We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register for streaming realtime charts, analysis tools, and prices.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Amedeo Res | LSE:AMED | London | Ordinary Share | GB00BZ0XVY42 | ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.50 | 2.00 | 5.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Jul 2019 to Jul 2024
TIDMAMED
RNS Number : 8218K
Amedeo Resources PLC
30 June 2014
30 June 2014
Amedeo Resources plc
("Amedeo" or the "Company")
Audited Results for the Year Ended 31 January 2014
and Notice of AGM
Amedeo, the resource and resource infrastructure and asset investment company, is pleased to announce itsconsolidated audited results for the year ended 31 January 2014.
Period highlights
-- The build of Jiangsu Yangzijiang Offshore Engineering Co. Ltd. ("YZJ Offshore") new offshore vessel yard ("New Yard") continued apace:
o wharf building commenced in October 2013;
o wharf and finger piers were nearing completion, with work on the skidway and 900 tonne gantry crane advanced and civil works and workshops 50% completed by January 2014; and
o the New Yard became operational post the year end.
-- Progress on the build of YZJ Offshore's first order, a Le Tourneau Super 116E Class design self-elevating mobile offshore jack up drilling rig ("Explorer 1") continued to quality and on schedule at YZJ Offshore's New Yard: Steel was struck in August 2013 and the customer agreed an increased specification for Explorer 1 at an increased price of US$175m in October 2013. Post the year end, in April 2014, Explorer 1's keel was laid at the New Yard.
-- Board strengthened with the addition of two experienced directors in September 2013.
-- MGR has developed well and made payments to Amedeo of GBP311,000 (US$488,000) during the year, representing over 70% of Amedeo's cash administrative costs.
-- Overall loss for the year, excluding non-cash items, reduced by 46% to GBP417,000 (US$655,000) (2013: loss of GBP771,000 (US$1,230,000)).
Glen Lau, CEO of Amedeo, commented:
"In the year ended 31 January 2014, we have continued to build on the strong foundations laid in the previous year. Substantial progress has been made in constructing YZJ's Offshore's New Yard, which post year end became operational. Progress on our first rig order, Explorer 1, is progressing to quality and to schedule. The client increased the specification of the rig with a resultant increase in its price from US$170m to US$175m. Post the year end, the keel for Explorer 1 was laid. MGR has developed well and during the year paid to Amedeo GBP311,000 (US$488,000) which covered over 70% of our cash administrative costs.
"As part of the Company's transformation we have strengthened the Board by appointing two new directors with a wealth of experience, including in building companies and in the energy resource and resource infrastructure sectors. In continuing our transformation we will be changing the accounting reference date from 31 January to 31 December. This is more typical in the resource and offshore sector generally. As a result of this change the next interim statement to be published will be for the period to 30 June 2014. In addition, with only head office expenses incurred in pounds sterling, in light of the fact that all of the current investments of the Company are in US dollars and this being the norm in the resource and infrastructure sectors, the Company shall henceforth report in US dollars.
"We look forward to continuing to build Amedeo in the coming years."
Copies of the Company's Annual Report and Accounts, together with a notice of the Annual General Meeting, are being posted today to shareholders and will be available to view and download from the Company's website www.amedeoresources.com. The Annual General Meeting of the Company is to be held at 201 Temple Chambers, Temple Avenue, London EC4Y ODT at 2.30pm on 24 July 2014.
**ENDS**
For further information please contact:
Hot Features
Premium
Amedeo Resources plc Glen Lau/Zafar Karim Tel: + 44 (0) 20 7653
9850
Daniel Stewart & Company Paul Shackleton Tel: + 44 (0) 20 7776
Plc 6550
Beaufort Securities Saif Janjua Tel: +44 (0) 20 7382
Limited 8300
Newgate Threadneedle Graham Herring Tel: + 44 (0) 20 7653
9850
Notes
Amedeo Resources plc is an investment company whose policy is to invest principally, but not exclusively, in the resources and resources infrastructure and asset sectors. Amedeo has a deep and broad global network and wide contact base in these sectors, including in East and South East Asia and the Middle East which it leverages to source and make investments. These sectors exhibit high growth and are strategically important. Amedeo is a proactive investor which assists its investee companies to grow by providing investment, expertise and contacts.
CHAIRMAN'S STATEMENT
Introduction
Amedeo Resources plc ("Amedeo" or the "Company") continues to build on the firm foundations laid last year. Progress has been made at Jiangsu Yangzijiang Offshore Engineering Co. Ltd. ("YZJ Offshore") in constructing its offshore vessel yard ("New Yard") located in Taicang, approximately 60km north west of Shanghai, as well as constructing its first offshore rig, a Le Tourneau Super 116E Class design self-elevating mobile offshore jack up drilling rig ("Explorer 1"), and in terms of attracting further potential customers to place orders with YZJ Offshore.
Progress has also been made at MGR Resources PTE Ltd ("MGR") which has, in the space of nine months, paid to Amedeo GBP311,000 (US$ 488,000), a substantial return in light of the GBP30,000 (US$49,900) equity investment and the GBP1.18m (US$1.95m) convertible loan made to MGR.
All of this has been achieved in a short 19 months since the recapitalisation of June 2012.
The directors of the Company ("Directors") believe this augurs well for Amedeo in achieving its vision of building a range of holdings in the resource, resource infrastructure and asset sectors and proactively assisting its holdings.
YZJ Offshore
Shortly after its GBP12.1m (US$18.8m) recapitalisation in June 2012, Amedeo made its largest investment to date of GBP9.6m (US$15.3m) in July 2012 by taking a 46.5% stake in YZJ Offshore Engineering Pte Ltd, ("YZJ JV"), which has a 40.0% stake in YZJ Offshore. Amedeo's partner in this venture is Yangzijiang Shipbuilding (Holdings) Pte Ltd ("Yangzijiang Holdings"), the largest non-state owned container shipbuilder in China. The New Yard is located on 1.6m square metres of prime shorefront land in Taicang that is in the ideal location for rig construction due to its deep water and absence of bridges en route to the open sea.
Progress at YZJ Offshore has been excellent. Land compacting for construction of the New Yard commenced in 2012 and, in October 2013, wharf building commenced. By January 2014, construction of the New Yard was ahead of schedule with the wharf and finger pier near completion. Work on the skidway and 900 tonne gantry crane by then was advanced and the civil works and workshops were 50% completed. Post the year end, in April 2014, the keel for the first rig order was laid at the now operational New Yard.
The New Yard is expected to be fully completed, ahead of schedule, during autumn 2014, at which point it will have capacity to build up to ten offshore rigs, four semisubmersibles and two drill ships simultaneously.
As well as commencing building the New Yard immediately after being set up in July 2012, in December 2012 YZJ Offshore won its first rig order, a US$170m order to construct an Explorer 1 for delivery in mid-2015. The winning of this order, despite the fact that the New Yard was not and would not be ready for more than 18 months, was due to Amedeo being able to partner with YZJ Holdings, which has well established facilities, the reputation of the YZJ Offshore's senior management and the strength of Amedeo management's connections.
This year, progress on Explorer 1 has been to quality and on schedule. In August 2013, we announced that YZJ Offshore was ready to "strike steel" on Explorer 1. This followed several months of detailed technical engineering work carried out by YZJ Offshore in conjunction with Explorer 1 Limited ("E1L") (the client for Explorer 1) managed by Offshore Logistics (Asia Pacific) Pte Ltd. Explorer 1 is expected to be ready for commissioning in mid-2015. In our interim statement, we reported that E1L was so pleased with progress on Explorer 1 that it increased the specification for Explorer 1 and agreed a higher price of US$175m.
Post the year end, in April 2014, we announced that the keel of Explorer 1 had been laid. Importantly, this was done at the New Yard which, as mentioned above, was by then operational. The laying of the Explorer 1 keel demonstrates YZJ Offshore's ability to construct vessels on schedule and to quality. Ramlan Ahmad, Executive Director of E1L, commented at the time "We are impressed by the dedication and professionalism shown by YZJ Offshore and how the build of its first rig, our Le Tourneau Super Enhanced 116e is progressing to quality and to schedule. YZJ Offshore's welding, painting and finish are impressive. In addition, YZJ Offshore's ability to crank out steel in accordance with the drawings vetted by our management team is most impressive." He continued that "Typically, first time builders of complex drilling machines such as our Le Tourneau Super Enhanced 116e face difficulties. With progress on schedule and to quality thus far, we are confident that YZJ Offshore will deliver our rig on schedule and to quality."
Progress on Explorer 1 is attracting significant attention to YZJ Offshore from potential new customers.
Also post the year end, in February 2014, there were media reports that YZJ Offshore had been contracted by Primepoint Drilling PTE Ltd ("Primepoint") to build two semi-submersible drilling platforms. In addition, Primepoint had agreed an option on two additional semi-submersible drilling platforms. The total order contract value with the option was approximately US$1.7bn. We confirmed the reports. Importantly, we added that the contract was subject to conditions precedent to be satisfied by Primepoint. Those conditions precedent are yet to be satisfied, and until that time the contract will not be effective. The Primepoint contract was won in the face of competition from several other yards and demonstrates that YZJ Offshore is already able to win major contracts for complex vessels from international players.
Demand for newly designed offshore vessels over the next several years is expected to be underpinned by several factors. First, almost half of the current fleet of rigs worldwide is around 30 years or more old, and with the life of a rig being 25 to 30 years, will need replacing. Second, new major discoveries are expected to be made in deep waters and this is fuelling demand for new deep water rigs. Along with the "economics of disaster", this means that the oil and gas majors are demanding high specification rigs with the latest safety features. Finally, regulation is demanding higher safety standards on rigs. Based on the current stock and new rig builds in the pipeline, there could be an undersupply by almost 200 jack-up rigs by 2020. Both Amedeo and YZJ Holdings believe the requirement to provide higher specification rigs to enable even deeper and more efficient drilling represents an excellent investment opportunity.
YZJ Offshore has had an excellent start. We look forward to its continued success over the coming years.
MGR
In April 2013, Amedeo made its second investment, this time in a ferrous metals and ore wholesaler and trader, MGR. MGR sources iron ore principally from Africa, India and the Middle East and sells on to buyers in East Asia, including China.
The logic behind this investment was two-fold. First, Amedeo is, indirectly through YZJ Offshore, a customer of the large Chinese steel mills and has good relationships with them. By investing into MGR, Amedeo has further cemented those relationships by becoming a supplier to the steel mills. Second, offshore vessel construction has long lead times in which, typically, cashflows are received some two to three years after orders are placed whereas wholesaling and trading ferrous metals provides immediate cashflow.
The investment into MGR was made by acquiring a 49% stake in MGR for GBP30,000 (US$49,900) from Fortus PTE Ltd ("Fortus"). In addition, Amedeo provided a three year 15% coupon convertible loan to MGR of up to US$1.95 million for working capital. The convertible loan can be converted at any time during the three year period at Amedeo's option into new shares in MGR at US$1 per new share. At the time the investment was made, Mr Lau was a director of Fortus. The independent directors of the Company gave careful consideration to the terms of the convertible loan and, after consulting with Daniel Stewart & Company Plc, the Company's nominated adviser, deemed the investment fair and reasonable insofar as Amedeo's shareholders were concerned. Mr Lau is no longer a director of Fortus.
In October 2013, we reported that MGR was performing well and building its reputation for sourcing and amalgamating ferrous metals from several sources. One of the rationales for making the investment in MGR was to generate immediate and recurring cashflow for Amedeo. At the end of July 2013, MGR made a dividend payment of GBP133,000 (US$210,000) to Amedeo. Since then MGR has made further payments, including interest on the convertible loan, and marketing and consultancy fees, to Amedeo. Together these amounted to GBP178,000 (US$279,000). Thus, during the year Amedeo received a total of GBP311,000 (US$488,000) from MGR. This amount represented 74% of the cash administrative costs during the year. Moreover, as a result of the continued marketing and consultancy services which Amedeo has and is providing to MGR, post the year end, Amedeo entered into a three year contract with MGR to continue to provide such services. Fees from this contract, the interest income from the convertible loan note and the regular dividends from MGR will continue to provide cashflow to Amedeo while YZJ Offshore's business develops.
By the year end, MGR was broking approximately 100,000 tonnes of iron ore per month. In the pre-close update, we reported that MGR was in advanced discussions to increase this amount further with longer term contracts. These discussions are progressing well and, in addition, discussions are underway in respect of broking other metals and ores.
China imports around 800 million tonnes of ferrous ores per annum. The majority of these imports (up to 80%) are supplied by the majors on long term contract. The remaining 20%, or 160 million tonnes per annum, is supplied with shorter term and spot contracts by a variety of smaller players. It is in this market that MGR operates. In light of the current size of MGR's operations compared to the market, there is plenty of room for the growth of MGR.
Legacy Investments
Amedeo has two legacy investments. It retains its holding of 400,000 unquoted preference shares in privately owned Pinnacle Plus Limited ("Pinnacle") and its holding of shares in Ashcourt Rowan Plc. Significant provisions have been against the former, and as at the year end, the value of the latter, traded on AIM was GBP5,355 (US$8,845).
Board Changes
In September 2013, the Board was strengthened with the appointment of Mr Zafarullah (Zafar) Karim as an Executive Director and Mr Philippe Petitpierre as a Non-Executive Director.
Zafar has over two decades of business and financial experience, including investment banking, investment and risk management, financial strategy and growing and restructuring companies. Philippe, a Swiss national, has a wealth of experience and expertise in the energy sector. He represents Switzerland on the Board of IGU (International Gas Union) and is a member of the Board of Directors of EUROGAS in Brussels. Philippe is also vice-chairman of the SWISSGAS Company and of the Swiss Gas Industry Association.
We are delighted that both Zafar and Philippe have decided to join the Board of Amedeo.
Mr Guus Berting and Mr Aamir Quraishi stepped down as Non-Executive Directors during September. We would like to take this opportunity to thank Guus and Aamir for their services to the Company.
Change of Name
With the initial investments in YZJ JV and MGR made and progressing well, and the Board having been strengthened with an Executive and Non-Executive, we renamed the Company from Creon Resources plc to Amedeo Resources plc. The word Amedeo was chosen as it would be familiar to the peoples in all the major areas of the world including South and East Asia, the Middle East and the West.
Post Year End Fund Raise
In March 2014, Amedeo raised approximately GBP5.2m (US$8.6m) in a successful and over-subscribed equity offering by issuing 521,764,569 ordinary shares at 1.0 pence per share. Following the fund raise, the Company's enlarged issued ordinary share capital comprised 3,265,384,202 ordinary shares.
GBP3.3m (US$5.1m) of the funds were utilised to fully pay up Amedeo's stake in YZJ JV.
GBP1.2m (US$1.98m) of the funds were utilised to make a loan to MGR. The loan provided by Amedeo to MGR post year end is a five year 15% coupon loan, made on the 19 June 2014.
As at the date of signature of these accounts the Group had GBP1.0m (US$1.7m) of cash and equivalent balances.
Financial Review
Review
For the year under review, the Company had revenue of GBP81,000 (US$127,000) (2013: nil (US $nil)). This was predominately due to marketing and consultancy fee income from MGR.
Administrative expenses for the year fell substantially by 44% to GBP445,000 (US$698,000) (2013: GBP744,000 (US$466,000)). The fall was primarily due to a fall of 95% in legal and professional fees to GBP17,000 (US$11,000) (2013: GBP348,000 (US$218,000)). The substantial fees incurred in the previous year were primarily related to the investment in YZJ JV. In addition, directors' remuneration was reduced significantly to GBP121,000 (US$190,000) (2013: GBP185,000 (US$295,000)). It is the policy of the Board to align director interests to those of shareholders. Consequently, wherever possible, director remuneration is heavily weighted towards equity and away from cash. With a continuing focus on costs, we expect to maintain or reduce ongoing administrative costs. The administrative costs included a share-based payment charge of GBP25,000 (US$39,000) (2013: GBP150,000 (US$239,000)), and on a cash basis were GBP420,000 (US$659,000) (2013: GBP594,000 US$(947,000)).
The share of loss related to associates was made up of a loss of GBP592,000 (US$929,000) (2013: loss of GBP148,000 (US$236,000)) associated with YZJ JV and a loss of GBP61,000 (US$95,000) (2013: GBPnil) associated with MGR. The loss associated with YZJ JV represents Amedeo's portion of the operating costs of YZJ JV, and the loss associated with MGR also represents Amedeo's portion of MGR's loss. It is important to point out that the losses of associates were non-cash items.
There was a foreign exchange loss of GBP449,000 (US$704,000) (2013: loss of GBP202,000 (US$322,000)). This was primarily due to the foreign exchange loss on loans to associates. Again, it is important to point out that the foreign exchange loss was a non-cash item.
Finance income of GBP98,000 (US$154, 000) (2013: GBPnil (US$ nil)) and dividend income of GBP133,000 (US$210,000) (2013: GBPnil (US$ nil)) were received. The dividend income of GBP69,000 included in the profit and loss account is the remaining balance after Amedeo's share of 49% was eliminated against the investment in MGR. See note 9 for details. Both these items were from (and paid by) MGR. One of the reasons for making the investment in MGR was to provide immediate cashflow for Amedeo. Together with the marketing and consultancy fee of GBP81,000 (US$127, 000) (2013: GBPnil (US$ nil)), during the year, Amedeo received GBP311,000 (US$488,000) (2013: nil) or 74% of its cash administrative costs from MGR.
Overall for the year under review, Amedeo made a loss after tax of GBP969,000 (US$1,520,000) (2013: loss of GBP1,094,000 (US$1,745,000)). Removing the non-cash items (share based payment, profit/loss due to associates and foreign exchange losses) this would have been a loss of GBP417,000 (US$655,000) (2013: loss of GBP771,000 (US$1,230,000)).
As at the year end, the carrying value on the balance sheet of investments in associates fell to GBP9,161,000 (US$14,371,000) (2013: GBP9,517,000 (US$15,093,962)). The fall was due primarily to the share of loss of associates during the year. Current assets were GBP1,589,000 (US$2,625,000) (2013: GBP1,778,000 (US$2,820,000)). As discussed above, a convertible loan was made to MGR, which at the balance sheet date was carried at GBP1,181,000 (US$1,853,000) (2013: GBPnil). Prepayments rose to GBP31,000 (US$49,000) (2013: GBP4,000 (US$6,400)) and cash fell to GBP353,000 (US$554,000) (2013: GBP1,750,000 (US$2,776,000)) primarily due to the convertible loan which was made to MGR.
Trade payables rose to GBP121,000 (US$200,000) (2013: GBP84,000 (US$133,000)).
Overall, at the year end, net assets were GBP10,629,000 (US$17,538,000) (2013: GBP11,211,000 (US$17,781,000)).
Accounting Policy, Reference Date and Reporting Currency
Amedeo is able to adopt a number of policies in relation to how it values its investments. Previously, its policy was to value investments at the balance sheet date using the Directors' valuation of fair value. The Directors have decided to adopt a more prudent approach going forward which is to hold investments at historic cost or impaired value, and value upwards only if there is a third party reference which can be used to justify any value uplift. In the case of investments in associates, Amedeo uses equity accounting to value the investments.
In addition, the Directors have decided to change the accounting reference date from 31 January to 31 December. This is more typical in the resource and offshore sector and generally. As a result of this change the next interim statement to be published will be for the period to 30 June 2014.
Finally, in light of the fact that all of the current investments of the Company account in US dollars and indeed, this is the norm in the resource and infrastructure sectors and that only head office expenses are incurred in pounds Sterling, the Company shall henceforth report in US dollars.
Outlook
With firm foundations and two investments, both of which are performing well, MGR paying fees as well as interest and dividends and a reduced cost base, Amedeo looks confidently to the future. New contracts are under discussion for the current investments and additional investments are being explored in the resource and resource infrastructure and asset sectors.
GROUP STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 January 2014
2014 2013
Note GBP'000 GBP'000
Revenue 81 -
Cost of sales (1) -
______ _______
Gross profit 80 -
Administrative expenses 3 (445) (744)
Share of loss of associates 4 (653) (148)
Foreign exchange losses 5 (449) (202)
________ ________
Loss from operations (1,467) (1,094)
Gain on purchase of associate 331 -
Dividend income 9 69 -
Finance income 98 -
_______ ________
Loss on ordinary activities before
taxation (969) (1,094)
Taxation 6 - -
_______ ________
Loss for the year (969) (1,094)
(0.04)p
Basic and diluted loss per share 7 0.03)p (0.07)p
Other Comprehensive Income
Foreign exchange translation difference 9 362 -
_______ ________
Total Comprehensive Loss for the
year (607) (1,094)
All of the Group's activities are classed as continuing and there were no recognised gains or losses in either year other than those included above.
The accompanying notes are an integral part of these financial statements.
The Company has elected to take exemption under section 408 of the Companies Act 2006 from presenting the Company statement of comprehensive income. The loss for the Company for the year was GBP642,000. (2013: GBP682,000).
STATEMENTS OF CHANGES IN EQUITY
Group
Foreign Total equity
Share Share-based currency attributable
premium payment translation Retained to equity holders
Share capital account reserve reserves earnings of parent
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 February
2012 720 3,838 - - (4,485) 73
Loss for the
year - - - - (1,094) (1,094)
Share-based
payments - - 150 - - 150
Issue of share
capital 2,417 9,665 - - - 12,082
______ ________ ________ ________ _________ ________
At 31 January
2013 3,137 13,503 150 - (5,579) 11,211
Loss for the
year - - - - (969) (969)
Share-based
payments - - 25 - 25
Foreign exchange
rereser - - - 362 - 362
______ ________ ________ ________ _________ ________
At 31 January
2014 3,137 13,503 175 362 (6,548) 10,629
______ ________ ________ ________ _________ ________
Company
Total equity
attributable
Share Share-based to equity
premium payment Retained holders of
Share capital account reserve earnings parent
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 February
2012 720 3,838 - (4,485) 73
Loss for the
year - - (682) (682)
Share-based
payments - - 150 - 150
Issue of share
capital 2,417 9,665 - - 12,082
______ ________ ________ _________ ________
At 31 January
2013 3,137 13,503 150 (5,167) 11,623
Loss for the
year - - - (642) (642)
Share-based
payments - - 25 - 25
______ ________ ________ _________ ________
At 31 January
2014 3,137 13,503 175 (5,809) 11,006
______ ________ ________ _________ ________
The accompanying notes are an integral part of these financial statements.
STATEMENTS OF FINANCIAL POSITION
as at 31 January 2014
Group Company
Assets Note 2014 2013 2014 2013
Non-current assets GBP'000 GBP'000 GBP'000 GBP'000
Investment in subsidiaries 8 - - 5 5
Investment in associates 9 9,161 9,517 - -
_____ _____ _ _
9,161 9,517 5 5
Current assets
Loans receivable 10 1,181 - 10,952 9,971
Investments in quoted
shares 11 4 4 4 4
Investment in unquoted
preference shares 12 20 20 20 20
Other receivables 13 31 4 31 4
Cash and cash equivalents 353 1,750 164 1,703
_____ ___ ______ _____
1,589 1,778 11,171 11,702
Total assets 10,750 11,295 11,176 11,707
Liabilities
Current liabilities
Trade and other payables 14 (121) (84) (170) (84)
____ ___ ____ ____
Total liabilities (121) (84) (170) (84)
_______ _______ _______ _______
Net assets 10,629 11,211 11,006 11,623
Equity
Called up share capital 15 3,137 3,137 3,137 3,137
Share premium account 13,503 13,503 13,503 13,503
Share warrant reserve 16 175 150 175 150
Foreign currency translation
reserve 9 362 - - -
Deficit (6,548) (5,579) (5,809) (5,167)
______ _______ ______ ______
Total equity 10,629 11,211 11,006 11,623
Approved by the Board and authorised for issue on 27 June 2014 and signed on behalf of the Board by
Glen Lau
Director
Registered Number 05216336
The accompanying notes are an integral part of these financial statements.
STATEMENTS OF CASH FLOWS
Group Company
2014 2013 2014 2013
GBP'000 GBP'000 GBP'000 GBP'000
Loss for the year before tax (969) (1,094) (642) (682)
Adjustments for:
Share-based payments 25 150 25 150
Share of loss of associates 653 148 - -
Gain in bargain purchase (331) - - -
Foreign exchange loss on loans - - 439 181
Foreign exchange difference 362 - - -
on associates
Change in receivables (27) (4) (27) (4)
Change in payables 37 29 86 29
Interest income (98) - - -
Dividend income (69) - - -
_______ _______ _______ _______
Cash flows from operating activities (417) (771) (119) (326)
Investing activities
Investment in associates (30) (9,665) - -
Investment in subsidiaries - - - (5)
Loans made to subsidiaries - - (1,420) (10,152)
Loans receivable given (1,181) - - -
Dividends received from associate 133 - - -
Interest income received 98 - - -
______ ______ ______ ______
Net cash used in investing
activities (980) (9,665) (1,420) (10,157)
Financing activities
Issue of share capital - 12,082 - 12,082
_______ _______ _______ _______
Net cash from financing activities - 12,082 - 12,082
_______ _______ _______ _______
Net increase in cash and equivalents (1,397) 1,646 (1,539) 1,599
Cash and equivalents at beginning
of year 1,750 104 1,703 104
Cash and equivalents at end
of year 353 1,750 164 1,703
The accompanying notes are an integral part of these financial statements.
NOTES TO THE GROUP FINANCIAL STATEMENTS
1. Accounting policies
The principal accounting policies are summarised below. They have all been applied consistently throughout the year and the preceding year unless stated.
Basis of accounting
The financial statements of the Group and the Company have been prepared in accordance with International Financial Reporting Standards, International Accounting Standards and Interpretations issued by the International Accounting Standards Board as adopted by European Union.
The financial statements have been prepared under the historical cost convention, with the exception of financial instruments.
As at the date of authorisation of these financial statements, the following standards, which have not been applied, werein issue but not yet effective (and, in some cases, had not yet been adopted by the EU):
Effective for
accounting periods
beginning on
or after:
IFRS 10 Consolidated financial statements - 1 January 2014
Identification of the
concept of control of an entity and
the requirement to
include in consolidated accounts
IFRS 11 Joint arrangements 1 January 2014
IFRS 12 Disclosure of Interests in other entities 1 January 2014
IAS 27 Amendments for investment entities 1 January 2014
IAS 28 Investment in associates 1 January 2014
It is not practicable to provide a reasonable estimate of the effect of these standards until a detailed review has been completed.
Going concern
The Directors have reviewed the current budgets and cash flow projections for a period of more than 12 months from the date of this report, which take into account the current cash balances. Accordingly, the Directors have prepared the financial statements on the going concern basis.
Basis of consolidation
Where the Company has the power, either directly or indirectly, to govern the financial and operating policies of another entity or business so as to obtain benefits from its activities, it is classified as a subsidiary. The consolidated financial statements present the results of the Company and its two subsidiary undertakings, Amedeo Resources (Asia) PTE Ltd ("Amedeo Asia") and Creon Corporation Limited ("Corporation"), the latter of which is dormant, as if they formed a single entity. Inter-company transactions and balances between Group companies are therefore eliminated in full.
Revenue
Revenue of GBP81,000 was recorded in the year ended 31 January 2014 (2013: nil). Almost all revenue was received from associate company, MGR Resources PTE Ltd ("MGR"), for the provision of marketing and consultancy services.
Investments in subsidiaries
Investment in subsidiary companies is stated at cost less provision for any impairment in value. Subsequent measurement of all investments in subsidiaries is at fair value.
Investments in unquoted and quoted shares
Investments in unquoted and quoted shares are initially measured at cost, including transaction costs. Subsequent measurement of all investments is at fair value. The fair values of listed investments are based on bid prices at the financial year end date.
Assets held by the Group at the year end include unlisted ordinary equity shares, unlisted redeemable preference shares and listed investments.
When managing its investments, the Group aims to profit from changes in the fair value of equity investments. Accordingly, all quoted equity investments are designated as "at fair value through the profit and loss" and are subsequently recorded in the statement of financial position as current assets at fair value.
Investment in associates
Where the Company, or its wholly owned subsidiaries, hold more than 20% but less than 50% of the voting control of an entity, such as Amedeo Asia's holding in YZJ Offshore Engineering Pte Ltd ("YZJ JV") and MGR, then that investment is classified as an associate and is equity accounted for, see notes 4 and 9.
Where the Company, or its wholly owned subsidiaries, hold less that 20% of the voting control of an entity, the investment is valued at cost or impaired value, and subsequently revalued upwards only if there is a third party reference which can be used to justify any value uplift. It is not the policy of the Company to apply a "Directors' Valuation".
Loans receivable
Loans receivable are valued at nominal amount less provisions against recoverability. The maximum exposure of the Company in respect of the loan portfolio at the year end is the amount receivable shown in note 11. No hedging transactions have been entered into with respect to the loan portfolio.
Impairment
At each financial year end date, the Group reviews the carrying amounts of its non-current assets with finite lives to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss. Where it is not possible to estimate the recoverable amount of the individual asset, the Group estimates that recoverable amount of the cash-generating unit to which the asset belongs.
Cash
Cash and cash equivalents comprise cash at bank and in hand.
Financial liabilities and equity
Financial liabilities and equity are classified according to the substance of the financial instrument's contractual obligations rather than the financial instrument's legal form. An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
Financial assets
The Group has only financial assets classified as loans and receivables. The Group's loans and receivables comprise loans and other receivables and cash and cash equivalents in the statement of financial position.
Trade payables
Trade payables are not interest bearing and are stated at their nominal value.
Equity instruments
Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.
Current and deferred tax
The charge for current tax is based on the results for the year as adjusted for items which are non-assessable or disallowed. It is calculated using rates that have been enacted or substantively enacted by the financial year end date. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will arise against which the temporary difference will be utilised.
Foreign currencies
The financial information is presented in United Kingdom pounds sterling which is the functional currency of the Company.
Monetary assets and liabilities denominated in foreign currencies in each company are translated at the rates of exchange prevailing at the accounting date. Transactions in foreign currencies are translated at the rate prevailing at the date of transaction.
On consolidation, revenues, costs and cash flows of undertakings abroad are included in the Group income statement at average rates of exchange for the year. The assets and liabilities denominated in foreign currencies are translated into United Kingdom pounds sterling using rates of exchange ruling at the balance sheet date.
Exchange differences on the re-translation of opening net assets and results for the year of foreign subsidiary undertakings and associates are dealt with through reserves net of differences on loans denominated in foreign currency. Other gains and losses arising from foreign currency transactions, including trading, are included in the consolidated income statement.
Share-based payments
All share-based payments are accounted for in accordance with IFRS 2 - "Share-based payments". The Company issues equity-settled share based payments in the form of share warrants to certain directors and key advisers. Equity settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date of equity-settled share-based payments is expensed on a straight line basis over the vesting period, based on the Company's estimate of shares that will eventually vest.
Fair value is estimated using a Black Scholes probability valuation model. The expected life used in the model has been adjusted, on the basis of management's best estimate for the effects of volatility of share price and exercise restrictions.
Critical accounting estimates and judgments
The Group makes certain estimates and assumptions regarding the future. Estimates and judgements are continually evaluated based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. In the future, actual experience may differ from these estimates and assumptions. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
(a) Impairment of investment in associated company:
The investment in the associated company is stated on an equity accounting basis supported by the audited financial statements of the associate. The Group is also required to determine whether any impairment loss should be recognised in accordance with IAS 39. The recoverable amount is determined based on value in use calculations. In determining the value in use, the Company estimates:
(i) its share of the present value of the estimated future cash flows expected to be generated by the associate or joint venture, including the cash flows from the operations of the associate or joint venture and the proceeds from the ultimate disposal of the investment; or
(ii) the present value of the estimated future cash flows expected to arise from dividends to be received from the investment and from its ultimate disposal.
It then compares the product of these estimates with the total carrying value of the associate.
(b) Recoverability of loans receivable:
Separately the Company determines the recoverability of its loans to its subsidiary. As the loans were used to purchase the interests in the associates, consideration of the recoverability of the loans is related to consideration of the carrying value of the associates.
(c) Share-based payments
All share-based payments are accounted for in accordance with IFRS 2 - "Share-based payments". The Company issues equity-settled share based payments in the form of share warrants to certain directors and key advisers. Equity settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date of equity-settled share-based payments is expensed on a straight line basis over the vesting period, based on the Company's estimate of shares that will eventually vest.
Fair value is estimated using a Black Scholes probability valuation model. The expected life used in the model has been adjusted, on the basis of management's best estimate for the effects of volatility of share price and exercise restrictions.
2. Segmental reporting
No segmental analysis is considered necessary as the Directors believe that the Group has only one segment in the year under review, being that of an investment company with a focus on investments in, but not exclusively, the resources and/or resources infrastructure sectors, with no specific national or regional focus.
3. Administrative expenses
Expenses included in administrative expenses (net) are analysed below
2014 2013
GBP'000 GBP'000
Administration, legal, professional
and financial costs 291 165
Directors' fees 121 185
Professional costs of acquiring
investment in associate - 354
Unrecovered VAT 33 40
______ ______
445 744
______ ______
GBP25,000 of the Directors' fees expense of GBP121,000 was the charge incurred in the issue of warrants to Directors (2013: GBP96,000). Unrecovered VAT represents input VAT incurred during the periods which the Directors have decided prudently to provide for whilst the Company was in dispute with HMRC over its ability to recover input VAT. Subsequent to year end, this VAT dispute was settled by way of payment to HMRC of GBP33,000. See note 14. The auditor's fees in the year ended 31 January 2014 were GBP25,000 (2013 - GBP19,500). In addition, fees for non-audit services in the year ended 31 January 2014 were GBP9,000 (2013 -GBPnil).
4. Share of loss of associates
2014 2013
GBP'000 GBP'000
YZJ Offshore Engineering Pte Ltd (592) (148)
MGR Resources Pte Ltd (61) -
______ ______
(653) (148)
______ ______
The Company's wholly-owned Singapore-registered subsidiary, Amedeo Asia, holds a 46.45% investment in YZJ JV, a Singapore registered company. During the year, Amedeo Asia also purchased 49% of the share capital of MGR Resources Pte Ltd, a Singapore-registered company. The loss of GBP653,000 represents Amedeo Asia's share of YZJ JV's loss for the year ended 31 December 2013 of GBP592,000 (31 December 2012: GBP148,000) and Amedeo Asia's share of MGR's loss for the year ended 31 December 2013 of GBP61,000. See note 9.
5. Foreign exchange losses
2014 2013
GBP'000 GBP'000
Loss on conversion of loans made
to subsidiary 449 202
______ ______
In March 2013, the Company made a number of foreign currency denominated, interest free, unsecured loans to its wholly owned subsidiary, Amedeo Asia, totalling US$1.95 million, to enable Amedeo Asia to make a convertible loan to MGR ("Convertible Loan"). At 31 January 2014, one such loan of US$1.47 million was translated to GBP0.89 million, resulting in an unrealised loss on foreign exchange of GBP0.04 million. See table below, which details this.
Loan from Amedeo Asia to MGR in 2013 of US$1.47m At 31 January 2014 GBP0.89m Less: At 31 January 2013 (GBP0.93)m Unrealised loss on foreign exchange GBP0.04m
At 31 January 2014, the loans of US$15.5m made to Amedeo Asia in 2012, to enable Amedeo Asia to make its investment into YJZ Offshore, were translated to GBP9.4m, resulting in an unrealised loss on foreign exchange of approximately GBP0.40 million. See table below, which details this.
Loan from Amedeo Asia to YZJ JV in 2012 of US$15.5m $15.5m At 31 January 2014 GBP9.4m Less: At 31 January 2013 (GBP9.8)m Unrealised loss on foreign exchange GBP0.4m
The Company does not hedge against movements in foreign exchange rates.
6. Taxation 2014 2013
GBP'000 GBP'000
UK Corporation tax
Factors affecting tax charge in the
year
Loss on ordinary activities before
tax (969) (1,094)
Loss on ordinary activities at the
effective rate
of corporation tax 20% (2013: 20%) (194) (219)
Unrelieved losses 194 219
- -
___ ___
Deferred income tax assets are recognised for tax losses carry-forward to the extent that the realisation of the related tax benefit through future taxable profits is probable. The Group did not recognise deferred income tax assets relating to estimated carried forward tax losses of GBP6,750,000 (2013: GBP5,800,000) as there is insufficient evidence that the asset will be recovered. The deferred income tax asset relating to these losses is GBP1,417,500 (2013: GBP1,363, 000).
7. Loss per share
The basic and diluted loss per share for the year ended 31 January 2014 was 0.04p. (2013: 0.07p loss). The calculation of loss per share is based on the loss of GBP969,000 for the year ended 31 January 2014 (2013: GBP1,094,000 loss) and the weighted average number of shares in issue during the year of 2,738,619,633 (2013: 1,666,122,339). No warrants were exercised during the year under review. 109.5 million warrants were granted in the year ended 31 January 2014, see note 16, all of which were outstanding as of 31 January 2014, which, together with the 87.0 million warrants issued in the year ended 31 January 2013, took the aggregate number of warrants outstanding at 31 January 2014 to 196.5 million (2013: 87.0 million). The outstanding warrants represent approximately 7% of the Company's current issued share capital and, due to losses, are considered by the Directors to be anti-dilutive. See note post balance sheet events note 23, for details of post year end subscription and placing.
8. Investment in subsidiaries
Company
2014 2013
Cost or valuation GBP'000 GBP'000
At 1 February 5 -
Additions - 5
_______ _______
At 31 January 5 5
_______ _______
The investment in subsidiaries shown in both 2013 and 2014 is the investment in Amedeo Asia.
The Company's subsidiaries were as follows:
Name Country of incorporation Proportion of ownership
interest at 31 January
2014 2013
Creon Corporation Ltd England 100% 100%
Amedeo Resources (Asia)
Pte Ltd ("Amedeo Asia") Singapore 100% 100%
Creon Corporation Ltd (formerly named Creon Resources Ltd) was incorporated on 24 November 2011 and acquired by the Company on 16 December 2011. It swapped names with Creon Corporation on 16 December 2011 and is dormant. Amedeo Asia was incorporated on 10 July 2012 to hold the Company's Asian based investments.
9. Investments in associates
Amedeo's wholly owned subsidiary, Amedeo Asia has a 46.45% holding in YZJ Offshore Engineering Pte Ltd, ("YZJ JV"). YZJ JV has a 40% stake in Jiangsu Yangzijiang Offshore Engineering Co. Ltd ("YZJ Offshore"). YZJ JV equity accounts for its 40% interest in YZJ Offshore, and Amedeo Asia equity accounts for its 46.45% stake in YZJ JV. Amedeo provided an interest free unsecured loan to Amedeo Asia to make the 46.45% stake in YZJ JV. See note 5. During the year, Amedeo Asia also purchased 49% stake in MGR Resources PTE Ltd ("MGR"). Amedeo Asia equity accounts for its 49% stake in MGR. MGR has a non-coterminous year end of 31 December, however, there the movement in the MGR balances between 31 December 2013 and 31 January 2014 is not material in nature.
YZJ MGR Total
2014 2013 2014 2013 2014 2013
Amounts relating to associates GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Total assets 19,253 20,515 4,561 - 23,814 20,515
Total liabilities 14 27 4,103 - 4,103 27
______ _______ _______ _______ _______ _______
Net assets 19,239 20,488 458 - 19,697 20,488
_______ _______ _______ _______ _______ _______
Group's share of net assets
of associates 8,937 9,517 224 - 9,161 9,517
_______ _______ _______ _______ _______ _______
Total revenue 2 2 31,628 - 31,630 2
Loss (1,275) (318) (124) - (1,399) (318)
_______ _______ _______ _______ _______ _______(148
Group's share of loss
of associates (592) (148) (61) - (653) (148)
_______ _______ _______ _______ _______ _______
Group's share of net assets GBP'000
of associates
Opening at 1 February 2013 9,517
Group's share of loss of
associates (653)
Elimination of group share
of dividends (1) (64)
Foreign exchange gain (2) 362
--------
Closing at 31 January 2014 9,161
--------
(1) At the end of July, MGR made a dividend payment of GBP133,000 (US$210,000) to Amedeo. This represents 100% of the dividend paid and recorded in MGR's books in 2013. Amedeo's share of the GBP133,000 (US$210,000) payment, (GBP64,000 (US$101,000)) or 49%, was eliminated against the investment in MGR in Amedeo's books with the remaining balance of GBP69,000 (US$109,000)) included in the income statement of Amedeo, as dividend income received.
(2) The foreign currency translation reserve arises upon translation of investment >20% in foreign operations.
10. Loans receivable
Group Company
2014 2013 2014 2013
GBP'000 GBP'000 GBP'000 GBP'000
Balance brought forward - - 9,971 -
Loans advanced 1,181 - 1,420 9,971
Foreign exchange loss - - (439) -
______ ______ ______ ______
Balance carried forward 1,181 - 10,952 9,971
______ ______ ______ ______
During the year, the Company made a number of interest free, unsecured and repayment on demand loans to its wholly owned subsidiary, Amedeo Asia, totalling GBP1.42 million, which, when aggregated with loans made to Amedeo Asia in the prior year, totalled GBP10.95 million at the year end (2013: GBP9.97m). During the year, the Group also made loans to its associate, MGR, of GBP1.18m (2013: GBPnil). (note 20)
The Directors consider that the carrying amount of loans receivable approximates to their fair value.
In the event of the conversion of the loan to MGR, it is not anticipated that there will be a change in control.
11. Investments in quoted shares
Group and Company
2014 2013
Cost or valuation GBP'000 GBP'000
At 1 February 4 4
Impairment provision - -
_____ _____
At 31 January 4 4
_____ _____
The investment represents 2,775 ordinary shares in the capital of Ashcourt Rowan PLC.
12. Investment in unquoted preference shares
Group and Company
2014 2013
Cost or valuation GBP'000 GBP'000
Cost 400 400
Provision brought forward (380) -
At 1 February 20 400
Provision against carrying value - (380)
_______ _______
At 31 January 20 20
_______ _______
The investment in unquoted preference shares represents 400,000 GBP1 non-voting redeemable preference shares held in Pinnacle Plus Limited ("the Preference Share") and is held at Impaired value. The Preference Shares were acquired in 2008, and accrue interest at a rate of 7.0 per cent. per annum. The Preference Shares are now due for redemption from 30 September 2013. The Company has not recognised any interest income accrued on the Preference Shares to date.
The carrying value of the Preference Shares will continue to be monitored closely by the Directors
13. Other receivables
Group Company
2014 2013 2014 2013
GBP'000 GBP'000 GBP'000 GBP'000
Prepayments and sundry
debtors 31 4 31 4
The Directors consider that the carrying amount of other receivables approximates to their fair value.
14. Trade and other payables
Current liabilities Group Company
2014 2013 2014 2013
0
GBP'000 GBP'000 GBP'000 GBP'000
Trade payables and accruals 96 59 145 59
VAT provision 25 25 25 25
______ ______ ______ ______
121 84 170 84
______ ______ ______ ______
The VAT provision of GBP25,000 represented the amount of VAT previously recovered by the Company. This amount was settled with HMRC, post year end. See note 3. The Directors consider that the carrying amount of trade and other payables approximates to their fair value.
15. Called up Share capital
2014 2013
Allotted, called up and fully paid GBP'000 GBP'000
2,738,619,633 Ordinary Shares of 0.1p
each 2,739 2,739
44,190,545 Deferred Shares of 0.9p
each 398 398
_____ ____
3,137 3,137
The 44,190,545 deferred shares of 0.9p each ("Deferred Shares") do not entitle the holder thereof to receive notice of or attend and vote at any general meeting of the Company or to receive a dividend or other distribution or to participate in any return on capital on a winding up unless the assets of the Company are in excess of GBP1,000,000,000,000. The Company retains the right to purchase the Deferred Shares from any Shareholder for a consideration of one penny in aggregate for all that shareholder's Deferred Shares. As such, the Deferred Shares effectively have no value. Share certificates have not and will not be issued in respect of the Deferred Shares.
16. Warrants
The Company had 87,000,000 outstanding warrants at the beginning of the year. During the year ended 31 January 2014, the Company issued 109,544,786 warrants, as set out in the table below.
Number of
Number of Warrants
Exercise Warrants Exercise Number at 31 Jan
Date of grant period granted/(surrendered) price exercised 2014
---------------- -------------- ----------------------- ----------- ----------- ------------
4 April 2012 4 April 2022 16,000,000 0.75 pence - 16,000,000
31 August 31 August
2012 2017 71,000,000 0.5 pence - 71,000,000
23 June 2013 23 June 2023 109,544,786 0.5 pence - 109,544,786
________ _______ ________
196,544,786 - 196,544,786
________ _______ ________
All of the warrants granted during the prior year vested in the prior year and there are no outstanding conditions to exercise. Therefore there is no charge in the current year related to the 87,000,000 warrants issued in the prior year.
On the 23 June 2013, the Company awarded 109,544,786 warrants ("Karim Warrants") to Zafar Karim. 20,996,084 of the Karim Warrants vested during the year ended 31 January 2014. The Company incurred a total charge in relation to the issue of the Karim Warrants of GBP25,104. The Directors used the Black-Scholes option model when calculating the non-cash charge. The share price used for Karim Warrants was 0.4 pence. The expected volatility of the Karim Warrants was 7%, and was based on the historic closing mid-market share price of Ordinary Shares from the date of the grant of the respective Karim Warrants to the date of this report. The Directors, having taken advice, deemed the Company's risk free interest rate to be 5%.
The following table sets out the warrants held by Directors and former Directors, or entities connected with the Directors, who served during the year and up to the date of this report:
Number of Exercise Exercise Number
Warrant holder Warrants Date of grant period price exercised
------------------- ------------ -------------- ------------- ---------- -----------
A Berting (1) 31 August 31 August
(2) 5,000,000 2012 2017 0.5 pence -
31 August 31 August
A Quraishi (1) 7,000,000 2012 2017 0.5 pence -
Fulton Capital 31 August 31 August
Management Ltd(3) 25,000,000 2012 2017 0.5 pence -
Zafar Karim 109,544,786 23 June 2013 23 June 2023 0.5 pence -
Notes
(1) Messrs Berting and Quraishi resigned as directors on 12 September 2013.
(2) Mr Berting exercised all 5,000,000 warrants post year end.
(3) Fulton Capital Management Limited is a company owned and controlled by Mr Lau, the Company's chief executive officer.
17. Asset value per share
The net asset value per share at 31 January 2014 was GBP0.0038 (31 January 2013; GBP0.0043). Net asset value is based on the net assets as at 31 January 2014 of GBP10.63 million (31 January 2013: GBP11.21 million) and on the number of Ordinary Shares in issue at 31 January 2014 being 2,738,619,633 ordinary shares (31 January 2013: 2,738,619,633).
18. Staff numbers and costs
The average monthly number of employees of the Group, including directors, during the year was 4 (2013: 4). The Directors are considered the key management of the Group. The aggregate remuneration of the Directors is set out in the remuneration report.
19. Capital commitments
There were no capital commitments at the yearend (2013 - GBPnil).
20. Related party transactions
On 10 April 2013, Amedeo Asia acquired a 49% equity interest in Singapore-based MGR for US$49,900 (the "Investment"). Amedeo Asia has acquired the Investment from Fortus PTE Ltd, a company of which Mr Lau was a director. As part of the Investment, Amedeo has provided a three year unsecured 15% coupon convertible loan to MGR of up to US$1.95 million to assist MGR to increase its trading operations ("Convertible Loan"). The Convertible Loan can be converted at any time during the three year period at Amedeo's option into new shares in MGR at US$1 per new share. MGR also paid Amedeo Resources plc GBP80,000 for the provision of Management Services during the year. At the time the investment was made, Mr Lau was a director of Fortus. The independent directors of the Company gave careful consideration to the terms convertible loan and, after consulting with Daniel Stewart & Company Plc, the Company's nominated adviser, deemed the investment fair and reasonable insofar as the Company's shareholders were concerned. Mr Lau is no longer a director of Fortus.
YZJ JV paid Amedeo Resources plc GBP895 for the provision of Management Services during the year.
The non-executive Director services of A Berting were provided to the Company through Melotti, a Company of which Mr A Berting is the sole shareholder and director. During the year, fees of GBP10,000 were paid to Melotti (2013: GBP12,000) and there were no balances outstanding at the year end.
21. Analysis of cash and cash equivalents 2014 2013
GBP'000 GBP'000
Cash at bank and in hand 353 1,750
22. Financial instruments and risk management
Investments
All of the Group's actual and intended investments present a risk of loss of capital. Such investments are subject to investment specific, industry specific, sector specific, market specific and macro-economic risks including, but not limited to, international economic conditions, international financial policies and performance, governmental events and changes in laws. Moreover, the Company may only have a limited ability to vary its investments in response to changing conditions.
The success of the Company is dependent upon the identification, making, management and realisation of suitable investments. There can be no guarantee that such investments can or will be made or that such investments will be successful. Poor performance by an investment could severely affect the net asset value per share of the Company.
The Company may have minority interests in the companies, partnerships and ventures. As such it may be unable to exercise control over the operations of such investments or control over any exit, or timing of any exit, by other investors in such investments. In addition, the managements of the investee companies targeted by the Directors may not always welcome proactive shareholder involvement.
The Company may dispose of investments and in certain circumstances and may be required to give representations and warranties about those investments. In certain cases such representations and warranties may be challenged. This may lead to the Company having to pay damages to the extent that such representations and warranties turn out to be inaccurate or other terms of sale are breached.
There can be no certainty that the value of investments as reported from time to time will in fact be realised.
Investments in unquoted companies
It is intended that the Company's investment portfolio will comprise interests predominantly in unquoted, growth companies, which may be difficult to value and/or realise. Investments in unquoted growth companies may involve greater risks than is customarily associated with investments in larger, more established quoted companies. In particular, such companies may have limited product offerings, markets or resources and may be dependent on a small number of key individuals. As at 31 January 2014, the Group's holding of unquoted investments was valued at approximately GBP9.2 million (2013: GBP9.5 million).
Market risk
It is possible that certain investments will represent a significant proportion of the Company's total assets, such as Amedeo Asia's investment in YZJ JV. As a result, the impact on the Company's performance and the potential returns to investors will be adversely affected to a greater degree if any one of those investments were to perform badly than would be the case if the Company's portfolio of investments was more diversified. At 31 January 2014, the overall investment allocation was a portfolio of 4 investments, of which one was in a quoted company and three investments were in unquoted companies. As at 31 January 2014, the Company's investment in YZJ JV represented 99% of the value of the Company's investment portfolio and almost 85% of the Group's gross assets.
Interest rate risk
The majority of the Group's financial assets and liabilities are not interest bearing. As a result, the Group is not subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates. Any cash and cash equivalents are held in short notice accounts. The table below summarises the Group's exposure to interest rate risks.
As at 31 January 2014 Non-interest Variable Fixed
bearing interest interest Total
Assets GBP'000 GBP'000 GBP'000 GBP'000
Investments at fair value 9,165 - 20 9,185
Loan to MGR - - 1,181 1,181
Other receivables 31 - - 31
Cash and cash equivalents 353 - - 353
______ _______ ______ ______
Total financial
assets 9,549 - 1,201 10,750
______ _______ ______ ______
Liabilities
Trade and other payables 121 - - 121
______ _______ ______ ______
Total financial liabilities 121 - - 121
______ _______ ______ ______
As at 31 January 2013 Non-interest Variable Fixed
bearing interest interest Total
Assets GBP'000 GBP'000 GBP'000 GBP'000
Investments at fair value 9,521 - 20 9,541
Other receivables 4 - - 4
Cash and cash equivalents 1,750 - - 1,750
______ _______ ______ ______
Total financial
assets 11,275 - 20 11,295
______ _______ ______ ______
Liabilities
Trade and other payables 84 - - 84
______ _______ ______ ______
Total financial liabilities 84 - 84
______ _______ ______ ______
Hedging and currency risk
As the current focus of the Company's investment has been outside of the UK, the majority of the Company's investments are denominated in US$. As such, the Company is exposed to fluctuations in exchange rate variations between the US$ and GBP sterling. During the year under review, there were no hedging arrangements in place.
The YZJ and MGR investments are in US Dollar, and are valued using equity accounting. If the dollar were to appreciate by 5%, the effect would be a decrease in the value of the associates of GBP436,000. If the dollar were to depreciate by 5%, the effect would be an increase in the value of the associate of GBP482,000.
Liquidity risk
The Company's financial instruments include minority equity investments in unquoted Singapore-registered companies and an investment in an AIM-traded company As a result, the Company may not be able to quickly liquidate some of its investments in these instruments at an amount close to their fair value in order to meet its liquidity requirements.
The Company has a procedure to manage liquidity risk whereby the board meet regularly to review investment holdings and current and anticipated levels of financial liabilities. Where liquidity of the investments within the portfolio is believed to be at a level which may adversely affect the Company's ability to service its financial obligations, the board will consider taking action to improve cash flow, which may include utilising bank overdrafts or other credit arrangements.
The table below details the contractual, undiscounted cash flows of the Group's financial liabilities
Less than 1-3 3 months No stated
1 month months to 1 year maturity
31 January 2014 GBP'000 GBP'000 GBP'000 GBP'000
Trade and other payables 121 - - -
______ ______ ______ ______
Totall 121 - - -
______ ______ ______ ______
31 January 2013
Trade and other
payables 84 - - -
_______ ______ ______ ______
Total 84 - - -
_______ ______ ______ ______
Credit risk
Credit risk is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Group. The carrying amounts of financial assets best represent the maximum credit risk exposure at the balance sheet date.
Capital risk management
The Company is currently financed solely through equity and manages its capital to ensure that it has sufficient financial resources to implement its planned operations while maximising the return to stakeholders. Please see Strategic report on page 9 for details. Details of additional equity raised in the year are set out in note 15.
23. Post balance sheet events
Other than as set out below, the Directors consider that there are no events not disclosed in the Directors' report or elsewhere in this report that require disclosure as post balance sheet events.
On the 3 March 2014, the Company announced it had raised a total of approximately GBP5.2 million, through a subscription and a placing of 521,764,569 new ordinary shares of 0.1p each with institutional and other investors. Following this subscription and placing, the Company had outstanding 3,265,384,202 ordinary shares of 0.1p each.
GBP3.3m (US$5.1m) of the funds were utilised to fully pay up Amedeo's stake in YZJ JV.
GBP1.2m (US$1.98m) of the funds were utilised to make a loan to MGR. The loan provided by Amedeo to MGR post year end was a five year 15% coupon loan, made on the 19 June 2014.
As at the date of signature of these accounts the company had GBP1m (US$1.7m) of cash and equivalent balances.
24. Ultimate controlling party
The ultimate controlling party is Qatar Investment Corporation, which holds 61.1% of the issued Ordinary Share capital of the Group.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR FRMFTMBBTBII
1 Year Amedeo Res Chart |
1 Month Amedeo Res Chart |
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
