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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Wham | LSE:WAM | London | Ordinary Share | GB00B0JG1P02 | ORD 0.1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 41.30 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:6537J Wham Energy plc 29 September 2006 Interim Results for the six months ended 30 June 2006 Operating Highlights *3D seismic survey on blocks 48/3 and 48/4 completed during September, under budget *22nd round licence farmout negotiations nearing completion *23rd round licence yields two quality prospects *24th round licence awards due shortly *New Competent Person's Report due in October 2006 highlighting the quality and breadth of our portfolio, and WHAM's progress since AIM admission *Producing or near-producing asset acquisition opportunities being evaluated Financial Highlights *Interim loss before taxation was #141,920 (2005: #115,324) *Loss per share for the interim period was 0.45p (2005: 0.69p) *Liquid resources at 30 June 2006 amounted to #8.7million, or 27.4p/share Date: 29 September 2006 For further information contact: Wham Energy plc cityPROFILE Tom Windle, Chief Executive Simon Courtenay Tel: 020-7924-4644; Mob: 07968162630 Tel: 020-7448-3244 Alan Thomas, Finance Director Mob: 07739800093 WHAM Energy plc is an AIM listed company. Further details about the company and downloadable copies of this announcement are available on the Company's website: www.whamenergy.com Interim Results for the six months ended 30 June 2006 REVIEW OF OPERATIONS Business environment The oil and gas exploration business environment has changed dramatically over the past eighteen months. On the positive side for the industry, oil and gas prices have been very robust and there is a high demand which, we believe will continue for the foreseeable future. However concomitant with the high commodity prices there has been a dramatic increase in exploration costs. For example rig rates have doubled. The rig hire rate when the Prometheus well was drilled in October 2005 was approximately #55,000 per day; today the rate for new contracts is of the order of #105,000 to #130,000 per day. In addition last year the availability of rigs was reasonable whereas today the majority of the rigs have been contracted, leaving relatively few drilling slots available. The increased industry competitiveness, high costs, and relative scarcity of rigs have adversely impacted our original plans to drill exploration prospects in 2006. We believe that this set back is temporary and by no means diminishes the quality of our portfolio or long term potential. Seismic activity Seismic activity has been confined to the two key licences outlined below. All of the remaining licences are largely covered by quality 3D seismic and as such only subject to internal mapping and seismic attribute analysis to further define and generate new prospects. Blocks 48/3 & 48/4 During September 2006, we conducted a 3D survey over our blocks 48/3 and 48/4. This state of the art 3D programme has ensured that the whole licence is now covered by high quality 3D seismic data, thus ensuring that any exploration well drilled can be placed at the optimum location. The incremental benefits of this survey are enormous; it will not only assist in refining our existing prospects but should also help in identifying new prospects. In addition, in the event of drilling success it will allow the group to fast track any development. The gross acquisition cost of the survey was budgeted at #3 million but was executed for a total cost of #2.58 million, with a net cost of #1.03 million to WHAM. Block 47/12 As announced previously, WHAM planned to shoot a dense 2D seismic programme on 47/12 in June of this year to firm up a potentially attractive gas lead in the northern part of the block. Our plans have been delayed to accommodate environmental and local fishery concerns and it is now anticipated that the survey will commence in February of 2007, subject to final planning consents. Farm-out progress 22nd Round Blocks Our exploration team has undertaken a thorough evaluation of all our 22nd Round blocks which has given us a much better understanding of the prospects and risks. We recognise that this has taken more time than originally anticipated but we believe the effort has yielded a more robust portfolio. At present we are in advanced negotiations with potential farminees for the blocks 48/3 and 48/4 that contain the Morpheus and Nyx prospects and a number of other very attractive prospects and leads. The farm-out will include a commitment to drill a well at the earliest opportunity but probably no earlier than mid 2007. WHAM's cost exposure and equity position are yet to be determined. Southern North Sea N.W. Core blocks 42/25b, 43/16 & 43/25b These blocks have yielded a number of potentially very commercial gas prospects made even more attractive by the fact that the prospects are close to a new development, the Garrow field. WHAM has recently completed a farm-out campaign. We are currently awaiting expressions of interest and offers and believe that we will be in a position to make a firm decision on how best to proceed by mid October. Southern North Sea S.E. Core blocks 49/29c, 50/26c, 53/3e & 53/4c Three of these blocks (49/29c, 50/26c, & 53/4c) have yielded small but potentially very commercial prospects, close to existing infrastructure. WHAM is working closely with Ithaca Energy to investigate how a multi-well drilling programme might be put together to explore the best structures in a cost effective manner. As the target reservoir is very well known and the drilling depths are relatively shallow we believe that there is a reasonable chance that the group will be able to continue the licences and put together an exploration programme to exploit these relatively low risk prospects in conjunction with farminees. In December 2006, some 22nd Round licences with the least attractive prospects will be relinquished. 23rd Round licences Blocks 43/11 and 43/12 This 100% WHAM licence has yielded two well defined prospects at the prospective Carboniferous level directly on trend to the Cavendish field. Currently WHAM is determining the resource potential of the prospects and undertaking further mapping to assess any additional prospectivity on the blocks. 24th Licence Round WHAM participated in the 24th licence round that closed in early June. At present we are awaiting the results which are due to be announced very shortly. In the event of success, WHAM will have additional licences that will strengthen, broaden and add value to our portfolio. Time permitting, for the preparation of a farm-out package WHAM would consider placing any 24th round awards in the industry's Prospect Fair this December. Competent Persons Report (CPR) At the time of our admission to the market we told investors that in addition to the verified prospects we had a number of leads that, when fully evaluated, we would submit for a Competent Persons Report update. These unverified prospects were documented in our 2005 annual report. Thanks to the intensive efforts of our geo-technical team, many of these and several additional prospects have been developed sufficiently to warrant independent verification. WHAM has contracted TRACS International to conduct this verification and the results will be available in mid October. WHAM is confident that this CPR will convincingly demonstrate the breadth and depth of our portfolio, show the considerable value we have added to our asset base over the last year and provide valuable information to investors. In addition we have requested TRACS to provide a continuing service of verification such that we will be able to update shareholders and potential investors on a regular basis in future. Future opportunities Annually the industry holds a Prospect Fair in early December. WHAM has secured a booth at the fair and intends to market blocks 43/11, 43/12 and 47/12 for farm-out. We anticipate there will be significant interest in the blocks and the early marketing coupled with high working interests should allow us to obtain favourable farm-out terms. Whilst still focussing our efforts on exploration opportunities, we are also evaluating the acquisition of near development and producing assets. Should we identify an appropriate asset it would be our intention to make an acquisition to provide the company with early cash-flow to support our operations and enhance our asset base. Industry observers will have seen that recent acquisitions and divestments have achieved record prices, making such acquisitions difficult to achieve. However, we believe that under the right circumstances value-adding asset purchases can still be made which would compliment our existing portfolio. In summary, we now have a well developed exploration prospect inventory and are in the process of negotiating farm-out terms on several prospects. The inventory is shortly to be independently verified, a regulatory process that will allow us to demonstrate to shareholders and investors the value addition achieved through our exploration work during the past year. We will continue to pursue exploration opportunities but at the same time evaluate near developments and producing assets with the potential to provide cash-flow and value addition to the company. We will also evaluate selective international opportunities where the cost base and potential meet our criteria. Licences that we deem to have very low chances of commercial success will not be retained. Tom Windle Chief Executive Officer 29 September 2006 PROFIT AND LOSS ACCOUNT For the six months ended 30 June 2006 6 Months 6 Months Year Ended Ended Ended 30-Jun-06 30-Jun-05 31-Dec-05 Unaudited Unaudited Audited # # # Turnover - 23,598 23,598 Cost of sales - - - -------------------------------------------------------------------------------- Gross profit - 23,598 23,598 Administrative expenses (335,816) (141,239) (395,086) -------------------------------------------------------------------------------- (Loss) on ordinary activities before interest (335,816) (117,641) (371,488) Interest receivable 193,896 2,317 113,313 -------------------------------------------------------------------------------- (Loss) on ordinary activities before taxation (141,920) (115,324) (258,175) Tax on (loss) on ordinary activities - 12,981 41,446 -------------------------------------------------------------------------------- (Loss) for the period after taxation (141,920) (102,343) (216,729) Retained (loss)/ profit brought forward at 1 January 2006 (115,400) 101,329 101,329 -------------------------------------------------------------------------------- Retained (loss) carried forward at 30 June 2006 (257,320) (1,014) (115,400) ================================================================================ Basic and diluted (loss) per share (see note 4) (0.45)p (0.69)p (1.05)p Notes: 1. All of the Company's activities are classed as continuing. 2. There are no recognised gains or losses in either year other than the amounts shown in the profit and loss account. 3. Basis of presentation: These interim financial statements have been prepared on the basis of the accounting policies adopted in the statutory accounts for the year ended 31st December 2005. They were approved by the Directors on 27 September 2006, are unaudited and have not been subject to independent review, as defined in the Auditing Practices Board bulletin 1999/4, and do not constitute full statutory accounts as defined in section 240 of the Companies Act. The comparative financial information for the year ended 31st December 2005 set out in this announcement, which does not constitute the statutory accounts of the Company, is extracted from the Company's audited statutory accounts for the year ended 31st December 2005. The auditors have reported on those accounts and their report was unqualified. 4. Basic and diluted (loss) per share: The basic loss per share has been calculated on the loss on ordinary activities after taxation of #141,920 (6 months to 30 June 2005: #102,343, year to 31 December 2005: #216,729) divided by the weighted average number of ordinary shares in issue during the period of 31,695,611 (6 months to 30 June 2005: 14,873,264, year to 31 December 2005: 20,720,816). As the Company reported a loss for the year then, in accordance with Financial Reporting Standard Number 22, the warrants and options in issue are not considered dilutive. BALANCE SHEET As at 30 June 2006 30-Jun-06 30-Jun-05 31-Dec-05 Unaudited Unaudited Audited # # # Fixed assets Intangible assets 671,441 197,471 518,901 Tangible fixed assets 20,446 6,535 20,344 -------------------------------------------------------------------------------- 691,887 204,006 539,245 -------------------------------------------------------------------------------- Current assets Debtors 166,578 115,157 178,766 Investments (see note) 8,562,495 - 9,130,277 Cash at bank and in hand 127,364 454,690 122,736 -------------------------------------------------------------------------------- 8,856,437 569,847 9,431,779 -------------------------------------------------------------------------------- Creditors Amounts falling due within one year (147,211) (168,214) (427,991) -------------------------------------------------------------------------------- Net current assets 8,709,226 401,633 9,003,788 -------------------------------------------------------------------------------- Total assets less current liabilities 9,401,113 605,639 9,543,033 Provision for liabilities - (12,058) - -------------------------------------------------------------------------------- NET ASSETS 9,401,113 593,581 9,543,033 ================================================================================ Capital and reserves Called-up share capital 31,696 20,564 31,696 Share premium account 9,568,287 515,581 9,568,287 Other reserves 58,450 58,450 58,450 Profit and loss account (257,320) (1,014) (115,400) -------------------------------------------------------------------------------- EQUITY SHAREHOLDERS' FUNDS 9,401,113 593,581 9,543,033 ================================================================================ Note: Investments consisted of money market deposits which earn interest at rates set in advance for periods of 1-2 months by reference to Sterling LIBOR. Cash Flow Statement For the six months ended 30 June 2006 6 Months 6 Months Year Ended Ended Ended 30-Jun-06 30-Jun-05 31-Dec-05 Unaudited Unaudited Audited # # # Net cash inflow/ (outflow) from operating activities (see note) (630,523) (22,930) 9,806 Returns on investment and servicing of finance Bank and investment interest receipts 215,209 2,317 76,322 Taxation Taxation (paid)/ recovered 9,138 - (35,000) Capital expenditure and financial investment -------------------------------------------------------------------------------- Payments to acquire tangible fixed assets (4,438) (2,753) (18,558) Payments to acquire intangible fixed assets (152,540) (182,279) (503,709) -------------------------------------------------------------------------------- (156,978) (185,032) (522,267) -------------------------------------------------------------------------------- Net cash flow before use of liquid resources and financing (563,154) (205,645) (471,139) Management of liquid resources Decrease/(Increase) in short term deposits 567,782 - (9,130,277) Financing -------------------------------------------------------------------------------- Proceeds from issue of ordinary shares - 602,820 10,602,820 Costs associated with share issue - (9,884) (946,067) -------------------------------------------------------------------------------- - 592,936 9,656,753 -------------------------------------------------------------------------------- Increase in cash 4,628 387,291 55,337 ================================================================================ Reconciliation of net cash flow to movement in net funds Increase in cash in the year 4,628 387,291 55,337 Decrease in short term deposits (567,782) - 9,130,277 -------------------------------------------------------------------------------- Change in net funds (563,154) 387,291 9,185,614 Net funds at 1 January 2006 9,253,013 67,399 67,399 -------------------------------------------------------------------------------- Net funds at 30 June 2006 8,689,859 454,690 9,253,013 -------------------------------------------------------------------------------- Note: Reconciliation of operating result to net cash flow from operating activities Operating (loss)/ profit for the year (335,816) (117,641) (371,488) Depreciation 4,336 1,147 3,142 (Increase) in debtors (18,263) (29,108) (35,686) Increase/ (decrease) in creditors (280,780) 122,672 413,838 -------------------------------------------------------------------------------- Net cash inflow/ (outflow) from operating activities (630,523) (22,930) 9,806 -------------------------------------------------------------------------------- This information is provided by RNS The company news service from the London Stock Exchange END IR LPMFTMMBTBIF
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