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Bisichi Plc - Half-year Report

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31 August 2021

BISICHI PLC

Interim Results for the period ended 30 June 2021

For the six months ending 30th June 2021:

· EBITDA [1]: £1.03million (2020: 0.35million loss)

· Adjusted EBITDA [2]: £0.74million (2020: 0.1million)

· Loss before tax £0.7million (2020: £2.0million)

· EPS (basic): 2.78 p loss (2020: 12.66 p loss)

· Total production: 553,000 tonnes (2020: 580,000 tonnes)

· Improved international coal markets help offset difficult mining conditions at the Group’s South African Mining operations in the first half of 2021.

· The Group’s management continue to focus on opportunities to extend the life of mining operations in South Africa, as well as developing new opportunities at the Group’s coal processing plant, Sisonke Coal Processing.

· Invoiced income from the Group’s directly owned UK retail property portfolio was £0.59million (2020: £0.50million) with rental revenue collections improving during the period.

END

For further information, please call:

Andrew Heller/Garrett Casey Bisichi PLC 020 7415 5030

[1] Earnings before Interest, taxation, depreciation and amortisation.

[2] Operating profit before depreciation, fair value adjustments and exchange movements.

Bisichi PLC

Half year review – 30 June 2021

In the wake of the challenges of 2020 arising from the Covid-19 pandemic, we are pleased to report that your management has continued to ensure the Group’s key priorities are addressed. These are the health and safety of our employees and stakeholders, ensuring our operations continued in an efficient manner, and maintaining balance sheet flexibility.

As we reflect back on the last eighteen months, one of the most challenging priorities for your Company has been the continuity of our South African mining and coal processing operations. At the beginning of the crisis, when global coal demand fell, the average weekly price of Free on Board (FOB) Coal from Richard Bay Coal Terminal (API4 price) fell from a high of US$92 in January 2020 to $44 in mid-April 2020. Thereafter, coal prices remained largely supressed until the end of the year. Under these very difficult circumstances, your management has worked tirelessly, along with our key stakeholders, to ensure that our South African operations continued operating in an efficient manner until global economic activity and coal markets improved going into 2021.

During the first half of 2021, we are pleased to report that the improvement in global economic activity had a significant impact on demand for coal in the international market. In the first six months of 2021, the API4 price averaged US$97, compared to $67 in the first six months of 2020 when, as outlined above, demand for coal was particularly impacted by the outbreak of Covid-19. This has had a positive impact on the Group’s operations, particularly our South African coal mining and processing operations. As a result, in the six months ended 30 June 2021, Bisichi PLC made a profit before interest, tax, depreciation and amortisation of £1.03 million (2020: loss of £0.35 million).

Results would have been even better if we had not encountered difficult mining conditions at Black Wattle, our South African mining operation, which impacted adversely our coal production during the period. Nonetheless, the mine achieved production of 553,000 metric tonnes compared to 580,000 metric tonnes in the first half of 2020. Black Wattle’s operating costs during the period were also impacted by the difficult mining conditions, as well as the higher overall cost of mining of the remaining reserves at Black Wattle’s current mining area.

Despite lower output from Black Wattle, at Sisonke Coal Processing, our South African coal processing operation, we were able to take advantage of the improved coal price by increasing overall coal processed and reducing our stockpiles of coal that had built up during the economic downturn of 2020. The overall increase in Group revenue, operating costs and earnings during the first half of the year can mainly be attributable to our coal processing operations.

Looking forward, the Group’s overall mining production in the second half of 2021 is expected to remain at similar levels to the first half of the year. However, plans are in place to move into a new mining area at Black Wattle by the end of 2021, where mining conditions and production are expected to improve. In the interim, the Group will look to keep costs as low as possible while developing new opportunities for Sisonke Coal Processing, to take advantage of the improved coal market conditions seen in 2021 to date. In addition, we continue to work closely with our BEE partner in South Africa, to seek further opportunities to extend the life of mine of our existing mining operations or to develop new independent mining operations in South Africa.

In the UK, although the final impact of the pandemic on the UK property portfolio remains uncertain, in 2021 to date we have seen rental revenue collections improve as tenants begin to resume operating. Overall, the Group billed revenue from our directly owned property portfolio of £0.59million (2020: £0.50million) during the period.

The Group continues to hold its joint venture investment, with London & Associated Properties PLC and Metroprop Real Estate Ltd, in the freehold of a retail and residential redevelopment in West Ealing, London.

As previously announced, planning permission for an expanded residential redevelopment of 56 flats on the site has been received. Planning approval documents for the planning consent are currently being finalised and we look forward to updating shareholders further on the situation in due course.

Finally, during these times, your management continue to do their utmost to ensure the Group’s key priorities as outlined above are delivered. Therefore, until such time as the impact of Covid-19 can be fully assessed, the Board has decided that it will not be proposing an interim dividend. We will review this when there is greater visibility of the ongoing impact of Covid-19.

After what has been an incredibly challenging eighteen months we would like to thank all our employees and stakeholders for their hard work and support during this period.

.

Sir Michael Heller Andrew Heller

Chairman Managing Director

31 August 2021

Bisichi PLC

Consolidated income statement

For the six months ended 30 June 2021

Unaudited

Unaudited

Audited

6 months ended

6 months ended

Year ended

30 June

30 June

31 December

2021

2020

2020

Notes

£000

£000

£000

Group revenue

1

23,639

14,250

29,805

Operating costs

(24,238)

(15,731)

(33,070)

Operating profit on trading activities

(599)

(1,481)

(3,265)

Decrease in value of investment properties

-

-

(1,295)

Gain/(Loss) on investments held at fair value

376

(261)

67

Operating profit

1

(223)

(1,742)

(4,493)

Share of profit/(loss) in joint ventures

(80)

13

(87)

Profit before interest and taxation

(303)

(1,729)

(4,580)

Interest receivable

9

19

25

Interest payable

(392)

(309)

(641)

Profit before taxation

1

(686)

(2,019)

(5,196)

Income tax

2

272

481

1,402

Profit for the period

(414)

(1,538)

(3,794)

Attributable to:

Equity holders of the company

(297)

(1,352)

(3,354)

Non-controlling interest

(117)

(186)

(440)

Profit for the period

(414)

(1,538)

(3,794)

Earnings per share - basic

3

(2.78p)

(12.66p)

(31.42p)

Earnings per share - diluted

3

(2.78p)

(12.66p)

(31.42p)

Bisichi PLC

Consolidated statement of comprehensive income

For the six months ended 30 June 2021

Unaudited

Unaudited

Audited

6 months
ended

6 months
ended

Year
ended

30 June

30 June

31 December

2021

2020

2020

£000

£000

£000

Profit for the period

(414)

(1,538)

(3,794)

Other comprehensive income:

Exchange differences on translation of foreign operations

6

(467)

(467)

Taxation

-

-

-

Other comprehensive income for the period, net of tax

6

(467)

(467)

Total comprehensive income for the period

(408)

(2,005)

(4,261)

Attributable to:

Equity shareholders

(292)

(1,752)

(3,752)

Non-controlling interest

(116)

(253)

(509)

Total comprehensive income for the period

(408)

(2,005)

(4,261)

Bisichi PLC

Consolidated Balance Sheet

as at 30 June 2021

Unaudited

Unaudited

Audited

30 June 2021

30 June 2020

31 December 2020

Assets

£000

£000

£000

Non-current-assets

Value of investment properties

10,270

11,566

10,270

Fair value of head leases

201

184

201

Investment property

10,471

11,750

10,471

Reserves, plant and equipment

9,674

8,786

10,174

Investments in joint ventures

1,174

1,355

1,255

Other investments at fair value through profit and loss (“FVPL”)

2,721

449

1,746

Total non-current assets

24,040

22,340

23,646

Current assets

Inventories

2,593

4,552

3,445

Trade and other receivables

7,659

6,385

6,958

Corporation tax recoverable

-

-

-

Investments in listed securities held at FVPL

923

926

833

Cash and cash equivalents

3,543

4,977

3,768

Total current assets

14,718

16,840

15,004

Total assets

38,758

39,180

38,650

Liabilities

Current liabilities

Borrowings

(3,995)

(4,835)

(5,110)

Trade and other payables

(12,807)

(8,409)

(10,856)

Current tax liabilities

(1)

(317)

(209)

Total current liabilities

(16,803)

(13,561)

(16,175)

Non-current liabilities

Borrowings

(4,076)

(4,180)

(3,943)

Provision for rehabilitation

(1,461)

(1,359)

(1,442)

Finance lease liabilities

(437)

(231)

(427)

Deferred tax liabilities

(200)

(1,404)

(474)

Total non-current liabilities

(6,174)

(7,174)

(6,286)

Total liabilities

(22,977)

(20,735)

(22,461)

Net assets

15,781

18,445

16,189

Equity

Share capital

1,068

1,068

1,068

Share premium

258

258

258

Translation reserve

(2,483)

(2,490)

(2,488)

Other reserves

707

707

707

Retained earnings

16,231

18,530

16,528

Total equity attributable to equity shareholders

15,781

18,073

16,073

Non-controlling interest

-

372

116

Total equity

15,781

18,445

16,189

Bisichi PLC

Consolidated Cash Flow Statement

For the six months ended 30 June 2021

Unaudited

Unaudited

Audited

30 June

30 June

31 December

2021

2020

2020

£000

£000

£000

Cash flows from operating activities

Operating profit

(223)

(1,743)

(4,493)

Depreciation

1,338

1,379

2,193

Unrealised (gain)/loss on investments

(376)

261

(67)

Unrealised loss on investment properties

-

-

1,295

Exchange adjustments

9

206

(39)

Movement in working capital

2,075

(633)

2,374

Net interest paid

(383)

(289)

(616)

Income tax (paid)/received

(211)

(72)

(198)

Cash flow from operating activities

2,229

(891)

449

Cash flows from investing activities

(1,395)

(2,079)

(4,292)

Cash flows from financing activities

(142)

(125)

(285)

Net increase/(decrease) in cash and cash equivalents

692

(3,095)

(4,128)

Cash and cash equivalents at 1 January

(1,078)

2,878

2,878

Exchange adjustment

(40)

481

172

Cash and cash equivalents at end of period

(426)

264

(1,078)

Cash and cash equivalents

For the purposes of the cash flow statement, cash and cash equivalents comprise the following balance sheet amounts:


Cash and cash equivalents

3,543

4,977

3,768

Bank overdrafts

(3,969)

(4,713)

(4,846)

Cash and cash equivalents at end of period

(426)

264

(1,078)

Bisichi PLC

Consolidated statement of changes in shareholders' equity

For the six months ended 30 June 2021

Share

Share

Translation

Available for sale

Other

Retained

Non-
controlling

Total

capital

premium

reserve

reserves

reserves

earnings

Total

Interest

Equity

£’000

£’000

£’000

£’000

£’000

£’000

£’000

£’000

£’000

Balance at 31 December 2019

1,068

258

(2,090)

-

707

19,989

19,932

625

20,557

Profit for the period

-

-

-

-

-

(1,352)

(1,352)

(186)

(1,538)

Other comprehensive income and expense

-

-

(400)

-

-

-

(400)

(67)

(467)

Total comprehensive income for the period

-

-

(400)

-

-

(1,352)

(1,752)

(253)

(2,005)

Dividend

-

-

-

-

-

(107)

(107)

-

(107)

Balance at 30 June 2020

1,068

258

(2,490)

-

707

18,530

18,073

372

18,445

Balance at 31 December 2019

1,068

258

(2,090)

-

707

19,989

19,932

625

20,557

Profit for the year

-

-

-

-

-

(3,354)

(3,354)

(440)

(3,794)

Other comprehensive income and expense

-

-

(398)

-

-

-

(398)

(69)

(467)

Total comprehensive income for the year

-

-

(398)

-

-

(3,354)

(3,752)

(509)

(4,261)

Dividend

-

-

-

-

-

(107)

(107)

-

(107)

Balance at 31 December 2020

1,068

258

(2,488)

-

707

16,528

16,073

116

16,189

Profit for the year

-

-

-

-

-

(297)

(297)

(117)

(414)

Other comprehensive income and expense

-

-

5

-

-

-

5

1

6

Total comprehensive income for the period

-

-

5

-

-

(297)

(292)

(116)

(408)

Dividend

-

-

-

-

-

-

-

-

-

Balance at 30 June 2021

1,068

258

(2,483)

-

707

16,231

15,781

-

15,781

ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS:

The results for the six months ended 30 June 2021 have been prepared in accordance with International Financial Reporting Standards (IFRS). The principal accounting policies applied are the same as those set out in the Financial Statements for the year ended 31 December 2020, and which will form the basis of the 2021 Annual report.

1. Segmental analysis

For management purposes, the Group is organised into two operating Divisions, Mining and Property. These Divisions are the primary basis on which the Group reports its segment information. This is consistent with the way the Group is managed and with the format of the Group's internal financial reporting.

Unaudited

Unaudited

Audited

30 June

30 June

31 December

2021

2020

2020

£000

£000

£000

Revenue

Mining

23,016

13,716

28,567

Property

594

503

1,181

Other

29

31

57

23,639

14,250

29,805

Operating profit/(loss)

Mining

(900)

(1,920)

(3,975)

Property

275

409

(637)

Other

402

(231)

119

(223)

(1,742)

(4,493)

Share of profit in joint ventures

(80)

13

(87)

Interest receivable

9

19

25

Interest payable

(392)

(309)

(641)

Profit/(Loss) before taxation

(686)

(2,019)

(5,196)

2. Taxation

Unaudited

Unaudited

Audited

30 June

30 June

31 December

2021

2020

2020

£000

£000

£000

Based on the results for the period:

Corporation tax at 27.00% (2020: 27%)

5

6

12

Prior year adjustment - UK

-

-

2

5

6

14

Deferred taxation

(276)

(487)

(1,416)

(271)

(481)

(1,402)

3. Earnings/ (loss) per share

Both the basic and diluted earnings per share calculations are based on a loss of £297,000 (2020: loss of £1,352,000). The basic earnings per share has been calculated on a weighted average of 10,676,839 (2020: 10,676,839) ordinary shares being in issue during the year. The diluted earnings per share has been calculated on the weighted average number of shares in issue of 10,676,839 (2020: 10,676,839) plus the dilutive potential ordinary shares arising from share options of nil (2020: nil) totalling 10,676,839 (2020: 10,676,839).

4. Investment properties

Investment properties are held a fair value at each reporting period. Management evaluate on an ongoing basis the impact of Covid-19 and the current economic performance of the UK Retail market on the future performance of the group’s existing UK property portfolio. The Board considers the final impact of Covid-19 on the investment properties to remain uncertain. However the Directors have placed a valuation on the properties which is not materially different to the value as at 31 December 2020. Therefore no change in fair value of investment properties has been made during the period. Investment properties are therefore included at a Director’s valuation which is considered to be the fair value as at 30 June 2021. Please refer to page 71 to 73 of the 2020 Annual report and Accounts for details on the valuation of investment and development properties as at 31 December 2020.

5. Related Parties

The related parties and the nature of costs recharged are as disclosed in the Group's annual financial statements for the year ended 31 December 2020. The Group paid management fees of £100,000 (30 June 2020: £100,000 December 2020: £200,000) to London & Associated Properties PLC, an associated company.

6. Financial information

The above financial information does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. The figures for the year ended 31st December 2020 are based upon the latest statutory accounts, which have been delivered to the Registrar of Companies; the report of the auditors on those accounts was unqualified and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006.

As required by the Disclosure and Transparency Rules of the UK's Financial Conduct Authority, the interim financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) and in accordance with both IAS 34 'Interim Financial Reporting' as adopted by the European Union and the disclosure requirements of the Listing Rules.

The half year results have not been audited or subject to review by the company's auditors.

The annual financial statements of Bisichi PLC are prepared in accordance with IFRS as adopted by European Union. The same accounting policies are used for the six months ended 30 June 2021 as were used for the year ended 31 December 2020.

The assessment of new standards, amendments and interpretations issued but not effective, are not anticipated to have a material impact on the financial statements.

The largest areas of estimation and uncertainty in the interim financial statements are in respect of:

- The valuation of investment and development properties;

- Life of mine and reserves;

- Depreciation;

- Provision for rehabilitation (relating to environmental rehabilitation of mining areas); and

- Impairment

Property, plant and equipment representing the group’s mining assets in South Africa are reviewed for impairment where there is evidence of a material impairment. The impairment test indicated significant headroom as at 31 December 2020 and no impairment was considered appropriate. Although the final impact of Covid-19 remains uncertain, the directors have assessed the expected range of impact of the Covid-19 pandemic on its impairment model using similar key assumptions and estimates as outlined on page 60 of the 2020 Annual report and Accounts, and no impairment was considered appropriate as at 30 June 2021.

Other areas of estimation and uncertainly are referred to in the Group's annual financial statements. There have been no significant changes to the basis of accounting of key estimates and judgements as disclosed in the annual report as at 31 December 2020.

The interim financial statements have been prepared on the going concern basis. Although the final impact of Covid-19 on both our UK and South African operations remains uncertain and an estimate of the overall financial effect cannot be made, the Directors have assessed the range of expected impact of the pandemic on its cashflow forecasts. The forecasts demonstrate that the group has adequate resources to continue in operational existence for the foreseeable future and is well placed to manage its business risks.

7. Dividend

No final dividend in respect of 2020 was proposed by the Board. No interim dividend for the year ended 31 December 2021 has been proposed by the Board.

8. Principal risks and uncertainties

The Group has an established risk management process which works within the corporate governance framework as set out in the 2020 Annual Report and Accounts. Risks and uncertainties identified by the Group are set out on page 11 of the 2020 Annual Report & Accounts and are reviewed on an ongoing basis. There have been no significant changes in the first half of 2021 to the principle risks and uncertainties as set out in the 2020 Annual Report & Accounts.

Covid-19 risk:

The Group is proactively assessing and managing the potential risks brought about by the uncertainty of the Covid-19 pandemic. Overall the Group is exposed to impacts on the health and safety of its employees and stakeholders and risks related to business continuity. In the UK, the Group expects there to be an impact on retail property revenue and potentially values. In South Africa, the Group is expected to be impacted by additional health and safety measures related to its workforce and coal price risk.

Risks faced by the business are assessed by the Board on an ongoing basis. Strategies for mitigating the risks have been defined and specific measures for achieving these are already underway. These include the measures outlined in the Chairman’s Statement, Mining Review and Financial Review & Performance sections of the 2020 Annual report and Accounts. The final impact of the Covid-19 pandemic remains uncertain and the Group will adapt plans accordingly as more information becomes available or government advice changes.

The other principal risks as stated in the 2020 Annual Report & Accounts reflect the challenging environment in which the business operates and are considered under the following broad headings:

Mining:

- Coal price risk

- Mining risk

- Currency risk

- New reserves and mining permissions

- Power supply risk

- Flooding risk

- Environmental risk

- Health & safety risk

- Labour risk

- Cashflow

Property:

- Property valuation

- Economic performance of United Kingdom

- Covid-19

- Brexit

9. Board approval

These interim results were approved by the Board of Bisichi PLC on 31 August 2021.

DIRECTORS RESPONSIBILITY STATEMENT AND REPORT ON PRINCIPAL RISKS

AND UNCERTAINITIES

Responsibility Statement

We confirm to the best of our knowledge:

(a) the condensed set of financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU;

(b) the interim management report includes a fair review of the information required by:

(1) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(2) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during the period; and any changes in the related party transactions described in the last annual report that could do so.

This report contains forward-looking statements. These statements are based on current estimates and projections of management and currently available information. Future statements are not guarantees of the future developments and results outlined therein. Rather, future developments and results are dependent on a number of factors; they involve various risks and uncertainties and are based upon assumptions that may not prove to be accurate. Risks and uncertainties identified by the Group are set out on page 11 of the 2020 Annual Report & Accounts. We do not assume any obligation to update the forward-looking statements contained in this report.

Michael Heller Andrew Heller

Chairman Managing Director

31 August 2021

DIRECTORS AND ADVISERS

Directors Sir Michael A Heller MA, FCA (Chairman)

Andrew R Heller MA, ACA (Managing Director)

Robert Grobler PR Cert Eng (Mining Director)

Garrett Casey CA (SA) (Finance Director)

Christopher A Joll MA (Non-executive)

John A Sibbald BL (Non-executive)

John Wong ACA, CFA (Non-executive)

Secretary & Registered office Garrett Casey CA (SA)

24 Bruton Place

London W1J 6NE

Black Wattle Colliery - Directors Andrew Heller (Managing Director)

Garrett Casey (Finance Director)

Ethan Dube (Commercial Director)

Robert Grobler (Mining Director)

Millicent Zvarayi

Registrars and transfer office Link Group

Shareholder Services

10th Floor

Central Square

29 Wellington Street

Leeds

LS14DL

UK Telephone: 0371 664 0300

International Telephone: +44 (0) 371 664 0300

(Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. We are open between 09:00 - 17:30, Monday to Friday excluding public holidays in England and Wales)

Website: www.linkgroup.com

E-mail: shareholderenquiries@linkgroup.co.uk

Company registration number 112155 (Incorporated in England and Wales)

Web site www.bisichi.co.uk

E-mail admin@bisichi.co.uk

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