TIDMTHAL
RNS Number : 2577N
Thalassa Holdings Limited
27 September 2012
Thalassa Holdings Ltd
(Reuters: THAL.L, Bloomberg: THAL:LN)
("Thalassa" or the "Company")
Results for the 6 months to 30 June 2012
The Company is pleased to announce its financial results for the
6 months ended 30 June 2012. A summary of the results is set out
below.
Chairman's Statement
Highlights
Financials - 1st Half 2012
-- WGP Exploration Ltd ("WGPE") fully integrated within the Company for the period.
-- Revenues for the 6 months to 30 June 2012 increased by 756%
to US$3,978,560 (H1 2011 US$464,777).
-- Operating Profit before depreciation increased by 752% to US$501,884 (H1 2011 US$58,885).
-- Net Profit for the period increased by US$391,415 to US$335,991 (H1 2011 loss of US$55,424).
-- Earnings per share for the period of US$0.04 / GBP0.03 versus
a loss of US$(0.01) / GBP(0.01) per share for the same period in
2011.
Operations
-- Successful completion of the fifteenth Life of Field Seismic
("LoFS") survey over the Valhall field in the North Sea for BP, the
Group's fourth survey since the award of the contract in 2010.
-- Joint venture arrangement with P-Cable 3D Seismic AS
("P-Cable") to commercialise P-Cable's patented 3D seismic
technology.
-- Award of new contract to provide seismic data acquisition
surveys using the P-Cable 3D seismic technology for Spring Energy
Norway AS ("Spring Energy").
-- Award of turnkey contract to provide seismic data acquisition
surveys in the Arctic to Russian State Sevmorgeo Company
("SMG").
-- Completion of permanent reservoir monitoring ("PRM")
feasibility studies for two major energy companies with the hope of
securing more contracts in 2013.
-- Enhancement of operational capability through the acquisition
of two compressor units and planned further CAPEX of $1.3m before
the year end.
First Half Review
The Company has delivered strong revenue and earnings growth in
the period under review with the 15th LoFS survey over the Valhall
field in the North Sea successfully completed and the commencement
of the contracts with SMG and Spring Energy.
Outlook - 2nd Half and Full Year 2012
Operations
The second half's focus has turned from the completion of the BP
Valhall shoot and the mobilisation phase of the SMG and Spring
Energy projects, to completion of the operational and subsequent
de-mobilisation phases, expected to complete in October.
The Company's performance to date in the second half has been
severely affected by very poor weather in the North Atlantic which
has been some of the worst since records began. As a result the
Company has operated below targeted production rates. Despite this,
the data acquired has far exceeded the clients expectations and I
am happy to report that we are in discussions with both major
contractors regarding possible repeat business and expanded
operating opportunities.
Financials
The operational and demobilisation phases of both the SMG and
the Spring Energy projects largely fall into the second half of the
year. As a result the contribution to revenue and profit of these
projects will be significantly higher in the second half than in
the first half of the year.
Due to the severe weather in the North Atlantic and an increase
in operational standby (when the vessel is either at standby at sea
or in port due to adverse weather conditions), we anticipate
revenues will be around US$14m for the year as compared to US$15m
previously estimated. Despite this, due to early response to
diminished revenue and strict cost control, profit after tax
attributable to shareholders of the company is expected to exceed
current estimates of around US$1.2m.
Outlook for 2013
I am happy to report that due to the success of our work in
LoFS, that a number of significant opportunities in Europe and
Latin America have presented themselves. These contracts are
potentially very significant and present a great opportunity along
with the associated challenges which projects of such size
present.
Along with the ongoing BP contract, with a further three surveys
to complete in 2013/14, and potential follow on work from the
projects due to complete in 2012, business enquiries are at an all
time high.
As a final note, I would like to express my gratitude to the
Company's shareholders for their patience as we have built the
Company to the point we are at now and to our employees for their
continued commitment and outstanding performance in what has been
some extremely challenging conditions.
C. Duncan Soukup
Chairman
Operational Review - Mark Burnett (CEO WGP Exploration Ltd)
Exploration and Beyond...
2012 has thus far clearly demonstrated the strategic aim to
undertake and seek opportunities aimed at providing seismic
solutions for both the Exploration and Production sectors with
exploration projects in frontier and challenging locations coupled
with the continuation of LoFS projects in maturing basins.
Valhall LoFS
Under the existing four year contract with BP (which commenced
on the 10th May 2010), WGP acquired LoFS 15 survey during the
summer. Mobilisation commenced in Stavanger on the 9th May with
installation and testing of the PMSS(TM) on the PSV "Stril Myster",
being deemed complete on the 12th May.
The survey was completed on the 18th June, having acquired the
full data set, whereupon demobilisation was effected in Stavanger,
which involved removing the equipment from the vessel followed by a
period of maintenance and preservation works.
Only a single LoFS survey is to be completed during 2012 as
opposed to the usual two, due to SIMOPS (Simultaneous Operations),
which prevented a second survey being acquired later in the year.
LoFS 16 is planned for Q2 2013, date to be confirmed.
SMG - Arctic Operations
As a follow-on to the work performed in 2011 in conjunction with
Ion Geoventures, the Group was contracted by SMG directly to
provide a solution to acquire seismic data in the Russian sector of
the Arctic Ocean.
To perform the project, a PMSS(TM) coupled with a towed streamer
system (cable / recording system / handling system) was installed
on the back deck of the Russian Ice Breaker "Dikson".
Mobilisation was undertaken in Kirkenes, northern Norway and
took 30 days to complete, including sea trials and shake down.
The project will focus on the East Siberian and Laptev seas,
acquiring data to assist the delineation of the Russian continental
shelf. Acquisition will continue until the end of September,
whereupon the vessel will return to Kirkenes to remove the
equipment and reinstate the vessel.
Whilst the summer melt of the sea ice in the Arctic has been
quite astonishing, the operations have still been undertaken in an
extreme environment of both treacherous conditions on deck and
hazards to the in-sea equipment from the pack ice through which the
vessels have sailed.
Spring Energy - P-Cable High Resolution 3D
In June 2012, as previously announced, a new joint venture was
formed between WGP Group Ltd (a wholly owned subsidiary of the
Company) and Fjorgyn AS (a wholly owned subsidiary of P-Cable).
The purpose of the vehicle was to marry the technology developed
and patented by P-Cable, with WGP's operational and engineering
expertise and experience to offer a 3D High Resolution data
acquisition service to clients.
The Joint Venture's initial marketing efforts were rewarded with
a contract from Spring Energy, a Norwegian private energy company
with interests in the Norwegian Sector of the Barents Sea.
In order to fulfil the contract, a suitable vessel was
identified ("Atlantic Wind"), in a very condensed time frame, and
the equipment installed. Mobilisation was completed in Stavanger
commencing in May, with sea trials conducted during the transit
north and further remedial works undertaken in Tromsø.
The vessel was severely hampered by the unseasonably poor
weather in the North Atlantic and the number of shooting days were
less than expected however, the P-Cable equipment is acquiring a
quality and resolution of data that far exceeds the Client's
expectations.
Outlook for H2 2012
Q4 will see the demobilisation of the two major projects that
have been running during Q2/3. This will absorb all operational
resources during that time. Also planned for Q4 is a discrete
project in the UK for an Oil Major to test a novel and innovative
method in the operation of seismic airguns, which will potentially
be tested in field conditions in the North Sea in Q2 2013.
The pipeline remains healthy, with enquiries (RFI's / RFP's) for
both PRM activity (predominantly South America and the North Sea)
and niche projects requiring bespoke solutions.
During 2012, WGP had a QHSSE Verification Audit completed by
Shell, the positive outcome of which ensures pre-qualification to
participate in future tenders.
Whilst the quantum of secured backlog of work into 2013 remains
at a nominal level, it is a repeat of a pattern seen over the past
few years, where projects for Q2/3 2013 will not be awarded, and
may not appear on the radar until Q1 2013.
Offshore seismic operations are heavily weather dependent, with
operating capabilities usually restricted to the summer months for
the region of activity. Currently, the Group's operations are
focused in the North Atlantic and Arctic with the result that we
experience peaks and troughs in the demand for our services. One of
the Group's strategic aims is to increase activities in the
Southern hemisphere, being counter cyclical to the Northern
hemisphere seasons, or in equatorial regions where there is less
seasonal variance.
Mark Burnett
CEO - WGP Exploration Ltd
Financial Review
Group results for the 6 months to 30 June 2012 show an increase
in revenue to US$3,978,560 as compared to the first half of 2011 of
US$464,777, an increase of 756% due in part to the incorporation of
WGPE for the period following its acquisition in November 2011.
Revenue in the first half was generated from the seismic shoot
on the Valhall field that completed in June 2012, the new turnkey
contract with SMG to provide seismic data acquisition surveys in
the Arctic and with Spring Energy as part of the new joint venture
with P-Cable. Due to the operational phase of both these contracts
falling into the second half of the year, the contribution to
revenue and profit of these projects will be significantly higher
in the second half.
Cost of sales of US$2,113,888 (H1 2011: US$ 19,484) and
Administrative Expenses of US$1,362,788 (H1 2011: US$386,408) have
resulted in Operating Profit before depreciation of US$501,884
compared to a profit of US$58,885 for the comparative period.
Operating profit, stated after Depreciation of US$149,187 (H1
2011: US$110,937), was US$352,687 (H1 2011: loss US$52,052).
Net interest expense of US$(8,623), foreign currency gains of
US$7,583 and a tax charge of US$(15,666) have resulted in a net
profit for the period of US$335,991 as compared to a net loss of
US$(55,424) in H1 2011.
Basic profit per share was US$0.04/GBP0.03 and diluted loss per
share was US$0.03/GBP0.02 compared to basic and diluted loss per
share of US$(0.01)/GBP(0.01) in the prior period.
Net assets at 30 June 2012 amounted to US$9,335,273 resulting in
a net asset value per share of US$0.96 (GBP0.61) in comparison to
US$1.03 (GBP0.64) for the prior period.
Cash outflow for the period amounted to US$(27,599) relating
largely to cash inflow from operating activities offset by
equipment purchases.
Consolidated Income Statement
Six months ended 30 June 2012
Six months Six months
ended ended
30 June 30 June
2012 2011
Unaudited Unaudited
Note US$ US$
Continuing operations
Revenue 3,978,560 464,777
Cost of sales (2,113,888) (19,484)
--------------- ----------
Gross profit 1,864,672 445,293
--------------- ----------
Administrative expenses (1,362,788) (386,408)
Operating profit before depreciation 501,884 58,885
Depreciation (149,187) (110,937)
--------------- ----------
Operating profit/(loss) 352,697 (52,052)
--------------- ----------
Interest income 621 1,610
Interest expense (9,244) (25,009)
Other gains and losses - foreign
currency gains 7,583 20,027
--------------- ----------
Profit/(loss) before taxation 351,657 (55,424)
--------------- ----------
Tax (15,666) -
--------------- ----------
Profit/(loss) for the financial
period 335,991 (55,424)
=============== ==========
Earnings per share
Basic (US$) 3 0.04 (0.01)
=============== ==========
Diluted (US$) 3 0.03 (0.01)
=============== ==========
Basic (GBP) 0.03 (0.01)
=============== ==========
Diluted (GBP) 0.02 (0.01)
=============== ==========
Consolidated Statement of Comprehensive Income
Six months ended 30 June 2012
Six months Six months
ended ended
30 June 30 June
2012 2011
Unaudited Unaudited
US$ US$
Profit for the financial period 335,991 (55,424)
Other comprehensive income:
Exchange differences on re-translating
foreign operations (10,427) -
--------------- ----------
Total comprehensive income 325,564 (55,424)
=============== ==========
Consolidated Statement of Financial Position
At 30 June 2012
At At
30 June 31 December
2012 2011
Unaudited Audited
US$ US$
ASSETS
Non-current assets
Goodwill 368,525 368,525
Tangible fixed assets 7,913,479 7,018,787
Available for sale investments 35,888 -
------------- -----------
Total non-current assets 8,317,892 7,387,312
------------- -----------
Current assets
Trade and other receivables 2,448,537 558,381
Cash and cash equivalents 1,943,226 1,970,825
------------- -----------
Total current assets 4,391,763 2,529,206
------------- -----------
LIABILITIES
Current liabilities
Trade and other payables 3,374,382 906,809
------------- -----------
Total current liabilities 3,374,382 906,809
------------- -----------
Net current assets 1,017,381 1,622,397
------------- -----------
Net assets 9,335,273 9,009,709
============= ===========
EQUITY
Shareholders' equity
Share capital 111,887 111,887
Share premium 8,517,782 8,517,782
Treasury shares (384,226) (384,226)
Other reserves (29,231) (18,804)
Retained earnings 1,119,061 783,070
------------- -----------
Total Shareholders' equity 9,335,273 9,009,709
============= ===========
Consolidated Cash Flow Statement
Six months ended 30 June 2012
Six months Six months
ended ended
30 June 30 June
2012 2011
Unaudited Unaudited
US$ US$
Cash flows from operating activities
Operating Profit before depreciation 501,884 58,885
Increase in inventory - (81,109)
Decrease in loans and receivables - 21,268
Increase in trade and other receivables (1,890,156) (23,726)
Increase/(Decrease) in trade and
other payables 2,451,907 (126,888)
Acquisition of investments (35,888) -
Net Foreign Exchange gain/(loss) (2,845) 20,027
--------------- ----------
Cash used by operations 1,024,902 (131,543)
Interest paid (9,244) (25,009)
--------------- ----------
Net cash flow from operating activities 1,015,658 (156,552)
--------------- ----------
Cash flows from investing activities
Interest received 621 1,610
Purchase of equipment (1,043,878) (46,669)
--------------- ----------
Net cash flow from investing activities (1,043,257) (45,059)
--------------- ----------
Cash flows from financing activities
Increase in shareholder loan - 12,373
--------------- ----------
Net cash flow from financing activities - 12,373
--------------- ----------
Net decrease in cash and cash equivalents (27,599) (189,238)
Cash and cash equivalents at the
start of the period 1,970,825 504,989
--------------- ----------
Cash and cash equivalents at the
end of the period 1,943,226 315,751
=============== ==========
Consolidated Statement of Changes in Equity
Six months ended 30 June 2012 (unaudited)
Retained
earning
Share Share Treasury Other / Total
Note Capital Premium shares reserves (losses) Equity
US$ US$ US$ US$ US$ US$
Balance as at
1 January 2011 85,000 7,264,414 (313,725) - 427,395 7,463,084
Total comprehensive
income for the
period - - - - (55,424) (55,424)
------- --------- --------- -------- --------- ---------
Balance as at
30 June 2011 85,000 7,264,414 (313,725) - 371,971 7,407,660
------- --------- --------- -------- --------- ---------
Balance as at
1 January 2012 111,887 8,517,782 (384,226) (18,804) 783,070 9,009,709
Total comprehensive
income for the
period - - - (10,427) 335,991 325,564
------- --------- --------- -------- --------- ---------
Balance as at
30 June 2012 111,887 8,517,782 (384,226) (29,231) 1,119,061 9,335,273
------- --------- --------- -------- --------- ---------
Notes to the Consolidated Interim Financial Information
1. General information
Thalassa Holdings Ltd (the "Company") is a British Virgin Island
("BVI") International business company ("IBC"), incorporated and
registered in the BVI on 26 September 2007. The Company was
established as a holding company, and has one operating subsidiary,
WGP Group Ltd ("WGP"), in the Energy Services Industry currently
focused on marine geophysical services in the following areas of
activity:
-- Production Enhancement
-- Exploration
-- Surveying
WGP Group Ltd is a wholly owned subsidiary of Thalassa which
owns the seismic operating assets of the Thalassa Group and whose
subsidiaries are:
-- WGP Energy Services Ltd ("WESL")
-- WGP Exploration Ltd ("WGPE")
-- WGP Technical Services Ltd ("WGPT")
-- WGP Survey Ltd ("WGPS")
The condensed consolidated interim financial information was
approved for issue by the Company's Board of Directors on 26th
September 2012. This financial information is unaudited but has
been reviewed by the Company's auditors.
2. Significant Accounting policies
The Group prepares its accounts in accordance with applicable
International Financial Reporting Standards ("IFRS") as adopted by
the EU.
The accounting policies applied by the Company in this unaudited
consolidated interim financial information are the same to those
applied by the Company in its consolidated financial statements as
at and for the period ended 31 December 2011.
2.1. Basis of preparation
The consolidated interim financial information for the six
months ended 30 June 2012 has been prepared in accordance with
International Accounting Standard No. 34, 'Interim financial
reporting'. They do not include all of the information required for
full annual financial statements and should be read in conjunction
with the consolidated financial statements of the Company as at and
for the period ended 31 December 2011.
2.2. Going concern
The financial information has been prepared on the going concern
basis as management consider that the Group has sufficient cash to
fund its current commitments for the foreseeable future.
3. Earnings per share
Six months Six months
ended ended
30 June 30 June
2012 2011
Unaudited Unaudited
The calculation of earnings per
share is based on the following
profit / (loss) and number of shares:
Profit / (loss) for the period (US$) 335,991 (55,424)
=============== ==========
Weighted average number of shares
of the Company:
Basic 7,526,823 7,200,000
Diluted 9,794,344 9,580,000
=============== ==========
Earnings / (loss) per share:
Basic (US$) 0.04 (0.01)
Diluted (US$) 0.03 (0.01)
=============== ==========
4. Related party balances and transactions
During the period, the Company was invoiced US$222,000 of fees
(H1 2011: US$222,000) and US$7,689 of interest (H1 2011: US$12,085)
from a company in which the Chairman has a beneficial interest.
Such fees include legal, financial and administrative services
provided to the Company. At 30 June 2012, the amount owed to this
company was US$235,932.
5. Share options
During the period none of the share options were exercised,
lapsed or issued.
6. Post balance sheet events
No material events to report.
7. Copies of the Interim Report
The interim report is available on the Company's website:
www.thalassaholdingsltd.com.
Contact:
Duncan Soukup, Executive Tel: + 33 (0)6 78 63
Chairman 26 89
------------------------- --------------------------------------
Thalassa Holdings Ltd
------------------------- --------------------------------------
Antony Legge/James Felix Tel: + 44 (0)20 7776
6550
------------------------- --------------------------------------
Daniel Stewart & Company
plc
------------------------- --------------------------------------
www.thalassaholdingsltd.com
Notes to Editor:
Thalassa Holdings Ltd, incorporated and registered in the BVI
and quoted on AIM, is a holding company with a focus on marine
seismic operations. The corporate strategy for the Group is
"Exploration and Beyond". "Exploration" is focused on activity in
frontier and challenging locations, whilst "Beyond" focuses on
production activity by looking to secure opportunities in the
permanent reservoir monitoring market. Thus activity and focus will
be dominated by projects in remote and challenging frontier
locations, coupled with lower risk projects in mature producing
regions.
Alongside the technical expertise and consultancy in marine
seismic operations provided through its subsidiary, WGP, the Group
owns and operates two portable modular source systems (PMSS(TM)).
The PMSS(TM) generates a seismic source for use in seismic
acquisition for use in petroleum exploration and production. The
equipment is temporarily installed on the back of a platform supply
vessel for the purposes of acquiring data.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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