3rd Mar 2006 17:43
Asia Energy PLC03 March 2006 3 March 2006 Asia Energy PLC (AIM: AEN) INTERIM REPORT FOR THE SIX MONTHS ENDED 31 DECEMBER 2005 Chairman's Statement Asia Energy PLC ('the Company') completed all major exploratory work for itsplanned open pit coal mine at Phulbari in Northwest Bangladesh in the six monthsto 31 December 2005. During the period, the Company also submitted its Scheme ofDevelopment and Feasibility Study for the 15 million tonnes per annum mine forthe Phulbari Coal Project ("Project") to the Government of Bangladesh ('GoB'),and the Company is confident that in due course the Project will be given thenecessary approvals. In addition it also raised sufficient finance to fund thefirst 6 months of development expenditure from approval of the Scheme ofDevelopment up to commencement of initial earthworks. Following completion of drilling and geophysical surveying, a JORC compliantstatement in August 2005 established the Resource at Phulbari at 572 milliontonnes, with 532 in the Measured and Indicated categories. The statement notedthat the basin remained open to the south with the possibility of still morecoal to be discovered. In an important milestone on 11 September 2005, the Department of Environment ofthe Government of Bangladesh formally approved the Environmental ImpactAssessment (EIA) Report for the Project and granted it Environmental Clearance. As part of its commitment to bring significant direct benefits to the people andcountry of Bangladesh, in October 2005 the Company lodged a proposal with theGoB's Power Development Board to build a 500MW coal fired power plant. The proposed plant will generate 3,700 Gwh a year by burning about 1.5 milliontonnes of coal, about one tenth of the Phulbari mine's annual target productionof 15 million tonnes. In the same month, the Company announced that it had mandated the AsianDevelopment Bank (ADB) to undertake a Due Diligence Review for potentiallyproviding senior financing of the Project. The Company formally lodged its Scheme of Development and Feasibility Study forthe mine with the GoB in early October 2005. This triggered an automatic reviewprocess under the contract, and the Government appointed a committee ofTechnical Experts to report back on the Project. The work of the TechnicalExperts is expected to be completed in March 2006. In November 2005, the Company raised US$ 52 million before expenses by placingan additional 6,740,000 shares through JPMorgan Cazenove Limited. The placementprovides sufficient funding to carry the Project through to start of miningoperations. The CEO of the Company's Bangladesh subsidiary, Mr Gary Lye, was appointed tothe board in November 2005, and a new Company Chief Executive, Mr Steve Bywater,was recruited in January 2006. Results During the six months to 31 December 2005, the Company made a loss before andafter tax of £355,350 (31 December 2004 : Loss of £300,307) . Exploration costsof £3.9 million for the period have been capitalised (31 December 2004: £2.4million). They relate mainly to the drilling programme at Phulbari and the workon the Definitive Feasibility Study. In Summary All the major preparatory work is now successfully completed and we have theright team in place to carry the Phulbari Coal Project through to start ofmining. We remain confident that the Project will be approved and we expect tostart pre-mining activities as planned in 2006. Christopher EagerChairman For further information please contact: Asia Energy PLC:Steve Bywater, Chief ExecutiveTel: +44 (0) 20 7079 1798, Fax: +44 (0) 20 7491 2758 (London)Gary Lye, Chief Operating Officer: +88 0173016704 (Bangladesh)Website: www.asia-energy.com Parkgreen Communications:Justine Howarth, Cathy MalinsTel: +44 (0) 20 7493 3713 Group Profit and Loss Account 6 months to 6 months to Year ended 30 31 December 31 December June 2005 2005 2004 Note (unaudited) (unaudited) £ £ £ Administrative expenses (511,187) (561,482) (1,328,579) Group operating loss (511,187) (561,482) (1,328,579) Interest receivable 155,837 261,175 447,409 Group operating loss and loss on ordinaryactivities before taxation (355,350) (300,307) (881,170) Taxation on loss on ordinary activities - - - Loss on ordinary activities after taxation (355,350) (300,307) (881,170) Loss for the financial period attributableto members of the parent company (355,350) (300,307) (881,170) Retained loss for the period (355,350) (300,307) (881,170) Basic and diluted loss per share (pence) (0.8)p (0.7)p (2.3)p Group Statement of Total Recognised Gains and Losses 6 months to 6 months to Year ended 31 December 31 December 30 June 2005 2004 2005 (unaudited) (unaudited) £ £ £ Loss for the financial period attributableto members of the parent company (355,350) (300,307) (881,170) Total recognised losses relating to theperiod (355,350) (300,307) (881,170) Group Balance Sheet 31 December 31 December 30 June 2005 2004 2005 Note (unaudited) (unaudited) £ £ £ Fixed assetsIntangible assets 14,218,822 4,548,467 10,287,033Tangible assets 328,605 379,221 361,280 14,547,427 4,927,688 10,648,313 Current assetsDebtors 199,500 163,909 237,296Cash at bank and in hand 4 31,049,827 10,169,946 5,642,722 31,249,327 10,333,855 5,880,018 Creditors: amounts falling due within oneyear (774,904) (637,976) (1,180,337) Net current assets 30,474,423 9,695,879 4,699,681 Total assets less current liabilities 45,021,850 14,623,567 15,347,994 Capital and reservesCalled up share capital 4,800,438 3,827,064 4,001,103Share premium account 41,853,997 11,492,875 12,624,126Profit and loss account (1,632,585) (696,372) (1,277,235) Equity shareholders' funds 5 45,021,850 14,623,567 15,347,994 The Financial Statements were approved by the Board on 3 March 2006 and signedon its behalf. ..................... ..................... Stephen Bywater David Lenigas Group Cash Flow Statement Note 6 months to 6 months to Year ended 31 December 31 December 30 June 2005 2004 2005 (unaudited) (unaudited) £ £ £ Net cash outflow from operating activities 3 (440,716) (575,363) (1,281,244) Returns on investments and servicing offinanceInterest received 155,837 288,823 492,936Net cash inflow from returns on investments 155,837 288,823 492,936and servicing of finance Taxation - - - Capital expenditure and financialinvestmentPurchase of tangible fixed assets - (244,393) (256,583)Purchase of intangible fixed assets (4,337,224) (1,950,655) (7,269,211)Net cash outflow from capital expenditure (4,337,224) (2,195,048) (7,525,794)and financial investments Management of liquid resourcesDecrease in short term deposits - 2,000,000 11,000,000 Net cash outflow before financing (4,622,103) (481,588) 2,685,898 FinancingIssue of ordinary share capital 31,237,500 500,999 1,806,289Share issue costs (1,208,292) (15,000) (15,000)Net cash inflow from financing 30,029,208 485,999 1,791,289 Increase in cash 4 25,407,105 4,411 4,477,187 Notes to Interim Report 1 - Basis of Preparation of Financial Statements The financial information contained herein does not constitute statutoryaccounts within the meaning of Section 240 of the Companies Act 1985. Theunaudited interim financial information has been prepared on the basis of theaccounting policies set out in the Group's accounts for the year ended 30 June2005. The figures for the year ended 30 June 2005 have been extracted from theaccounts. Those accounts have been filed with the Registrar of Companies andcontained an unqualified report. The Company's auditors, Ernst & Young LLP,have reviewed the interim financial information for the six months ended 31December 2005 and their report is set out on page 9. The financial information for the 6 months ended 31 December 2005 is unaudited.In the opinion of the directors the financial information for this period fairlypresents the financial position, results of operations and cash flows for thisperiod and conforms with generally accepted accounting principles. Fundamental Accounting Concept The Directors are confident that the Company's coal interests will be able to becommercially realised and are confident that further funding and necessarygovernment approvals will be obtained. The Directors have taken steps to ensurethis occurs and have appointed Barclays Capital to provide advice and servicesin evaluating options and sources of funding, including equity, project debt,debentures, convertible debentures, export credit agencies, multi and bi-lateralagencies, off-take agreements and joint venture partners. With completion of theBanking documents including the Independent Reviews on technical, environmentaland social studies, the Banking marketing process to determine the optimalcombination of these finance options should commence in early 2006. On thisbasis, the Directors believe that the adoption of the going concern basis isjustified. 2 - Segmental Analysis There was no turnover during the financial period. The administrative expensesrelate to the United Kingdom, Australian and Bangladesh offices. The Group operates in one principal area of activity being coal exploration anddevelopment. The Group operates within one geographical market, being Bangladesh, and issupported by management and administrative functions in Australia and the UnitedKingdom. Notes to Interim Report (cont.) 3 - Net Cash Outflow from Operating Activities 6 months to 6 months to Year ended 31 December 2005 31 December 30 June (unaudited) 2004 2005 (unaudited) £ £ £ Operating loss (511,187) (561,482) (1,328,579)Depreciation and amortisation 32,675 19,646 49,778(Increase)/Decrease in debtors 37,796 (75,900) (167,167)Increase in creditors - 5,809 128,160Decrease in stocks - 36,564 36,564Net cash outflow from operating activities (440,716) (575,363) (1,281,244) 4 - Reconciliation of Net Cash Flow to Movement in Net Funds 6 months to 6 months to Year ended 31 December 31 December 30 June 2005 2004 2005 (unaudited) (unaudited) £ £ £ Increase in cash in the period 25,407,105 4,411 4,477,187Decrease in short term deposits - (2,000,000) (11,000,000) 25,407,105 (1,995,589) (6,522,813) Net funds at beginning of period 5,642,722 12,165,535 12,165,535Net funds at end of period 31,049,827 10,169,946 5,642,722 5 - Reconciliation of Movements in Shareholders' Funds 6 months to 6 months to Year ended 31 December 2005 31 December 30 June (unaudited) 2004 2005 (unaudited) £ £ £ Loss for the period (355,350) (300,307) (881,170)New share capital subscribed 799,335 66,800 240,839Share premium (net of costs) 29,229,871 434,199 1,565,450Net increase in shareholders' funds 29,673,856 200,692 925,119 Shareholders' funds at beginning of period 15,347,994 14,422,875 14,422,875 Shareholders' funds at end of period 45,021,850 14,623,567 15,347,994 INDEPENDENT REVIEW REPORT TO ASIA ENERGY PLC Introduction We have been instructed by the company to review the financial information forthe six months ended 31 December 2005 which comprises Group Profit and LossAccount, Group Balance Sheet, Group Cash Flow Statement, Group Statement ofTotal Recognised Gains and Losses and the related notes 1 to 5. We have readthe other information contained in the interim report and considered whether itcontains any apparent misstatements or material inconsistencies with thefinancial information. This report is made solely to the company having regard to guidance contained inBulletin 1999/4 'Review of interim financial information' issued by the AuditingPractices Board. To the fullest extent permitted by the law, we do not accept orassume responsibility to anyone other than the company, for our work, for thisreport, or for the conclusions we have formed. Directors' responsibilities The interim report, including the financial information contained therein, isthe responsibility of, and has been approved by, the directors. The directorsare responsible for preparing the interim report as required by the AIM Rulesissued by the London Stock Exchange. Review work performed We conducted our review having regard to the guidance contained in Bulletin 1999/4 'Review by the Auditing Practices Board for use in the United Kingdom. Areview consists principally of making enquiries of management and applyinganalytical procedures to the financial information and underlying financialdata, and based thereon, assessing whether the accounting policies andpresentation have been consistently applied, unless otherwise disclosed. Areview excludes audit procedures such as tests of controls and verification ofassets, liabilities and transactions. It is substantially less in scope than anaudit performed in accordance with United Kingdom Auditing Standards andtherefore provides a lower level of assurance than an audit. Accordingly we donot express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 31 December 2005. Ernst & Young LLPRegistered AuditorLondon3 March 2006 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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