Wentworth Resources Ltd Wentworth Resources Limited : Q2 2017 And Half Year Financial Statements And Md&A

 
TIDMWRL 
 
 
 
 
 
 
   PRESS RELEASE 
 
   10 August 2017 
 
   Wentworth Resources Limited 
 
   ("Wentworth" or the "Company") 
 
   Q2 2017 and Half Year Financial Statements and MD&A 
 
   Wentworth Resources Limited, the Oslo Stock Exchange (OSE: WRL) and 
London Stock Exchange (AIM: WRL) listed independent, East Africa-focused 
oil & gas company, today announces its results for the quarter and six 
months ended 30 June 2017. 
 
   The following should be read in conjunction with the Q2 2017 Management 
Discussion and Analysis and Financial Statements which are available on 
the Company's updated website at http://www.wentworthresources.com. 
 
   Corporate 
 
 
   -- On 23 May 2017, the Company completed a private placement and issued 
      16,953,496 new common shares, for cash consideration of $0.326 (GBP 0.25 
      or NOK 2.73) per share for total gross proceeds of $5.53 million (GBP4.2 
      million or NOK46.3 million). 
 
 
   Financial 
 
 
   -- Gas sales revenue of $2.15 million for the quarter, compared to $2.94 
      million in Q1 2017 and $3.43 million in Q2 2016.    For the Half-year 
      2017 revenue was $5.10 million compared to $6.64 million in 2016. 
 
   -- Net loss of $1.25 million and $1.66 million in Q2 and Half-year 2017 
      compared to net losses of $0.17 million and $1.08 in 2016 respectively. 
 
   -- Capital expenditures of $0.61 million during Q2 and $1.3 million during 
      Half-year 2017 which compares to $2.16 million and $2.82 million in 2016 
      respectively. 
 
   -- Cash and cash equivalents on hand of $3.83 million compared with $0.98 
      million on hand at December 31, 2016. 
 
   -- Working capital of $9.08 million compared to $4.96 million at December 
      31, 2016. 
 
   -- Drew $0.56 million on new overdraft credit facility for working capital 
      purposes during Q2 2017. 
 
 
   Operational 
 
   Tanzania 
 
 
   -- Following 2016, a year in which gas demand varied significantly on a 
      month to month basis as existing government owned gas infrastructure was 
      upgraded, new infrastructure was commissioned and industry participation 
      in the gas supply and electrical power generation was established, gas 
      demand started to stabilise in the first half of 2017. 
 
   -- Since the end of the wet season during Q2 2017 when hydro power 
      generation is at its annual peak, gas production volumes have increased 
      substantially. 
 
   -- The Mnazi Bay field achieved average gross daily gas production during 
      the quarter of 30.7 MMscf/d and 36.9 MMscf/d during the first half of 
      2017, with June 2017 production averaging 44.3 MMscf/d.  Gross gas sales 
      for Q2 to date have reached over 60 MMscf/d with management's forecast 
      for the full year 2017 remaining within the guided range of 40 to 50 
      MMscf/d. 
 
   -- Managed working capital with focus on petitioning purchasers of gas to 
      improve the timeliness of settling amounts owing and working with our two 
      main creditors, local banks and the operator of the Manzi Bay Concession, 
      to pay obligations upon settlement of receivables. 
 
 
   Mozambique 
 
 
   -- Proceeding with plan to commence the drilling of an appraisal well on the 
      Tembo discovery next year, before acquiring additional seismic if 
      necessary. Consideration to acquiring additional seismic will be 
      contingent upon the results of the appraisal well. 
 
   -- Continued work on reprocessing existing 2-D vibroseis seismic data, 
      completed Tembo-1 well analysis and continued mapping and interpretation 
      of all existing data with a view to selecting a well location. 
 
   -- Continued the process of securing an industry partner to participate in 
      the appraisal programme in advance of drilling an appraisal well. 
 
 
   Geoff Bury, Managing Director, commented: 
 
   "Second quarter production was impacted by the rainy season during which 
hydro power generation is used as a substitute for gas-fired power 
generation but production rebounded to an average for July of 61 MMscf/d 
and we continue to maintain an average production guidance for the year 
of between 40 and 50 MMscf/d. 
 
   The Company is effectively managing working capital through a period of 
slower payments from its government agency customers TPDC and TANESCO. 
These efforts include being fully engaged with Maurel & Prom and our 
local Tanzania based banking institutions to effectively settle 
obligations as cash flows improve through higher production volumes. 
 
   We continue to advance the process of securing a farm-in partner for the 
drilling of an appraisal well in Mozambique and have received very 
positive initial interest from industry. The Mozambique government has 
expressed their support for the drilling of an appraisal well in 2018 in 
advance of the need to acquire new seismic data over the gas discovery 
area. The Company is currently determining a well location and expects 
to secure a farm-in partner before the commencement of drilling 
operations." 
 
   A conference call for investors, analysts and other interested parties 
will be held this morning at 01.30 MDT (Calgary) / 08.30 BST (London) / 
09.30 CEST (Oslo). 
 
   Call in numbers: 
 
   Please dial in 5-10 minutes prior to the start time and join the call by 
referencing "Wentworth Q2 
 
   Results". 
 
   Participant Std International Dial-In: [phone] 
 
   Participant UK LocalCall Dial-In Number: 
 
   United Kingdom, LocalCall: 08448719456 
 
   Norway: 21033911 
 
   Participant FreeCall Dial in numbers: 
 
   Canada: 18669923610 
 
   France: 0805110467 
 
   Norway: 80016886 
 
   United States: 18663899778 
 
   -Ends- 
 
 
 
 
Enquiries: 
 
              Lance Mierendorf,                                            [e-mail] 
Wentworth      Chief Financial Officer                                                 [phone] 
              Katherine Roe                                                 [e-mail] 
               Vice President Corporate Development & Investor Relations               [phone] 
Crux          Investor Relations Adviser 
 Advisers      (Norway)                                                                             [phone] 
              Carl Bachke 
Stifel 
 Nicolaus 
 Europe 
 Limited      AIM Nominated Adviser and Broker (UK)                                           [phone] 
              Callum Stewart 
               Nicholas Rhodes 
              Ashton Clanfield 
GMP 
 FirstEnergy  Broker (UK)                                                                     [phone] 
 Hugh Sanderson 
FTI           Investor Relations Adviser (UK)                              [e-mail] 
 Consulting                                                                 [phone] 
 Edward Westropp 
 
 
 
   Financial Statements 
 
   The following primary statements have been extracted from the Q2 2017 
unaudited consolidated financial statements which are located on the 
Company's website at www.wentworthresources.com. 
 
   WENTWORTH RESOURCES LIMITED 
 
   Unaudited Condensed Consolidated Interim Statement of Financial Position 
 
   United States $000s, unless otherwise stated 
 
 
 
 
                                           June 30,   December 31, 
                                              2017        2016 
ASSETS 
Current assets 
Cash and cash equivalents                      3,833           979 
Trade and other receivables                    9,624         6,699 
Prepayments and deposits                         175           187 
Current portion of long-term receivables      11,454        12,283 
                                              25,086        20,148 
Non-current assets 
Long-term receivables                         14,608        18,034 
Exploration and evaluation assets             46,455        45,538 
Property, plant and equipment                 92,196        93,366 
Deferred tax asset                            31,372        31,145 
                                             184,631       188,083 
Total assets                                 209,717       208,231 
 
LIABILITIES 
Current liabilities 
Overdraft credit facility                        558             - 
Trade and other payables                       8,234         8,675 
Current portion of long-term loans             5,924         5,258 
Current portion of other liability             1,290         1,260 
                                              16,006        15,193 
Non-current liabilities 
Long-term loans                               12,528        15,254 
Other liability                                1,030         1,100 
Decommissioning provision                        819           773 
                                              14,377        17,127 
Equity 
Share capital                                416,426       411,493 
Equity reserve                                26,420        26,275 
Accumulated deficit                        (263,512)     (261,857) 
                                             179,334       175,911 
Total liabilities and equity                 209,717       208,231 
 
 
   WENTWORTH RESOURCES LIMITED 
 
   Unaudited Condensed Consolidated Interim Statement of Comprehensive Loss 
 
   United States $000s, unless otherwise stated 
 
 
 
 
                     Three months ended June 30,     Six months ended June 30, 
                         2017           2016           2017           2016 
 
Total revenue                2,152          3,430          5,096         6,636 
 
Operating expenses 
Production and 
 operating                   (903)          (773)        (1,813)       (1,670) 
General and 
 administrative            (1,084)        (1,556)        (2,014)       (3,068) 
Depreciation and 
 depletion                   (654)        (1,189)        (1,548)       (2,303) 
Share based 
 compensation                 (37)          (136)          (145)         (364) 
Loss from operating 

 activities                  (526)          (224)          (424)         (769) 
 
Finance income                 370          1,072            991         2,339 
Finance costs                (597)        (1,062)        (2,449)       (2,270) 
Loss before tax              (753)          (214)        (1,882)         (700) 
 
Deferred tax 
 recovery/(expense)          (493)             40            227         (379) 
 
Net loss and 
 comprehensive 
 loss                      (1,246)          (174)        (1,655)       (1,079) 
 
Net loss per 
ordinary share 
Basic and diluted 
 (US$/share)                (0.01)              -         (0.01)        (0.01) 
 
   WENTWORTH RESOURCES LIMITED 
 
   Unaudited Condensed Consolidated Interim Statement of Changes in Equity 
 
   United States $000s, unless otherwise stated 
 
 
 
 
 
                                                                                 Accumulated    Total 
                  Note    Number of shares    Share capital    Equity reserve      deficit      equity 
                                                   $                $                $           $ 
 
 
Balance at 
 December 31, 
 2015                          169,534,969          411,493            25,683      (256,765)   180,411 
Net loss and 
 comprehensive 
 loss                                    -                -                 -        (1,079)   (1,079) 
Share based 
 compensation       10                   -                -               364              -       364 
Balance at 
 June 30, 
 2016                          169,534,969          411,493            26,047      (257,844)   179,696 
 
 
 
Balance at 
 December 31, 
 2016                          169,534,969          411,493            26,275      (261,857)   175,911 
Net loss and 
 comprehensive 
 loss                                    -                -                 -        (1,655)   (1,655) 
Share based 
 compensation       10                   -                -               145              -       145 
Issue of share 
 capital            11          16,953,496            5,527                 -              -     5,527 
Share issue 
 costs, net of 
 tax                11                   -            (594)                 -              -     (594) 
Balance at 
 June 30, 
 2017                          186,488,465          416,426            26,420      (263,512)   179,334 
 
 
   WENTWORTH RESOURCES LIMITED 
 
   Unaudited Condensed Consolidated Interim Statement of Cash Flows 
 
   United States $000s, unless otherwise stated 
 
 
 
 
                                       Three months ended     Six months ended 
                                             June 30                  June 30, 
                                        2017       2016       2017      2016 
 
Operating activities 
Net loss for the period                 (1,246)      (174)   (1,655)   (1,079) 
Adjustments for: 
Depreciation and depletion                  654      1,189     1,548     2,303 
Finance costs/(income), net                 227       (10)     1,458      (69) 
 Deferred tax expense/(recovery)            493       (40)     (227)       379 
Share based compensation                     37        136       145       364 
Change in non-cash working capital        (827)       (88)   (1,851)   (1,027) 
Net cash (utilized in)/generated 
from operating activities                 (662)      1,013     (582)       871 
 
Investing activities 
Additions to evaluation and 
 exploration assets                       (506)          -     (950)         - 
Additions to property, plant and 
 equipment                                (174)        (9)     (391)       (9) 
Reductions of long-term receivable        1,411      2,699     2,400     5,295 
Net cash from investing activities          731      2,690     1,059     5,286 
 
Financing activities 
Issue of share capital, net of issue 
 costs                                    4,933          -     4,933         - 
Principal payments                      (2,000)    (1,000)   (2,014)   (1,000) 
Debt restructuring fee                        -          -      (83)         - 
Draw on overdraft credit facility           558          -       558         - 
Interest paid                             (182)      (251)     (966)   (1,024) 
Payment of other liability                    -      (221)      (51)     (594) 
Net cash from/ (used in) financing 
 activities                               3,309    (1,472)     2,377   (2,618) 
 
 
Net change in cash and cash 
 equivalents                              3,378      2,231     2,854     3,539 
Cash and cash equivalents, beginning 
 of the period                              455      4,054       979     2,746 
Cash and cash equivalents, end of 
 the period                               3,833      6,285     3,833     6,285 
 
 
 
 
   About Wentworth Resources 
 
   Wentworth Resources is a publicly traded (OSE:WRL, AIM:WRL), independent 
oil & gas company with: natural gas production; exploration and 
appraisal opportunities; and large-scale gas monetisation initiatives, 
all in the Rovuma Delta Basin of coastal southern Tanzania and northern 
Mozambique. 
 
   Cautionary note regarding forward-looking statements 
 
   This press release may contain certain forward-looking information.  The 
words "expect", "anticipate", believe", "estimate", "may", "will", 
"should", "intend", "forecast", "plan", and similar expressions are used 
to identify forward looking information. 
 
   The forward-looking statements contained in this press release are based 
on management's beliefs, estimates and opinions on the date the 
statements are made in light of management's experience, current 
conditions and expected future development in the areas in which 
Wentworth is currently active and other factors management believes are 
appropriate in the circumstances. Wentworth undertakes no obligation to 
update publicly or revise any forward-looking statements or information, 
whether as a result of new information, future events or otherwise, 
unless required by applicable law. 
 
   Readers are cautioned not to place undue reliance on forward-looking 
information. By their nature, forward-looking statements are subject to 
numerous assumptions, risks and uncertainties that contribute to the 
possibility that the predicted outcome will not occur, including some of 
which are beyond Wentworth's control.  These assumptions and risks 
include, but are not limited to: the risks associated with the oil and 
gas industry in general such as operational risks in exploration, 
development and production, delays or changes in plans with respect to 
exploration or development projects or capital expenditures, the 
imprecision of resource and reserve estimates, assumptions regarding the 
timing and costs relating to production and development as well as the 
availability and price of labour and equipment, volatility of and 
assumptions regarding commodity prices and exchange rates, marketing and 
transportation risks, environmental risks, competition, the ability to 
access sufficient capital from internal and external sources and changes 
in applicable law.  Additionally, there are economic, political, social 
and other risks inherent in carrying on business in Tanzania and 
Mozambique. There can be no assurance that forward-looking statements 
will prove to be accurate as actual results and future events could vary 
or differ materially from those anticipated in such statements. See 
Wentworth's Management's Discussion and Analysis for the year ended 
December 31, 2014, available on Wentworth's website, for further 
description of the risks and uncertainties associated with Wentworth's 
business. 
 
   Notice 
 
   Neither the Oslo Stock Exchange nor the AIM Market of the London Stock 
Exchange has reviewed this press release and neither accepts 
responsibility for the adequacy or accuracy of this press release. 
 
   This information is subject of the disclosure requirements pursuant to 
section 5-12 of the Norwegian Securities Trading Act. 
 
   This information is subject to the disclosure requirements pursuant to 
section 5-12 of the Norwegian Securities Trading Act. 
 
   Q2 2017 Financial Statements: 
http://hugin.info/136496/R/2126572/811962.pdf 
   Q2 2017 MDA: http://hugin.info/136496/R/2126572/811963.pdf 
   170810 Press Release: http://hugin.info/136496/R/2126572/811964.pdf 
 
   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: Wentworth Resources Limited via Globenewswire 
 
 
  http://www.wentworthresources.com/ 
 

(END) Dow Jones Newswires

August 10, 2017 02:00 ET (06:00 GMT)

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