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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| GCM Resources Plc | AQSE:GCM.GB | Aquis Stock Exchange | Ordinary Share | GB00B00KV284 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 6.00 | 5.50 | 6.50 | 6.20 | 5.825 | 6.00 | 225,967 | 15:47:16 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMGCM
RNS Number : 5356T
GCM Resources PLC
30 March 2016
30(th) March 2016
GCM Resources plc
("GCM" or the "Company")
(LON:GCM)
Interim results for the six months ended 31 December 2015
GCM Resources plc (LON:GCM), a resource exploration and development company, is pleased to report its interim results for the six months ended 31 December 2015. The Chairman's Statement and the full unaudited interim report are presented below.
Chairman's Statement
I am pleased to present the Interim Report of GCM Resources plc ("GCM"), covering the period 1 July to 31 December 2015. The Board is committed to developing the Phulbari Coal Project (the "Project") a world class, high quality coal resource of 572 million tonnes (JORC 2004 compliant) located in the Dinajpur District in North-West Bangladesh. Despite the delay in receiving approval from the Government of Bangladesh necessary to proceed with Project development, the business, financial, economic and social basis for advancing the Project remains very strong.
During the last six months the Government has pursued its goal of rapidly increasing the nation's current 250MW of coal fired power capacity to 19,000MW over the next 14 years as part of its strategic plan to restructure the country's power sector. Once in operation, the coal-fired power plants will require the equivalent of some 58 million tonnes of high calorific coal per annum, substantially increasing the demand for coal in-country. The Government announced plans to source coal from overseas but has yet to secure any at this point in time.
A developed Phulbari Coal Project can greatly assist the Government in its objective of delivering substantial and much needed coal-fired power generation to foster industrial development, create jobs and improve the livelihoods of the people of Bangladesh. Of the five known coal deposits in Bangladesh, the Phulbari coal deposit is the most advanced in preparation for extraction. GCM's extensive and detailed exploration and evaluation studies have included a Definitive Feasibility Study and Scheme of Development, an Environment and Social Impact Assessment approved by the Department for Environment, and a proposal for staged implementation of large scale mine-mouth coal fired power generation which would deliver the cheapest coal fired power in the country. A Phulbari mine will supply up to 15 million tonnes per annum of high quality thermal coal, sufficient to support a generating capacity of 4,000MW. The Company has continued to pursue approval of the Project with the Government throughout the period.
Recognising the importance of maintaining a social licence, the Company has continued with its local engagement activities in the Dinajpur District to strengthen and develop the dialogue with local communities. During the period the Company reported having met with around 2,500 people across the Project area since it commenced its re-engagement strategy in late 2012. The GCM teams working in the field listen to the views of the community and provide assurance of the Company's continued intentions in relation to the mine and related community investment.
During the period the Company also reported the successful conclusion to the OECD examination after a thorough and impartial examination which first started in December 2012. The Project developed by GCM will be of considerable benefit to the local communities, the country, the Government and shareholders alike.
Financials
For the six months ended 31 December 2015 GCM recorded a loss of GBP640,000 (2014: loss of GBP461,000). The increase in the loss for the period was due to non-cash expenditure of GBP294,000 (2014: GBP124,000) predominantly relating to share based payments. Capitalised evaluation costs for the six months ended 31 December 2015 was GBP335,000 (2014: GBP356,000).
During the previous financial year the Company secured a GBP3m convertible loan facility to be drawn down upon as required, in order to provide sufficient funding for the foreseeable future. As at 29 March 2016 the Company had utilised GBP510,000 of the facility. As the current share price is well below the agreed loan-to-share conversion price of 11 pence per share, the Company has experienced difficulties in drawing down further funds in accordance with its rights under the agreement. GCM is in discussions with the counterparty to resolve the issue and is at the same time seeking alternative funding arrangements which would relieve the Company from dependence on the convertible loan facility. As discussed in Note 1 this represents a material risk that may cast significant doubt over the Company's ability to continue as a going concern. The Board is confident that future fundraising will be successful to ensure the ongoing activities of the Company.
Outlook
The Company remains wholly focused on pursuing the necessary approval from the Government of Bangladesh for the Project to proceed with the next stage of development. The Directors are confident that an agreement can be reached which satisfies the objectives of both the Government and the Company. Discussions are ongoing with targeted potential partners who may assist in advancing the Project toward development.
I would like to thank the Board and staff for their hard work during the period and shareholders for their continued confidence and support.
Datuk Michael Tang
Executive Chairman
Interim Consolidated Income Statement
Hot Features
Premium
6 months 6 months Year ended
ended ended 30 June
31 December 31 December 2015
2015 2014 audited
unaudited unaudited GBP000
GBP000 GBP000
------------------------------ ------------- ------------- -----------
Operating expenses
Exploration
and evaluation
costs (20) (15) (75)
Share based
payments (271) (124) (177)
Administrative
expenses (326) (325) (688)
------------------------------- ------------- ------------- -----------
Operating loss (617) (464) (940)
Finance revenue - 3 4
Finance costs (23) - (1)
------------------------------- ------------- ------------- -----------
Loss before
tax (640) (461) (937)
Taxation - - -
Loss and total comprehensive
income for the period (640) (461) (937)
------------------------------- ------------- ------------- -----------
Earnings per
share
Basic loss per share
(pence) (1.0p) (0.7p) (1.5p)
Diluted loss per share
(pence) (1.0p) (0.7p) (1.5p)
Interim Consolidated Statement of Changes in Equity
Share Share Share Convertible Accumulated Total
capital premium based loan losses
account payments equity
not component
settled
GBP000 GBP000 GBP000 GBP000
GBP000 GBP000
--------------------- --------- --------- ---------- ------------ ------------ --------
Balance at
1 July 2014 6,286 45,286 585 - (13,820) 38,337
Total comprehensive
loss - - - - (937) (937)
Drawdown of
convertible
loan - - - 40 - 40
Share based
payments - - 13 - 177 190
Balance at
30 June 2015 6,286 45,286 598 40 (14,580) 37,630
Total comprehensive
loss - - - - (640) (640)
Drawdown of
convertible
loan - - - 56 - 56
Share based
payments - - 6 - 271 277
Balance at
31 December
2015 (unaudited) 6,286 45,286 604 96 (14,949) 37,323
--------------------- --------- --------- ---------- ------------ ------------ --------
Balance at
1 July 2014 6,286 45,286 585 - (13,820) 38,337
Total comprehensive
loss - - - - (461) (461)
Share based
payments - - 7 - 124 131
Balance at
31 December
2014 (unaudited) 6,286 45,286 592 - (14,157) 38,007
--------------------- ------ ------- ---- --------- -------
(MORE TO FOLLOW) Dow Jones Newswires
March 30, 2016 05:45 ET (09:45 GMT)
Interim Consolidated Balance Sheet
31 December 31 December 30 June
2015 2014 2015
Notes unaudited unaudited audited
GBP000 GBP000 GBP000
--------------------- -------- ------------- ------------ ---------
Current assets
Cash and cash
equivalents 50 628 169
Receivables 114 38 213
--------------------- -------- ------------- ------------ ---------
Total current
assets 164 666 382
Non-current
assets
Property, plant
and equipment 31 31 32
Intangible assets 3 38,067 37,509 37,732
Receivables 54 - 60
Total non-current
assets 38,152 37,540 37,824
Total assets 38,316 38,206 38,206
--------------------- -------- ------------- ------------ ---------
Current liabilities
Payables (480) (199) (424)
Borrowings (100) - -
--------------------- -------- ------------- ------------ ---------
Total current
liabilities (580) (199) (424)
Non-current
liabilities
Borrowings (413) - (152)
--------------------- -------- ------------- ------------ ---------
Total non-current
liabilities (413) - (152)
Total liabilities (993) - (576)
--------------------- -------- ------------- ------------ ---------
Net assets 37,323 38,007 37,630
--------------------- -------- ------------- ------------ ---------
Equity
Share capital 6,286 6,286 6,286
Share premium
account 45,286 45,286 45,286
Other reserves 700 592 638
Accumulated
losses (14,949) (14,157) (14,580)
----------------- --------- --------- ---------
Total equity 37,323 38,007 37,630
----------------- --------- --------- ---------
Datuk Michael Tang
Chairman
Interim Consolidated Statement of Cash Flows
6 months 6 months Year ended
ended ended 30 June
31 December 31 December 2015
2015 2014 audited
unaudited unaudited GBP000
GBP000 GBP000
------------------------------- ------------- ------------- -----------
Cash flows used in operating
activities
Loss before
tax (640) (461) (937)
Adjusted for:
Finance revenue - (3) (4)
Finance costs 23 - 1
Share based
payments 271 124 177
Other non-cash - - -
expenses
------------------------------- ------------- ------------- -----------
(346) (340) (763)
Movements in
working capital:
Decrease/(increase) in
operating receivables 89 26 (68)
Increase/(decrease) in
operating payables 42 (71) 15
-------------------------------- ------------- ------------- -----------
Cash used in
operations (215) (385) (816)
Interest received - 3 4
-------------------------------- ------------- ------------- -----------
Net cash used in operating
activities (215) (382) (812)
Cash flows from investing
activities
Payments for
intangible assets (313) (322) (551)
Payments for property, (1) - -
plant and equipment
-------------------------------- ------------- ------------- -----------
Net cash generated from
investing activities (314) (322) (551)
Cash flows from financing
activities
Proceeds from
convertible
loan 310 - 200
Proceeds from loan 100 - -
-------------------------------- ------------- ------------- -----------
Net cash from financing
activities 410 - 200
Total increase/(decrease)
in cash and cash equivalents (119) (704) (1,163)
Cash and cash equivalents
at the start of the period 169 1,332 1,332
-------------------------------- ------------- ------------- -----------
Cash and cash equivalents
at the end of the period 50 628 169
-------------------------------- ------------- ------------- -----------
Notes to the Interim Condensed Consolidated Financial Statements
1. Accounting policies
GCM Resources plc (GCM) is domiciled in England and Wales, was incorporated as a Public Limited Company on 26 September 2003 and admitted to the London Stock Exchange Alternative Investment Market (AIM) on 19 April 2004.
The unaudited interim report was authorised for issue by the Directors on 30 March 2016, and the Interim Consolidated Balance Sheet was signed on the Board's behalf by Datuk Michael Tang.
Basis of preparation
The annual consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union as they apply to the financial statements of the Group for the year ended 30 June 2015 and applied in accordance with the Companies Act 2006. The interim condensed consolidated financial statements for the six months ended 31 December 2015 have been prepared using the same policies and methods of computation as applied in the financial statements for the year ended 30 June 2015, and have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union.
There has been no impact on the Group's financial position or performance from new and amended IFRS and IFRIC interpretations mandatory as of 1 July 2015.
The financial information contained herein does not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006 and is unaudited. The figures for the year ended 30 June 2015 have been extracted from the statutory accounts for that year. Those accounts have been delivered to the Registrar of Companies and contained an unqualified auditors' report which included an emphasis of matters concerning the uncertainty over the recoverability of the intangible mining assets and significant doubt over the ability for the Group to continue as a going concern, and did not include a statement under section 498(2)(a) or (b), or section 498(3) of the Companies Act 2006.
Political and economic risks
The principal asset is in Bangladesh and accordingly subject to the political, judicial, fiscal, social and economic risks associated with operating in that country.
The Group's principal project relates to thermal coal and semi-soft coking coal, the markets for which are subject to international and regional supply and demand factors, and consequently future performance will be subject to variations in the prices for these products.
GCM, through its subsidiaries, is party to a Contract with the Government of Bangladesh which gives it the right to explore, develop and mine coal in respect to licence areas in Northern Bangladesh. The Group holds a mining lease and exploration licences in the Phulbari area covering the prospective mine site. The mining lease has a 30 year term from 2004 and may be renewed for further periods of 10 years each, at GCM's option.
In accordance with the terms of the Contract, GCM submitted a combined Feasibility Study and Scheme of Development report on 2 October 2005 to the Government of Bangladesh. Approval from the Government of Bangladesh is necessary to proceed with development of the mine. GCM continues to await approval.
The Group has received no notification from the Government of Bangladesh of any changes to the terms of the Contract. GCM has received legal opinion that the Contract is enforceable under Bangladesh and International law, and will consequently continue to endeavour to receive approval for development.
The Directors are confident that the Phulbari Coal Project will ultimately receive approval, although until that approval is received there is significant uncertainty over the recoverability of the intangible mining assets. The Directors consider that it is appropriate to continue to record the intangible mining assets at cost, however if for whatever reason the Scheme of Development is not ultimately approved, the Group would impair all of its intangible mining assets totalling GBP38,067,000 as at 31 December 2015.
Going concern
(MORE TO FOLLOW) Dow Jones Newswires
March 30, 2016 05:45 ET (09:45 GMT)
GCM relies on its current resources as well as committed GBP3,000,000 convertible loan facility and borrowings to fund its operating activities. As at 29 March 2016 the Group had utilised GBP510,000 of the convertible loan facility. As the current share price is well below the agreed loan-to-share conversion price of 11 pence per share, GCM has experienced difficulties in drawing down further funds form the lender in accordance with its rights under the agreement. GCM is in discussions with the counterparty to resolve the issue and is at the same time seeking alternative funding arrangements which would relieve the Group from dependence on the convertible loan facility. While the Board remains confident that future fundraising will be successful to ensure that necessary funds will be available as and when required, this represents a material uncertainty that may cast significant doubt over the Group's ability to continue as a going concern.
Projections of future costs for a number of scenarios leading to approval of the Phulbari Coal Project have been prepared and, taking into account a number of factors, the Directors have satisfied themselves that the Group will have adequate financial resources to continue in operational existence for the foreseeable future. Accordingly, the financial statements have been prepared on a going concern basis. Upon achieving approval of the Phulbari Coal Project, additional financial resources will be required to proceed with development.
2. Segment analysis
The Group operates in one segment: exploration and evaluation of energy related projects. The only significant project within this segment is the Phulbari Coal Project in Bangladesh.
3. Intangible assets
Intangible assets increased by GBP335,000 during the six months to 31 December 2015 (December 2014: GBP356,000). The increase is due to the exploration and evaluation expenditure relating to the Phulbari Coal Project, and is capitalised in accordance with the Group's accounting policies.
For further information:
GCM Resources plc Bell Pottinger James Hobson Greg Wood CFO & Company Secretary +44 (0) 20 3772 2500 +44 (0) 20 7290 1630 ZAI Corporate Finance Ltd Nominated Adviser and Broker Richard Morrison +44 (0) 20 7060 2220 GCM Resources plc Tel: +44 (0) 20 7290 1630 info@gcmplc.com; www.gcmplc.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR ZMGFFLGRGVZG
(END) Dow Jones Newswires
March 30, 2016 05:45 ET (09:45 GMT)
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