TIDMTHAL
RNS Number : 4076K
Thalassa Holdings Limited
30 July 2013
Thalassa Holdings Ltd
(Reuters: THAL.L, Bloomberg: THAL:LN)
("Thalassa" or the "Company")
Results for the 6 months to 30 June 2013
The Company is pleased to announce its financial results for the
6 months ended 30 June 2013. A summary of the results is set out
below.
Financial Highlights
-- Revenue up 193% to US$11.6m (1H12: US$4.0m).
-- Operating Profit up 272% to US$1.3m (1H12: US$0.4m).
-- Net Profit up 206% to US$1.0m (1H12: US$0.3m).
-- Earnings Per Share (diluted) up 115.3% to US$0.07 (GBP0.05) (1H12: US$0.03 (GBP0.02)).
-- Book value per share (diluted) up 46.8% to US$1.16 (GBP0.76) (1H12: US$0.79 (GBP0.50)).
-- Placement of 4.5m shares at GBP1.20 per share, raising gross proceeds of GBP5.4m.
-- Cash as at 30 June 2013 US$16.8m (FY12: US$2.5m).
-- No borrowings as at 30 June 2013 (FY12: US$nil).
Operational Highlights
-- Statoil Contract awarded for the manufacture of a new Dual
Portable Modular Source System ("D-PMSS(TM)") for US$19.8m and for
the provision of long term seismic acquisition services for
permanent reservoir monitoring of the Snorre and Grane oil fields
in the Norwegian sector of the North Sea for up to US$65.0m.
-- Manufacture of the D-PMSS(TM) unit for Statoil underway.
-- Completion of the first phase of the seismic data acquisition
surveys conducted in Ecuador on behalf of Sevmorgeo S.A., a
subsidiary of Joint Stock Company Sevmorgeo ("SMG").
-- Contract with SMG in Ecuador extended into 2H 2013 and 1H
2014 for a further US$4.0m to US$5.4m.
Chairman's Statement
Overview
I am pleased to present shareholders with another set of record
results.
2012 was an exceptional year for Thalassa and strengthened the
foundation for the growth we are now enjoying in 2013. I would like
to point out to our shareholders that WGP has been working in
Permanent Reservoir Monitoring ("PRM") for over 10 years and is
now, finally, reaping the benefit of early recognition of an
untapped growth area in the marine geophysical market.
Recognition, even from within the industry, of the clear
benefits of "production enhancement" techniques has been remarkably
slow. Fortunately, however, this is now changing rapidly and
industry insiders now estimate that the PRM market has the
potential to grow to US$20bn over the next 30 years peaking in
2025.
In February, we announced the award of a manufacturing contract
from Statoil, Norway as well as a 5 year service contract with 2
two year options to extend. Production of a D-PMSS(TM) is well
advanced and we anticipate delivery in time for the commencement of
the first shoot scheduled for October this year. Whilst the terms
of the contract are confidential I can say that there is a
potential for repurchase of the D-PMSS(TM) during the life of the
project or upon its termination.
The first phase of the contract with SMG in Ecuador, involving
the provision and operation of Thalassa's D-PMSS(TM) as part of
seismic data acquisition surveys being conducted in Ecuador was
completed. As announced 4 June 2013, I am delighted that SMG has
agreed to extend the initial contract entered into on 18 January
2013 which will increase the aggregate value of the work in Ecuador
to more than US$10.0m. The work is expected to commence in October
2013 and continue until the April 2014.
The increase in trade and other receivables in the period is
predominantly due to the SMG project in Ecuador. We expect
settlement of the receivables once mobilisation of the second phase
of the project commences.
Outlook
2H 2013
Our current book of business means that the 2H of 2013 should
result in a year of further significant progress for the Group and
should also result in a healthy net cash balance at year-end
earmarked for internal growth.
2014/15
The Company's current level of order-enquiry and tenders
submitted for 2014/2015 delivery is in excess of US$100m (1H12:
US$38m). Whilst this is a truly enviable situation to be in, the
Company's young management team will face the dual challenges of
managing a rapid increase in personnel needs, with all the problems
associated therewith, as well as increased capital requirements
needed to fund the ever increasing size of contract opportunities
that we are receiving.
In other words, we are in great shape, with accelerating growth
potential but need to be mindful of the risks associated with
significant growth.
On behalf of our shareholders, I would like to thank the staff
for their continued commitment, dedication and performance.
Financial Review
Group results for the six months to 30 June 2013 show revenue of
US$11.6m, an increase of 193% compared to the first half of 2012
(1H12: US$4.0m). Gross Profit in the half year was US$3.9m, a 109%
increase compared to 1H12 (US$1.9m). Operating profit (EBIT) was
US$1.3m, an increase of 272% from 1H12 (US$0.4m). Profit for the
financial period attributable to shareholders of the parent was
US$1.0m, an increase of 206% over the prior period (US$0.3m).
Basic earnings per share was US$0.07 (GBP0.05) and diluted
earnings per share was US$0.07 (GBP0.05) as compared to basic
earnings per share of US$0.04 (GBP0.03) and diluted earnings per
share of US$0.03 (GBP0.02) in the prior period, an increase of
67.7% and 115.3% respectively. This is calculated using the
weighted average number of shares outstanding, on a basic basis
using 13,730,522 shares outstanding (1H12: 7,526,823) and on a
diluted basis using 13,913,567 shares outstanding (1H12:
9,794,344), an increase of 82.4% and 42.1% respectively.
Revenue of US$11.6m generated from operations includes US$7.0m
from the project in Ecuador for SMG and US$4.5m recognized in the
period in relation to the manufacture of the dual portable modular
source system ("D-PMSS(TM)") for Statoil.
Cost of sales of US$7.7m 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 for the project in Ecuador and costs
associated with the manufacturing the D-PMSS(TM) system.
Administrative expenses of US$2.3m increased from US$1.4m in the
prior period. The increase in administrative expenses is
commensurate with the expansion of the business and the growth in
revenue seen in the first half of 2013. 1H13 represents 19.7% of
revenue as compared to 34.2% in 1H12.
Operating profit before depreciation was US$1.6m compared to
US$0.5m for the comparative period.
The depreciation charge of US$0.3m (US$0.1m) in the period
relates to the two owned PMSS(TM) units plus the two compressors
purchased in the prior period. An assessment of the equipment was
undertaken in the period as part of the annual impairment review
and concluded that no impairment charge was required in the period
(1H12: US$nil).
Net financial income/(expense) of US$0.07m includes foreign
exchange gains in the period offset by interest expense.
Tax includes an estimate of the tax liability incurred in the
first half from the Group's operations across its different regions
of activity.
Net assets at 30 June 2013 amounted to US$19.1m (FY12:
US$10.3m). Net asset value per share (diluted) was US$1.16
(GBP0.76) in comparison to US$0.85 (GBP0.53) for FY12 and US$0.79
(GBP0.50) for 1H12.
Net cash flow from operating activities amounted to US$7.7m. Net
cash flow from financing activities was US$6.6m relating to the
issue of new shares in the period as part of the share placement.
New Ordinary Shares totaling 4,500,000 were issued at GBP1.20 per
share raising gross proceeds of GBP5.4m.
The Company had no borrowings during the period.
Cash at the period end was US$16.8m (FY12: US$2.5m).
Consolidated Income Statement
For the six months ended 30 June 2013
Six months Six months Year
ended ended ended
30 Jun 2013 30 Jun 2012 31 Dec 2012
Unaudited Unaudited Audited
Note US$ US$ US$
Continuing operations
Revenue 11,643,218 3,978,560 14,007,070
Cost of sales (7,737,486) (2,113,888) (9,067,000)
----------- ----------- -----------
Gross profit 3,905,732 1,864,672 4,940,070
----------- ----------- -----------
Administrative expenses (2,293,916) (1,362,788) (2,896,329)
----------- ----------- -----------
Operating profit before depreciation 1,611,816 501,884 2,043,741
----------- ----------- -----------
Depreciation (298,400) (149,187) (562,695)
----------- ----------- -----------
Operating profit 1,313,416 352,697 1,481,046
----------- ----------- -----------
Net Financial Income / (Expense) 72,922 (1,040) (228,154)
----------- ----------- -----------
Profit before taxation 1,386,338 351,657 1,252,892
----------- ----------- -----------
Taxation (358,632) (15,666) (3,503)
----------- ----------- -----------
Profit for the financial period 1,027,706 335,991 1,249,389
----------- ----------- -----------
Non-controlling interest - - (46,205)
----------- ----------- -----------
Profit attributable to shareholders of the parent 1,027,706 335,991 1,203,184
----------- ----------- -----------
Earnings per share
Basic (US$) 3 0.07 0.04 0.12
----------- ----------- -----------
Diluted (US$) 3 0.07 0.03 0.10
----------- ----------- -----------
Earnings per share
Basic (GBP) 3 0.05 0.03 0.08
----------- ----------- -----------
Diluted (GBP) 3 0.05 0.02 0.06
----------- ----------- -----------
Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2013
Six months Six months Year
ended ended ended
30 Jun 2013 30 Jun 2012 31 Dec 2012
Unaudited Unaudited Audited
US$ US$ US$
Profit for the financial period 1,027,706 335,991 1,203,184
Other comprehensive income:
Exchange differences on re-translation
of foreign operations (39,119) (10,427) (845)
--------------------------------------- ----------- ----------- -----------
Total comprehensive income 988,587 325,564 1,202,339
--------------------------------------- ----------- ----------- -----------
Consolidated Statement of Financial Position
At 30 June 2013
At At At
30 Jun 2013 30 Jun 2012 31 Dec 2012
Unaudited Unaudited Audited
US$ US$ US$
ASSETS
Non-current assets
Goodwill 368,525 368,525 368,525
Tangible fixed assets 7,591,232 7,913,479 7,853,856
Available for sale investments 38,675 35,888 38,675
----------- ----------- -----------
Total non-current assets 7,998,432 8,317,892 8,261,056
----------- ----------- -----------
Current assets
Inventory 1,446,000 - 81,777
Loans and receivables 763,000 - -
Trade and other receivables 5,239,580 2,448,537 628,078
Cash and cash equivalents 16,837,567 1,943,226 2,482,469
----------- ----------- -----------
Total current assets 24,286,147 4,391,763 3,192,324
----------- ----------- -----------
LIABILITIES
Current liabilities
Trade and other payables 3,787,841 3,374,382 1,173,839
Deferred revenue 9,369,196 - -
----------- ----------- -----------
Total current liabilities 13,157,037 3,374,382 1,173,839
----------- ----------- -----------
Net current assets 11,129,110 1,017,381 2,018,485
----------- ----------- -----------
Net assets 19,127,542 9,335,273 10,279,541
----------- ----------- -----------
EQUITY
Shareholders Equity
Share capital 178,175 111,887 133,175
Share premium 16,332,196 8,517,782 8,517,782
Treasury shares (384,226) (384,226) (384,226)
Other reserves (58,768) (29,231) (19,649)
Retained earnings 3,013,960 1,119,061 1,986,254
----------- ----------- -----------
Total Shareholders Equity 19,081,337 9,335,273 10,233,336
----------- ----------- -----------
Non-controlling interest 46,205 - 46,205
----------- ----------- -----------
Total Equity 19,127,542 9,335,273 10,279,541
----------- ----------- -----------
These financial statements were approved by the board on 29 July
2013.
Consolidated Statement of Cash Flows
For the six months ended 30 June 2013
Six months Six months Year
ended ended ended
30 Jun 2013 30 Jun 2012 31 Dec 2012
Unaudited Unaudited Audited
US$ US$ US$
Cash flows from operating activities
Operating Profit for the period before depreciation 1,611,816 501,884 2,043,741
Non- cash transactions(1) 440,000 - -
(Increase) / Decrease in inventory (1,364,223) - (81,777)
(Increase) / Decrease in trade and other receivables (4,611,502) (1,890,156) (69,697)
Increase / (Decrease) in trade and other payables 2,614,002 2,451,907 267,030
Increase / (Decrease) in deferred revenue 9,369,196 - -
Acquisition of investments - (35,888) -
Net Foreign Exchange gain / (loss) 188,998 (2,845) (193,870)
Taxation (358,632) - (3,503)
------------- ------------ ------------
Cash used by operations 7,889,655 (1,024,902) 1,961,924
Interest paid (155,248) (9,244) (37,762)
------------- ------------ ------------
Net cash flow from operating activities 7,734,407 1,015,658 1,924,162
------------- ------------ ------------
Cash flows from investing activities
Acquisition of Investments - - (38,675)
Investment Income - - 1,397
Interest received 53 621 1,236
Purchase of equipment - (1,043,878) (1,397,764)
Purchase of fixtures and fittings (35,776) - -
------------- ------------ ------------
Net cash flow from investing activities (35,723) (1,043,257) (1,433,806)
------------- ------------ ------------
Cash flows from financing activities
Issue of Ordinary Share Capital 6,656,414 - 21,288
------------- ------------ ------------
Net cash flow from financing activities 6,656,414 - 21,288
------------- ------------ ------------
Net increase / (decrease) in cash and cash equivalents 14,355,098 (27,599) 511,644
Cash and cash equivalents at the start of the period 2,482,469 1,970,825 1,970,825
------------- ------------ ------------
Cash and cash equivalents at the end of the period 16,837,567 1,943,226 2,482,469
------------- ------------ ------------
(1) Non cash transactions includes the shares issued to the Chairman in satisfaction of consultancy
and administrative services (see note 5) and the shares acquired in the Company by the THAL
Discretionary Trust as financed by the Company loan.
Consolidated Statement of Changes in Equity
For the six months ended 30 June 2013 (unaudited)
Retained Total
Share Share Treasury Other earnings Shareholders Minority Total
Capital Premium shares reserves / (losses) Equity interest Equity
US$ US$ US$ US$ US$ US$ US$ US$
Balance as at
1 January 2012 111,887 8,517,782 (384,226) (18,804) 783,070 9,009,709 - 9,009,709
Total comprehensive
income for the
period - - - (10,427) 335,991 325,564 - 325,564
Balance as at
30 June 2012 111,887 8,517,782 (384,226) (29,231) 1,119,061 9,335,273 - 9,335,273
-------------------- -------- ---------- --------- --------- ----------- ------------- --------- ----------
Balance as at
1 January 2013 133,175 8,517,782 (384,226) (19,649) 1,986,254 10,233,336 46,205 10,279,541
Issue of Ordinary
Share Capital 45,000 8,181,429 - - - 8,226,429 - 8,226,429
Placing fees - (367,015) - - - (367,015) - (367,015)
Total comprehensive
income for the
period - - - (39,119) 1,027,706 988,587 - 988,587
-------------------- -------- ---------- --------- --------- ----------- ------------- --------- ----------
Balance as at
30 June 2013 178,175 16,332,196 (384,226) (58,768) 3,013,960 19,081,337 46,205 19,127,542
-------------------- -------- ---------- --------- --------- ----------- ------------- --------- ----------
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 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")
-- WGP Professional Services Ltd ("WGPP")
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 as those
applied by the Company in its consolidated financial statements as
at and for the period ended 31 December 2012 except for the
following:
Revenue Recognition
Revenue is measured at the fair value of the consideration
received or receivable.
In respect of contracts which are long term in nature and
contracts for ongoing services, revenue, restricted to the amounts
of costs that can be recovered, is recognised according to the
value of work done in the period. Revenue in respect of such
contracts is calculated on the basis of time spent on the project
and estimated work to completion. Revenue is recognised when the
following conditions are satisfied:
-- the amount of revenue can be measured reliably;
-- it is probable that the economic benefits associated with the
transaction will flow to the entity;
-- the stage of completion of the transaction at the end of the
reporting period can be measured reliably and is estimated by
expected time-cost to completion; and
-- the costs incurred for the transaction and the costs to
complete the transaction can be measured reliably.
Where the outcome of contracts which are long term in nature and
contracts for ongoing services cannot be estimated reliably,
revenue is recognised only to the extent of the costs recognised
that are recoverable.
Where payments are received in advance in excess of revenue
recognised in the period, this is reflected as a liability on the
statement of financial position as deferred revenue.
Inventory
Costs associated with contracts which are long term in nature
are included in inventories to the extent that they cannot be
matched with contract work accounted for as revenue. Amounts
included in work in progress are stated at cost, after provision
has been made for any foreseeable losses.
2.1. Basis of preparation
The consolidated interim financial information for the six
months ended 30 June 2013 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 2012.
All intra-group transactions, balances, income and expenses are
eliminated in full on consolidation.
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 Year
ended ended ended
30 Jun 2013 30 Jun 2012 31 Dec 2012
Unaudited Unaudited Audited
The calculation of earnings per
share is based on the
following profit / (loss) and number
of shares:
Profit / (loss) for the period (US$) 1,027,706 335,991 1,203,184
----------- ----------- -----------
Weighted average number of shares
of the Company:
Basic 13,730,522 7,526,823 9,914,407
Diluted 13,913,567 9,794,344 11,875,527
Earnings / (loss) per share:
Basic (US$) 0.07 0.04 0.12
Diluted (US$) 0.07 0.03 0.10
Basic (GBP) 0.05 0.03 0.07
Diluted (GBP) 0.05 0.02 0.06
----------- ----------- -----------
4. Loans and receivables
30 Jun 2013 30 Jun 2012 31 Dec 2012
Unaudited Unaudited Audited
US$ US$ US$
Loans and receivables 763,000 - -
----------- ----------- -----------
Loans and receivables includes a loan of GBP500,000 to the THAL
Discretionary Trust upon which interest is payable at 3% per annum
(reviewed periodically to keep in line with market rates).
The THAL Discretionary Trust is a trust, independent of
Thalassa, established for the benefit of individuals or parties to
whom the Directors of the trust wish to make awards at their
discretion.
On April 17 2013, the Trust acquired 416,667 ordinary shares in
the Company at 120 pence per share as financed by the loan from the
company.
5. Related party balances and 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
US$2,000 of Director fees were also invoiced to the Group. At 30
June 2013 the amount owed to this company was US$2,000 (1H12:
US$235,932).
On 17 April 2013, the Chairman acquired 447,750 ordinary shares
of US$0.01 each in the Company at a price of 120 pence per share as
part of the placing announced on 12 April 2013. US$440,000 of the
total proceeds from this transaction were offset against the
consultancy and administrative services invoiced by the company in
which the Chairman has a beneficial interest and the balance of
US$365,950 settled by cash.
6. Share capital and share premium
As at As at
30 Jun 2013 31 Dec 2012
US$ 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 38 38
2,125,000 ordinary shares of $0.01 21,250 21,250
4,500,000 ordinary shares of $0.01 each
issued during the period 45,000 -
----------- -----------
17,817,522 ordinary shares of $0.01 each 178,175 133,175
----------- -----------
Number of Share Treasury
shares capital Share premium shares
Balance at 31 December 2012 13,317,522 133,175 8,517,782 (384,226)
Cost of share issues 4,500,000 45,000 7,814,414 -
---------- -------- ------------- ---------
Balance at 30 June 2013 17,817,522 178,175 16,332,196 (384,226)
---------- -------- ------------- ---------
On 17 April 2013, the Company issued 4,500,000 ordinary shares
of US$0.01 each in nominal value at a price of 120 pence per
Ordinary Share.
7. Post balance sheet events
No material events to report.
8. Copies of the Interim Report
The interim report is available on the Company's website:
www.thalassaholdingsltd.com.
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
www.thalassaholdingsltd.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR NKCDNABKDCOB
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