10th Oct 2008 07:00
|
Immediate Release |
10 October 2008 |
Portland Gas plc
Preliminary results for the year ended 31 July 2008
Portland Gas plc (AIM: PTG) ("the Company" or "Portland Gas") the independent gas storage company is pleased to announce preliminary results for the year ended 31 July 2008.
On 16 January 2008 the Company was introduced to AIM via a demerger from its former parent company Egdon Resources Plc. The Company presents consolidated results for the financial year on a merger accounting basis.
Operational and corporate highlights
Demerger from Egdon Resources completed successfully
Dorset County Council and the Department for Business, Enterprise and Regulatory Reform granted approvals for the Portland Project
With advice from NM Rothschild & Sons Limited a process commenced to raise the Portland Project financing requirements through the introduction of joint venture partners
An exploration licence received and seismic data acquired for the Larne Lough Project
Northern Ireland Energy Holdings Limited became a strategic joint venture partner in the Larne Lough Project
Environmental Impact Assessment initiated for the Larne Project
The Group has continued to evaluate international gas storage opportunities
Financial highlights
Loss for period of £1,569,621 (2007; £208,515) inclusive of demerger costs of £430,610
Loss per share of 2.33p (2007; 0.33p)
Net cash as at 31 July 2008 £9,276,964 (2007; £3,436,695)
Capitalised expenditure on gas storage projects during the year of £7,360,442 (2007; £5,005,778)
Completion of institutional placing on 11 July 2008 to raise £8,640,000 net of expenses
Chief Executive's Report
On 16 January 2008 Portland Gas demerged from the oil and gas exploration business of Egdon Resources Plc to form an independent sub-surface gas storage company listed on AIM and has now entered an exciting phase of the Group's development.
On 11 July 2008 the Company completed a placing of 2,535,211 new ordinary shares of 10p each at 355p per share to raise £9 million before expenses. The net proceeds of the placing are to be applied to support the advanced work on the Portland gas storage project, to provide the funds to drill a confirmation borehole for the Larne Lough project and to provide funds to develop further storage opportunities. In addition 47,676 shares were issued to certain Directors at 409p in lieu of cash bonuses on 27 May 2008. Following the placing, the number of issued and fully paid shares increased to 70,384,727.
Portland Project
In May 2008 the planning committee of Dorset County Council granted planning permission to Portland Gas Storage Limited to build a deep underground salt cavern facility at Portland, Dorset. In July 2008, approval was received from the Department for Business, Enterprise and Regulatory Reform (BERR) to construct a 37 kilometre gas pipeline to connect the underground salt cavern storage facility at Portland to the National Transmission System. Permission was also granted for a 16 kilometre brine pipeline between Stafford Farm, near Dorchester, and Portland.
In August 2006 NM Rothschild & Sons Limited were appointed to advise upon the best means of raising the necessary finance to construct the Dorset project. The Group has embarked upon a process following the grant of planning permission to fund the development through the introduction of partners into a project joint venture structure.
Full construction of the Dorset project is anticipated to take seven years with initial gas storage operations commencing in 2011.
Larne Lough Project
In May 2008 the Company announced that it had entered into an agreement with Northern Ireland Energy Holdings Limited to become a joint venture partner in the Larne Lough project. 3D seismic data was acquired in the year and has indicated that the area should be suitable for the creation of a sub-surface gas storage facility under Larne Lough where Portland Gas NI Limited was granted an exploration licence in 2007. An Environmental Impact Assessment is currently being undertaken.
Storage asset portfolio development
The Group has continued to evaluate international gas storage opportunities, particularly in the liberalised markets of Europe.
Outlook
The 2008/9 financial year will again be an active time for the business.
The Group looks forward to the introduction of joint venture partners to the Portland Project and to continuing the development and construction of the Upper Osprey site.
Portland Gas NI Limited plans to drill a borehole at Larne Lough in order to confirm the suitability of the salt sequence for the creation of caverns for gas storage and to complete the Environmental Impact Assessment. It is anticipated this will result in an application being made for planning permission during 2009.
In addition the Group will continue in its stated objective of developing an international gas storage business.
Portland Gas plc
Consolidated income statement
For the year ended 31 July 2008
_________________________________________________________________________
|
Notes |
2008 |
2007 |
|||
|
£ |
£ |
||||
|
Continuing operations |
|||||
|
Revenue |
- |
- |
|||
|
Cost of sales |
- |
- |
|||
|
Gross profit/(loss) |
- |
- |
|||
|
|
|||||
|
Administrative expenses |
(1,767,017) |
(351,708) |
|||
|
Operating loss |
(1,767,017) |
(351,708) |
|||
|
Investment revenues |
197,396 |
143,193 |
|||
|
Loss before taxation |
(1,569,621) |
(208,515) |
|||
|
Taxation |
- |
- |
|||
|
Loss for the period |
(1,569,621) |
(208,515) |
|||
|
Basic and diluted loss per share |
1 |
2.33p |
0.33p |
||
Portland Gas plc
Consolidated balance sheet
As at 31 July 2008
___________________________________________________________________________
|
2008 |
2007 |
||||
|
£ |
£ |
||||
|
Non-current assets |
|||||
|
Plant and equipment |
15,195,167 |
4,400 |
|||
|
Intangible assets |
1,263,659 |
9,049,439 |
|||
|
Total non-current assets |
16,458,826 |
9,053,839 |
|||
|
Current assets |
|||||
|
Trade and other receivables |
305,520 |
328,336 |
|||
|
Available for sale financial assets |
12,500 |
- |
|||
|
Cash and cash equivalents |
9,276,964 |
3,436,695 |
|||
|
Total current assets |
9,594,984 |
3,765,031 |
|||
|
Current liabilities |
|||||
|
Trade and other payables |
(1,408,848) |
(1,441,298) |
|||
|
Net current assets |
8,186,136 |
2,323,733 |
|||
|
Non-current liabilities |
|||||
|
Obligations under contractual and lease agreements due after one year |
(1,963,519) |
- |
|||
|
Net assets |
22,681,443 |
11,377,572 |
|||
|
Shareholders' funds |
|||||
|
Share capital |
7,038,473 |
117,782 |
|||
|
Share premium |
8,576,705 |
- |
|||
|
Merger reserve |
8,988,112 |
11,650,514 |
|||
|
Share based payment reserve |
38,498 |
- |
|||
|
Retained earnings |
(1,960,345) |
(390,724) |
|||
|
22,681,443 |
11,377,572 |
||||
Portland Gas plc
Consolidated statement of changes in equity
For the year ended 31 July 2008
_____________________________________________________________________________
|
Share Capital |
Share premium |
Merger reserve |
Share based payment reserve |
Retained earnings |
Total equity |
|
|
£ |
£ |
£ |
£ |
£ |
£ |
|
|
Balance at 31 July 2006 |
100 |
- |
- |
- |
(182,209) |
(182,109) |
|
Loss for the period |
- |
- |
- |
- |
(208,515) |
(208,515) |
|
Total recognised income and expenses for the period |
- |
- |
- |
- |
(208,515) |
(208,515) |
|
Issue of equity share capital |
117,682 |
- |
11,650,514 |
- |
- |
11,768,196 |
|
Balance at 31 July 2007 |
117,782 |
- |
11,650,514 |
- |
(390,724) |
11,377,572 |
|
Loss for the period |
- |
- |
- |
- |
(1,569,621) |
(1,569,621) |
|
Total recognised income and expenses for the period |
- |
- |
- |
- |
(1,569,621) |
(1,569,621) |
|
Issue of equity share capital (pre- demerger) |
40,000 |
- |
3,960,000 |
- |
- |
4,000,000 |
|
Portland Gas plc capitalization |
6,622,402 |
- |
(6,622,402) |
- |
- |
- |
|
Issue of equity share capital (post-demerger) |
258,289 |
8,576,705 |
- |
- |
- |
8,834,994 |
|
Share based payments |
- |
- |
- |
38,498 |
- |
38,498 |
|
Balance at 31 July 2008 |
7,038,473 |
8,576,705 |
8,988,112 |
38,498 |
(1,960,345) |
22,681,443 |
Portland Gas plc
Consolidated cash flow statement
For the year ended 31 July 2008
___________________________________________________________________________
|
Notes |
2008 |
2007 |
||||
|
£ |
£ |
|||||
|
Net cash (used in) operating activities |
2 |
(1,275,246) |
(4,682,415) |
|||
|
Investing activities |
||||||
|
Interest received |
197,396 |
143,193 |
||||
|
Purchase of intangible assets |
(5,645,493) |
(3,748,890) |
||||
|
Purchase of plant and equipment |
(63,887) |
(4,843) |
||||
|
Purchase of financial assets |
(12,500) |
- |
||||
|
Net cash (used in) investing activities |
(5,524,484) |
(3,610,540) |
||||
|
Financing activities |
||||||
|
Proceeds on issue of ordinary shares |
12,639,999 |
11,768,196 |
||||
|
Net cash generated from financing activities |
12,639,999 |
11,768,196 |
||||
|
Net increase in cash and cash equivalents |
5,840,269 |
3,475,241 |
||||
|
Cash and cash equivalents at beginning of year |
3,436,695 |
(38,546) |
||||
|
Cash and cash equivalents at end of year |
9,276,964 |
3,436,695 |
||||
|
Cash and cash equivalents consist of: |
||||||
|
Cash in hand and at bank |
9,276,964 |
117,319 |
||||
|
Short term bank deposits |
- |
3,319,376 |
||||
|
£9,276,964 |
£3,436,695 |
|||||
Portland Gas plc
Notes to the financial statements
As at 31 July 2008
_____________________________________________________________________________
|
1. |
Loss per share |
2008 |
2007 |
|
|
p |
p |
|||
|
Basic loss per share |
2.33 |
0.33 |
||
|
The calculation of basic loss per share is based upon a loss of £1,569,621 (2007; £208,515) divided by the weighted average number of ordinary shares in issue of 67,381,698 (2007; 63,392,512 being the Egdon Resources Plc weighted average number of shares in issue). In accordance with IAS 33, diluted earnings per share calculations are not presented as assumed conversion of outstanding share options would be anti-dilutive; as such the diluted earnings per share is equal to the basic loss per share. |
||||
|
2. |
Cash (used in) operations |
2008 |
2007 |
|||
|
Group |
£ |
£ |
||||
|
Operating loss for the year |
(1,767,017) |
(351,708) |
||||
|
Depreciation |
19,342 |
443 |
||||
|
(Increase)/Decrease in trade and other receivables |
22,816 |
5,666 |
||||
|
(Decrease) in trade and other payables |
216,121 |
(4,336,816) |
||||
|
Share option expense |
38,498 |
- |
||||
|
Shares issued in lieu of bonus |
194,994 |
- |
||||
|
Cash (used in) operations |
(1,275,246) |
(4,682,415) |
||||
|
3. |
Basis of preparation |
||||||
|
The financial information set out in this announcement, which does not constitute the statutory accounts of the Group, is extracted from the consolidated audited statutory accounts for the year ended 31 July 2008, which were approved by the Board on 9 October 2008. The auditors have reported on these accounts in accordance with section 235 of the Companies Act 1985. Their report was unqualified and did not contain a statement under section 237(2) or 237(3) of the Companies Act 1985. The statutory accounts for 2008 will be delivered to the Registrar of Companies after the Annual General Meeting. These results have been prepared on the basis of the accounting policies adopted in the interim accounts for the interim period ended 31 January 2008. |
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|
4. |
Approval |
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|
The preliminary announcement was approved by the Board on 9 October 2008. |
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For further information please contact:
Portland Gas plc
Andrew Hindle, Chief Executive Officer 020 8332 1200
Craig Gouws, Chief Financial Officer
PR - Watershed
Sara Hudston 01308 420785
Investor Relations - Buchanan Communications
Ben Willey 020 7466 5000
Nominated Advisor and Broker - Seymour Pierce
Jonathan Wright 020 7107 8000
Sarah Jacobs
Richard Redmayne
Notes to Editors:
Background on Portland Gas
Portland Gas' business focuses on the development of gas storage projects and associated infrastructure in the United Kingdom and internationally. It currently has two projects in its portfolio, the first on Portland, for which planning permission was granted by Dorset County Council in May 2008 and Pipeline Construction Authorisation was granted by the Department of Business Enterprise and Regulatory Reform in July 2008. The second project is at Larne Lough in Northern Ireland and the Company is progressing further new venture projects in Europe. Further information is available on the Company's website www.portland-gas.com. The company is one of only a few in Europe focused specifically on gas storage development, a sector with significant growth potential given the projected significant increase in demand for gas in Europe over the coming decades.
Related Shares:
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