financing activities
Repayment of borrowings (199,709) - -
Proceeds from borrowings 251,565 1,460,135 1,751,326
Proceeds from issue of share capital* 2,132,453 - 1,818,345
Net cash proceeds from financing
activities 2,184,309 1,460,135 3,569,671
Net increase in cash and cash equivalents 912,867 1,564,349 384,247
Cash and cash equivalents at beginning
of period 766,586 382,339 382,339
------------ ------------ --------------
Cash and cash equivalents at end
of period 1,679,453 1,946,688 766,586
------------ ------------ --------------
*During the period, the Group had concluded significant non-cash
transactions related to the acquisition of a 85% interest in the
Mabesekwa Independent Coal to Power Project (MICPP) in the amount
of GBP9.3mil as well as a partial settlement of the Sanderson
Capital Partners Limited forward payment facility in the amount of
EUR0.4mil. Note 6 provides further information on these
transactions, and the impact thereof on the capital in issue.
Notes to the unaudited condensed consolidated interim financial
statements
For the six months ended 30 June 2018
1. General information
Kibo Energy plc ("formerly Kibo Mining plc") is a public limited
company incorporated in Ireland. Kibo Mining plc announced its
change of name to Kibo Energy plc effective from 3 August 2018
onward. The condensed consolidated interim financial results
consolidate those of the Company and its subsidiaries (together
referred to as the "Group"). The Company's shares are listed on the
AIM of the London Stock Exchange and the Alternative Exchange of
the JSE Limited (AltX). The principal activities of the Company and
its subsidiaries are related to the exploration for and development
of coal and other minerals in Tanzania.
2. Statement of Compliance and Basis of Preparation
The condensed consolidated interim financial results are for the
six months ended 30 June 2018, and have been prepared using the
same accounting policies as those applied by the Group in its
December 2017 consolidated annual financial statements, which are
in accordance with the framework concepts and the recognition and
measurement criteria of the International Financial Reporting
Standards and Financial Reporting Pronouncements as issued by the
Financial Reporting Standards Council issued by the International
Accounting Standards Board ("IASB") as adopted for use in the EU
("IFRS"), including the SAICA Financial Reporting Guides as issued
by the Accounting Practices Committee, IAS 34 - Interim Financial
Reporting, the Listings Requirements of the JSE Limited, the AIM
rules of the London Stock Exchange and the Irish Companies Act
2015.
These condensed consolidated interim financial statements do not
include all the notes presented in a complete set of consolidated
annual financial statements, as only selected explanatory notes are
included to explain key events and transactions that are
significant to obtaining an understanding of the changes throughout
the financial period, accordingly the report must be read in
conjunction with the annual report for the year ended 31 December
2017.
The comparative amounts in the consolidated financial results
include extracts from the consolidated annual financial statements
for the period ended 31 December 2017.
These extracts do not constitute statutory accounts in
accordance with the Irish Companies Acts 2015. All monetary
information is presented in the presentation currency of the
Company being Pound Sterling. The Group's principal accounting
policies and assumptions have been applied consistently over the
current and prior comparative financial period.
3. Use of estimates and judgements
Preparing the condensed consolidated 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.
In preparing these condensed consolidated interim financial
statements, significant judgements made by management in applying
the Group's accounting policies and the key sources of estimation
uncertainty were the same as those applied to the consolidated
financial statements as at and for the year ended 31 December
2017.
Exploration and evaluation expenditure
The Group's accounting policy for exploration and evaluation
expenditure results in the capitalisation of certain intangible
mineral resources which are identified through business
combinations or equivalent acquisitions. This policy requires
management to make certain estimates and assumptions as to future
events and circumstances, in particular whether an economically
viable extraction operation can be established based on the
separately identified mineral resources. Any such estimates and
assumptions may change as new information becomes available. If,
after having capitalised the intangible mineral resources under the
policy, a judgement is made that recovery of the intangible asset
is unlikely, the relevant capitalised amount will be written off to
the income statement.
4. Adoption of new and revised standards
From 1 January 2018 the following standards, amendments and
interpretations were adopted by the group:
- IFRS 9: Financial instruments
- IFRS 15: Revenue from contracts with Customers
The adoption of the above has not had a significant impact on
the group's result for the period under review or for any
comparative period presented.
5. Loss per share
Basic, dilutive and headline loss per share
The basic and weighted average number of ordinary shares used in
the calculation of basic earnings per share is as follows:
6 months to 6 months 12 months
to to
30 June 30 June 31 December
2018 2017 2017
GBP GBP GBP
Loss for the year attributable
to equity holders of the parent (1,250,934) (1,900,505) (3,712,707)
Weighted average number of
ordinary shares for the purposes
of basic and dilutive loss
per share 496,954,459 364,254,364 372,255,127
Basic loss per share (0.0025) (0.0052) (0.010)
6 months 6 months 12 months
to to to
Reconciliation of Headline loss per share 30 June 30 June 31 December
2018 2017 2017
GBP GBP GBP
Loss for the year attributable to equity
holders of the parent (1,250,934) (1,900,505) (3,712,707)
Deemed cost of listing - - 206,680
Headline loss per share (1,250,934) (1,900,505) (3,506,027)
------------ ------------ ------------
Weighted average number of ordinary shares
for the purposes of headline loss per
share (revised) 496,954,459 364,254,364 372,255,127
Headline loss per share (0.0025) (0.0052) (0.010)
Headline earnings per share (HEPS) is calculated using the
weighted average number of ordinary shares in issue during the
period and is based on the earnings attributable to ordinary
shareholders, after excluding those items as required by Circular
4/2018 issued by the South African Institute of Chartered
Accountants (SAICA).
6. Called up share capital and share premium
Authorised ordinary share capital of the company is
1,000,000,000 ordinary shares of EUR0.015 each and 3,000,000,000
deferred shares of EUR0.009 each.
Detail of issued capital is as follows:
Number of
Ordinary Share Deferred Share
Share
shares Capital Capital Premium
GBP GBP GBP
Balance at 31 December
2016 363,976,596 4,346,890 9,257,075 27,318,262
Shares issued in period
(net of expensed for cash) 31,277,768 411,705 - 1,151,488
Balance at 31 December
2017 395,254,364 4,758,595 9,257,075 28,469,750
------------ ---------- ---------- -----------
Shares issued in period
(net of expensed for cash) 208,299,234 2,740,681 - 9,249,260
------------ ---------- ---------- -----------
Balance at 30 June 2018 603,553,598 7,499,276 9,257,075 37,719,010
------------ ---------- ---------- -----------
The company issued the following ordinary shares during the
period, with regard to key transactions:
- 17,647,060 ordinary shares were issued on 27 February 2018 at
4.25p per share. The GBP750,000 raised was utilised to advance the
company's strategy to create a strategic regional electricity
supplier;
- 153,710,030 new ordinary shares in the company were issued on
3 April 2018 at GBP0.061 per share. The shares were issued under
the agreement with Sechaba Natural Resources Limited whereby the
company acquired an 85% interest in the Mabesekwa Independent Coal
to Power Project, located in Botswana;
- 28,571,428 ordinary shares were issued on 10 April 2018 at
5.25p per share. The GBP1,500,000 received went towards general
working capital and expediting ongoing advanced feasibility studies
at the Mabesekwa Independent Coal to Power Project as well as
strengthening the company's financial position ahead of the
commencement of further work at the Mbeya Coal to Power Project;
and
- 8,370,716 ordinary shares were issued on 1 May 2018 at 5p per
share as a partial settlement on the balance of funds drawn down
under the forward payment facility between the company and
Sanderson Capital Partners Limited.
7. Segment analysis
IFRS 8 requires an entity to report financial and descriptive
information about its reportable segments, which are operating
segments or aggregations of operating segments that meet specific
criteria. Operating segments are components of an entity about
which separate financial information is available that is evaluated
regularly by the chief operating decision maker. The Chief
Executive Officer is the Chief Operating decision maker of the
Group.
Management currently identifies two divisions as operating
segments - mining and corporate. These operating segments are
monitored and strategic decisions are made based upon them together
with other non-financial data collated from exploration activities.
Principal activities for these operating segments are as
follows:
30 June 2018 Mining and 30 June 2018
Exploration Corporate (GBP)
Group Group Group
Revenue - - -
Administrative cost - (924,829) (924,829)
Exploration expenditure (402,609) - (402,609)
Investment and other income 578 - 578
Loss after tax (402,031) (924,829) (1,326,860)
------------- ---------- -------------
30 June 2017 Mining and 30 June 2017
Exploration Corporate (GBP)
Group Group Group
Revenue 1,001 - 1,001
Administrative cost - (1,730,200) (1,730,200)
Exploration expenditure (634,141) - (634,141)
Investment and other income - - -
Loss after tax - - -
(633,140) (1,730,200) (2,363,340)
------------- ------------ -------------
30 June 2018 30 June 2018
Mining Corporate (GBP)
Group Group Group
----------- ---------- -------------
Assets
Segment assets 19,206,661 9,531,687 28,738,348
Liabilities
Segment liabilities 391,334 978,640 1,369,974
Other Significant items
Depreciation - - -
31 December 2017 31 December
Mining Corporate 2017 (GBP)
Group Group Group
----------- ---------- ------------
Assets
Segment assets 18,423,284 6,103 18,429,387
Liabilities
Segment liabilities 264,562 1,297,504 1,562,066
Other Significant items
Depreciation 2,738 - 2,738
8. Intangible assets
6 months 6 months 12 months
to to to
Composition of Intangible assets 30 June 30 June 31 December
2018 2017 2017
GBP GBP GBP
Mbeya Coal to Power Project 15,896,105 15,896,105 15,896,105
Lake Victoria 1,700,000 1,700,000 1,700,000
Mabesekwa Coal Independent Power Project 9,376,312 - -
26,972,417 17,596,105 17,596,105
----------- ----------- ------------
Intangible assets are not amortised, due to the indefinite
useful life which is attached to the underlying prospecting rights,
until such time that active mining operations commence, which will
result in the intangible asset being amortised over the useful life
of the relevant mining licences.
Intangible assets with an indefinite useful life are assessed
for impairment on an annual basis, against the prospective fair
value of the intangible asset. The valuation of intangible assets
with an indefinite useful life is reassessed on an annual basis
through valuation techniques applicable to the nature of the
intangible assets.
Refer to note 11 for more information on the Mabesekwa Coal
Independent Power Project.
9. Borrowings
6 months 6 months 12 months
to to to
Amounts falling due within one year 30 June 30 June 31 December
2018 2017 2017
GBP GBP GBP
Short term borrowings 899,328 1,712,063 1,210,768
899,328 1,712,063 1,210,768
--------- ---------- ------------
The borrowings relate to the unsecured interest free loan
facility from Sanderson Capital Partners Limited which was
repayable either through the issue of cash or ordinary shares in
the Company.
Refer also to note 6 for detail on the shares issued during the
period as partial settlement of the facility.
10. Financial instruments
6 months 6 months 12 months
to to to
30 June 30 June 31 December
2018 2017 2017
GBP GBP GBP
Financial assets - carrying amount
Loans and receivable held at amortised
cost
Trade and other receivables 78,631 117,453 59,046
Cash and cash equivalents 1,679,453 1,946,688 766,586
---------- ---------- ------------
1,758,084 2,064,141 825,632
---------- ---------- ------------
Financial liabilities - carrying amount
Financial liabilities held at amortised
cost
Trade and other payables 470,646 343,312 266,218
Borrowings 899,328 1,712,063 1,210,768
---------- ---------- ------------
1,369,974 2,055,375 1,476,986
---------- ---------- ------------
The Board of Directors considers that the fair values of
financial assets and liabilities approximate their carrying values
at each reporting date.
11. Corporate transactions
Kibo Nickel Disposal
The Group has entered into an agreement to dispose 100% of Kibo
Nickel Limited ("Kibo Nickel"), a wholly owned subsidiary of Kibo
(Cyprus) Limited, to Katoro Gold Limited ("Katoro"), also a
subsidiary of the company. Consideration for the sale will be
settled by the issue of 15,384,615 new ordinary shares in Katoro at
a price of 1.3p per share (valued at GBP200,000) ("Consideration
shares"). The consideration shares will be issued to Kibo upon
transaction completion and will rank pari passu with the existing
ordinary shares. Kibo will also retain a 2% NSR royalty in respect
of the nickel or mineral concentrates produced and sold from any of
Kibo Nickel's property.
As at interim reporting period end, the suspensive conditions
had not been fulfilled, and control was not lost, thus the
transaction had not become effective. As at the date of this
report, the main suspensive condition, being the successful
completion of a due diligence, is well advanced and, pending the
outcome, it is expected that the transaction will be completed
shortly.
Shumba Acquisition
On 3 April 2018, the Group completed the acquisition of an 85%
interest in the Mabesekwa Coal Independent Power Project, located
in Botswana. This acquisition is in line with the Group's strategy
of positioning itself as a strategic regional electricity supplier
in Southern Africa and creates many synergies with the MCPP in
Tanzania.
As a result of the acquisition, 153,710,030 ordinary shares in
Kibo were issued to Sechaba Natural Resources Limited ("Sechaba").
Sechaba retained a 15% interest in the Mabesekwa Coal Independent
Power Project and gained a seat on Kibo's board of directors.
Benga Power Joint Venture
The Company concluded the Joint Venture Agreement (the 'Benga
Power Joint Venture' or 'JV') with Mozambique energy company
Termoeléctrica de Benga S.A. ('Termoeléctrica') to participate in
the further assessment and potential development of the Benga
Independent Power Project ('BIPP'), including the right to
construct and operate a 150-300MW coal fired power station. Kibo
and Termoeléctrica shall hold initial Participation Interests in
the unincorporated joint venture of 65% and 35% respectively. In
order to maintain this 65% interest, Kibo must fund a maximum of
GBP1 million towards the completion of a Definitive Feasibility
Study for the BIPP. As at 30 June 2018, operations of the Joint
Venture had not yet commenced, and as such expenditure incurred to
this date is insignificant.
12. Unaudited results
These condensed consolidated interim financial results have not
been audited or reviewed by the Group's auditors.
13. Dividends
No dividends were declared during the interim period.
14. Board of Directors
Mr. Tinus Maree, previously non-executive director, joined the
executive committee ("EXCO") of Kibo. Mr. Maree has a robust and
complete understanding of the Company and Kibo will continue to
benefit from Mr. Maree's extensive experience as a corporate lawyer
as he will continue to provide internal legal advice and review in
his new position. Mr. Noel O'Keefe and Mr. Andreas Lianos
transitioned to a non-executive role with the Company. Mr. O'Keefe
shall continue to provide the Company with invaluable technical
advice and oversight and Mr. Lianos will be instrumental in the
Company's financial oversight as non-executive Financial Director
(see RNS dated 10 April 2018).
15. Subsequent events
Share placements
Subsequent to the interim reporting date, the company has raised
the following share placement:
-- GBP500,000 in the placement of 9,523,810 ordinary Kibo shares
at 5.25p per share (see RNS dated 30 July 2018).
Strategic Development Agreement with SEPCOIII
The company has signed a Strategic Development Agreement (SDA)
with China based SEPCOIII, one of the world's largest power EPC
contractors, to work with Kibo towards enhancing its strategy and
the development of its portfolio of energy projects. As part of the
SDA, SEPCOIII has committed to a two-stage equity investment into
Kibo, endorsing the company's strategy and its position in the
African power market (see RNS dated 3 July 2018).
Full settlement of the Sanderson Capital Partners Limited
Facility
On 9 July 2018, Kibo and Sanderson Capital Partners Limited
settled the outstanding balance of GBP 1,115,067.17 on the forward
payment facility agreed on 20 December 2016. Sanderson will be
issued 21,239,375 new ordinary Kibo shares of par value GBP0.015
each, at a price of 5.25p per Kibo share, a 13% premium to the
closing price of 4.65p on Friday 6 July 2018 (see RNS dated 9 July
2018).
Acquisition of 60% Interest in UK Project Development
Company
A Memorandum of Understanding ("MOU") for the acquisition of a
60% equity interest in Mast Energy Developments ("MED"), a private
UK registered company targeting the development and operation of
flexible power plants to service the Reserve Power generation
market. Under the terms of the MOU, the company can acquire a 60%
shareholding in MED for a consideration of GBP300,000 payable to
existing MED shareholders in new Kibo shares and a share of future
project revenue royalties, which will be reinvested in the company
in the short term to an amount of GBP2.2 million (see RNS dated 15
August 2018).
16. Going concern
The condensed consolidated interim financial results are
prepared in accordance with the going concern principle under the
historical cost basis as modified by the fair value accounting of
certain assets and liabilities where required or permitted by IFRS
in the EU.
17. Commitments and contingencies
There are no material commitments, contingent assets or
contingent liabilities as at 30 June 2018.
14 September 2018
By order of the board:
Christian Schaffalitzky Chairman (Non-Executive)
Louis Coetzee Chief Executive Officer (Executive)
Noel O'Keeffe Technical Director (Executive)
Andreas Lianos Chief Financial Officer (Executive)
Lukas Maree Non-Executive Director
Wenzel Kerremans Non-Executive Director
Company Secretary: Noel O'Keeffe
Auditors: Crowe U.K. LLP
Brokers: SVS Securities Limited
20 Ropemaker Street
London EC2Y 9AR
United Kingdom
Novum Securities Limited
London SW1W ODH
UK Nominated Adviser: RFC Ambrian Limited
Level 28, QV1 Building
250 St Georges Terrace
Perth WA 6000
JSE Designated Adviser: River Group
211 Kloof Street
Waterkloof
Pretoria, South Africa
Johannesburg
14 September 2018
Corporate and Designated Adviser
River Group
[1] Reference should be made to the Company's RNS announcement
of the 21(st) June 2018 for details of Kibo's Mabesekwa Coal
Resource, a Competent Person's Statement and the Company's
attributable interest. The Company confirms that there has been no
update to Kibo's Mabesekwa Coal Resource Statement since 21 June
2018.
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.
END
IR BGGDCCXBBGIS
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