30th Apr 2009 10:41
UMC Energy Plc
("UMC" or "the Company")
Final results
for the year ended 31 December 2008
The Board of UMC is pleased to announce its audited results for the year to 31 December 2008.
CHAIRMAN'S STATEMENT
The original exploration plan for 2008 had involved a drilling programme designed to validate the CEA indicated resource at Folakara. However, following a review of strategic priorities, it was decided to suspend this programme in favour of a more comprehensive programme of fieldwork designed to evaluate the full range of drill targets/opportunities in the total tenement package.
An airborne spectrometric survey had been flown over the entire Makay tenements (~9,400 sq km) at a 400m spacing and 80m elevation using the Medusa spectrometric airborne system with a total of over 23,000 line kms in 2007.
The processing and analysis of the Medusa airborne radiometric data for both the Folakara and Makay tenements began in late 2007 and continued in 2008. The base line data was reprocessed to produce colour images of the uranium channel and stacked profiles of the uranium and uranium / thorium ratio. From this data, a total of 29 anomalies at Folakara and 21 anomalies in the Makay tenements were identified as being of interest for field investigation.
Two periods of helicopter supported field work were undertaken in August and October 2008 when conditions were best suited to this work. This programme involved conducting initial ground radiometrics and spot surface sampling on the identified anomalies at Folakara and Makay that were identified from the airborne data.
The programme at Folakara was successful in locating 28 (of the 29) identified targets. Ground traversing with a spectrometer was undertaken in the vicinity of the anomaly, indicative assays taken with the spectrometer and in several cases grab surface samples collected. Outcomes of this work include:
Several additional sites of potential mineralisation have been located. These sites warrant further testing.
The mineralisation is more widespread than previously understood.
The assays (spectrometer and laboratory) of the areas of interest highlight a strong correlation with vanadium and low levels of thorium which is characteristic of uranium deposits.
The work supports the earlier thesis of mineralisation (deposits) at a grade of several hundred ppm U3O8.
The programme at Makay was successful in locating 16 (of the 21) identified targets, as a mechanical failure with the helicopter required the premature cessation of the programme. The same process as undertaken at Folakara was carried out at Makay. Outcomes of this work include:
A large area of potential mineralisation is indicated by 5 sites in the north-east of the tenements over an area measuring approximately 50km x 10km. Each of these sites has the potential to host small/medium sized uranium deposits.
The presence of low thorium and high vanadium levels suggest that the potential mineralization is of the right type and supports the concept of being in close proximity to a uranium deposit.
The 2008 field work was used as the basis for determining the boundaries of tenement retention in 2009. With these criteria, approximately 50% of the Folakara tenement (~200sq kms) and 25% of the Makay tenements (~750 sq kms) are being retained for 2009.
As has been widely reported in the press, Madagascar is presently experiencing a period of political upheaval and uncertainty. Although the Company has not, in any way, been negatively affected by these events, it has resolved to take a cautious approach to exploration and accordingly does not expect to undertake any material exploration activities in Madagascar during this period of uncertainty.
Chris Kyriakou
Chairman
29 April 2009
Enquiries:
UMC Energy Plc
Annie Richards
Tel: 020 7514 1480
www.umc-energy.com
Strand Partners Limited
Angela Peace
Tel: 020 7409 3494
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2008
|
Year |
Period |
||
|
Ended |
1 February 2007 to |
||
|
31 December 2008 |
31 December 2007 |
||
|
£ |
£ |
||
|
Administrative expenses |
(652,535) |
(957,458) |
|
|
Exceptional costs |
- |
(1,366,338) |
|
|
Other operating income |
8,829 |
19,742 |
|
|
Loss from operations |
(643,706) |
(2,304,054) |
|
|
Investment income |
1,966 |
55,504 |
|
|
Finance costs |
(163,454) |
(136,634) |
|
|
Loss before taxation |
(805,194) |
(2,385,184) |
|
|
Income tax expense |
- |
- |
|
|
Loss for the year / period |
(805,194) |
(2,385,184) |
|
|
Attributable to: |
|||
|
Equity holders of the parent |
(726,309) |
(2,404,028) |
|
|
Minority interest |
(78,885) |
18,844 |
|
|
________ |
_________ |
||
|
(805,194) |
(2,385,184) |
||
|
Loss per share (pence) |
|||
|
Basic |
(2.36) |
(7.81) |
|
|
Diluted |
(2.23) |
(6.90) |
|
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2008
|
31 December 2008 |
31 December 2007 |
||
|
ASSETS |
£ |
£ |
|
|
Non-current assets |
|||
|
Intangible assets |
4,924,326 |
3,949,669 |
|
|
Property, plant and equipment |
30,357 |
20,795 |
|
|
Taxation receivable |
290,243 |
233,483 |
|
|
Total non-current assets |
5,244,926 |
4,203,947 |
|
|
Current assets |
|||
|
Taxation receivable |
6,936 |
5,587 |
|
|
Trade and other receivables |
28,744 |
17,590 |
|
|
Cash and cash equivalents |
23,971 |
259,276 |
|
|
Total current assets |
59,651 |
282,453 |
|
|
________ |
________ |
||
|
TOTAL ASSETS |
5,304,577 |
4,486,400 |
|
|
EQUITY AND LIABILITIES |
|||
|
Current liabilities |
|||
|
Short term borrowings |
- |
3,630 |
|
|
Loans |
1,035,626 |
- |
|
|
Trade and other payables |
158,353 |
451,744 |
|
|
Total current liabilities |
1,193,979 |
455,374 |
|
|
Non-current liabilities |
|||
|
Long term provision |
335,206 |
187,327 |
|
|
Total non-current liabilities |
335,206 |
187,327 |
|
|
________ |
_______ |
||
|
Total liabilities |
1,529,185 |
642,701 |
|
Equity |
|||
|
Share capital |
154,033 |
1,540,333 |
|
|
Share premium account |
4,478,453 |
4,478,453 |
|
|
Share based payments reserve |
385,270 |
1,156,591 |
|
|
Translation reserve |
873,963 |
155,301 |
|
|
Accumulated loss |
(2,729,301) |
(4,171,602) |
|
|
Equity attributable to equity holders of the parent |
3,162,418 |
3,159,076 |
|
|
Minority Interest |
612,974 |
684,623 |
|
|
Total equity |
3,775,392 |
3,843,699 |
|
|
________ |
________ |
||
|
TOTAL EQUITY AND LIABILITIES |
5,304,577 |
4,486,400 |
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2008
|
Share |
Foreign |
||||||
|
Based |
Accumu- |
Currency |
|||||
|
Share |
Share |
Payment |
lated |
Translation |
Minority |
||
|
Capital |
Premium |
Reserve |
Loss |
Reserve |
Interest |
Total |
|
|
£ |
£ |
£ |
£ |
£ |
£ |
£ |
|
|
Group |
|||||||
|
1 January 2008 |
1,540,333 |
4,478,453 |
1,156,591 |
(4,171,602) |
155,301 |
684,623 |
3,843,699 |
|
Share capital reduction |
(1,386,300) |
- |
- |
1,386,300 |
- |
- |
- |
|
Loss for the year |
- |
- |
- |
(726,309) |
- |
(78,885) |
(805,194) |
|
Share based payment |
- |
- |
10,989 |
- |
- |
- |
10,989 |
|
Reserve transfer |
- |
- |
(782,310) |
782,310 |
- |
- |
- |
|
Movement on currency reserve |
- |
- |
- |
- |
718,662 |
7,236 |
725,898 |
|
31 December 2008 |
154,033 |
4,478,453 |
385,270 |
(2,729,301) |
873,963 |
612,974 |
3,775,392 |
|
Share |
Foreign |
||||||
|
Based |
Accumu- |
Currency |
|||||
|
Share |
Share |
Payment |
lated |
Translation |
Minority |
||
|
Capital |
Premium |
Reserve |
Loss |
Reserve |
Interest |
Total |
|
|
£ |
£ |
£ |
£ |
£ |
£ |
£ |
|
|
Group |
|||||||
|
1 February 2007 |
1,534,083 |
4,447,203 |
916,590 |
(2,025,458) |
(48) |
665,466 |
5,537,836 |
|
Share issue |
6,250 |
31,250 |
- |
- |
- |
- |
37,500 |
|
(Loss) / profit for the period |
- |
- |
- |
(2,404,028) |
- |
18,844 |
(2,385,184) |
|
Share based payment |
- |
- |
497,885 |
- |
- |
- |
497,885 |
|
Reserve transfer |
- |
- |
(257,884) |
257,884 |
- |
- |
- |
|
Movement on currency reserve |
- |
- |
- |
- |
155,349 |
313 |
155,662 |
|
31 December 2007 |
1,540,333 |
4,478,453 |
1,156,591 |
(4,171,602) |
155,301 |
684,623 |
3,843,699 |
CONSOLIDATED CASHFLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2008
|
Year |
Period |
||
|
Ended |
1 February 2007 to |
||
|
31 December 2008 |
31 December 2007 |
||
|
£ |
£ |
||
|
Net cash outflow from operating activities |
(789,956) |
(210,638) |
|
|
Investing activities |
|||
|
Investment income |
1,966 |
55,504 |
|
|
Intangible assets additions |
(301,340) |
(1,488,299) |
|
|
Property, plant and equipment acquired |
(15,463) |
(3,643) |
|
|
________ |
_________ |
||
|
Net cash outflow from investing activities |
(314,837) |
(1,436,438) |
|
|
Financing activities |
|||
|
Issue of equity share capital |
- |
37,500 |
|
|
Loans |
978,019 |
- |
|
|
Loan interest & charges |
(104,901) |
- |
|
|
(Decrease) / increase in bank overdraft |
(3,630) |
3,630 |
|
|
_______ |
______ |
||
|
Net cash inflow from financing activities |
869,488 |
41,130 |
|
|
Net cash decrease in cash and cash equivalents |
(235,305) |
(1,605,946) |
|
|
Cash and cash equivalents at beginning of year/period |
259,276 |
1,865,222 |
|
|
Cash and cash equivalents at end of year /period |
23,971 |
259,276 |
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2008
1. General Information
UMC Energy Plc is a company incorporated in England and Wales under the Companies Act 1985. The Company's registered office is 11 Albemarle Street, London, W1S 4HH.
The principal activity of the Group is the investment in and exploration and development of uranium mining projects, specifically in a uranium exploration project in Madagascar.
The Group's principal activity is carried out in US dollars. The financial statements are presented in pounds sterling as this is the currency of the country (the UK) where the Company is incorporated and its ordinary shares admitted for trading.
2. Accounting policies
Basis of accounting
The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs).
The financial statements have been prepared on the historical cost basis except that certain financial instruments are accounted for at fair values. The principal accounting policies adopted are set out below.
In the previous period the financial year end of the Company has been changed from 31 January 2007 to 31 December 2007 to ensure a co-terminus year end date with its subsidiary undertaking Uramad SA and as such the comparative figures as shown in the financial statements are not comparable with the current period figures.
New standards and interpretations not applied
The IASB has issued the following relevant standards which are not effective and have not been early adopted for these financial statements:
|
Effective date |
|
|
IFRS 2 (amended) Share-Based Payment |
1 January 2009 |
|
IFRS 8 Operating segments |
1 January 2009 |
|
IAS 1 (revised) Presentation of Financial Statements |
1 January 2009 |
|
IAS 16 (amended) Property, plant and equipment |
1 January 2009 |
|
IAS 19 (amended) Employee benefits |
1 January 2009 |
|
IAS 23 (revised) Borrowing costs |
1 January 2009 |
|
IAS 27 (amended) Consolidated and separate financial statements |
1 January 2009 |
|
IAS 38 (amended) Intangible Assets |
1 January 2009 |
The directors do not anticipate that adoption of these standards will have a material impact on the Group and Company's financial position or performance although IAS 1 (revised) will change the manner in which the statements are presented.
Going Concern
The financial statements have been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.
The directors believe that it is appropriate to prepare the financial report on a going concern basis as they are confident that the Company will be able to raise additional funds through further debt or equity raisings when required. The directors are of the opinion that the proposed debt or equity raising measures and the existing cash resources will provide sufficient funds to enable the Company to continue its operations for at least the next twelve months.
3. Loss per share
Loss per share has been calculated by dividing the loss for the year/period after taxation attributable to the equity holders of the parent company of £726,309 (31 December 2007: £2,404,028) by the weighted average number of shares in issue at the year end of 30,806,668 (31 December 2007: 30,792,821).
Diluted loss per share has been calculated using the weighted average number of shares in issue at the year end, diluted for the effect of share options and warrants in existence at the year end of 32,523,142 (31 December 2007: 34,866,229).
4. Cash and cash equivalents
|
Group |
Group |
|
|
31 December 2008 |
31 December 2007 |
|
|
£ |
£ |
|
|
Cash at bank and in hand |
23,971 |
259,276 |
The carrying amount of these approximates to their fair values.
5. Loans
|
31 December 2008 |
31 December 2007 |
|
|
£ |
£ |
|
|
Balance brought forward |
- |
- |
|
Amounts advanced |
873,118 |
- |
|
Loan interest and charges |
104,901 |
- |
|
Exchange movement |
57,607 |
|
|
________ |
_ |
|
|
Balance carried forward |
1,035,626 |
- |
In February 2008 the Company secured an A$0.5 million (£224,000 as translated at 1 February 2008) loan facility from Natasa Mining Limited (formerly Investika Limited). The loan bears interest at 15% per annum on funds drawn, is unsecured and was repayable in August 2008 or immediately upon UMC Energy Plc raising further debt or equity funding. The facility bears a facility fee of A$15,000 (£6,729). The loan was not repaid in August 2008 and with the forbearance of Natasa Mining Limited is repayable under the same terms as the March 2008 loan.
In March 2008 the Company secured a further loan facility from Natasa Mining Limited for an unspecified amount to be used in meeting the Company's working capital requirements, including funds to be expended on the Morondava uranium project. The loan bears interest at 15% per annum on funds drawn, is secured by a negative pledge over the Company's equity interest in Uramad UK Limited and is repayable within 60 days following a demand by Natasa Mining Limited. The facility bears a draw down fee of 3% of funds drawn.
6. Cash flows from operating activities
|
Group |
31 December |
31 December |
|
2008 |
2007 |
|
|
£ |
£ |
|
|
Net loss from operations |
(643,706) |
(2,304,054) |
|
Adjustments for: |
||
|
Share based payments |
10,989 |
497,885 |
|
Impairment to intangible fixed assets |
- |
1,366,338 |
|
Translation and currency movements |
192,736 |
101,165 |
|
Depreciation |
12,679 |
6,326 |
|
________ |
________ |
|
|
Operating cash flows before movements in working capital |
(427,302) |
(332,340) |
|
Increase in trade and other receivables |
(69,263) |
(187,106) |
|
(Decrease) / increase in trade and other payables |
(293,391) |
308,808 |
|
Net cash outflow from operating activities |
(789,956) |
(210,638) |
7. Related party transactions
R Cleary, C Kyriakou and J Reynolds are directors of Natasa Mining Limited (formerly Investika Limited), an Australian company and a shareholder in UMC Energy Plc.
In February 2008 the Company secured an A$0.5 million (£224,000 as translated at 1 February 2008) loan facility from Natasa Mining Limited. The loan bears interest at 15% per annum on funds drawn, is unsecured and was repayable in August 2008 or immediately upon UMC Energy Plc raising further debt or equity funding. The facility bears a facility fee of A$15,000 (£6,729). The loan was not repaid in August 2008 and with the forbearance of Natasa Mining Limited is repayable under the same terms as the March 2008 loan.
In March 2008 the Company secured a further loan facility from Natasa Mining Limited for an unspecified amount to be used in meeting the Company's working capital requirements, including funds to be expended on the Morondava uranium project. The loan bears interest at 15% per annum on funds drawn, is secured by a negative pledge over the Company's equity interest in Uramad UK Limited and is repayable within 60 days following a demand by Natasa Mining Limited. The facility bears a draw down fee of 3% of funds drawn.
As at 31 December 2008, the Company had borrowed A$2,170,033 (£1,035,626) under these facilities. This amount includes interest of A$230,116 (£104,901).
At present, the Company is entirely dependent on funding from Natasa Mining Limited for its continuing operation.
G Bujtor, R Cleary, C Kyriakou and R Shakesby were directors of Toledo Mining Corporation Plc. Toledo Mining Corporation Plc provided support services and staff to the Company at a cost of £49,052 (31 December 2007: £56,944) of which £nil (31 December 2007: £6,082) is outstanding at the year end. The Company provided support services and staff to Toledo Mining Corporation Plc for £nil (31 December 2007: £11,145).
C Kyriakou and J Reynolds are directors of Belitung Zinc Corporation Plc. Belitung Zinc Corporation Plc provided support services and staff to the Company at a cost of £nil (31 December 2007: £4,932). The Company provided support staff and services to Belitung Zinc Corporation Plc for £4,000 (31 December 2007: £4,299).
C Kyriakou is, and R Shakesby was, a director of Tarquin Resources plc. Tarquin Resources Plc provided support services and staff to the Company at a cost of £5,903 (31 December 2007: £3,699). The Company provided support services and staff to Tarquin Resources Plc for £nil (31 December 2007: £4,299).
Capma Pty Limited, a company in which C Kyriakou has an interest, paid expenses on behalf of the Company amounting to £7,129 (31 December 2007: £72,173) of which £1,126 (31 December 2007: £21,413) is outstanding at the year end.
The Company was charged £36,000 (31 December 2007: £33,000) by Resource Capital Partners Inc for the provision of the consultancy services of C Kyriakou.
The Company was charged £12,925 (31 December 2007: £39,998) by Accomplishments Pty Limited for the provision of the services of R Cleary of which £11,667 (31 December 2007: £18,333) was for services as director and £1,257 (31 December 2007: £21,655) was for consultancy services. At the year end the Company owed £nil (31 December 2007: £14,000) to Accomplishments Pty Limited.
The Company was charged £49,415 (31 December 2007: £75,014) by Sedgefield Pty Ltd for the provision of consultancy services of M Smith, of which £nil (31 December 2007: £46,495) is outstanding at the year end.
The Company was charged £nil (31 December 2007:£11,000) by Avventura Commercial Corporation for the provision of services of K Bates as director of which £nil (31 December 2007: £12,000) is outstanding at the year end. Director's fees of £7,000 (31 December 2007: £nil) has been accrued for in relation to K Bates.
The Company was charged £7,000 (31 December 2007: £11,000) by W McKnight for the provision of services as director.
The Company was charged £nil (31 December 2007: £31,336) by S C P Lagral, £nil (31 December 2007: £24,000) for the provision of consultancy services of G Whiddon and £nil (31 December 2007: £7,336) for reimbursed expenses.
The Company was charged £16,330 (31 December 2007: £nil) by G Whiddon, £2,036 for the provision of services as director, £10,003 for the provision of consulting fees and £4,291 for reimbursed expenses.
The Company was charged £25,492 (31 December 2007: £nil) by J Reynolds for the provision of accounting and administration services of which £3,114 is outstanding at the year end.
The Company was charged £3,000 (31 December 2007: £nil) by Shakesby Investments Pty Limited for the provision of the services of R Shakesby as director.
During the year the Company made additional advances to its subsidiary Uramad SA of £585,543 (31 December 2007: £1,366,338) and at the year end Uramad SA owed the Company £2,837,715 (31 December 2007: £1,873,272). Following an impairment review, an impairment adjustment of £nil (31 December 2007: £1,366,338) was recognised.
The Company provided support services and staff to Uramad SA for £1,328 (31 December 2007: £nil).
The Company issued share options to directors. The fair value of these options, £nil (31 December 2007:£484,945) has been charged to the income statement and is also reflected in the share based payments reserve in the balance sheet.
Bernard Furth was a director of Uramad SA and a shareholder in the following companies: Assistance Et Logistique Miniere (ALM Sarl), Zircon Mining Corporation (ZMC Sarl) and Forex Sarl. During the year Uramad SA was charged £53,914 (31 December 2007: £867,649) by ALM Sarl for services rendered and at the year end owed £nil (31 December 2007: £190,232). At 31 December 2008 ZMC Sarl owed Uramad SA £nil (31 December 2007: £5,706) in respect of a payment made on its behalf by Uramad SA. During the year Uramad SA was charged £1,375 (31 December 2007: £260,067) by Forex Sarl for services rendered and at the year end owed £nil (31 December 2007: £9,034).
8. Post balance sheet events
Since 1 January 2009, the Company has advanced a further US$15,548 (£10,687) to Uramad SA, for use on uranium exploration activities.
Since 1 January 2009, the Company has borrowed a further A$180,557 (£83,025) from Natasa Mining Limited, for working capital.
9. Publication of non statutory accounts
The summary accounts set out above do not constitute statutory accounts as defined by Section 240 of the UK Companies Act 1985. The summarised consolidated balance sheet at 31 December 2008 and the summarised consolidated income statement, summarised consolidated statement of changes in equity and the summarised consolidated cash flow statement for the year then ended have been extracted from the Group's 2008 statutory financial statements upon which the auditors' opinion is modified on the basis of an emphasis of matter opinion and going concern. The results for the year ended 31 December 2007 have been extracted from the statutory accounts for that period, which contain a modified auditors' report on the basis of an emphasis of matter opinion and going concern.
10. Annual Report
The Annual Report for the year ended 31 December 2008 will be posted to shareholders shortly. The Annual General Meeting of the Company will be held at 11 Albemarle Street, London W1S 4HH, on 25 June 2009 at 10.00 a.m.
Copies of the report will be available from the Company's registered office at 11 Albemarle Street London W1S 4HH United Kingdom and also from the Company's website www.umc-energy.com.
Related Shares:
UEP.L