Atlas African Industries reports turnover of US$63,000 and comprehensive losses of US$2.1million for the six months to the end of June. The company had cash and cash equivalents of US$1.7 million at the period end.
Turnover was $3.1m in the six months to the end of December 2014 and $3.1m in the 18 months to the end of December 2015.
Non-executive chairman Ian H. Mann said: "This has been a frustrating period for the Company and its shareholders.
"During the period, we initially made great strides forward to deliver on our strategy to take advantage of opportunities in the consumer industrial sector.
"We changed the name of the vompany to Atlas African Industries Limited, shifted our operational focus and raised US$5 million from new and existing shareholders to strengthen the balance sheet; through our Ethiopian subsidiary TEAP Glass PLC ('TEAP') we secured a 100 year land lease for our planned new state-of-the-art glass bottle manufacturing facility (the first 45 years of lease payments have been paid in advance) on a 5.5 acre site located in Chancho, in close proximity to established infrastructure and just 30 kilometres from intended mine sites for the majority of materials needed to produce high quality bottles.
"We appointed MH Engineering Plc, a leading Ethiopian firm, to conduct a full feasibility study, including architectural, engineering, structural, sanitary, electrical and mechanical design and quantity surveying services; we commenced ground clearing and geotechnical drilling on-site ahead of constructing ancillary buildings, and placed deposits on long lead items.
"The tangible potential of our Ethiopian project (the 'Chancho Project') was further underpinned by the signing of a memorandum of understanding with leading Ethiopian brewer Raya Brewery Share Company ('Raya'), with a view - subject to confirmation of quality - to entering into an offtake agreement to regularly supply international standard, high quality glass bottles to Raya in substitution of the imported bottles it currently uses.
"Preliminary economic studies had highlighted the strong potential of the Chancho Project based on a yearly production capacity of 105 million 330ml bottles, with full production targeted for early 2019.
"The Ethiopian Government has designated manufacturing as a top industrial priority with an emphasis on replacement of imports; the high-quality glass bottle market is currently dominated by expensive imports, so we identified our project as having huge benefit to all stakeholders, both the investors and Ethiopia.
"Success of the Chancho Project has the potential to generate significant revenue in tax to the Ethiopian Government as well as generate employment of 195 people in the area. Furthermore, we perceived significant ancillary benefits would be seen within associated businesses and supply chains.
"Despite these considerable efforts and the factors which suggested that the Chancho Project would generate positive impacts for the Company, its shareholders, the local community around Chancho and the Ethiopian Government through tax revenues, our progress has been undermined and derailed by the actions of the Ethiopian Revenue and Customs Authority ('ERCA').
"As shareholders will be aware from our announcement of 11 May 2016 we have been subjected to a complete injustice, through the summary removal of approximately US$2.4 million from TEAP's bank account with the Development Bank of Ethiopia by ERCA.
"ERCA's actions stem from a tax claim made against Ardan Risk & Support Services ('Ardan') which categorically relate to periods prior to Atlas' involvement with Ardan. Atlas has received legal advice that neither it nor TEAP has any liability for any such taxes under Ethiopian law.
"The Board continues in its fight to retrieve the expropriated funds and is pursing all legal, diplomatic and political channels in order to seek redress, including direct appeals to the Government of Ethiopia and the Ethiopian Investment Commission and through the UK Foreign Office and the British Business Secretary; our major shareholders have been actively lobbying the Canadian and US Governments."
At 9:34am: (LON:AAI) Atlas African Industries Limited Ord Npv share price was +0.01p at 0.12p