28th Mar 2018 07:03
Block Commodities Ltd (BLOC) Block Commodities Ltd: Interim Results 28-March-2018 / 07:00 GMT/BST Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. The issuer is solely responsible for the content of this announcement. Block Commodities Limited / Epic: BLCC / Sector: Mining 28 March 2017 Block Commodities Limited ('Block Commodities' or 'the Company') Interim Results
Chairman's Statement The last six months have seen significant developments for Block Commodities as we begin to implement our new strategy as an innovative commodity operator in Africa.
Our vision is to build a growing revenue-generating business which will create value for all stakeholders, as well as establish your Company as a key contributor of growth and empowerment across sub-Saharan Africa.
In working to build a fertiliser trading business in Africa over the last two years, we have clearly seen the valuable opportunity for security and certainty that blockchain technology could bring to the local commodity and agricultural framework. In this context, in February 2018, the Company changed its name from "African Potash Limited" to "Block Commodities Limited" to better reflect our strategic decision to leverage our existing trading business and network to create a new trading platform to promote and secure an efficient agricultural ecosystem. This platform will help African farmers raise productivity and secure better returns for their produce, while establishing African communities as significant future global agricultural players.
Our model is simple: as part of a blockchain plan which enables us to secure vendor finance for our fertiliser products we will borrow tokens and lend them to farmers (at interest rates lower than current commercial rates); the farmers will then use the tokens to purchase fertiliser products from us. The blockchain-based, closed-loop supply chain allows us to circumvent "the middle man" (and related, unnecessary costs), while simplifying and expediting the process using only one currency throughout: the token. In this way, we hope to empower farmers and democratise the whole fertiliser supply/purchase cycle.
In order to succeed in our objectives, we have identified key world-class partners to work alongside us. In November last year, we announced an agreement with FinComEco Limited, a subsidiary of GMEX Group Limited, as a joint venture partner to deploy a complete blockchain-based agricultural ecosystem trading solutions via integrated token-based microloan financing. FinComEco will ensure the purchase of agricultural commodities grown by the small-scale farmers ("SSF") through the use of existing warehouse receipt systems and commodity exchanges with secure payment of profit to the farmer after the repayment of the loan and interest to the Company. TokenCommunities Limited, a Gibraltar-based token finance specialist, has also been engaged to assist us in facilitating our strategy and plans. In addition, we have decided to take a 21% stake in VIPA Holdings (Pty) Limited ("VIPA"), a leading provider of fertilisers and raw animal feed materials to South Africa's agricultural industry. VIPA will provide us with access to high-quality, specialised agricultural products, forming the procurement platform for our strategy. Finally, we have recently signed a strategic partnership with the Wala/Dala team, a blockchain-powered financial services platform and cryptocurrency token issuer already well-established in African financial services. Wala and Dala will be working to develop and operate a web-enabled mobile phone operable platform using the blockchain ledger for the food commodities cycle trading ecosystem currently being developed with FinComEco. Trading In the first half of the year, we set up four community-based fertilizer warehouses in Zambia. Working capital constraints led to the decision to focus solely on sales to those SSF who had registered with the Zambian government's e-voucher programme (which was scheduled to go live in October 2017). There were persistent delays in rolling out the e-voucher programme and, subsequently, in loading the cards with credit.
In our areas of operation, cards were only loaded in late December 2017and our first sales were successfully made early in 2018. Consequently, there was no turnover in the six months to 31 December 2017, although, following the end of the period under review, sales under the e-voucher scheme have commenced.
Lac Dinga Key to freeing up management's time and shareholder funds to concentrate on developing its broader strategy has been the farming out of the Lac Dinga potash salts concession. On 19 July, the Company announced that it had entered into an agreement with African Agronomix Limited ("AAX") whereby AAX, over a period of time, has the right to acquire up to 100% of the Company's interest in the Lac Dinga exploration licence in the Republic of Congo (held by La Societé des Potasses et des Mines SA ("SPM") in which the Group has a 70% interest).
The agreement with AAX became effective on 17 October 2017 and AAX has been acting as project operator on behalf of SPM since this time. AAX is currently planning a further drilling campaign in support of its application to renew the exploration licence for a further two years from 25 April 2018.
Financial results Revenue for the 6 months to 31 December 2017 was $nil (2016: $103,000). Operating expenses for the period fell to $263,000 (2016: $782,000). After an impairment charge in respect of exploration assets of $271,000 (2016: $284,000) and $101,000 in respect of the decision to divest of its stake in Advanced Agricultural Holdings (Pty) Limited, the loss before taxation for the period was $782,000 (2016: $1,188,000). Cash balances at 31 December 2017 were $206,000 (2016: $30,000).
OutlookThe last six months have been a transitional period of positive change for Block Commodities. Management believes that blockchain technology and the array of potential applications will transform day-to-day life in the future. The Company's local understanding and early mover advantage into the blockchain and crypto space has provided it with invaluable insight, connections and investment opportunities to be leveraged for the benefit of all stakeholders. In order to allow us maximise our trading business in Africa we have been very active in identifying the most suitable local partners to assist us in developing our strategy and to build the right innovative and forward-thinking platform.
We aim to build a business which generates high revenues, whilst maintaining a strong social humanitarian and empowerment ethos.
Block Commodities' pilot agricultural ecosystem platform project in collaboration with the Dala/Wala financial platform and FinComEco, will be located in Uganda and if successful, we expect to quickly expand into other sub-Saharan countries and explore opportunities for other commodities which are compatible with our platform and could benefit from our blockchain-based model. We would like to sincerely thank our loyal shareholders for their continued and patient support over the last year and we look forward to updating the market with news of Block Commodities' progress in the future - we are just at the beginning of an exciting journey!
Chris Cleverly Executive Chairman
UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2017
Unaudited Consolidated Income Statement For the half year to 31 December 2017
All results relate to continuing activities
Unaudited Consolidated Comprehensive Income Statement For the half year to 31 December 2017
Unaudited Consolidated Statement of Financial Position As at 31 December 2017
Statement of Changes in Equity
Unaudited Consolidated Statement of Cash Flows
Notes to the Unaudited Interim Financial Statements
Block Commodities Limited ('Block Commodities' or the 'Company') is building a fertiliser trading business and network to create a new trading platform using block chain technology to promote and secure an efficient agricultural ecosystem as it seeks to develop an integrated African focussed fertiliser operation. Block Commodities is a public limited company incorporated and domiciled in the Guernsey. The address of its registered office is Richmond House, St Julians Avenue, St Peter Port, Guernsey GY1 1GZ.
The Company is admitted to trading on the NEX Exchange Growth market.
The unaudited interim financial statements for the 6 months ended 31 December 2017 were approved for issue by the board on 27 March 2018.
The interim financial statements for the 6 months ended 31 December 2017 and the 6 months ended 31 December 2016 are unaudited and do not constitute full accounts. The comparative figures for the year ended 30 June 2017 are extracts from the annual report and do not constitute statutory accounts.
The unaudited interim financial statements have been prepared in US Dollars as this is the currency of the primary economic environment in which the Group operates.
The condensed consolidated financial statements of the Group for the six months ended 31 December 2017, which are unaudited and have not been reviewed by the Company's auditor, have been prepared in accordance with the International Financial Reporting Standards ('IFRS'), as adopted by the European Union, accounting policies adopted by the Group and set out in the annual report for the year ended 30 June 2017 (available at www.blockcommodities.com). The Group does not anticipate any additional significant change in these accounting policies for the year ended 30 June 2018. References to 'IFRS' hereafter should be construed as references to IFRSs as adopted by the EU.
While the financial figures included in this report have been computed in accordance with IFRSs applicable to interim periods, this report does not contain sufficient information to constitute an interim financial report as that term is defined in IFRSs.
The financial information contained in this report also does not constitute statutory accounts under the Companies (Guernsey) Law 2008, as amended.
Basis of accounting The unaudited interim financial statements have been prepared on the historical cost basis except for financial instruments measured at fair value. The principal accounting policies adopted are consistent with those of the financial statements for the year ended 30 June 2017.
The directors consider that the Group's activities comprise the segments of fertiliser trading and potash exploration and other unallocated expenditure in one Geographical segment, Africa.
Revenue represents sales to external customers. Unallocated expenditure relates to central costs and any items of expenditure that cannot be directly attributed to an individual segment.
Segment assets consist primarily of intangible assets, property, plant and equipment, other receivables and cash and cash equivalents. Segment liabilities comprise operating liabilities.
Capital expenditure comprises of additions to property, plant and equipment and intangibles.
The segment assets and liabilities at 31 December 2017 and capital expenditure for the year then ended are as follows:
Segment assets and liabilities are reconciled to Group assets and liabilities as follows:
The segment assets and liabilities at 31 December 2016 and capital expenditure for the year then ended are as follows:
Segment assets and liabilities are reconciled to Group assets and liabilities as follows:
The segment assets and liabilities at 30 June 2017 and capital expenditure for the year then ended are as follows:
Segment assets and liabilities are reconciled to Group assets and liabilities as follows:
The calculation of basic and diluted earnings per share is based on the following data:
Evaluation and exploration costs are capitalised in accordance with IFRS6
The asset comprises the Lac Dinga exploration licence in the Republic of Congo held by La Societé des Potasses et des Mines SA ("SPM") in which the Group has a 70% interest. On 19 July the Company announced that it had entered into an agreement with African Agronomix Limited ("AAX") whereby AAX has the right to acquire up to 100% of the Company's interest in the project. The agreement was effective 17 October 2017 and AAX are acting as operator of the project on behalf of SPM. AAX are currently planning a further drilling campaign in support for its application to renew the exploration license for a further two years from 25 April 2018.
On 14 March 2018, the Company announced that it is taking a 21% stake in Vipa Holdings (Pty) Limited ("Vipa") a wholesaler of speciality fertilisers and other Agricultural inputs into the South African market. The Company believes that its partnership with Vipa will provide a valuable source of quality products for its food commodities cycle trading ecosystem (The 'ECT EcoSystem') which is currently being established by the Company and its partner FinComEco. Consequently, the Company is divesting its interest in Advanced Agricultural Holdings Limited and the investment has been fully impaired.
On 1 September 2016 235,294,118 shares were issued at 0.2125 pence to fund the working capital requirements of the group. In addition, the Company issued 17,908,235 shares to settle an outstanding historic liability.
On 6 February 2017 279,277,777 shares were issued at 0.045p for cash to fund working capital and 55,178,356 were issued at 0.045p to satisfy various creditors.
On 27 February 2017 a further 59,000,000 were issued at 0.045p for cash and 118,888,888 shares were issued at 0.045p to directors in settlement of outstanding fees.
On 16 June 2017, 221,601,740 shares were issued at 0.045p in satisfaction of the initial consideration due on the acquisition of 21% Advanced Agricultural Holdings (Pty) Limited.
On 17 July 2017, 111,111,111 shares were issued at 0.045p for cash.
On 25 October, 100,000,000 shares were issued at 0.06p for cash.
On 16 November 2017 and 15 December 1,600,000,000 shares were issued at 0.025p for cash and a further 160,000,000 were issued to advisors. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ISIN: | GG00B4QYTJ50 |
| Category Code: | IR |
| TIDM: | BLOC |
| Sequence No.: | 5338 |
| End of Announcement | EQS News Service |
669603 28-March-2018
UK Regulatory announcement transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement.
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