12th Dec 2016 10:11
TRICOR PLC (the "Company")
Unaudited Interim Results for the six months ended 30 September 2016
CHAIRMAN'S STATEMENT
Introduction
Tricor Plc ("Tricor", the "Company" or the "Group") is an AIM-listed company which has made investments in Tricor Environmental Pte Ltd ("TEPL"), Tricor Minerals Pte Ltd ("TM"), and Tricor Resources Trading Pte Ltd ("TRT"). Over the 6 months ended 30 September 2016, the Group operating loss was £275,000, compared with a loss of £365,000 for the comparable period in FY2015.
Tricor Environmental Pte Ltd ("TEPL")
Over the 6 months ended 30 September 2016, TEPL incurred a net loss of £33,618. The loss was mainly due to the expenses incurred to maintain the equipment and site whilst the management seeks to secure the sand contracts. TEPL is still attempting to secure new sand contracts. So far, none have been concluded.
As announced on 3 October 2016, TEPL entered into a new operating arrangement with KGGD Pte Ltd ("KGGD"), whereby upon securing the Mineral Processing Permit ("MPP"), TEPL agreed to grant KGGD a one-year, royalty free, sole and exclusive right and license to own and operate an iron sand processing plant on the Bangan Sub-Concession to extract iron sand therefrom and to process, export and sell any product from the date that TEPL obtains an MPP. TEPL and KGGD agreed to operate on a 50/50 profit sharing basis during the one-year period, the extension of which will be dependent on the performance of KGGD during the year. KGGD will operate the Bangan Sub-Concession strictly in accordance with the conditions imposed by the MPP, and, subject to the conditions of the MPP, KGGD will have the right to increase its production as it chooses.
Tricor Minerals Pte Ltd ("TM")
The net profit of TM for the 6 months ended 30 September 2016 was £3,412. The profit was mainly due to gains relating to foreign exchange.
TM, with the help of TEPL, continued to work on its applications for the necessary permits to operate the iron sand processing plant on the Bangan Sub-Concession, however, it is not certain that the necessary permits will be granted by the authorities.
As announced on 3 October 2016, at the General Meeting of the Company held on 30 September 2016, the Tricor shareholders agreed to transfer the ownership of TMPL's iron sand processing plant and related equipment to KGGD in exchange for KGGD and Dunamis Mining Pte Ltd's agreement to write off the entire amount owed by TMPL to both KGGD and Dunamis Mining Pte Ltd in relation to the amount Tricor owed to them in the form of loans and payables as of 3 October 2016, totalling approximately USD$1.3 million.
Tricor Resources Trading Pte Ltd ("TRT")
TRT was set up to be a resources trading company and will only commence business after TM starts producing iron sand.
TRT made a loss of £303 for the 6 months ended 30 September 2016.
The Group's Current Operations
Following the completion of the disposal of TM's iron sand processing plant and related equipment to KGGD, TEPL continues to work with its operating partner, Chahaya, to attempt to secure reclamation sand contracts. In addition, TEPL continues to work with TM to try to secure the MPP. Once the MPP application is approved, TEPL and KGGD will work on the iron sand operation on a 50/50 profit sharing basis. TRT will remain dormant until the iron sand operation commences.
Post-disposal of the iron sand processing plant and related equipment on 3 October 2016, pursuant to Rule 15 of the AIM Rules for Companies (the "AIM Rules"), the Company has been classified as an AIM Rule 15 cash shell. The Company will be required to make an acquisition or acquisitions which constitute a reverse takeover transaction under the AIM Rules within six months of becoming an AIM Rule 15 cash shell (deemed to be the date of completion of the disposal) or be re-admitted to trading on AIM as an investing company under the AIM Rules (which requires the raising of at least £6 million), failing which, the Ordinary Shares would then be suspended from trading on AIM. After six months of suspension, the Ordinary Shares would then be cancelled from trading on AIM.
The Company is currently in ongoing discussions with a number of potential reverse takeover targets. The Board believes that there is a reasonable chance that the Company will undertake a reverse takeover before it is suspended. Consequently, at this time, the Board does not have plans to re-admit the Company to trading on AIM as an investing company.
Summary of the Consolidated Results
The Group did not generate any revenue in the 6 months ended 30 September 2016 (2015: £0) as its operational subsidiaries are still in the midst of attempts to secure new reclamation sand contracts and the necessary permits to operate an iron sand processing plant in Bangan Sub-Concession.
During the period, the Group incurred a total of £248,000 administrative expenses (2015: £378,000).
The Company's cash balance at the end of the period was £9,000, an increase of £8,000 from the position at 31 March 2016. This was mainly due to the drawdown of working capital facility provided by Reed Works Limited.
Update on VAT Claims
As announced on 18 August 2016, the Company was informed that the Upper Tribunal (Tax and Chancery Chamber) had rejected the Company's appeal to reclaim £1,847,976.70 of input VAT plus any interest and costs.
On 15 September 2016, the Company announced that it will accept an application for costs from Her Majesty's Revenue and Customs ("HMRC") of the First Tier Tribunal proceedings. The amount is still undetermined and the Company is under no obligation to accept the amount once received.
On 20 September 2016, the Company announced that it will not appeal the decision of the Upper Tribunal and it will accept the liability for the costs incurred by HMRC in relation to the appeal proceedings at Upper Tribunal. The lawyers representing the Company are currently negotiating the costs applied with the legal representatives of HMRC, the quantum of such costs will be subject to agreement between the parties, any default of which will be assessed by the court.
In relation to the prospective liability for the costs incurred by HMRC for the legal costs, the Company has made a provision of £100,000 in the Company's accounts.
The Company will make any further announcements as appropriate.
Tan Bien Kiat Interim Chairman
12 December 2016 Enquiries:
Consolidated Statement of Comprehensive Income for the six months ended 30 September 2016
| |||||||
| Six months to | Six months to | Year ended | ||||
| 30 September 2016 | 30 September 2015 | 31 March 2016 | ||||
| Unaudited | Unaudited | Audited | ||||
| £'000s | £'000s | £'000s | ||||
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Turnover | - | - | -
| ||||
Cost of sales | (32)
| - | (77)
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| ──────── | ──────── | ─────── | ||||
Gross Profit | - | -
| (77) | ||||
|
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| |||||
Administrative expenses | (248) | (378) | (766) | ||||
Impairment loss on property, plant and equipment | - | - | (506) | ||||
Write-off of other receivables | - | - | (905) | ||||
Finance costs | - | - | - | ||||
| ──────── | ──────── | ──────── | ||||
Operating Loss | (280) | (378) | (2,254) | ||||
Other income | 5 | 13 | 35 | ||||
| ──────── | ──────── | ──────── | ||||
Loss before Tax | (275) | (365) |
| ||||
Income tax charges |
| - | - | ||||
| ──────── | ──────── | ──────── | ||||
Loss for the period | (275) | (365) | (2,219) | ||||
| ──────── | ──────── | ──────── | ||||
Other comprehensive income |
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Items that may be reclassified subsequently
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to profit or loss: |
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Foreign currency translation differences | (339) | 21 | (138) | ||||
| ──────── | ──────── | ──────── | ||||
Other comprehensive income, net of tax | (339) | 21 | (138) | ||||
| ──────── | ──────── | ──────── | ||||
Total comprehensive income for the period Period | (614) | (344) | (2,357) | ||||
| ═══════ | ═══════ | ═══════ | ||||
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(Loss)/Profit attributable to: |
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|
| ||||
Owners of the parent | (276) | (368) | (2,222) | ||||
Non-controlling interest | 1 | 3 | 3 | ||||
| ──────── | ──────── | ──────── | ||||
Loss for the period | (275) | (365) | (2,219) | ||||
| ──────── | ──────── | ──────── | ||||
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Total comprehensive income attributable to: |
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|
| ||||
Owners of the parent | (551) | (330) | (2,327) | ||||
Non-controlling interest | (63) | (14) | (30) | ||||
| ──────── | ──────── | ──────── | ||||
| (614) | (344) | (2,357) | ||||
| ═══════ | ═══════ | ═══════ | ||||
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Loss per share
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| ||||
From continuing operations:
|
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|
| ||||
- Basic earnings per share | (0.15p) | (0.24p) | (1.3p) | ||||
- Diluted earnings per share | (0.15p) | (0.24p) | (1.3p) | ||||
| ═══════ | ═══════ | ═══════ | ||||
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Consolidated Statement of Financial Position as at 30 September 2016
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| 30 September 2016 | 30 September 2015 | 31 March 2016 |
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| Unaudited | Unaudited | Audited |
|
| £'000s | £'000s | £'000s |
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Assets |
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|
Non-current assets |
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|
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|
Intangible assets | - | - | - |
|
Property, Plant & Equipment | - | 609 | - |
|
Non-current other receivables | - | - | - |
|
| ──────── | ──────── | ──────── |
|
| - | 609 | - |
|
| ──────── | ──────── | ──────── |
|
Current assets |
|
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Trade and other receivables | 122 | 1,012 | 111 |
|
Cash and cash equivalents | 9 | 18 | 1 |
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| ──────── | ──────── | ──────── |
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| 131 | 1,030 | 112 |
|
Current liabilities |
|
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|
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Trade and other payables | (2,953) | (2,177) | (2,541) |
|
Financial liabilities - borrowings | (96) | (81) | (81) |
|
| ──────── | ──────── | ──────── |
|
Net current liabilities | (2,918) | (1,228) | (2,510) |
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| ──────── | ──────── | ──────── |
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Non-current liabilities |
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Financial liabilities - borrowings | (1,618) | (1,320) | (1,412) |
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| ──────── | ──────── | ──────── |
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NET LIABILITIES | (4,536) | (1,939) | (3,922) |
|
| ═══════ | ═══════ | ═══════ |
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Capital and reserves |
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Share capital | 3,720 | 3,930 | 3,720 |
|
Share premium | 55,683 | 55,443 | 55,683 |
|
Share based payment reserve | 140 | 140 | 140 |
|
Other reserves | (197) | 221 | 78 |
|
Retained earnings | (63,664) | (61,534) | (63,388) |
|
| ──────── | ──────── | ──────── |
|
Equity attributable to owners of the parent |
(4,318) |
(1,800) |
(3,767) |
|
Non-controlling interest | (218) | (139) | (155) |
|
| ──────── | ──────── | ──────── |
|
TOTAL DEFICIT | (4,536) | (1,939) | (3,922) | |
| ═══════ | ═══════ | ═══════ |
|
Consolidated Statement of Cash Flows for the six months ended 30 September 2016
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| |
|
| Six months to | Six months to | Year ended | |
|
| 30 September 2016 | 30 September 2015 | 31 March 2016 | |
|
| Unaudited | Unaudited | Audited | |
| Note | £'000 | £'000 | £'000 | |
|
|
|
|
| |
Cash flows from operating activities | |||||
Net cash generated utilised in operations | 4 | (51) | (122) | (237) | |
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| ──────── | ──────── | ──────── | |
Cash flows from financing activities |
|
|
|
| |
Loan repayment |
| - | (20) | (21) | |
Proceeds from borrowings |
| 7 | - | 8 | |
Proceeds on issue of |
|
|
|
| |
convertible loan notes |
| 70 | - | 10 | |
Proceeds on issue of shares |
| - | 154 | 241 | |
|
| ──────── | ──────── | ──────── | |
Net cash from financing activities |
| 77 | 134 | 238 | |
|
| ──────── | ──────── | ──────── | |
Net cash inflow |
| 26 | 12 | 1 | |
|
|
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| |
Effects of currency translation on cash and cash equivalents |
|
(18) |
3 |
(3) | |
Cash and cash equivalents at start of period |
| 1 | 3 | 3 | |
|
| ──────── | ──────── | ──────── | |
Cash and cash equivalents at end of period |
| 9 | 18 | 1 | |
|
| ═══════ | ═══════ | ═══════ | |
| |||
Consolidated Statement of Changes in Equity for the six months ended 30 September 2016
| |||
| Six months to | Six months to | Year ended |
| 30 September 2016 | 30 September 2015 | 31 March 2016 |
| Unaudited | Unaudited | Audited |
| £'000s | £'000s | £'000s |
|
|
|
|
Attributable to owners of the parent:
| |||
At beginning of period | (3,767) | (1,681) | (1,681) |
|
|
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|
Issue of share capital | - | 154 | 241 |
|
|
|
|
Share based payment charge | - | 57 | - |
|
|
|
|
Loss for the period | (276) | (368) | (2,222) |
|
|
|
|
Foreign exchange differences | (275) | 38 | (105) |
| ──────── | ──────── | ──────── |
At end of period | (4,318) | (1,800) | (3,767) |
──────── | ──────── | ──────── | |
Non-controlling interests:
| |||
At beginning of period | (155) | (125) | (125) |
|
|
|
|
Profit for the period | 1 | 3 | 3 |
|
|
|
|
Foreign exchange differences | (64) | (17) | (33) |
| ──────── | ──────── | ──────── |
At end of period | (218) | (139) | (155) |
| ──────── | ──────── | ──────── |
Total | (4,536) | (1,939) | (3,922) |
═══════ | ═══════ | ═══════ | |
Notes to the Interim Report
1. Significant Accounting Policies
These accounts have been prepared in accordance with International Financial Reporting Standards and on the historical cost basis, using generally recognised accounting principles, and consistent with those used in the annual report and accounts for the year ended 31 March 2016.
This interim report for the six months to 30 September 2016 was approved by the Board on 12 December 2016.
The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 March 2016, as described in those annual financial statements.
There are no IFRS, IFRIC interpretations or amendments that have been issued and effective for the first time in this financial period that have had a material impact on the Group.
There are no IFRS or IFRIC interpretations and amendments that are not yet effective that would be expected to have a material impact on the Group.
2. Segmental Analysis
For the six months to 30 September 2016 | UK | SE Asia | Total |
| £'000s | £'000s | £'000s |
Segment revenue and results |
|
|
|
Reportable revenue | - | - | - |
| ──────── | ──────── | ──────── |
Revenue from external customers | - | - | - |
| ──────── | ──────── | ──────── |
Reportable segment results |
|
|
|
Listing expenses | (46) | - | (46) |
Unallocated corporate income and expenses | (197) | (32) | (229) |
|
|
| ──────── |
Loss before taxation |
|
| (275) |
|
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| ═══════ |
Segment assets and liabilities |
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Segment assets |
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Reportable segment assets | 12 | 119 | 131 |
|
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| ──────── |
Consolidated total assets |
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| 131 |
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| ═══════ |
Segment liabilities |
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|
|
Reportable segment liabilities | 814 | 2,235 | 3,049 |
Issued loan notes | 80 | 1,538 | 1,618 |
|
|
| ═══════ |
Consolidated total liabilities | - | - | 4,667 |
|
|
| ═══════ |
For the six months to 30 September 2015 | UK | SE Asia | Total |
| £'000s | £'000s | £'000s |
Segment revenue and results |
|
|
|
Reportable revenue | - | - | - |
| ──────── | ──────── | ──────── |
Revenue from external customers | - | - | - |
| ──────── | ──────── | ──────── |
Reportable segment results |
|
|
|
Listing expenses | (23) | - | (23) |
Unallocated corporate income and expenses | (44) | (298) | (342) |
|
|
| ──────── |
Loss before taxation |
|
| (365) |
|
|
| ═══════ |
Segment assets and liabilities |
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|
|
Segment assets |
|
|
|
Reportable segment assets | 930 | 709 | 1,639 |
|
|
| ──────── |
Consolidated total assets |
|
| 1,639 |
|
|
| ═══════ |
Segment liabilities |
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|
|
Reportable segment liabilities | 518 | 1,740 | 2,258 |
Issued loan notes | - | 1,320 | 1,320 |
|
|
| ═══════ |
Consolidated total liabilities |
|
| 3,578 |
|
|
| ═══════ |
Other segment information |
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|
|
Depreciation of property, plant and equipment | - | 105 | 105 |
| ═══════ | ═══════ | ═══════ |
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For the year ended 31 March 2016 |
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|
|
| UK | SE Asia | Total |
| £'000s | £'000s | £'000s |
Segment revenue and results |
|
|
|
Reportable revenue | - | - | - |
| ──────── | ──────── | ──────── |
Revenue from external customers | - | - | - |
| ──────── | ──────── | ──────── |
Reportable segment results |
|
|
|
Listing expenses | (58) | - | (58) |
Impairment losses | (905) | (506) | (1,411) |
Unallocated corporate income and expenses | (451) | (299) | (750) |
|
|
| ──────── |
Profit before taxation |
|
| (2,219) |
|
|
| ═══════ |
Segment assets and liabilities |
|
|
|
Segment assets |
|
|
|
Reportable segment assets | 4 | 108 | 112 |
|
|
| ──────── |
Consolidated total assets |
|
| 112 |
|
|
| ═══════ |
Segment liabilities |
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|
|
Reportable segment liabilities | 628 | 2,002 | 2,630 |
Issued loan notes | 10 | 1,394 | 1,404 |
|
|
| ──────── |
Consolidated total liabilities |
|
| 4,034 |
|
|
| ═══════ |
Other segment information |
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|
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Depreciation of property, plant and equipment | - | 217 | 217 |
Written off of assets | 905 | - | 905 |
Impairment loss on property, plant and equipment | - | 506 | 506 |
| ═══════ | ═══════ | ═══════ |
3. Basic and diluted profit/(loss) per share
The basic loss per share is calculated by dividing the loss of £276,000 (30 September 2015 - £368,000; 31 March 2016 - £2,222,000) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period, which is 185,625,787 (30 September 2015 - 128,970,152; 31 March 2016 - 167,030,976).
For the six months to 30 September 2015 and 30 September 2016, the options and warrants on the ordinary shares were considered to be non-dilutive due to the losses incurred.
4. Reconciliation of operating loss to net cash outflow from operating activities
| Six months to | Six months to | Year ended |
| 30 September 2016 | 30 September 2015 | 31 March 2016 |
| Unaudited | Unaudited | Audited |
| £'000 | £'000 | £'000 |
|
|
|
|
Loss for the period | (275) | (365) | (2,219) |
Adjustments for : |
|
|
|
Depreciation charges | - | 105 | 217 |
Impairment loss on property, plant and equipment | - | - | 506 |
Write-off of other receivables | - | - | 905 |
Share based payments | - | 57 | - |
| ─────── | ─────── | ─────── |
Operating cash flow before movement in working capital | (275) | (203) | (591) |
|
|
|
|
Increase in receivables | (1) | (5) | - |
Increase in payables | 225 | 86 | 354 |
| ─────── | ─────── | ─────── |
Cash utilised in operations | (51) | (122) | (237) |
| ═════ | ═════ | ═════ |
5. Called up Share Capital
The issued share capital as at 31 March 2016, per the audited accounts was 185,625,787 Ordinary Shares of 0.001p each. No share has been issued during the period.
6. Business combinations and investments
As at 30 September 2016, the Company held the following subsidiaries:
|
Name of company |
| Place of incorporation and operation |
|
Issued share capital |
| Attributable equity interest |
|
Principal Activities |
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| Tricor Environmental Private Limited |
| Singapore |
| SG$ 600,000 |
| 100% |
| Mining and quarrying sand |
| Tricor Minerals Private Limited |
| Singapore |
| SG$ 372,820 |
| 72% |
| Extraction of iron sand |
| Tricor Resources Trading Private Limited
|
| Philippines |
| SG$ 124,820 |
| 72% |
| Trading of iron sand |
| Subsidiary held by Tricor Environmental Private Limited | ||||||||
| Sea Wind Group Limited |
| British Virgin Islands |
| US$ 550 |
| 100% |
| Dormant |
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|
The class of shares held for the above consists of ordinary share capital. The Company directly holds the interest in the subsidiaries.
7. Financial Liabilities - Borrowings
| Six months to | Six months to | Year ended | |
| 30 September 2016 | 30 September 2015 | 31 March 2016 | |
| Unaudited | Unaudited | Audited | |
| £'000 | £'000 | £'000 | |
|
|
|
| |
Non-current |
|
|
| |
Unsecured loan | 1,538 | 1,320 | 1,402 | |
Convertible loan | 80 | - | 10 | |
| ──────── | ──────── | ──────── | |
Total non-current borrowings | 1,618 | 1,320 | 1,412 | |
═══════ | ═══════ | ═══════ | ||
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Current |
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| |
Secured loan | 32 | 32 | 32 | |
Unsecured loan | 64 | 49 | 49 | |
| ──────── | ──────── | ──────── | |
Total current borrowings | 96 | 81 | 81 | |
| ──────── | ──────── | ──────── | |
Total borrowings | 1,714 | 1,401 | 1,493 | |
| ═══════ | ═══════ | ═══════ | |
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| |
| Six months to | Six months to | Year ended | |
| 30 September 2016 | 30 September 2015 | 31 March 2016 | |
| Unaudited | Unaudited | Audited | |
| £'000 | £'000 | £'000 | |
|
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| |
Loan maturity analysis |
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|
| |
Less than one year | 96 | 81 | 81 | |
In more than one year but not more than five years | 1,618 | 1,320 | 1,412 | |
| ──────── | ──────── | ──────── | |
Wholly repayable within five years | 1,714 | 1,401 | 1,493 | |
═══════ | ═══════ | ═══════ | ||
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On 23 December 2015, the Company entered into a working capital facility agreement with Reed Works Limited ("Reed Works"). Based on the agreement, Reed works could fund the Company up to a maximum of £300,000 in the form of interest-free, unsecured convertible loan notes ("CLN") based on the following terms:
(1) Reed Works or the Company has the right to convert the CLN to ordinary shares at the conversion rate of 0.3p for each ordinary share
(2) For each of the ordinary share issued to Reed Works upon conversion of the CLN, Reed Works will be issued 4 warrants, which are exercisable at any time until 31 December 2018 at 0.3p per warrant.
On 15 January 2016, the Company drew down £10,000 of the working capital facility provided by Reed Works and issued to Reed Works £10,000 CLN ("Tranche 1 Note") which are convertible into 3,333,333 ordinary shares at any time on or before 31 December 2018 at the conversion rate of 0.3p for each ordinary share and upon conversion of the Tranche 1 Note, the Company will issue 13,333,332 warrants. These warrants can be exercised at any time up until 31 December 2018 at an exercise price of 0.3p per warrant.
On 19 August 2016, the Company drew down £40,000 of the working capital facility provided by Reed Works and issued to Reed Works £40,000 CLN ("Tranche 2 Note") which are convertible into 16,666,666 ordinary shares at any time on or before 31 December 2018 at the conversion rate of 0.3p for each ordinary share and upon conversion of the Tranche 2 Note, the Company will issue 66,666,664 warrants. These warrants can be exercised at any time up until 31 December 2018 at an exercise price of 0.3p per warrant.
On 10 August 2016, Reed Works sent the Company a notice, exercising their right in subscribing to an additional £30,000 of 0% unsecured convertible loan notes ("Tranche 3 Notes"). Upon conversion of the Tranche 3 Notes, Reed Works will be issued another 10,000,000 ordinary shares (representing 5.4% of the current issued share capital) and 40,000,000 warrants (representing approximately 21.5% of the current issued share capital). These warrants can be exercised at any time up until 31 December 2018 at an exercise price of 0.3p per warrant.
8. The unaudited results for period ended 30 September 2016 do not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The comparative figures for the year 31 March 2016 are extracted from the statutory financial statements which have been filed with the Registrar of Companies and which contain an unqualified audit report with an emphasis of matter paragraph on the going concern basis of accounting and did not contain statements under Section 498 to 502 of the Companies Act 2006.
9. Copies of this interim statement are available from the Company at its registered office at Finsgate, 5-7 Cranwood Street, London, EC1V 9EE. The interim statement will also be available on the company website www.tricor-plc.co.uk.
Related Shares:
Tricor