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Final Results

RNS Number : 4125U
African Potash Ltd
28 December 2012
 



African Potash Limited / Index: AIM / Epic: AFPO / Sector: Mining

28 December 2012

African Potash Limited ('African Potash' or 'the Company')

Final Results

 

African Potash Limited, the AIM listed African exploration company, is pleased to announce it final results for the year ended 30 June 2012.  Copies of the Annual Report and Accounts for the year ended 30 June 2012 will be posted to shareholders today and will also be available on the Company's website at www.africanpotash.com by 31 December 2012.

 

Chairman's Statement:

 

African Potash was established in 2011 as a dedicated vehicle focused on investing in or acquiring potash assets in Sub-Saharan Africa.  The Board's plan is to take advantage of the long term growth fundamentals of potash and the increasing demand for potash from the agricultural sector.  Following admission to trading on AIM in September 2011 and the raising of approximately $10.9m through two equity fundraisings, each at 5p per share, the Company has concentrated on its strategy to review, acquire and advance targeted assets that met the criteria of our investment policy. 

 

In line with this strategy, on 3 February 2012 the Company entered into a conditional share purchase agreement ('SPA') to acquire the entire issued share capital of Patagonia Capital Limited ('Patagonia'), a Mauritian company which holds a 70% interest in La Societe des Potasses et des Mines S.A. ('SPM'), a company incorporated in the Republic of Congo for the purpose of mineral exploration.  The SPA was conditional, inter alia, on shareholder approval and a permis de recherches (the 'Permis de Recherches') being granted to SPM by the Government of the Republic of Congo in respect of the Lake Dinga area of the Republic of Congo.

 

As shareholders will be aware there were significant, unexpected delays to the grant of the Permis de Recherches, despite preliminary approval and recommendation by the Minister of Mines.  When, in October 2012, it became apparent that the Permis de Recherches would not be granted prior to the contractual long stop date, the SPA was terminated.  As we announced in October, the principal factors which caused the delay were outside the control of SPM and Patagonia, including the Congo national Parliamentary elections which took place on 15 July 2012. 

 

The Board is actively seeking to conclude an acquisition in the near term and I look forward to updating shareholders shortly.  I'd like to thank shareholders for their patience.  The Board continues to believe that potash is a commodity with attractive commercial attributes and we look forward to reporting on further progress towards the establishment of a dedicated potash business and the creation of long term significant shareholder value.

 

Edward Marlow

Chairman & CEO

27 December 2012

 

For further information visit www.africanpotash.com or contact the following:

Ed Marlow

African Potash Limited

+44 (0) 20 7408 9200      

Jonathan Wright

Seymour Pierce Limited

+44 (0) 20 7107 8000      

David Foreman

Seymour Pierce Limited

+44 (0) 20 7107 8000      

Richard Greenfield

GMP Securities Europe LLP

+44 (0) 20 7647 2836      

Susie Geliher

St Brides Media and Finance Ltd

+44 (0) 20 7236 1177      

 

STATEMENT OF COMPREHENSIVE INCOME

For the period ended 30 June 2012

 

 

 





Period

ended

30 June






2012


Note




$'000













Operating expenses





(2,810)







Operating loss





(2,810)







Finance income





16







Loss before taxation





(2,794)







Income tax expense





-







Loss for the period and total comprehensive income for the period





(2,794)







Loss per share






- Basic and diluted (cents)

4




(1.6c)







 



 

STATEMENT OF FINANCIAL POSITION

As at 30 June 2012

 






2012


Note




$'000







ASSETS






Non-current assets






Loans and receivables

5




-







Total non-current assets





-







Current assets






Trade and other receivables





33

Cash and cash equivalents





8,192

Total current assets





8,225







TOTAL ASSETS





8,225







LIABILITIES






Current liabilities






Trade and other payables





(108)







NET ASSETS





8,117







EQUITY






Issued capital

6




10,911

Retained earnings





(2,794)






TOTAL EQUITY




8,117


STATEMENT OF CHANGES IN EQUITY

For the period ended 30 June 2012

 

Share capital

$'000

Retained earnings

$'000

Total

 

$'000

Balances at 11 August 2011

-

-

-





Loss for the period

-

(2,794)

(2,794)





Total comprehensive income for the period

 

-

(2,794)

(2,794)

Transactions with owners




Share issues

10,911

-

10,911





Total transactions with owners

10,911

-

10,911

Balances at 30 June 2012

10,911

(2,794)

8,117

 

 


CASH FLOW STATEMENT

For the period ended 30 June 2012






Period ended

30 June






2012






$'000







Operating activities






Loss before tax





(2,794)

Adjustments for:






- Impairment of loans and receivables





1,441

- Interest income





(16)

Operating cash flow before movements in working capital



(1,369)

Working capital adjustments:






- Increase in receivables    





(33)

- Increase in payables





108







Cash used in operations





(1,294)

Interest received





16







Net cash used in operating activities





(1,278)













Investing activities






Advance of loans and receivables





(1,441)







Net cash used in investing activities





(1,441)







Financing activities






Proceeds from issue of share capital





10,911







Net cash from financing activities





10,911







Net increase in cash and cash equivalents




8,192







Cash and cash equivalents at start of the period





-







Cash and cash equivalents at end of the period





8,192

 

 



 

NOTES TO THE FINANCIAL STATEMENTS

For the period ended 30 June 2012

 

1.     General Information

 

African Potash Limited is incorporated and domiciled in Guernsey.  The nature of the Company's operations and its principal activities are set out in the Chairman's Statement.

 

The presentational currency of the Company is US Dollars as this reflects the Company's business activities in the resource exploration sector in sub-Saharan Africa and therefore the Company's financial position and financial performance.

 

The financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union. 

 

The financial statements for the year ended 30 June 2012 have been reported on by the Group's auditors and contain an unqualified opinion.

 

The full audit report is contained in the Company's Annual Report, which will be available on the Company's website by 31 December 2012.

 

2. Critical accounting estimates and judgments

 

The preparation of financial statements in conformity with IFRS as adopted in the EU requires the use of certain critical accounting estimates.  It also requires management to exercise its judgement in the process of applying the Company's accounting policies.  The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period are discussed below.

 

Loans and receivables

The Company has reviewed the recoverability of its loan receivable and considers, as the acquisition of Patagonia Capital Limited ("Patagonia") did not proceed, that, as at the date of these financial statements, there are indications of impairment.  Accordingly an impairment provision for the loan balance has been made. .

 

Going concern

The board has prepared forecasts for the Company covering the period of 12 months from the date of approval of these financial statements. 

 

The directors believe that, the Company is well placed to manage its business risks successfully despite the current uncertain economic outlook.  The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

 

3. Segment reporting

 

As set out in the operating review, the directors consider that the Company's is an investment company and operates in one geographical segment, Africa. 

 

4. Earnings per share

 

The calculation of the basic and diluted earnings per share is based on the following data:

 




2012




$'000





Loss for the purposes of basic earnings per share



2,794





Number of shares








Weighted average number of ordinary shares for the purposes of basic and diluted loss per share



174,357,632





Loss per share



(1.6c)

 

No options or instruments which might give rise to dilution were in issue during the year.

 

5. Financial assets

 



Loans and

Receivables

 

Total

30 June 2012




$'000

$'000







Non-current assets






Loans and receivables




1,441

1,441

Provision for impairment




(1,441)

(1,441)





-

-







Current assets






Other receivables




33

33

Cash and cash equivalents




8,192

8,192




8,225

8,225

 

The non-current asset is a loan to Patagonia which holds a 70% interest in Societe des Potasses et des Mines S.A. ("SPM").  On 3 February 2012, the Company entered into a conditional share purchase agreement ('SPA') to acquire the entire issued share capital of Patagonia.  The SPA was conditional, inter alia, on a permis de recherches (the 'Permis de Recherches') being granted to SPM by the Government of the Republic of Congo.  As shareholders will be aware, there were significant, unexpected delays to the grant of the Permis de Recherches.  When, in October 2012, it became apparent that the Permis de Recherches would not be granted prior to the contractual long stop date, the SPA was terminated.  The loan was to fund the working capital requirements of Patagonia and SPM up to the completion of the acquisition of Patagonia.  Accordingly, as at the date of these financial statements, the Company considers the loan to be fully impaired.

 

Cash balances include $59,000 of restricted cash relating to cash held on deposit as security for credit card expenditure.

 

The directors consider that the carrying amount of financial assets approximates their fair value.  There are no significant amounts past due.

 

6. Share capital



Allotted and fully paid

Ordinary shares of no par value


Number

$'000





At 11 August 2011




Issue of shares


198,700,000

10,911

At 30 June 201121


198,700,000

10,911

 

The Company has one class of ordinary share which carries no right to fixed income.

 

Between incorporation and 23 September 2011, 40 million ordinary shares were issued for cash at a price of 0.1p per ordinary share and 35 million ordinary shares were issued for cash at a price of 2p per ordinary share.

 

On 30 September 2011, 83.7 million ordinary shares were issued for cash at a price of 5p per ordinary share.

 

On 4 November 2011, 40 million ordinary shares were issued for cash at a price of 5p per ordinary share.

 

No share options or warrants were issued during the period.

 

 

**ENDS**

 

 

 

 

 

 


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