LEED RESOURCES PLC RNS Number : 6195T Leed Resources PLC 31 March 2016
("Leed" or "the Company")
Leed Resources plc, (AIM: LDP), the natural resource investment company, is pleased to announce its un-audited results for the six months ended 31 December 2015.
Chairman's statementI am pleased to present the half-yearly results for your company for the six months ended 31 December 2015. During the period, we increased our investment in the Western Australian limestone business, High Mannor ("HM"), through a participation in a further issue of secured convertible notes by Battalion International Ltd. ("Battalion"), which is the majority shareholder in HM. This has increased our investment in Battalion to A$1,680,000 (GBP 923,000) and, as with the initial investment, our investment is in secured convertible notes.
OPERATIONAL UPDATE
Operationally, the period was a frustrating time for HM as it initially experienced delays in the deliveries of the moulds for the new generation wall panels and then, following receipt, it was discovered that the dimensions of the moulds were marginally outside of acceptable tolerances. This meant that rectification work was required, leading to further delays in the production and market deliveries of wall panels.
However, HM completed these rectifications and began producing wall panels at its quarry, ready for commencement of deliveries to the market in early 2016. HM also received confirmation in December 2015, from the Australian Patent Office, that all of its patent applications had been approved.
SUBSEQUENT EVENTS
Since the end of the period there have been significant operational and corporate developments for Leed. From an operational standpoint, the first commercial deliveries of the new wall panels were successfully undertaken by HM in late January 2016. Subsequent interest in further panel deliveries by a number of HM customers support our belief that the wall panels can establish a very significant market presence and be a highly profitable business for HM.
The Company's ordinary shares were suspended from trading on AIM on 12 February 2016, due to the fact that the Company had not implemented its investing policy as approved at the general meeting on 12 February 2015. Whilst your Board has obviously been aware of this risk, it was felt that the operational delays at HM meant that it was not in the interest of the Leed shareholders to attempt to prematurely enter into any transaction. However, as announced on 15 February 2016, Leed has entered into a non-binding heads of terms agreement ("Heads of Terms"), which provides for exclusivity and includes an option to acquire up to 100% of Battalion, the majority shareholder of HM.
Following the signature of the Heads of Terms, Leed commenced a period of detailed due diligence. During the course of this due diligence, it has been discovered that a senior member
of HM staff, who has since been dismissed and reported to the police, had been involved in fraudulent activities which has resulted in losses for the HM business. During the next couple of months, Leed will ascertain the impact of these fraudulent activities and any other operational issues, on the current value of the HM business and as part of this will consider the potential need to amend the terms of any transaction with Battalion, as provided for in the Heads of Terms.
HM has previously relied on alternative sources of working capital finance to fund the gap between production and payment for the blocks and panels. These sources of financing have now expired and accordingly, Leed has agreed to contribute A$250,000 to a short term working capital facility along with two other Battalion loan noteholders, which will accrue interest at a rate of 12% per annum. The loan will be secured against trade receivables and stock held at the quarrying and processing site of HM.
We will continue to update shareholders on a timely basis and your Board would like to thank you for your continued patience and support.
31 March 2016
for the six months ended 31 December 2015
Six months ended 31 Dec 2015 | Six months ended 31 Dec 2014 | Year ended 30 Jun 2015 | ||
Note | £000 | £000 | £000 | |
Continuing operations | ||||
Net gain/(loss) on investments | 13 | - | (62) | |
Investment income | 49 | 4 | 39 | |
62 | 4 | (23) | ||
Administrative expenses | (98) | (104) | (201) | |
Share based payments | - | - | (67 | |
Loss before taxation | (36) | (100) | (291) | |
Taxation | - | - | - | |
Total comprehensive loss for the period | (36) | (100) | (291) | |
Loss per share (pence) | 3 | |||
Basic and diluted | (0.001p) | (0.001p) | (0.001p) | |
for the six months ended 31 December 2015
Share | Share | Option & warrant | Retained | ||
capital | premium | reserve | earnings | Total | |
£000 | £000 | £000 | £000 | £000 | |
Total owners' equity at 30 June 2014 | 36,838 | 77,101 | - | (112,415) | 1,524 |
Transactions with owners: | |||||
- Share capital issued by Company | - | - | - | - | - |
- Share issue costs | - | - | - | - | - |
Total transactions with owners | - | - | - | - | - |
- Comprehensive loss: | |||||
- Loss for the period | - | - | - | (100) | (100) |
Total comprehensive loss for the period | - | - | - | (100) | (100) |
Total owners' equity at 31 December 2014 | 36,838 | 77,101 | - | (112,515) | 1,424 |
Transactions with owners: | |||||
- Share based payment expense | - | - | 67 | - | 67 |
Total transactions with owners | - | - | 67 | - | 67 |
Comprehensive loss: | |||||
- Loss for the period | - | - | - | (191) | (191) |
Total comprehensive loss for the period | - | - | - | (191) | (191) |
Total owners' equity at 30 June 2015 | 36,838 | 77,101 | 67 | (112,706) | 1,300 |
Transactions with owners: | |||||
- Share capital issued by the Company | 33 | - | - | - | 33 |
Total transactions with owners | 33 | - | - | - | 33 |
Comprehensive loss: | |||||
- Loss for the period | - | - | - | (36) | (36) |
Total comprehensive loss for the period | - | - | - | (36) | (36) |
Total owners' equity at 31 December 2015 | 36,871 | 77,101 | 67 | (112,742) | 1,297 |
Leed Resources plc issued this content on 31 March 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 31 March 2016 07:41:35 UTC
Original Document: http://www.leedresourcesplc.com/announcements/31032016 Half-Yearly Report.pdf
