24th Sep 2007 07:01
Renewable Energy Holdings plc24 September 2007 24 September 2007 Renewable Energy Holdings plc ("REH" or "the Company") Interim results for the six months ended 30 June 2007 Renewable Energy Holdings plc (AIM: REH), the AIM quoted investor and operatorof proven and innovative renewable energy technologies, is pleased to announceits interim results for the six months ended 30 June 2007. Highlights • Cash flows from income producing assets now exceed corporate office running costs• Revenue increased by 20% to £1.8 million (six months to 31 Dec 2006: £1.5 million)• Project finance facility secured with Standard Chartered Bank (SCB) for €135 million: €38 million already drawn down for Kesfeld and Kirf wind farm projects• Secured a period of exclusivity with the vendors of proposed wind farm site in Wales• Strong pipeline of potential investments Post period end • CETO collaborations de-risk route to market o EDF Energies Nouvelles (EDF EN): roll-out in Northern Hemisphere and Reunion Island, and share subscription of £3 million committed by EDF EN o Carnegie Corporation: roll-out in Southern Hemisphere (excl. Reunion Island) and funding of up to £3 million for commercialisation of CETO• Placing and Warrant exercise raised £8.35 million (before expenses) • Acquisition of fully commissioned 8.0MW wind farm at Kirf, Germany • Appointment of Wayne Keast of Consensus to the Board of REH as a Non-executive Director Commenting on the results, Mike Proffitt, Chief Executive of REH, said: "REH has achieved a number of major developments to date in 2007. Theagreements with EDF Energies Nouvelle and Carnegie Corporation have de-riskedthe group of the commercialisation of CETO and the high quality of thesedevelopment partners gives us every confidence in a successful global roll outof CETO. "We continue to make progress with our wind assets, including the increase ofcapacity in Germany to 40.5MW and advanced discussions regarding a potentialwind farm site in Wales. Our interest in developing new wind farms in Europeremains high. "Finally, the credit facility with SCB and a successful capital raising thissummer provide the funding to maintain the Group's momentum as we follow ourbusiness plan and build the asset base." For further information please contact: Mike Proffitt, Chief ExecutiveRenewable Energy Holdings plc Tel: 01624 641199 Katherine RoePanmure Gordon - Broker to REH Tel: 020 7459 3600 Richard SwindellsNabarro Wells - Nominated Adviser to REH Tel: 020 7710 7400 Emma Kane / Samantha Robbins / Paul DulieuRedleaf Communications Tel: 020 7822 0200 Notes to Editors About Renewable Energy Holdings • Renewable Energy Holdings is an international company established tobe an operator of, and undertake active investment in, both proven andinnovative renewable energy technologies. • REH owns two operational wind farm sites is Germany. Kesfeld(32.5MW) and Kirf (8MW). In addition, REH is at various stages of developmentof further wind farm sites in Poland and Wales. • REH owns a 1MW methane Landfill Gas Project in Powys, Wales. Thelong-term objective for this project is to increase production to 5-6MW. • CETO is REH's innovative wave power technology. It is the firstwave power converter to sit on the seabed, where it is invisible, safe fromstorms and ocean forces, and self contained. Unlike other wave energytechnologies that require undersea grids and costly marine qualified plant, CETOrequires only a small diameter pipe to carry high pressure seawater ashore toeither a turbine to produce electricity, or to a reverse osmosis filter toproduce fresh water. • The Directors and executive team of REH have extensive experience inboth the conventional and renewable energy sectors, both in the UK and overseas,and through their experience have built a broad international network ofrelationships with individuals, companies, governments and lobby groups. • The Company was incorporated in the Isle of Man on 8 October 2004and listed on the London Stock Exchange's AIM Market in February 2005. • Further information can be found at www.reh-plc.com Chairman's Statement The half year to 30 June 2007 has seen major developments in our Company.Reference was made in my last report of our intention to refinance our Germanassets: a €135,000,000 credit facility has been established with StandardChartered Bank and the facility has been deployed as intended. We have expanded our German wind farm capacity by a further 8MW, taking thetotal to 40.5MW. Following a poor wind year in 2006, the German assets are nowperforming to our expectations with the latest 8MW expansion exceeding budgetedoutput in each of its first three months. A further expansion of this asset baseto 48MW will take place next year. Our interest in developing new wind farms in Europe remains high. Our activitiesare focussed on Poland, where we are pursuing construction of a 30MW wind farmnext year; and we are engaged in a feasibility study of a large wind farm inWales with good energy and economic prospects. The last six months have also seen major developments in the Group's CETOproject, the unique wave energy device that can be used both to generateelectricity and for water desalination. There is worldwide interest in bothcapabilities. Following the independent report on the technology, issued late 2006 by ParsonsBrinkerhoff, we entered discussions with EDF Energies Nouvelles in order toexplore the possibility of working together on the future commercialopportunities that exist for this technology. Following their own technicalexamination and due diligence, EDF Energies Nouvelles and REH have entered intoagreement exclusively to joint venture the commercial deployment of CETO, waveenergy "power stations" throughout the whole of the Northern Hemisphere and Islede la Reunion in the Indian Ocean. Meanwhile the delivery of a fully developed unit, ready for commercialisation isbeing taken forward by the agreement recently announced with Carnegie Ltd, theAustralian company originally involved in the CETO project, and a vendorshareholder in REH's admission to the AIM market. Under this agreement Carnegiewill pay the development costs and in return will be licensed by REH to deploythe CETO units commercially throughout the Southern Hemisphere, excluding Islede la Reunion. REH retains a free carried equity of 10% in all Carnegie CETOprojects, and is paid a licence fee. Through these agreements with quality development partners and the licence feearrangements, the Board of Directors of REH are confident in a global roll outof CETO on successful completion of the development of the technology, in a waythat can bring major benefits to shareholders. Finally, a successful capital raise this summer has given us the working capitalto maintain the Group's momentum as it follows its business plan and builds itsasset base. 30 months after the initial flotation, the Directors believe the Company is nowin a position of strength to fulfil its ambitions and provide a sound basis forinvestment and growth. Trading so far this year is in line with expectation. John W BakerChairman24 September 2007 Renewable Energy Holdings plc Interim condensed consolidated income statement for the six months to 30 June2007 Notes Six months to 30 Six months to 30 Twelve months to 31 June 2007 June 2006 December 2006 (Unaudited) (Unaudited) (Unaudited) £ £ £ Revenue & gross profit 4 1,859,928 1,456,549 2,912,584 ExpenditureCETO development expenses (515,151) (349,494) (904,804)Administrative expenses (2,328,697) (1,894,078) (3,907,192) Loss from Operations (983,920) (787,023) (1,899,412) Finance cost (762,989) (333,560) (745,548) Finance income 31,627 82,773 153,699 Loss before tax (1,715,282) (1,037,810) (2,491,261) Tax expense (51,721) (108,436) (193,952) Loss after tax attributable to theequity holders of the parent (1,767,003) (1,146,246) (2,685,213) Basic and diluted loss per share 5 (3.90) (2.81) (6.24) Condensed consolidated statement of recognised income and expense for the sixmonths to 30 June 2007 Notes Six months to 30 Six months to 30 Twelve months to 31 June 2007 June 2006 December 2006 (Unaudited) (Unaudited) (Unaudited) £ £ £ Loss after tax (1,767,003) (1,146,246) (2,685,213) Foreign exchange loss on retranslation ofoverseas operations (2,616) 1,848 (70,025) Total recognised income and expense forthe period (1,769,619) (1,144,398) (2,755,238) Renewable Energy Holdings plc Interim condensed consolidated balance sheet at 30 June 2007 Notes At 30 June 2007 At 31 December 2006 At 30 June 2006 (Unaudited) (Audited) (Audited) £ £ £Non-current assetsProperty, plant and equipment 26,502,841 26,677,929 23,293,606Intangible assets 7,544,126 7,596,806 7,649,485 Current assetsTrade and other receivables 6 670,632 1,271,266 765,658Cash and cash equivalents 2,885,944 2,698,789 5,678,840 Total current assets 3,556,576 3,970,055 6,444,498 Total assets 37,603,543 38,244,790 37,387,589 Current liabilitiesTrade and other payables 6 958,501 4,442,834 789,178Tax liability 101,311 88,384 -Other financial liabilities 1,509,799 1,356,277 1,458,063 Total current liabilities 2,569,611 5,887,495 2,247,241 Non-current liabilitiesFinancial liabilities 6 19,370,297 14,952,785 16,067,108Deferred Tax Liability 93,497 93,497 109,531Other Creditors - - 70,000 19,463,794 15,046,282 16,246,639 Total liabilities 22,033,405 20,933,777 18,493,880 TOTAL NET ASSETS 15,570,138 17,311,013 18,893,709 Capital and reserves attributable toequity holders of the companyShare capital 452,666 452,666 452,666Share premium reserve 16,583,898 16,583,898 16,583,898Foreign exchange reserve (84,785) (82,169) (10,296)Share based payment reserve 1,013,459 984,715 956,571Merger reserve 4,410,000 4,410,000 4,410,000Retained earnings (6,805,100) (5,038,097) (3,499,130) TOTAL EQUITY 15,570,138 17,311,013 18,893,709 Renewable Energy Holdings plc Interim condensed consolidated cash flow statement for the six months to 30 June2007 Six months to 30 Six months to 30 Twelve months to 31 June 2007 June 2006 December 2006 (Unaudited) (Unaudited) (Unaudited) £ £ £Operating activitiesNet loss from ordinary activities (983,920) (787,023) (1,899,412)Adjustments for:Depreciation 722,598 601,056 1,222,923Amortisation 52,679 17,560 70,239Foreign exchange gains (12,403) 577 543,003Equity-settled share based payments 28,744 100,738 128,882 Operating loss before changes inworking capital and provisions (192,302) (67,092) 65,635 Decrease in deferred expenditure - 590,631 590,631Decrease in trade and other receivables 600,634 1,294,654 789,046Increase in other financial assets - 1,276 1,276Increase/(decrease) in trade and other payables (3,484,332) 258,628 3,842,284 Cash generated/(absorbed) from other operations (3,076,000) 2,078,097 5,288,872 Income taxes paid (38,794) - (13,166) Cash flows from operating activities (3,114,794) 2,078,097 5,275,706 Investing activitiesAcquisition of property, plant & equipment (537,723) (12,581,711) (17,202,200)Acquisition of subsidiary - net of cash acquired - (2,481,926) (2,481,926)Interest received 31,627 82,773 153,699 Cash flows from investing activities (506,096) (14,980,864) (19,530,427) Financing activitiesIssue of ordinary shares - 6,050,000 6,050,000Issue costs - (385,139) (385,139)Proceeds from bank borrowings 4,571,033 9,370,544 9,370,544Issue costs for bank borrowing - (500,572) (500,572)Repayment of bank borrowing - (661,212) (1,938,280)Finance costs paid (762,989) (301,770) (652,799) Cash flows from financing activities 3,808,044 13,571,851 11,943,754 (Decrease)/increase in cash and cash equivalents 187,154 669,084 (2,310,967) Renewable Energy Holdings plc Notes to the interim condensed consolidated financial statementsfor the six month period ended 30 June 2007 1. Basis of preparation The unaudited consolidated interim financial statements have been prepared usingaccounting policies consistent with those International Financial ReportingStandards (IFRS) in force, as adopted by the European Union and on the basis ofthe accounting policies disclosed in the financial statements for the six monthsended 31 December 2006, which are also expected to apply for the year ended 31December 2007. During the second half of 2006 the company changed its accounting reference datefrom 30 June to 31 December, as a result the comparatives for the full yearended 31 December 2006 are not the Company's full statutory accounts for thatyear; they have been produced from the audited statutory accounts for the yearto 30 June 2006 and the audited statutory accounts for the six months to 31December 2006. Copies of these statutory accounts have been delivered to theCompanies Registry. The auditors' reports on those accounts were unqualified,did not include references to any matters to which the auditors drew attentionby way of emphasis without qualifying their report, and did not contain astatement under chapter 2 section 15.4 of the Companies Act 1982. 2. Issue of shares No shares were issued during the period. After the balance sheet date thefollowing shares were issued: On 8 August 2007 8,000,000 shares were issued at a price of 50 pence. On 10 August 2007 8,692,000 warrants were exercised, as a result on 23 August8,692,000 shares were issued at a price of 50 pence. 3,208,000 warrants remainin issue. 3. Related party transactions During the period to 30 June 2007 a net amount of £3,503 was received fromCarnegie Corporation in respect of administration services rendered (31 December2006: £9,505 net paid to Carnegie Corporation, 30 June 2006: £13,042 net paid toCarnegie Corporation). An amount of £3,885 has been received from Carnegie Corporation in respect ofoffice rent paid on behalf of Carnegie Corporation (31 December 2006: £NIL, 30June 2006: £NIL). Included in creditors is £148,000 due to Carnegie Corporation from SeapowerPacific Pty Limited (31 December 2006: £NIL, 30 June 2006: £NIL). Mr Alan Burns,a Director of Renewable Energy Holdings Plc and Seapower Pacific Pty Limited isChairman of Carnegie Corporation. An amount of £54,332 has been received from BPC Ltd in respect of travel costsincurred on BPC business and office rent paid on behalf of BPC (31 December2006: £10,228, 30 June 2006 £7,872 paid to BPC Ltd in respect of office costsand rent). Mr Alan Burns and Mr Michael Proffitt are Directors of both Renewable EnergyHoldings plc and BPC Ltd. 4. Segment information The group's primary reporting format for reporting segment information isbusiness segments, and the segments are defined as Head Office, CETOdevelopment, Windfarm and Landfill gas. This split coincides with a geographicalorigin split of activities; Head Office being in the Isle of Man, CETOdevelopment taking place in Australia, Wind farm in Germany and Landfill gas inWales. Head Office CETO Development Wind farm Landfill Gas Isle of Man Australia Germany Wales Total £ £ £ £ £Six months ended30 June 2007Operating income - - 1,734,460 125,468 1,859,928Finance Income 8,773 6,209 16,645 - 31,627 8,773 6,209 1,751,105 125,468 1,891,555 Total profit/(loss) before (896,734) (508,942) (244,889) (64,717) (1,715,282)taxation Twelve months ended31 December 2006Operating income - - 2,790,226 122,358 2,912,584Finance Income 124,305 7,124 22,270 - 153,699 124,305 7,124 2,812,496 122,358 3,066,283 Total profit/(loss) before (2,006,670) (668,537) 366,564 (182,618) (2,491,261)taxation Six months ended30 June 2006Operating income - - 1,415,651 40,898 1,456,549Finance Income 75,024 3,046 4,703 - 82,773 75,024 3,046 1,420,354 40,898 1,539,322 Total profit/(loss) before (1,103,705) (165,305) 258,067 (26,867) (1,037,810)taxation There has been no material change in the amount of total assets per segmentsince 31 December 2006, and the basis of segmentation is consistent with thatapplied at 31 December 2006. 5. Loss per share The calculation of basic loss per share is based on the weighted average numberof shares in issue throughout the period. The diluted loss per share has beencalculated in accordance with the provisions of IAS 33 and is the same as thebasic loss per share. 6. Trade receivables and payables At 31 December 2006 an amount of £3,829,226 was included in trade payables whichrepresented payments due to enXco GmbH for the expansion of the Kesfeld windfarm in Germany, an amount of £281,693 was also included in trade receivableswhich represented the corresponding VAT reclaimable by the company. During theperiod to 30 June 2007 the payments to enXco have been funded by drawing down onthe company's €135,000,000 project finance facility with Standard CharteredBank, and the corresponding VAT has been reclaimed. The effect on theconsolidated balance sheet as at 30 June 2007 is a reduction of £3,829,266 incurrent liabilities, a corresponding increase in financial liabilities, and areduction in trade receivables of £281,693. 7. Events after the balance sheet date The Group is in the process of completing the acquisition of Windpark Kirf GmbH& Co. KG, the owner of an 8MW wind farm located in Kirf, Rheinland-Pfalz,Germany. A cash payment of €10,157,000 has been made for the purchase of theelectricity generating assets. In the opinion of the Directors the fair value ofthe net assets acquired along with the expected associated costs will be equalto the total costs of acquisition. 8. Copies of these interim results will be available from the Company's websiteat www.reh-plc.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
REH.L