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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Providence Resources Plc | LSE:PVR | London | Ordinary Share | IE00B66B5T26 | ORD EUR0.001 (CDI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.25 | 3.10 | 3.40 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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Providence Resources P.l.c. - Half Year 2016 Results
LEADING OFFSHORE IRELAND
Dublin and London - September 29, 2016 - Providence Resources P.l.c.
(PVR LN, PRP ID), the Irish based Oil and Gas Exploration Company, today
announces its unaudited interim results for the half year ended June 30,
2016.
Tony O'Reilly, Chief Executive Officer commented:
"Providence enters the second half of the year with renewed optimism. A
solid balance sheet and significantly enhanced financial strength,
combined with the planned near term drilling activity at our Druid
prospect have the potential to create significant shareholder value.
During the first half of 2016, the market volatility that characterized
the E&P sector in 2015 continued and presented the industry with
significant commercial and financial challenges. A dearth of M&A
activity in the sector, compounded by some very specific pressures
relating to the scheduled Melody debt repayment, coupled with the
adverse Court of Appeal ruling, had material implications for
Providence. However, thanks to the support of our existing shareholders
and new investors, we successfully raised new funds in July 2016 to
allow us to completely restructure our balance sheet and provide the
financial resources and flexibility to advance our very extensive
portfolio of assets. Importantly, we were able to repay all of our
corporate debt, settle the outstanding litigation with Transocean and
provide the appropriate resources to finance the drilling of the high
impact Druid exploration well in 2017.
The success of this financing clearly demonstrates shareholder support
for our strategy to develop our unique portfolio of appraisal and
exploration assets offshore Ireland. In that context, the Irish offshore
has become a very attractive location for industry majors as evidenced
by the record number of new licensing authorisations awarded in the 2015
Atlantic Margin Licensing Round.
The securing of funds to be able to drill the Druid prospect is a rare
opportunity for us to avail of the cost dynamics that currently exist in
the industry. With estimated Pmean in place oil resources of over 3 BBO,
we believe that Druid represents one of the few world class deep-water
exploration prospects being planned for drilling in 2017. Having
secured the necessary finance and now with an even lower cost estimate
than previously forecast, we are moving forward with our drilling
programme targeting a spud date in June 2017.
Key to the Providence portfolio is Barryroe, where the financial
restructuring combined with the industry's falling cost profile, now
provides increased flexibility in terms of our commercial farm out
negotiations. We look forward to updating the market further as we
continue to develop and consolidate our leading position offshore
Ireland."
H1 2016 OPERATIONAL HIGHLIGHTS
APPRAISAL PROJECTS
-- Barryroe Oil Project, North Celtic Sea Basin (SEL 1/11)
- Upper C-Sand GIIP within SEL 1/11 & OPL1 Option area now estimated at
c. 400 BSCF- Latest well cost estimates for single vertical well c.
US$25 million
-- Spanish Point Gas Condensate Project, Northern Porcupine Basin (FEL 2/04
& 4/08)
- Adjacent third party Licensing Options awarded in 2015 Atlantic Margin
Licensing Round
-- Helvick / Dunmore Oil Discoveries North Celtic Sea Basin
- Award of Lease Undertakings- 50% staged farm in by Marginal Field
Development Company Limited
EXPLORATION PROSPECTS
-- Druid / Drombeg Oil Prospects, Southern Porcupine Basin (FEL 2/14)
- Multi-domain analysis confirms that the 3D seismic responses from the
Druid and Drombeg prospects are consistent with the presence of 2 large
vertically stacked stratigraphically trapped oil accumulations- Total
cumulative in place un-risked prospective resources of c. 5.095 BBO
(Pmean)
-- Druid - c. 3.180 BBO (Pmean)
-- Drombeg - c. 1.915 BBO (Pmean)
- Both Druid and Drombeg prospects could be evaluated with a single
vertical exploration well
- Adjacent third party Licensing Options awarded in 2015 Atlantic Margin
Licensing Round
-- Newgrange Prospect, Goban Spur Basin (FEL 6/14)
- Seismic supports top seal and reservoir presence for Cretaceous
target- Pre-Cretaceous structural closure far larger than previously
mapped- Adjecent third party Licensing Options awarded in 2015 Atlantic
Margin Licensing Round
-- Avalon Oil Prospect, Northern Porcupine Basin (LO 16/27)
- Award of new Licensing Option in 2015 Atlantic Margin Licensing Round-
Large AVO stratigraphic Paleocene oil play analogous to Druid
-- Dunquin Oil Prospect, Southern Porcupine Basin (FEL 3/04)
- Dunquin North post-well technical studies continuing- Evidence of more
significant residual oil in the Dunquin North well- Adjacent third party
Licensing Options awarded in 2015 Atlantic Margin Licensing Round
-- Kish Oil Prospect, Kish Bank Basin (SEL 2/11)
- Company's working interest increased to 100%
PORTFOLIO MANAGEMENT
-- Relinquishments made to Licence Authorisations over:
- Cuchulain, Southern Porcupine Basin (FEL 1/99)
- Polaris, Rathlin Basin (P 1885)
- Dragon (UK), St George's Channel Basin (P 1930)
H1 2016 FINANCIAL HIGHLIGHTS
-- Further reduction in administration costs and legal expenses
-- Operating loss for the period of EUR2.216 million (EUR3.787 million in H1
2015)
-- Loss of EUR4.440 million (EUR8.425 million in H1 2015)
-- Loss per share of 3.17 cents (7.94 cents in H1 2015)
-- At June 30, 2016, total cash and cash equivalents were EUR0.522 million
(EUR11.289 million at June 30, 2015)
-- At June 30, 2016 debt was EUR19.546 million (EUR15.610m at June 30,
2015)
-- June 21, 2016 - Capital fundraising announced (and approved at the EGM on
July 14, 2016)with proceeds proposed to be used to:
- Retire corporate debt- Make payment to Transocean- Provide working
capital- Finance the Company's share of funding the drilling of the
Druid exploration well
LITIGATION AGAINST TRANSOCEAN DRILLING UK LIMITED ("TRANSOCEAN")
-- April 2016 Court of Appeal Ruling
- In April 2016, the Court of Appeal of England and Wales overturned one
aspect of the judgment handed down by the Commercial Court in London in
December 2014 in relation to the Transocean litigation. Accordingly, the
Company was ordered to pay Transocean the gross amount of c.US$6.77
million in respect of certain costs claimed by Transocean in the
original legal proceedings issued against the Company by Transocean in
May 2012- Pursuant to the Court of Appeal Order, on April 27, 2016, the
Company paid GBP225,000, being part of Transocean's legal costs for
appeal, and a balance of GBP183,000 was paid on July 18, 2016- Lansdowne,
the Company's joint venture partner in Barryroe, is liable for 20% share
of all costs associated with the litigation- In addition, the Court of
Appeal Order stated that other matters in dispute between the Company
and Transocean will be the subject of a further hearing in the
Commercial Court in London unless otherwise resolved between the parties
-- Appeal to the Supreme Court
- The Company has sought leave to appeal the Court of Appeal Order
Judgment to the Supreme Court in the UK. A decision on the grant of such
leave to appeal is expected to take between nine months to one year and
further announcements will be made in this regard in due course
POST JUNE 30 EVENTS
-- Barryroe Oil Project, North Celtic Sea Basin (SEL 1/11)
- Farm out discussions continue
-- Druid/ Drombeg Oil Prospects, Southern Porcupine Basin (FEL 2/14)
- Election made to enter Phase 2 of Licence (includes the commitment of
one exploration well)- Druid 2017 Drilling Programme
-- Appointment of Well Management Company
-- Invitation To Tender ("ITT") issued for the provision of a
deep-water drilling unit
-- Druid well design to allow for optional penetration of underlying
Drombeg prospect
-- Planned spud date for Druid well is June 2017, subject to
regulatory consents
-- Revised Druid well cost estimates is c. $35 million (compared to
previous estimate of $46 million)
-- Additional cost for deepening of well to penetrate the Drombeg
prospect amounts to c. $15 million
-- Farm out discussions continue
-- Newgrange Prospect, Goban Spur Basin (FEL 6/14)
- Prospective Resource Potential of c. 13.6 TSCF GIIP or c. 9.2 BBO
STOIIP- Top Seal capacity analysis indicates potential for a hydrocarbon
column of up to 350 metres- Latest internal well gross cost estimate of
c. $22.5 million- Farm out discussions continue
-- Spanish Point Gas Condensate Project, Northern Porcupine Basin (FEL 2/04)
- Farm out campaign continues
-- Dunquin Oil Prospect, Southern Porcupine Basin (FEL 3/04)
- ENI assumes operatorship following withdrawal of ExxonMobil-
Providence's equity increased to 26.846%*
* Includes equity acquired from Atlantic Petroleum in July 2015, which
is subject to approval of the Minister for Communications, Climate
Action and Environment.
PLACING OFFER AND OPEN OFFER
-- July 14, 2016 - EGM held
- All resolutions passed with at c. 99% acceptances
-- Details of Placing
- Raised gross proceeds of GBP53.712 million through issuance of 447.607
million shares GBP0.12 pence per share- Significantly increased the
depth of institutional shareholder base
-- Details of Open Offer
- Raised proceeds of EUR1.516 million through the issuance of 9.975
million shares**
Directors subscribed for 1.956 million shares** at a cost of EUR0.297
million
**Includes 200,000 direct share subscription by Lex Gamble
-- Following Admission of Placing and Open Offer shares, the Company's total
issued and voting share capital now comprises 597,658,958 ordinary shares
of EUR0.10 each
POST FINANCING EVENTS
-- Melody Debt Retired
- Post the EGM, all amounts outstanding under the loan facility with
Melody were paid in full by the payment of cash equal to US$20 million
(together with accrued interest) and the allotment of 9,938,033 ordinary
shares of EUR0.10 cents each (at the Placing price of GBP0.12 per
share)- Post repayment, the floating charge over the Company's assets
held by Melody was released- Providence is now debt free
-- Court of Appeal - Transocean Litigation
- The Company discharged the balance of the uncontested sums owing to
Transocean in respect of the Court of Appeal order made on April 13,
2016- The hearing of Transocean's claim in respect of Part 36 of the
English Civil Procedure Rules has now been listed to be heard by Mr
Justice Popplewell on Friday, October 14, 2016- In the event that
Transocean is successful in the Commercial Court in relation to the Part
36 claim, the Company estimates that it would be required to make
additional net payment of c.US$3.1 million to Transocean- In the event
of an adverse adjudication, it is open to the Company to appeal such a
decision
SUMMARY OF KEY ASSETS/RESOURCE BASE
APPRAISAL ASSETS
-- Barryroe Oil Project, North Celtic Sea Basin (PVR-80%)
Field Size (2C): 346 MMBOE REC
Net to PVR: 277 MMBOE REC
-- Hook Head Oil Project, North Celtic Sea Basin (PVR-72.5%)
Field Size (2C): 35 MMBOE REC
Net to PVR: 25 MMBOE REC
-- Spanish Point Gas Condensate Project, Northern Porcupine Basin (PVR-58%)
Field Size (2C): 337 MMBOE REC
Net to PVR: 195 MMBOE REC
EXPLORATION ASSETS
-- Dunquin South Oil Prospect, Southern Porcupine Basin (PVR-26.85%*)
Prospect Size (Pmean): 1,389 MMBOE REC
Net to PVR: 372 MMBOE REC
* Includes equity acquired from Atlantic Petroleum
in July 2015, which is subject to approval of the
Minister of Communication, Climate Action and the
Environment
-- Avalon Oil prospect, Southern Porcupine Basin (PVR-80%)
Prospect Size (Pmean): TBC
Net to PVR: TBC
-- Druid Oil Prospect, Southern Porcupine Basin (PVR-80%)
Prospect Size (Pmean): 3.180 BBO STOIIP
Net to PVR: 2.544 BBO STOIIP
-- Drombeg Oil Prospect, Southern Porcupine Basin (PVR-80%)
Prospect Size (Pmean): 1.915 BBO STOIIP
Net to PVR: 1.532 BBO STOIIP
-- Newgrange Gas Prospect, Goban Spur Basin (PVR-80%)
Prospect Size (Pmean): 13.6 TSCF GIIP
Net to PVR: 10.8 TSCF
-- Kish Oil Prospect, Kish Bank Basin (PVR-100%)
Prospect Size (P50): 210 MMBO REC
Net to PVR: 210 MMBOE REC
BOARD CHANGES
-- Appointment of Mr. Pat Plunkett as Non-executive Chairman with effect
from October 1, 2016
-- Mr. James McCarthy to remain as a Non-executive Director
-- Retirement of Dr. Phil Nolan as a Non-executive Director with effect from
October 1, 2016
OUTLOOK
Whilst the industry backdrop still remains challenging, with our
completely restructured balance sheet and extensive mature portfolio, we
are very well placed to deliver on our plans. With clear shareholder
endorsement of our strategy to exploit our portfolio, and with a major
drilling campaign at Druid planned for 2017, we are optimistic about the
prospects both for Providence and the overall Irish Oil and Gas sector.
We remain both determined and uniquely positioned to lead the industry
in identifying and realizing the significant potential that exists
offshore Ireland.
INVESTOR ENQUIRIES
Providence Resources P.l.c. Tel: +353 1 219 4074
Tony O'Reilly, Chief Executive Officer
Cenkos Securities plc Tel: +44 131 220 9771
Neil McDonald/Derrick Lee
J&E Davy Tel: +353 1 679 6363
Anthony Farrell
MEDIA ENQUIRIES
Powerscourt Tel: +44 207 250 1446
Lisa Kavanagh/Peter Ogden
Murray Consultants Tel: +353 1 498 0300
Pauline McAlester
ABOUT PROVIDENCE RESOURCES
Providence Resources is an Irish based Oil and Gas Exploration Company
with a portfolio of appraisal and exploration assets located offshore
Ireland. Providence's shares are quoted on AIM in London and the ESM in
Dublin.
GLOSSARY OF TERSM USED
BBO - Billion Barrels of Oil
BSCF - Billion Standard Cubic Feet of Gas
EGM - Extraordinary General Meeting
FEL - Frontier Exploration Licence
GIIP - Gas Initially in Place
LO - Licensing Option
LU - Lease Undertaking
MMBO - Millions of Barrels of Oil
MMBOE - Millions of Barrels of Oil Equivalent
OPL - Offshore Production Lease
Pmean - the expected average value or risk-weighted average of all
possible outcomes
Rec - Recoverable
SEL - Standard Exploration Licence
STOIIP - Stock Tank of Oil Initially in Place
TSCF - Trillion Standard Cubic Feet of Gas
ANNOUNCEMENT
This announcement has been reviewed by Dr John O'Sullivan, Technical
Director, Providence Resources P.l.c. John is a geology graduate of
University College, Cork and holds a Masters in Applied Geophysics from
the National University of Ireland, Galway. He also holds a Masters in
Technology Management from the Smurfit Graduate School of Business at
University College Dublin and a doctorate in Geology from Trinity
College Dublin. John is a Chartered Geologist and a Fellow of the
Geological Society of London. He is also a member of the Petroleum
Exploration Society of Great Britain, the Society of Petroleum Engineers
and the Geophysical Association of Ireland. John has more than 25 years
of experience in the oil and gas exploration and production industry
having previously worked with both Mobil and Marathon Oil. John is a
qualified person as defined in the guidance note for Mining Oil & Gas
Companies, March 2006 (London Stock Exchange). Definitions in this press
release are consistent with SPE guidelines.
SPE/WPC/AAPG/SPEE Petroleum Resource Management System 2007 has been
used in preparing this announcement.
SUMMARY OF KEY ASSETS
Ref Licence Issued Key Asset Operator Partners % Classification
NORTH CELTIC SEA BASIN
SEL
1 1/11 2011 BARRYROE Providence Lansdowne 80.00 Oil discovery
SEL Atlantic; Oil and gas
2 2/07 2007 HOOK HEAD Providence Sosina 72.50 discovery
Atlantic;
Sosina,
Lansdowne Oil and gas
2 LU 2016 HELVICK Providence , MFDC 56.25 discovery
Atlantic;
Sosina,
2 LU 2016 DUNMORE Providence MFDC* 65.25 Oil discovery
NORTHERN PORCUPINE BASIN
FEL Oil and gas
3 2/04 2004 SPANISH POINT Cairn Sosina 58.00 discoveries
FEL SPANISH POINT Oil and gas
3 4/08 2008 NTH Cairn Sosina 58.00 exploration
SOUTHERN PORCUPINE BASIN
FEL Repsol; Oil and gas
4 3/04 2004 DUNQUIN SOUTH Eni Sosina 26.85 exploration
LO Oil and gas
5 16/27 2016 AVALON Providence Sosina 80.00 exploration
FEL Oil
6 2/14 2014 DRUID/DROMBEG Providence Sosina 80.00 exploration
GOBAN SPUR BASIN
FEL Oil and gas
7 6/14 2014 NEWGRANGE Providence Sosina 80.00 exploration
KISH BANK BASIN
SEL Oil and gas
8 2/11 2011 KISH BANK Providence 100.00 exploration
PROVIDENCE RESOURCES P.l.c.
Condensed consolidated income statement
For the 6 months ended 30 June 2016
6 months ended 30 June 2016 6 months ended 30 June 2015 Year ended 31 December 2015
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
Continuing operations
Administration and
legal expenses 3 (1,739) (3,250) (6,437)
Pre-licence
expenditure (59) (441) (856)
Impairment of
exploration and
evaluation assets (418) (96) (5,787)
Operating loss 2 (2,216) (3,787) (13,080)
Finance income 6 23 34
Finance expense 4 (2,230) (4,661) (11,091)
Loss before income tax (4,440) (8,425) (24,137)
Income tax expense - - -
Loss for the period (4,440) (8,425) (24,137)
Loss per share (cent)
- continuing
operations
Basic and diluted loss
per share 8 (3.17) (7.94) (19.57)
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of comprehensive income
For the 6 months ended 30 June 2016
6 months ended 30 June 2016 6 months ended 30 June 2015 Year ended 31 December 2015
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Loss for the financial period (4,440) (8,425) (24,137)
Items that may be reclassified to profit or loss
Foreign exchange translation differences (2,266) 6,076 7,178
Total income and expense recognised in other comprehensive
income from continuing operations (2,266) 6,076 7,178
Total comprehensive expense for the period (6,706) (2,349) (16,959)
The total recognised expense for the period is entirely attributable to
equity holders of the Company.
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of financial position
As at 30 June 2016
30 June 2016 30 June 2015 31 December 2015
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
Assets
Exploration and evaluation assets 5 96,904 96,504 98,211
Property, plant and equipment 136 35 168
Intangible assets 243 - 296
Total non-current assets 97,283 96,539 98,675
Trade and other receivables 2,400 338 2,174
Cash and cash equivalents 522 11,289 6,518
Total current assets 2,922 11,627 8,692
Total assets 100,205 108,166 107,367
Equity
Share capital 6 25,694 25,694 25,694
Capital conversion reserve fund 623 623 623
Share premium 6 226,998 226,998 226,998
Foreign currency translation reserve 9,555 10,719 11,821
Share based payment reserve 3,151 3,996 3,586
Retained deficit (203,785) (184,478) (199,780)
Total equity attributable to equity holders of the
Company 62,236 83,552 68,942
Liabilities
Decommissioning provision 7,324 6,875 7,424
Total non-current liabilities 7,324 6,875 7,424
Trade and other payables 11,099 2,129 12,712
Loans and borrowings 7 19,546 15,610 18,289
Total current liabilities 30,645 17,739 31,001
Total liabilities 37,969 24,614 38,425
Total equity and liabilities 100,205 108,166 107,367
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of changes in Equity
For the 6 months ended 30 June 2016
Capital Foreign Share
Conversion Currency Based
Share Reserve Share Translation Payment Retained
Capital Fund Premium Reserve Reserve Deficit Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
At 1 January
2015 18,151 623 210,230 4,643 4,282 (176,339) 61,590
Loss for
financial
period - - - - - (8,425) (8,425)
Currency
translation - - - 6,076 - - 6,076
Total
comprehensive
income - - - 6,076 - (8,425) (2,349)
Transactions
with owners,
recorded
directly in
equity
Share options
lapsed in
period - - - - (286) 286 -
Shares issued
in period 7,543 - 16,768 - - - 24,311
At 30 June
2015 25,694 623 226,998 10,719 3,996 (184,478) 83,552
At 1 January
2016 25,694 623 226,998 11,821 3,586 (199,780) 68,942
Loss for
financial
period - - - - - (4,440) (4,440)
Currency
translation - - - (2,266) - - (2,266)
Total
comprehensive
income - - - (2,266) - (4,440) (6,706)
Transactions
with owners,
recorded
directly in
equity
Share options
lapsed in
period - - - - (435) 435 -
At 30 June
2016 25,694 623 226,998 9,555 3,151 (203,785) 62,236
At 1 January
2015 18,151 623 210,230 4,643 4,282 (176,339) 61,590
Loss for
financial
year - - - - - (24,137) (24,137)
Currency
translation - - - 7,178 - - 7,178
Total
comprehensive
income - - - 7,178 - (24,137) (16,959)
Transactions
with owners,
recorded
directly in
equity
Share options
lapsed in
year - - - - (696) 696 -
Shares issued
in period 7,543 - 16,768 - - - 24,311
At 31 December
2015 25,694 623 226,998 11,821 3,586 (199,780) 68,942
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of cash flows
For the 6 months ended 30 June 2016
6 months 6 months Year
ended 30 ended 30 ended 31
June June December
2016 2015 2015
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Cash flows from operating activities
Loss before income tax for the period (4,440) (8,425) (24,137)
Adjustments for:
Depletion and depreciation 34 10 34
Amortisation of intangible assets 52 - 17
Impairment of exploration and evaluation assets 418 96 5,787
Finance income (6) (23) (34)
Finance expense 2,230 4,661 11,091
Foreign exchange (572) (1,255) (2,684)
Change in trade and other receivables (226) 1,549 (287)
Change in trade and other payables (1,705) (11,194) (521)
Interest paid (996) (1,512) (4,204)
Net cash (outflow) from operating activities (5,211) (16,093) (14,938)
Cash flows from investing activities
Interest received 6 23 34
Acquisition of exploration and evaluation assets (326) (2,190) (7,746)
Acquisition of property, plant and equipment - (15) (484)
Change in restricted cash - 3,296 3,296
Net cash from investing activities (320) 1,114 (4,900)
Cash flows from financing activities
Proceeds from issue of share capital - 25,754 25,754
Share capital issue costs - (1,443) (1,443)
(Repayments) / proceeds from loans and borrowings - (3,671) (3,671)
Net cash from financing activities - 20,640 20,640
Net (decrease)/increase in cash and cash equivalents (5,531) 5,661 802
Cash and cash equivalents at beginning of period 6,518 5,256 5,256
Effect of exchange rate fluctuations on cash and cash
equivalents (465) 372 460
Cash and cash equivalents at end of period 522 11,289 6,518
PROVIDENCE RESOURCES P.l.c.
Note 1
Basis of preparation
Providence Resources P.l.c ("the Company") is a company incorporated in
the Republic of Ireland. The unaudited consolidated interim financial
statements of the Company for the six months ended 30 June 2016 (the
"Interim Financial Statements") include the Company and its subsidiaries
(together referred to as the "Group"). The Interim Financial Statements
were authorised for issue by the Directors on 28 September 2016.
The annual financial statements of the group are prepared in accordance
with IFRSs as adopted by the EU. These condensed set of financial
statements included in this half-yearly report have been prepared in
accordance with the recognition and measurement requirements of IFRSs as
adopted by the EU and the Group's accounting policies as disclosed in
the 2015 Annual Report, which are available from the group's website
www.providenceresources.com.
The Interim Financial Statements do not constitute statutory financial
statements. The statutory financial statements for the year ended
December 31, 2015, extracts from which are included in these Interim
Financial Statements, were prepared under IFRSs as adopted by the EU and
will be filed with the Registrar of Companies with the Company's 2015
annual return.
The Interim Financial Statements are presented in Euro, rounded to the
nearest thousand, which is the functional currency of the parent company
and also the presentation currency for the Group's financial reporting.
PROVIDENCE RESOURCES P.l.c.
Note 2
Operating segments
6 months ended 30 6 months ended 30 Year ended 31
June 2016 June 2015 December 2015
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Segment net (loss)
for the period
UK - exploration
assets (73) - (1,841)
Republic of
Ireland -
exploration
assets (345) (96) (3,946)
Corporate expenses (1,798) (3,691) (7,293)
Operating loss for
the period (2,216) (3,787) (13,080)
Segment assets
UK - exploration
assets - 1,879 73
Republic of
Ireland -
exploration
assets 96,905 94,997 100,710
US 32 - 32
Group assets 3,268 11,290 6,552
Total assets 100,205 108,166 107,367
Segment
Liabilities
UK - exploration (101) (57) (14)
Republic of
Ireland -
exploration (18,322) (8,882) (19,634)
US - - -
Group liabilities (19,546) (15,675) (18,777)
Total Liabilities (37,969) (24,614) (38,425)
Capital
Expenditure
UK - exploration
assets 71 88 103
Republic of
Ireland -
exploration
assets 255 2,102 7,643
Republic of
Ireland -
property, plant
and equipment - 15 484
Total Capital
Expenditure 326 2,205 8,230
Impairment charge
Republic of
Ireland -
exploration
assets 345 96 3,946
UK - exploration
assets 73 - 1,841
418 96 5,787
PROVIDENCE RESOURCES P.l.c.
Note 3
Administration and legal Expense
6 months ended 30 6 months ended 30 Year ended 31
June 2016 June 2015 December 2015
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Corporate,
exploration and
development
expenses 1,952 2,290 3,783
Legal expenses 110 329 2,127
Foreign exchange
difference 219 1,478 1,550
Total
administration
expenses for the
period 2,281 4,097 7,460
Capitalised in
exploration and
evaluation
assets (542) (847) (1,023)
Total charged to
the income
statement 1,739 3,250 6,437
PROVIDENCE RESOURCES P.l.c.
Note 4
Finance Expense
6 months ended 30 6 months ended 30 Year ended 31
June 2016 June 2015 December 2015
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Interest expense 1,010 1,399 2,367
Amortisation of
arrangement fees
and other
amounts 1,680 720 2,861
Unwinding of
discount on
decommissioning
provision (74) 748 1,390
Interest charge on
legal settlement - - 2,141
Foreign exchange
(gain)/loss on
revaluation of
loan (386) 1,794 2,332
Total finance
expense
recognised in
income statement 2,230 4,661 11,091
Recognised
directly in
equity
Foreign currency
differences on
foreign
operations (2,266) 6,076 7,178
Total finance
expenses
recognised in
equity (2,266) 6,076 7,178
PROVIDENCE RESOURCES P.l.c.
Note 5
Exploration and evaluation assets
Republic of Ireland UK Total
EUR'000 EUR'000 EUR'000
Cost and book value
At 1 January 2015 88,095 1,638 89,733
Additions 1,273 70 1,343
Administration expenses capitalised 830 17 847
Impairment charge (96) - (96)
Foreign exchange translation 4,523 154 4,677
At 30 June 2015 94,625 1,879 96,504
At 1 January 2015 88,095 1,638 89,733
Additions 6,805 84 6,889
Administration expenses capitalised 1,004 19 1,023
Cash call received in year (166) - (166)
Impairment charge (3,946) (1,841) (5,787)
Foreign exchange translation 6,419 100 6,519
At 31 December 2015 98,211 - 98,211
At 1 January 2016 98,211 - 98,211
Additions 507 65 572
Cash calls received in period (788) - (788)
Administration expenses capitalised 537 5 542
Impairment charge (345) (73) (418)
Foreign exchange translation (1,218) 3 (1,215)
At 30 June 2016 96,904 - 96,904
PROVIDENCE RESOURCES P.l.c.
Note 6
Share Capital and Share Premium
Number
Authorised: '000 EUR'000
At 1 January 2016
Deferred shares of EUR0.011 each 1,062,442 11,687
Ordinary shares of EUR0.10 each 223,131 22,313
At 30 June 2016
Deferred shares of EUR0.011 each 1,062,442 11,687
Ordinary shares of EUR0.10 each* 223,131 22,313
Number Share Capital Share Premium
Issued: '000 EUR'000 EUR'000
Deferred shares of EUR0.011 each 1,062,442 11,687 5,691
Ordinary share of EUR0.10 each 64,649 6,464 204,539
At 1 January 2015 64,649 18,151 210,230
Shares issued 75,427 7,543 18,211
Share issue costs - - (1,443)
At 30 June 2015 140,076 25,694 226,998
At 31 December 2015 140,076 25,694 226,998
At 30 June 2016 140,076 25,694 226,998
PROVIDENCE RESOURCES P.l.c.
Note 7
Loans and Borrowings
Loan facility Loan fees Total
EUR'000 EUR'000 EUR'000
At 1 January 2015 19,727 (379) 19,348
Drawn down in period 1,519 (4,125) (2,606)
Charged to income statement - 720 720
Repaid during period (3,646) - (3,646)
Foreign exchange 1,794 - 1,794
At 30 June 2015 19,394 (3,784) 15,610
At 1 January 2015 19,727 (379) 19,348
Drawn down in period 1,519 (4,125) (2,606)
Charged to income statement - 2,861 2,861
Repaid during period (3,646) - (3,646)
Foreign exchange 2,332 - 2,332
At 31 December 2015 19,932 (1,643) 18,289
Drawn down during period (37) (37)
Charged to income statement - 1,680 1,680
Foreign exchange (386) - (386)
At 30 June 2016 19,546 - 19,546
Analysed as follows: 30 June 2016 31 December 2015 30 June 2015
Non-Current EUR'000 EUR'000 EUR'000
Credit facility - - -
Total - - -
Current
Credit facility 19,546 18,289 15,610
Total 19,546 18,289 15,610
At end of period 19,546 18,289 15,610
In May 2016, the Group extended its loan facility with Melody LLC
through to 13 June 2016. The interest rate is 10% and the facility is
secured over the assets of the Group via a floating charge. See Note 11
for further details.
PROVIDENCE RESOURCES P.l.c.
Note 8
Earnings per share
31
30 June 30 June December
2016 2015 2015
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Loss attributable to equity holders of the company
from continuing operations (4,440) (8,425) (24,137)
The basic weighted average number of Ordinary share
in issue ('000)
In issue at beginning of year 140,076 64,649 64,649
Adjustment for shares issued in period - 41,444 58,689
Weighted average number of ordinary shares 140,076 106,093 123,338
Basic loss per share (cent) - continuing operations (3.17) (7.94) (19.57)
The weighted average number of ordinary shares for
diluted earnings per share calculated as follows:
Weighted average number of ordinary shares 140,076 106,093 123,338
Diluted loss per share (cent) - continuing
operations (3.17) (7.94) (19.57)
There is no difference between the loss per ordinary share and the
diluted loss per share for the current period as all potentially
dilutive ordinary shares outstanding are anti-dilutive.
PROVIDENCE RESOURCES P.l.c.
Note 9
Related party transactions
Mr. Tony O'Reilly, has through Kildare Consulting Limited, a company
beneficially owned by him, a contract for the provision of service to
the company outside the Republic of Ireland effective May 1, 2015. It is
of two years duration and is subject to one year's notice period. The
amount paid under the contract from 1 January to 30 June 2016 was
EUR186,990.
PROVIDENCE RESOURCES P.l.c.
Note 10
Commitments
As at 30 June 2016, the Group has capital commitments of approximately
EUR3.2m to contribute to its share of costs of exploration and
evaluation activities.
PROVIDENCE RESOURCES P.l.c.
Note 11
Post Balance Sheet Events
Equity fundraising
The Company announced on 21 June 2016 a conditional equity placing and
open offer. The equity placing raised net proceeds of c.US$68.4 million
(EUR60.5 million) while the open offer raised c. EUR1.516m. The
resolutions were voted on by shareholders at an Extraordinary General
Meeting on 14 July 2016 and all the resolutions were passed.
Transocean Drilling UK Limited legal case
In May 2012, Transocean initiated proceedings against the Company for
c.US$19 million. The Company counterclaimed pleading that Transocean was
in breach of contract because their rig and their equipment were not in
good working condition or adequate to conduct the drilling activities
over most of a period from late December 2011 through to early February
2012. In December 2014, a judgment was handed down by the Commercial
Court in London (the "Judgment") which confirmed the Company's pleadings
that it should not have to pay Transocean for those periods when the rig
was not operable, due to breaches of contract arising from Transocean's
failure to carry out maintenance on safety critical parts of its sub-sea
equipment. The Judgment provided that the Company should also be allowed
to set-off certain third party costs against Transocean's claim. The
Judgment allowed the parties to agree the final account, with the
Company paying a net amount of c.US$6.15 million and Lansdowne paying
c.US$1.54 million.
Transocean was subsequently granted the right to appeal one aspect of
the Judgment. In April 2016 the Court of Appeal ruled in favour of
Transocean's appeal (the "Appeal Judgment"). The
appeal of this one aspect of the Judgment turned on the Court of
Appeal's interpretation of the wording of the consequential loss clause
in the rig contract.
In relation to the Appeal Judgement, by Order of Her Majesty's Court of
Appeal of England and Wales made on 13 April 2016 (the "EWCA Order"),
the Company was ordered to pay Transocean a gross amount of c.US$6.77
million on or before 4.00 p.m. on 6 May 2016 in respect of certain costs
claimed by Transocean in the context of the original legal proceedings
issued against the Company by Transocean in May 2012. This amount has
been fully accrued as at 31 December 2015. The EWCA Order further stated
that the Company was required to pay part of Transocean's legal costs of
the appeal in the sum of gross GBP225,000 by 27 April 2016 (with the
remainder to be agreed and paid at a future date). This amount was fully
accrued as at 31 December 2015.
These legal costs in the sum of GBP225,000 were paid to Transocean on 27
April 2016 and the remaining balance of GBP183,000 was paid on the 18
July 2016. In addition, the EWCA Order stated that other matters in
dispute between the Company and Transocean in the legal proceedings will
be the subject of a further hearing in the Commercial Court in London
unless otherwise resolved between the parties.
The two main matters which arise out of the Court of Appeal judgment and
which remain unresolved as at the date of the financial statements are
as follows:
(a) the quantification of interest on the judgment sum awarded by the
Court of Appeal to Transocean; and
(b) whether Transocean is entitled to its legal costs (and interest
thereon) in respect of the first instance decision handed down by the
Commercial Court in London in December 2014, on the basis of Transocean
having previously made an offer to the Company (the "Settlement Offer")
to reach a settlement in respect of those proceedings pursuant to Part
36 of the English Civil Procedure Rules (the "CPR"). Part 36.14 of the
CPR provides that, where judgment against a defendant (in this case, the
Company) is at least as advantageous as the proposals in the Part 36
offer, the offeror (in this case, Transocean) would be entitled to its
legal costs and interest on those costs together with interest on the
principal sums from the date upon which the period for acceptance of the
offer expired.
Transocean contends that, as the aggregate amount payable to them as a
result of the Judgment and the Appeal Judgment is more advantageous to
Transocean than the terms of the Settlement Offer, that Transocean is
now entitled to recover from the Company its costs (and interest
thereon) in respect of the first instance proceedings. The Company will
be required to make an additional payment to Transocean pursuant to
paragraph (a) above in the sum of (net) c.US$0.4 million (however, the
final amount has yet to be agreed/determined) and, in the event that
Transocean is successful in the Commercial Court in relation to the
matter outlined in paragraph (b) above, an additional payment of (net)
c.US$3.1 million.
As of the date of the interim financial statements, the date of 14
October 2016 has been set by the Commercial Court to consider these
matters. In the event of an adverse adjudication, it is open to the
Company to appeal such a decision.
Following the issue of the EWCA Order, the Company and Transocean
reached agreement (the "TO Agreement") whereby the Company agreed to
make a payment of (gross) US$2 million to Transocean (in part
satisfaction of the EWCA Order) payment of which has now been made. The
Company made a further payment on the 18 July 2016 to Transocean.
Lansdowne, the Company's joint venture partner in Barryroe, is also
liable for its (20 per cent interest) share of all costs associated with
the litigation.
The Company confirms that it has sought leave to appeal the Appeal
Judgment to the Supreme Court in the UK. A decision on the grant of such
leave to appeal is expected to take between nine months and one year to
be reached and further announcements will be made in this regard in due
course.
Melody
The company's facility with Melody was due for repayment on the 22 May
2016 for $21.7m. The Company reached agreement with Melody to extend the repayment date of the facility to the 13 June 2016 and to extend the period within which to cure any event of default from 3 Business days to 25 Business days (subject to the preservation of the Lenders' rights and remedies under the Facility agreement or at law in respect of any event of default arising in relation to insolvency proceedings). Accordingly, in the event of non-payment of the amounts due to Melody by 13 June 2016, the Company was required to remedy such default by the close of business on 15 July 2016. The company made the payment due to Melody on the 15 July 2016 for the $20m while the remaining liability of $1.7m was converted into 9,938,033 shares which was authorised at the EGM on 14 July 2016. As at the date of approval of these interim financial statements, the Company has no loans outstanding after the settlement of the Melody loan facility. This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients. The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein. Source: Providence Resources plc via Globenewswire http://www.providenceresources.com/html/
(END) Dow Jones Newswires
September 29, 2016 02:00 ET (06:00 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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