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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Aggregated Micro Power Holdings Plc | LSE:AMPH | London | Ordinary Share | GB00BC4F3V69 | ORD 0.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 92.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMAMPH
RNS Number : 3141K
Aggregated Micro Power Holdings PLC
13 December 2018
Aggregated Micro Power Holdings plc
("AMP", the "Group" or the "Company")
Interim Results for the six months ended 30 September 2018
Aggregated Micro Power Holdings plc (AIM: AMPH), trading as AMP Clean Energy, the specialist provider of distributed heat, power and renewable fuels, is pleased to announce results for the six months ended 30 September 2018.
Financial Highlights
-- Group revenues increased 55% to GBP17.39m (2017: GBP11.2m). -- Gross profit increased 22% to GBP3.29m (2017: GBP2.7m). -- Loss after tax increased to GBP3.54m (2017: GBP2.4m). -- Net assets as at 30 September 2018 were GBP14.39m (31 March 2018: GBP18.1m).
-- In May, AMP underwent a capital reduction to create distributable reserves to enable the Company to make dividend payments in the future.
-- The balance sheet does not include any recognition for future deferred development fees that may be due from AMPIL(a) .
Operational Highlights
-- Wood fuels business delivered over 80,000 tonnes of RHI compliant wood pellet and wood chip to nearly 4,000 customers and provides service and maintenance to around 900 boilers.
-- Over the summer, the Group successfully integrated the Wood Fuels segment into a single business unit.
-- The Project Development segment saw increased profits in part reflecting the sale of AMP's equity in a 20MW grid balancing project.
Post Period End
-- On 15 October 2018, AMP announced a successful GBP8.5m placing of new ordinary shares at 100 pence per ordinary share.
-- On 8 November 2018, the Company issued a Call Notice for the GBP10.01m nominal of 8% Convertible Loan Notes ("CLNs").
-- On 11 December 2018, AMP announced that 91.2% of the CLNs converted into 11,702,811 new Ordinary Shares and only GBP0.88m nominal of outstanding CLN holders opted to redeem their CLNs at par.
-- IncubEx(b) , in conjunction with Nodal Exchange, launched a suite of North American Environmental products in November.
-- All Group brands were consolidated under a single brand: AMP Clean Energy as from 11 December 2018 in order to improve customer service and cross-sell clean energy activities across the Group.
-- Urban Reserve has developed a strong pipeline of projects and is targeting 40MW - 50MW of projects with planning permission by the end of March 2019.
Richard Burrell, Chief Executive of Aggregated Micro Power Holdings plc, said:
"Group revenues have grown significantly year on year and our balance sheet has been simplified and strengthened by the recent equity fund raise and the conversion of loan notes into equity. With our growing pipeline of Urban Reserve projects, the strength of our position in the wood fuels market and with the winter heating season now upon us, we look forward to the remainder of the financial year with confidence."
(a) Aggregated Micro Power Infrastructure 2 Limited ("AMPIL") is a special purpose vehicle which is wholly owned by Law Debenture Intermediary Corporation plc as trustee for general charitable purposes. AMPIL can issue listed loan notes to fund renewable energy projects acquired from AMP and/or other developers. AMPIL has to date raised GBP52m from institutional and other investors.
(b) IncubEx LLC is an incubator for exchange traded products, services, and technology solutions. At its core, IncubEx is a product and business development firm. The company works in conjunction with its global exchange partner, European Energy Exchange (EEX) and other leading service providers and stakeholders to design and develop new financial products in global environmental, reinsurance, and related commodity markets. The company has a specific focus on innovation and continuous improvement of products and services, including technology, trading solutions, and operational efficiencies. The IncubEx team is comprised of former key Climate Exchange executives and is uniquely positioned to capture these opportunities with its partners. The company was founded in 2016 and currently has offices in Chicago and London. www.theincubex.com
The Company notifies a change to its corporate website address, which includes the information required by Rule 26 of the AIM Rules for Companies, now being www.ampcleanenergy.com.
Contacts
Aggregated Micro Power Holdings plc 020 7382 7800
Neil Eckert, Executive Chairman
Richard Burrell, CEO
Izzy Deterding, Investor Relations
finnCap Ltd 020 7220 0500
Ed Frisby / Simon Hicks (Corporate Finance)
Andrew Burdis / Richard Chambers (ECM)
Whitman Howard Ltd 020 7659 1234
Mark Murphy
Nick Lovering / Francis North
About Aggregated Micro Power Holdings plc
The Group was established to develop, own and operate renewable energy generating facilities. It specialises in the sale of wood fuels and in the installation of distributed energy projects. Trading as AMP Clean Energy, the Group sells high quality wood chip and wood pellet to end customers throughout the UK, while its projects division installs biomass boiler and biomass CHP systems for a wide range of applications and customers. AMP is also active in developing projects for stand-by power generation which aim to balance the transmission grid at times of peak demand.
www.ampcleanenergy.com
The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014.
Executive Chairman's Statement
This Interim Report is in respect of the six month period to 30 September 2018.
Interim Results
Group revenues for the six months to 30 September 2018 increased 55% to GBP17.39m (2017: GBP11.2m), gross profit increased 22% to GBP3.29m (2017: GBP2.7m) and loss after tax increased to GBP3.54m (2017: loss of GBP2.4m).
These Interim Results reflect the seasonal reliance inherent in our wood fuels business as most of our turnover and future income is budgeted to be generated in the second half of the financial year (October through to March) where the heating season is at its busiest. Similarly, our project development business expects to complete or reach financial close on a number of projects during the second half of the financial year which is in line with budget and our prior year experience.
Net assets as at 30 September 2018 were GBP14.39m (31 March 2018: GBP18.1m). The balance sheet does not include any recognition for future deferred development fees that may be due from Aggregated Micro Power Infrastructure 2 plc ("AMPIL").
On 11 April 2018, the Company announced that it had received approval at a General Meeting of the resolution which proposed a reduction in the capital of the Company. The purpose of the Capital Reduction is to create distributable reserves.
Interim Review
AMP operates through three business divisions: Wood Fuels; Project Development; and Investments.
AMP's subsidiaries sell high quality, RHI compliant, wood chip and wood pellet to end customers throughout the UK in the form of fuel only contracts, heat contracts and/or fuels plus operation and maintenance. AMP sells fuel to around 4,000 customers and provides service and maintenance to over 900 biomass systems.
Wood Fuels Segment
Revenues from the Wood Fuels segment increased 60% to GBP16.7m (2017: GBP10.4m), gross profit increased 35% to GBP2.8m (2017: GBP2.1m) and the loss for the period increased to GBP2.3m (2017: loss of GBP0.9m). The increased loss reflects the warm weather and the seasonal nature of the Wood Fuels segment where revenues and gross profit were not sufficient to cover the fixed costs of our fleet and depots during the summer months. During the first six months of this financial year, volumes were also lower due to the very hot weather in May, June, July and August. At the same time, there were a number of planned integration costs which were expensed during the period in relation to combining the Forest Fuels, Billington Bio-energy, CPL and Patchwork operations together into a single business unit.
Project Development Segment
AMP's project development division aims to deliver cost and carbon savings to high intensity heat and power users. AMP also develops gas-fired peaking plants which provide flexible generation at times of peak demand and this business is branded Urban Reserve where development is increasingly concentrated on smaller sites in areas of high electricity demand in industrial and urban areas. These sites can be connected to the distribution network at lower voltage levels in areas where grid constraints offer significant system benefits in terms of avoided grid reinforcement costs and will potentially support the anticipated growth in electric vehicles and the electrification of heat. The recent suspension of the Capacity Market is unlikely to impact the development pipeline of Urban Reserve as forecast Capacity Market revenues in Urban Reserve projects are a relatively small proportion of the anticipated income stack and we expect that the most likely outcome in any event is that the European Commission will re-approve the existing Capacity Market in its current or a broadly similar form.
Revenues from the Project Development segment were GBP0.7m (2017: GBP0.9m), gross profit was GBP0.4m (2017: GBP0.6m) and the profit for the period increased to GBP0.4m (2017: GBP0.1m). Revenues and profits from Project Development reflect a combination of fees received from AMPIL in respect of biomass assets purchased and the sale of AMP's Investment in Warne Road, a 20MW grid balancing development asset which is now outside the scope of Urban Reserve which resulted in a profit of GBP923,000.
Investments Segment
AMP Investments aim to grow assets under management and to build up off-balance sheet deferred development fees and carried interest together with making long term equity investments in companies aligned to our corporate strategy. It also includes the overhead costs of the Board and related PLC expenses.
AMP owns a 29.08% of IncubEx which is a business set up to design and promote financial products in environmental, energy, power and weather markets. On 16(th) November 2018 IncubEx launched a suite of North American products in partnership with Nodal, EEX's US Power Exchange. IncubEx revenues are starting to grow due to EEX's increased market share in European Union Allowances ("EUAs"). In Q3, this has grown by 216% to 18.99% (2017: 8.78%). In the EUA option market, EEX's market share in the nine months to 30 September 2018 has increased to 30.88% (2017: 0%).
Full Year Outlook
On 15 October 2018, AMP announced a successful placing of new Ordinary Shares raising gross proceeds of GBP8.5m at a price of 100 pence per share. This placing was supported by existing and a number of new institutional and other investors.
Proceeds from the placing enabled the Company to issue a Redemption Notice in respect of the GBP10.01m of 8% Convertible Loan Notes outstanding and on 10(th) December 2018, it was confirmed that GBP0.88m of CLNs were redeemed at par and GBP9.13m were converted into 11,702,811 new Ordinary Shares.
The remainder of the net proceeds of the placing amounting to GBP7.2m will be used for the Wood Fuels business working capital and investment in growth, Urban Reserve and investment in our service and maintenance business.
On 5(th) December 2018 we launched the consolidation of all of our wholly owned businesses under a new single group brand identity - AMP Clean Energy. This new brand is being rolled out across the business during the remainder of the financial year. We believe this will significantly improve the customer experience and enable us to be more effective in the cross-sell of our clean energy activities across the Group.
The Board expects group turnover to be in excess of GBP50m for the full year as the second half of the financial year is when the heating season is at its busiest. With the strength of our position in the wood fuels market and our growing pipeline of project developments in biomass and Urban Reserve, we look forward to the future with confidence.
Neil Eckert, Executive Chairman
12 December 2018
INDEPENT REVIEW REPORT TO Aggregated micro power holdings plc
Introduction
We have been engaged by the Company to review the set of financial statements in the half-yearly financial report for the six months ended 30 September 2018 which comprises the Consolidated statement of comprehensive income, Consolidated statement of financial position, Consolidated statement of changes in equity, Consolidated statement of cash flows and the accompanying notes to the Consolidated financial statements.
We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the set of financial statements.
Directors' responsibilities
The interim report, including the financial information contained therein, is the responsibility of and has been approved by the directors. The directors are responsible for preparing the interim report in accordance with the rules of the London Stock Exchange for companies trading securities on AIM which require that the half-yearly report be presented and prepared in a form consistent with that which will be adopted in the Company's annual accounts having regard to the accounting standards applicable to such annual accounts.
Our responsibility
Our responsibility is to express to the Company a conclusion on the set of financial statements in the half-yearly financial report based on our review.
Our report has been prepared in accordance with the terms of our engagement to assist the Company in meeting the requirements of the rules of the London Stock Exchange for companies trading securities on AIM and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity", issued by the Financial Reporting Council for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the set of financial statements in the half-yearly financial report for the six months ended 30 September 2018 is not prepared, in all material respects, in accordance with the rules of the London Stock Exchange for companies trading securities on AIM.
BDO LLP
Chartered Accountants
London
Date:
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
Consolidated statement of comprehensive income
For the six months ended 30 September 2018
Hot Features
Premium
Six months Six months Year ended
ended ended
30 Sep 2018 30 Sep 17 31 Mar 18
Unaudited Unaudited Audited
Note GBP GBP GBP
Continuing operations
Revenue 3 17,391,663 11,249,021 43,162,969
Cost of sales 3 (14,106,336) (8,578,439) (33,669,621)
------------- ------------ -------------
Gross profit 3,285,327 2,670,582 9,493,348
Other operating income 3 69,911 256,096 127,702
Profit on disposal of investment 923,135 - -
Administrative expenses (7,179,122) (4,641,312) (11,115,929)
Non-recurring administrative - - (461,951)
Restructuring expenses incurred - - (1,119,046)
Restructuring provision - - (569,678)
----------------------------------- ----- ------------- ------------ -------------
Total Administrative costs (7,179,122) (4,641,312) (13,266,604)
Fair value adjustment on
deferred consideration - - (848,194)
Gain on financial asset at
fair value through profit
or loss - (90,729) 7,507,175
----------------------------------- ----- ------------- ------------ -------------
(Loss)/Profit from operations (2,900,748) (1,805,363) 3,013,427
Finance income - 142 3,105
Finance expense 5 (670,112) (664,404) (1,353,830)
------------- ------------ -------------
(Loss)/Profit before tax (3,570,860) (2,469,625) 1,662,702
Tax credit 34,174 30,982 255,775
------------- ------------ -------------
(Loss)/Profit for the year
and other total comprehensive
losses for the period (3,536,686) (2,438,643) 1,918,477
(Loss)/Profit for the year
attributable to:
Owners of the parent (3,500,374) (2,375,179) 1,935,947
Non-controlling interest (36,312) (63,464) (17,470)
(3,536,686) (2,438,643) 1,918,477
============= ============ =============
Basic and diluted (loss)/earnings
per share attributable to
the ordinary equity holders
of the parent 10 (8.10) (6.28) 4.85
Company number: 08372177
Consolidated statement of financial position
As at 30 September 2018
30 Sep 2018 30 Sep 2017 Restated
31 Mar 2018
Unaudited Unaudited Audited
Note GBP GBP
Non-current assets
Property, plant and equipment 4 5,991,220 3,842,895 6,314,203
Investment in associate 11,410,120 2,286,975 11,410,120
Intangibles 6 9,914,093 9,755,671 10,138,105
Total non-current assets 27,315,433 15,885,541 27,862,428
------------- ------------- -------------
Current assets
Inventories 8,329,972 4,216,033 4,712,496
Trade and other receivables 7,817,079 7,187,559 12,013,708
Cash and cash equivalents 531,094 775,025 4,161,375
Total current assets 16,678,145 12,178,617 20,887,579
------------- ------------- -------------
Total assets 43,993,578 28,064,158 48,750,007
------------- ------------- -------------
Current liabilities
Trade and other payables 7 16,487,424 9,281,442 17,660,755
Provisions 397,963 - 569,678
Loans and borrowings 8 597,313 431,474 631,244
Total current liabilities 17,482,700 9,712,916 18,861,677
------------- ------------- -------------
Non-current liabilities
Loans and borrowings 8 10,656,053 9,306,298 10,304,022
Deferred Consideration 812,039 8,218 812,039
Deferred tax liability 652,412 656,373 695,157
Total non-current liabilities 12,120,504 9,970,889 11,811,218
------------- ------------- -------------
Total liabilities 29,603,204 19,683,805 30,672,895
------------- ------------- -------------
Net assets 14,390,374 8,380,353 18,077,111
------------- ------------- -------------
Equity attributable to equity
shareholders of the
parent company
Paid up share capital 9 215,956 189,052 215,956
Share premium 9 - 12,519,616 16,192,845
Merger reserve 6,648,126 6,648,126 6,648,126
Other reserve 9 10,682,431 9,046,180 10,682,431
Convertible debt option reserve 994,276 1,307,837 1,149,255
Retained deficit (4,510,091) (21,677,199) (17,207,491)
14,030,697 8,033,612 17,681,122
Non-controlling interest 359,677 346,741 395,989
------------- ------------- -------------
Total equity 14,390,374 8,380,353 18,077,111
------------- ------------- -------------
The financial statements were approved by the Directors on 12/12/18 and signed on their behalf by:
Richard Burrell, Chief Executive Officer
Consolidated statement of changes in equity
As at 30 September 2018
Total
Convertible Attributable
debt to Equity
Share Share Retained Merger Other option Holders Non-Controlling Total
capital premium deficit reserve Reserve reserve of Parent Interests Equity
GBP GBP GBP GBP GBP GBP GBP GBP GBP
Equity as at
1 April 2017 189,052 12,519,616 (19,447,786) 6,648,126 9,046,180 1,453,603 10,408,791 - 10,408,791
Profits for
the period - 1,935,947 - - - 1,935,947 (17,470) 1,918,477
------------- -----------
Total
comprehensive
income - - 1,935,947 - - - 1,935,947 (17,470) 1,918,477
Issue of share
capital 26,904 3,681,229 - - 1,591,878 - 5,300,011 - 5,300,011
Equity element
of
convertible
debt - - 304,348 - - (304,348) - - -
Fair value
adjustment
of EMI Options - - - - 44,373 - 44,373 44,373
Share issue
cost - (8,000) - - - - (8,000) - (8,000)
Non-controlling
interest
arising
on acquisition - - - - - - - 413,459 413,459
Year ended 31
March 2018 215,956 16,192,845 (17,207,491) 6,648,126 10,682,431 1,149,255 17,681,122 395,989 18,077,111
======== =========== ============= ========== =========== ============ ============= ================ ===========
Total
Convertible Attributable
debt to Equity
Share Share Retained Merger Other option Holders Non-Controlling Total
capital premium deficit reserve Reserve reserve of Parent Interests Equity
GBP GBP GBP GBP GBP GBP GBP GBP GBP
Equity as at
1 April 2018 215,956 16,192,845 (17,207,491) 6,648,126 10,682,431 1,149,255 17,681,122 395,989 18,077,111
Retained
income
opening
balance
adjustment
balance (150,051) (150,051) (150,051)
-------- ------------- ------------- ---------- ----------- ------------ ------------- ---------------- ------------
Equity balance
at 1 April
2018
(restated) 215,956 16,192,845 (17,357,542) 6,648,126 10,682,431 1,149,255 17,531,071 395,989 17,927,060
Loss for the
period - (3,500,374) - - - (3,500,374) (36,312) (3,536,686)
------------- ---------------- ------------
Total
comprehensive
income - - (3,500,374) - - - (3,500,374) (36,312) (3,536,686)
Capital
reduction - (16,192,845) 16,192,845 - - - - - -
Equity element
of
convertible
debt - - 154,980 - - (154,980) - - -
Period ended
30 September
2018 215,956 - (4,510,091) 6,648,126 10,682,431 994,275 14,030,697 359,677 14,390,374
======== ============= ============= ========== =========== ============ ============= ================ ============
Share capital: Nominal value of shares issued.
Share premium: Amount subscribed for share capital in excess of the
nominal value.
Retained deficit: All other net losses and transactions with owners
(e.g. dividends) not recognised elsewhere.
Merger reserve: Created on the issue of shares on acquisition of its
subsidiary accounted for in line with the
Companies Act 2006 provisions.
Other reserve: Amount raised through the use of a cashbox structure.
Convertible debt option reserve: Amount recorded as equity on the initial
fair value measurement of issued convertible loan notes.
Capital reduction: on 11 April 2018 there was a capital reduction where
share premium was moved to retained earnings to create distributable
reserves
Consolidated statement of cash flows
For the six months ended 30 September 2018
Six months Six months
ended ended Year ended
30-Sep-18 30-Sep-17 31-Mar-18
Unaudited Unaudited Audited
Note GBP GBP GBP
Operating activities
Loss for the period after tax (3,536,686) (2,375,179) 1,918,477
Adjustments for:
IFRS 9 restatement in opening reserves (150,051) - -
Provision for restructure - - 569,678
Tax credit (34,174) (30,982) (64,624)
Interest Income - (142) (3,104)
Fair value adjustment on financial
liabilities at fair value through
profit and loss - 90,729 803,821
Gain on financial asset at fair
value through profit and loss - - (7,507,175)
(Profit)/Loss on disposal of Property,
Plant & Equipment 483 35,124 18,351
(Profit)/Loss on disposal of Investments (923,135) - -
Finance Cost 5 670,112 664,404 1,353,830
Movement in foreign exchange 136,143 - 640,099
Amortisation of intangibles 6 224,012 200,929 421,810
Depreciation of property, plant
and equipment 4 681,351 323,416 950,129
------------ ------------ ------------
Cash flows from operating activities
before changes to working capital (2,931,946) (1,091,701) (898,708)
(Increase)/decrease in inventories (2,887,340) (1,088,263) (2,371,276)
(Increase)/decrease in trade and
other receivables 5,724,572 4,358,038 (304,855)
Increase/(decrease) in trade and
other payables (933,599) (246,106) 6,536,981
------------ ------------ ------------
Cash generated/(used) from operations (1,028,313) 1,931,968 2,962,142
------------ ------------ ------------
Investing activities
Acquisition of a subsidiary, net - (343,320) -
of cash acquired
Investment in associate - - (1,500,000)
Purchase of intangibles - (9,156) -
Purchase of property, plant and
equipment 4 (472,525) (829,053) (1,661,474)
Proceeds from sale of assets 114,638 46,657 300,368
Interest received - 142 3,104
Net cash used in investing activities (357,887) (1,134,730) (2,858,002)
------------ ------------ ------------
Financing activities
Share issue cost - - (8,000)
Proceeds from invoice discounting (1,892,070) - 1,010,739
Proceeds from issue of convertible - - -
notes
Proceeds from issue of ordinary
shares - - 3,752,496
Proceeds from finance lease drawdown 644,720 - -
Payments of interest on borrowings (605,794) (368,672) (967,682)
Payments on finance lease (390,937) (472,507) (549,284)
Net cash used in financing activities (2,244,081) (841,179) 3,238,269
------------ ------------ ------------
Net increase in cash and cash equivalents (3,630,280) (43,941) 3,342,409
Cash and cash equivalents at beginning
of period 4,161,375 818,966 818,966
Cash and cash equivalents at end
of period 531,094 775,025 4,161,375
============ ============ ============
Notes to the consolidated financial statements
For the six months ended 30 September 2018
1. Basis of preparation
The financial information in these interim results is that of the holding company and all of its subsidiaries (the Group). It has been prepared in accordance with the recognition and measurement requirements of International Financial Reporting Standards as adopted for use in the EU (IFRSs).
The Group's results are considered to be affected by seasonal variations and do not yet fully reflect the positive impact of our wood fuels business acquisitions as most of this turnover and future income is anticipated to be generated in the second half of the financial year (October through to March) where the heating season is at its busiest.
The Group's annual report and accounts for the year ended 31 March 2018 have been delivered to the Registrar of Companies. The Group's independent auditor's report on those statutory accounts was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006. The comparative financial information for the year ended 31 March 2018 in this interim report does not constitute statutory accounts for that year.
The financial information for the half-years ended 30 September 2017 and 30 September 2018 is unaudited.
As at 30 September 2018 the group had GBP531k in cash and net current liabilities of GBP0.8m. The directors and management have prepared a cash ow forecast to December 2019, 12 months from the date this report has been approved, which shows the group will remain cash positive.
The directors and management note that given the seasonality of the fuels division revenues and the unpredictability of earning revenues on development fees, the forecast continues to contain sensitivity. The directors and management manage this sensitivity by:
- Risk weighting the development fee revenues based on prudent chance of success of completion;
- Managing working capital through enhanced debtor collection, constant communication with key suppliers and managing costs in line with movements in revenues;
- In May 2018 the company drew down on a short term working capital facility which has provided GBP1.75m in further funding. This facility is secured on inventory. The loan balance was repaid in full on 8th November and the group subsequently agreed to extend the facility until the 31 December 2019 to provide working capital if required;
- Monitoring other short-term credit lines available to the group;
- On 15 October 2018 the group raised GBP8.5m further funds through an equity placing with both existing shareholders and new investors;
- On 8 November the group issued a call to redeem the convertible loan notes. The total number of Convertible Loan Notes currently outstanding on the date of redemption was GBP10.01 million nominal. On 10th December 2018, it was confirmed that GBP0.88m of CLNs were redeemed at par and GBP9.13m were converted into 11,702,811 new Ordinary Shares. The directors and management have sensitised their forward looking cash flows to take account for this cash outlay in respect of CLNs redeemed at par.
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
Based on the information provided above the directors and management are con dent that the group will trade in line with the forecasts prepared and have therefore prepared the accounts on a going concern basis.
Restatement
The following figures have been restated as a result of a consolidation adjustment identified during the statutory audit of the components within the group: Inventory (decreased by GBP730k), debtors (decreased by GBP328k), other debtors (decreased by GBP286k) and trade payables (decreased by GBP1,345k). The adjustments are an elimination of intercompany balances at cost, which took place between Forest Fuels and Billington Bioenergy. There is no impact on the income statement or on the underlying net assets.
2. Significant accounting policies
The group has applied the same accounting policies and methods of computation in its interim consolidated financial statements as in its 2018 annual financial statements, except for those that relate to new standards and interpretations effective for the first time for periods beginning on (or after) 1 January 2018, and will be adopted in the 2019 annual financial statements. New standards impacting the Group that will be adopted in the interim half-yearly financial statements for the 6 months ended 30 September 2018, and which have given rise to changes in the Group's accounting policies are:
-- IFRS 9 Financial Instruments; and -- IFRS 15 Revenue from Contracts with Customers
Details of the impact these two standards have had are given below. Other new and amended standards and Interpretations issued by the IASB that will apply for the first time in the next annual financial statements are not expected to impact the Group as they are either not relevant to the Group's activities or require accounting which is consistent with the Group's current accounting policies.
IFRS 9 Financial Instruments
IFRS 9 has replaced IAS 39 Financial Instruments: Recognition and Measurement, and has had an effect on the Group in the following areas:
-- Impairment provision on financial assets measured at amortised cost (such as trade and other receivables) have been calculated in accordance with IFRS 9's expected credit loss model, which differs from the incurred loss model previously required by IAS 39. This has resulted in an increase/decrease to the impairment provision at 1 April 2018 from that previously reported of GBP48k.
The transition method requires a retrospective application for the first time adoption of IFRS 9, however the standard has allowed an exemption to not restate the comparative information with differences being recorded in opening retained earnings, these changes have been processed at the date of initial application (i.e. 1 April 2018), and presented in the statement of changes in equity for the 6 months to 30 September 2018.
IFRS 9 considerations
Classification and measurement
There was no impact to the interim consolidated financial position resulting from the Group applying the classification and measurement requirements of IFRS 9.
Impairment
The adoption of IFRS 9 has changed the Group's accounting for impairment losses for financial assets by replacing IAS 39's incurred loss approach with a forward-looking expected credit loss approach.
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
To incorporate forward-looking information into the expected credit loss model, the following information was used; the debtor's age analysis, the bad debt allowance history for the past three years, and the credit score against each customer. Management have used this information to support their assumptions when compiling a provision matrix.
The Group will apply the simplified approach on all trade receivables and contract assets.
The increase in loss allowance resulted in a reduction to opening reserves, at 1 April 2018, as follows:
Accounts affected GBP
Trade and other receivables (150,051)
----------
Total current assets (150,051)
----------
Cumulative transition
adjustment
----------
Retained Earnings 150,051
----------
IFRS 15 considerations
IFRS 15 established a five-step model to account for revenue arising from contracts with customers. Under IFRS 15, revenue is recognised at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer.
Sale of goods
The group historically recognised wood fuel sales on delivery to the customer. The Group's contracts with customers for the sale of wood fuels generally includes one performance obligation being the delivery of such wood fuel. The Group has concluded that the revenue from the sale of wood fuel should be recognised at a point in time when control of the asset is transferred to the customer which is upon delivery. This is consistent with current recognition and the adoption of IFRS 15 does not have any impact on revenue recognition on wood fuel sales.
Rendering of services
Operations and maintenance contracts
The Group's contracts with customers to provide operations and maintenance contracts includes combined services, which can be separated into two distinct services streams, being scheduled maintenance services and the emergency call out services.
Maintenance service revenue has historically been recognised on a straight line basis rather than on delivery of the service. Adoption to IFRS 15 requires revenue to be recognised when the services performance obligations i.e. the services required under the contract are completed. There is no impact at the 31 March 2019 year-end on any potential difference between revenue and delivery of the performance obligations as the contract terms run concurrently with the year end. The impact at interim is not significant and no adjustment has been made to these financial statements.
Historically emergency call out services and any spare parts used during these call outs are recognised at a point in time when the service is requested and adoption of IFRS 15 would not impact this recognition.
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
RHI support and consultancy service
The Group's RHI support and consultancy services are provided throughout the year and the revenue should be recognised over time as the services are rendered as the customers simultaneously receive and
consume the benefits provided by the Group. There is no impact on the revenue recognition following the adoption of IFRS 15.
Heat Supply sales
The Group's contracts with customers to provide heat supply sales is a combined contract which includes:
-- the delivery of wood fuel to provide the heat and -- the provision of operations and maintenance services.
Each of which have been established as distinct performance obligations with different timing of delivery. Revenue from these contracts have been recognised on a per Kilowatt-hour. Following the adoption of IFRS 15 these individual streams should be recognised when the performance obligations under each has been completed.
There are no changes to the revenue recognition on wood fuel as the contract is a heat supply contract not a wood fuel delivery contract and revenue is recognised when the wood fuel is used and the heat generated.
The operations and maintenance services revenue is a small percentage of the revenue generated from these contracts, these contracts run concurrently with the financial year. Therefore, the adoption of IFRS 15 did not have any impact on revenue recognition of the Heat supply sales.
Project revenue
The Group's contracts with customers to provide asset management services, asset development, and portfolio management service generally all have one performance obligation.
Asset management services are recognised on a straight-line basis over time, as the benefits provided by the Group are received and consumed at the same time.
Asset development fees are recognised when they are probable, which is at a point in time when projects have been brought to a financial close. Contract assets relating to costs incurred to the date of financial close are considered for impairment in line with IFRS 9 using the simplified model.
Portfolio management service fees are recognised on a straight-line basis over time, as the benefits provided by the Group are received and consumed at the same time.
Therefore, the adoption of IFRS 15 did not have any impact on revenue recognition of the above services.
Use of estimates and judgements
There have been no material revisions to the nature and amount of estimates of amounts reported in prior periods except where the implementation of IFRS 9 and IFRS 15 discussed above requires a different approach to the accounting previously applied. Significant estimates and judgements that have been required for the implementation of these new standard are:
-- estimating the lifetime losses of short-term trade receivables for the purposes of IFRS 9's expected credit loss model
-- estimating the amount of variable consideration under IFRS 15 for which it is highly unlikely there would be a significant future reversal in the future
-- assessing whether goods and services identified in some of the Group's consultancy contracts are distinct within the context of the contract and, to the extent they are, estimating the standalone selling prices for the purposes of allocating the transaction price on a relative stand-alone basis to the performance obligations identified
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
3. Segmental information
For management purposes, the Group is organised into business units based on its products and services. The results have been prepared using consistent accounting policies for each segment as detailed in Note 1 to the consolidated financial statements for the year ended 31 March 2018.
The Group was exclusively focused on UK operations. The performance of each segment is reported below.
Operating segments - Six Months Project
Ending 30 September 2018 Wood fuels development Investments Total
GBP GBP GBP GBP
Revenue 16,714,499 677,164 - 17,391,663
Cost of sales (13,868,391) (237,945) - (14,106,336)
------------- ------------- ------------- -------------
Gross profit 2,846,108 439,220 - 3,285,327
Other operating income 69,871 - 40 69,911
P&L on sale of Investments - 923,135 - 923,135
Administrative expenses (4,306,649) (955,442) (875,526) (6,137,617)
------------- ------------- ------------- -------------
EBITDA (1,390,671) 406,913 (875,486) (1,859,243)
Depreciation (613,802) - (67,549) (681,351)
Finance Expense (184,765) - (485,347) (670,112)
Amortisation Intangibles - - (224,012) (224,012)
FX Gain/(Loss) (136,143) - - (136,143)
Tax credit - - 34,174 34,174
------------- ------------- ------------- -------------
Profit / (Loss) from operations (2,325,380) 406,913 (1,618,219) (3,536,686)
============= ============= ============= =============
Segment assets 16,402,707 1,397,717 26,193,154 43,993,578
Segment liabilities (17,556,770) (1,826,471) (10,219,963) (29,603,204)
(1,154,063) (428,754) 15,973,191 14,390,374
============= ============= ============= =============
Operating segments - Six Months Project
Ending 30 September 2017 Wood Fuels development Investments Total
GBP GBP GBP GBP
Revenue 10,390,142 858,879 - 11,249,021
Cost of sales (8,281,814) (296,625) - (8,578,439)
------------- ------------- ------------ -------------
Gross profit 2,108,328 562,254 - 2,670,582
Other operating income 63,019 193,219 - 256,238
Administrative expenses (2,496,916) (697,752) (539,323) (3,733,991)
------------- ------------- ------------ -------------
Adjusted EBITDA (325,569) 57,721 (539,323) (807,171)
Depreciation (318,069) - (5,347) (323,416)
Finance Expense (172,147) - (492,257) (664,404)
Amortisation Intangibles - - (200,929) (200,929)
P&L on sale of Assets (35,124) - - (35,124)
Other Non-Recurring Costs - - (347,852) (347,852)
Fair Value Adjustment - Investment
in Associate - - (90,729) (90,729)
Tax credit - - 30,982 30,982
------------- ------------- ------------ -------------
Profit/ (Loss) from operations (850,909) 57,721 (1,645,455) (2,438,643)
============= ============= ============ =============
Segment assets 11,229,204 2,326,569 14,508,388 28,064,058
Segment liabilities (10,203,079) (337,558) (9,143,170) (19,683,805)
1,026,125 1,989,011 5,365,218 8,380,354
============= ============= ============ =============
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
4. Property, plant and equipment
Assets Plant
Under Farm Land and & Office Motor
Construction & Upgrade Buildings Machinery Equipment Vehicles Total
GBP GBP GBP GBP GBP GBP
Cost
As at 1 April
2017 47,740 6,906,294 - 2,315,931 286,753 733,157 10,289,875
------------------ -------------- ------------- -------------------- ------------------ -------------------- --------------
Additions
from
Business
Combinations - - 278,462 1,585,606 312,005 1,840,336 4,016,409
Additions for
the period 16,650 - 32,494 1,601,796 448,160 617,252 2,716,352
Disposals for
the period - - - (269,455) (169,789) (20,659) (459,903)
As at 31
March
2018 64,390 6,906,294 310,956 5,233,878 877,129 3,170,086 16,562,733
------------------ -------------- ------------- -------------------- ------------------ -------------------- --------------
Additions for
the period - - 14,188 81,898 325,577 50,861 472,524
Disposals for
the period - - - (23,500) (64,358) (44,699) (132,557)
As at 30
September
2018 64,390 6,906,294 325,084 5,292,276 1,138,348 3,176,248 16,902,700
------------------ -------------- ------------- -------------------- ------------------ -------------------- --------------
Depreciation
As at 1 April
2017 47,740 6,906,294 - 814,091 61,958 95,045 7,925,128
------------------ -------------- ------------- -------------------- ------------------ -------------------- --------------
Additions
from
Business
Combinations - - - 662,327 215,980 636,154 1,514,461
Charge for
the
period 3,000 - 17,488 670,417 70,545 188,677 950,127
Disposals for
the period - - - (132,145) (9,043) - (141,188)
As at 31
March
2018 50,740 6,906,294 17,488 2,014,691 339,441 919,876 10,248,530
------------------ -------------- ------------- -------------------- ------------------ -------------------- --------------
Charge for
the
period 7,858 - 4,437 304,366 119,336 245,354 681,351
Disposals for
the period - - - - (3,169) (15,232) (18,401)
As at 30
September
2018 58,598 6,906,294 21,925 2,319,057 455,607 1,149,998 10,911,478
------------------ -------------- ------------- -------------------- ------------------ -------------------- --------------
Net book
value
================== ============== ============= ==================== ================== ==================== ==============
As at 1 April
2017 - - - 1,501,840 224,795 638,112 2,364,747
================== ============== ============= ==================== ================== ==================== ==============
As at 31
March
2018 13,650 - 293,408 3,219,187 537,688 2,250,272 6,314,206
================== ============== ============= ==================== ================== ==================== ==============
As at 30
September
2018 5,792 - 303,159 2,973,219 682,741 2,026,312 5,991,220
================== ============== ============= ==================== ================== ==================== ==============
5 Finance expense
Period ended Period ended Year ended
30 Sep
2018 30 Sep 2017 31 Mar 2018
GBP GBP GBP
Interest expense 204,868 80,278 207,727
Convertible Loan Note interest 555,906 398,750 1,074638
Amortisation of convertible Loan
notes - 152,796 -
Finance lease (90,662) 32,580 71,465
------------- ------------- ------------
670,112 664,404 1,353,830
============= ============= ============
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
6. Intangible assets
Long term contracts
and customer relationships Brand Goodwill Total
GBP GBP GBP GBP
Cost
As at 31 March 2018 3,993,816 972,833 5,865,237 10,831,886
Additions for the period - - - -
Additions on acquisition
of subsidiary - - - -
As at 30 September
2018 3,993,816 972,833 5,865,237 10,831,886
Amortisation
As at 31 March 2018 506,210 90,271 97,300 693,781
Amortisation charge
for the period 199,691 24,321 - 224,012
Impairment of Goodwill - - - -
As at 30 September
2018 705,901 114,592 97,300 917,793
---------------------------- -------- ---------- -----------
Net book value
As at 31 March 2018 3,487,606 882,562 5,767,937 10,138,105
As at 30 September
2018 3,287,915 858,241 5,767,937 9,914,093
============================ ======== ========== ===========
7 Trade payables Restated
Period ended Period ended Year ended
30 Sep
2018 30 Sep 2017 31 Mar 2018
GBP GBP GBP
Trade payables 5,594,863 4,954,261 8,947,784
Accruals 2.568,633 1,227,226 794,429
Other payables 5,797,823 895,757 3,211,450
Invoice discounting 2,244,927 1,964,557 4,136,998
VAT payables 143,893 195,548 524,381
Employment tax and Social security 137,283 44,092 45,713
------------- ------------- ------------
16,487,424 9,281,442 17,660,755
============= ============= ============
Year Ended
Period Ended Period Ended 31 31 Mar
8 Loans and borrowings 30 Sep 2018 30 Sep 2017 2018
GBP GBP GBP
Current Liabilities
Other loan - finance lease 597,313 431,474 631,244
597,313 431,474 631,244
================ ================ ===============
Year Ended
Period Ended Period Ended 31 31 Mar
Financial Liabilities 30 Sep 2018 30 Sep 2017 2018
GBP GBP GBP
Convertible Loan Notes 9,017,824 8,713,201 8,862,845
Other loan- finance lease 1,638,229 593,097 1,441,177
10,656,053 9,306,298 10,304,022
================ ================ ===============
The fair value of non-current liabilities are not materially different to their carrying value.
Notes to the consolidated financial statements (continued)
For the six months ended 30 September 2018
9 Share Capital
31 March 2018 No of shares Issued capital Share premium Other reserves
Nos. GBP GBP GBP
Ordinary
shares of
GBP0.005
each
As at 31st March
2017 37,810,422 189,053 12,519,616 9,046,180
Issued for cash
during the
period 3,756,356 18,782 3,681,229 -
Issued as
consideration
as part of
business
combination 1,624,365 8,121 - 1,591,878
Share issue
expense - - (8,000) -
Fair value
adjustments of
EMI options - - - 44,373
As at 31 March
2018 43,191,143 215,956 16,192,845 10,682,431
========================= =================== =========================== =========================
As at 1 April 2018 43,191,143 215,956 16,192,845 10,682,431
Capital
reduction* - - (16,192,845) -
As at 30 September
2018 43,191,143 215,956 - 10,682,431
========================= =================== =========================== =========================
*on 11 April 2018 there was a capital reduction where share premium was moved to retained earnings to create distributable reserves.
10. Loss per share
Six months Six months Year ended
ended ended
30-Sep-18 30-Sep-17 31-Mar-18
Unaudited Unaudited Audited
GBP GBP GBP
(Loss)/earnings attributable to equity
holders of the company (3,500,374) (2,375,179) 1,935,947
Weighted average number of shares 43,191,143 37,810,422 39,948,247
Continuing operations basic (Pence) (8.10) (6.28) 4.85
Basic loss per share is calculated by dividing the loss attributable to equity holders of the Group by the weighted average number of ordinary shares in issue during the year. The convertible options are considered anti-dilutive because the exercise of these would have the effect of reducing the loss per share.
We have considered the impact of the Share options and convertible loan notes on the diluted EPS. These are anti-dilutive in both 2017 and 2018 and thus diluted EPS has not been presented for either year
11. Events after the reporting period
On 15 October 2018, AMP announced a successful placing of new Ordinary Shares raising gross proceeds of GBP8.5m at a price of 100 pence per share. This placing was supported by existing and a number of new investors.
Proceeds from the placing enabled the Company to issue a Redemption Notice in respect of the GBP10.01m of 8% Convertible Loan Notes outstanding and on 10(th) December 2018, it was confirmed that GBP0.88m of CLNs were redeemed at par and GBP9.13m were converted into 11,702,811 new Ordinary Shares.
The number of Ordinary Shares in issue following the admission of placing shares was 51,691,143 and this will increase to 63,393,957 shares following the issue of new Ordinary Shares which will be issued pursuant to CLN holders who have opted to convert.
On 8 November 2018 the existing loan facility of GBP1.75m provided by AMPIL was repaid, and extended until 31 December 2019 to provide working capital if required.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR FKBDBOBDDABD
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