Source - RNS
RNS Number : 1331K
Andes Energia PLC
19 September 2016
 

 19 September 2016

 

 

ANDES ENERGIA PLC

("Andes" or the "Company" or with its subsidiaries the "Group")

 

UNAUDITED INTERIM RESULTS TO 30 JUNE 2016

 

Andes (AIM: AEN; BCBA: AEN), the Latin American E&P group, announces its unaudited interim results for the six month period ending 30 June 2016.

 

Operational Review

 

Period highlights

 

·              6% increase in average daily production from 3,287* boepd in the first six months of 2015 to 3,481* boepd in the first six months of 2016

·              Average oil production of 2,322 bpd in Argentina; average net price received US$60.8/bbl

·              Average oil production of 695 bpd in Colombia; average net price received US$33.3/bbl

·              Average gas production of 464 boepd in Colombia; average price received US$19.6/boe (US$2.89MBTU)

·              44 development wells drilled on the Chachahuen licence in Argentina, in partnership with YPF, all successfully brought into production

·              4 exploration wells drilled on the Chachahuen licence of which 3 are located in the Chachahuen Sur block and 1 in the Chachahuen Centro block

·              Revenues of US$34.2 million for the six months ending 30 June 2016 compared to US$32.5 million for the corresponding period last year; an increase of 5%

·              EBITDA of US$7.7 million for the six months ending 30 June 2016 compared to US$5.5** million for the corresponding period last year; an increase of 40%

·              Half year end oil prices being received: Argentina $61.3/bbl; Colombia $34.1/bbl

 

Post period highlights

 

·              A further 15 development wells drilled on the Chachahuen licence, all now producing

·              Ongoing well testing of 2 Chachahuen exploration wells

·              1 exploration well "Cerro Morado Este x-1" was spudded on 5 July with the main target to investigate the Centenario formation and is currently under extended production testing

·              Discussions ongoing with YPF regarding new Development Program at Chachahuen for the next 2-3 years

 

Alejandro Jotayan, CEO, commented:

 

"Andes continues to grow through the development of its assets and in particular the development of the Chachahuen licence, which has driven production higher against a backdrop of higher domestic oil prices compared to international prices.  Furthermore, the new government is stimulating activity in Argentina, which we believe will lead to new and increased investment in the country and help drive value from our 250,000 net acres in the Vaca Muerta. "

 

*Includes 100% of Interoil's net production in which Andes holds a 26% indirect controlling interest

**Before exceptional item of US$1.3 million and one time settlement fee of US$4 million, to ensure consistency with 2015 comparatives

 

Enquiries:

 

Andes Energia plc

Nicolas Mallo Huergo, Chairman

Alejandro Jotayan, CEO

Billy Clegg, Head of Communications

 

T: +54 11 5530 9920

 

 

Stockdale Securities

Antonio Bossi

David Coaten

 

T: +44 20 7601 6100

Camarco

Gordon Poole

 

T: +44 20 3757 4980

Qualified Person Review

In accordance with AIM guidance for mining, oil and gas companies, Mr. Juan Carlos Esteban has reviewed the information contained in this announcement. Mr. Juan Carlos Esteban, an Officer of the Group, is a petroleum engineer with over 30 years of experience and is a member of the SPE (Society of Petroleum Engineers).

 

Note to Editors:

Andes Energia plc is an oil and gas exploration and production company focused on onshore assets in South America with a market capitalisation of circa £90m. The Company has its main operations in Argentina and Colombia.

 

The Company has approximately 25* MMbbls of conventional 2P reserves, and it also has certified prospective resources of 640 MMboe, primarily in the Vaca Muerta unconventional development in Argentina and over 7.5 million acres across South America.

 

The Company has approximately 250,000 net acres in the Vaca Muerta formation, which is the second largest shale oil deposit in the world and the only producing shale oil deposit outside of North America, currently producing 45,000 boepd. Over 300 wells have already been drilled and fracked in the Vaca Muerta formation.

 

Andes is the only AIM quoted company on the London Stock Exchange with exposure to the Vaca Muerta shale.

 

The Company currently produces approximately 3,525* boepd in Argentina and Colombia from six conventional fields in Argentina and two in Colombia, with positive cash flows generated.

 

 

*Includes 100% of Interoil's net reserves and production in which Andes holds a 26% indirect controlling interest



Chief Executive Officer's Review

 

Introduction

 

We have made significant progress in the first half of 2016 with 48 wells drilled, which has driven production higher.  In Argentina, we are receiving over $60 per barrel of oil produced.  The new pro-business administration is improving foreign capital inflows, some of which will be deployed in the oil industry and specifically the Vaca Muerta shale formation where we have 250,000 net acres.

 

Oil and Gas Interests

 

Production

 

Andes's production base is diverse. The Company now produces from 2 countries, from 8 oil fields and 269 wells.  Production in the period increased 6%, with average daily production of 3,481 boepd for the period compared to 3,287 boepd* in the first half of 2015.  Oil production in Argentina averaged 2,322 bpd, with average net prices of US$60.8/bbl; oil and gas production in Colombia averaged 1,159* boepd, with average oil net prices of US$33.3/bbl and gas average prices of US$19.6/boe (US$2.89MBTU).

 

Strategy

 

Andes has net 2P reserves of 25* MMbbls and certified resources of 640 MMboe mostly in the Vaca Muerta shale, where Andes holds 250,000 net acres in the oil window. We are making considerable progress in line with our stated strategy to develop our 2P reserve base to increase production and strengthen cash flows of the company so that capital can be deployed to convert resources into cash generating reserves and continue developing our acreage in the Vaca Muerta. 

 

Argentina

 

Chachahuen

 

Development drilling

 

The 2014-2016 Chachahuen development program, in joint venture with YPF, was accelerated in 2016, having up to 4 rigs working simultaneously in the field during the first half of the year. In the period 43 new producing wells were drilled and successfully completed. At the end of the period there were 133 wells on stream producing approximately 7,094 bpd (1,418 bpd net to Andes).

 

Enhanced Oil Recovery -Water Flood project

 

Under the ongoing water flood project 1 injector well was drilled during the period and 3 reconversions from producing into injection wells have been performed since the end of December 2015. At the half year end, Andes reached an average rate of injection of 2,332 bpd through a total of 21 injection wells.

 

Exploration drilling

Current production in Chachahuen comes from less than 5% of the total area of the licence and only one formation (Rayoso).  In order to expand the area and number of formations/horizons in production, Andes undertook a five well exploration program on certain prospects on the block with different targets and objectives.  Valuable information was obtained from the drilling, and two wells were chosen to carry out a long production test in the forthcoming weeks. The main technical results are as follows:

 

La Orilla x-1

The well is located approximately 17 km southeast of the first discovery well "Chus x-2", on the "Chachahuen Sur" evaluation block and was drilled to test a four-way closure structure at multiple horizons investigating the complete stratigraphic column, with the primary target the Centenario formation and the deeper Tordillo and Lotena formations the secondary targets. The Centenario formation occupies the eastern margin of the Neuquén Basin. The facies of this formation is fluvial/lacustrine, typical of the basin margin and these non-marine deposits interfinger with the marine formations of the upper part of the Mendoza Cycle and with the evaporitic facies of the Rayoso Cycle.

 

The well reached a total depth of 1,353 metres and encountered oil and gas shows in the lower Centenario, Tordillo and Lotena formations. During the completion stage, the deeper horizon of the Lotena formation (depth 1,266 metres) was tested for intermittent natural flows of gas and water, with the gas flared at the location. A production string was installed in order to perform extended well tests to define productivity. 

 

Remanso del Colorado x-1

The well is situated approximately 9.5 km southeast of the discovery well "Chus x-2" on the "Chachahuen Sur" evaluation block with the primary target to investigate the sandstone of cycle 1 of the Rayoso formation into the combined structural/stratigraphic traps where the updip seal is the claystones of the Neuquen Group above an unconformity.

 

The well was drilled to a total depth of 2,418 metres investigating the complete stratigraphic column. A comprehensive well test program was carried out testing separately the following formations: Rayoso, Agrio, Mulichinco, and an intrusive of the Vaca formation. Formation water was recovered from each one, whilst the deeper horizon of the Group Cuyo formation tested for natural flows of gas and water with the gas flared at the location. An extended well test is planned to define productivity.

 

Cerro Redondo x-1

The well is situated approximately 4.3 km northeast of the discovery well "Chus x-2" on the "Chachahuen Sur" evaluation block with the primary target to investigate the sandstone of cycle 1 of the Rayoso formation into the combined structural/stratigraphic traps where the updip seal is the claystones of the Neuquen Group above an unconformity.

 

The well was drilled to a total depth of 1,810 metres investigating the complete stratigraphic column. Oil shows were seen during the drilling process, and the shallow horizon encountered good quality reservoir sandstone with a net oil pay of 6 metres. The well was cased at a depth of 845 metres to test the Rayoso formation. After fracture stimulation the well produced by natural flow 135 bpd with a water cut of approximately 15%. A buildup test was performed to further evaluate the potential reservoir properties of cycle 1 of the Rayoso formation.

 

The well came on stream on 27 June and after an initial clean up period produced at a rate of 81 bpd. This oil discovery is currently flowing at 95 bpd.

 

An appraisal program and extensive follow-up exploration activities will now be considered targeting cycle 1 of the Rayoso formation.

 

Cerro Montoso x-1

The well is located approximately 37 km northeast of the discovery well "Chus x-2", on the "Chachahuen Centro" block and was drilled to test a three way closure against a bounding fault structure at multiple horizons with the primary target the lower Centenario formation and the deeper Tordillo formation the secondary target.

 

The well was drilled to a total depth of 980 metres.  Lost circulation was encountered whilst drilling and no oil shows were seen. The well was cased and formation water was recovered from the Centenario and Tordillo formations through swabbing. The well was subsequently plugged and abandoned. 

 

Oil production

 

Oil production increased 65%, from 4,235 bpd (847 bpd net to Andes) in the first semester of 2015 to 6,975 bpd (1,395 bpd net to Andes) in the first half of 2016, with 43 new producing wells drilled in the period. A total of 133 producing wells were on stream at the end of the period.

 

Puesto Pozo Cercado and Chañares Herrados blocks - Mendoza

Oil production decreased 7% during the period, from 1,645 bpd during the first half of 2015 (821 bpd net to Andes) to 1,533 bpd (765 bpd net to Andes) in the first six months of 2016.

 

Vega Grande - Mendoza

In Vega Grande oil production remained stable, going from 59 bpd during first semester of 2015 to 58 bpd in the first six months of 2016. Oil production was kept at the same level minimising oil production losses. The oilfield was kept operational during the whole winter season, despite severe climatic conditions. Andes holds a 100% working interest in the block.

 

La Brea (Puesto Muñoz) - Mendoza

In La Brea (Puesto Muñoz), oil production showed a minor decrease of 6 bpd, going from 61 bpd in 2015 first semester to 56 bpd during the first half of 2016. Production was kept at the same level through the application of acid stimulations in PMu.a-7 well. Andes holds a 100% working interest in the block.

 

El Manzano West (Agrio formation) - Mendoza

In El Manzano (Agrio formation), oil production decreased 31% during the period, falling from 44 bpd during the first semester of 2015 to 30 bpd in 2016 first half. Andes holds a 100% working interest in production from the Agrio Formation.

 

El Manzano West (Other formations) - Mendoza

In a joint venture with YPF, the licence's block operator, production from the El Manzano West block decreased 54% (total of 22 bpd), falling from 40 bpd during the first semester of 2015 to 18 bpd during 2016 first half. Andes holds a 40% working interest in production from all formations other than the Agrio formation, including Vaca Muerta.

 

Ñirihuau block - Chubut

Andes has fulfilled the work commitments agreed with the Chubut Province for the first exploration period and is currently awaiting the Province's approval for the proposed work program for the next exploration period.

 
Colombia

 

Andes has interests in 13 exploration licences and 2 producing licences including licences held through its 26% interest in Interoil.

 

Exploration licences

 

Andes is currently conducting regional geological studies, petrophysical interpretation and reprocessing of existing seismic data on its exploration licences in Colombia. In the YDND-2 block 300 soil gas samples were collected and another 300 soil gas samples were collected in the YDND-8 block. The sample analysis was conducted by GeoFrontiers laboratories and reports were submitted to the ANH. The exploration team is currently integrating and carrying out a technical evaluation of the geological, geochemical and geophysical data in order to define the prospectivity in these blocks.

 

In blocks LLA-2, LLA-28 and LLA-79, the Agencia Nacional de Hidrocarburos ("ANH") has approved the company's proposal to replace the seismic acquisition commitment with high density geochemical sampling.

 

In COR-6 a conciliation meeting was held on 26 May 2016 with the ANH to consider the extrajudicial conciliation petition filed by the company in respect of the COR-6 situation. Subject to Court approval, agreement has been reached with the ANH, pursuant to which Interoil has reached agreement with the ANH to transfer the COR-6 exploration commitments of US$22 million to the Altair and LLA-47 licences also held by the company. It should be noted that after the period end Interoil has been advised that the Court has not approved the agreement. The company is evaluating the implications of this decision and the different legal alternatives it has to protect its interest.

 

The commitments include:

 

1) High density geochemical sampling of 30,000 surface points to be completed by March 2017 with 10,000 samples (80 km²) to be taken on Altair and 20,000 samples (447 km²) on LLA-47.

2) Drilling of 1 stratigraphic well on the Altair licence to be completed by April 2018.

3) Drilling of 2 exploratory wells on the Altair licence to be completed by April 2018.

 

The company will be required to increase the guarantees on the Altair and LLA-47 licences consistent with these additional commitments.

 

Paraguay

 

Based on an analysis of the data collected and our strategy to prioritise low risk projects at a time of low international oil prices, Andes's Management has decided to relinquish the Itapua licence. 

 

Financial Highlights

 

Period ended 30 June

2016

2015

US$m

US$m

Revenue

34.2

32.5

Operating profit/(loss)

1.5

**(0.8)

EBITDA (see note 6)

7.7

**5.5

Net operating cash generated from operations

13.6

5.3

** Before exceptional item of US$1.3 million and one time settlement fee of US$4 million, to ensure consistency with 2015 comparatives

 

Revenue has increased to US$34.2 million for the first 6 month period of 2016 compared to US$32.5 million in the same period last year. Revenues from Andes's underlying operations excluding Interoil increased by 16% from US$22.7 million to US$26.3 million primarily from the increased production on the Chachahuen licence whilst Interoil's revenues fell by 19% from US$9.8 million to US$7.9 million primarily due to a fall in production and lower oil prices.

 

The group recorded an operating profit of US$1.5 million representing an increase of US$2.3 million compared to the 2015 operating loss of US$**0.8 million. This increase is derived primarily from Andes's operating activities excluding Interoil. Administrative costs in the period have fallen 37% compared to the comparative period last year.

 

EBITDA increased by 40% to US$7.7 million from US$5.5 million in the comparative period last year. Andes excluding Interoil contributed EBITDA of US$5.4 million compared to US$2.5 million in 2015, a 116% increase; Interoil EBITDA of US$2.3 million compared to US$3.0 million in 2015.

 

The net loss for the group increased from US$3.5 million for the comparative period in 2015 to US$9.2 million 2016. The main reasons for this resulted from an increase of US$0.9 million in finance costs; a decrease in finance income of US$2.2 million; and an increase in unrealised net exchange losses of US$ 3.9 million (a non-cash item) primarily resulting from the weakening of GBP against the US$ in relation to US$ denominated loans held by group companies with a functional currency of GBP.

 

The Group's total assets have decreased by US$75 million from US$318 million, at 30 June 2015 to US$243 million as at 30 June 2016 reflecting the impact of the devaluation of the Argentine Peso. The devaluation of the Argentine Peso resulted in US$56 million of exchange losses (a non-cash item) being recognised in comprehensive loss for the 12 months ending 30 June 2016.

 

At the period end the Group had cash resources of US$19.1 million compared to US$21.7 million at 30 June 2015, of which US$10.0 million is restricted as security for stand by letters of credit to support guarantees in Colombia compared to US$11.0 million at 30 June 2015.

 

Andes's borrowings fell by US$ 12.5 million, from US$ 65.4 to US$52.9 million, while Interoil, in which Andes holds a 26.01% interest, fell by US$1.4 million, from US$ 44.4 to US$43.0 million (which is ring fenced from the rest of the Group). It should also be noted that the majority of the finance costs of US$9.5 million are accrued costs with only US$0.9 million satisfied in cash during the period.

 

Outlook

 

The Board is pleased with the overall results delivered by the development program carried through in the Chachahuen licence. The team is currently in discussions with YPF regarding a possible new development program to be put in place, which will lead to another increase in production from this important field. The increased production rate and the successful ongoing water flood program in the Chachahuen licence, together with the reduction of production losses in other assets of the Company, augurs well for the future. The Company is pleased with the results of the latest exploration program on the Chachahuen block, which have opened the possibility to develop new horizons.

 

The business environment in Argentina is improving under the new pro-business administration.  Foreign capital is beginning to flow into the country and into the oil industry.  This trend augurs well for the future development of the vast Vaca Muerta shale formation; of which Andes has an interest in a very valuable 250,000 net acres.

 

Alejandro Jotayan

Chief Executive Officer

19 September 2016

*Includes 100% of Interoil's net reserves in which Andes holds a 26% indirect controlling interest



Group income statement for the period ended 30 June 2016

 


30-Jun-16

30-Jun-15

31-Dec-15

 US$'000

 US$'000

 US$'000

Revenue

34,195

32,488

66,815

Production cost

(26,008)

(22,608)

(45,705)

Gross profit

8,187

9,880

21,110

Other operating income

347

4,674

4,010

Exceptional items

-

1,309

-

Total other operating income

347

5,983

4,010

Distribution costs

(1,310)

(2,218)

(4,657)

Administrative expenses

(5,770)

(9,162)

(17,626)

Operating profit

1,454

4,483

2,837

Finance income

1,737

3,945

1,109

Finance costs

(9,523)

(8,625)

(18,272)

Exchange (loss)/gain

(3,204)

682

1,879

(Loss)/profit before taxation

(9,536)

485

(12,447)

Taxation

331

(3,979)

(5,938)

Loss for the year from continuing operations

(9,205)

(3,494)

(18,385)

Loss attributable to:

Equity holders of the parent

(8,878)

(3,756)

(15,226)

Non-controlling interests

(327)

262

(3,159)


(9,205)

(3,494)

(18,385)

Loss per ordinary share

 Cents

 Cents

 Cents

Adjusted basic and diluted loss per share

(1.47)

(0.92)

(2.68)

Basic and diluted loss per share

(1.47)

(0.68)

(2.68)

 

 

 



Consolidated statement of comprehensive income for the period ended 30 June 2016

 

30-Jun-16

30-Jun-15

31-Dec-15

US$'000

US$'000

US$'000

Loss for the period

(9,205)

(3,494)

(18,385)

Translation differences

(10,570)

(11,493)

(56,869)

Total comprehensive loss for the period

(19,775)

(14,987)

(75,254)

Total comprehensive loss attributable to:

Equity holders of the parent

(19,448)

(15,249)

(72,095)

Non-controlling interests

(327)

262

(3,159)


(19,775)

(14,987)

(75,254)

 

The loss on exchange results primarily from the revaluation of intangible assets and property, plant and equipment that are carried in Argentine pesos. This resulted in a drop in the carrying value of these intangible assets and property, plant and equipment but is not indicative of an impairment in value.

Consolidated statement of financial position as at 30 June 2016

 

30-Jun-16

30-Jun-15

31-Dec-15

US$'000

US$'000

US$'000

Non-current assets

Intangible assets

96,112

154,659

109,258

Property, plant and equipment

92,595

103,665

94,145

Available for sale financial assets

5,604

1,667

5,599

Trade and other receivables

9,828

10,932

10,039

Deferred income tax assets

1,111

1,041

1,547

Total non-current assets

205,250

271,964

220,588

Current assets

Inventories

1,113

1,813

1,954

Available for sale financial assets

1,223

3,782

1,414

Trade and other receivables

16,583

18,312

14,088

Restricted cash

9,087

10,713

9,593

Cash and cash equivalents

10,030

11,018

17,702

Total current assets

38,036

45,638

44,751

Current liabilities

Trade and other payables

30,990

27,591

22,644

Financial liabilities

18,373

25,726

22,259

Provisions

691

1,260

691

Total current liabilities

50,054

54,577

45,594

Non-current liabilities

Trade and other payables

17,123

8,434

18,169

Financial liabilities

77,534

84,120

76,767

Deferred income tax liabilities

31,099

44,553

38,005

Provisions

3,888

6,013

3,596

Total non-current liabilities

129,644

143,120

136,537

Net assets

63,588

119,905

83,208

Capital and reserves

Called up share capital

98,414

90,225

98,414

Share premium account

86,865

73,448

86,865

Other reserves

(136,993)

(81,047)

(126,423)

Retained earnings

12,962

31,109

21,685

Equity attributable to equity holders of the parent

61,248

113,735

80,541

Non-controlling interests

2,340

6,170

2,667

Total equity

63,588

119,905

83,208

 



Unaudited consolidated statement of changes in equity for the period ended 30 June 2016

 

Capital and reserves

Share

Share

Retained

Other

Attributable

Non

Total

capital

premium

earnings

reserves

to equity holders

controlling

of the parent

interests

US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

At 1 January 2015

90,164

73,248

34,700

(69,554)

128,558

-

128,558

Loss for the period

-

-

(3,756)

-

(3,756)

262

(3,494)

Translation differences

-

-

-

(11,493)

(11,493)

-

(11,493)

Total comprehensive loss for the period

-

-

(3,756)

(11,493)

(15,249)

262

(14,987)

Issue of ordinary shares

61

200

-

-

261

-

261

Fair value of share based payments

-

-

165

-

165

-

165

Acquisition of subsidiary

-

-

-

-

-

5,908

5,908

At 30 June 2015

90,225

73,448

31,109

(81,047)

113,735

6,170

119,905

Loss for the period

-

-

(11,470)

-

(11,470)

(3,421)

(14,891)

Translation differences

-

-

-

(45,376)

(45,376)

-

(45,376)

Total comprehensive loss for the period

-

-

(11,470)

(45,376)

(56,846)

(3,421)

(60,267)

Issue of ordinary shares

8,189

13,417

-

-

21,606

-

21,606

Fair value of share based payments

-

-

167

-

167

-

167

Acquisition of subsidiary

-

-

-

-

-

(1,255)

(1,255)

Reduction of interest in subsidiary

-

-

1,879

-

1,879

1,173

3,052

At 31 December 2015

98,414

86,865

21,685

(126,423)

80,541

2,667

83,208

Loss for the period

-

-

(8,878)

-

(8,878)

(327)

(9,205)

Translation differences

-

-

-

(10,570)

(10,570)

-

(10,570)

Total comprehensive loss for the period

-

-

(8,878)

(10,570)

(19,448)

(327)

(19,775)

Fair value of share based payments

-

-

155

-

155

-

155

At 30 June 2016

98,414

86,865

12,962

(136,993)

61,248

2,340

63,588

 

 

Other reserves

Merger

Warrant

Reverse

Translation

Deferred

Total

reserve

reserve

acquisition

reserve

Consideration

other

reserve

Reserve

reserves

US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

At 1 January 2015

55,487

2,105

-

(133,172)

6,026

(69,554)

Translation differences

-

-

-

(11,493)

-

(11,493)

Total comprehensive loss for the period

-

-

-

(11,493)

-

(11,493)

At 30 June 2015

55,487

2,105

-

(144,665)

6,026

(81,047)

Translation differences

-

-

-

(45,376)

-

(45,376)

Total comprehensive loss for the period


-

-

-

(45,376)

-

(45,376)

At 31 December 2015

55,487

2,105

-

(190,041)

6,026

(126,423)

Translation differences

-

-

-

(10,570)

-

(10,570)

Total comprehensive loss for the year

-

-

-

(10,570)

-

(10,570)

At 30 June 2016

55,487

2,105

-

(200,611)

6,026

(136,993)

 

 



Consolidated cash flow statement for the period ended 30 June 2016

 

30-Jun-16

30-Jun-15

31-Dec-15

US$'000

US$'000

US$'000

Cash generated from operations

13,941

5,781

18,751

Tax paid

(380)

(502)

(643)

Cash flows generated from operating activities

13,561

5,279

18,108

Cash flows from investing activities

Purchase of property, plant and equipment

(11,852)

(8,596)

(24,418)

Proceeds from sale of property, plant and equipment

6

-

17

Proceeds from sale of interest in subsidiary

-

-

814

Purchase of exploration assets

(846)

(425)

(2,233)

Purchase of financial assets

(738)

(2,318)

(6,402)

Acquisition of subsidiary net of cash acquired

-

16,863

12,018

Proceeds from sale of investments in group companies

-

-

3,128

Net cash used in /(generated from) investing activities

(13,430)

5,524

(17,076)

Cash flows from financing activities

Repayments of borrowings

(14,250)

(3,350)

(1,794)

Funds from borrowing

7,588

5,335

6,107

Interest paid

(872)

(1,943)

(837)

Interest received

1

18

392

Proceeds from issue of shares

-

261

12,315

Net cash (used in)/generated from financing activities

(7,533)

321

16,183

Exchange losses on cash and cash equivalents

(777)

(37)

(564)

Net (decrease)/increase in cash and cash equivalents

(8,179)

11,087

16,651

Cash and cash equivalents at the beginning of the period

27,296

10,644

10,644

Cash and cash equivalents at the end of the period

19,117

21,731

27,295

 

 

 

 

 



Notes

 

1.         Basis of preparation

 

The Group consolidates the financial statements of the Company and its subsidiary undertakings.

 

The financial information has been prepared under the historical cost convention in accordance with International Financial Reporting Standards (IFRSs). The financial information set out in this half-yearly report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. The same accounting policies, presentation and methods of computation are followed in this unaudited interim condensed consolidated report as were applied in the Group's annual financial statements for the year ended 31 December 2015. The auditor's report on those financial statements was unqualified and did not contain any statements under section 498(2) or section 498(3) of the Companies Act 2006.

 

2.         Segment reporting

 

2016


2015

Argentina

Colombia

Unallocated

Total

Argentina

Colombia

Unallocated

Total

Analysis of revenue and profit:

Corporate

Corporate


US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

Revenue

26,268

7,927

-

34,195

22,727

9,761

-

32,488

Operating profit/(loss)

2,429

555

(1,530)

1,454

1,390

7,241

(4,148)

4,483

Finance income

1,517

-

220

1,737

1,285

2,494

166

3,945

Finance costs

(4,352)

(453)

(4,718)

(9,523)

(2,208)

(3,586)

(2,831)

(8,625)

Exchange (loss)/gain

759

(133)

(3,830)

(3,204)

(12)

-

694

682

Loss before tax

353

(31)

(9,858)

(9,536)

455

6,149

(6,119)

485

Taxation

(1,339)

1,670

-

331

(516)

(3,463)

0

(3,979)

Loss for the year

(986)

1,639

(9,858)

(9,205)

(61)

2,686

(6,119)

(3,494)

Less: Exceptional gain on acquisition

-

-

-

-

-

-

(1,309)

(1,309)

Less: Settlement fee

-

-

-

-

-

(4,000)

-

(4,000)

Add: Depreciation and amortisation

3,655

2,611

-

6,266

4,408

1,920

-

6,328

Less: Finance income

(1,517)

-

(220)

(1,737)

(1,285)

(2,494)

(166)

(3,945)

Add: Finance costs

4,352

453

4,718

9,523

2,208

3,586

2,831

8,625

Add: Exchange gains and losses

(759)

133

3,830

3,204

12

-

(694)

(682)

Add: Tax

1,339

(1,670)

-

(331)

516

3,463

-

3,979

EBITDA

6,084

3,166

(1,530)

7,720

5,798

5,161

(5,457)

5,502

 

 

3.         Andes and Interoil

 


 Andes

 Interoil

 Group

 Andes

 Interoil

 Group


30-Jun-16

30-Jun-16

30-Jun-16

30-Jun-15

30-Jun-15

30-Jun-15

 US$'000

 US$'000

 US$'000

 US$'000

 US$'000

 US$'000

Revenue

26,268

7,927

34,195

22,727

9,761

32,488

Production cost

(21,119)

(4,889)

(26,008)

(17,747)

(4,861)

(22,608)

Gross profit

5,149

3,038

8,187

4,980

4,900

9,880

Other operating income

499

(152)

347

296

4,378

4,674

Exceptional gain

-

-

-

1,309

-

1,309

Distribution costs

(508)

(802)

(1,310)

(1,067)

(1,151)

(2,218)

Administrative expenses

(3,416)

(2,354)

(5,770)

(6,125)

(3,037)

(9,162)

Operating profit

1,724

(270)

1,454

(607)

5,090

4,483

Finance income

1,737

-

1,737

1,451

2,494

3,945

Finance costs

(7,814)

(1,709)

(9,523)

(5,039)

(3,586)

(8,625)

Exchange (loss)/exchange

(3,071)

(133)

(3,204)

682

-

682

Profit/(loss) before taxation

(7,424)

(2,112)

(9,536)

(3,513)

3,998

485

Taxation

(1,339)

1,670

331

(516)

(3,463)

(3,979)

Loss for the year from continuing operations

(8,763)

(442)

(9,205)

(4,029)

535

(3,494)

 

 Andes

 Interoil

 Group

 Andes

 Interoil

 Group


30-Jun-16

30-Jun-16

30-Jun-16

30-Jun-15

30-Jun-15

30-Jun-15


US$'000

US$'000

US$'000

US$'000

US$'000

US$'000

Loss for the period from continuing operations

(8,763)

(442)

(9,205)

(4,029)

535

(3,494)

Add: Depreciation and amortisation

3,655

2,611

6,266

4,408

1,920

6,328

Less: Exceptional gain

-

-

-

(1,309)

-

(1,309)

Less: Settlement fee

-

-

-

-

(4,000)

(4,000)

Less: Finance income

(1,737)

-

(1,737)

(1,451)

(2,494)

(3,945)

Add: Finance costs

7,814

1,709

9,523

5,039

3,586

8,625

Add: Exchange gains and losses

3,071

133

3,204

(682)

-

(682)

Add: Tax

1,339

(1,670)

(331)

516

3,463

3,979

EBITDA

5,379

2,341

7,720

2,492

3,010

5,502

 

 

 

4.         Finance costs

 

Only US$0.3 million of the finance costs were paid in cash during the period (2015: US$ 1.9 million). The other finance costs were not due to be paid and relate primarily to convertible loans.

 

5.         Loss per share

 

Basic loss per share is calculated by dividing the net loss for the period attributable to ordinary shareholders of the Group by the weighted average number of ordinary shares outstanding during the period. The basic and diluted loss per share are the same as there are no instruments that have a dilutive effect on earnings. Adjusted basic and diluted loss per share are presented after adjustment of exceptional items.

 

30-Jun-16

30-Jun-15

31-Dec-15

Cents

Cents

Cents

Basic and diluted loss per share

(1.47)

(0.68)

(2.68)

Adjusted basic and diluted loss per share

(1.47)

(0.92)

(2.68)

US$'000

US$'000

US$'000

Loss for the period attributable to equity holders

(8,878)

(3,756)

(15,226)

Exceptional items

-

(1,309)

-

Adjusted loss for the period attributable to equity holders

(8,878)

(5,065)

(15,226)

No.'000

No.'000

No.'000

Weighted average number of shares

605,505

551,975

569,064

Effect of dilutive warrants

 -  

 -  

 -  

Diluted weighted average number of shares

605,505

551,975

569,064

No.'000

No.'000

No.'000

Potential number of dilutive warrants

59,240

45,656

59,240

 

6.         EBITDA

 

30-Jun-16

30-Jun-15

31-Dec-15


US$'000

US$'000

US$'000

Loss for the period from continuing operations

(9,205)

(3,494)

(18,385)

Less: Exceptional gain on acquisition

-

(1,309)

-

Less: Settlement fee

-

(4,000)

-

Add: Depreciation and amortisation

6,266

6,328

13,909

Less: Finance income

(1,737)

(3,945)

(1,109)

Add: Finance costs

9,523

8,625

18,272

Add: Exchange gains and losses

3,204

(682)

(1,879)

Add: Tax

(331)

3,979

5,938

EBITDA

7,720

5,502

16,746

 

7.         Comprehensive income

 

The translation loss primarily arises as a result of the devaluation of the AR$ against the US$ during the period. The carrying value of intangibles assets, other assets and liabilities in Argentina are held in AR$ and on consolidation translated to US$, the presentation currency. The resulting exchange gains and losses are classified as equity and transferred to the Group's translation reserve. This is not indicative of an impairment in the carrying value of these assets.



 

8.         Cash generated from operations

 


Group


30-Jun-16

30-Jun-15

31-Dec-15


US$'000

US$'000

US$'000

(Loss)/profit for the period before taxation

(9,536)

485

(12,447)

Exceptional items

-

(1,309)

-

Loss for the period before taxation and exceptional items

(9,536)

(824)

(12,447)

Adjustments from operating activities

Depreciation and amortization

6,266

6,328

13,909

Exchange movements and gains and losses

3,320

(672)

(5,434)

Revaluation of investments

-

450

56

Decrease/(increase) in inventories

773

(663)

(1,032)

Increase in trade and other receivables

(4,718)

(3,447)

(6,196)

Increase/(decrease) in creditors and other payables

10,748

(172)

15,513

Finance costs

9,523

8,625

18,272

Finance income

(1,737)

(3,945)

(1,109)

Movement in provisions

(853)

(64)

(2,735)

Profit on sale of investments

-

-

(378)

Share based payments

155

165

332

Net cash generated from operating activities

13,941

5,781

18,751

 

9.         Other

 

A copy of the interim report will be made available on Andes's website at www.andesenergiaplc.com.ar

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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