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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Gtl Resources | LSE:GTL | London | Ordinary Share | GB00B1HT2334 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 99.00 | 0.00 | 00:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Dec 2019 to Dec 2024
TIDMGTL
RNS Number : 9107R
GTL Resources PLC
11 November 2011
For Immediate Release 11 November 2011
GTL Resources PLC
("GTL" or the "Group")
Unaudited Interim Results
GTL Resources PLC (AIM: GTL), the US based bio-refining company, today announced interim results for the six months ended 30 September 2011 (First Half FY2012).
Highlights for the period:
-- Pre-tax profit of $5.4 million (First Half FY2011: $6.2 million, which included $1.7 million of exceptional business interruption proceeds). Excluding the FY2011 exceptional item, pre-tax profit increased $0.9 million, or 19.2%.
-- EBITDA of $14.1 million (First Half FY2011: $15.6 million, which included $1.7 million of exceptional business interruption proceeds)
-- Net debt decreased $8.2 million from year end 31 March 2011 and $17.1 million from 30 September 2010
-- Revenue increased 65.6% to $180.8 million (First Half FY2011: $109.2 million) -- Commodity margins improved 5.4% to $0.59/gallon (First Half FY2011: $0.56/gallon) -- Ethanol production of 55.0 million gallons (First Half FY2011: 55.2 million gallons)
Commenting on the results, CEO Richard Ruebe said: "We are delighted with GTL's performance for the period. Operationally, the GTL plant ran at a 110 million gallon annualized rate for the period, despite taking an extended maintenance shut down in May 2011 to install our new corn milling building, steel corn bin, and corn conveyance system. Our operations team is constantly reviewing the way we operate to identify improvements and de-bottleneck constraints for increased production. Other improvements made during the extended May 2011 plant shutdown allowed the plant to run at higher production rates this past summer than in previous summers. Production from July to September 2011 indicates the plant can now produce at a 115 million gallons per annum rate when commodity margins warrant maximum production. For the six month period, commodity margins improved nearly 6% over the same period last year resulting in net debt reduction of $8.2 million."
For further information please contact:
GTL Resources
Richard Ruebe, CEO +1 630-773-1226
Cenkos
Stephen Keys +44 2073 978928
Elizabeth Bowman
Buchanan Communications
Charles Ryland +44 2074 665000
Ben Romney
CEO Statement
Interim Results
GTL's strong operational and commercial performance enabled the Group to achieve improved earnings (excluding the FY2011 exceptional item) for the six months ending 30 September 2011. GTL continued to improve elements of the business under its control. Recent production rates have increased and yields have improved. Year over year, ethanol and DDGS prices have significantly increased. In July 2011, ethanol reached a five year high selling price of $3.17 per gallon but corn costs also significantly increased during the period. Corn costs reached a record high of $7.87/bushel on the Chicago Board of Trade for prompt pricing in June 2011. The effect of these key component changes resulted in a net increase of $0.03 per gallon in the GTL commodity margin (Ethanol + DDGS - Corn costs - Natural Gas costs) over the same period last year.
Key Performance Indicators (unaudited)
Hot Features
Premium
Six Months Six Months
to 30 September to 30 September
2011 2010 Change
----------------------------------- ----------------- ----------------- --------
Production (mil. denatured gals.) 55.0 55.2 -0.2
Ethanol yield (den. gals./bushel) 2.84 2.80 +0.04
Ethanol net price ($/gal) $2.67 $1.63 +$1.04
DDGS net price ($/ton) $206 $121 +$85
Corn net price ($/bushel) $7.09 $3.53 +$3.56
Natural Gas net price ($/MMBtu) $4.74 $4.91 -$0.17
Commodity margin ($/gal) $0.59 $0.56 +$0.03
Results Summary (unaudited)
Six Months Six Months
to 30 September to 30 September
2011 2010 Change
---------------------------- ----------------- ----------------- -------
Ethanol sales (million
gallons) 55.6 54.8 +0.8
$M $M $M
Revenue 180.8 109.2 +71.6
EBITDA 14.1 15.6 -1.5
Pre-tax profit 5.4 6.2 -0.8
Earnings per share (basic) $0.08 $0.12 -$0.04
Revenue of $180.8 million for the period was $71.6 million higher than the same period last year (First Half FY2011: $109.2 million). Ethanol sales of 55.6 million gallons were made at an average net price (after freight and commission) of $2.67 per gallon. Ethanol revenue of $149.5 million increased $58.8 million over the same period last year of $90.7 million, due to higher volume of $1.4 million and higher sales prices of $57.4 million. DDGS sales of 149.9 thousand tons realized an average net price of $206 per ton (First Half FY2011: $121 per ton). DDGS gross revenues of $31.3 million were $12.8 million more than the same period last year, mainly due to higher sales prices.
Cost of sales for the period increased $71.0 million to $162.1 million (First Half FY2011: $ 91.1 million). The increase was primarily related to higher corn costs per bushel with a relatively much smaller offset from the improved yield per bushel of corn.
Administrative expenses for the period were $10.6 million, $0.6 million higher than the prior year amount of $10.0 million. Administrative expenses include depreciation, plant administrative expenses, and corporate overhead costs. The increase in administrative expenses was primarily due to higher legal fees relating to litigation brought by the Group (described in Note 7) and depreciation expense.
Finance expenses for the period of $3.1 million were down from last year's expenses by $1.2 million (First Half FY2011: $4.3 million) as a result of reduced debt levels and the expiration of the interest rate swaps on 30 June 2011.
For the six months ended 30 September 2011, the Group reported profit before tax of $5.4 million versus prior year's $6.2 million. The decrease of $0.8 million was due to one-time business interruption insurance proceeds of $1.7 million that were received during the six months ended 30 September 2010. Profit before tax for the six months ended 30 September 2011, excluding business interruption proceeds in FY2011, was an increase of $0.9 million from the prior year.
Income tax expense was $2.1 million for the period versus $1.6 million in the prior year. The increase relates to the reversal of a $1 million valuation allowance relating to Net Operating Loss (NOL) utilisation in the US during the six months ended 30 September 2010. GTL records income tax expense at the statutory tax rates on book income. However, based on accelerated depreciation for tax purposes, it is expected that GTL will not be in a federal income tax paying position for several years. At the state level, Illinois has suspended NOL utilisation for three years to address its deficit which may cause GTL to make state income tax payments starting in fiscal 2013. GTL expects the effective tax rate for book purposes to be in the 41% range for FY2012 and subsequent years.
GTL's profit for the period attributable to the equity holders of the Group was $2.5 million (First Half FY2011: $3.8 million), and represented a profit of $0.08 per basic share (First Half FY2011: $0.12 per basic share).
Inventory Levels
Inventories were $11.3 million at 30 September 2011, an increase of $2.5 million from 30 September 2010 due to higher corn costs per bushel. Volume levels for corn at 30 September 2011 were flat when compared to 30 September 2010.
Net Debt
The Group's objectives when managing debt are to safeguard the Group's ability to continue as a going concern so that it can continue to provide benefits and value for shareholders and other stakeholders. One of the subsidiaries of the Company, Illinois River Energy (IRE), holds restricted use, debt service and contingency bank deposits. The restricted use bank deposits are current cash funds drawn down under the terms of the senior debt agreement that are to be applied to specific trade creditor balances. The debt service bank deposits must be maintained under loan covenants to guarantee the capability of IRE to make minimum interest and loan repayments. IRE maintains debt service bank deposits along with restricted cash deposits that effectively reduce total debt.
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
Loans and borrowings
----------------------------------- ---------------------- ------------------- ------------
Non-current liabilities 94,750 114,752 103,752
Current liabilities 7,141 7,038 7,039
----------------------------------- ---------------------- ------------------- ------------
Total loans and borrowings 101,891 121,790 110,791
Less: Other financial assets
- Non-
current 10,426 17,488 10,384
Other financial assets
- Current 9,945 4,242 10,136
Cash and cash equivalents 6,379 7,768 6,895
----------------------------------- ---------------------- ------------------- ------------
Net debt 75,141 92,292 83,376
=================================== ====================== =================== ============
Current Trading and Prospects
The IRE plant is performing well and continues to produce above nameplate capacity. Market margins have been favourable for ethanol producers in the weeks since the period ended. Although, as highlighted in our recent AGM Trading Statement in September, with certain regulatory and legislative issues pending, we appreciate that long term visibility on commodity margins is hard to predict. GTL's commodity margins are largely driven by the volatile commodity prices of ethanol, corn and natural gas resulting in forecast visibility that is very short term. Management expects to see some increased temporary volatility due to the anticipated 31 December 2011 expiration of the ethanol blender's credit (the result of which may be a pre-year end increase in commodity margins, and subsequent post-year end decline). Overall, we expect that the 13.2 billion corn based ethanol gallons mandated by RFS2, the steadily growing amount of US ethanol exports, and the gradual introduction of 15 per cent ethanol blends for newer model cars in the US together should all have a positive impact on industry demand.
Subsequent Event
On 31 October 2011, a press release was issued announcing a GTL Board recommended offer by Sinav Limited ("Sinav" or the "Offeror") to acquire all the shares of GTL. Prior to the announcement, Sinav and its affiliates owned 22.66% of GTL. Highlights of the offer are as follows:
-- Sinav will pay 100 pence in cash for all of the outstanding shares it does not currently own, representing a 34% premium over the 74.50 pence closing price on October 28(th) , the last day of trading prior to the offer announcement. Current GTL shareholders, under certain circumstances, may elect to "roll over" their shares to retain an ownership interest in GTL.
-- The Offeror's intent is to delist GTL from the AIM exchange in London and run the business as a private company
-- After the transaction is completed, GTL will have a new Board of Directors and no public company expenses
-- The Offeror has indicated its intent to retain all GTL and IRE employees to pursue GTL management's medium term strategy of increasing production volumes and pursuing alternative revenue streams. There are no plans to change the principal locations of the business.
-- The transaction is expected to close in approximately two to three months
10 November 2011
Richard Ruebe
Company CEO
GTL Resources PLC
Condensed consolidated statement of comprehensive income
for the 6 months ended 30 September 2011
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
---------------------------------- -------------------------- ---------------------- ------------------------
Revenue 180,827 109,159 261,447
Cost of sales (162,059) (91,121) (223,397)
---------------------------------- -------------------------- ---------------------- ------------------------
Gross profit 18,768 18,038 38,050
Administrative expenses -
exceptional - 1,679 1,679
Administrative expenses (10,641) (10,035) (21,492)
---------------------------------- -------------------------- ---------------------- ------------------------
Results from operating activities 8,127 9,682 18,237
Finance income 403 807 1,589
Finance expenses (3,112) (4,263) (7,842)
---------------------------------- -------------------------- ---------------------- ------------------------
Profit before tax 5,418 6,226 11,984
Income tax expense (2,113) (1,591) (4,100)
---------------------------------- -------------------------- ---------------------- ------------------------
Profit and total comprehensive
income
for the period 3,305 4,635 7,884
================================== ========================== ====================== ========================
Profit and comprehensive income
attributable
to:
Equity holders of the company 2,530 3,750 6,175
Non-controlling interest 775 885 1,709
---------------------------------- -------------------------- ---------------------- ------------------------
Profit and comprehensive income
for
the period 3,305 4,635 7,884
---------------------------------- -------------------------- ---------------------- ------------------------
Earnings per share
Basic earnings per ordinary share $0.08 $0.12 $0.19
---------------------------------- -------------------------- ---------------------- ------------------------
Diluted earnings per ordinary
share $0.08 $0.12 $0.19
---------------------------------- -------------------------- ---------------------- ------------------------
Condensed consolidated statement of financial position
at 30 September 2011
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
------------------------------------- ------------------ ------------------ ---------------
Assets
------------------------------------- ------------------ ------------------ ---------------
Property, plant and equipment 153,472 158,707 156,872
Intangible assets - goodwill 7,390 7,390 7,390
Investments 445 100 510
Other financial assets 10,426 17,488 10,384
Total non current assets 171,733 183,685 175,156
------------------------------------- ------------------ ------------------ ---------------
Inventories 11,295 8,799 10,744
Trade and other receivables 3,300 4,301 3,931
Other current assets 827 1,452 1,272
Other financial assets 9,945 4,242 10,136
Cash and cash equivalents 6,379 7,768 6,895
Total current assets 31,746 26,562 32,978
------------------------------------- ------------------ ------------------ ---------------
Total assets 203,479 210,247 208,134
------------------------------------- ------------------ ------------------ ---------------
Equity
Share capital 60,205 60,205 60,205
Share premium 317 317 317
Retained earnings 12,245 7,129 9,623
------------------------------------- ------------------ ------------------ ---------------
Total equity attributable to equity
holders of the Company 72,767 67,651 70,145
Non-controlling interest 10,143 8,544 9,368
------------------ ------------------ ---------------
Total equity 82,910 76,195 79,513
------------------------------------- ------------------ ------------------ ---------------
Liabilities
Loans and borrowings 94,252 114,752 103,752
Finance lease obligation 498 - -
Deferred revenue 4,560 3,659 3,846
Deferred income tax liabilities 6,214 1,591 4,100
------------------------------------- ------------------ ------------------ ---------------
Total non current liabilities 105,524 120,002 111,698
------------------------------------- ------------------ ------------------ ---------------
Trade and other payables 7,108 5,786 9,418
Finance lease obligation 102 - -
Other financial liabilities at fair
value through the profit and loss - 1,095 332
Loans and borrowings 7,039 7,038 7,039
Deferred revenue 796 131 134
Total current liabilities 15,045 14,050 16,923
------------------------------------- ------------------ ------------------ ---------------
Total liabilities 120,569 134,052 128,621
------------------------------------- ------------------ ------------------ ---------------
Total equity and liabilities 203,479 210,247 208,134
------------------------------------- ------------------ ------------------ ---------------
These financial statements were approved by the Board of Directors on 10 November 2011 and were signed on its behalf by:
Richard Ruebe
Company CEO
GTL Resources PLC
Condensed consolidated statement of cash flows
for the 6 months ended 30 September
2011
6 months 6 months
ended ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
------------------------------------------- ------------------- ---------------- --------------
Cash flows from operating activities
Profit for the period 3,305 4,635 7,884
Adjustments for:
Depreciation and amortization 6,107 5,774 11,921
Deferred revenue 548 (68) (134)
Loss on disposal of assets - 152 319
Net finance expense 2,709 3,314 6,253
Share based payment transactions 92 37 106
Income tax expense 2,113 1,591 4,100
------------------------------------------- ------------------- ---------------- --------------
14,874 15,435 30,449
Change in inventories (551) (3,390) (5,335)
Change in trade and other receivables 631 (870) (500)
Change in other current assets 445 38 212
Change in trade and other payables (2,310) (1,228) 2,438
------------------------------------------- ------------------- ---------------- --------------
13,089 9,985 27,264
Interest paid (3,112) (4,144) (7,876)
------------------- ---------------- --------------
Net cash from operating activities 9,977 5,841 19,388
------------------------------------------- ------------------- ---------------- --------------
Cash flows from investing activities
Interest received 71 11 31
Acquisition of property, plant and
equipment (2,707) (224) (4,924)
Investments 65 (100) (510)
Other financial asset deposits 149 2,424 3,835
------------------------------------------- ------------------- ---------------- --------------
Net cash from investing activities (2,422) 2,111 (1,568)
------------------------------------------- ------------------- ---------------- --------------
Cash flows from financing activities
Proceeds from grant award 828 200 459
Capital lease obligation 601 - -
Repayment of borrowings (9,500) (9,000) (20,000)
Net cash from financing activities (8,071) (8,800) (19,541)
------------------------------------------- ------------------- ---------------- --------------
Net decrease in cash and cash equivalents (516) (848) (1,721)
Cash and cash equivalents at beginning
of the year 6,895 8,616 8,616
------------------------------------------- ------------------- ---------------- --------------
Cash and cash equivalents at end
of the year 6,379 7,768 6,895
------------------------------------------- ------------------- ---------------- --------------
Condensed consolidated statement of changes in equity
for the 6 months ended 30 September 2011
Share Share Retained Minority Total
capital premium earnings Total interest equity
--------------- ---------------- -------------- ------------- --------------- -------------
$000 $000 $000 $000 $000 $000
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 1 April 2010 60,205 317 3,342 63,864 7,659 71,523
Profit for the
period - - 3,750 3,750 885 4,635
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
Total comprehensive
income
for the period 3,750 3,750 885 4,635
Share based payment
transactions - - 37 37 - 37
At 30 September
2010 60,205 317 7,129 67,651 8,544 76,195
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 1 April 2010 60,205 317 3,342 63,864 7,659 71,523
Profit for the
period - - 6,175 6,175 1,709 7,884
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
Total comprehensive
income
for the period 6,175 6,175 1,709 7,884
Share based payment
transactions - - 106 106 - 106
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 31 March 2011 60,205 317 9,623 70,145 9,368 79,513
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
At 1 April 2011 60,205 317 9,623 70,145 9,368 79,513
Profit for the
period - - 2,530 2,530 775 3,305
Total comprehensive
income
for the period 2,530 2,530 775 3,305
Share based payment
transactions - - 92 92 - 92
--------------------
At 30 September
2011 60,205 317 12,245 72,767 10,143 82,910
-------------------- --------------- ---------------- -------------- ------------- --------------- -------------
Notes to Interim Statement
for the six months ended 30 September 2011
1 Basis of preparation
The interim condensed financial statements are unaudited and do not constitute statutory financial statements within the meaning of section 435 of the Companies Act 2006.
The comparative figures for the year ended 31 March 2011 were derived from the statutory accounts for that year which have been delivered to the Registrar of Companies. Those accounts received an unqualified audit report which did not contain statements under section 498(2) or (3) (accounting records or returns inadequate, accounts not agreeing with records and returns or failure to obtain necessary information and explanations) of the Companies Act 2006.
The interim condensed financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the European Union and the AIM rules of the London Stock Exchange. This report should be read in conjunction with the Group's Annual Report and Accounts 2011, which have been prepared in accordance with IFRSs as adopted by the European Union.
2 Accounting Policies
The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those presented in the Group's Annual Report and Accounts for the year ended 31 March 2011.
The preparation of interim financial statements requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. There have been no significant changes in the bases upon which estimates have been determined compared to those applied at 31 March 2011, and no change in estimate has had a material effect on the current period. All significant estimates and judgments have been disclosed in the Group's Annual Report and Accounts for the year ended 31 March 2011. Actual results may differ from these estimates.
These condensed consolidated interim financial statements have been prepared on the basis of IFRSs in issue that are effective at the Company's annual reporting date as at 31 March 2012.
3 Operating segments
Managements approach to reporting the financial performance and position of its business is as follows.
The Directors believe that the revenues achieved through the sale of DDGS does not constitute an operating segment as defined by applicable accounting standards. DDGS is a by-product from the production process of ethanol and revenues are monitored accordingly. There is no further financial information available or presented to the Group's chief operating decision maker.
Seasonality of operations - There is no significant seasonal nature to the Group's business of the production of ethanol.
6 months 6 months 6 months 6 months 6 months 6 months 12 months 12 months 12 months
ended ended ended ended ended ended ended ended ended
30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 Sept. 31 Mar. 31 Mar. 31 Mar.
2011 2011 2011 2010 2010 2010 2011 2011 2011
Head Head Head
IRE Office Total IRE Office Total IRE office Total
$000 $000 $000 $000 $000 $000 $000 $000 $000
Gross Revenues 180,827 - 180,827 109,159 - 109,159 261,447 - 261,447
--------- --------- --------- --------- --------- --------- ---------- ---------- ----------
Profit Before
Tax 6,017 (599) 5,418 6,876 (650) 6,226 13,234 (1,250) 11,984
--------- --------- --------- --------- --------- --------- ---------- ---------- ----------
Total Assets 195,410 8,069 203,479 202,354 7,893 210,247 200,314 7,820 208,134
--------- --------- --------- --------- --------- --------- ---------- ---------- ----------
4 Earnings per ordinary share
Basic earnings per share
The calculation of basic earnings per share at 30 September 2011 was based on the profit for the period and on the weighted average number of ordinary shares in issue during the period.
6 months
6 months ended ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
------------------------------------- --------------------- ------------------------- -----------------------
Profit attributable to ordinary
shareholders 2,530 3,750 6,175
------------------------------------- --------------------- ------------------------- -----------------------
Weighted average number of ordinary
shares
------------------------------------- --------------------- ------------------------- -----------------------
Issued ordinary shares at 1 April 31,989 31,989 31,989
Weighted average number of ordinary
shares at 30 September or 31 March 31,989 31,989 31,989
------------------------------------- --------------------- ------------------------- -----------------------
Earnings per share $0.08 $0.12 $0.19
------------------------------------- --------------------- ------------------------- -----------------------
Diluted earnings per share
The calculation of diluted earnings per share at 30 September 2011 was based on the profit for the period and on the weighted average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares.
6 months ended 6 months ended Year ended
30 September 30 September 31 March
2011 2010 2011
(Unaudited) (Unaudited) (Audited)
$000 $000 $000
--------------------- --------------------- ------------
Profit attributable to ordinary
shareholders (diluted) 2,530 3,750 6,175
------------------------------------- --------------------- --------------------- ------------
Weighted average number of ordinary
shares (basic) 1 April 31,989 31,989 31,989
Effect of share options on issue 486 429 433
---------------------
Weighted average number of ordinary
shares (diluted) at 30 September
or 31 March 32,475 32,418 32,422
------------------------------------- --------------------- --------------------- ------------
Diluted earnings per share $0.08 $0.12 $0.19
------------------------------------- --------------------- --------------------- ------------
5 Directors' emoluments
Salaries and Defined pension
Fees Taxable Benefits plan contribution Bonus Total emoluments
----------------------------- -------------------------- ---------------------------- -------------------------- ----------------------------
6 6 12 6 6 12 6 6 12 6 6 12 6 6 12
months months months months months months months months months months months months months months months
ended ended ended ended ended ended ended ended ended ended ended ended ended ended ended
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
Sept Sept March Sept Sept March Sept Sept March Sept Sept March Sept Sept March
2011 2010 2011 2011 2010 2011 2011 2010 2011 2011 2010 2011 2011 2010 2011
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
Executive
directors 163 150 325 7 6 13 6 5 10 100 70 140 276 231 488
Non -
Executive
directors 99 99 191 - - - - - - - - - 99 99 191
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
Aggregate
emoluments 262 249 516 7 6 13 6 5 10 100 70 140 375 330 679
-------- -------- --------- ------- ------- -------- -------- -------- -------- -------- ------- ------- -------- -------- --------
The Directors of the company are deemed to be key management personnel under applicable accounting standards.
6 Half year financial report
The condensed financial statements were approved by the Board of Directors on 15 November 2011 and are available on the Company's website, www.gtlresources.com. Copies are available on application to the Company Secretary, GTL Resources PLC 107 Cheapside, London, EC2V 6DN, UK
7 Contingencies
The lawsuit IRE brought against certain defendants in April 2009, including Fagen Inc. and IRE's previous insurance provider, continues to progress through the Illinois State court system. In early 2009, temporary repairs were made to the damaged concrete silo structure at IRE to ensure continued safe corn storage and milling. Nevertheless, since experts retained by IRE advised that the structural integrity of the silo structure was permanently compromised, there has been ongoing evidence of continued deterioration, and given that the litigation's slow pace was increasing the risk that the temporary repairs may fail, IRE management determined that it would be prudent to advance the construction of a replacement corn storage and milling system. The new storage and milling facilities, which include a standalone corn milling building and a 330,000 bushel corn storage bin, mitigate the risk of failure and downtime by providing corn processing capability that can function independently from the damaged structure. The project was completed and operational as of May 2011. The project cost of $5.4 million was funded by IRE's existing restricted cash reserves, set aside specifically for this important risk mitigation. Management believes, however, that property damage alone is substantially higher than the cost of this partial solution. Complete recovery of all damages from the defendants in the litigation is being pursued.
8 Principal risks and uncertainties
The Directors consider that the principal risks and uncertainties which could have a material impact on the Group's performance in the remaining six months of the financial year are the same as the principal risks and uncertainties stated in detail on pages 6 to 7 and 33 to 35 of our Annual Report and Accounts for the year ended 31 March 2011 and available on our website, www.gtlresources.com. In summary, the principal risks and uncertainties include:
-- Volatility in market commodity margins -- Credit Risk -- Liquidity Risk -- Market Risk -- Interest Rate Risk -- Capital Management Risk 9 Subsequent Event
On 31 October 2011, a press release was issued announcing a GTL Board recommended offer by Sinav Limited ("Sinav" or the "Offeror") to acquire all the shares of GTL. Prior to the announcement, Sinav and its affiliates owned 22.66% of GTL. Highlights of the offer are as follows:
-- Sinav will pay 100 pence in cash for all of the outstanding shares it does not currently own, representing a 34% premium over the 74.50 pence closing price on October 28(th) , the last day of trading prior to the offer announcement. Current GTL shareholders, under certain circumstances, may elect to "roll over" their shares to retain an ownership interest in GTL.
-- The Offeror's intent is to delist GTL from the AIM exchange in London and run the business as a private company
-- After the transaction is completed, GTL will have a new Board of Directors and no public company expenses
-- The Offeror has indicated its intent to retain all GTL and IRE employees to pursue GTL management's medium term strategy of increasing production volumes and pursuing alternative revenue streams. There are no plans to change the principal locations of the business.
-- The transaction is expected to close in approximately two to three months
Director's responsibility statement
The Directors confirm that, to the best of their knowledge:
-- The interim set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting', as adopted by the EU; and
-- The interim management report includes a fair view of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the interim set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.
The Directors of GTL Resources PLC are listed on pages 10 and 11 of the Group's Annual Report for the year ended 31 March 2011.
By order of the Board
Richard Ruebe
Company CEO
INDEPENDENT REVIEW REPORT TO GTL RESOURCES PLC
We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2011 which comprises the condensed consolidated statement of comprehensive income, the condensed consolidated statement of financial position, the condensed consolidated statement of cash flows, the condensed consolidated statement of changes in equity and the related notes. 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 condensed set of financial statements.
This report is made solely to the company in accordance with the terms of our engagement which includes assisting the company in meeting the requirements of the Disclosure and Transparency Rules ("the DTR") of the UK's Financial Services Authority ("the UK FSA"). Our review has been undertaken so that we might state to the company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusions we have reached.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules of the London Stock Exchange.
As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting," as adopted by the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.
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 Auditing Practices Board 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 Ireland) 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 condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2011 is not prepared, in all material respects, in accordance with the AIM Rules of the London Stock Exchange, International Accounting Standard 34 as adopted by the European Union and the DTR of UK FSA.
PKF (UK) LLP
Nottingham, UK
10 November 2011
This information is provided by RNS
The company news service from the London Stock Exchange
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