TIDMBPC
RNS Number : 6929I
BPC Ltd
17 March 2010
17 March 2010
BPC Limited
("BPC" or the "Company")
Preliminary Results for the period ended 31 December2009
Highlights:
· Offshore joint venture signed with Norway's Statoil
· Significant exploration licence area secured with further applications
with JV partner Statoil pending
· Further acquisition and reprocessing of original seismic and well log
data
· Shareholder base strengthened with significant additional institutional
investors added to the register
· Office relocated to Isle of Man with operational and financial function
now under one roof
· Strand Hanson Limited appointed as Nominated Adviser
· Novus Capital Markets Limited and FirstEnergy Capital appointed as joint
Brokers
· A placing of GBP2.4 million to institutional investors post period end to
augment working capital
Alan Burns, Chairman of BPC, commented:
"2009 has been a busy year for the Company, most notably with our joint venture
agreement with Norway's Statoil. BPC's shareholder base has been substantially
strengthened with institutional shareholders as a result of RAB Capital's sale
of a portion of its holding.
"Since the year end, we have raised a further GBP2.4m before expenses from
institutional investors which will be used to fund our ongoing working capital
requirements as we look to realise the significant hydrocarbon potential of the
Bahamas territorial waters."
Enquiries:
+----------------------------------------+--------------------+
| BPC Limited | |
| Alan Burns, Chairman and CEO | Tel: +44 (0)1624 |
| Dr Paul Crevello, Chief Operating | 64 1199 |
| Officer | Tel: +1 720 771 |
| | 7583 |
+----------------------------------------+--------------------+
| Strand Hanson Limited | |
| Rory Murphy / Liam Buswell | Tel: +44 (0)20 |
| | 7409 3494 |
+----------------------------------------+--------------------+
| Novus Capital Markets Ltd | |
| Charles Goodfellow / David Rae | Tel: +44 (0)20 |
| | 7107 1872 |
+----------------------------------------+--------------------+
| FirstEnergy Capital LLP | |
| Richard Hail / Derek Smith | Tel: +44 (0)20 |
| | 7448 0200 |
+----------------------------------------+--------------------+
| Financial Dynamics | |
| Billy Clegg / Ed Westropp | Tel: +44( 0)20 |
| | 7831 3113 |
+----------------------------------------+--------------------+
+----------------------------------------------------------------------------+
| |
+----------------------------------------------------------------------------+
+----------------------------------------------------------------------------+
| Chairman's report |
+----------------------------------------------------------------------------+
2009 has been an important year for our Bahamas project. The project started
out as a concept of mine in 2005, in the belief that there should be substantial
commercial oil and gas deposits in the territorial waters of the Commonwealth of
the Bahamas. To facilitate this major project ,BPC was formed to concentrate
solely on The Commonwealth of The Bahamas. Few realised that the vast southern
expanses of the Bahamas territorial waters contained enormous sedimentary
thicknesses of rocks which contain sound indications of the presence of oil and
gas accumulations. This concept was derived from the supposed location of the
Bahamas in Jurassic times when it lay immediately between West Africa and North
America and was likely to have been a depositional centre. I have been
fortunate enough to have been involved in several major discoveries in a number
of countries by drilling wells where such discoveries resulted in the first
commercial oil discoveries, the most recent of which being Uganda. Uganda is
now a focus of world attention as a major new oil province. I believe that the
Bahamas will not only become the site of major commercial production, but that
the people of the Bahamas will also enjoy significantly greater 'per capita'
benefits than those of Uganda, as a result of the population of the Islands
being only around 300,000 compared with Uganda's 26 million. The social and
infrastructural benefits this will bring in the form of pensions, unemployment
relief, health and education have the potential to be enormous. It is of
further note that the geographical location of the Bahamas, encompassing some of
the world's busiest shipping lanes, makes it well suited to the exportation of
oil to both the North American and world markets.
I would like to draw some parallels with my previous successes. In each case
these projects have been supported by outstanding international technical
expertise and major international financial institutions along with the active
cooperation of the host Government. This also proves to be the case with BPC
Limited. We have a first class team of American geologists and geophysicists
(led by our COO, Dr Paul Crevello), some with direct experience in the Bahamas
and all with major success in geological analogues in other parts of the world,
such as the Middle East and Mexico. We have also enjoyed the support of the
geological departments of the University of Utah, the University of Texas Bureau
of Economic Geology and The University of Miami, Rosenstiel School of Marine and
Atmospheric Science all of which have played an important role in the collation
of our knowledge base.
Upon initiating the project in 2005, it soon became apparent that there were no
data available in the Bahamas. With our technical team we set out to locate all
the data from previous exploration activity in the region dating back as far as
1947 and, with a combination of luck, persistence, senior oil company networking
and many millions of dollars, BPC managed to locate and process the majority of
this lost data using modern technology. These data, if acquired today through
drilling and seismic, would cost well over several hundred million dollars and
therefore form a significant aspect of the asset base of the Company.
Fortuitously, the results of this analysis have provided very strong support of
my original assertions that there is a high probability of major oil and gas
fields in Bahamian waters.
As the year progressed, we were able to assist UK based RAB Capital, our
original co-investor, in distributing the majority of their holding over a
variety of other large UK financial institutions and investors, bringing a
larger shareholder base to the company. This was achieved through our newly
appointed stockbrokers and financial advisers, Novus Capital and Strand Hanson.
Since the accounting reference date of these preliminary results, and thanks to
the efforts of these advisers, we respectively have raised sufficient additional
capital to see us through the next couple of years. I would also like to
announce an important addition to BPC's team of financial advisers with
FirstEnergy Capital. FirstEnergy Capital is considered one of the leading
energy focused investment banks in North America and has recently opened a
London office with a focus on the International oil & gas sector.
Following these recent events, and excluding the team's personal investments in
the Group, our investor base is now comprised of a number of large financial
institutions, primarily based in London. This is important as they provide
increased strength to the Group and provide further foundations for us to
deliver shareholder value.
One of the major recent events was the signing of the Statoil Joint Venture
Agreement and subsequent announcement on 18 May 2009 to collaborate in the
development of a new licence area. The application for the three joint venture
blocks was filed in August 2008 along with payment of all relevant fees. Our
existing blocks are in deeper water and contain giant and super giant leads and
the entire trend is fringed to the south and west by the oil fields of Cuba
The three BPC / Statoil Joint Venture blocks encompass regions of shallow water
in which a well that was drilled by a jack-up rig in 1958 contained over 10,000
feet of oil shows. Seismic surveys were undertaken by Tenneco many years later,
which indicated that the 1958 well was located off the edge of a large
structure. The next stage of the development of this project will be to upgrade
the prospect with new seismic imaging followed by a drilling program anticipated
to take place in 2013. This project has two key advantages; (a) both teams
involved (Statoil and BPC) are highly skilled "oil finders" and (b) any
discovery made, even if relatively small, could be brought into production
relatively more cheaply and quickly than our other large deepwater projects.
BPC's JV partner, Statoil, is recognized as a leader in exploration technology
gained from the North Sea, and their recent partnered-exploration activity in
Cuba confirms the operative petroleum system, which corroborates BPC's
interpretation of the Bahamas study areas.
To date, our total spend dedicated to the projects in the Bahamas has reached
$12.5 million including the cost of acquiring all of the original data and
reprocessing and all associated corporate activities This expenditure has
advanced the projects to a point where large scale Bahamas oil and gas
exploration activities may now take place.
Finally, it may be noted that we have relocated our head office to the Isle of
Man where my co-directors Mike Proffitt and Dursley Stott and I are now based.
To rationalise our corporate structure, we are in the process of reorganising
the Group, which will result in the redomicile of our parent company to the Isle
of Man. This process will have no effect on either the position of our
shareholders or the name of the Group and Company. We expect this process to be
completed in the current year.
My sincerest thanks go to the Bahamian Government, personnel and advisers in the
Bahamas, our shareholders, my co-directors, staff and our technical and
financial advisers for their great support given during the year to this
fascinating project.
Alan Burns
Chairman
BPC Limited
15 March 2010
+------------------------------------------------------------------------------------------+
| BPC Limited |
+------------------------------------------------------------------------------------------+
| 31 December 2009 |
+------------------------------------------------------------------------------------------+
| |
+------------------------------------------------------------------------------------------+
| |
+------------------------------------------------------------------------------------------+
+----------------------------------------+-------+-----+---------------+-----------------+
| Consolidated statement of comprehensive income for the year ended 31 December 2009 |
+----------------------------------------------------------------------------------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | 2009 | 2008 |
| | | | Group | Group |
+----------------------------------------+-------+-----+---------------+-----------------+
| | Note | | $ | $ |
+----------------------------------------+-------+-----+---------------+-----------------+
| Employee benefits expense | | | (924,056) | (1,092,552) |
+----------------------------------------+-------+-----+---------------+-----------------+
| Depreciation and amortisation expense | | | (92,056) | (84,090) |
+----------------------------------------+-------+-----+---------------+-----------------+
| Loss on disposal of property, plant | | | (13,147) | (495) |
| and equipment | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Impairment of goodwill | | | - | (233,351) |
+----------------------------------------+-------+-----+---------------+-----------------+
| Other expenses | | | (1,400,188) | (2,121,839) |
+----------------------------------------+-------+-----+---------------+-----------------+
| Operating loss | | | (2,429,447) | (3,532,327) |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Finance income | | | 4,026 | 57,492 |
+----------------------------------------+-------+-----+---------------+-----------------+
| Finance costs | | | | (86,500) |
| | | | - | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Finance income/(costs) - net | | | 4,026 | (29,008) |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Loss before income tax | | | (2,425,421) | (3,561,335) |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Income tax expense | | | | |
| | | | - | - |
+----------------------------------------+-------+-----+---------------+-----------------+
| Loss for the year | | | (2,425,421) | (3,561,335) |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Other comprehensive income: | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Currency translation differences | | | (231,913) | 130,230 |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Other comprehensive income for the | | | (231,913) | 130,230 |
| year, net of tax | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Total comprehensive income for the | | | (2,657,334) | (3,431,105) |
| year | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Loss per share for loss attributable | | | | |
| to equity holders of the Company: | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| Basic and diluted earnings per share | 2 | | (0.31) | (0.49) |
| (expressed in Cents per share) | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+-----------------+
+----------------------------------------------------------------------------+
| BPC Limited |
+----------------------------------------------------------------------------+
| 31 December 2009 |
+----------------------------------------------------------------------------+
| |
+----------------------------------------------------------------------------+
+----------------------------------------+-------+-----+---------------+----------------+
| Consolidated balance sheet as at 31 December 2009 |
+---------------------------------------------------------------------------------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | 2009 | 2008 |
| | | | Group | Group |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | $ | $ |
+----------------------------------------+-------+-----+---------------+----------------+
| ASSETS | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Non-current assets | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Cash not available for use | | | 119,555 | 1,204,616 |
+----------------------------------------+-------+-----+---------------+----------------+
| Property, plant and equipment | | | 18,706 | 117,277 |
+----------------------------------------+-------+-----+---------------+----------------+
| Exploration and evaluation assets | | | 4,063,824 | 4,055,587 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | 4,202,085 | 5,377,480 |
+----------------------------------------+-------+-----+---------------+----------------+
| Current assets | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Cash and cash equivalents | | | 1,337,885 | 3,004,451 |
+----------------------------------------+-------+-----+---------------+----------------+
| Trade and other receivables | | | 469,677 | 507,393 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | 1,807,562 | 3,511,844 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Total assets | | | 6,009,647 | 8,889,324 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| LIABILITIES | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Current liabilities | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Trade and other payables | | | 271,817 | 541,382 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Total liabilities | | | 271,817 | 541,382 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| EQUITY | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Ordinary Shares | | | 28,764 | 28,764 |
+----------------------------------------+-------+-----+---------------+----------------+
| Share premium reserve | | | 73,634,186 | 73,634,186 |
+----------------------------------------+-------+-----+---------------+----------------+
| Reverse acquisition reserve | | | (53,846,526) | (53,846,526) |
+----------------------------------------+-------+-----+---------------+----------------+
| Share based payments reserve | | | 347,361 | 300,139 |
+----------------------------------------+-------+-----+---------------+----------------+
| Other reserves | | | (106,615) | 125,298 |
+----------------------------------------+-------+-----+---------------+----------------+
| Retained earnings | | | (14,319,340) | (11,893,919) |
+----------------------------------------+-------+-----+---------------+----------------+
| Total equity | | | 5,737,830 | 8,347,942 |
+----------------------------------------+-------+-----+---------------+----------------+
| | | | | |
+----------------------------------------+-------+-----+---------------+----------------+
| Total equity and liabilities | | | 6,009,647 | 8,889,324 |
+----------------------------------------+-------+-----+---------------+----------------+
+------------------------------------------------------------------------------------------+
| BPC Limited |
+------------------------------------------------------------------------------------------+
| 31 December 2009 |
+------------------------------------------------------------------------------------------+
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Consolidated statement of changes | | | | | |
| in equity | | | | | |
| | | | | | |
+------------------------------------------------------------+--------------+--------------+-----------+--------------+--------------+
| | | Share | Share | Reverse | Share | Other | Retained | Total |
| | | capital | premium | Acquisition | based | reserves | earnings | equity |
| | | | | Reserve | payments | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | $ | $ | $ | $ | $ | $ | $ |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Balance | | 1,118,700 | 11,871,197 | | 253,799 | (4,932) | (8,332,584) | 4,906,180 |
| at 1 | | | | | | | | |
| January | | | | | | | | |
| 2008 | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Total | | | | | | 130,230 | (3,561,335) | (3,431,105) |
| comprehensive | | - | - | | - | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Employee | | - | - | | 28,126 | - | - | 28,126 |
| share | | | | | | | | |
| option | | | | | | | | |
| scheme: | | | | | | | | |
| value of | | | | | | | | |
| employee | | | | | | | | |
| services | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Options | | 66,950 | 702,550 | | | | | 769,500 |
| exercised | | | | | - | - | - | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | 1,185,650 | 12,573,747 | | 281,925 | 125,298 | (11,893,919) | 2,272,701 |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| BPC | | | | | | | | |
| Limited | | | | | | | | |
| (formerly | | | | | | | | |
| FGML) | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Balance | | - | - | - | 281,925 | 125,298 | (8,332,584) | (7,925,361) |
| at 1 | | | | | | | | |
| January | | | | | | | | |
| 2008 | | | | | | | | |
| arising | | | | | | | | |
| in | | | | | | | | |
| legacy | | | | | | | | |
| BPC | | | | | | | | |
| Jersey | | | | | | | | |
| Limited | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Total | | - | - | - | - | - | (3,561,335) | (3,561,335) |
| comprehensive | | | | | | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Shares | | 2,850 | 18,594,187 | | - | - | - | 18,597,037 |
| prior | | | | | | | | |
| to | | | | | | | | |
| acquisition | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Issue | | 25,914 | 55,039,999 | (53,846,526) | - | | | 1,219,387 |
| of | | | | | | - | - | |
| share | | | | | | | | |
| capital | | | | | | | | |
| on | | | | | | | | |
| business | | | | | | | | |
| combination | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Share | | | | | 18,214 | | | 18,214 |
| options | | | - | - | | - | - | |
| - value | | | | | | | | |
| of | | | | | | | | |
| services | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Balance | | 28,764 | 73,634,186 | (53,846,526) | 300,139 | 125,298 | (11,893,919) | 8,347,942 |
| at 31 | | | | | | | | |
| December | | | | | | | | |
| 2008 | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Balance | | 28,764 | 73,634,186 | (53,846,526) | 300,139 | 125,298 | (11,893,919) | 8,347,942 |
| at 1 | | | | | | | | |
| January | | | | | | | | |
| 2009 | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Total | | - | - | - | - | (231,913) | (2,425,421) | (2,657,334) |
| comprehensive | | | | | | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Share | | | | | 47,222 | | | 47,222 |
| options | | | - | - | | - | - | |
| - value | | | | | | | | |
| of | | | | | | | | |
| services | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| Balance | | 28,764 | 73,634,186 | (53,846,526) | 347,361 | (106,615) | (14,319,340) | 5,737,830 |
| at 31 | | | | | | | | |
| December | | | | | | | | |
| 2009 | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
| | | | | | | | | |
+---------------+--------+-----------------+-----------------+--------------+--------------+-----------+--------------+--------------+
+----------------------------------------------------------------------------+
| BPC Limited |
+----------------------------------------------------------------------------+
| 31 December 2009 |
+----------------------------------------------------------------------------+
| |
+----------------------------------------------------------------------------+
+----------------------------------------+-----+---------------+----------------+
| Consolidated cash flow statement for the year ended 31 December 2009 |
+-------------------------------------------------------------------------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| | | 2009 | 2008 |
| | | Group | Group |
+----------------------------------------+-----+---------------+----------------+
| | | $ | $ |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Cash flows from operating activities | | | |
+----------------------------------------+-----+---------------+----------------+
| Payments to suppliers and employees | | (2,823,096) | (2,930,809) |
+----------------------------------------+-----+---------------+----------------+
| Net cash used in operating activities | | (2,823,096) | (2,930,809) |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Cash flows from investing activities | | | |
+----------------------------------------+-----+---------------+----------------+
| Purchase of property, plant and | | - | (12,921) |
| equipment | | | |
+----------------------------------------+-----+---------------+----------------+
| Proceeds from sale of property, plant | | 4,619 | 2,076 |
| and equipment | | | |
+----------------------------------------+-----+---------------+----------------+
| Payments for exploration and | | (8,237) | (870,408) |
| evaluation assets | | | |
+----------------------------------------+-----+---------------+----------------+
| Deposit repayments/(payments) for bank | | 1,085,061 | (101,142) |
| guarantees | | | |
+----------------------------------------+-----+---------------+----------------+
| Interest received | | 4,026 | 57,492 |
+----------------------------------------+-----+---------------+----------------+
| Net cash generated by /(used in) | | 1,085,469 | (924,903) |
| investing activities | | | |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Cash flows from financing activities | | | |
+----------------------------------------+-----+---------------+----------------+
| Proceeds from issuance of ordinary | | - | 6,826,527 |
| shares | | | |
+----------------------------------------+-----+---------------+----------------+
| Interest paid | | | (86,500) |
| | | - | |
+----------------------------------------+-----+---------------+----------------+
| Net cash generated from financing | | | 6,740,027 |
| activities | | - | |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Net (decrease)/ increase in cash and | | (1,737,627) | 2,884,315 |
| cash equivalents | | | |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Cash and cash equivalents at the | | 3,004,451 | 675,711 |
| beginning of the year | | | |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Effects of exchange rate changes on | | 71,031 | (555,575) |
| cash and cash equivalents | | | |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
| Cash and cash equivalents at end of | | 1,337,855 | 3,004,451 |
| year | | | |
+----------------------------------------+-----+---------------+----------------+
| | | | |
+----------------------------------------+-----+---------------+----------------+
+----------------------------------------------------------------------------+
| 1 Summary of significant accounting policies |
+----------------------------------------------------------------------------+
| The principal accounting policies applied in the preparation of these |
| consolidated financial statements are set out below. These policies have |
| been consistently applied to all the years presented, unless otherwise |
| stated. |
+----------------------------------------------------------------------------+
| 1.1 Basis of preparation |
+----------------------------------------------------------------------------+
| The consolidated financial statements of BPC Limited reflect the results |
| and financial position of the Group for the 12 month period to 31 December |
| 2009. |
+----------------------------------------------------------------------------+
| These financial statements of BPC Limited have been prepared in accordance |
| with International Financial Reporting Standards as adopted by the |
| European Union (IFRS) and have been prepared under the historical cost |
| convention. |
| On 1 September 2008, BPC Jersey Limited became the acquirer of Falkland |
| Gold and Minerals Limited ("FGML"), although FGML is the legal parent of |
| the combined group. As BPC Jersey Limited is the acquirer, the |
| consolidated accounts for 2008 show the results of the BPC Group |
| incorporating FGML's results from 1 September 2008. |
| The preparation of financial statements in conformity with IFRS requires |
| the use of certain critical accounting estimates. It also requires |
| management to exercise its judgment in the process of applying the Group's |
| accounting policies. |
| Going concern |
| These financial statements have been prepared on a going concern basis, |
| which assumes that the Group will be able to meet its liabilities as and |
| when they fall due for the foreseeable future. |
| On 11 March 2010 the Company announced the successful placing of |
| 69,842,860 ordinary shares raising gross funds of GBP2.4 million. |
| The Directors have prepared cash flow forecasts that indicate that the |
| Group will be able to meet its financial obligations through to the end of |
| 2011 from its existing liquid cash resources. |
| Additional cash resources may become available to the Group following the |
| granting of three new exploration licences in the Bahamas resulting in the |
| completion of the farm in agreement with Statoil and receipt of |
| consideration funds thereof. |
| However, the Group's ability to meet its obligations beyond 2011 is |
| dependent on either further fund raising, completion of the Statoil farm |
| in agreement or the agreement of further farm in arrangements of the |
| Group's licences. |
| a) Standards, amendments and interpretations which became effective in |
| 2009 |
| |
| * IFRS 7 'Financial instruments - Disclosures' (amendment) - effective 1 |
| January 2009. The amendment requires enhanced disclosures about fair |
| value measurement and liquidity risk. In particular, the amendment |
| requires disclosure of fair value measurements by level of a fair value |
| measurement hierarchy. As the change in accounting policy only results in |
| additional disclosures, there is no impact on earnings per share. |
| * IAS 1 (revised), 'Presentation of financial statements' - effective 1 |
| January 2009. The revised standard prohibits the presentation of items of |
| income and expenses (that is, 'non-owner changes in equity') in the |
| statement of changes in equity, requiring 'non-owner changes in equity' to |
| be presented separately from owner changes in equity in a statement of |
| comprehensive income. As a result the Group presents in the consolidated |
| statement of changes in equity all owner changes in equity, whereas all |
| non-owner changes in equity are presented in the consolidated statement of |
| comprehensive income. Comparative information has been re-presented so |
| that it also is in conformity with the revised standard. As the change in |
| accounting policy only impacts on presentational aspects, there is no |
| impact on earnings per share. |
| * IFRS 2 (amendment), 'Share-based payment' (effective 1 January 2009) |
| deals with vesting conditions and cancellations. It clarifies that |
| vesting conditions are service conditions and performance conditions only. |
| Other features of share-based payment are not vesting conditions. These |
| features would need to be included in the grant date fair value for |
| transactions with employees and others providing similar services; they |
| would not impact the number of awards expected to vest or valuation |
| thereof subsequent to grant date. All cancellations, whether by the |
| entity or other parties, should receive the same accounting treatment. |
| The Group has adopted IFRS 2 (amendment) from 1 January 2009. The |
| amendment does not have a material impact on the Group's financial |
| statements. |
| * IFRS 8 'Operating Segments' - effective 1 January 2009. This standard |
| replaces IAS 14, 'Segment reporting'. It requires a 'management approach' |
| under which segment information is presented on the same basis as that |
| used for internal reporting purposes. Operating segments are required to |
| be reported in a manner consistent with the internal reporting provided to |
| the chief operating decision maker. The chief operating decision maker |
| has been identified as the Chief Operating Officer ("CEO") and Chairman. |
| There is no longer a requirement to make disclosure based on primary and |
| secondary reporting formats, nor is there a requirement to distinguish |
| between business and geographical segments. |
| Despite these changes application of the new standard has not |
| significantly impacted the way management reports segmental information. |
| Management believe that under the new standard the Group should continue |
| as one segment as this is the basis on which the Group is organised and |
| managed. The Group operates one segment which is it's oil and gas |
| exploration activities in the Bahamas and therefore the segment disclosed |
| has not changed as a result of adoption of IFRS 8. |
| |
+----------------------------------------------------------------------------+
| |
+----------------------------------------------------------------------------+
+------------------------------------------+----------------------------------+
| b) Standards, amendments and interpretations to existing standards that are |
| not yet effective and have not been early adopted by the Group |
| |
| The following standards, amendments and interpretations to existing |
| standards have been published and are mandatory for the Group's accounting |
| periods beginning on or after 1 January 2010 or later periods, but the |
| Group has not early adopted them; |
| |
| * IFRIC 17, 'Distribution of non-cash assets to owners' (effective on or |
| after 1 July 2009). The interpretation is part of the IASB's annual |
| improvements project published in April 2009. This interpretation provides |
| guidance on accounting for arrangements whereby an entity distributes |
| no-cash assets to shareholders either as a distribution of reserves or as |
| dividends. IFRS 5 has also been amended to require that assets are |
| classified as held for distribution only when they are available for |
| distribution in their present condition and distribution is highly |
| probable. The Group will apply IFRIC 17 from 1 January 2010. It is not |
| expected to have a material impact on the Group's financial statements. |
| * IAS 27 (revised), 'Consolidated and separate financial statements', |
| (effective from 1 July 2009). The revised standard requires the effects of |
| all transactions with non-controlling interests to be recorded in equity if |
| there is no change in control and these transactions will no longer result |
| in goodwill or gains and losses. The standard also specifies the |
| accounting when control is lost. Any remaining interest in the entity is |
| remeasured to fair value, and a gain or loss is recognised in profit or |
| loss. The Group will apply IAS 27 (revised) prospectively to transactions |
| with non-controlling interests from 1 January 2010. |
| * IFRS 3 (revised), 'Business combinations' (effective from 1 July 2009). |
| The revised standard continues to apply the acquisition method to business |
| combinations, with some significant changes. For example, all payments to |
| purchase a business are to be recorded at fair value at the acquisition |
| date, with contingient payments classified as debt subsequently re-measured |
| through the income statement. There is a choice on an |
| acquisition-by-acquisition basis to measure the non-controlling interest in |
| the acquiree at fair value or at the non-controlling interest's |
| proportionate share of the acquiree's net assets. All acquisition related |
| costs should be expensed. The Group will apply IFRS 3 (revised) |
| prospectively to all business combinations from 1 January 2010. |
| * IAS 38 (amendment), 'Intangible Assets'. The amendment is part of the |
| IASB's annual improvements project published in April 2009 and the Group |
| will apply IAS 38 (amendment) from the date IFRS 3 (revised) is adopted. |
| The amendment clarifies guidance in measuring fair value of an intangible |
| asset acquired in a business combination and it permits the grouping of |
| intangible assets as a single asset if each asset has similar useful |
| economic lives. The amendment will not result in a material impact on the |
| Group's financial statements. |
| * IFRS 5 (amendment), 'Measurement of non-current assets (or disposal |
| groups) classified as held-for-sale'. The amendment is part of the IASB's |
| annual improvements project published in April 2009. The amendment provides |
| clarification that IFRS 5 specifies the disclosures required in respect of |
| non-current assets (or disposal groups) classified as held for sale or |
| discontinued operations. It also clarifies that the general requirement of |
| IAS 1 still apply, particularly paragraph 15 (to achieve a fair |
| presentation) and paragraph 125 (sources of estimation uncertainty) of IAS |
| 1. The Group will apply IFRS 15 (amendment) from 1 January 2010. It is not |
| expected to have a material impact on the Group's financial statements. |
| * IAS 1 (amendment), 'Presentation of financial statements'. The amendment |
| is part of the IASB's annual improvement project published in April 2009. |
| The amendment provides clarification that the potential settlement of a |
| liability by the issue of equity is not relevant to its classification as |
| current or non-current. By amending the definition of current liability, |
| the amendment permits a liability to be classified as non-current (provided |
| that the entity has an unconditional right to defer settlement by transfer |
| of cash or other assets for at least 12 months after the accounting period) |
| notwithstanding the fact that the entity could be required by the |
| counterparty to settle in shares at any time. The Group will apply IAS 1 |
| (amendment) from 1 January 2010. It is not expected to have a material |
| impact on the Group's financial statements. |
| * IFRS 2 (amendments), 'Group cash-settled and share-based payment |
| transactions'. In addition to incorporating IFRIC 8, 'Scope of IFRS 2', and |
| IFRIC 11, 'IFRS 2-Group and treasury share transactions', the amendments |
| expand on the guidance in IFRIC 11 to address the classification of group |
| arrangements that were not covered by that interpretation. The new guidance |
| is not expected to have a material impact on the Group's financial |
| statements. |
| . |
| |
+-----------------------------------------------------------------------------+
| 1.2Basis of consolidation |
+-----------------------------------------------------------------------------+
| The consolidated financial statements incorporate the financial statements |
| of the Company and entities (including special purpose entities) controlled |
| by the Company (its subsidiaries) made up to 31 December each year. |
| Control is achieved where the Company has the power to govern the financial |
| and operating policies of an investee entity so as to obtain benefits from |
| its activities. |
| The results of subsidiaries acquired or disposed of during the year are |
| included in the consolidated income statement from the effective date of |
| acquisition or up to the effective date of disposal, as appropriate. |
| Where necessary, adjustments are made to the financial statements of |
| subsidiaries to bring the accounting policies used in line with those used |
| by the Group. |
| All intra-group transactions, balances, income and expenses (including |
| unrealised gains and losses on transactions between group companies) are |
| eliminated on consolidation. |
| Changes in the Group's interest in a subsidiary that do not result in a |
| loss of control are accounted for as equity transactions. Any difference |
| between the amount by which the non-controlling interests are adjusted and |
| the fair value of the consideration paid or received is recognised directly |
| in equity and attributed to the Group. |
| |
+-----------------------------------------------------------------------------+
| 1.3Business combinations |
+-----------------------------------------------------------------------------+
| Acquisitions of subsidiaries and businesses are accounted for using the |
| purchase method. |
| The cost of the acquisition is measured at the aggregate of the fair |
| values, at the date of exchange, of assets given, liabilities incurred or |
| assumed, and equity instruments issued by the Group plus |
| acquisition-related costs in exchange for control of the acquiree. |
| Under IFRS 3, the directors must identify the "acquirer" and the "acquiree" |
| under any business combination. The acquirer is the combining entity that |
| obtains control of the other combining entity. Control is the power to |
| govern the financial and operating policies of an entity so as to obtain |
| benefits from its activities. In assessing whether a combining entity has |
| obtained control of another combining entity the following are considered: |
| · acquisition of more than one-half of the other entity's voting |
| rights; or |
| · power to govern the financial and operating policies of the other |
| entity under a statute or agreement; or |
| · power to appoint or remove the majority of the members of the board |
| of directors of the other entity; or |
| · power to cast the majority of votes at meetings of the board of |
| directors of the other entity. |
| Other indications that assist with identifying the acquirer are: |
| · if the fair value of one of the combining entities is significantly |
| greater than that of the other combining entity, the entity with the |
| greater fair value is likely to be the acquirer; |
| · if the business combination is effected through an exchange of |
| voting ordinary equity instruments for cash or other assets, the entity |
| giving up cash or other assets is likely to be the acquirer; and |
| · if the business combination results in the management of one of the |
| combining entities being able to dominate the selection of the management |
| team of the resulting combined entity, the entity whose management is able |
| so to dominate is likely to be the acquirer. |
| Where appropriate, the cost of acquisition includes any asset or liability |
| resulting from a contingent consideration arrangement, measured at its |
| acquisition-date fair value. Subsequent changes in such fair values are |
| adjusted against the cost of acquisition where they qualify as measurement |
| period adjustments (see below). All other subsequent changes in the fair |
| value of contingent consideration classified as an asset or liability are |
| accounted for in accordance with relevant IFRSs. Changes in the fair value |
| of contingent consideration classified as equity are not recognised. |
| The acquiree's identifiable assets, liabilities and contingent liabilities |
| that meet the conditions for recognition under IFRS 3 are recognised at |
| their fair value at the acquisition date, except that: |
| * deferred tax assets or liabilities and liabilities or assets related to |
| employment benefit arrangements are recognised and measured in accordance |
| with IAS 12 Income Taxes and IAS 19 Employment Benefits respectively; and |
| * liabilities or equity instruments related to the replacement by the Group |
| of an acquiree's share-based payment awards are measured in accordance with |
| IFRS 2 Share-based Payment; and |
| * assets (or disposal groups) that are classified as held for sale in |
| accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued |
| Operations are measured in accordance with that standard. |
| If the initial accounting for a business combination is incomplete by the |
| end of the reporting period in which the combination occurs, the Group |
| reports provisional amounts for the items for which the accounting is |
| incomplete. Those provisional amounts are adjusted during the measurement |
| period (see below), or additional assets or liabilities are recognised, to |
| reflect new information obtained about facts and circumstances that existed |
| as of the acquisition date that, if known, would have affected the amounts |
| recognised as of that date. |
| The measurement period is the period from the date of acquisition to the |
| date the Group receives complete information about facts and circumstances |
| that existed as of the acquisition date - and is subject to a maximum of |
| one year. |
| |
+-----------------------------------------------------------------------------+
| 1.4 Goodwill |
+-----------------------------------------------------------------------------+
| Goodwill arising on the acquisition of a subsidiary is recognised as an |
| asset at the date that control is acquired (the acquisition date). |
| Goodwill is measured as the excess of the sum of the consideration |
| transferred, the amount of any non-controlling interest in the acquiree and |
| the fair value of the acquirer's previously-held equity interest (if any) |
| in the entity over the net fair value of the identifiable net assets |
| recognised. |
| If, after reassessment, the Group's interest in the net fair value of the |
| acquiree's identifiable net assets exceeds the sum of the consideration |
| transferred, the amount of any non-controlling interest in the acquiree and |
| the fair value of the acquirer's previously-held equity interest (if any), |
| the excess is recognised immediately in profit or loss as a bargain |
| purchase gain. |
| Goodwill is not amortised, but is reviewed for impairment at least |
| annually. Any impairment loss is recognised immediately in profit or loss |
| and is not subsequently reversed. |
| On disposal of a subsidiary, the attributable amount of goodwill is |
| included in the determination of the profit or loss on disposal. |
+-----------------------------------------------------------------------------+
| 1.5 Segment reporting |
+-----------------------------------------------------------------------------+
| All of the Group's business activities relate to oil and gas exploration |
| activities in the Bahamas. Therefore the business is managed by the chief |
| operating decision maker ("CODM"), who has been identified as the Chief |
| Exectutive Officer ("the CEO") and Chairman as one business segment. The |
| CODM receives reports at a consolidated level and uses those reports to |
| assess business performance. It is not possible to assess performance |
| properly using the financial information collected at the subsidiary level. |
| |
+-----------------------------------------------------------------------------+
| 1.6Foreign currency translation |
+-----------------------------------------------------------------------------+
| (i) Functional and presentation currency |
+-----------------------------------------------------------------------------+
| Items included in the financial statements of each of the Group's entities |
| are measured using the currency of the primary economic environment in |
| which the entity operates ('the functional currency'). The consolidated |
| financial statements are presented in United States Dollars, which is BPC |
| Limited's functional and presentation currency. |
+-----------------------------------------------------------------------------+
| (ii) Transactions and balances |
+-----------------------------------------------------------------------------+
| Foreign currency transactions are translated into the functional currency |
| using the exchange rates prevailing at the dates of the transactions. |
| Foreign exchange gains and losses resulting from the settlement of such |
| transactions and from the translation at year end exchange rates of |
| monetary assets and liabilities denominated in foreign currencies are |
| recognised in the income statement, except when they are deferred in equity |
| as qualifying cash flow hedges and qualifying net investment hedges. |
| Foreign exchange gains and losses that relate to borrowings and cash and |
| cash equivalents are presented in the statement of comprehensive income |
| within 'finance income or cost'. All other foreign exchange gains and |
| losses are presented in the statement of comprehensive income within "other |
| expenses". |
+-----------------------------------------------------------------------------+
| (iii) Group companies |
+-----------------------------------------------------------------------------+
| The results and financial position of all the group entities (none of which |
| has the currency of a hyperinflationary economy) that have a functional |
| currency different from the presentation currency are translated into the |
| presentation currency as follows: |
| * assets and liabilities for each balance sheet presented are translated at |
| the closing rate at the date of that balance sheet; |
| * income and expenses for each income statement are translated at average |
| exchange rates (unless this is not a reasonable approximation of the |
| cumulative effect of the rates prevailing on the transaction dates, in |
| which case income and expenses are translated at the dates of the |
| transactions); and |
| * all resulting exchange differences are recognised as a separate component |
| of equity. |
+-----------------------------------------------------------------------------+
| On consolidation, exchange differences arising from the translation of any |
| net investment in foreign entities, and of borrowings and other currency |
| instruments designated as hedges of such investments, are taken to |
| shareholders' equity. When a foreign operation is partially disposed of or |
| sold exchange differences are recognised in the income statement as part of |
| the gain or loss on sale. |
+-----------------------------------------------------------------------------+
| Goodwill and fair value adjustments arising on the acquisition of a foreign |
| entity are treated as assets and liabilities of the foreign entities and |
| translated at the closing rate. |
| |
+-----------------------------------------------------------------------------+
| 1.7 Investments |
+-----------------------------------------------------------------------------+
| Investments are stated at cost less provision for any permanent diminution |
| in value. |
| |
+-----------------------------------------------------------------------------+
| 1.8 Property, plant and equipment |
+-----------------------------------------------------------------------------+
| Property, plant and equipment is stated at historical cost less |
| depreciation. Historical cost includes expenditure that is directly |
| attributable to the acquisition of the items. |
+-----------------------------------------------------------------------------+
| Subsequent costs are included in the asset's carrying amount or recognised |
| as a separate asset, as appropriate, only when it is probable that future |
| economic benefits associated with the item will flow to the Group and the |
| cost of the item can be measured reliably. The carrying amount of the |
| replaced part is derecognised. All other repairs and maintenance are |
| charged to the income statement during the reporting period in which they |
| are incurred. |
+-----------------------------------------------------------------------------+
| Depreciation on assets is calculated using the straight-line method to |
| allocate their cost or revalued amounts, net of their residual values, |
| over their estimated useful lives, as follows: |
+-----------------------------------------------------------------------------+
| - Computer hardware | 3 years |
+------------------------------------------+----------------------------------+
| - Computer software | 3 years |
+------------------------------------------+----------------------------------+
| - Furniture, fittings and equipment | 4 years |
+------------------------------------------+----------------------------------+
| - Leasehold improvements | Over the life of the lease |
+------------------------------------------+----------------------------------+
| The assets' residual values and useful lives are reviewed, and adjusted if |
| appropriate, at each balance sheet date. |
+-----------------------------------------------------------------------------+
| An asset's carrying amount is written down immediately to its recoverable |
| amount if the asset's carrying amount is greater than its estimated |
| recoverable amount. |
+-----------------------------------------------------------------------------+
| Gains and losses on disposals are determined by comparing proceeds with |
| carrying amount and are recognised within 'Loss on disposal of fixed |
| assets' in the statement of comprehensive income. |
+------------------------------------------+----------------------------------+
+----------------------------------------------------------------------------+
| 1.9 Impairment of assets |
+----------------------------------------------------------------------------+
| Goodwill and tangible assets that have an indefinite useful life are not |
| subject to amortisation and are tested annually for impairment or more |
| frequently if events or changes in circumstances indicate that they might |
| be impaired. Assets that are subject to amortisation are reviewed for |
| impairment whenever events or changes in circumstances indicate that the |
| carrying amount may not be recoverable. An impairment loss is recognised |
| for the amount by which the asset's carrying value exceeds its recoverable |
| amount. The recoverable amount is the higher of an asset's fair value |
| less costs to sell and value in use. For the purposes of assessing |
| impairment, assets are grouped at the lowest levels for which there are |
| separately identifiable cash inflows which are largely independent of the |
| cash inflows from other assets or groups of assets (cash-generating |
| units). Non-financial assets other than goodwill that suffered an |
| impairment are reviewed for possible reversal of the impairment at each |
| reporting date. |
| |
+----------------------------------------------------------------------------+
| 1.10 Exploration and evaluation assets |
+----------------------------------------------------------------------------+
| Exploration and evaluation expenditure incurred which relates to more than |
| one area of interest is allocated across the various areas of interest to |
| which it relates on an equal proportions basis. Exploration and |
| evaluation expenditure incurred by or on behalf of the Group is |
| accumulated separately for each area of interest. The area of interest |
| adopted by the Group is defined as a petroleum title. |
+----------------------------------------------------------------------------+
| Expenditure in the area of interest comprises net direct costs and an |
| appropriate portion of related overhead expenditure, but does not include |
| the general overheads or administrative expenditure not having a specific |
| nexus with a particular area of interest. |
+----------------------------------------------------------------------------+
| Exploration expenditure for each area of interest, other than that |
| acquired from the purchase of another entity, is carried forward as an |
| asset provided that one of the following conditions is met: |
| * The costs are expected to be recouped through successful development and |
| exploitation of the area of interest, or alternatively by its sale; and |
| * Exploration and/or evaluation activities in the area of interest have |
| not, at the reporting date, reached a stage which permits a reasonable |
| assessment of the existence or otherwise of economically recoverable |
| reserves, and active and significant operations in, or in relation to, the |
| area of interest are continuing. |
+----------------------------------------------------------------------------+
| Exploration expenditure which fails to meet at least one of the conditions |
| outlined above is written off. Costs incurred in drilling exploration |
| wells that fail to encounter significant hydrocarbons are written off in |
| the year incurred. |
+----------------------------------------------------------------------------+
| Exploration assets acquired are reassessed on a regular basis and these |
| costs are carried forward provided that at least one of the conditions |
| outlined above is met. |
+----------------------------------------------------------------------------+
| Expenditure is not carried forward in respect of any area of interest |
| unless the Group's right of tenure to that area of interest is current. |
| |
+----------------------------------------------------------------------------+
| 1.11 Financial assets |
+----------------------------------------------------------------------------+
| Other receivables |
+----------------------------------------------------------------------------+
| Other receivables are non-derivative financial assets with fixed or |
| determinable payments that are not quoted in an active market. They are |
| included in current assets, except for those with maturities greater than |
| 12 months after the balance sheet date which are classified as non-current |
| assets. Other receivables are included in the balance sheet. |
| |
+----------------------------------------------------------------------------+
| 1.12 Cash and cash equivalents |
+----------------------------------------------------------------------------+
| For cash flow statement presentation purposes, cash and cash equivalents |
| includes cash on hand, deposits held at call with financial institutions, |
| other short-term, highly liquid investments with original maturities of |
| three months or less that are readily convertible to known amounts of cash |
| and which are subject to an insignificant risk of changes in value, and |
| bank overdrafts. Bank overdrafts, where applicable, are shown within |
| borrowings in current liabilities on the balance sheet. |
| |
+----------------------------------------------------------------------------+
| 1.13 Share capital |
+----------------------------------------------------------------------------+
| Ordinary shares are classified as equity. Incremental costs directly |
| attributable to the issue of new shares or options are shown in equity as |
| a deduction, net of tax, from the proceeds. |
| |
+----------------------------------------------------------------------------+
| 1.14 Trade and other payables |
+----------------------------------------------------------------------------+
| These amounts represent liabilities for goods and services provided to the |
| Group prior to the end of financial year which are unpaid. The amounts |
| are unsecured and are usually paid within 30 days of recognition. Trade |
| payables are recognised initially at fair value and subsequently measured |
| at amortised cost using the effective interest method. |
| |
+----------------------------------------------------------------------------+
| 1.15 Borrowings |
+----------------------------------------------------------------------------+
| Borrowings are initially recognised at fair value, net of transaction |
| costs incurred. Borrowings are subsequently measured at amortised cost. |
| Any difference between the proceeds (net of transaction costs) and the |
| redemption amount is recognised in the income statement over the period of |
| the borrowings using the effective interest method. Fees paid on the |
| establishment of loan facilities, which are not an incremental cost |
| relating to the actual draw-down of the facility, are recognised as |
| prepayments and amortised on a straight-line basis over the term of the |
| facility. |
| Borrowings are removed from the balance sheet when the obligation |
| specified in the contract is discharged, cancelled or expired. The |
| difference between the carrying amount of a financial liability that has |
| been extinguished or transferred to another party and the consideration |
| paid, including any non-cash assets transferred or liabilities assumed, is |
| recognised in other income or other expenses. |
| Borrowings are classified as current liabilities unless the Group has an |
| unconditional right to defer settlement of the liability for at least 12 |
| months after the reporting date. |
| |
+----------------------------------------------------------------------------+
| 1.16 Borrowing costs |
+----------------------------------------------------------------------------+
| Borrowing costs incurred for the construction of any qualifying asset are |
| capitalised during the period of time that is required to complete and |
| prepare the asset for its intended use or sale. Other borrowing costs are |
| expensed. |
| |
+----------------------------------------------------------------------------+
| 1.17 Deferred income tax |
+----------------------------------------------------------------------------+
| Deferred income tax is provided in full, using the liability method, on |
| temporary differences arising between the tax bases of assets and |
| liabilities and their carrying amounts in the consolidated financial |
| statements. However, the deferred income tax is not accounted for if it |
| arises from initial recognition of an asset or liability in a transaction |
| other than a business combination that at the time of the transaction |
| affects neither accounting nor taxable profit or loss. Deferred income |
| tax is determined using tax rates (and laws) that have been enacted or |
| substantially enacted by the balance sheet date and are expected to apply |
| when the related deferred income tax asset is realised or the deferred |
| income tax liability is settled. |
+----------------------------------------------------------------------------+
| Deferred tax assets are recognised for deductible temporary differences |
| and unused tax losses only if it is probable that future taxable amounts |
| will be available to utilise those temporary differences and losses. |
+----------------------------------------------------------------------------+
| Deferred tax liabilities and assets are not recognised for temporary |
| differences between the carrying amount and tax bases of investments in |
| controlled entities where the parent entity is able to control the timing |
| of the reversal of the temporary differences and it is probable that the |
| differences will not reverse in the foreseeable future. |
+----------------------------------------------------------------------------+
| Deferred tax assets and liabilities are offset when there is a legally |
| enforceable right to offset current tax assets and liabilities and when |
| the deferred tax balances relate to the same taxation authority. Current |
| tax assets and tax liabilities are offset where the entity has a legally |
| enforceable right to offset and intends either to settle on a net basis, |
| or to realise the asset and settle the liability simultaneously. |
| |
+----------------------------------------------------------------------------+
| 1.18 Employee benefits |
+----------------------------------------------------------------------------+
| (i) Wages and salaries, annual leave and sick leave |
+----------------------------------------------------------------------------+
| Liabilities for wages and salaries, including non-monetary benefits, |
| expected to be settled within 12 months of the reporting date are |
| recognised in other payables in respect of employees' services up to the |
| reporting date and are measured at the amounts expected to be paid when |
| the liabilities are settled. |
+----------------------------------------------------------------------------+
| (ii) Share-based compensation |
+----------------------------------------------------------------------------+
| The Group operates a share-based compensation plan. The fair value of the |
| employee services received in exchange for the grant of the options is |
| recognised as an expense. The total amount to be expensed over the |
| vesting period is determined by reference to the fair value of the options |
| granted, excluding the impact of any non-market vesting conditions (for |
| example, profitability and sales growth targets). Non-market vesting |
| conditions are included in assumptions about the number of options that |
| are expected to vest. At each balance sheet date, the entity revises its |
| estimates of the number of options that are expected to vest. It |
| recognises the impact of the revision to original estimates, if any, in |
| the income statement, with a corresponding adjustment to equity. |
+----------------------------------------------------------------------------+
| The proceeds received net of any directly attributable transaction costs |
| are credited to share capital (nominal value) and share premium when the |
| options are exercised. |
+----------------------------------------------------------------------------+
| ii) Bonuses |
+----------------------------------------------------------------------------+
| The Group recognises a liability and an expense for bonuses. Bonuses are |
| approved by the board and a number of factors are taken into consideration |
| when determining the amount of any bonus payable, including the |
| recipient's existing salary, length of service and merit. The Group |
| recognises a provision where contractually obliged or where there is a |
| past practice that has created a constructive obligation. |
+----------------------------------------------------------------------------+
+----------------------------------------------------------------------------+
| 1.19 Revenue recognition |
+----------------------------------------------------------------------------+
| The Company recognises revenue from the sale of goods and disposal of |
| other assets when the amount of revenue can be reliably measured, it is |
| probable that future economic benefits will flow to the entity and the |
| significant risks and rewards of ownership have been transferred to the |
| buyer. |
+----------------------------------------------------------------------------+
| Interest Income |
+----------------------------------------------------------------------------+
| Interest income is recognised on a time proportion basis using the |
| effective interest method. |
+----------------------------------------------------------------------------+
| 1.20 Leases |
+----------------------------------------------------------------------------+
| Leases in which a significant portion of the risks and rewards of |
| ownership are not transferred to the Group as lessee are classified as |
| operating leases. Payments made under operating leases (net of any |
| incentives received from the lessor) are charged to the income statement |
| on a straight-line basis over the period of the lease. |
+----------------------------------------------------------------------------+
+---------------------------------------------+------------------+----------+--------------------------+----------+
| 2 Earnings per share | |
+------------------------------------------------------------------------------------------------------+----------+
| | | | |
+---------------------------------------------+------------------+-------------------------------------+----------+
| (a) Basic | |
+------------------------------------------------------------------------------------------------------+----------+
| Basic loss per share is calculated by dividing the loss attributable to equity holders | |
| of the Company by the weighted average number of ordinary shares in issue during the | |
| year. | |
+------------------------------------------------------------------------------------------------------+----------+
| | | |
+---------------------------------------------+--------------------------------------------------------+----------+
| | 2009 | 2008 | |
| | Group | Group | |
+---------------------------------------------+------------------+-------------------------------------+----------+
| | | | |
+---------------------------------------------+------------------+-------------------------------------+----------+
| Loss attributable to equity holders of the | $(2,425,421) | $(3,561,335) | |
| Company | | | |
+---------------------------------------------+------------------+-------------------------------------+----------+
| Weighted average number of ordinary shares | 789,639,838 | 734,205,111 | |
| in issue | | | |
+---------------------------------------------+------------------+-------------------------------------+----------+
| Basic loss per share (US Cents per share) | | $(0.49) | |
| | $(0.31) | | |
+---------------------------------------------+------------------+-------------------------------------+----------+
| | | |
+---------------------------------------------+--------------------------------------------------------+----------+
| | | |
+---------------------------------------------+--------------------------------------------------------+----------+
| (b) Diluted | | |
+---------------------------------------------+--------------------------------------------------------+----------+
| Diluted loss per share is calculated by adjusting the weighted average number of | |
| ordinary shares outstanding to assume conversion of all dilutive potential ordinary | |
| shares. The Company has one category of dilutive potential ordinary shares: share | |
| options. For these share options, a calculation is performed to determine the number | |
| of shares that could have been acquired at fair value (determined as the average | |
| annual market share price of the Company's shares) based on the monetary value of the | |
| subscription rights attached to outstanding share options. The number of shares | |
| calculated as above is compared with the number of shares that would have been issued | |
| assuming the exercise of the share options. | |
+------------------------------------------------------------------------------------------------------+----------+
| | 2009 | 2008 | |
| | | | |
+---------------------------------------------+-----------------------------+--------------------------+----------+
| Total Share Options in Issue | 7,896,398 | 7,896,398 | |
| at the year end | | | |
+---------------------------------------------+-----------------------------+--------------------------+----------+
| | | |
+---------------------------------------------+--------------------------------------------------------+----------+
| The effect of all the above share options granted is anti-dilutive and as a result, | |
| they have been omitted from the calculation of diluted loss per share. | |
+------------------------------------------------------------------------------------------------------+----------+
| | | | | |
+---------------------------------------------+------------------+----------+--------------------------+----------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR BRGDXIGBBGGL
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