Final Results

Mercom Oil Sands plc

("the Company")

Final Results

Mercom Oil Sands plc announces its final results for the year ended 31 March 2015.

Chairman's Statement

I am pleased to present my Chairman's statement for Mercom Oil Sands Plc ("the Company") for the year ended 31 March 2015.

In the year ended 31 March 2014, the Board secured shareholder support for a new strategy to create shareholder value through the investment of the Company's cash assets in the natural resources and energy sectors, with a focus on oil and gas.

On 29 May 2014, the Company announced a range of new investments totaling £768,000, of which £400,000 was invested for a 30% interest in Lion Natural Resources Limited, an unquoted company which holds investments in two companies with projects in Sierra Leone and Kenya; £300,000 was invested for a 35% interest in NWT Coal Limited, an unquoted company with two coal concessions in Vietnam; and a small investment of £68,000 was made in 7% convertible debentures of Maverick Petroleum Ltd, an oil company with a focus in the Republic of Chad. On 30 October 2014, the principal (CAD$125,000) plus accrued interest (CAD$3,750) were converted into 66,026 common shares of Maverick Petroleum Ltd., representing a 2% interest. These investments will be managed with a view to generating returns for shareholders and, as such, investments may be realised from time to time. As a result of these investments, the Company was deemed to have implemented its investing policy for the purposes of Rule 15 of the AIM Rules for Companies. Further information on the Company's investments is set out in the Investment Report.

On 16 July 2014 the Company announced that the Board had decided to proceed with the share capital reorganisation approved at the General Meeting of the Company held on 24 May 2013. This reorganisation, which was completed on 31 July 2014, effectively consolidated every 50 old Ordinary shares of 0.1p each into one new Ordinary share of 0.1p each. The Board considers this will facilitate future investment decisions, and has placed the Company in a position to implement its investment strategy with increasing confidence.

No further investments have yet been made, but the Company is continuing the process of identifying investment opportunities which match our strategy, and of evaluating the potential profitability and risks associated with them. The annual audited accounts accordingly show that the Group had cash reserves of £609,450 at 31 March 2015, after corporate expenses of £275,000 had been incurred during the year (2014: £480,000). Net cash used in operations amounted to £108,019 (2014: £583,014). Our net asset value decreased to £0.12 per share from £0.17 per share in the previous year. Net assets value at 31 March 2015 was £1,428,492 compared to £1,818,865 as at 31 March 2014. The decrease was chiefly the result of the cash used in operations and the £200,000 impairment recorded on the investment in Lion Natural Resources Limited.

On 16 May 2014, the Board accepted the resignation of Albert Taubi as non-executive director, while expressing its gratitude to Mr Taubi for his efforts to promote the interests of Mercom Oil Sands Plc since its incorporation.

Despite the challenging environment in the resources sector, the Directors continue to believe there are opportunities to create value for shareholders.

Dr Patrick Cross

Chairman

30 September 2015

For further information, contact:

Consolidated Statement of Comprehensive Income

For the year ended 31 March 2015

Consolidated Statement of Financial Position

As at 31 March 2015

Company Statement of Financial Position

As at 31 March 2015

Consolidated Statement of Cash Flows

For the year ended 31 March 2015

Company Statement of Cash Flows

For the year ended 31 March 2015

Consolidated and Company Statements of Changes in Equity

For the year ended 31 March 2015

Notes to Consolidated Financial Statements

For the year ended 31 March 2015

1. BASIS OF PRESENTATION

Basis of presentation and statement of compliance

The financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and as adopted by the European Union.

Basis of consolidation

The Group financial statements include the financial statements of the Company and its subsidiary undertaking Mercom Oil Sands Canada Inc., a company incorporated in Canada. The results of subsidiary undertakings sold or acquired are included in the Consolidated Statement of Comprehensive Income up to, or from the date control passes. Intra group sales and profits are eliminated fully on consolidation.

Functional currency

The presentational and functional currency of the Group and Company is U.K Sterling.

Significant accounting estimates and judgments

The preparation of these financial statements requires management to make judgments and estimates that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of expenses during the reporting period. Actual outcomes could differ from these judgments and estimates. The financial statements include judgments and estimates which, by their nature, are uncertain. The impacts of such judgments and estimates are pervasive throughout the financial statements, and may require accounting adjustments based on future occurrences. Revisions to accounting estimates are recognised in the period in which the estimate is revised and the revision affects both current and future periods.

Significant assumptions about the future and other sources of judgments and estimates that management has made at the statement of financial position date, that could result in a material adjustment to the carrying amounts of assets and liabilities, in the event that actual results differ from assumptions made, relate to, but are not limited to, the following:

· The accounting treatment of the available for sale financial assets;

· The valuation of available for sale financial assets;

· The valuation of trade and other receivables; and

· The judgment that significant influence is not exercised by the Group over any of the investments as detailed in note 9.

Going concern

These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") applicable to a going concern, which assume that the Company will be able to realise its assets and discharge its liabilities in the normal course of operations. The Company has no current source of operating revenues and its capacity to operate as a going concern in the near-term will likely depend on its ability to continue raising equity or debt financing. There can be no assurance that the Company will be able to continue to raise funds in which case the Company may be unable to meet its obligations. Should the Company be unable to realise on its assets and discharge its liabilities in the normal course of business, the net realisable value of its assets may be materially less than the amounts recorded in the Consolidated and Company Statements of Financial Position.

The Directors consider that the significant cash expenses held by the Company will be sufficient to continue in operation and meet its liabilities as they fall due for a period of no less than twelve months from the date of approval of these financial statements.

The financial statements do not include adjustments to amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue operations.

2. SIGNIFICANT ACCOUNTING POLICIES

Exploration and evaluation assets

(i) Capitalised costs

Exploration and evaluation expenditures include the costs of maintaining licenses, costs associated with exploration and evaluation activity, and the fair value (at acquisition date) of exploration and evaluation assets acquired in a business combination. Before legal rights to explore an area are obtained, exploration and evaluation expenditures are expensed as incurred. Expenditures associated with the acquisition of exploration and evaluation assets through a business combination or asset acquisition are capitalised and recognised as assets. Exploration and evaluation costs incurred thereafter are capitalised. Capitalised costs, including general and administrative costs, are only allocated to the asset to the extent that these costs can be related directly to operational activities in the relevant area of interest where it is considered likely to be recoverable by future exploitation or sale, or where the activities have not reached a stage which permits a reasonable assessment of the existence of reserves. Costs of extending agreements are not capitalised.

Entities where the Group has a holding of 20% or more but not exercise significant influence are accounted for as available for sale of financial assets.

(ii) Depletion and amortisation

Capitalised costs related to each cost centre from which there is production will be depleted using the unit-of-production method based on proved petroleum and natural gas reserves, as determined by independent consulting engineers. The cost of significant development projects and undeveloped properties will be excluded from costs subject to depletion until it is determined whether or not proved reserves are attributable to the properties or impairment has occurred. Estimated future costs to be incurred in developing proved reserves will be included and estimated salvage values are excluded from costs subject to depletion. In cost centres from which there has been no production, certain costs will not be subject to depletion until commercial production commences. No depletion has been calculated.

(iii) Impairment

Exploration and evaluation assets are assessed for impairment if (i) sufficient data exists to determine technical feasibility and commercial viability, and (ii) facts and circumstances suggest that the carrying amount exceeds the recoverable amount. Once the technical feasibility and commercial viability of the extraction of mineral resources in an area of interest are demonstrable, exploration and evaluation assets attributable to that area are first tested for impairment and then reclassified to mining property and development assets within property, plant and equipment. Recoverability of the carrying amount of the exploration and evaluation assets is dependent on successful development and commercial exploitation, or alternatively, sale of the respective areas of interest.

(iv) Asset retirement obligations

Asset retirement obligations include present obligations where the Group will be required to retire tangible long-lived assets such as producing well sites and facilities. The asset retirement obligation is measured at the present value of the expenditure expected to be incurred using a risk-free discount rate. The associated asset retirement cost is capitalised as part of the cost of the related long-lived asset. Changes in the estimated obligation resulting from revisions to estimated timing, amount of cash flows, or changes in the discount rate are recognised as a change in the asset retirement obligation and the related asset retirement cost. Increases in asset retirement obligations resulting from the passage of time are recorded as accretion of asset retirement obligation in the statement of operations. The Group has not recognised any asset retirement obligations as of 31 March 2015.

Investments

Investments in subsidiaries, associates and joint ventures, and other investments are presented in the Parent financial statements at cost, less any necessary provision for impairment.

Associates

Associates are entities over which the Group exercise significant influence but does not exercise control. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost, which includes goodwill identified on acquisition, net of any accumulated impairment loss. The Group's share of its associate's profits or losses after acquisition of its interest is recognised in profit or loss and cumulative post-acquisition movements are adjusted against the carrying amount of the investment. Where the Group's share of losses of an associate equals or exceeds the carrying amount of the investment, the Group only recognises further losses where it has incurred obligations or made payments on behalf of the associate.

Entities where the Group has a holding of 20% or more but does not exercise significant influence are accounted for as available for sale financial assets.

In respect of the investments detailed in note 9 in all cases the Company has no right to appoint directors and has no ability to influence the strategic and operational decisions taken.

Financial assets

Available for sale financial assets consist of equity investments in other companies or limited partnerships where the Group does not exercise either control or significant influence.

Available for sale financial assets are shown at fair value at each reporting date with changes in fair value being shown in Other Comprehensive Income, or at cost less any necessary provision for impairment where a reliable estimate of fair value is not able to be determined. In cases where the Group can reliably estimate fair value of the available for sale financial assets, fair value will be determined in reference to practical completion of each development project.

All assets for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

· Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities.

· Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

· Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

The valuation technique applied to the available for sale financial assets in the current period is a Level 3 technique.

Corporation tax

Corporation tax on the profit or loss for the period presented comprises current and deferred tax. Corporation tax is recognised in profit or loss except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax expense is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at the period end.

Deferred tax is recorded using the asset and liability method, providing for temporary differences, between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: goodwill not-deductible for tax purposes; the initial recognition of assets or liabilities that affect neither accounting or taxable loss; and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the period end date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. To the extent that the Group does not consider it probable that a future tax asset will be recovered, the tax asset is not recognised.

Corporation tax (continued)

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.

Cash and cash equivalents

Cash and cash equivalents consist of cash on deposit with banks and short-term interest-bearing investments with maturities of 90 days or less from the original date of acquisition. Cash and cash equivalents are recorded at fair value and changes in fair value would be reflected in the Consolidated Statement of Comprehensive Income.

Warrants

Warrants issued to consultants are accounted for using the fair value method and result in share issue costs and a credit to the warrants reserve when the warrants are issued. When warrants are exercised, the corresponding warrant fair value and the proceeds received by the Group are credited to share capital. When warrants expire, the corresponding fair value is credited to accumulated deficit.

Loss per share

Basic loss per share is calculated using the weighted average number of shares outstanding. Diluted loss per share assumes that any proceeds from the exercise of dilutive stock options and warrants would be used to repurchase Ordinary shares at the average market price during the period, with the incremental number of shares being included in the denominator of the diluted earnings per share calculation.

During the year ended 31 March 2015, all issued and outstanding warrants and options were anti-dilutive and were excluded from the diluted loss per share calculations.

Foreign currency translation

The functional and presentational currency of the Group is U.K Sterling. Transactions in currencies other than the functional currency are recorded at the rates of exchange prevailing on dates of transactions. At each period end date monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to U.K Sterling at the exchange rate at that date. Foreign exchange differences arising on translation are recognised in the Consolidated Statement of Comprehensive Income. Non-monetary assets and liabilities that are measured at historical cost are translated using the exchange rate at the date of the transaction.

Impairment of assets

At each period end date, assets are reviewed for impairment if there is any indication that the carrying amount may not be recoverable. If any such indication is present, the recoverable amount of the asset is estimated in order to determine whether impairment exists. Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Any intangible asset with an indefinite useful life is tested for impairment annually and whenever there is an indication that the asset may be impaired.

An asset's recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value, using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset or cash generating unit is estimated to be less than its carrying amount, the carrying amount is reduced to the recoverable amount. Impairment is recognised immediately as additional depreciation. Where an impairment subsequently reverses, the carrying amount is increased to the revised estimate of recoverable amount but only to the extent that this does not exceed the carrying value that would have been determined if no impairment had previously been recognised. A reversal is recognised as a reduction in the depreciation charge for the period.

Share issue costs

Costs incurred for the issue of Ordinary shares are deducted from the share premium arising on that issue.

Revenue recognition

Revenue from the sale of petroleum and natural gas is recognised when the risks and rewards of ownership pass to the purchaser, including delivery of the product, the selling price is fixed or determinable and collection is reasonably assured. Oil and natural gas royalty revenue is recognised when received.

Financial Instruments

Financial assets

The Group classifies its financial assets into one of the following categories, depending on the purpose for which the asset was acquired. The Group's accounting policy for each category is as follows:

Fair value through profit or loss - This category comprises derivatives, or assets acquired or incurred principally for the purpose of selling or repurchasing it in the near term. They are carried in the Consolidated and Company Statements of Financial Position at fair value with changes in fair value recognised in the Consolidated Statement of Comprehensive Income.

Loans and receivables - These assets are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are carried at cost less any provision for impairment. Individually significant receivables are considered for impairment when they are past due or when other objective evidence is received that a specific counterparty will default.

Held-to-maturity investments - These assets are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Group's management has the positive intention and ability to hold to maturity. These assets are measured at amortised cost using the effective interest method. If there is objective evidence that the investment is impaired, determined by reference to external credit ratings and other relevant indicators, the financial asset is measured at the present value of estimated future cash flows. Any changes to the carrying amount of the investment, including impairment losses, are recognised in the Consolidated Statement of Comprehensive Income.

Available-for-sale - Non-derivative financial assets not included in the above categories are classified as available-for-sale. They are carried at fair value with changes in fair value recognised directly in equity. Where a decline in the fair value of an available-for-sale financial asset constitutes objective evidence of impairment, the amount of the loss is removed from equity and recognised in profit or loss.

All financial assets except for those at fair value through profit or loss are subject to review for impairment at least at each reporting date. Financial assets are impaired when there is any objective evidence that a financial asset or a group of financial assets is impaired. Different criteria to determine impairment are applied for each category of financial assets, which are described above.

Financial liabilities

The Group classifies its financial liabilities into one of two categories, depending on the purpose for which the asset was acquired. The Group's accounting policy for each category is as follows:

Fair value through profit or loss - This category comprises derivatives, or liabilities acquired or incurred principally for the purpose of selling or repurchasing it in the near term. They are carried in the Consolidated and Company Statements of Financial Position at fair value with changes in fair value recognised in the Consolidated Statement of Income.

Other financial liabilities - This category includes promissory notes, amounts due to related parties and accounts payables and accrued liabilities, all of which are recognised at amortised cost.

The Group's financial instruments consist of the following:

Cash and cash equivalents Loans and receivables

Other receivables Loans and receivables

Accounts payable and accrued liabilities Other financial liabilities

During the year ended 31 March 2015 the Group adopted a number of new IFRS standards, interpretations, amendments and improvements to existing standards. These included IFRS10, IFRS11, IFRS12, IFRS13 and IAS1. These new standards and changes did not have any material impact on the Company's financial statements.

The following new standards, amendments to standards or interpretations are mandatory for the Group for the first time for the financial year beginning 1 April 2015, but are not currently considered to be relevant to the Group (although they may affect the accounting for future transactions and events):

· IFRS 9, 'Financial Instruments', issued in November 2009 and effective from 1st January 2018. IFRS 9 represents the first phase of the IASB's project to replace IAS 39 'Financial Instruments: Recognition and Measurement'. It sets out the classification and measurement criteria for financial assets and liabilities and requires all financial assets, including assets currently classified under IAS 39 as available for sale, to be measured at fair value through profit and loss unless the assets can be classified as held at amortised cost. Qualifying equity investments held at fair value may have their fair value changes taken through other comprehensive income by election.

· IAS 19 (Revised), 'Employee Benefits' effective for periods beginning on or after 1st July 2014. These amendments are intended to provide a clearer indication of an entity's obligations resulting from the provision of defined benefit pension plan and how those obligations will affect its financial position, financial performance and cash flow.

The following new standards, amendments to standards and interpretations have been issued, but are not effective for the financial year beginning 1April 2015 and have not been early adopted:

· IFRS15, 'Revenue from Contracts with Customers', effective for periods commencing on or after 1st January 2018 but not yet adopted by the EU. This standard replaces IAS18, 'Revenue Recognition' and revenue recognition standards under US GAAP and aims to unify revenue recognition under IFRS and US GAAP. The standard focuses on entitlement to consideration as opposed to percentage completion under existing IFRS and introduces a five step approach to recognising income.

3. CAPITAL AND FINANCIAL RISK MANAGEMENT

The capital of the Group consists of shareholders' equity. The Group's objectives when managing capital are to safeguard the Group's ability to continue as a going concern in order to pursue the development of its financial assets and to maintain optimal returns to shareholders and benefits for other stakeholders.

The Group manages its capital structure and makes adjustments to it in light of changes in economic conditions and the risk characteristics of the underlying assets. To maintain or adjust its capital structure, the Group may attempt to issue new shares or debt, dispose of assets, or adjust the amount of cash and cash equivalents.

Management reviews its capital management approach on an ongoing basis and believes that this approach, given the relative size of the Group, is reasonable. There were no changes in the Group's approach to capital management during the year ended 31 March 2015. The Group is not subject to externally imposed capital requirements.

Credit risk

All the Group's cash and cash equivalents are held with well-known and established financial institutions. As such, management considers credit risk related to these financial assets to be minimal. The Group's maximum credit risk exposure is limited to the carrying value of its cash and subscriptions receivable. At 31 March 2015 the Group had no material amounts deemed to be uncollectible.

Commodity price risk

Commodity price risk is the risk that the fair value of future cash flows will fluctuate as a result of changes in oil and natural gas commodity prices. The nature of the Group's operations will result in exposure to fluctuations in commodity prices. The Group is currently in its development stage and as such the exposure to fluctuations in commodity prices is not actively managed. In the future, the Group may use commodity price contracts to manage exposure to fluctuations in pricing.

Interest rate risk

Interest rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. The Group does not have a material exposure to this risk as there are no outstanding debt facilities.

Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they come due. The Group ensures, as far as possible, that it will have sufficient liquidity to meet its liabilities when due, without incurring unacceptable losses or harm to the Group's reputation.

The Group utilises authorisation for expenditures to further manage capital expenditures and attempts to match its payment cycle with available cash resources.

Foreign currency risk

The Group is exposed to foreign currency fluctuations on its cash which is denominated in U.K. Sterling and Canadian Dollars.

4. LOSS BEFORE TAXATION

5. EXCEPTIONAL ITEM

The exceptional item in the year relates to an impairment against the Company's investment in Lion Natural Resources Limited.

On 28 November 2013, the Company finalised an out of court settlement with Nordic Petroleum ASA with regard to its dispute over the Farm-in agreement. The Company agreed to pay a cash sum, together with the issue of 12,954,545 Ordinary shares (pre consolidation) in the Company, to Nordic Petroleum ASA in full and final settlement of the dispute.

6. EMPLOYEES

7. TAXATION

8. LOSS OF THE PARENT COMPANY

9. INVESTMENTS

Group

a) Available for sale financial assets

The additions represent the investment in the following companies:

The impairment in the year is in respect of Lion Natural Resources Limited as detailed in note 5.

The accounting treatment of the investments in Lion Natural Resources Limited and NWT Coal Limited as available for sale financial assets and not as associates is detailed in note 1. These investments have measured at cost less impairment as also detailed in note 1 as it was not possible to reliably measure a fair value.

The above investments represent the investments as detailed in the Group note a) as detailed above.

. INVESTMENTS (continued)

10. EXPLORATION AND EVALUATION ASSETS

Group and company

In the previous year the Company finalised on out of court settlement with Nordic Petroleum ASA with regard to its dispute over the Farm-in agreement to acquire a 50% working interest in four Alberta Crown Oil Sands Leases 'the Leases'. The cost of the Canadian $100,000 deposit was fully impaired in the year ended 31 March 2013. The deposit has now been disclosed as disposed of as the Company has no further legal rights or obligations in respect of the Leases.

11. TRADE AND OTHER RECEIVABLES

12. TRADE AND OTHER PAYABLES

13. RELATED PARTY TRANSACTIONS AND BALANCES

14. SHARE CAPITAL

The fair value of the warrants issued during the year ended 31 March 2014, was estimated at £62,000 using the Black-Scholes option pricing model with the following assumptions:

Risk free interest rate 1.08 %

Expected dividend yield nil

Expected volatility 100 %

Expected life 3 years

No warrants were issued during the year ended 31 March 2015.

14. SHARE CAPITAL (continued)

c) Share options

On 16 July 2014 the Company granted an option to J. Zorbas, the Company's Chief Executive Officer, to subscribe at any time during the 10 year period from the date of grant for 100,049 (pre-consolidation) Ordinary shares at an exercise price of 0.1p per share (pre consolidation price). J. Zorbas exercised this option and 100,049 Ordinary shares were issued on 16 July 2014 by the Company credited as fully paid.

The fair value of the options issued during the year ended 31 March 2015, was estimated at £nil using the Black-Scholes option pricing model with the following assumptions:

Risk free interest rate 2.20 %

Expected dividend yield nil

Expected volatility 100 %

Expected life 0 years

Option pricing models require the input of subjective assumptions regarding the expected volatility. Volatility is difficult to ascertain given that the company is still in the development stage, therefore it has been set at 100%. Changes in assumptions can materially affect the estimate of fair value, and therefore, the use of the Black-Scholes option pricing model, as required by IFRS, may not provide a realistic measure of the fair value of the Company's warrants and share options at the date of issue.

15. LOSS PER ORDINARY SHARE 

Basic loss per share is calculated by dividing the loss attributable to equity holders of the Company by the weighted average number of Ordinary shares in issue during the period.

Diluted loss per share is calculated by adjusting the weighted average number of Ordinary shares in issue to assume the conversion of all dilutive potential ordinary shares at the start of the period. The Company's dilutive potential Ordinary shares arise from warrants. In respect of the warrants a calculation is performed to determine the number of shares that could have been acquired at fair value, based upon the monetary value of the subscription rights attached to the outstanding warrants. The number of shares calculated as above is compared with the number of shares that would have been issued assuming the exercise of the warrants.

There were no potentially dilutive warrants as the exercise price exceeded the average market price of the Ordinary shares during the period. Any potentially dilutive Ordinary shares would have been anti-dilutive because the Group was loss-making.

16. ULTIMATE CONTROLLING PARTY

In the opinion of the Directors there is no ultimate controlling party.

17. SUBSEQUENT EVENTS

On 6 May 2015, the Company allotted a total of 3,034,886 Ordinary shares at 4.625p per share (being the mid-market closing price at the close of business on 5 May 2015). Of these shares, 440,291 Ordinary shares have been allotted to Dr P.H. Cross in settlement of director's fees and expenses of £20,363 for the period from 1 July 2014 to 30 April 2015 and 2,594,595 Ordinary shares have been allotted to J. Zorbas in settlement of invoices totalling £120,000 in respect of his consultancy contract with the Company, for the period 1 April 2014 to 31 March 2015 and are being settled in shares in order to preserve the Company's cash resources.

**ENDS**