TIDMLRL

RNS Number : 0439O

Leyshon Resources Limited

16 September 2013

LEYSHON RESOURCES LIMITED

ABN 75 010 482 274

INTERIM FINANCIAL REPORT

FOR THE HALF-YEAR ENDED

30 JUNE 2013

CORPORATE DIRECTORY

 
 Directors                                 Share Register 
  John Fletcher - Non-Executive Chairman    UK 
  Paul Atherley - Managing Director         Computershare Investor Services 
  Richard Seville - Non-Executive           plc 
  Director                                  2nd Floor, Vintners Place 
  Andrew Berry III - Non-Executive          68 Upper Thames Street 
  Director                                  London 
                                            EC4V 3BJ 
  Company Secretary                         United Kingdom 
  Murray Wylie 
                                            Australia 
  Principal and Registered Offices          Computershare Investor Services 
  China                                     Pty Ltd 
  Suite 04, 21/F, Tower B                   Level 2, Reserve Bank Building 
  Ping An International Financial           45 St Georges Terrace 
  Center,                                   Perth WA 6000 
  No.3 Xinyuan South Road,                  Australia 
  Chaoyang District,                        Telephone: 1300 557 010 
  Beijing 100027                            International: +618 9323 2000 
  Telephone: +86 10 8444 2882               Facsimile: +618 9323 2033 
  Facsimile: +86 10 8444 2887 
  Australia                                 Solicitors 
  Suite 3, Level 3                          Jun He Law Offices - Beijing 
  1292 Hay Street                           Hardy Bowen Solicitors - Perth 
  West Perth WA 6005 
  Telephone: +618 9321 0077                 Stock Exchange Listings 
  Facsimile: +618 9322 4073                 Alternative Investment Market 
                                            London Stock Exchange 
  Auditor                                   10 Paternoster Square 
  Deloitte Touche Tohmatsu                  London EC4M 7LS 
 
  Bankers                                   Australian Stock Exchange 
  Bank of China - Beijing                   Home Branch - Perth 
  National Australia Bank                   2 The Esplanade 
                                            Perth WA 6000 
 
                                            AIM and ASX Code 
                                            LRL 
 

Index

 
 Directors' Report 3 
  Auditor's Independence Declaration 6 
  Directors' Declaration 7 
  Condensed Consolidated statement of profit or loss and other comprehensive income 8 
  Condensed Consolidated Statement of Financial Position 9 
  Condensed Consolidated Statement of Changes in Equity 10 
  Condensed Consolidated Statement of Cash Flows 11 
  Notes to the Condensed Consolidated Financial Statements 12 
  Independent Auditors Report 17 
 
 

DIRECTORS' REPORT

The Directors of Leyshon Resources Limited present their report on the Group consisting of Leyshon Resources Limited ("the Company" or "Leyshon Resources") and the entities it controlled at the end of, or during, the half-year ended 30 June 2013 ("Group").

DIRECTORS

The following persons were Directors of the Company during the half-year ended 30 June 2013 and up to the date of this report:

John W S Fletcher

Paul C Atherley

Richard P Seville

Andrew Berry III

REVIEW AND RESULTS OF OPERATIONS

Operating Results

Net operating loss after tax attributable to members of the Consolidated Entity for the half-year ended 30 June 2013 was US$4,782,043 (2012: US$333,356).

Operations

During the half-year, the Company, through its wholly owned subsidiary Pacific Asia Petroleum Limited (PAPL), announced an accelerated exploration and appraisal programme for its Zijinshan Gas Project on the eastern fringe of the prolific Ordos Gas Basin in Central China.

The main objective of the 2013 work programme is to define a resource sufficient to delineate a third party independently estimated resource by the end of 2013 and to submit a Chinese Reserve Report (CRR) by mid 2014.

The major components of the programme comprise drilling up to six wells, conducting eight flow tests and acquiring 300 kilometres of 2D seismic data. Three of the wells have now been drilled and the additional three are subject to obtaining favourable results from both the testing and seismic programmes and PSC partner agreement.

The programme remains at an early stage in the exploration and appraisal phase of de-risking the project and accordingly each well will be fully evaluated before proceeding with the subsequent well.

During the reporting period, the Company acquired 318 kilometres of 2D seismic data and undertook flow testing of wells ZJS5 and ZJS6, which the Company completed drilling in 2012..

Following the hydraulic facture stimulation of one of the target zones in well ZJS5 a free gas flow rate of 160,000 scf/day was recorded over eight hours of stable flow at a tubing head pressure of 200psi. The initial flow rate recorded on the single zone exceeded management's internal estimate for commercial production of 125,000 scf/day.

Analysis of the results to date suggests that further flow may be possible from untested potential pay zones. Following a three week shut-in period a formation pressure test on a single zone recorded 16.5MPa/2425psi, significantly higher than that recorded in nearby wells in the same strata.

Testing of well ZJS6 was suspended due to technical issues. The well has a total depth of 2,320 metres with 80 metres of cumulative potential pay interval intersected across 15 potential pay zones. Several of the zones tested, which elsewhere in the field are dry, produced water. It has not been possible to isolate or to accurately define the source of the water nor to determine whether these are issues specific to well ZJS6 or more general to this area of the licence. Accordingly the decision has been made to discontinue testing on the well for the time being and to focus exploration and appraisal efforts on the upcoming programme.

It is possible that the ZJS6 well may be revisited at later date to attempt to isolate the water and to test different zones. However very useful information on the target zones has been gathered which will be valuable for testing future wells.

DIRECTORS' REPORT (continued)

The drilling of well ZJS7, at a location approximately three kilometres to the northeast of well ZJS5, has been completed and it is now undergoing testing. The well has a design depth of approximately 2,100 metres and is targeting the same potential pay zones as those intersected in well ZJS5.

Interpretation of the recently acquired 318 kilometres of 2D seismic data has been completed. Initially the results will be used to assist in locating future wells and later to assist in resource assessment. The results are also required as supporting data for the CRR submission.

The Company is now actively looking at acquisition and investment opportunities in the oil and gas sector in locations and projects where it can bring its China advantages to bear.

It is also exploring the merit of whether to separate its energy and gold businesses and will make appropriate notifications in due course.

Effective 1 January 2013, the Company changed its presentation currency from Australian dollars (AUD$) to United States dollars (US$).

SUBSEQUENT EVENTS

On 13 September 2013, the Company announced that it would seek shareholder and regulatory approvals to undertake a corporate restructure to effect the separation of its energy and mineral businesses.

The restructure would involve demerger of the Company's energy assets, including the Company's interests in the Zijinshan Gas Project along with cash reserves of US$35 million, into an energy focussed vehicle, Leyshon Energy Limited (Leyshon Energy). The demerger will be effected via a pro--rata in--specie distribution of 100% of shares in Leyshon Energy to the Company's shareholders

Immediately following implementation of the energy separation, Leyshon Energy intends to apply for listing on the ASX and has appointed Cantor Fitzgerald Limited as its Nominated Adviser to assist with an application for admission to trading on AIM.

The overall financial impact on the Group should the demerger proceed is to:

   --      reduce cash and cash equivalents by $36.0 million, 
   --      reduce other current and non-current assets by $5.2 million, and 
   --      reduce current and non-current liabilities by $7.2 million. 

The loss after tax for the half-year ending 30 June 2013 for the energy assets was $5.4m, which was primarily exploration expense.

The financial impact of the proposed demerger and distribution to owners has not been incorporated into these financial statements.

There were no other significant events occurring after balance date requiring disclosure in the financial statements.

DIRECTORS' REPORT (continued)

AUDITOR'S INDEPENDENCE DECLARATION

Section 307C of the Corporations Act 2001 requires our auditors, Deloitte Touche Tohmatsu, to provide the directors of Leyshon Resources with an Independence Declaration in relation to the review of the half-year financial report. This Independence Declaration is on page 6 and forms part of this Directors' Report.

Signed in accordance with a resolution of the Board of Directors made pursuant to s.306(3) of the Corporations Act 2001.

On behalf of the Directors

Paul Atherley

Managing Director

Beijing, China

13 September 2013

For further information contact:

Leyshon Resources Limited

Paul Atherley - Managing Director

Tel:+8613718001914

admin@leyshonresources.com

Cantor Fitzgerald Europe

David Porter/Rick Thompson (Nominated adviser)

Richard Redmayne (Corporate broking)

Tel: +44 (0)20 7894 7000

Pelham Bell Pottinger

Charles Vivian /James MacFarlane

Tel:+44 (0)20 7861 3232

DIRECTORS' DECLARATION

The directors declare that:

(a) in the directors' opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and

(b) in the directors' opinion, the attached financial statements and notes thereto are in accordance with the Corporations Act 2001, including compliance with accounting standards and giving a true and fair view of the financial position and performance of the consolidated entity.

Signed in accordance with a resolution of the directors made pursuant to s.303(5) of the Corporations Act 2001.

On behalf of the Directors

Paul Atherley

Managing Director

Beijing, China

13 September 2013

CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE HALF-YEAR ENDED 30 JUNE 2013

 
                                              Note       Half-Year      Half-Year 
                                                             Ended          Ended 
                                                      30 June 2013   30 June 2012 
                                                                 $              $ 
 
Revenue                                        2           743,138      1,530,008 
 
Exploration expenses                                   (5,503,328)       (18,690) 
Project evaluation                                       (856,589)      (581,739) 
Administration expenses                                  (901,283)      (944,353) 
Foreign exchange gains                                   1,792,826            839 
Mt Leyshon holding costs                                  (46,204)      (122,672) 
 
Loss before tax                                        (4,771,440)      (136,607) 
 
Income tax expense                                        (10,603)      (196,749) 
                                                    --------------  ------------- 
 
  Loss for the period                                  (4,782,043)      (333,356) 
                                                    --------------  ------------- 
 
Other comprehensive income, net of 
 income tax 
Items that may be reclassified subsequently 
 to profit and loss: 
Exchange differences on translating 
 foreign operations                                    (5,348,272)       (34,626) 
                                                    --------------  ------------- 
 
  Other comprehensive income for the 
  period net of tax                                    (5,348,272)       (34,626) 
                                                    --------------  ------------- 
 
  Total comprehensive income for the 
  period                                              (10,130,315)      (367,982) 
                                                    ==============  ============= 
 
  Loss attributable to members of Leyshon 
  Resources Limited                                    (4,782,043)      (333,356) 
                                                    ==============  ============= 
 
  Total comprehensive income attributable 
  to members of Leyshon Resources Limited             (10,130,315)      (367,982) 
                                                    ==============  ============= 
 
 
Loss Per Share 
Basic (cents per share)                                      (1.9)          (0.1) 
Diluted (cents per share)                                    (1.9)          (0.1) 
 
 

The above Condensed Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes. All amounts presented in respect of prior periods have been restated to reflect the change in presentation currency as set out in the accounting policies.

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2013

 
                                  Note  30 June 2013    31 Dec 2012 
                                                   $              $ 
 
ASSETS 
Current Assets 
Cash and cash equivalents                 40,062,039     47,253,874 
Trade and other receivables        3         187,473        674,828 
Other assets                                  61,120         67,188 
                                        ------------   ------------ 
 
  Total Current Assets                    40,310,632     47,995,890 
                                        ------------   ------------ 
 
Non-Current Assets 
 
Other financial assets                        13,699         15,557 
Property, plant and equipment                241,840        229,983 
Exploration & evaluation assets            4,860,025      5,519,320 
 
  Total Non-Current Assets                 5,115,564      5,764,860 
                                        ------------   ------------ 
 
TOTAL ASSETS                              45,426,196     53,760,750 
                                        ------------   ------------ 
 
LIABILITIES 
Current Liabilities 
Trade and other payables           4       6,501,069      3,266,105 
Current tax liabilities                       19,384        188,765 
Provisions                                    92,933        104,261 
                                        ------------   ------------ 
 
  Total Current Liabilities                6,613,386      3,559,131 
                                        ------------   ------------ 
 
Non-Current Liabilities 
Trade and other payables           4               -      1,106,349 
Deferred tax liability                                    1,273,689 
                                           1,121,544           ,689 
 
  Total Non-Current Liabilities            1,121,544      2,380,038 
                                        ------------   ------------ 
 
TOTAL LIABILITIES                          7,734,930      5,939,169 
                                        ------------   ------------ 
 
NET ASSETS                                37,691,266     47,821,581 
                                        ============   ============ 
 
EQUITY 
Issued capital                     5      57,071,050     57,071,050 
Reserves                           6       3,285,967      8,634,239 
Accumulated losses                      (22,665,751)   (17,883,708) 
                                        ------------   ------------ 
 
TOTAL EQUITY                              37,691,266     47,821,581 
                                        ============   ============ 
 

The above Condensed Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes. All amounts presented in respect of prior periods have been restated to reflect the change in presentation currency as set out in the accounting policies.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE HALF-YEAR ENDED 30 JUNE 2013

 
                                         Foreign 
                             Issued      exchange   Accumulated 
                             Capital     reserve       losses        Total 
                               $            $            $             $ 
 Balance at 1 January 
  2012                     56,608,151   7,469,667   (13,168,843)   50,908,975 
                          -----------  ----------  -------------  ----------- 
 Loss for the period                -           -      (333,356)    (333,356) 
 Exchange differences 
  on translation of 
  foreign operations                -    (34,626)              -     (34,626) 
                          -----------  ----------  -------------  ----------- 
 Total comprehensive 
  income for the period             -    (34,626)      (333,356)    (367,982) 
                          -----------  ----------  -------------  ----------- 
 Buy back of shares         (440,938)           -              -    (440,938) 
 Balance at 30 June 
  2012                     56,167,213   7,435,041   (13,502,199)   50,100,055 
                          -----------  ----------  -------------  ----------- 
 
 
 Balance at 1 January 
  2013                     57,071,050     8,634,239   (17,883,708)     47,821,581 
                          -----------  ------------  -------------  ------------- 
 Loss for the period                -             -    (4,782,043)    (4,782,043) 
 Exchange differences 
  on translation of 
  foreign operations                -   (5,348,272)              -    (5,348,272) 
 Total comprehensive 
  income for the period             -   (5,348,272)    (4,782,043)   (10,130,315) 
                          -----------  ------------  -------------  ------------- 
 Balance at 30 June 
  2013                     57,071,050     3,285,967   (22,665,751)     37,691,266 
                          -----------  ------------  -------------  ------------- 
 

The above Condensed Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes. All amounts presented in respect of prior periods have been restated to reflect the change in presentation currency as set out in the accounting policies.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE HALF-YEAR ENDED 30 JUNE 2013

 
                                                    Half-year       Half-year 
                                                        ended           ended 
                                                 30 June 2013    30 June 2012 
                                                            $               $ 
 
CASH FLOWS FROM OPERATING ACTIVITIES 
 
 
Payments to suppliers and employees               (3,246,541)     (1,448,955) 
Mt Leyshon holding costs                            (534,952)       (255,492) 
Income tax paid                                     (173,557)       (329,187) 
Interest received                                   1,246,417       1,301,832 
 
 
 
  Net cash flows used in operating 
  activities                                      (2,708,633)       (731,802) 
                                                                ------------- 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES 
 
Acquisition of plant and equipment                  (109,377)         (2,728) 
 
 
  Net cash flows used in investing 
  activities                                        (109,377)         (2,728) 
                                                -------------   ------------- 
 
 
CASH FLOWS FROM FINANCING ACTIVITIES 
 
Payment for buy-back of shares                              -       (436,244) 
Share transaction costs                                     -         (4,694) 
 
  Net cash flows used in investing 
  activities                                                -       (440,938) 
                                                -------------   ------------- 
 
 
 
NET DECREASE IN CASH AND CASH EQUIVALENTS         (2,818,010)     (1,175,468) 
 
Cash and cash equivalents at the 
 beginning of the period                           47,253,874      53,258,342 
Effects of exchange rate changes 
 on cash and cash equivalents                     (4,373,825)       (246,698) 
 
 
  CASH AND CASH EQUIVALENTS AT THE 
  END OF THE PERIOD                                40,062,039      51,836,176 
 
 

The above Condensed Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes. All amounts presented in respect of prior periods have been restated to reflect the change in presentation currency as set out in the accounting policies.

   1.            SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

This general purpose financial report for the interim half-year reporting period ended 30 June 2013 has been prepared in accordance with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Act 2001. Compliance with AASB 134 ensures compliance with International Financial Reporting Standard IAS 34 Interim Financial Reporting.

This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report of Leyshon Resources Limited for the six months ended 31 December 2012 and any public announcements made by Leyshon Resources Limited and its subsidiaries during the interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.

(a) Basis of preparation of half-year financial report

The condensed consolidated financial statements have been prepared on the basis of historical cost, except for the revaluation of certain non-current assets and financial instruments. Cost is based on the fair values of the consideration given in exchange for assets. All amounts are presented in Australian dollars.

The accounting policies and methods of computation adopted in the preparation of the half-year financial report are consistent with those adopted and disclosed in the Company's December 2012 financial report for the six months ended 31 December 2012, other than as discussed below.

Adoption of new and revised Accounting Standards

In the current period, the Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to its operations and effective for reporting periods beginning on 1 January 2013.

The following new and revised Standards and Interpretations have been adopted in the current period:

   --      AASB 10 'Consolidated Financial Statements' 
   --      AASB 11 'Joint Arrangements' 
   --      AASB 12 'Disclosure of Interests in Other Entities' 
   --      AASB 127 'Separate Financial Statements' (2011) 
   --      AASB 128 'Investments in Associates and Joint Ventures' (2011) 

-- AASB 2011-7 'Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards'

-- AASB 13 'Fair Value Measurement' and AASB 2011-8 'Amendments to Australian Accounting Standards arising from AASB 13'

-- AASB 119 'Employee Benefits' (2011), AASB 2011-10 'Amendments to Australian Accounting Standards arising from AASB 119 (2011)'

   --      AASB 2011-9 'Amendments to Australian Accounting Standards - Presentation of Items of Other Comprehensive Income' 

-- AASB 2012-2 'Amendments to Australian Accounting Standards - Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to AASB 7)'

-- AASB 2012-2 'Amendments to Australian Accounting Standards - Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to AASB 7)'

-- AASB 2012-5 'Amendments to Australian Accounting Standards arising from Annual Improvements 2009-2011 Cycle'

-- AASB 2012-6 'Amendments to Australian Accounting Standards - Mandatory Effective Date of AASB 9 and Transition Disclosures'

The adoption of these standards and interpretations has resulted in a change to the Group's presentation of, or disclosure in, the financial statements but did not have any effect on the financial position or performance of the Group.

The Group has not elected to early adopt any new standards or amendments.

   1.            SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) 

Change in reporting currency

Effective 1 January 2013, the Company changed its presentation currency from Australian dollars (AUD$) to United States dollars (US$). The change in presentation currency is to better reflect the Company's business activities and to improve investors' ability to compare the Company's financial results with other publicly traded businesses in the industry. Prior to 1 January 2013, the Company reported its financial statements in AUD$. A change in presentation currency is a change in accounting policy which is accounted for retrospectively. In making this change in presentation currency, the Company followed the recommendations set out in AASB 121 "The Effects of Change in Foreign Exchange Rates" ("AASB 121"). In accordance with AABS 121, the financial statements for all periods presented have been translated into the new presentation currency using the current rate method. Under this method, the consolidated statement of Profit or Loss and other comprehensive income and the consolidated statement of cash flows for each period have been translated into the presentation currency using the average exchange rates prevailing during each reporting period. All assets and liabilities have been translated using the exchange rate prevailing at the consolidated balance sheets dates. Shareholders' equity transactions have been translated using the rates of exchange in effect as of the dates of the various capital transactions, while shareholders' equity balances from the translation are included as a separate component of other comprehensive income. All resulting exchange differences arising from the translation are included as a separate component of other comprehensive income. All comparative financial information has been restated to reflect the Company's results as if they had been historically reported in US$ and the effect on the consolidated financial statements resulted in an accumulated other comprehensive income adjustment which increased the Foreign exchange reserve to $7.5 million at 1 January 2012.

 
                                              Half-Year   Half-Year 
                                                  Ended       Ended 
                                                30 June     30 June 
                                                   2013        2012 
                                                      $           $ 
 
   2. REVENUE 
 
 Revenue consisted of the following items: 
 
 Interest received/receivable                   743,138   1,530,008 
 Total revenue                                  743,138   1,530,008 
                                             ----------  ---------- 
 
 
 
                                   30 June    31 Dec 
                                      2013      2012 
 3. TRADE AND OTHER RECEIVABLES          $         $ 
 Current 
 Amounts relating to: 
 - interest receivable                   -   515,007 
 - other (1)                       187,473   159,821 
                                  --------  -------- 
                                   187,473   674,828 
                                  ========  ======== 
 
   (1)           Other receivables comprise office rent security deposits and staff expense advances. 
 
 
 
 
                                                           30 June        31 Dec 
   4. TRADE AND OTHER PAYABLES                                2013          2012 
                                                                 $             $ 
 Current 
 Trade creditors                                         1,094,066       250,754 
 Accruals                                                4,416,922     2,497,169 
 Mt Leyshon Compensation Agreements                        990,081       518,182 
                                                      ------------  ------------ 
 
                                                         6,501,069     3,266,105 
                                                      ============  ============ 
 
 Non-Current 
 Mt Leyshon Compensation Agreements                              -     1,106,349 
                                                      ------------  ------------ 
 
                                                                 -     1,106,349 
                                                      ============  ============ 
 
 
 

Trade creditors represent liabilities for goods and services provided to the Group prior to the end of the financial period which are unpaid. The amounts are unsecured and non-interest bearing with average payment terms of 30 days.

Amounts due in relation to the Mt Leyshon compensation agreements are held as amortised cost.

   5.   ISSUANCES, REPURCHASES AND REPAYMENTS OF EQUITY SECURITIES 

There were no movements in ordinary share capital or other issued share capital of the Company during the current half-year reporting period (2012: The Company bought and subsequently cancelled, 2,214,341 ordinary shares in an on-market share buyback at an average price of $0.193 per share).

During the half-year reporting period, there were no movements in options over ordinary shares (2012: nil).

 
                                           30 June      31 Dec 
                                              2013        2012 
 6. RESERVES                                     $           $ 
 
 Foreign currency translation reserve    3,285,967   8,634,239 
                                         3,285,967   8,634,239 
                                        ----------  ---------- 
 
 

Movement in reserves

The movement in each of the reserves has been set out in the Statement of Changes in Equity.

Nature and purpose of reserves

Foreign currency translation reserve

Exchange differences arising on translation of the foreign controlled entity are taken to the foreign currency translation reserve. The accumulated exchange difference is recognised in profit and loss when the net investment is disposed of.

7. DIVIDENDS PAID OR PROVIDED FOR

No dividends have been paid or provided for during the half-year (June 2012: nil).

 
 
   8. COMMITMENTS FOR EXPENDITURE AND CONTINGENT LIABILITIES 
 
 

The Group had commitments for expenditure of approximately $1,110,000 at 30 June 2013 (31 December 2012: nil) in relation to drilling and testing of well ZJS7 under its exploration and appraisal programme announced in January 2013 for its Zijinshan Gas Project.

There has been no material change in the contingent assets or liabilities of the Consolidated Entity during the half-year.

 
9. LEASE COMMITMENTS 
 
Operating leases 
Leasing arrangements 
The operating leases relate to the lease of an office in Beijing, 
 China and an office in Perth, Australia. The current lease in 
 Beijing is for a period of two years commencing 1 November 2012 
 and the lease in Perth is for a period of 1 year commencing 
 1 September 2013. The Group does not have an option to acquire 
 the leased assets at the expiry of the lease period. 
 
                                                                31 Dec 
                                                      30 June 
                                                         2013     2012 
                                                            $        $ 
Non-cancellable operating leases 
Not longer than 1 year                                379,236  355,046 
Longer than 1 year and not longer than 5 years         63,206  261,215 
Longer than 5 years                                         -        - 
                                                     --------  ------- 
                                                      442,442  616,261 
                                                     ========  ======= 
 

10. SEGMENT INFORMATION

The Group currently has only one operating segment, being the exploration for unconventional gas in China. The Group has non-current exploration and evaluation assets of $4,860,025 (31 December 2012: $5,519,320) and property, plant and equipment of $241,840 (31 December 2012: $229,983) located in China. All other non-current assets are located in Australia.

11. SUBSEQUENT EVENTS AFTER BALANCE DATE

On 13 September 2013, the Company announced that it would seek shareholder and regulatory approvals to undertake a corporate restructure to effect the separation of its energy and mineral businesses.

The restructure would involve demerger of the Company's energy assets, including the Company's interests in the Zijinshan Gas Project along with cash reserves of US$35 million, into an energy focussed vehicle, Leyshon Energy Limited (Leyshon Energy). The demerger will be effected via a pro--rata in--specie distribution of 100% of shares in Leyshon Energy to the Company's shareholders.

11. SUBSEQUENT EVENTS AFTER BALANCE DATE (Continued)

Immediately following implementation of the energy separation, Leyshon Energy intends to apply for listing on the ASX and has appointed Cantor Fitzgerald Limited as its Nominated Adviser to assist with an application for admission to trading on AIM.

The overall financial impact on the Group should the demerger proceed is to:

   --      reduce cash and cash equivalents by $36.0 million, 
   --      reduce other current and non-current assets by $5.2 million, and 
   --      reduce current and non-current liabilities by $7.2 million. 

The loss after tax for the half-year ending 30 June 2013 for the energy assets was $5.4m, which was primarily exploration expense.

The financial impact of the proposed demerger and distribution to owners has not been incorporated into these financial statements.

There were no other significant events occurring after balance date requiring disclosure in the financial statements.

This information is provided by RNS

The company news service from the London Stock Exchange

END

IR QQLBFXKFXBBL

Leyshon Resources (LSE:LRL)
Historical Stock Chart
From Jun 2024 to Jul 2024 Click Here for more Leyshon Resources Charts.
Leyshon Resources (LSE:LRL)
Historical Stock Chart
From Jul 2023 to Jul 2024 Click Here for more Leyshon Resources Charts.