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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Providence Resources Plc | LSE:PVR | London | Ordinary Share | IE00B66B5T26 | ORD EUR0.001 (CDI) |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.25 | 3.10 | 3.40 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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Providence Resources P.l.c.
2020 Half Year Results
Dublin and London -- September 30th, 2020 - Providence Resources P.l.c.
(PVR LN, PRP ID), the Irish based Energy Company, today announces its
unaudited interim results for the half year ended June 30, 2020.
Highlights of the year to date;
-- Change of company leadership with appointment of Alan Linn as CEO in
early January 2020
-- Substantial reduction in corporate operating cost base achieved (63%
reduction year on year)
-- Company financial position stabilised through a successful share placing
and subscription in April 2020
-- Portfolio rationalised to establish clear focus on Barryroe development
and adjacent Celtic Sea opportunities
-- Barryroe farmout process refreshed, resulting in SpotOn Energy being
granted exclusivity through to 31st October this year
-- Consortium of global service industry leaders brought together to deliver
the Barryroe project on a shared risk basis as part of proposed farmout
-- Reversion of Barryroe interest, previously conditionally granted to APEC,
nearing completion
-- Relinquishment of all West of Ireland exploration licences underway
-- Angus McCoss stepped down from the board following the AGM and was
replaced by Andrew Mackay
Alan Linn, Chief Executive Officer commented:
"On joining Providence Resources in January 2020, I was tasked by the
board with updating the company strategy and expediting implementation.
Providence Resources is now focused upon progressing the development of
the Barryroe oil and gas field in the North Celtic Sea, offshore County
Cork. Barryroe is one of the largest undeveloped offshore oil and gas
fields in Europe and is unquestionably the core asset in our portfolio.
Good progress has been made to date, supported by a capital raising of
$3.3million, before expenses, which provided working capital in April to
fund the Barryroe farmout process and move the project into production
through phased economic development.
In May 2020, there was a further GBP200,000 raised through a
subscription agreement with SpotOn Energy Limited bringing their total
investment in Providence Resources Plc to GBP500,000.
The Barryroe field was recognized as a valuable national resource in
2012, when Providence drilled the 48/24-10Z appraisal well and confirmed
the presence of high-quality hydrocarbons, which tested at rates of
4000BOEPD. Two independent resource reports confirmed Providence's
assessment of 346MMBOE of recoverable hydrocarbons within the assessed
reservoirs, and a significant increase in recoverable volumes is
expected to be proven once development drilling confirms the extent and
quality of the additional reservoirs present within the Barryroe field
structural closure.
Providence is fully committed to push ahead with the production of both
oil and gas from the Barryroe field and entered in a period of farmout
exclusively with SpotOn Energy until October 31st, 2020, with the aim of
agreeing a Barryroe field development partnership and a phased Barryroe
development plan, designed to progress economic production from a low
risk, low emissions, energy efficient hydrocarbon development offshore
Ireland.
SpotOn Energy has established relationships with a consortium of world
class services companies willing to underwrite the quality of the
Barryroe project by taking development risk and deferring a portion of
their normal fees into the production phase of the project. Farmout
discussions are progressing on schedule.
In 2020 Ireland will import 100% of its oil and 70% of its gas
requirements. Energy security is essential for a strong economy, and
government economic forecasts confirm the long term need for efficiently
developed hydrocarbons to support energy reliability and stability in
Ireland. Providence Resources considers the Barryroe development to be a
project of national importance which, when approved and commissioned,
will make a significant contribution to the Irish economy and exchequer
and bring direct long-term financial benefits and employment to Cork and
surrounding areas.
Concurrently, Providence Renewables (a 100% owned subsidiary of
Providence Resources) is assessing the benefits of introducing carbon
capture into the scope of the Barryroe development, with the ambition of
delivering a sustainable hydrocarbon development in the Cork area.
Carbon capture and storage (CCS), with government support, can ensure
locally produced natural gas is a source of reliable carbon neutral
energy, contributing to delivery of the government's target for a carbon
neutral economy by 2050."
H1 2020 OPERATIONAL HIGHLIGHTS
Barryroe, North Celtic Sea (SEL1/11)
Reassignment of equity back to Providence/EXOLA and Lansdowne from APEC
progressed with the Department of Communications Climate Action and the
Environment (DCCAE).
A Lease Undertaking application to DCCAE is pending
2 Drilling Site Surveys complete
1 Planning Application to DCCAE is in the final stage of regulatory
review and is expected to be awarded shortly.
The Farmout to SpotOn Energy is progressing on schedule and we are
actively engaged in planning the development stages for this project and
bringing a consortium of global service industry leaders to the table to
partner in the development.
Dragon, St. George's Channel (SEL 1/07)
Under discussion with the regulatory authorities
Hook Head, North Celtic Sea (SEL 2/07)
Subject of Lease Undertaking application
Helvick/Dunmore, Celtic Sea (Lease Undertaking)
Subject to MFDevCO work programme
Kish Bank, Kish Bank Basin (SEL 2/11)
Licence expired August 17(th) , 2020.
Dunquin South, Southern Porcupine (FEL 3/04)
May 2020 Providence advised JV partners of its withdrawal from the
licence. (Under discussion with the regulatory authorities)
Avalon, Southern Porcupine (FEL 2/19)
May 2020, Providence advised JV partners of its withdrawal from the
licence. (Under discussion with the regulatory authorities)
Spanish Point, Northern Porcupine (FEL 2/04) Work programme complete.
Relinquishment in progress
H1 2020 FINANCIAL HIGHLIGHTS
Operating loss of EUR1.063 million for the period compared to EUR5.309
million in 2019, attributable to the cost reduction initiatives put in
place by the company
Core corporate administration expense of EUR0.819m (2019: EUR2.208m)
down 63% year upon year due to the cost reduction program
Loss for the period was EUR9.247 million versus EUR5.543 million in 2019
(including EUR7.764 million in financing expense in relation to fair
value movement of warrants issued during the period as part of the
equity raise in May 2020)
Loss per share of 1.30 cents versus 0.93 cents in 2019
At 30 June 2020 total cash & cash equivalents were EUR2.269 million
(2019: EUR1.788 million)
The Company had no debt at 30th June 2019 (2019: nil)
The total issued and voting share capital at 30th June 2020 was
841,514,060 ordinary shares of
EUR0.001 each
POST H1 2020 EVENTS - BOARD CHANGES
On July 20(th) , 2020, the board accepted Angus McCoss's resignation
from the board
Andrew Mackay was appointed as an Independent Non-Executive Director
with effect from the 3 July 2020. Andrew Mackay has over 40 years'
experience in the industry. He founded NRG Group in 1988 and has
extensive experience in the upstream oil & gas with a focus upon well
engineering and regulatory frameworks and control.
OUTLOOK
Providence Resources is funded through July 2021 and expects to complete
the Barryroe Farmout within existing resources. During the April 2020
fund raise Providence Resource issued GBP0.03 and GBP0.09 warrants as
part of the capital raise. There is an expectation that near-term
funding will be met through warrant exercise following the completion of
the farmout process. The recent exercise of 16,433,333 warrants has
generated additional cash of GBP492,999.99 into the Company.
Following the recent general election, the Irish government extended the
ban on future oil exploration to include gas. The government confirmed
that existing licences would be unaffected and will proceed as normal.
Providence Resources has title over several licences in the North Celtic
Sea which contain both oil and gas discoveries. It is our intention to
focus our technical efforts upon assessing near field exploration
potential associated with existing discoveries, including Barryroe, and
working with the government to maximise the economic recovery from our
existing licences.
ANNOUNCEMENT & FORWARD-LOOKING STATEMENTS
This announcement contains certain forward-looking statements. Actual
results may differ materially from those projected or implied in such
forward-looking statements. Such forward-looking information involves
risks and uncertainties that could significantly affect expected
results. No representation is made that any of those statements or
forecasts will come to pass or that any forecast results will be
achieved. You are cautioned not to place any reliance on such statements
or forecasts. Those forward-looking and other statements speak only as
at the date of this announcement. Providence Resources P.l.c undertakes
no obligation to update any forward-looking statements.
ABOUT PROVIDENCE RESOURCES PLC
Providence Resources P.l.c. is an Irish based Oil & Gas Energy company
with a portfolio of appraisal and exploration assets located offshore
Ireland. Providence's shares are quoted on the AIM in London and the
Euronext Growth market in Dublin. Further information on Providence can
be found on www.providenceresources.com
INVESTOR ENQUIRIES
Providence Resources P.l.c. Tel: +353 1 219 4074
Alan Linn, Chief Executive Officer
J&E Davy Tel: +353 1 679 6363
Anthony Farrell
MEDIA ENQUIRIES
Murray Consultants Tel: +353 87 6909735
Joe Heron
PROVIDENCE RESOURCES P.l.c.
Condensed consolidated income statement
For the 6 months ended 30 June 2020
6 months ended 30 June 2020 6 months ended 30 June 2019 Year ended 31 December 2019
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Continuing operations
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Administration
expenses 2 (1,063) (2,235) (4,542)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Pre-licence
expenditure - - (273)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Impairment of
exploration and
evaluation assets 4,8 - (3,072) (21,121)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Operating loss (1,063) (5,307) (25,936)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Finance income 1 22 30
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Finance expense 3 (8,185) (258) (947)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Loss before income tax (9,247) (5,543) (26,853)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Income tax expense - - -
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Loss for the period (9,247) (5,543) (26,853)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Loss per share (cent)
-- continuing
operations
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
Basic and diluted loss
per share 10 (1.30) (0.93) (4.39)
---------------------- ----------- ----------------------------------- ------------------------------- -----------------------------
The total recognised loss for the period is entirely attributable to
equity holders of the Company.
The accompanying notes are an integral part of these condensed
consolidated financial statements.
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of comprehensive income
For the 6 months ended 30 June 2020
6 months ended 30 June 2020 6 months ended 30 June 2019 Year ended 31 December 2019
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
------------------------------------------------------ ------ --------------------------- --------------------------- ---------------------------
Loss for the financial period (9,247) (5,543) (26,853)
-------------------------------------------------------------- --------------------------- --------------------------- ---------------------------
OCI Items that may be reclassified into profit or
loss
------------------------------------------------------ ------ --------------------------- --------------------------- ---------------------------
Foreign exchange translation differences 206 389 1,195
-------------------------------------------------------------- --------------------------- --------------------------- ---------------------------
Total income recognised in other comprehensive income
from continuing operations 206 389 1,195
------------------------------------------------------ ------ --------------------------- --------------------------- ---------------------------
Total comprehensive expense for the period (9,041) (5,154) (25,658)
-------------------------------------------------------------- --------------------------- --------------------------- ---------------------------
The total comprehensive expense recognised for the period is entirely
attributable to equity holders of the Company.
The accompanying notes are an integral part of these condensed
consolidated financial statements.
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of financial position
As at 30 June 2020
30 June 2020 30 June 2019 31 December 2019
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
--------------------------------------------------- ----- ------------ ------------ ----------------
Assets
--------------------------------------------------- ----- ------------ ------------ ----------------
Exploration and evaluation assets 4 65,940 83,214 65,377
--------------------------------------------------- ----- ------------ ------------ ----------------
Property, plant and equipment 24 75 38
--------------------------------------------------- ----- ------------ ------------ ----------------
Total non-current assets 65,964 83,289 65,415
--------------------------------------------------- ----- ------------ ------------ ----------------
Trade and other receivables 5 240 661 398
--------------------------------------------------- ----- ------------ ------------ ----------------
Cash and cash equivalents 2,269 1,788 710
--------------------------------------------------- ----- ------------ ------------ ----------------
Total current assets 2,509 2,449 1,108
--------------------------------------------------- ----- ------------ ------------ ----------------
Total assets 68,473 85,738 66,523
--------------------------------------------------- ----- ------------ ------------ ----------------
Equity
--------------------------------------------------- ----- ------------ ------------ ----------------
Share capital 6 71,696 71,452 71,512
--------------------------------------------------- ----- ------------ ------------ ----------------
Share premium 6 253,240 247,918 251,300
--------------------------------------------------- ----- ------------ ------------ ----------------
Undenominated capital 623 623 623
--------------------------------------------------- ----- ------------ ------------ ----------------
Foreign currency translation reserve 10,293 9,281 10,087
--------------------------------------------------- ----- ------------ ------------ ----------------
Share based payment reserve 858 1,785 642
--------------------------------------------------- ----- ------------ ------------ ----------------
Retained deficit (284,362) (254,302) (274,898)
--------------------------------------------------- ----- ------------ ------------ ----------------
Total equity attributable to equity holders of the
company 52,348 76,757 59,266
--------------------------------------------------- ----- ------------ ------------ ----------------
Liabilities
--------------------------------------------------- ----- ------------ ------------ ----------------
Decommissioning provision 8 6,014 7,674 5,733
--------------------------------------------------- ----- ------------ ------------ ----------------
Warrant liability 9 4,356 - -
--------------------------------------------------- ----- ------------ ------------ ----------------
Lease liability - - 9
--------------------------------------------------- ----- ------------ ------------ ----------------
Total non-current liabilities 10,370 7,674 5,742
--------------------------------------------------- ----- ------------ ------------ ----------------
Warrant liability 9 4,561 - -
--------------------------------------------------- ----- ------------ ------------ ----------------
Trade and other payables 7 1,194 1,307 1,515
--------------------------------------------------- ----- ------------ ------------ ----------------
Total current liabilities 5,755 1,307 1,515
--------------------------------------------------- ----- ------------ ------------ ----------------
Total liabilities 16,125 8,981 7,257
--------------------------------------------------- ----- ------------ ------------ ----------------
Total equity and liabilities 68,473 85,738 66,523
--------------------------------------------------- ----- ------------ ------------ ----------------
The accompanying notes are an integral part of these condensed
consolidated financial statements.
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of changes in Equity
For the 6 months ended 30 June 2020
Foreign Share
Currency Based
Share Undenominated Share Translation Payment Retained
Capital capital Premium Reserve Reserve Deficit Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
-------------- ------- -------------- ------- ----------- ------- --------- --------
At 1 January
2020 71,512 623 251,300 10,087 642 (274,898) 59,266
-------------- ------- -------------- ------- ----------- ------- --------- --------
Loss for
financial
period - - - - - (9,247) (9,247)
-------------- ------- -------------- ------- ----------- ------- --------- --------
Currency
translation - - - 206 - - 206
-------------- ------- -------------- ------- ----------- ------- --------- --------
Total
comprehensive
income - - - 206 - (9,247) (9,041)
-------------- ------- -------------- ------- ----------- ------- --------- --------
Transactions
with owners,
recorded
directly in
equity
-------------- ------- -------------- ------- ----------- ------- --------- --------
Shares issued
in period 184 - 1,940 - - (217) 1,907
-------------- ------- -------------- ------- ----------- ------- --------- --------
Share based
payments in
period - - - - 216 - 216
-------------- ------- -------------- ------- ----------- ------- --------- --------
At 30 June
2020 71,696 623 253,240 10,293 858 (284,362) 52,348
-------------- ------- -------------- ------- ----------- ------- --------- --------
At 1 January
2019 71,452 623 247,918 8,892 1,745 (248,759) 81,871
-------------- ------- -------------- ------- ----------- ------- --------- --------
Loss for
financial
period - - - - - (5,543) (5,543)
-------------- ------- -------------- ------- ----------- ------- --------- --------
Currency
translation - - - 389 - - 389
-------------- ------- -------------- ------- ----------- ------- --------- --------
Total
comprehensive
income - - - 389 - (5,543) (5,154)
-------------- ------- -------------- ------- ----------- ------- --------- --------
Transactions
with owners,
recorded
directly in
equity
-------------- ------- -------------- ------- ----------- ------- --------- --------
Share based
payments in
period - - - - 40 - 40
-------------- ------- -------------- ------- ----------- ------- --------- --------
At 30 June
2019 71,452 623 247,918 9,281 1,785 (254,302) 76,757
-------------- ------- -------------- ------- ----------- ------- --------- --------
At 1 January
2019 71,452 623 247,918 8,892 1,745 (248,759) 81,871
-------------- ------- -------------- ------- ----------- ------- --------- --------
Loss for
financial
year - - - - - (26,853) (26,853)
-------------- ------- -------------- ------- ----------- ------- --------- --------
Currency
translation - - - 1,195 - - 1,195
-------------- ------- -------------- ------- ----------- ------- --------- --------
Total
comprehensive
income - - - 1,195 - (26,853) (25,658)
-------------- ------- -------------- ------- ----------- ------- --------- --------
Transactions
with owners,
recorded
directly in
equity
-------------- ------- -------------- ------- ----------- ------- --------- --------
Share based
payments - - - - 40 - 40
-------------- ------- -------------- ------- ----------- ------- --------- --------
Share options
lapsed in
year - - - - (1,143) 1,143 -
-------------- ------- -------------- ------- ----------- ------- --------- --------
Shares issued
in year 60 - 3,382 - - (429) 3,013
-------------- ------- -------------- ------- ----------- ------- --------- --------
Transactions
with owners,
recorded
directly in
equity 60 - 3,382 - (1,103) 714 3,053
-------------- ------- -------------- ------- ----------- ------- --------- --------
At 31 December
2019 71,512 623 251,300 10,087 642 (274,898) 59,266
-------------- ------- -------------- ------- ----------- ------- --------- --------
PROVIDENCE RESOURCES P.l.c.
Consolidated statement of cash flows
For the 6 months ended 30 June 2020
6 months 6 months Year
ended 30 ended 30 ended 31
June June December
2020 2019 2019
------------------------------------------------------ --------- --------- --------
Unaudited Unaudited Audited
------------------------------------------------------ --------- --------- --------
EUR'000 EUR'000 EUR'000
------------------------------------------------------ --------- --------- --------
Cash flows from operating activities
------------------------------------------------------ --------- --------- --------
Loss before income tax for the period (9,247) (5,543) (26,853)
------------------------------------------------------ --------- --------- --------
Adjustments for:
------------------------------------------------------ --------- --------- --------
Depletion and depreciation 14 9 35
------------------------------------------------------ --------- --------- --------
Impairment of exploration and evaluation assets - 3,072 21,121
------------------------------------------------------ --------- --------- --------
Finance income (1) (22) (30)
------------------------------------------------------ --------- --------- --------
Finance expense 8,185 258 947
------------------------------------------------------ --------- --------- --------
Equity settled share based payment charge 216 40 40
------------------------------------------------------ --------- --------- --------
Foreign exchange 34 (13) (122)
------------------------------------------------------ --------- --------- --------
Change in trade and other receivables 158 (197) 66
------------------------------------------------------ --------- --------- --------
Change in trade and other payables (321) 608 825
------------------------------------------------------ --------- --------- --------
Net cash outflow from operating activities (962) (1,788) (3,971)
------------------------------------------------------ --------- --------- --------
Cash flows from investing activities
------------------------------------------------------ --------- --------- --------
Interest received 1 22 30
------------------------------------------------------ --------- --------- --------
Acquisition of exploration and evaluation assets (390) (4,013) (6,075)
------------------------------------------------------ --------- --------- --------
Acquisition of property, plant and equipment - (56) (56)
------------------------------------------------------ --------- --------- --------
Net cash used in investing activities (389) (4,047) (6,101)
------------------------------------------------------ --------- --------- --------
Cashflows from financing activities
------------------------------------------------------ --------- --------- --------
Proceeds from issue of security instruments (see note
6) 3,277 - 3,442
------------------------------------------------------ --------- --------- --------
Security instrument Issue costs (350) - (429)
------------------------------------------------------ --------- --------- --------
Net cash from financing activities 2,927 - 3,013
------------------------------------------------------ --------- --------- --------
Net increase/(decrease) in cash and cash equivalents 1,576 (5,835) (7,059)
------------------------------------------------------ --------- --------- --------
Cash and cash equivalents at beginning of period 710 7,617 7,617
------------------------------------------------------ --------- --------- --------
Effect of exchange rate fluctuations on cash and cash
equivalents (17) 6 152
------------------------------------------------------ --------- --------- --------
Cash and cash equivalents at end of period 2,269 1,788 710
------------------------------------------------------ --------- --------- --------
The accompanying notes are an integral part of these condensed
consolidated financial statements.
PROVIDENCE RESOURCES P.l.c.
Note 1 -- Accounting Policies
General Information
Providence Resources P.l.c ("the Company") is a Company incorporated and
domiciled in the Republic of Ireland. The registration number of the
Company is 268662 and the address of the registered office is Paramount
Court, Corrig Road, Sandyford Business Park, Dublin 18, D18 R9C7. The
unaudited consolidated interim financial statements of the Company for
the six months ended 30 June 2020 (the "Interim Financial Statements")
include the Company and its subsidiaries (together referred to as the
"Group"). The Interim Financial Statements were authorised for issue by
the Directors on 30 September 2020.
Basis of accounting
These interim financial statements have been prepared in accordance with
IAS 34 Interim Financial Reporting and should be read in conjunction
with the Group's last annual consolidated financial statements as at and
for the year ended 31 December 2019 ('last annual financial
statements'). They do not include all of the information required for a
complete set of IFRS financial statements. However, selected explanatory
notes are included to explain events and transactions that are
significant to an understanding of the changes in the Group's financial
position and performance since the last annual financial statements.
The 30 June 2020 figures and the 30 June 2019 comparative figures do not
constitute statutory financial statements of the Group within the
meaning of the Companies Act, 2014. The consolidated financial
statements of the Group for the year ended 31 December 2019, together
with the independent auditor's report thereon, were filed with the Irish
Registrar of Companies following the Company's Annual General Meeting
and are also available on the Company's Website. The auditor's report on
those financial statements was unqualified and contains a "material
uncertainty related to going concern" paragraph.
The condensed set of financial statements included in this half-yearly
financial report has been prepared on a going concern basis as the
Directors consider that the Group has adequate resources to continue in
operational existence for the foreseeable future (See below for further
details on the Directors assessment of going concern).
In preparing these interim financial statements, management has made
judgements and estimates that affect the application of accounting
policies and the reported amounts of assets and liabilities, income and
expense. Actual results may differ from these estimates. The significant
judgements made by management in applying the Group's accounting
policies and the key sources of estimation uncertainty were the same as
those described in the last annual report.
The Interim Financial Statements are presented in Euro, rounded to the
nearest thousand, which is the functional currency of the Company and
also the presentation currency for the Group's financial reporting.
The significant accounting policies applied in these interim financial
statements are the same as those applied by the Group in its
consolidated financial statements as at and for the year ending 31
December 2019.
As part of a funding round, the Company issued warrants during the
current period. The Group's accounting policy relating to these is as
follows:
The Group classifies instruments issued as financial liabilities or
equity instruments in accordance with the substance of the contractual
terms of the instruments. The warrants issued are derivative in nature
and are liability classified. They do not qualify for equity
classification as any cash settlement on exercise of these warrants will
be received in a foreign currency (to the Group's functional currency),
GBP sterling. The warrant liabilities are recognised at their fair
value on initial recognition and subsequently are measured at fair value
through profit or loss. Any incremental direct costs associated with
the issuance of warrants is taken as an immediate charge to finance
costs through the income statement.
Amendments to standards and interpretations which are effective for the
Group from 1 January 2020 do not have a material effect on the results
or financial posting in the interim financial statements as at and for
the period ending 30 June 2020.
Going concern
The Directors have considered carefully the financial position of the
Group and, in that context, have prepared the interim financial
statements on a going concern basis.
The process of farming out Barryroe with SpotOn Energy Limited is
ongoing and, once it is completed, will reduce the Group's cost exposure
due to funding of the Barryroe program being provided by the SpotOn
Energy consortium.
SpotOn Energy has exclusivity until 31 October 2020, with the aim of
completing a farm-out agreement with the Group by that time. SpotOn
Energy Limited invested GBP300,000 in the equity placing on 5 May 2020
and a further GBP200,000 through a subscription agreement on 28 May
2020.
Discussions are progressing, and on 31 July 2020 the Company announced
the composition of the consortium participating in the Barryroe project.
The consortium is made up of Schlumberger, AGR, Maresk Drilling, Keppel
FELS, Aker Solutions and Aibel AS. The members of the consortium are
"blue chip" service companies capable of progressing the project to the
highest technical standards.
In the event that the farm-out does not complete with SpotOn Energy, the
Group will re-commence the Barryroe farm-out process.
The business re-engineering has been completed in this period, and
resulted in significant reductions in the Group's operating expenditure.
Control of expenditure continues to receive a high priority.
The Group is monitoring the impact of Covid-19 on its business and notes
an impact on the global market and demand.
The Directors have reviewed the cashflow forecast for the next 12 months
and the underlying assumptions. The primary risk factor relates to
completion of the farm-out with SpotOn Energy. Taking into account all
information currently available, including the recent equity placing
with GBP0.03 and GBP0.09 warrants attached and other options available
to fund the commitments, including other equity funding alternatives,
the Directors believe that the Group will have sufficient funds
available over the next 12 months to meet all its commitments as they
fall due.
However, the failure to complete a farm-out on Barryroe represents a
material uncertainty that may cast significant doubt upon the Group and
Company's ability to continue as a going concern in the long term and
that therefore the Group and Company may be unable to continue realising
assets and discharging liabilities in the normal course of business.
After making enquiries and considering the uncertainties described above,
the Directors have a reasonable expectation that the Group and Company
have adequate resources to continue in operational existence for the
foreseeable future. Accordingly, the Directors have adopted the going
concern basis in preparing the interim financial statements and the
interim financial statements do not include any adjustments that would
be necessary if this basis were inappropriate.
PROVIDENCE RESOURCES P.l.c.
Note 2 -- Administration Expenses
6 months ended 30 6 months ended 30 Year ended 31
June 2020 June 2019 December 2019
------------------ ------------------ ------------------ ------------------
Unaudited Unaudited Audited
------------------ ------------------ ------------------ ------------------
EUR'000 EUR'000 EUR'000
------------------ ------------------ ------------------ ------------------
Corporate,
exploration and
development
expenses 819 2,208 3,857
------------------ ------------------ ------------------ ------------------
Restructuring
costs - 580 1,170
------------------ ------------------ ------------------ ------------------
Share based
payment expense
(note 11) 216 40 40
------------------ ------------------ ------------------ ------------------
Foreign exchange
losses/(gains)
net 28 (86) (120)
------------------ ------------------ ------------------ ------------------
Total
administration
expenses for the
period 1,063 2,742 4,947
------------------ ------------------ ------------------ ------------------
Capitalised in
exploration and
evaluation
assets - (507) (405)
------------------ ------------------ ------------------ ------------------
Total charged to
the income
statement 1,063 2,235 4,542
------------------ ------------------ ------------------ ------------------
PROVIDENCE RESOURCES P.l.c.
Note 3 -- Finance Expense
6 months 6 months Year
ended 30 ended 30 ended 31
June June December
2020 2019 2019
--------------------------------------------------- --------- --------- --------
Unaudited Unaudited Audited
--------------------------------------------------- --------- --------- --------
EUR'000 EUR'000 EUR'000
--------------------------------------------------- --------- --------- --------
Unwinding of discount on decommissioning provision
(note 8) 287 213 521
--------------------------------------------------- --------- --------- --------
Foreign exchange on decommissioning provision - 45 424
--------------------------------------------------- --------- --------- --------
Interest on right to use asset 1 - 2
--------------------------------------------------- --------- --------- --------
Issued costs associated with the warrants 133 - -
--------------------------------------------------- --------- --------- --------
Movement in fair value of warrants (note 9) 7,764 - -
--------------------------------------------------- --------- --------- --------
Total finance expense recognised in income
statement 8,185 258 947
--------------------------------------------------- --------- --------- --------
PROVIDENCE RESOURCES P.l.c.
Note 4 -- Exploration and evaluation assets
EUR'000
------------------------------------ --------
Cost and book value
------------------------------------ --------
At 1 January 2019 81,867
------------------------------------ --------
Additions 3,702
------------------------------------ --------
Cash calls received in period (196)
------------------------------------ --------
Administration expenses capitalised 507
------------------------------------ --------
Impairment charge (3,072)
------------------------------------ --------
Foreign exchange translation 406
------------------------------------ --------
At 30 June 2019 83,214
------------------------------------ --------
At 1 January 2019 81,867
------------------------------------ --------
Additions 5,670
------------------------------------ --------
Administration expenses capitalised 405
------------------------------------ --------
Impairment charge (23,763)
------------------------------------ --------
Foreign exchange translation 1,198
------------------------------------ --------
At 31 December 2019 65,377
------------------------------------ --------
At 1 January 2020 65,377
------------------------------------ --------
Additions 390
------------------------------------ --------
Foreign exchange translation 173
------------------------------------ --------
At 30 June 2020 65,940
------------------------------------ --------
The exploration and evaluation asset balance at 30 June 2020 relates to
the Group's Barryroe interest.
PROVIDENCE RESOURCES P.l.c.
Note 5 -- Trade and other receivables
30 June 2020 30 June 2019 31 December 2019
-------------------------------- ------------ ------------ ----------------
Unaudited Unaudited Audited
-------------------------------- ------------ ------------ ----------------
EUR'000 EUR'000 EUR'000
-------------------------------- ------------ ------------ ----------------
VAT recoverable 46 72 53
-------------------------------- ------------ ------------ ----------------
Prepayments 155 190 242
-------------------------------- ------------ ------------ ----------------
Amounts due from joint operation
partner 39 399 103
-------------------------------- ------------ ------------ ----------------
Total 240 661 398
-------------------------------- ------------ ------------ ----------------
PROVIDENCE RESOURCES P.l.c.
Note 6 -- Share Capital and Share Premium
Number
------------------------------------------------------ --------- --------- --------
Authorised: '000 EUR'000
------------------------------------------------------ --------- --------- --------
At 1 January 2020
------------------------------------------------------ --------- --------- --------
Deferred shares of EUR0.011 each 9,944,066 109,385
------------------------------------------------------ --------- --------- --------
Ordinary shares of EUR0.001 each 986,847 987
------------------------------------------------------ --------- --------- --------
At 30 June 2020
------------------------------------------------------ --------- --------- --------
Deferred shares of EUR0.011 each 9,944,066 109,385
------------------------------------------------------ --------- --------- --------
Ordinary shares of EUR0.001 each 1,800,000 1,800
------------------------------------------------------ --------- --------- --------
Share Share
Number Capital Premium
------------------------------------------------------ --------- --------- --------
Issued: '000 EUR'000 EUR'000
------------------------------------------------------ --------- --------- --------
Deferred shares of EUR0.011 each
------------------------------------------------------ --------- --------- --------
At 31 December 2018 and 30 June 2019 1,062,442 11,687 5,691
------------------------------------------------------ --------- --------- --------
Re-designated as Ordinary Shares at 30 September 2019 5,378,931 59,168 -
------------------------------------------------------ --------- --------- --------
At 31 December 2019 and 30 June 2020 6,441,373 70,855 5,691
------------------------------------------------------ --------- --------- --------
Ordinary share of EUR0.001 each
------------------------------------------------------ --------- --------- --------
At 31 December 2018 and 30 June 2019 (Ordinary Shares
of EUR0.10 each) 597,659 59,765 242,227
------------------------------------------------------ --------- --------- --------
Re-designated as Ordinary Shares of EUR0.001 each
at 30 September 2019 597,659 597 242,227
------------------------------------------------------ --------- --------- --------
Shares issued during the year 59,766 60 3,382
------------------------------------------------------ --------- --------- --------
At 31 December 2019 (Ordinary shares of EUR0.001 each) 657,425 657 245,609
------------------------------------------------------ --------- --------- --------
Shares issued in period 184,089 184 1,940
------------------------------------------------------ --------- --------- --------
At 30 June 2020 841,514 841 247,549
------------------------------------------------------ --------- --------- --------
At 30 June 2020 (Total deferred and Ordinary shares) 7,282,887 71,696 253,240
------------------------------------------------------ --------- --------- --------
On 5 May 2020, the Company issued 177,973,004 Ordinary Shares as part of
a placing and subscription agreement which raised c. EUR3.1m from
security instruments before expenses. Each of these security instruments
comprised of one Ordinary Share of EUR0.001, one GBP0.03 warrant and one
GBP0.09 warrant.
On issuance, a fair value of EUR1.9m was attributed to the Ordinary
Shares (share capital / share premium outlined above) and EUR1.2m to the
Warrant instruments based on the effective share price at that date. In
line with the Group's accounting policies these Warrants are presented
as financial liabilities (note 9).
The holder of each warrant can exercise its rights under the instrument
which allows that holder to convert the warrant into one ordinary share,
with a par amount of EUR0.001, by payment of the exercise price of
GBP0.03 or GBP0.09, as applicable. The warrants are non-transferrable.
The GBP0.03 warrants expire in May 2021 while the GBP0.09 warrants
expire in May 2022.
On 28 May 2020, the Company issued 6,116,208 Ordinary Shares through a
subscription agreement which raised c. EUR0.2m.
PROVIDENCE RESOURCES P.l.c.
Note 7 -- Trade and other payables
30 June 2020 30 June 2019 31 December 2019
---------------- ------------ ------------ ----------------
Unaudited Unaudited Audited
---------------- ------------ ------------ ----------------
EUR'000 EUR'000 EUR'000
---------------- ------------ ------------ ----------------
Accruals 487 882 385
---------------- ------------ ------------ ----------------
Other payables 690 380 1,112
---------------- ------------ ------------ ----------------
Lease liability 17 45 18
---------------- ------------ ------------ ----------------
Total 1,194 1,307 1,515
---------------- ------------ ------------ ----------------
PROVIDENCE RESOURCES P.l.c.
Note 8 -- Decommissioning provision
30 June 2020 30 June 2019 31 December 2019
-------------------------------- ------------ ------------ ----------------
Unaudited Unaudited Audited
-------------------------------- ------------ ------------ ----------------
EUR'000 EUR'000 EUR'000
-------------------------------- ------------ ------------ ----------------
At beginning of year 5,733 7,406 7,406
-------------------------------- ------------ ------------ ----------------
Unwinding of discount 287 213 521
-------------------------------- ------------ ------------ ----------------
Foreign exchange (gain)/loss
translation (6) 55 448
-------------------------------- ------------ ------------ ----------------
Fair value adjustment in
provision liability - - (2,642)
-------------------------------- ------------ ------------ ----------------
Total 6,014 7,674 5,733
-------------------------------- ------------ ------------ ----------------
During 2019, the Group reassessed the estimated decommissioning period
and this resulted in an adjustment of EUR2.6m. The adjustment was netted
against the exploration and evaluation impairment line within the income
statement. The provision for decommissioning is reviewed annually. The
provision has been calculated assuming industry established oilfield
decommissioning techniques and technology at current prices and is
discounted at 10% per annum, reflecting the associated risk profile.
PROVIDENCE RESOURCES P.l.c.
Note 9 - Warrants
On 5 May 2020, the Company raised c. EUR3.1m by the issue of security
instruments with each security instrument comprising one ordinary share,
with a par amount of EUR0.001, one GBP0.03 warrant (expires in May 2021)
and one GBP0.09 warrant (expires in May 2022). The fair value of the
warrants was calculated using Black Scholes model. The following key
input assumptions were applied to the initial valuation on issuance of
these instruments:
GBP0.03 Warrants GBP0.09 Warrants
------------------------------ ---------------- ----------------
Number of warrants 177,973,004 177,973,004
------------------------------ ---------------- ----------------
Volatility 148% 148%
------------------------------ ---------------- ----------------
Time period 1 Year 2 Years
------------------------------ ---------------- ----------------
Dividend yield 0% 0%
------------------------------ ---------------- ----------------
Risk free interest rate (0.01%) (0.01%)
------------------------------ ---------------- ----------------
Exercise price GBP0.03 GBP0.09
------------------------------ ---------------- ----------------
Placing effective Share price 0.01068 0.01068
------------------------------ ---------------- ----------------
Initial value of security 0.00299 0.00349
------------------------------ ---------------- ----------------
Fair value EUR531,444 EUR621,982
------------------------------ ---------------- ----------------
The c. EUR3.1m raised before expenses, from previous and new shareholder
investors, for the security instruments in May 2020 was considered the
transaction price fair value. The split of this fair value on issuance
of these security instruments, based on a placing effective share price
of EUR0.01068, was EUR0.531m for the GBP0.03 Warrants, EUR0.622m for the
GBP0.09 Warrants and EUR1.901m for the Ordinary Shares (split between
share capital and share premium account (note 6)).
On 30 June 2020, the warrants were fair valued using appropriate inputs
including the closing share price on that day of EUR0.0448. The fair
value movement being the difference between initial valuation and 30
June 2020 valuation in the amount of EUR7.764m going through the finance
expense line in the income statement.
GBP0.03 Warrants GBP0.09 Warrants
------------------------------ ---------------- ----------------
Number of warrants 177,973,004 177,973,004
------------------------------ ---------------- ----------------
Volatility 148% 148%
------------------------------ ---------------- ----------------
Time period .85 Year 1.85 Years
------------------------------ ---------------- ----------------
Dividend yield 0% 0%
------------------------------ ---------------- ----------------
Risk free interest rate (0.01%) (0.01%)
------------------------------ ---------------- ----------------
Exercise price GBP0.03 GBP0.09
------------------------------ ---------------- ----------------
Closing share price 30 June EUR0.0448 EUR0.0448
------------------------------ ---------------- ----------------
Fair value as at 30 June 2020 EUR4,560,940 EUR4,356,476
------------------------------ ---------------- ----------------
The following table shows the fair value movement:
Initial valuation 30 June 2020 Fair value movement
----------------- ---------------- ------------ -------------------
EUR'000 EUR'000 EUR'000
----------------- ---------------- ------------ -------------------
EUR531 GBP0.03 warrants EUR4,561 EUR4,030
----------------- ---------------- ------------ -------------------
EUR622 GBP0.09 warrants EUR4,356 EUR3,734
----------------- ---------------- ------------ -------------------
EUR1,153 EUR8,917 EUR7,764
----------------- ---------------- ------------ -------------------
PROVIDENCE RESOURCES P.l.c.
Note 10 -- Earnings per share
6 months 6 months Year
ended 30 ended 30 ended 31
June June December
2020 2019 2019
------------------------------------------------------ --------- --------- --------
Unaudited Unaudited Audited
------------------------------------------------------ --------- --------- --------
EUR'000 EUR'000 EUR'000
------------------------------------------------------ --------- --------- --------
Loss attributable to equity holders of the company
from continuing operations (9,247) (5,543) (26,853)
------------------------------------------------------ --------- --------- --------
The basic weighted average number of Ordinary shares
in issue ('000)
------------------------------------------------------ --------- --------- --------
In issue at beginning of year and end of period 657,425 597,659 597,659
------------------------------------------------------ --------- --------- --------
Adjusted for share issue in year 55,739 - 14,308
------------------------------------------------------ --------- --------- --------
Weighted average number of ordinary shares 713,164 597,659 611,967
------------------------------------------------------ --------- --------- --------
Basic and diluted loss per share (cent) -- continuing
operations (1.30) (0.93) (4.39)
------------------------------------------------------ --------- --------- --------
There is no difference between the loss per ordinary share and the
diluted loss per share for the reported periods as all potentially
dilutive ordinary shares outstanding are anti-dilutive.
There were 41,150,000 (2019: 28,325,000) anti-dilutive share options and
355,946,008 (2019: Nil) anti-dilutive warrants in issue as at 30 June
2020.
PROVIDENCE RESOURCES P.l.c.
Note 11 -- Share schemes
Share option schemes were introduced in August 1997 (expired August
2007), May 2005 (expired October 2015) and June 2009 (expired in June
2019) under which share options may be offered to employees, Directors
and consultants. In addition, a long-term incentive plan was introduced
in 2016. Options are recommended at a level to attract retain and
motivate participants in the competitive environment in which the Group
operates, The Remuneration Committee reviews and assesses proposals to
grant share options to participants.
The Group operates the following employee share schemes:
2020 Scheme
In 2020, the directors adopted a share option scheme which contains
certain performance criteria. No options can be issued after 10 years of
the scheme. The option price is the market price immediately preceding
the date of the grant. The "2020 scheme" operates as an equity-settled
share option scheme and the options granted are subject to certain
conditions. No option is exercisable more than seven years after grant
date and no option is exercisable within one year of grant. The "2020
scheme" was approved at the EGM on the 5 May 2020.
The applicable criteria for the exercise of the options are;
1. 33% of the total number of options granted are exercisable after one year
of grant provided that the agreed criteria by the Remuneration committee
have been met.
2. 33% of the total number of options granted are exercisable after two
years of grant provided that the agreed criteria by the Remuneration
committee have been met.
3. The remaining 33% of the total number of options granted are exercisable
after a further year has elapsed provided that the agreed criteria by the
Remuneration committee have been met.
During the period, 36,500,000 share options were granted under the 2020
Share option scheme. 31,500,000 options were granted to the Directors
and 5,000,000 options were granted to employees.
Grant Date 13 January 2020 6 April 2020
-------------------------- --------------- ------------
Number of options granted 15,000,000 21,500,000
-------------------------- --------------- ------------
Volatility 103% 108%
-------------------------- --------------- ------------
Time period 7 Years 7 Years
-------------------------- --------------- ------------
Dividend yield 0% 0%
-------------------------- --------------- ------------
Risk free interest rate (0.01%) (0.01%)
-------------------------- --------------- ------------
Exercise price GBP0.04 GBP0.03
-------------------------- --------------- ------------
The total share based payments expense in the period to 30 June 2020
charged to the income statement was EUR216,000 (2019: EUR40,000).
PROVIDENCE RESOURCES P.l.c.
Note 12 - Commitments
As at 30 June 2020, the Group has capital commitments of approximately
EUR0.3m (31 December 2019: EUR0.6m) to contribute to its share of costs
of exploration and evaluation activities.
PROVIDENCE RESOURCES P.l.c.
Note 13 -- Post Balance Sheet Events
On 25 August 2020, 333,333 warrants were exercised for GBP0.03 each
raising total equity of GBP9,999.99.
On 28 September 2020, 16,433,333 warrants were exercised for GBP0.03
each raising total equity of GBP492,999.99.
These GBP0.03 warrants were issued as part of the equity placing in May
of this year.
There have been no other significant events since the balance sheet date
which would require disclosure in or amendment of these interim
financial statements.
(END) Dow Jones Newswires
September 30, 2020 02:00 ET (06:00 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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