31st Mar 2008 09:49
Aminex PLC31 March 2008 The announcement of Aminex's Preliminary Results for the year ended 31 Decemberunderstated the total amount of Aminex's P50 gas reserves. At the end of theparagraph entitled U.S.A. in the Operations Review, the sentence which reads "Total P50 reserves have now been independently assessed at a valuation of $143million, comprising 6.9 billion cubic feet of gas and 2.3 million barrels of oil" should have read "Total P50 reserves have now been independently assessed at avaluation of $143 million, comprising 28.6 billion cubic feet of gas and 2.3million barrels of oil." The corrected version has been resubmitted below. AMINEX PLC ("Aminex" or "the Company") 28 March 2008 Preliminary results for the year ended 31 December 2007 Aminex, the oil and gas company listed on the London and Irish Stock Exchanges,today announces its preliminary results for the year ended 31 December 2007. Highlights • Net loss US$3.27 million (2006: loss US$2.86 million) • New funds of US$29.3 million (before transaction charges) raised to finance exploration • Significant discovery in Tanzania since the year end • Successful US drilling and material upgrade of US reserves • Drilling ahead on first of three wells in Egypt. Aminex free-carried through first production • Seismic programmes completed in Tanzania, at Ruvuma and Nyuni, and in progress in Madagascar • Licence finalised for two near-shore blocks in Kenya Brian Hall, Chairman of Aminex, said: "2007 saw the launch of a major exploration programme in four countries. Duringthe year we built up our financial strength and set in place the logistics,operations and commercial arrangements for a varied and ambitious explorationprogramme. Since the year end we have announced a significant gas discovery onthe Nyuni licence in Tanzania and announced a further gas discovery in the SouthWeslaco Field in Texas. With an ongoing drilling programme in Egypt, a majorgas exploration well planned in Texas at Alta Loma this year and plans in handfor drilling in the highly prospective Ruvuma Basin of Tanzania at the start of2009, we expect to maintain the momentum of our current operations" Enquiries: Aminex PLC +44 (0) 20 7291 3100Brian Hall - ChairmanSimon Butterfield - Finance Director Pelham Public Relations +44 (0) 20 7743 6679Archie Berens Websitewww.aminex-plc.com Dear Shareholder, Below please find Aminex's preliminary financial results and accompanyingstatement in respect of the year ended 31 December 2007. OVERVIEW 2007 was a period of high activity for Aminex as we built up our financialstrength and set in place the logistics, operations and commercial arrangementsfor a varied and ambitious exploration programme. We raised $29 million in new equity, through an Institutional Placing and aRights Issue to existing shareholders, to finance our exploration programme inEast Africa and the U.S.A. A rig was contracted for Tanzania in April and inthe fourth quarter the first of two exploration wells on the Nyuni licence wasspudded. After a disappointing first well, the second well, Kiliwani North-1,has encountered a significant gas formation since the year end which is nowbeing evaluated. In the USA, the GU-38 well at South Weslaco, spudded justbefore the year end, encountered a thick section of gas bearing sands in January2008. During the year under review seismic was acquired at Nyuni (Tanzania),Manja (Madagascar) and Ruvuma (Tanzania). With the exception of the well atSouth Weslaco, all these projects have been operated and managed by Aminex'sexploration team. At Nyuni (Tanzania) two farm-outs were concluded in early2007, to RAK Gas and to Key Petroleum, while Tullow Oil completed its farm-inobligations at Ruvuma (Tanzania) to earn 50% in that PSA (Production SharingAgreement). Late in the year a PSA was signed with the Government of Kenya fortwo offshore/coastal exploration blocks in the vicinity of Mombasa. Higher oilprices from our U.S. production and a good performance by our oilfield supplyand logistics subsidiary made a strong contribution. Nearly half the net lossfor the year represents a non-cash charge required to be made under currentaccounting rules for the issue of executive share options. Without thisnon-cash charge in each of 2006 and 2007, an improving picture year on yearwould be apparent. FINANCIAL REVIEW All figures are expressed in US Dollars. At $9.3 million, Aminex's totalrevenues were almost double those of 2006. This increase is partly due tohigher sales of goods and services by AMOSSCO, the Group's oilfield services andsupply arm while revenues from oil and gas sales were 10% ahead of 2006. Gas production at 141 million cubic feet was 9% above the 2006 volume, mainlydue to the Sunny Ernst well at Alta Loma being on constant production sinceFebruary 2007. Gas was also produced throughout the year from the South Weslacofield. The average gas price achieved was $6.40/mcf, an increase of 49 centsover the 2006 average. Oil production at 29,000 barrels was comparable to the2006 production level. The average oil price achieved during 2007 was $64.97/barrel, an increase of $6.62 per barrel over 2006. Approximately two thirds ofAminex's oil comes from the Somerset Field which is classified as South TexasSour and priced at a discount to the U.S. bench mark crude, West TexasIntermediate (WTI). Oil was produced throughout the year from the Shoats Creekfield at WTI prices. Cost of sales at $7.4 million was $4 million higher than in 2006 mainly due tothe higher proportion of sales of oilfield services and supplies. Included inthese sales was procurement of oilfield equipment for the Tanzanian drillingprogramme. Cost of sales for oil and gas activities (included in the total costof sales charge of $7.4 million) amounted to $1.45 million, an increase of 8%over 2006. The depletion and decommissioning charge of $449,000 is slightlyabove the 2006 charge of $386,000 as a consequence of higher gas production.After taking into account cost of sales and depletion-decommissioning charges,the resulting gross profit was $1.49 million, a 21% increase over the 2006 grossprofit of $1.23 million. Group administrative expense at $4.97 million was approximately $1 millionhigher than 2006. Included in the 2007 charge was an amount of $1.34 millionrepresenting the notional cost of the award of share options whereas the 2006comparative charge only included $540,000. A large proportion of Aminex'sadministrative expense is incurred in sterling so that the depreciation of the £/$ exchange rate from an average £1/$1.84 in 2006 to £1/$1.99 during the currentreporting period has translated into a higher US dollar charge. Thedepreciation charge at $90,000 is double the 2006 figure, due to new mobileoilfield equipment acquired for the Somerset field during the current period.The resulting net loss from operating activities amounts to $3.57 million, anincrease of $781,000 over 2006. After taking into account net finance income of $299,000 (2006: net financecost $75,000), the resulting net loss for the year ended 31 December 2007 was$3.27 million, an increase over 2006 of $407,000. Balance sheet total non-current assets have increased by $10.1 million over theperiod-end 2006 figure and mainly comprise $9.97 million of additions toexploration and evaluation assets. This represents the cost of seismic workcarried out on the Ruvuma and Madagascar licences as well as drilling activitieson the two Kiliwani wells at Nyuni. Property, plant and equipment showed a netdecrease of $228,000 from 2006 but this is stated net of the depletion anddecommissioning charge of $449,000 as well as net of a reduction of $1.06million in the Group's abandonment provision as a consequence of the re-timingof abandonment activities at the Somerset field, resulting in a 2007 expenditureof $1.28 million. Included in this expenditure is the completion and tie-in toproduction of the third well and the drilling of a fourth well at South Weslaco. The increase of $395,000 in Other Investments represents the Group'sinvestment in Key Petroleum Ltd acquired as part of a farm-out arrangement.Current assets have increased by $18.8 million, $15 million of which isrepresented by cash. Current liabilities have increased by $4.98 million,mostly being for drilling and seismic acquisition activities in Tanzania andMadagascar. Non-current liabilities have decreased by $741,000 due to changesto the Group's abandonment provision referred to earlier. Net debt (current andnon-current) representing U.S. vehicle equipment loans stood at $241,000 at 31December 2007, an increase of $96,000 over 2006. The Group's cash flow statement reflects the proceeds from the issue of sharecapital through a placing and rights issue in mid-year which raised $29.3million before transaction charges of $2.94 million. After taking into accountnet capital expenditures and cash outflows from operating activities, togetheramounting to $11.5 million, the net increase in cash at year end amounted to$14.99 million, which when added to an opening cash balance of $3.6 millionresulted in a year end cash balance of $18.6 million. OPERATIONS REVIEW Tanzania - Nyuni The Caroil-6 land drilling rig was delayed on a previous well and delivered toAminex and partners so late that a two-well programme on the Nyuni licence onlycommenced in November. The first well, Kiliwani-1, was drilled at a 40 degreeangle from the small island of Kiliwani but did not encounter any commercialhydrocarbons in the targeted Neocomian formation. This well was plugged andabandoned in February 2008 and the rig moved a short distance north toSongo-Songo Island. Since the year end the Caroil-6 has successfully drilled avertical well from Songo-Songo, Kiliwani North-1, which intercepted and logged asignificant gas bearing formation of approximately 60 metres gross thickness inLower Cretaceous sands. Although this well has been drilled since the periodunder review, it is a significant event for Aminex, being the first real fruitof several years work on the East African margin. This is of importance notonly for Aminex but also for the prospectivity of the whole region. Thediscovery is currently being evaluated and future plans formulated. Aminex has40% of the Nyuni licence and is the operator. Tanzania - Ruvuma The planned seismic programme for the Lindi and Mtwara licences, which make upthe 12,000 km(2) Ruvuma PSA area, was completed in late 2007 and the processeddata is currently being evaluated and interpreted. Our 50% partner, Tullow Oil,has now earned its farm-in interest and, per agreement, took over operatorshipof the PSA on 1 January 2008. Two initial wells are planned for this licenceand the most likely start date for the drilling programme is 1 January 2009,although this may occur before or after that date. Aminex considers the Ruvumalicences to be highly prospective for both oil and gas and looks forward toputting the prospects which we have now identified to the test with the drillbit. In the Mozambique part of the Ruvuma basin, to the south of the Ruvumariver, a number of international companies are preparing for an intenseexploration effort. The Aminex/Tullow joint venture holds the exclusiveexploration rights to virtually the entire Tanzanian section of this basin. Madagascar Aminex and its 50-50 partner Mocoh Resources Ltd., operating through a jointcompany known as Amicoh Resources Ltd., are currently in the process ofacquiring 500 kms of new 2D seismic data on the 10,750 km(2) Manja PSA (Block3108) onshore on the west coast of Madagascar. The programme is about 50%complete but operations are currently suspended during the rainy season whenswollen rivers and soft ground make it impossible for seismic crews to operate.Acquisition of the remaining data is due to recommence around 1 May 2008 andshould take about 2 months to complete. By end November 2008 a decision must betaken either to extend the licence into a further period which will involve acommitment to drill one well or to surrender the licence. Madagascar hasrecently attracted significant interest from international explorers but remainsa physically and environmentally challenging environment for oil and gasoperations. Kenya In late 2007 a formal PSA was signed with the Government of Kenya for theexploration rights over contiguous coastal blocks L17 and L18, mainly offshorebut with an onshore coastal fringe. These two blocks cover over 5,000 km(2) andstretch from the Tanzanian border in the south to north of the Kenyan port cityof Mombasa. New seismic has already been acquired over the PSA area which hasidentified several interesting leads, offering the prospect of gasaccumulations. Mombasa is an important city and suffers from serious energyshortages so a gas discovery in the vicinity would find a ready market. Seabedcore samples have been taken which indicate the presence of hydrocarbons. Theimmediate programme is to increase the seismic coverage through furtheracquisition and this may take place in September 2008 subject to availability ofan appropriate seismic vessel. Aminex has a 25% interest and is the nominatedoperator. Egypt Aminex Petroleum Egypt Ltd. operates the 1,400 km(2) West esh el Mellahah-2 PSA(WEEM-2) in the onshore Gulf of Suez region close to the coastal town ofHurghada. "Esh el Mellahah" means literally "cluster of salt beds". WEEM-2 isin a mature oil producing area and oilfields in the adjacent WEEM-1 licencetogether produce around 10,000 barrels of oil per day. The geology is highlyfaulted and difficult to interpret but WEEM-2 enjoys extensive 3D seismiccoverage. Since the year end a drilling rig has been mobilised to WEEM-2 andthe first of three commitment wells, Malak-1, was spudded in late February todrill to a target depth of 3,800 metres. At the time of writing Malak-1 had notyet reached target depth but was making good progress. Following Malak-1 afurther two exploration wells are planned and must be drilled by mid 2009 inorder to fulfil the PSA obligations. The second well will be drilledimmediately after Malak-1 but the timing of the third and possibly more wellshas not yet been determined. Aminex has a 10% interest in this PSA and itsshare of costs is carried by other partners until first commercial productionhas been established. Aminex is participating in a promising explorationdrilling programme with no financial exposure until commercial production hasbeen established. U.S.A. Aminex has interests in four principal producing locations: Alta Loma, ShoatsCreek, South Weslaco and Somerset. The results of an updated independentreserves evaluation have been released today and have been posted in summaryform to our website. With recent drilling success, satisfactory and continuousproduction history in 2007 and strengthening oil prices, the updated reportshows a 66% increase over last year's valuation on a P50 basis. Total P50reserves have now been independently assessed at a valuation of $143 million,comprising 28.6 billion cubic feet of gas and 2.3 million barrels of oil. Alta Loma (Galveston County, Texas) produces from a single gas well and afurther deep exploration well is planned. This well was part of Aminex's 2007programme but was delayed due to the takeover of the field operator by anothercompany. El Paso Exploration & Production, a deep drilling specialist, is nowthe operator of the leases and it is expected that a well location will befinalised by the partners and a new well spudded during the first half of 2008.Aminex has a 37.5% net revenue interest in this property. Aminex and partners are involved in a continuous drilling programme in the SouthWeslaco Field (Hidalgo County, Texas). The most recent well, GU-38, was spuddedat the end of 2007 and encountered an important gas formation at the beginningof 2008. South Weslaco wells normally find multiple producing sands and the twomost recent wells, GU-37 and GU-38, were drilled deeper than earlier wells totest lower Frio sands. This strategy has been successful but the sandformations encountered at depth tend to be "tight" and hard to make flow. Afterseveral attempts at conventional stimulation the GU-37 well was successfullyfracture treated (frac'd) and is now on commercial production. The GU-38 willalso require fracture treatment and this is likely to be carried in the nearfuture. Frac-ing is a relatively risky operation and is not normally employeduntil the alternatives have been exhausted. There is an ongoing programme offurther development drilling at South Weslaco in 2008. Further well workovers have been carried out at Shoats Creek (Calcasieu Parish,Louisiana) and we are due to receive the delayed results of Forest Oil's 3Dsurvey, to which we are entitled, around the middle of this year. Shooting 3Dseismic in a swampy, forested area such as Shoats Creek is an operationalchallenge and has taken Forest Oil longer than they anticipated. There ispotentially more underlying value in Shoats Creek than in all our other USproperties combined and the 3D seismic should be the first pointer to unlockingits full potential. Stripper production at Somerset (San Antonio, Texas) has been maintained withcareful management and is fully economic in the present oil price regime. North Korea Turbulent politics and personnel changes at the higher levels of government havemitigated against any serious progress in North Korea during 2007. Our originalagreement negotiated in 2004 was for 20 years and remains valid. We are in theprocess of broadening our relationships with the authorities and we believestrongly in the country's potential for significant hydrocarbon exploitation. AMOSSCO AMOSSCO (Aminex Oilfield Service & Supply Company) is a long-established Aminexsubsidiary which sources and supplies oilfield materials and consumables tointernational oil companies and state procurement organisations. In addition tothird party business, AMOSSCO acts as Aminex's in-house supply and logistics armfor drilling operations. In 2007 the business grew in line with market activityand was also fully involved in supporting the Tanzanian drilling programme. STRATEGY & PROSPECTS Aminex is now fully embarked on the exploration programme predicted this timelast year. High oil prices bring their own problems because in an overheatedmarket equipment and specialist personnel are more expensive and less readilyavailable than at other times and this means that we cannot always meet thedeadlines that we target. Recent drilling success in Tanzania vindicates ourwork there over several years as an early pioneer in East Africa and encouragesus to pursue our East African prospects with renewed vigour. We will evaluatethe recent Kiliwani North discovery with a view to commercial exploitation assoon as possible and will use the knowledge gained from the two wells we haverecently drilled on Nyuni to re-evaluate the other exploration prospects on thelicence. The Egyptian drilling programme is now under way to test multipleprospects. The next major well we are likely to drill will be a deep well atAlta Loma, Texas, which should spud in the first half of this year. Lookingbeyond that we are expecting to be drilling in the Ruvuma Basin (Tanzania)within the next twelve months. We have an exciting portfolio of internationalexploration acreage and with our current programme we are aiming to transformAminex while also remaining alert to other worldwide opportunities. Full creditis due to our technical and operational teams for the progress we have made overthe last year. Yours sincerely. Brian HallChairman 28 March 2008 Group Income Statementfor the year ended 31 December 2007 Notes 2007 2007 2006 2006 US$'000 US$'000 US$'000 US$'000 Revenue 2 9,304 5,019Cost of sales (7,363) (3,401)Depletion, depreciation and decommissioning (449) (386)of oil and gas assets (7,812) (3,787)Gross profit 1,492 1,232Administrative expenses (4,970) (3,974)Depreciation (90) (45) (5,060) (4,019)Loss on operations (3,568) (2,787)Finance income 3 494 165Finance costs 4 (195) (240) Loss before tax (3,269) (2,862)Income tax expense - - Loss for the financial year attributable to 2 (3,269) (2,862)equity holders of the Parent CompanyBasic and diluted loss per Ordinary Share 5 (1.58) (1.74)(in US cents) Group Statement of Recognised Income and Expensefor the year ended 31 December 2007 2007 2006 US$'000 US$'000 Currency translation differences 189 14 Net gain recognised directly in equity 189 14Loss for the financial year (3,269) (2,862) Total recognised income and expense for the (3,080) (2,848)year attributable to the equity holders ofthe Parent Company Group Balance Sheetat 31 December 2007 Notes 2007 2006 US$'000 US$'000AssetsExploration and evaluation assets 6 27,037 17,065Property, plant and equipment 9,196 9,424Other investments 813 418Total non current assets 37,046 26,907Inventory 98 -Trade and other receivables 5,212 1,532Cash and cash equivalents 18,642 3,648Total current assets 23,952 5,180Total assets 60,998 32,087 LiabilitiesCurrent liabilitiesInterest bearing loans and borrowings (95) (43)Trade and other payables (6,138) (1,116)Decommissioning provision (105) (194) Total current liabilities (6,338) (1,353) Non current liabilitiesInterest bearing loans and borrowings (146) (102)Decommissioning provision (1,398) (2,183) Total non current liabilities (1,544) (2,285) Total liabilities (7,882) (3,638) Net assets 53,116 28,449 Equity Issued capital 7 17,835 11,916Share premium 7 59,719 44,010Capital conversion reserve fund 234 234Share option reserve 2,065 729Share warrant reserve 5,682 899Foreign currency translation reserve 128 (61)Retained earnings (32,547) (29,278) Total equity 53,116 28,449 Group Statement of Cashflowsfor the year ended 31 December 2007 2007 2006 US$'000 US$'000Operating activitiesLoss for the financial year (3,269) (2,862)Depletion, depreciation and decommissioning 539 431Foreign exchange losses 195 20Financing income (494) (165)Financing costs 195 240Gain on sale of plant and equipment (2) (11)Impairment provision against listed investment 111 -Equity-settled share-based payment charge 1,336 542Increase in inventory (98) -(Increase)/decrease in trade and other receivables (4,206) 2Increase/(decrease) in trade and other payables 3,607 (398) Net cash absorbed by operations (2,086) (2,201)Cost of decommissioning (15) (165)Interest paid (18) (12)Tax paid - - Net cash outflows from operating activities (2,119) (2,378) Investing activities Acquisition of property, plant and equipment (1,355) (1,986)Expenditure on exploration and evaluation assets (8,776) (1,548)Acquisition of investment assets (5) -Proceeds from sale of property, plant and equipment 288 45Interest received 470 192 Net cash outflows from investing activities (9,378) (3,297) Financing activitiesProceeds from the issue of share capital 29,330 5,708Payment of transaction costs (2,935) (279)Loans repaid (52) (42)Loans received 148 52 Net cash inflows from financing activities 26,491 5,439 Net increase/(decrease) in cash and cash equivalents 14,994 (236)Cash and cash equivalents at 1 January 3,648 3,884 Cash and cash equivalents at 31 December 18,642 3,648 Notes to the Financial Informationfor the year ended 31 December 2007 1 Statement of Accounting Polices The financial information has been prepared in accordance with the recognitionand measurement principles of all International Financial Reporting Standards(IFRS), including Interpretations issued by the International AccountingStandards Board ("IASB") and its committees and endorsed or expected to beendorsed by the European Commission. The accounting policies used are consistent with those set out in the auditedAnnual Report for the year ended 31 December 2006, which is available on theCompany's website, www.aminex-plc.com. 2 Segmental Information The Group's primary reporting format is geographical segments, being America,Africa, Asia and Europe. The Group's other operations by geographical segmentdo not currently represent 10% or more of the Group's revenue or assets and havetherefore not been separately disclosed. The Group's secondary reporting formatis by business segment, being (a) exploration and evaluation, (b) producing oiland gas properties and (c) the provision of oilfield goods and services. The Group's revenues and profits arise from oil and gas production in the USAand the provision of oilfield equipment and services in Europe. Segment results, assets and liabilities include items directly attributable toeach segment as well as items that can be allocated on a reasonable basis.Inter-segment revenue is not material and has therefore not been disclosedseparately below. Net assets before borrowings have been adjusted to eliminatethe impact of intercompany financing. Segment capital expenditure is the total amount of expenditure incurred duringthe period to acquire segment assets that are expected to be used for more thanone period. Segmental revenue Continuing operations Producing Provision of Total Oil and gas Oilfield properties goods and services 2007 2006 2007 2006 2007 2006 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000Country of destinationAmerica 2,759 2,512 141 159 2,900 2,671Africa - - 4,202 268 4,202 268Asia - - 2,001 509 2,001 509Europe - - 201 1,571 201 1,571 Revenue 2,759 2,512 6,545 2,507 9,304 5,019 No revenue arose from exploration activities. 2 Segmental Information (continued) 2007 2006 US$'000 US$'000Segment net profit/(loss) for the yearUS - producing assets 12 144Africa and Asia - exploration assets (545) (419)Europe - oilfield services and supplies assets 361 169Europe - group costs (3,097) (2,756) Total Group net loss for the year (3,269) (2,862) Segment assetsUS - producing assets 9,502 9,445Africa and Asia - exploration assets 33,064 17,478Europe - oilfield services and supplies assets 1,052 289Europe - group assets 17,380 4,875 Total assets 60,998 32,087 Segment liabilitiesUS - producing assets (1,870) (2,979)Africa and Asia - exploration assets (5,132) (84)Europe - oilfield services and supplies (544) (163)Europe - group activities (336) (412) Total liabilities (7,882) (3,638) Capital expenditureUS - producing assets 1,271 1,295Africa and Asia - exploration assets 10,726 1,416Europe - group assets 126 228 Total capital expenditure 12,123 2,939 US depletion and decommissioning charge 449 386 Depreciation - Group assets 90 45 3 Finance income 2007 2006 US$'000 US$'000 Deposit interest income 494 165 4 Finance costs 2007 2006 US$'000 US$'000 Bank loans and overdraft interest 1 1Other finance charges 17 11Other finance costs - decommissioning provision interest 177 228charge 195 240 5 Loss per Ordinary Share The basic net loss per Ordinary Share is calculated using a numerator of the netloss for the financial year and a denominator of the weighted average number ofOrdinary Shares in issue for the financial year. The diluted net loss perOrdinary Share is calculated using a numerator of the net loss for the financialyear and a denominator of the weighted average number of Ordinary Sharesoutstanding and adjusting for the effect of all potentially dilutive shares,including share options, assuming that they had been converted. The calculations for the basic net loss per share for the years ended 31December 2007 and 2006 are as follows: 2007 2006 Net loss for the financial year (US$'000) (3,269) (2,862) Weighted average number of Ordinary Shares ('000) 206,769 164,289 Basic loss per Ordinary Share (US cents) (1.58) (1.74) There is no difference between the net loss per Ordinary Share and the dilutednet loss per Ordinary Share for the years 31 December 2007 and 2006 as allpotentially dilutive Ordinary Shares outstanding are anti-dilutive. There were14,596,000 anti-dilutive share options and 36,526,673 anti-dilutive sharewarrants in issue as at 31 December 2007. 6 Exploration and evaluation assets Tanzania Madagascar Other Total US$'000 US$'000 US$'000 US$'000 Cost and net book valueAt 1 January 2007 16,328 349 388 17,065Additions 6,932 2,819 550 10,301Employment costs capitalised 288 115 - 403Increase in decommissioning cost 21 - - 21Consideration received from joint venture partners (753) - - (753) At 31 December 2007 22,816 3,283 938 27,037 7 Issued capital and share premium Issued Share Capital Premium US$'000 US$'000 At 1 January 2007 11,916 44,010Proceeds from placing net of issue costs 4,499 10,659Proceeds from rights issue net of issue costs 1,196 3,468Proceeds from placing net of issue costs 224 683Transfer from share warrant reserve on lapse of warrants - 899 17,835 59,719 At 31 December 2007 8 Going concern The directors have given careful consideration to the Group's ability tocontinue as a going concern. The directors have concluded that a continuance ofsuch a position will be dependent on a successful sale of assets or analternative method of raising working capital. The directors have a reasonableexpectation that the group will be able to implement this strategy. We understand it is the auditor's intention, as in prior years, to include anEmphasis of Matter paragraph in their audit report on the consolidated financialstatements for the year ended 31 December 2007 drawing attention to this matter.We understand that their opinion will not be qualified in this respect. 9 2007 Annual report and accounts The 2007 annual report and accounts will be posted to shareholders shortly. 10 Statutory information The financial information set out above does not constitute the Company'sstatutory accounts for the year ended 31 December 2007 within the meaning of theCompanies (Amendment) Act, 1986. The statutory accounts will be finalised onthe basis of the financial information presented by the Directors in thepreliminary announcement and together with the independent auditor's reportthereon will be delivered to the Registrar of Companies following the Company'sAnnual General Meeting. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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