TIDMAMPH
RNS Number : 1225O
Aggregated Micro Power Holdings PLC
26 May 2015
Aggregated Micro Power Holdings plc
("AMPH", the "Company" or the "Group")
Results for the year ended 31 December 2014
Aggregated Micro Power Holdings plc, the renewable energy
developer focused on biomass energy generation, announces its
audited results for the year ended 31 December 2014.
Operational Highlights
-- Proposed strategic partnership with Forest Fuels Holdings Ltd ("Forest Fuels")
-- Wood drying facilities installed and commissioned at Low Plains
-- Significant upgrade and re-commissioning work carried out on Low Plains 1MWe
-- Five biomass boilers installed and refinanced via AMPIL and
two additional biomass boilers installed and refinanced post year
end
Future Developments
-- Planning consent received for two 1.5MW gasification CHP
sites in Devon and Kent; construction to commence within the next
12 months
-- Biomass Boiler and CHP ESCO (energy service company) pipeline
in excess of GBP5m expected to be installed over the next 12
months
-- 50% interest secured in two 50MWe CHP developments on the
Humber awaiting next round of Contracts for Difference auction
Financial Highlights
-- Group revenue increased by 77% to GBP252,973 (2013: GBP142,665)
-- Group loss before tax adjusted for non-cash items and one off charges(1) : GBP3,194,465
-- Reported Group loss before tax of GBP6,038,730 (2013:
GBP2,445,261) including non-cash items and one-off charges
-- GBP9.5m (before expenses) raised at IPO in July 2014
-- Successful launch of AMPIL(2) and on-going discussions with
investment institutions in relation to the potential funding of the
Group's development pipeline
Proposed Strategic Partnership with Forest Fuels
The strategic partnership is expected to include:
-- Assistance with funding wood chip drying facilities on Forest Fuels' existing depots
-- Assistance with Forest Fuels ESCO developments which can be
sold on to AMPIL or other third party finance providers
-- Sale of dried wood chip to Forest Fuels from AMP gasification plants
-- Forest Fuels preferred supplier status for biomass boilers managed by AMP on behalf of AMPIL
Further details will be provided to shareholders in due
course.
(1) Non-cash items and one off charges relate to an IFRS fair
value adjustment on deferred consideration shares which may or may
not be issued subject to certain hurdles being met, an impairment
charge at Low Plains, tax credits and loss on disposal of AMP Heat
Limited.
(2) AMPIL is a special purpose vehicle which is wholly owned by
Law Debenture for general charitable purposes and is funded via the
issuance of listed loan notes.
Richard Burrell, Chief Executive of Aggregated Micro Power
Holdings plc, said: "I am very pleased to announce our first
preliminary results since listing on AIM last year. Adjusted for
non-cash items and one off charges our underlying performance has
been broadly in line with management's expectations. In addition to
our financial results, we announce our intention to form a
strategic partnership with Forest Fuels, a leading and profitable
biomass chip and pellet distributor with sales representing 10% of
the UK chip market; this is a significant step in the development
of the Group which could accelerate our strategic ambitions
significantly and, together with the operational progress of the
business, allows us to look to the future with great
confidence."
Enquiries
Aggregated Micro Power Holdings plc 020 7382 7800
Richard Burrell, CEO
Mark Tarry, CFO
Helene Crook, Investor Relations
Haggie Partners
Peter Rigby / Brian Norris 020 7562 4444
finncap Ltd
Ed Frisby / Simon Hicks (corporate
finance) 020 7220 0500
Stephen Norcross (corporate broking) 020 7220 0513
Notes to Editors:
About Aggregated Micro Power Holdings plc
The AMP Group was established to develop, own and operate
renewable energy generating facilities. The AMP Group's strategy is
to develop and operate projects using small-scale technologies for
converting biomass to energy and to sell the energy produced in the
form of electricity, heat and wood fuel.
The AMP Group's existing facilities comprise a 1MWe CHP plant
located at Low Plains in Cumbria and a heat dried wood chip sales
business on the same site in Cumbria. AMP has also installed and
commissioned seven biomass boilers supplying heat to schools,
hotels, a care home and a rural business park.
EXECUTIVE CHAIRMAN'S STATEMENT
This is our inaugural Report and Accounts since becoming an AIM
listed company. It has been a period of frenetic activity in terms
of delivering on our business objectives and this is detailed in
the Strategic Report. I would like to thank our shareholders,
management and staff for their continued commitment and hard
work.
The regulatory and economic background has produced some
surprises. Small-scale biomass continues to receive strong support
through the Renewable Heat Incentive and this is a market which is
growing in size and maturity each year. The recent regulations
regarding fuel quality have helped to stimulate the market for
forced dried wood chip and AMP's strategy which is focussed on
using surplus heat at its Combined Heat and Power (CHP) plants to
dry wood chip for onward sale will provide us with a significant
capability to sell high quality wood chip into the growing biomass
boiler market. Whilst at the time of our IPO no one would have
forecast today's low oil price, we have not seen any decline in
biomass boiler sales and our pipeline for Energy Service Company
("ESCO") contracts remains robust.
We have continued to invest in our plant at Low Plains and
whilst we have prudently reduced the carrying value of this asset
in the consolidated statement of financial position we expect good
growth in operating cash flow during 2015. We intend to expand Low
Plains in 2015 and we have recently installed two additional
smaller-scale CHP systems on the site.
We have now received planning approval on our future CHP sites
in Kent and Devon. We intend to commence construction at both sites
in the next 12 months. Looking beyond 2015, we have secured a
significant position in two large scale biomass CHP developments in
Immingham and Hull and both these schemes have planning and grid
connection offers. With a strong pipeline, our future success will
depend upon our ability to attract further capital to enable
schemes to reach financial close, begin construction and ultimately
to be refinanced, post commissioning.
We are now getting into the execution phase of our business plan
as outlined at the time of the IPO and I look forward to reporting
further progress over time.
Neil Eckert
Executive Chairman
22 May 2015
Strategic Report
Following the successful admission to AIM in July 2014 raising
GBP9.5m from new and existing investors, we are pleased to present
our inaugural Report and Accounts for the twelve months ending 31
December 2014.
AMP Group strategy
The AMP Group was established to develop, own and operate
renewable energy generating facilities. The AMP Group's strategy is
to develop and operate projects using small-scale technologies for
converting biomass to energy and to sell the energy produced in the
form of electricity, heat and wood fuel.
The AMP Group's preferred technology for generating electricity
from wood fuel involves a process of gasification, in which wood is
converted into syngas by the application of heat in a low oxygen
environment. The engine, as well as producing electricity,
generates waste heat which can be captured and used commercially to
dry the wood fuel, firstly, needed as feedstock for gasification,
and secondly, for sale in the open market or into the portfolio of
biomass boilers operated and managed by AMP. The AMP Group's use of
excess heat to dry wood chip for onward sale provides a natural
hedge to adverse movements in feedstock prices, as increases in
feedstock prices can potentially be offset by increases in wood
chip prices.
The AMP Group intends to replicate its strategy at new locations
and to refinance its projects once they have been commissioned.
This will enable the AMP Group to recycle capital in order to
develop further projects. The Company may also pursue and
prioritise other opportunities where it is commercially
advantageous to do so.
AMP seeks to recognise the value of its projects held directly
at fair value in accordance with IAS 39.9. Henceforth, changes in
fair value will be booked as an unrealised profit or loss in the
Company's own unconsolidated accounts. Quarterly valuations are
expected to be based on a discounted cash flow analysis of each
project's future cash flow and will be validated at the time of a
project's commissioning and at year end by an independent third
party acceptable to the Company's auditors.
In addition, the Directors anticipate that the AMP Group will
sell its smaller scale biomass boiler and CHP projects following
financial close, to Aggregated Micro Power Infrastructure Limited
('AMPIL') or other third parties and aim to earn development fees,
a margin on the management of the plant, revenues from the supply
of fuel and a deferred payment in the relevant project.
Results
The Group made a loss before tax of GBP3,194,465, adjusted for
non cash items and one off charges being the impairment and
deferred consideration charges, tax credits and the loss on the
disposal of AMP Heat Limited, which was broadly in line with
management's expectations. The total loss before tax of
GBP6,038,730 includes a provision for the deferred consideration
shares which may or may not be issued, subject to certain hurdles
being met, as well as a GBP2,224,661 impairment charge at Low
Plains. Turnover was lower than predicted, mainly due to unforeseen
downtime in October and December at Low Plains but the impact on
profitability was partially offset by lower depreciation
charges.
Our intention is to build on the operational platform we have
built at Low Plains, bolting on new revenue lines in the form of
additional electricity generation and wood chip drying capacity to
enable us to reverse the impairment charge in future years.
Progress following the AMP IPO in July 2014
AMP has continued to invest in its 1.0MW plant at Low Plains in
Cumbria which has involved capital investment in new wood chip
drying floors for third party chip sales as well as a number of
further upgrades and improvements as part of the commissioning
process for the main plant. Whilst these additional works have
taken longer than anticipated, resulting in down time at the plant
during recent months, the plant is now commissioned post year end
and we are now in the phase of operational stabilisation and
improvement in order to produce high and consistent energy outputs
for the remainder of 2015.
In December, we purchased a small scale 45kW CHP unit from
Germany and in January 2015 we purchased a similar 40kW unit from
Finland, with the intention of providing additional heat to the
drying floors as well as electricity for the parasitic load at Low
Plains. Both systems are now installed and commissioned. These
smaller units are expected to have shorter commissioning periods
and a higher return on investment compared with larger CHP
systems.
We have now received planning approval for our next gasification
development sites in Kent and Devon. We intend to commence
construction on these two projects in the next 12 months.
During the financial year 2014, AMP has installed seven biomass
boilers supplying heat to three schools, a care home, a rural
business park and two biomass boilers at a Champneys health spa
resort. Five of these systems are fully commissioned and have been
sold to AMPIL and development fees have been earned by AMP. AMPIL
is a special purpose vehicle which is wholly owned by Law Debenture
for general charitable purposes and is funded via the issuance of
listed loan notes. AMP will continue to manage the boiler projects
on behalf of AMPIL under the terms of a commercial agreement. The
remaining two boilers installed at Champneys have been commissioned
in 2015 and have been sold to AMPIL in the financial year 2015.
AMP has also secured a significant development interest in two
large scale biomass CHP developments in Immingham and Hull on two
port-side locations that will be leased from Associated British
Ports. Both these schemes have secured planning permission and grid
connection offers for 49.0MW and 49.9MW respectively. Over the next
twelve months, AMP and its development partners intend to secure
external, off-balance sheet construction finance for these projects
which is contingent on both schemes achieving Government incentives
in the form of Contracts for Difference. Both projects are unlikely
to be commissioned until 2018 at the earliest.
Future Financing
AMP requires further capital to develop out its substantial
pipeline of future projects as well as to invest in sites currently
operated by Forest Fuels, pursuant to our proposed strategic
partnership with Forest Fuels.
We are pleased to announce that we are in discussions with
investment institutions in relation to the potential funding of the
Group's development pipeline. Further details will be provided to
shareholders in due course.
Proposed Strategic Partnership with Forest Fuels
The strategic partnership is expected to include:
-- Assistance with funding wood chip drying facilities on Forest Fuels' existing depots
-- Assistance with Forest Fuels ESCO developments which can be
sold on to AMPIL or other third party finance providers
-- Sale of dried wood chip to Forest Fuels from AMP gasification plants
-- Forest Fuels preferred supplier status for biomass boilers managed by AMP on behalf of AMPIL
Further details will be provided to shareholders in due
course.
Risk factors
The principal risks of the business are documented below:
Risk Control Procedure
----------------- -------------------------------------------------------------------
Staff retention Long term lock in arrangements and incentivisation
risk structure to retain key staff through
equity ownership.
Contractual minimum notice periods for
key staff sufficient to ensure time
for recruitment/handover.
----------------- -------------------------------------------------------------------
Public policy Minimise construction timetable for
risk individual projects. Changes to public
including policy mechanisms can adversely affect
changes to project returns but the Group is only
renewable exposed during the time between financial
incentives close and commencement of operations.
Small scale projects which AMP is developing
have relatively short construction times
and so lower public policy exposure.
In addition, where practicable, the
Company will seek to use existing public
policy measures to lock in an entitlement
to specific incentive rates before construction
commences.
----------------- -------------------------------------------------------------------
Feedstock The Company will monitor prices and
price risk establish a policy for hedging exposures
including managing merchant risk, including
the development of a wood fuel supply
model as a natural hedge against increasing
biomass fuel prices.
The Company will establish supply contracts
to minimise exposure where these are
available at a reasonable price.
----------------- -------------------------------------------------------------------
Electricity The Company will establish off-take
price risk contracts (Power Purchase Agreements)
to minimise exposure where these are
available on reasonable terms.
----------------- -------------------------------------------------------------------
Planning The Company will seek to minimise extent
risk of exposure and financial commitment
prior to successful planning approvals.
----------------- -------------------------------------------------------------------
Environment Industrial sites have potential exposure
Agency / to environmental and Health and Safety
Health and ('H&S') issues.
Safety risks Health and Safety risk assessment has
been undertaken, and relevant policies
are in place. Health and Safety review
is given priority at management meetings
and Board meetings. Staff training is
provided as appropriate.
----------------- -------------------------------------------------------------------
Tax risk Tax computations, VAT computations and
PAYE are outsourced to a professional
service provider.
----------------- -------------------------------------------------------------------
AMP Group objectives and KPIs for 2015 are as follows:
-- Achieve the maximum power output on the existing plant at Low
Plains of 1.0 MWe and fully utilise spare heat from the drying
floors to maximise revenues from the sale of forced dried wood chip
to third parties.
-- Complete the installation and testing of the two small-scale
gasification systems at Low Plains to allow a decision to be made
on which technology to roll-out at our new gasification development
sites.
-- Commence construction at the two 1.5 MWe sites at Hill
Barton, Devon, and Kingsnorth, Kent, in the next 12 months and aim
to commission these projects within 12 months following breaking
ground. Identify and apply for planning permission on at least two
further sites for construction to commence in 2016.
-- Execute on the existing GBP5m+ pipeline of biomass boiler
ESCO projects, wood drying facilities and/or small-scale CHP ESCO
installations with the aim to sell completed systems to AMPIL or
other third parties to generate development fees.
-- Supplement AMP's cash resources with additional new funding
from one or a combination of: the refinancing of existing assets;
raising project finance from third party providers; asset financing
of core items of equipment; the issue of new Ordinary Shares for
cash; or any other compelling financing mechanism where the
Directors consider doing so to be in the best interests of the
Company and its Shareholders.
-- Seek to pay a dividend to Ordinary Shareholders in respect of
2015, provided sufficient profits have been generated.
Industry and policy background
We believe that there are a number of features of the renewable
energy market which are highly beneficial for the AMP Group:
-- The UK's lack of energy security means that domestic energy
production, especially renewable energy production, has a high
value even in the absence of environmental factors and falling oil
prices;
-- In light of the gap between the UK's current and proposed
energy supply mix, public policy support measures, including
incentives, are generally expected to endure;
-- Current and proposed support measures specifically favour the
smaller scale, de-centralised generation that the AMP Group is
targeting;
-- By operating smaller scale facilities in close proximity to
customers, the AMP Group is able to reduce energy delivery costs
and exploit the price premium between retail and wholesale energy
pricing; and
-- The market for forced dried wood chip is growing rapidly and
is strongly supported by new requirements introduced under the RHI
Regulations on 24th September 2013, setting emissions limits for
biomass boilers. The regulations stipulate that all RHI
participants must buy dry fuels, or allow fuel felled from their
own land to dry out sufficiently before use and ensure that fuel
doesn't become damp when being stored. Non- compliance may delay or
affect RHI payments.
Under the EU's Renewable Energy Directive, the UK was set a
legally binding target of procuring 15 per cent of its energy
consumption from renewable sources by 2020. In 2013 renewable
energy accounted for only 5.2 per cent of total energy consumption.
We believe this target should underpin political support and
financial incentives for the renewable energy sector in the near
term.
The UK's drive to decarbonise (the Government has a legally
binding target of reducing the UK's greenhouse gas emissions by 80
per cent by 2050 against 1990 levels), is expected to require
significant structural changes to the power market, with 8 GW of
coal fired generating capacity scheduled to be decommissioned by
2015 due to the Large Combustion Plant Directive. This represents
10.2 per cent of current power generation; a reduction in supply,
which in the Directors' opinion will help support the wholesale
price of electricity in the near term.
The inception of the RHI in November 2011 has driven a rapid
uptake of biomass boilers fuelled by wood chip. Biomass boilers
account for 99 per cent of the capacity of accredited RHI
installations (as of December 2014). From January 2013 to December
2014 the installed capacity of RHI accredited biomass boilers grew
almost sevenfold from 175MW to 1,215 MW.
We believe that the structure of the energy markets, in the UK
and elsewhere, provide a commercial opportunity for the small scale
energy facilities that comprise the AMP Group's primary areas of
focus, making use of local energy sources to generate and supply
energy close to the point of demand, so capturing higher retail
prices for the energy produced and reducing the costs arising from
energy delivery losses.
This Strategic Report was approved by the Board of Directors of
the Company on 22 May 2015 and signed on their behalf by:
Richard Burrell
Chief Executive Officer
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2014
Year ended Year ended
31 Dec 31 Dec
2014 2013
Note GBP GBP
Continuing operations
Revenue 2 252,973 142,665
Cost of sales (113,801) (12,776)
Gross profit 139,172 129,889
------------------------ --------------------
Other operating income 11,667 -
Administrative expenses (3,253,036) (2,476,701)
Fair value adjustment (624,603) -
on deferred consideration
Impairment loss 4 (2,224,661) -
------------------------ --------------------
Total administrative
expenses (6,090,633) (2,476,701)
Loss from operations (5,951,461) (2,346,812)
------------------------ --------------------
Finance income 9,788 -
Finance expense (97,057) (98,449)
------------------------ --------------------
Total finance expense (87,269) (98,449)
Loss before tax (6,038,730) (2,445,261)
------------------------ --------------------
Tax credit 3 493,470 -
Loss for the year from
continuing operations (5,545,260) (2,445,261)
------------------------ --------------------
Loss on discontinued
operations, net of tax (4,999) (138,338)
Loss attributable to
the ordinary equity holders
of the parent (5,550,259) (2,583,599)
======================== ====================
Loss per share attributable
to the ordinary equity holders
of the parent
Continuing and discontinued
operations basic (Pence) 6 (27.2) (19.9)
Continuing operations
basic (Pence) 6 (27.2) (18.9)
Consolidated Statement of Financial Position
As at 31 December 2014
31 Dec 31 Dec 31 Dec
2014 2013 (As 2012 (As
restated) restated)
Note GBP GBP GBP
Non-current assets
Property, plant
and equipment 4 5,050,491 5,832,577 4,580,628
--------------- ------------------------- ---------------
Total non-current
assets 5,050,491 5,832,577 4,580,628
--------------- ------------------------- ---------------
Current assets
Inventories 347,543 12,303 26,988
Trade and other
receivables 1,397,249 477,073 307,624
Cash and cash
equivalents 4,727,078 342,103 213,529
--------------- ------------------------- ---------------
Total current
assets 6,471,870 831,479 548,141
--------------- ------------------------- ---------------
Total assets 11,522,361 6,664,056 5,128,769
--------------- ------------------------- ---------------
Current liabilities
Trade and other
payables 828,766 487,535 282,229
Loans and borrowings 5 173,874 - 305,649
--------------- ------------------------- ---------------
Total current
liabilities 1,002,640 487,535 587,878
--------------- ------------------------- ---------------
Non-current liabilities
Loans and borrowings 5 759,317 1,075,673 1,404,327
Deferred consideration 1,873,810 - -
Total non-current
liabilities 2,633,127 1,075,673 1,404,327
--------------- ------------------------- ---------------
Total liabilities 3,635,767 1,563,208 1,992,205
--------------- ------------------------- ---------------
Net assets 7,886,594 5,100,848 3,136,564
=============== ========================= ===============
Capital and reserves
Share capital 128,473 77,687 54,078
Share premium 9,484,658 4,496,412 6,167,447
Merger reserve 6,648,126 7,897,333 -
Other reserve 4,546,180 - -
Capital contribution - - 1,702,024
Retained deficit (12,920,843) (7,370,584) (4,786,985)
--------------- ------------------------- ---------------
Total equity 7,886,594 5,100,848 3,136,564
=============== ========================= ===============
Consolidated Statement of Changes in Equity
For year ended 31 December 2014
Year ended 31
December Share Share Capital Retained Merger Other
2013 capital premium contribution deficit reserve reserve Total
GBP GBP GBP GBP GBP GBP GBP
Equity as at 1
January
2013 as
previously
stated 54,078 6,167,447 1,702,024 (4,900,590) - - 3,022,959
Prior year
adjustment
(Note 27) - - - 113,605 - - 113,605
--------------- --------------- --------------- --------------- ------------------ --------------- ---------------
Restated
balance at 1
January 2013 54,078 6,167,447 1,702,024 (4,786,985) - - 3,136,564
Loss for the
year - - - (2,583,599) - - (2,583,599)
--------------- --------------- --------------- --------------- ------------------ --------------- ---------------
Total
comprehensive
expense - - - (2,583,599) - - (2,583,599)
Contributions
by and
distributions
to owners:
Issue of share
capital 23,609 4,496,412 - - - - 4,520,021
Capital
contribution - - - - 27,862 - 27,862
Merger reserve - (6,167,447) (1,702,024) - 7,869,471 - -
--------------- --------------- --------------- --------------- ------------------ --------------- ---------------
Equity as at
31 December
2013 77,687 4,496,412 - (7,370,584) 7,897,333 - 5,100,848
=============== =============== =============== =============== ================== =============== ===============
Year ended 31
December Share Share Capital Retained Merger Other
2013 capital premium contribution deficit reserve reserve Total
GBP GBP GBP GBP GBP GBP GBP
Equity as at 1
January
2014 77,687 4,496,412 - (7,370,584) 7,897,333 - 5,100,848
Loss for the
period - - - (5,550,259) - - (5,550,259)
--------- ----------- -------------- -------------- ------------- -------------------------- -------------
Total
comprehensive
expense - - - (5,550,259) - - (5,550,259)
Contributions
by and
distributions
to owners:
Issue of share
capital 50,786 5,259,948 - - - 4,848,615 10,159,349
Share issue
cost - (271,702) - - - (302,435) (574,137)
Merger reserve - - - - (1,249,207) - (1,249,207)
--------- ----------- -------------- -------------- ------------- -------------------------- -------------
Equity as at
31 December
2014 128,473 9,484,658 - (12,920,843) 6,648,126 4,546,180 7,886,594
========= =========== ============== ============== ============= ========================== =============
Consolidated Statement of Cash Flows
For year ended 31 December 2014
31 Dec 31 Dec
2014 2013
(Restated)
Note GBP GBP
Operating activities
Loss for the period
after tax (5,550,259) (2,583,599)
Adjustments for:
Impairment loss 4 2,224,661 -
Tax credit 3 (493,470) -
Interest Income (9,788) -
Fair value adjustment 624,603 -
on financial liabilities
at fair value through
profit and loss
Gain on disposal of (6,699) -
subsidiary
Loss on disposal of 30,999 -
fixed asset
Interest paid 97,057 98,449
Depreciation of property,
plant and equipment 4 27,095 17,461
Cashflows from operating
activities before changes
to working capital (3,055,801) (2,467,689)
Movement in foreign
exchange 7,074 2,022
(Increase)/decrease
in inventories (335,240) 14,685
(Increase)/decrease
in trade and other
receivables (492,445) (169,449)
Increase/(decrease)
in trade and other
payables 449,470 92,385
(371,141) (60,357)
Cash consumed by operations (3,426,942) (2,528,046)
Research and development 54,148 -
tax credit received
Net cash flows from
operating activities (3,372,794) ( 2,528,046)
Investing activities
Purchase of property,
plant and equipment 4 (2,071,635) (1,243,230)
Proceeds from sale 13,750 -
of assets
Proceeds from sale 508,458 -
of subsidiary
Cash disposed of on (1,358) -
sales of subsidiary
Net cash used in investing
activities (1,550,785) (1,243,230)
Financing activities
Proceeds from issue
of shares 10,159,349 3,899,850
Share issue cost (574,137)
Payments of borrowings (250,000) -
Payments of interest (29,646) -
on borrowings
Bank Interest received 9,788 -
Payments of finance (6,800) -
lease
Net cash from financing
activities 9,308,554 3,899,850
Net increase in cash
and cash equivalents 4,384,975 128,574
Cash and cash equivalents
at beginning of period 342,103 213,529
Cash and cash equivalents
at end of period 4,727,078 342,103
Notes to the financial statements
For the year ended 31 December 2014
1. Basis of preparation of financial statements
The financial information set out above does not constitute
statutory financial statements for the year ended 31 December 2014
or 2013 but is derived from those financial statements. Statutory
financial statements for the year ended 31 December 2013 have been
delivered to the Registrar of Companies. Statutory financial
statements for the year ended 31 December 2014 were approved by the
Board of Directors on 22 May 2015, are audited and will be
delivered to the Registrar of Companies following the Annual
General Meeting on 23 June 2015.
The Company's auditors, BDO LLP, have reported on the 2014 and
2013 financial statements and those reports were:
i. Not qualified;
ii. Did not include a reference to any matters to which the
auditors drew attention to by way of emphasis without qualifying
their report; and
iii. Did not contain a statement under Section 498(2) and 498(3)
of the Companies Act 2006 in respect of the financial statements
for the year ended 31 December 2014 and 31 December 2013.
The financial statements have been adjusted to account for the
expected repayment of GBP609,960 stolen from the Company by a
former employee who has since been dismissed for gross misconduct.
The theft related to forged wood fuel invoices at Low Plains for
the period beginning February 2012 and ending in March 2015. The
former employee has undertaken to repay the monies in full and the
Group has been provided with a legal charge over sufficient assets
to ensure full repayment. This matter is isolated to a single
employee and does not affect any customers or suppliers.
The Directors anticipate a full cash repayment of GBP609,960 to
the Group during 2015 and have made the following adjustments to
the prior year financial statements.
Full year 2012
Expenses have been reduced in the consolidated statement of
comprehensive income by GBP113,605 resulting in a commensurate
reduction in carried forward losses. The Group have recognised a
receivable of GBP136,326 against the former employee and a VAT
liability of GBP22,721 in the consolidated statement of financial
position.
Full year 2013
During the year the majority of wood fuel costs at Low Plains
were capitalised as an asset under construction. Fixed assets have
been reduced by GBP178,531 and the Group have recognised a
receivable of GBP214,237 against the former employee and a VAT
liability of GBP35,706 resulting in no net change to the previously
reported balance sheet position apart from the adjustment noted
above re 2012.
Full year 2014
Although the 2014 figures are not being restated we have
included the impact of the fraud for 2014 and 2015 in here for
completeness.
During the year the majority of wood fuel costs at Low Plains
were capitalised as an asset under construction. Fixed assets have
been reduced by GBP196,808 and the Group have recognised a
receivable of GBP235,422 against the former employee and a VAT
liability of GBP38,614 resulting in no net change to the balance
sheet position.
The remaining adjustments will be made in 2015, comprising of a
GBP19,356 reduction in the cost of sales, a receivable of GBP23,975
against the former employee and a VAT liability of GBP4,619. These
2015 adjustments do not require a restatement of prior year results
but have been included for completeness.
2. Revenue
Year ended 31 December
2014 2013
GBP GBP
Electricity generation 46,009 2,762
Wood fuel sales 89,726 136,903
Development, management
and consultancy fees 117,238 3,000
---------------------------------- -------------------
252,973 142,665
================================== ===================
Total revenue from transactions with AMP Heat
Ltd amounted to GBP117,238. No other single
customer represents 10% or more of total revenue.
3. Taxation
Year ended 31 December
2014 2013
GBP GBP
Current tax credit 493,470 -
Deferred tax expense - -
------------------------------ ------------------------
Total tax credit 493,470 -
Loss for the year (6,038,730) (2,583,599)
Loss on sale of subsidiary (4,999) -
Losses before tax (6,043,729) (2,583,599)
------------------------------ ------------------------
Expected tax charge based on the standard rate
of corporation tax
at the domestic rate of 21.50%
(2013: 23.25%) (1,299,401) (600,687)
Expenses not deductible for
tax purposes 615,830 156,144
Capital allowances in excess 410,853 -
of depreciation
Differences in tax rates (48,495) -
Unprovided losses carried forward 689,882 444,543
R&D tax credit received 124,802 -
Total credit 493,470 -
============================== ========================
A deferred tax asset on carried forward loss has not been
recognised on the basis that there is no certainty over the profits
for the 12 month period following the year end losses carried
forward to be utilised against future profits of GBP9,753,103
(2013: GBP6,587,990). Deferred tax unrecognised at the end of the
year amount to GBP1,950,621 (2013: GBP1,317,598). The deferred tax
rate for 31 December 2014 is 20% being the substantively enacted
rate at the end of the year. The Finance Act 2013 which was
substantially enacted on 2 July 2013 includes legislation reducing
the main rate of corporation tax from 24% to 23% from 1 April 2013
and further reducing the main rate of corporation tax from 23% to
21% from 1 April 2014 and to 20% from 1 April 2015.
Tax credit of GBP54,148 for Research and Development Tax Relief
in relation to technical development in the gasification plant for
FY 2012 was received during the year. During the year the Company
also applied for Research and Development Tax Relief for FY 2013
(GBP70,666) and ECA Tax relief for both FY 2012 and 2013 (Total:
GBP368,656). Total tax credits recognised in 2014 amount to
GBP493,470.
4. Property, plant and equipment
Assets Plant Furniture Computer Motor Total
Under & Machinery & Fixtures Equipment Cars
Construction
GBP GBP GBP GBP GBP
Cost
As at 1 January
2012 3,417,524 11,150 8,000 1,426 - 3,438,100
Additions
for 2012 481,983 124,058 - - 39,841 645,882
Capitalised
borrowing
costs for
2012 512,626 - - - - 512,626
--------------- -------------- ------------- --------------- ---------- -----------------
As at 1 January
2013 4,412,133 135,208 8,000 1,426 39,841 4,596,608
Additions
for 2013 1,077,085 199,534 - 791 - 1,277,410
Disposals
for 2013 - - (8,000) - - (8,000)
--------------- -------------- ------------- --------------- ---------- -----------------
As at 1 January
2014 5,489,218 334,742 - 2,217 39,841 5,866,018
Additions
for 2014 2,059,172 10,560 - 903 38,000 2,108,635
Disposals
for 2014 (17,923) (594,216) - - (43,174) (655,313)
Transfers (399,757) 396,424 - - 3,333 -
Impairment (2,224,661) - - - - (2,224,661)
--------------- -------------- ------------- --------------- ---------- -----------------
As at 31
December
2014 4,906,049 147,510 - 3,120 38,000 5,094,679
--------------- -------------- ------------- --------------- ---------- -----------------
Depreciation
As at 1 January
2012 - 531 2,222 396 - 3,149
Charge for
the year
2012 - 6,273 2,667 475 3,416 12,831
--------------- -------------- ------------- --------------- ---------- -----------------
As at 1 January
2013 - 6,804 4,889 871 3,416 15,980
Charge for
the year
2013 - 13,753 - 629 7,968 17,461
Disposals - - (4,889) - - -
for 2013
--------------- -------------- ------------- --------------- ---------- -----------------
As at 1 January
2014 - 20,557 - 1,500 11,384 33,441
Charge for
the year
2014 - 16,935 - 485 11,931 29,351
Disposals
for the period - (2,257) - - (16,347) (18,604)
As at 31
December
2014 - 35,235 - 1,985 6,968 44,188
--------------- -------------- ------------- --------------- ---------- -----------------
Net book
value
As at 1 January
2012 3,417,524 10,619 5,778 1,030 - 3,434,951
As at 1 January
2013 4,412,133 128,404 3,111 555 36,425 4,580,628
=============== ============== ============= =============== ========== =================
As at 1 January
2014 5,489,218 314,185 - 717 28,457 5,832,577
=============== ============== ============= =============== ========== =================
As at 31
December
2014 4,906,049 112,275 - 1,135 31,032 5,050,491
=============== ============== ============= =============== ========== =================
Impairment of Low Plains
The Directors have used a DCF model to determine the revised
carrying value of Low Plains. The model applies a discount rate of
12%, which the Directors believe is a fair market based discount
rate for a biomass plant, to forecast forward looking earnings and
assumes the plant generates at its target 1MW capacity. The
valuation excludes the additional income from the smaller scale CHP
and biomass boiler units which are expected to increase the
profitability of Low Plains in 2015. The total impairment loss
recognised in the consolidated statement of comprehensive income is
GBP2,224,661 (2013: nil), making the recoverable value of the plant
at year end equal to approximately GBP4,694,189.
5. Loans and borrowings
31 December 0-3 months 3 months 1 to 5 Over 5
2013 to 1 year years years
Financial Liabilities GBP GBP GBP GBP
Shareholders'
loan - - - 1,075,673
Other loan - - - -
- - - 1,075,673
====================== =========================== ========================= =================================
31 December 0-3 months 3 months 1 to 5years Over 5
2014 to 1 year years
Financial Liabilities GBP GBP GBP GBP
Shareholders'
loan 165,758 - 740,231 -
Other loan 2,028 6,088 19,086 -
167,786 6,088 759,317 -
====================== =========================== ========================= =================================
The fair values of non-current liabilities are
not materially different to their carrying value.
The rate of interest on the shareholder loan is
8%. The loan is repayable on demand from 1 January
2015 and must in any event be repaid by 30 November
2020.
6. Loss per Share
Year ended Year ended
31 Dec 2014 31 Dec
2013
GBP GBP
Loss attributable to equity
holders of the Company (5,550,259) (2,583,599)
Weighted average number
of shares 20,370,996 12,951,216
Continuing and discontinued
operations basic (Pence) (27.2) (19.9)
Continuing operations basic
(Pence) (27.2) (18.9)
The basic and diluted earnings per share have been calculated
using the loss attributable to shareholders of the parent company,
Aggregated Micro Power Holdings plc. The basic and dilutive loss
per share are the same as the Group made a loss in the year.
7. Post balance sheet event
The Group has successfully installed and commissioned two
biomass boilers at Champneys Forest Mere which have been
transferred to AMPIL for a consideration of GBP519,750. The Group
is also in discussions with Forest Fuels Holdings Ltd regarding a
proposed strategic partnership as set out in the Strategic
Report.
Company Balance Sheet
For the year ended 31 December 2014
2014 2013
GBP GBP
Fixed assets
Investments 55,004 55,004
---------------- ------------------
Total non-current assets 55,004 55,004
---------------- ------------------
Current assets
Debtors: Amounts falling due
within one year 9,460,105 4,230,787
Cash 4,670,826 243,272
---------------- ------------------
Total current assets 14,130,931 4,474,059
---------------- ------------------
Current liabilities
Trade and other creditors 55,853 243,836
---------------- ------------------
Total current liabilities 55,853 243,836
---------------- ------------------
Net current assets 14,075,078 4,230,223
---------------- ------------------
Net assets 14,130,082 4,285,227
================ ==================
Equity attributable to equity
holders of the Company
Paid up share capital 128,473 77,687
Share premium account 9,484,658 4,496,412
Other reserve 4,546,180 -
---------------- ------------------
Retained earnings (29,229) (288,872)
---------------- ------------------
Total equity 14,130,082 4,285,227
================ ==================
8. Annual Report & Annual General Meeting
The Company's Report and Accounts for the year
ended 31 December 2014 together with the Notice
of Annual General Meeting are available to view
on the Company's website: www.ampplc.co.uk and
are being sent to shareholders tomorrow. The Annual
General Meeting will be held at 10.00 am on 23
June 2015 at the Company's Registered office:
5 Clifford Street, London W1S 2LG.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR EAKSAASPSEFF
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