TIDMTHAL
RNS Number : 8362A
Thalassa Holdings Limited
26 March 2013
26 March 2013
Thalassa Holdings Ltd
(Reuters: THAL.L, Bloomberg: THAL:LN)
("Thalassa" or the "Company")
Final results for the year ended 31 December 2012 and notice of
AGM
Financial Highlights
-- Revenue up 477% to US$ 14.0m (2011: US$ 2.4m).
-- Operating Profit up 330% to US$ 1.5m (2011: US$ 0.3m).
-- Net Profit up 238% to US$ 1.2m (2011: US$ 0.4m).
-- Earnings Per Share (diluted) up 150% to US$ 0.10 (GBP0.06) (2011: US$ 0.04 (GBP0.03)).
-- Book value per share (diluted) up 11.8% to US$ 0.85 (GBP0.53) (2011: US$ 0.76 (GBP0.47)).
-- Cash as at 31 December 2012 up 25.9% to US$ 2.5m (2011: US$ 2.0m).
-- No borrowings as at 31 December 2012 (2011:US$ nil).
Operational Highlights
-- Successful completion of the 15th Life of Field Seismic
("LoFS") survey for BP over the Valhall Field in the North Sea, the
fourth LoFS survey at Valhall to be carried out using the Group's
Portable Modular Source System ("PMSS(TM) ").
-- Successful completion of turnkey contract with Joint Stock
Company Sevmorgeo ("SMG") to provide seismic acquisition services
in the Arctic.
-- Successful completion of seismic acquisition services using
P-Cable 3D seismic technology for Spring Energy in the North
Sea.
Contacts:
Thalassa Holdings Ltd:
Duncan Soukup, Executive Chairman +33 (0) 6 78 63 26 89
WH Ireland Limited (Nominated adviser):
Chris Fielding, Head of Corporate Finance 020 7220 1650
Chairman's Statement
I am happy to report record financial performance at every level
in 2012. The 15th LoFS survey over the Valhall Field in the North
Sea in the first half and the SMG Arctic and Spring Energy projects
in the second half were all completed successfully and, had it not
been for appalling weather in the North Atlantic during Q3 2012,
results would have been even better.
Outlook for 2013
-- New contract and supplemental agreements announced with SMG,
the Russian geological sea survey company in Ecuador, with an
estimated aggregate value of approximately US$ 6.7m.
-- Letter of Intent relating to 2 proposed contracts with
Statoil, the Norwegian oil major, with a potential aggregate value
of approximately US$ 85m over 9 years.
The award of the recently announced Statoil Letter of Intent (27
February 2013) is a significant milestone in the Group's history,
both in terms of long term revenue visibility and also as an
endorsement of our PMSS(TM) solution for use in LoFS projects.
In addition to the Statoil Letter of Intent, the Company has
also announced (18 January 2013) a contract with SMG Ecuador, a
subsidiary of SMG, providing marine seismic acquisition services in
Ecuador.
As a result, the Company has made significant headway in
extending the Group's shooting season through expansion into the
southern hemisphere.
In light of the Statoil Letter of Intent, the recent contract
win for SMG in Ecuador and a significant increase in potential
customer enquiries, the long term growth prospects are
excellent.
I would like to thank the staff for their continued commitment,
dedication and performance in what have been some extremely
challenging conditions.
C. Duncan Soukup, Chairman, 25 March 2013
Operational Review
Valhall LoFS
The Group successfully completed the fifteenth LoFS survey over
the Valhall field in the North Sea for BP, being the fourth LoFS
survey at Valhall to be carried out using the Group's PMSS(TM) . As
per previous surveys, the PMSS(TM) was mobilised on the M/V Stril
Myster, a field platform vessel that is converted into a seismic
source vessel for the duration of each project lasting
approximately 6 weeks, including time for mobilisation and
de-mobilisation.
Only one survey was completed during 2012 due to increased 3D
seismic activity in the region.
SMG - Arctic Operations
In 2012 the Group was contracted by SMG to provide a solution to
acquire seismic data in the Russian sector of the Arctic Ocean
focusing on the East Siberian and Laptev seas.
To perform the project, a PMSS(TM) coupled with a towed streamer
system (cable / recording / handling system) was installed on the
back deck of the Russian Ice Breaker "Dikson" in Kirkenes, northern
Norway. During the survey, the "Dikson" was also escorted by the
icebreaker "Kapitan Dranitsyn", to act as a lead vessel through
pack ice. Our PMSS(TM) was able to operate in the Arctic waters
during a 45 days period between mid-August and the end of
September, during which some 5,300 line km's of 2-D towed streamer
data and Ocean Bottom Seismometers (OBS node) data was
acquired.
To achieve over 5,000 survey km's without incident or damage to
in-water equipment when working in such challenging conditions,
with sea water temperatures down to -2degC, demonstrates not only
the flexibility and ability of the PMSS(TM) to operate in different
environments, but also the Group's expertise in providing bespoke
marine geophysical services and solutions.
Spring Energy - P-Cable High Resolution 3D
During 2012 the Group also successfully completed a seismic data
acquisition survey on the Norwegian Continental Shelf for Spring
Energy.
The contract, using our joint venture partner P-Cable's high
resolution 3D system, included the acquisition of six valuable
high-resolution 3D data sets over 134km(2) of shallow target
anomalies in the Barents Sea, which was carried out despite being
affected by very poor weather in the North Atlantic.
Notwithstanding this, the quality of the data sets acquired
endorsed the Group's belief in the concept of the P-Cable system
and its potential for new opportunities in the future.
Outlook for 2013
On 27 February 2013, the Company announced that its WGP
subsidiary had received and executed a letter of intent with
Statoil AS, the Norwegian oil major, to provide long-term seismic
acquisition services for the permanent reservoir monitoring of the
Snorre and Grane oil fields in the Norwegian sector of the North
Sea. The seismic acquisition contract, excluding any extensions,
has a value of approximately US$ 32m and up to approximately US$
65m if Statoil exercises the options to extend the contract by a
further four years.
The letter of intent also covers Statoil's purchase of a bespoke
dual portable modular system (D-PMSS(TM) ), which WGP shall
maintain and operate throughout the duration of the acquisition
contract. The value of this contract is US$ 19.8m. The Company has
received a purchase order for the D-PMSS(TM) from Statoil and the
procurement process has commenced. Statoil has agreed to meet all
costs incurred by WGP in the event that the final contracts are not
executed.
On 18 January 2013, the Group announced a contract with SMG
Ecuador, the Ecuador business of SMG, involving the provision and
operation of the PMSS(TM) as part of seismic data acquisition
surveys being conducted in Ecuador. A number of supplemental
agreements have also been announced including:
-- the supply of 11 containers containing ocean bottom nodes and instrument rooms;
-- the sourcing of a vessel and supply of additional services; and
-- the supply of node handling equipment and associated services.
The expected aggregate value of the contract and supplemental
agreements is approximately US$ 6.7m, an increase of 60% from the
initial contract.
The Group has made a great start to 2013 with both the SMG
Ecuador project and the recently announced Statoil Letter of
Intent. The pipeline of enquiry remains strong for both permanent
reservoir monitoring activity and niche projects requiring bespoke
solutions.
Mark Burnett, CEO WGP Exploration Ltd
Financial Review
Group results for the year to 31 December 2012 show revenue of
US$ 14.0m, an increase of 477% compared to 2011 (2011: US$ 2.4m).
Gross Profit in the year was US$ 4.9m, a 101% increase compared to
2011 (US$ 2.5m). Operating profit (EBIT) was US$ 1.5m, an increase
of 330% from 2011 (US$ 0.3m). Profit for the financial period
attributable to shareholders of the parent was US$ 1.2m, an
increase of 238% over the prior period (US$ 0.4m).
Basic earnings per share was US$ 0.12 (GBP0.08) and diluted
earnings per share was US$ 0.10 (GBP0.06) as compared to basic
earnings per share of US$ 0.05 (GBP0.03) and diluted earnings per
share of US$ 0.04 (GBP0.03) in the prior period.
Revenue of US$ 14.0m generated from operations includes the
completion of the 15th LoFS survey at BP's Valhall field in the
North Sea, the survey completed for SMG as part of their Arctic
exploration programme and the completion of the survey for Spring
Energy using the P-Cable 3D seismic technology.
Cost of sales of US$ 9.1m includes direct operational costs
largely relating to the provision and fabrication of equipment,
charter fees, personnel and project management costs on marine
seismic acquisition services.
Administrative expenses of US$ 2.9m (US$ 1.2m), increased by
138% largely due to inclusion of a full year of WGP Exploration
Ltd's costs (US$ 2.0m) following its acquisition in November 2011,
relating predominantly to personnel costs. The year ended 31
December 2011 only included 2 months of costs from the date of
acquisition, a total of US$ 0.3m.
Operating profit before depreciation was US$ 2.0m compared to
US$ 1.2m for the comparative period. The depreciation charge of US$
0.6m (US$ 0.4m) in the period relates to the two owned PMSS(TM)
units and capital additions including the two compressors purchased
during the period. An assessment of the equipment was undertaken in
the period as part of the annual impairment review and concluded
that no impairment charge was required in the period (2011: US$
0.5m).
Net financial income/(expense) includes foreign exchange losses
in the period of US$0.2m. Most of the Group's revenues are US$
denominated with foreign exchange exposure for expenditure in
various currencies including GBP, Euro and Norwegian Krone. Where
costs are known, measures will be put in place to mitigate the
Group's exposure to foreign exchange movements. However, in 2012,
the Group incurred an increase in expenditure in certain
currencies, predominantly NOK, resulting in a currency loss in the
period. The majority of the foreign exchange losses incurred in
2012 have since been reversed in 2013.
Net assets at 31 December 2012 amounted to US$ 10.3m (2011: US$
9.0m). Net asset value per share (diluted) was US$ 0.85 (GBP0.53)
in comparison to US$ 0.76 (GBP0.47) for the prior period.
The Company had no borrowings during the period.
Net cash flow from operating activities amounted to US$ 1.9m,
with net cash outflow from investing activities amounting to
US$1.4m largely due to the purchase of capital equipment.
Cash at the period end was US$ 2.5m.
Consolidated Statement of Income
for the year ended 31 December 2012
2012 2011
Note US$ US$
Continuing operations
Revenue 2.9 14,007,070 2,427,985
Cost of sales (9,067,000) 31,275
----------- -----------
Gross profit 4,940,070 2,459,260
----------- -----------
Administrative expenses (2,896,329) (1,216,877)
----------- -----------
Operating profit before depreciation 3 2,043,741 1,242,383
----------- -----------
Depreciation 8 (562,695) (398,611)
Impairment of fixed assets 8 - (499,060)
----------- -----------
Operating profit 1,481,046 344,712
----------- -----------
Net financial income/(expense) 4 (228,154) 10,963
----------- -----------
Profit before taxation 1,252,892 355,675
----------- -----------
Taxation (3,503) -
----------- -----------
Profit for the year 1,249,389 355,675
----------- -----------
Non-controlling interest (46,205) -
----------- -----------
Profit attributable to shareholders of the parent 1,203,184 355,675
----------- -----------
Earnings per share
Basic 5 US$ 0.12 US$ 0.05
Diluted 5 US$ 0.10 US$ 0.04
Consolidated Statement of Comprehensive Income
for the year ended 31 December 2012
2012 2011
US$ US$
Profit for the financial period 1,203,184 355,675
Other comprehensive income:
Exchange differences on re-translation of foreign operations (845) (18,804)
--------- --------
Total comprehensive income 1,202,339 336,871
--------- --------
Consolidated Statement of Financial Position
as at 31 December 2012
2012 2011
Note US$ US$
Assets
Non-current assets
Goodwill 368,525 368,525
Tangible fixed assets 8 7,853,856 7,018,787
Available for sale investments 9 38,675 -
---------- ---------
Total non-current assets 8,261,056 7,387,312
---------- ---------
Current assets
Inventory 10 81,777 -
Trade and other receivables 11 628,078 558,381
Cash and cash equivalents 2,482,469 1,970,825
---------- ---------
Total current assets 3,192,324 2,529,206
---------- ---------
Liabilities
Current liabilities
Trade and other payables 12 1,173,839 906,809
---------- ---------
Total current liabilities 1,173,839 906,809
---------- ---------
Net current assets / (liabilities) 2,018,485 1,622,397
---------- ---------
Net assets 10,279,541 9,009,709
---------- ---------
Shareholders Equity
Share capital 13 133,175 111,887
Share premium 13 8,517,782 8,517,782
Treasury shares 13 (384,226) (384,226)
Other reserves (19,649) (18,804)
Retained earnings 1,986,254 783,070
---------- ---------
Total Shareholders Equity 10,233,336 9,009,709
Non-controlling Interest 46,205 -
---------- ---------
Total Equity 10,279,541 9,009,709
---------- ---------
These financial statements were approved and authorised by the
board on 25 March 2013.
C. Duncan Soukup, Chairman
Consolidated Statement of Cash Flows
for the year ended 31 December 2012
2012 2011
US$ US$
Cash flows from operating activities
Operating profit for the period before depreciation 2,043,741 1,242,383
(Increase) / decrease in inventory (81,777) -
(Increase) / decrease in loans and receivables - 21,268
(Increase) / decrease in trade and other receivables (69,697) 535,433
Increase / (decrease) in trade and other payables 267,030 (1,605,796)
Net foreign exchange gain/(loss) (193,870) 12,639
Taxation (3,503) -
----------- -----------
Cash used by operations 1,961,924 205,927
Interest paid (37,762) (23,396)
----------- -----------
Net cash flow from operating activities 1,924,162 182,531
----------- -----------
Cash flows from investing activities
Acquisition of investments (38,675) -
Investment income 1,397 1,379
Interest received 1,236 1,688
Purchase of equipment (1,397,764) (180,008)
Acquisition of WGP - 1,778,182
----------- -----------
Net cash flow from investing activities (1,433,806) 1,601,241
----------- -----------
Cash flows from financing activities
Increase / (decrease) in Shareholder loans - (247,435)
Issue of Ordinary Share Capital 21,288 -
Treasury shares - (70,501)
----------- -----------
Net cash flow from financing activities 21,288 (317,936)
----------- -----------
Net increase in cash and cash equivalents 511,644 1,465,836
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 2,482,469 1,970,825
----------- -----------
Consolidated Statement of Changes in Equity
for the year ended 31 December 2012
Share Share Treasury Other Retained Total Non- Total
Capital Premium shares Reserves earnings / Shareholders controlling Equity
(losses) Equity interest
US$ US$ US$ US$ US$ US$ US$ US$
Balance as at
31 December
2010 85,000 7,264,414 (313,725) - 427,395 7,463,084 - 7,463,084
Shares issued on
acquisition of
WGP 26,887 1,253,368 - - - 1,280,255 - 1,280,255
Purchase of
treasury shares - - (70,501) - - (70,501) - (70,501)
Total
comprehensive
income for the
period - - - (18,804) 355,675 336,871 - 336,871
Balance as at
31 December
2011 111,887 8,517,782 (384,226) (18,804) 783,070 9,009,709 - 9,009,709
Issue of
Ordinary
Share Capital 21,288 - - - - 21,288 - 21,288
Movement in
Non-controlling
Interest - - - - - - 46,205 46,205
Total
comprehensive
income for the
period - - - (845) 1,203,184 1,202,339 - 1,202,339
-------- ------------ ----------- ----------- ----------- ------------ ----------- ----------
Balance as at
31 December
2012 133,175 8,517,782 (384,226) (19,649) 1,986,254 10,233,336 46,205 10,279,541
-------- ------------ ----------- ----------- ----------- ------------ ----------- ----------
Notes to the Consolidated Financial Statements
for the year ended 31 December 2012
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 currently has one operating
subsidiary, WGP Group Ltd ("WGP") (together with Thalassa Holdings
Ltd, the "Group").
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")
2. Accounting policies
The Group prepares its accounts in accordance with applicable
International Financial Reporting Standards ("IFRS") as adopted by
the European Union. The consolidated financial statements have been
prepared on the historical cost basis except for available for sale
investments that have been measured at fair value.
The financial statements are expressed in US dollars, being the
functional currency of the company and its subsidiaries other than
WGP Exploration Ltd which has a functional currency of pound
sterling.
The principal accounting policies are summarised below. They
have been applied consistently throughout the period covered by
these financial statements.
2.1. Measurement basis
The measurement basis used in the preparation of the financial
statements is the historical cost basis except for the following
material items in the statement of financial position:
-- derivative financial instruments are measured at fair value;
-- non-derivative financial instruments at fair value through
the profit or loss are measured at fair value; and
-- available for sale financial assets are measured at fair value.
2.2. Accounting principles, amendments and interpretations not yet effective
At the financial position date the following significant
Standards and Interpretations, which are applicable to the company,
were in issue but not yet effective:
IFRS 7 "Disclosures - Transfers of Financial Assets" is
concerned with increased disclosure requirements for transactions
involving transfers of financial assets. These amendments are
intended to provide greater transparency around risk exposures when
a financial asset is transferred but the transferor retains some
level of continuing exposure in the asset. The amendments also
require disclosures where transfers of financial assets are not
evenly distributed throughout the period.
IFRS 9 "Financial Instruments" is concerned with the
classification and measurement of financial assets and liabilities
when determining whether financial assets should be recorded at
amortised cost or at fair value, and the associated accounting
treatment of embedded derivatives within financial assets. The
standard is applicable for accounting periods beginning on or after
1 January 2015 but early adoption is allowed.
IFRS 10 "Consolidated Financial Statements" is effective for
accounting periods beginning on or after 1 January 2014. The
standard establishes the principles for the presentation and
preparation of consolidated financial statements when an entity
controls one or more other entities. The new standard provides
extensive guidance on applying the principle of control, which then
governs the consolidation of an entity. The standard sets out the
accounting requirements for the preparation of consolidated
financial statements, which are unchanged from those that are
required by the current IAS 27, 'Consolidated and Separate
Financial Statements'. However IAS 27 has been amended to conform
to IFRS 10, and will only apply to separate financial statements
when IFRS 10 is applied.
IFRS 11 "Joint Arrangements" is effective for accounting periods
beginning on or after 1 January 2014. The standard applies to all
entities that are a party to a joint arrangement and will replace
IAS 31 Interests in Joint Ventures'. The accounting treatment is
dependent on the type of joint arrangement, which is determined by
considering the rights and obligations of the investor. On
application of IFRS 11, IAS 28 is amended and retitled to
'Investment in Associates and Joint Ventures'.
IFRS 12 "Disclosures of Interests in Other Entities" is
effective for accounting periods beginning on or after1 January
2014. The standard requires disclosure of information on the nature
of, and risks associated with, interests in other entities; and the
effects of those interests on the primary financial statements. The
disclosures required relate to interests in subsidiaries, joint
arrangements, associates and unconsolidated structured
entities.
IFRS 13 "Fair Value Measurement" provides guidance on how to
measure fair value when it is required or permitted by other IFRS's
and contains extensive disclosure requirements to enable users of
financial statements to assess the methods used by entities when
developing fair value measurements and the effects of such
measurements on financial results. The standard is applicable for
accounting periods beginning on or after January 1, 2013 but early
adoption is allowed.
The directors do not anticipate that the adoption of Standards
and Interpretations in issue but not yet effective will have a
material impact on the financial statements.
2.3. Basis of consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
(its subsidiaries). Control is achieved where the Company has the
power to govern the financial and operating policies of an entity
so as to obtain benefits from its activities.
Income and expenses of subsidiaries acquired or disposed of
during the year are included in the consolidated statement of
income from the effective date of acquisition and up to the
effective date of disposal, as appropriate. Total comprehensive
income of subsidiaries is attributed to the owners of the Company
and to the non-controlling interests even if this results in the
non-controlling interests having a deficit balance.
When necessary, adjustments are made to the financial statements
of subsidiaries to bring their accounting policies into line with
those used by other members of the Group.
All intra-group transactions, balances, income and expenses are
eliminated in full on consolidation.
2.4. Judgement and estimates
The preparation of financial statements in conformity with IFRS
requires the Directors to make judgements, estimates and
assumptions that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. The estimates
and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the
judgements about carrying values of assets and liabilities that are
not readily apparent from other sources. Actual results may differ
from these estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised in
the period in which the estimate is revised if the revision affects
only that period, or in the period of the revision and future
periods if the revision affects both current and future
periods.
The key judgement areas relate to the carrying value of the
plant and equipment and goodwill. The carrying value of the
PMSS(TM) units may significantly differ from their market value. It
is affected by management's assessment of its fair value and
indicators of impairment. If the carrying value of a PMSS(TM)
exceeds the recoverable amount then an impairment charge is
recognised. Goodwill is reviewed annually for indication of
impairment.
2.5. Tangible fixed assets
Tangible fixed assets are stated at cost less depreciation and
any provision for impairment. Cost includes the purchase price,
including import duties, non-refundable purchase taxes and directly
attributable costs incurred in bringing the asset to the location
and condition necessary for it to be capable of operating in the
manner intended. Cost also includes capitalised interest on
borrowings, applied only during the period of construction.
Fixed assets are depreciated on a straight line basis over 15
years from the point at which the equipment is deployed and put
into use.
2.6. Inventories
Inventories are measured at the lower of cost and net realisable
value. The cost of inventories is based on the first in first out
principle and includes expenditure incurred in acquiring the
inventories and other costs incurred in bringing them to their
existing location and condition.
The net realisable value is the cost less any impairment
recognised. Inventories are expensed as utilised in the Group's
operations.
2.7. Impairment of Assets
An assessment is made at each reporting date of whether there is
any indication of impairment of any asset, or whether there is any
indication that an impairment loss previously recognised for an
asset in a prior period may no longer exist or may have decreased.
If any such indication exists, the asset's recoverable amount is
estimated. An asset's recoverable amount is calculated as the
higher of the asset's value in use or its net selling price.
An impairment loss is recognised only if the carrying amount of
an asset exceeds its recoverable amount. An impairment loss is
charged to the statement of income in the period in which it
arises. A previously recognised impairment loss is reversed only if
there has been a change in the estimates used to determine the
recoverable amount of an asset, however not to an amount higher
than the carrying amount that would have been determined (net of
any depreciation / amortisation), had no impairment loss been
recognised for the asset in a prior period. A reversal of an
impairment loss is credited to the statement of income in the
period in which it arises.
2.8. Investments
Available for sale investments are initially measured at cost,
including transaction costs. Gains and losses arising from changes
in fair value of available for sale investments are recognised
directly in other comprehensive income, until the security is
disposed or is deemed to be impaired, at which time the cumulative
gain or loss previously recognised in other comprehensive income is
included in the statement of income for the period.
2.9. Revenue
Revenue is measured at the fair value of the consideration
received or receivable. Revenue is reduced for estimated customer
returns, rebates and other similar allowances.
Revenue relates substantially to amounts earned in relation to
geophysical project management and technical consultancy services
and the deployment and operation of the PMSS(TM) equipment. Revenue
is recognised by reference to the stage of completion of the
contract.
2.10. Taxation
The Company is incorporated in the BVI as an IBC and as such is
not subject to tax in the BVI.
WGP Exploration Ltd is incorporated in the UK and is therefore
subject to UK tax regulations. Current tax assets and liabilities
are measured at the amount expected to be recovered from or paid to
the taxation authorities, based on tax rates and laws that are
enacted or substantively enacted by the balance sheet date. Tax is
charged or credited directly to equity if it relates to items that
are credited or charged to equity. Otherwise tax is recognised in
the income statement.
2.11. Foreign currency
Transactions in currencies other than the entity's functional
currency (foreign currencies) are recorded at the rate of exchange
prevailing on the dates of the transactions. At each reporting
date, monetary assets and liabilities that are denominated in
foreign currencies are retranslated at the rates prevailing on the
financial position date. Exchange differences arising are included
in the statement of income for the period. Exchange differences on
the retranslation of operations denominated in foreign currencies
are included in Other Comprehensive Income.
2.12. Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of qualifying assets are added to the
cost of those assets until such a time as the assets are
substantially ready for their intended use or sale. All other
borrowing costs are recognised in profit and loss in the period
incurred.
2.13. Financial instruments and risk management
Financial assets and liabilities are recognised on the Group's
statement of financial position when the Group becomes party to the
contractual provisions of the instrument.
Loans and receivables are initially measured at fair value and
are subsequently measured at amortised cost, plus accrued interest,
and are reduced by appropriate provisions for estimated
irrecoverable amounts. Such provisions are recognised in the
statement of income.
Trade receivables are initially measured at fair value and are
subsequently measured at amortised cost, do not carry any interest,
and are reduced by appropriate provisions for estimated
irrecoverable amounts. Such provisions are recognised in the
statement of income.
Cash and cash equivalents comprise cash in hand and demand
deposits and other short-term highly liquid investments with
maturities of three months or less at inception that are readily
convertible to a known amount of cash and are subject to an
insignificant risk of changes in value.
Trade payables are not interest-bearing and are initially valued
at their fair value and are subsequently measured at amortised
cost.
Equity instruments are recorded at fair value, being the
proceeds received, net of direct issue costs.
Financial instruments require classification of fair value as
determined by reference to the source of inputs used to derive the
fair value. This classification uses the following three-level
hierarchy:
Level 1 - quoted prices (unadjusted) in active markets for
identical assets or liabilities;
Level 2 - inputs other than quoted prices included within level
1 that are observable for the asset or liability, either directly
(i.e., as prices) or indirectly (i.e., derived from prices);
Level 3 - inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
2.14. Share Based Payments
Fair valued share based payments
Where new share options have been granted in the period, a
charge is made to the consolidated statement of income and a
reserve created to record the fair value of the awards in
accordance with IFRS 2 'Share-based Payment'. A charge is
recognised in the income statement in relation to share options
granted based on the fair value (the economic value) of the grant,
measured at the grant date. The charge is spread over the vesting
period. The valuation methodology takes into account assumptions
and estimates of share price volatility, future risk-free interest
rate and exercise behaviour and is based on the Black-Scholes
method. When share options are exercised there is a transfer from
the share option reserve to share capital and share premium
account.
At the end of each reporting period the Group revises its
estimate of the number of share options that are expected to vest
taking into account those which have lapsed or been cancelled. It
recognises the impact of the revision to original estimates, if
any, in the profit or loss, with a corresponding adjustment to
share option reserve.
Intrinsically valued share based payments
The intrinsic value model is applied where fair value cannot be
reliably estimated. Share options are measured at intrinsic value,
initially at the date granted and subsequently at each reporting
date until the corresponding options are exercised, forfeited or
lapse. The effects of revaluations are recognised in the statement
of income.
Refer to Note 15 for details of all share-based payments.
2.15. Business Combinations
Acquisitions of businesses are accounted for using the
acquisition method. The consideration transferred in a business
combination is measured at fair value, which is calculated as the
sum of the acquisition-date fair values of the assets transferred
by the Group, liabilities incurred by the Group to the former
owners of the acquiree and the equity interests issued by the Group
in exchange for control of the acquiree. Acquisition-related costs
are generally recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired and
the liabilities assumed are recognised at their fair value.
Goodwill is measured as the excess of the sum of the
consideration transferred, the amount of any non-controlling
interests in the acquiree, and the fair value of the acquirer's
previously held equity interest in the acquiree (if any) over the
net of the acquisition-date amounts of the identifiable assets
acquired and the liabilities assumed.
2.16. Goodwill
Goodwill arising on an acquisition of a business is carried at
cost as established at the date of acquisition of the business (see
note 2.15 above) less accumulated impairment losses, if any.
For the purposes of impairment testing, goodwill is allocated to
each of the Group's cash-generating units (or groups of
cash-generating units) that is expected to benefit from the
synergies of the combination
A cash-generating unit to which goodwill has been allocated is
tested for impairment annually, or more frequently when there is
indication that the unit may be impaired. If the recoverable amount
of the cash-generating unit is less than its carrying amount, the
impairment loss is allocated first to reduce the carrying amount of
any goodwill allocated to the unit and then to the other assets of
the unit pro rata based on the carrying amount of each asset in the
unit. Any impairment loss for goodwill is recognised directly in
profit or loss in the consolidated statement of income. An
impairment loss recognised for goodwill is not reversed in
subsequent periods.
On disposal of the relevant cash-generating unit, the
attributable amount of goodwill is included in the determination of
the profit or loss on disposal.
3. Operating profit for the year
The operating profit for the year is stated after charging:
2012 2011
US$ US$
Consultancy fees 244,072 202,912
Wages and salaries 998,370 164,204
Social security costs 129,414 15,826
Pension costs 56,977 4,334
Audit fees 46,396 39,370
Included within consultancy fees / wages and salaries is US$
4,000 in relation to amounts paid for non-executive directors'
remuneration (2011: US$ 3,000).
4. Net financial income/(expense)
2012 2011
US$ US$
Interest on bank deposits 1,236 1,688
Bank interest payable (37,762) (2,776)
Loan interest payable - (20,620)
Foreign currency gains / (losses) (193,025) 31,292
Investment Income 1,397 1,379
--------- --------
(228,154) 10,963
--------- --------
5. Earnings per share
2012 2011
The calculation of earnings per share is based on
the following profit and number of shares:
Profit for the period (US$) 1,203,184 355,675
Weighted average number of shares of the Company:
Basic 9,914,407 7,526,823
Diluted 11,875,527 9,794,344
Earnings per share:
Basic (US$) 0.12 0.05
Diluted (US$) 0.10 0.04
Number of shares outstanding at the period end:
Number of shares in issue 13,317,522 11,188,707
Treasury shares (1,462,000) (1,462,000)
----------- -----------
Basic number of shares in issue 11,855,522 9,726,707
----------- -----------
Share options 200,000 2,125,000
----------- -----------
Diluted number of shares in issue 12,055,522 11,851,707
----------- -----------
6. Segment information
The Group has a single operating segment being operations from
geophysical project management and services and one geographical
segment, being the global market as a whole, as the Group's asset
deployment is not limited to a specific area of the world.
7. Related party transactions
Under the consultancy and administrative services agreement
entered into on 23 July 2008 with a company in which the Chairman
has a beneficial interest, the Group was invoiced US$ 440,000 for
consultancy and administrative services provided to the Group
including US$ 200,000 of consultancy fees. An additional $1,000 of
Director fees were also invoiced to the Group. At 31 December 2012,
an amount of US$125,138 of fees brought forward from the prior
period and US$ 20,154 in interest owed to this company were waived.
As at 31 December 2012, the amount owed to this company was US$
258,283 (2011: US$ 125,138).
8. Tangible fixed assets
2012 2011
Plant and Equipment US$ US$
Cost
Cost at 1 January 7,943,129 7,749,869
Assets acquired from the acquisition of WGP - 13,252
Additions 1,397,764 180,008
----------- ---------
Cost at 31 December 9,340,893 7,943,129
Depreciation
Depreciation at 1 January (924,342) (26,520)
Exchange adjustments - (151)
Charge for the period (562,695) (398,611)
Impairment during the period - (499,060)
----------- ---------
Depreciation at 31 December (1,487,037) (924,342)
----------- ---------
Closing net book value at 31 December 7,853,856 7,018,787
----------- ---------
As outlined in note 2.7, an assessment is made at each financial
position date as to whether there is any indication of impairment
of any asset. An impairment review of the equipment has been
undertaken and the management have concluded that there is no
additional impairment charge to be recorded for the period.
9. Investments - Available for sale investments
2012 2011
US$ US$
Available for sale investments
At the beginning of the period - -
Acquisitions 38,675 -
Disposals - -
------ ----
At 31 December 38,675 -
------ ----
Financial instruments require classification of fair value as
determined by reference to the source of inputs used to derive the
fair value. At the point of acquisition, the investment was
classified as Level 1, as it was listed on a recognised stock
exchange, but subsequently reclassified to Level 3 following its
de-listing. The valuation is based on the value at acquisition.
10. Inventories
2012 2011
US$ US$
Parts and Equipment 81,777 -
------ ----
At 31 December 81,777 -
------ ----
11. Trade and other receivables
2012 2011
US$ US$
Trade debtors 133,846 386,226
Other debtors 409,346 97,882
Prepayments 84,886 74,273
------- -------
Total trade and other receivables 628,078 558,381
------- -------
12. Trade and other payables
2012 2011
US$ US$
Trade creditors 1,080,722 288,168
Other creditors 74,164 90,220
Corporation tax payable - 154,530
Accruals 18,953 373,891
--------- -------
Total trade and other payables 1,173,839 906,809
--------- -------
13. Share capital and share premium
2012 2011
US$ US$
Authorised share capital:
100,000,000 ordinary shares of $0.01 each 1,000,000 1,000,000
--------- ---------
Allotted, issued and fully paid:
8,500,000 ordinary shares of $0.01 each 85,000 85,000
2,688,707 ordinary shares of $0.01 each 26,887 26,887
3,815 ordinary shares of $0.01 each issued during the period 38 -
2,125,000 ordinary shares of $0.01 each issued during the period 21,250 -
13,317,522 ordinary shares of $0.01 each 133,175 111,887
--------- ---------
Number of shares Share capital Share premium Treasury shares
Balance at 1 January 2012 11,188,707 111,887 8,517,782 (384,226)
Cost of share issues 2,128,815 21,288 - -
---------------- ------------- ------------- ---------------
Balance at 31 December 2012 13,317,522 133,175 8,517,782 (384,226)
---------------- ------------- ------------- ---------------
Share capital represents 13,317,522 ordinary shares of US$ 0.01
each.
Share premium relates to 8,490,000 shares issued with a nominal
value of US$ 0.01 issued at a price of US$ 1.00, plus consideration
for the acquisition of WGPE US$ 1,253,368 less costs of issue
amounting to US$ 1,279,466.
Treasury shares represents the cost of the Company buying back
its shares. There were 1,462,000 shares held in Treasury as at 31
December 2012.
Other reserves represents the exchange differences on
retranslation of foreign operations.
On 2 July 2012, the Company issued 3,815 ordinary shares as
consideration for 164,205 Rock Solid Images Plc shares.
On 22 November 2012, the Company issued 2,125,000 ordinary
shares, granted under a deed dated 23 July 2008 in relation to the
Chairman's founder options.
The holders of issued shares are entitled to receive dividends
as declared from time to time and are entitled to one vote per
share at meetings of the Company. All shares rank equally with
regard to the Company's residual assets.
14. Capital Management
The Group's capital comprises ordinary share capital, retained
earnings and capital reserves, the group has no debt. The Group's
objectives when managing capital are to provide an optimum return
to shareholders over the short to medium term through capital
growth and income whilst ensuring the protection of its assets by
minimising risk. The Group seeks to achieve its objectives by
having available sufficient cash resources to meet capital
expenditure and ongoing commitments.
At 31 December 2012, the Group had capital of US$ 10,279,541
(2011: US$ 9,009,709). The Group does not have any externally
imposed capital requirements.
15. Share - based payments
Thalassa Holdings Ltd share options
Director Non - Executive director
share share
Founding shareholder options options options Other share options
15.1 15.2 15.3 15.4
Outstanding at 1 January 2012 2,125,000 - - -
Options granted - 100,000 20,000 80,000
Options lapsed - - - -
Options exercised 2,125,000 - - -
---------------------------- -------- ------------------------ -------------------
Outstanding at 31 December 2012 - 100,000 20,000 80,000
---------------------------- -------- ------------------------ -------------------
Exercise price US$0.01 GBP0.521 GBP0.521 GBP0.521
15.1. Founding shareholder options
On 23 July 2008 Duncan Soukup was granted a five year option to
subscribe for 2,125,000 shares at US$0.01 per share. These options
have no impact on reported profit or loss as they were issued in
the capacity as a holder of equity shares in the Company and, as
such, are not a share based payment transaction.
Duncan Soukup exercised all of his founder's options during the
year to 31 December 2012.
15.2. Director Share Options
On 21 November 2012 100,000 share options were granted to Duncan
Soukup at a strike price of GBP0.521. The options have been granted
for a period of three years.
15.3. Non-Executive Director share options
On 21 November 2012 20,000 share options were granted to
Non-executive Directors at a strike price of GBP0.521. The options
have been granted for a period of three years.
15.4. Employee and Consultant share options
On 21 November 2012 80,000 share options were granted to
employees and consultants at a strike price of GBP0.521. The
options have been granted for a period of three years.
15.5. Share options in WGP Energy Services Ltd granted to
employees of WGP
WGP Energy Services Ltd share options
Employees of WGP share options
Outstanding at 1 January 2012 91,000
Options granted -
Options lapsed -
Options exercised -
------------------------------
Outstanding at 31 December 2012 91,000
------------------------------
On 23 July 2008, certain employees of WGP were granted five year
options in respect of a total of up to 100,000 ordinary shares of
WESL at US$1.00 per share, representing 1.4% of WESL's issued share
capital.
None of the WGP employee options were exercised or lapsed during
the year to 31 December 2012.
15.6. Share option charges
On 21 November 2012, 200,000 share options were granted and were
valued using the Black-Scholes option pricing model. The total fair
value of the options granted has been estimated at GBP34,400 based
on a fair value per option of GBP0.177. The principal inputs into
the model were as follows:
2012 2011
Number of Options Granted 200,000 n/a
Vesting Period 3 years n/a
Option strike price GBP0.521 n/a
Current share price (at granting date) GBP0.521 n/a
Implied volatility 50.0% n/a
Interest free rate 0.5% n/a
The volatility is based on historical volatility of the Group's
shares in a range between 40-50% considering the general stock
market conditions and the industry.
16. Investment in subsidiaries
Details of the Company's subsidiaries at the year end are as
follows:
Effective
Share holding
Name of subsidiary Place of incorporation 2012 2011
WGP Group Ltd British Virgin Islands 100% n/a
WGP Energy Services Ltd British Virgin Islands 100% 100%
WGP Exploration Limited United Kingdom 100% 100%
WGP Technical Services Ltd British Virgin Islands 100% n/a
WGP Survey Ltd British Virgin Islands 50% n/a
WGP Group Ltd was incorporated 14 February 2012 as a 100% owned
subsidiary of Thalassa Holdings Ltd. WGP Energy Services Ltd and
WGP Exploration Limited are now 100% owned subsidiaries of WGP
Group Ltd.
17. Financial instruments
The Group's financial instruments comprise cash and cash
equivalents together with various items such as trade and other
debtors and trade creditors etc, that arise directly from its
operations. The fair value of the financial assets and liabilities
approximates the carrying values disclosed in the financial
statements. Included within cash and cash equivalents is an amount
of GBP100,000 (2010: GBP100,000) which is pledged as a performance
bond in relation to sales contracts with a particular customer.
The main risks arising from the Group's financial instruments
are interest rate risk, foreign exchange risk, credit risk and
liquidity risk.
Interest rate risk
The Group does not undertake any hedging against interest rate
risk. The Group finances its operations from the cash balances on
the current and deposit accounts. The Group has no borrowings as at
31 December 2012.
Foreign exchange risk
The Group undertakes hedging activities from time to time to
mitigate foreign exchange risk.
An increase in foreign exchange rates of 5% at 31 December 2012
would have decreased the profit and net assets by US$ 95,360 (2011:
US$ 7,645). A decrease of 5% would have had an equal and opposite
impact. The majority of the Group's balances are held in USD.
Approximately 6% of amounts owing to suppliers are held in GBP, 14%
in NOK and 6% in EUR.
Credit risk
The Group's exposure to credit risk is influenced mainly by
individual characteristics of each customer rather than the
industry or country in which the customers operate and therefore
concentrations of credit risk primarily arise when the Company has
significant exposure to individual customers. There is a
concentration of credit risk in respect of amounts receivable due
to the low volume, high value nature of the Company's contracts.
The maximum credit risk exposure relating to financial assets is
represented by their carrying value as at the year end date. The
company's customers are large multinational oil and gas companies.
The company has established procedures to minimise the risk of
default on trade receivables.
The significant proportion of the Group's revenue was generated
from 3 customers in the period. At the end of the reporting period
there were no amounts outstanding from these 3 customers.
Liquidity risk
The Group's strategy for managing cash is to maximise interest
income whilst ensuring its availability to match the profile of the
Group's expenditure. Based on current forecasts the Group has
sufficient cash to meet future obligations.
18. Subsequent events
On 18 January 2013, the Company announced that its subsidiary,
WGP Energy Services Ltd entered into a contract with SMG Ecuador,
the Ecuador business of State Sevmorgeo Company ("SMG"), the
Russian geological survey company with an initial value of US$
4.175m involving the provision and operation of the PMSS(TM) as
part of seismic data acquisition surveys being conducted in
Ecuador.
On 6 February 2013, the Company announced that it had entered
into a supplemental contract with SMG to supply 11 containers
containing ocean bottom nodes and instrument rooms as part of
seismic data acquisition surveys in Ecuador.
On 27 February 2013, the Company announced that its WGP
subsidiary had received and executed a letter of intent with
Statoil AS. The seismic acquisition contract, excluding any
extensions, is approximately US$ 32m and up to approximately US$
65m if Statoil exercises the options to extend the contract by a
further four years. The letter of intent also covers Statoil's
purchase of a bespoke dual portable modular system (D-PMSS(TM) ),
which WGP shall maintain and operate throughout the duration of the
acquisition contract. The value of this contract is US$ 19.8m.
On 27 February 2013, the Company announced additional
supplemental contracts to supply additional services and a vessel
as part of seismic data acquisition surveys being conducted by SMG
in Ecuador.
On 21 March 2013, the Company announced that its subsidiary, WGP
Energy Services Ltd had entered a further agreement with SMG to
supply node handling equipment and associated services as part of
seismic data acquisition surveys being conducted by SMG
Ecuador.
19. Copies of the consolidated financial statements
A copy of the Annual Report and Financial Statements has been
posted to shareholders today. Further copies are also available on
the Company's website: www.thalassaholdingsltd.com
20. Annual General Meeting
The Annual General Meeting will be held at Le Cabanon, Pointe
des Douaniers, 06320 Cap d'Ail, France on 2 May 2013 at 12.00 noon.
The Notice of AGM is contained within the Annual Report.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR PGUWWWUPWGRA
Thalassa (LSE:THAL)
Gráfico Histórico do Ativo
De Jun 2024 até Jul 2024
Thalassa (LSE:THAL)
Gráfico Histórico do Ativo
De Jul 2023 até Jul 2024
