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ARG Argos Resources Limited

0.35
0.00 (0.00%)
Last Updated: 00:00:00
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Argos Resources Limited LSE:ARG London Ordinary Share FK0114538241 ORD 2P (DI)
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 0.35 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
0 0 N/A 0

Argos Resources Ltd 2017 Financial Results (9137H)

16/03/2018 7:00am

UK Regulatory


Argos Resources (LSE:ARG)
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TIDMARG

RNS Number : 9137H

Argos Resources Ltd

16 March 2018

16 March 2018

ARGOS RESOURCES LIMITED

("Argos" or "the Company")

2017 Financial Results

Highlights

Argos Resources Ltd (AIM: ARG.L), the Falkland Islands based exploration company focused on the North Falkland Basin, announces its financial results for the year ended 31 December 2017.

 
 *    US$118,000 profit 
 
 
   *    US$758,000 cash reserves at 31 December 2017 
 
   *    The Company retains an Overriding Royalty Interest 
        (the "ORRI") of 5% of all oil and gas produced over 
        the life of Licence PL001 in the North Falkland Basin 
        (the "Licence") from all hydrocarbon discoveries 
        developed within the Licence area 
 
   *    All future expenditures incurred on the Licence will 
        be at no cost to the Company 
 
   *    The Company will receive future cash payments of 
        $405,000 per annum from Noble Energy Falklands 
        Limited ("Noble") and Edison International S.p.A 
        ("Edison") which will be sufficient to meet its 
        ongoing running costs until first oil production 
 
 
   *    A three year extension of the Licence was approved in 
        2016 which extends the current Second Phase of the 
        Licence to November 2019 
 

The full Annual Report and Consolidated Financial Statements can be read and downloaded from the Company website: http://www.argosresources.com/news.php?page=regulatory-news

Argos Resources Limited (+500 22685)

www.argosresources.com

Ian Thomson, Chairman

John Hogan, Managing Director

Cenkos Securities plc (Nomad & Broker)

Derrick Lee (+44 131 220 9100)

Neil McDonald (+44 131 220 6939)

Combined Chairman's statement and Managing Director's review

Oil prices rose steadily during the second half of 2017, supported by sustained production curtailments from a number of leading OPEC and non-OPEC producers. The Brent oil price at year end 2017 approached $67 per barrel, an increase of over $10 per barrel from the beginning of the year. The industry response to this has so far been muted, with concerns about the sustainability of these price levels continuing for the long term.

A Participation Agreement between Noble, Edison and the Company continues to be in effect. The Participation Agreement confirms the Company's entitlement to a 5 percent Overriding Royalty Interest in Licence PL001 in the North Falkland Basin. This royalty interest entitles the Company to 5 percent of all oil and gas produced over the life of the Licence, free and clear of all costs. Also, under the terms of the Participation Agreement, the Company has been receiving quarterly cash payments totalling GBP300,000 per annum during 2017, which is sufficient to meet its ongoing running costs.

The Company announced in August 2016 that a three-year extension to the Licence had been approved by the Executive Council of the Falkland Islands Government and by the UK Secretary of State for Foreign and Commonwealth Affairs. This approval extends the current Second Phase of the Licence to November 2019, after which a Third Licence Phase of 10 years is available to the Licensees.

With world-wide exploration drilling activities still suppressed, the Company cannot yet forecast when drilling operations might commence on the Licence. However, the Overriding Royalty Interest in the Licence continues through the Second Phase of the Licence and any further phases beyond, and the Company's future running costs are covered, so we remain well positioned. The Company continues to be positive about the exploration potential of the Licence Area.

Results and dividend

The results for the year and the Group's financial position as at the year-end are shown in the attached financial statements. The directors have not recommended a dividend for the year (2016: $nil).

Business review

The Group has returned a profit for the year ended 31 December 2017 of $118,000 (2016: loss of $16,000) which equates to a profit per share of 0.05 cents (2016: loss per share of 0.007 cents). The profit reflects the full effects of management efforts to cut costs in 2016, positive foreign exchange differences and the receipt of income under the Participation Agreement.

Administration expenses were $329,000 in 2017 compared to $427,000 in 2016.

Shareholders' equity has increased marginally from $29.32 million to $29.46 million in the year since 31 December 2016, as receipts under the Participation Agreement offset the administration costs, leaving a small surplus. Cash in the year increased from $701,000 to $758,000.

Outlook for the next financial year

The Participation Agreement with Noble and Edison means that the Group will continue to receive quarterly cash payments totalling GBP300,000 per annum, in Sterling, which equates to $405,000 at the year-end exchange rate and covers the Group's ongoing costs. There is a risk that Noble and Edison withdraw from the agreement. In such circumstances the Licence would revert back to Argos, subject to Government approval. Given that Noble and Edison have been granted an extension to the Licence, which now runs until November 2019, withdrawal is considered unlikely. The Group is therefore fully funded for the foreseeable future.

Ian Thomson John Hogan

Chairman Managing Director

Consolidated statement of comprehensive income

Year ended 31 December 2017

 
                                                          Year            Year 
                                                         ended           ended 
                                                   31 December     31 December 
                                                          2017            2016 
                                                         $'000           $'000 
 Other income                                              380             505 
 Administrative expenses                                 (329)           (427) 
 
 Finance income                                              1               1 
 Foreign exchange gains/(losses)                            66            (95) 
----------------------------------------------  --------------  -------------- 
 
 Profit/(loss) for the 
  year attributable to 
  owners of the parent                                     118            (16) 
----------------------------------------------  --------------  -------------- 
 
 Total comprehensive 
  income for the period 
 attributable to owners 
  of the parent                                            118            (16) 
 Basic and diluted earnings/(loss) 
  per share (cents)                                       0.05         (0.007) 
----------------------------------------------  --------------  -------------- 
 

Consolidated statement of financial position

As at 31 December 2017

 
                                   2017      2016 
                                  $'000     $'000 
 Assets 
 Non-current assets 
 Royalty interests               28,749    28,749 
                                 28,749    28,749 
 Current assets 
 Other receivables                   14        15 
 Cash and cash equivalents          758       701 
-----------------------------  --------  -------- 
 
 Total current assets               772       716 
-----------------------------  --------  -------- 
 
 Total assets                    29,521    29,465 
 
 Liabilities 
 Current liabilities 
 Trade and other payables            59       148 
 
 Total liabilities                   59       148 
 
 Total net assets                29,462    29,317 
-----------------------------  --------  -------- 
 
 
 Capital and reserves 
  attributable to 
 equity holders of the 
  Company 
 Share capital                    6,696     6,669 
 Share premium                   30,071    30,071 
 Retained losses                (7,305)   (7,423) 
 
 Total shareholders' 
  equity                         29,462    29,317 
-----------------------------  --------  -------- 
 

Consolidated statement of cash flows

Year ended 31 December 2017

 
                                                  Year            Year 
                                                 ended           ended 
                                           31 December     31 December 
                                                  2017            2016 
                                                 $'000           $'000 
 Cash flows from operating 
  activities 
 Profit/(loss) for period 
  before taxation                                  118            (16) 
 Adjustments for: 
 Finance income                                    (1)             (1) 
 Foreign exchange                                 (67)              92 
 Depreciation                                        -               3 
 
 Net cash inflow from operating 
  activities 
 before changes in working 
  capital                                           50              78 
--------------------------------------  --------------  -------------- 
 
 Decrease in other receivables                       1              37 
 (Decrease)/increase in 
  other payables                                  (89)              54 
--------------------------------------  --------------  -------------- 
 
 Net cash (outflow)/inflow 
  from operating activities                       (38)             169 
--------------------------------------  --------------  -------------- 
 
 Investing activities 
 Interest received                                   1               1 
 Proceeds on the sale of 
  assets                                             -             172 
 
 Net cash received from 
  investment activities                              1             173 
--------------------------------------  --------------  -------------- 
 
 Financing activities 
 Issue of ordinary shares 
  (share options exercised)                         27               - 
 
 Net cash from financing 
  activities                                         -               - 
--------------------------------  ----  --------------  -------------- 
 
 Net (decrease)/ increase 
  in cash and cash equivalents                    (10)             342 
 Cash and cash equivalents 
  at beginning of period                           701             451 
 Exchange gains/(losses) 
  on cash and cash equivalents                      67            (92) 
--------------------------------------  --------------  -------------- 
 
 Cash and cash equivalents 
  at end of the year                               758             701 
--------------------------------------  --------------  -------------- 
 

Consolidated statement of changes in equity

Year ended 31 December 2017

 
 
                             Share      Share   Retained     Total 
                           capital    premium     losses    equity 
                             $'000      $'000      $'000     $'000 
 At 1 January 2016           6,669     30,071    (7,407)    29,333 
 Total comprehensive 
  income for the 
  year                           -          -       (16)      (16) 
 
 At 31 December 
  2016 
  And 1 January 2017         6,669     30,071    (7,423)    29,317 
-----------------------  ---------  ---------  ---------  -------- 
 
 Total comprehensive 
  income for the 
  year                           -          -        118       118 
 Shares issued (share 
  options exercised)            27          -          -        27 
 
 At 31 December 
  2017                       6,696     30,071    (7,305)    29,462 
-----------------------  ---------  ---------  ---------  -------- 
 

In preparing the financial information in this statement the Group, which consists of the Company Argos Resources Ltd, and its wholly owned subsidiary Argos Exploration Ltd, has applied policies in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS"). The financial information has been prepared under the historical cost convention.

The financial information set out above does not constitute the company's statutory accounts for 2016 or 2017. Statutory accounts for 2016 and 2017 have been reported on by the Independent Auditors. The Independent Auditors' Reports on the Annual Report and Financial Statements for 2016 and 2017 were unqualified and did not draw attention to any matters by way of emphasis.

This information is provided by RNS

The company news service from the London Stock Exchange

END

FR UVOKRWSAOAAR

(END) Dow Jones Newswires

March 16, 2018 03:00 ET (07:00 GMT)

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