UK Markets closed

IamFire Plc - AUDITED RESULTS TO 30 APRIL 2019

29 November 2019

IamFire plc
(formerly Karoo Energy plc)
(the “Company” or “IamFire”)

AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 APRIL 2019

Chief Executive Officer's statement and Group Strategic Report

for the year ended 30 April 2019

PRINCIPAL ACTIVITY

The principal activity of the Company during the year was that of investment in coal bed methane and shale gas exploration. Following the disposal of the subsidiaries post year end the principal activity of the Company going forward is that of an investment vehicle.

REVIEW OF BUSINESS

I was appointed to the Board of Directors upon leading a restructure and recapitalisation that was subject to General Meeting approval on the 11th October 2019 where all resolutions were duly passed. Through engaging in discussions with the Board of Directors over a period of time, it was clear that it was important the Company retain its listed status and work effectively with new Directors & shareholders (both existing and new) to not only recover and create value but to treat this restructure as an opportunity to create a company with a reinvigorated purpose. I saw this as an opportunity to get involved with the Company, providing exposure to an international network that extends access to global capital, assets and skilled operators.

Karoo (now named, IamFire plc) were unfortunate in not being able to proceed with a listing on AIM earlier this year and in the process, assumed substantive costs associated with the admission process. Given the substantial trade creditors associated with the Company, it was encouraging and refreshing to see the responsibility Noel Lyons demonstrated in personally satisfying and restructuring the trade creditors through entering a voluntary, informal insolvency process [the bulk of the creditors being parties that undertook services for Karoo with respect the attempted admission to AIM], representing the commitment to turning the situation around. It is also commendable that the participating creditors agreed to the terms of satisfaction with Noel Lyons.

In Botswana, the exploration licenses were not extended due to the inability to capitalise the expenditure requirements that would ensure retention. To this end the Company incurred losses in writing off the capital expended on the exploration licenses.

With Karoo (now named, IamFire plc) restructured, recapitalised with a modest capital finance £143,000 and its balance sheet restored the Board and I will be focused on creating a lean, low-cost investment vehicle seeking to transact, efficiently. The Board and I have already instilled disciplined, internal capital-management procedures that ensure we focus on capitalising our core costs of operation, assuming no Director’s salaries and for compensation to be awarded in parallel with performance and to be equity-driven.

Importantly as a company we will work to transact in association with capital markets. Assets of interest to the Company must be stress-tested in assuring that our shareholders will be confident that any acquisition that is made by the Company can be both capitalised and developed, meaningfully.

The Board and I will be working with our international network to review a number of different opportunities, with our review protocol governed principally by; distressed assets with underlying value that can be capitalised and enhanced through the Boards respective skillsets. 

As I conclude my first review of the business as a Director of the Company, I would like to extend my sincerest thanks to the existing shareholders for their support in this restructure, the incumbent board for their assistance and I look forward to updating our shareholders and the market as developments occur and working to augment value for all associated.

FINANCIALS

The financial results for the year-ended 30 April 2019 show a loss after taxation of £204,834 (2018: loss of £877,835) and year end cash of £2,130 (2018: £41,419). There have been no funds raised in the current year, with the Group raising £502,449 net of expenses during the prior year.

OUTLOOK                             

The focus for the Board and I for the coming year will be to operate a low-cost investment vehicle that will focus on identifying a transaction that will attract both broad market interest and present an enhanced platform for which we can access the required capital to invest and develop an interest.

It is a natural function and reality of growth market issuers to rely on capital markets and to this end, the Board and I will be specific in the purpose and channels for which we look to capitalise the Company moving forward, ensuring that capital investment via an equity finance is aligned with the remit and rationale of the business as we progress.

The Board and I are considering a number of different corporate avenues for the business to explore and further pursue and will ensure that effective communication is in place throughout the process when of material significance to our shareholders and the wider market.

ON BEHALF OF THE BOARD:

B S Tennent-Bhohi - Director

The Directors of the Company accept responsibility for the content of this announcement.

ENQUIRIES:

Company
 

IamFire plc
Burns Singh Tennent-Bhohi (Director)
Telephone:020 3778 0755

Corporate Adviser
Peterhouse Capital Limited
Guy Miller / Mark Anwyl
Telephone: 020 7220 9795

Consolidated Statement of Profit and Loss and Other Comprehensive

Income for the year ended 30 April 2019

                                                                                                       2019                                    2018

                                                          Notes                                     £                                           £

CONTINUING OPERATIONS

Other operating income                         4                                       30,311                                           -

Administrative expenses                        5                                   (228,155)                             (870,941)

OPERATING LOSS                                                                     (197,844)                             (870,941)

Finance costs                                          7                                      (7,000)                                 (7,000)

Finance income                                       7                                             10                                      106

LOSS BEFORE INCOME TAX 8 (204,834) (877,835)

Income tax                                             9                                               -                                           -

LOSS FOR THE YEAR (204,834) (877,835)

Loss attributable to:

Owners of the parent                                                                   (197,844)                             (831,175)

Non-controlling interests                                                                 (7,200)                               (46,660)

                                                                                                   (204,834)                             (877,835)

Earnings per share attributable to the

owners of the parent expressed

in pence per share:                                   10

Basic                                                                                               (0.10)                                   (0.41)

Diluted                                                                                            (0.10)                                   (0.41)

Consolidated Statement of Profit and Loss and Other Comprehensive Income

for the year ended 30 April 2019

                                                                                                       2019                                    2018

                                                                                                         £                                          £

LOSS FOR THE YEAR                                                                (204,834)                             (877,835)

OTHER COMPREHENSIVE INCOME                                                      -                                           -

TOTAL COMPREHENSIVE INCOME FOR THE YEAR
(204,834)

(877,835)

Total comprehensive income attributable to:

Owners of the parent                                                                   (197,844)                             (831,175)

Non-controlling interests                                                                 (7,200)                               (46,660)

                                                                                                   (204,834)                             (877,835)

Consolidated Statement of Financial Position

30 April 2019

                                                                                                       2019                                    2018

                                                          Notes                                     £                                           £

ASSETS

NON-CURRENT ASSETS

Intangible assets                                   11                                               -                               135,439

                                                                                                               -                               135,439

CURRENT ASSETS

Trade and other receivables                   13                                      35,220                                 41,072

Cash and cash equivalents                     14                                        2,130                                 41,419

                                                                                                      37,350                                 82,491

TOTAL ASSETS                                                                             37,350                               217,930

EQUITY

SHAREHOLDERS' EQUITY

Called up share capital                          16                                    511,837                               511,837

Share premium                                     17                                 2,231,786                            2,231,786

Retained earnings                                 17                               (3,040,821)                          (2,843,187)

                                                                                                   (297,198)                               (99,564)

Non-controlling interests                       15                                    (61,766)                               (54,566)

TOTAL EQUITY                                                                          (358,964)                             (154,130)

LIABILITIES

CURRENT LIABILITIES

Trade and other payables                      18                                    396,314                               372,060

TOTAL LIABILITIES                                                                     37,350                               372,060

TOTAL EQUITY AND LIABILITIES                                               37,350                               217,930

The financial statements were approved by the Board of Directors on 28 November 2019 and were signed on its behalf by:

B S Tennent-Bhohi – Director

Company Statement of Financial Position

30 April 2019

                                                                                                      2019                                    2018

                                                          Notes                                     £                                           £

ASSETS

NON-CURRENT ASSETS

Intangible assets                                   11                                               -                                           -

Investments                                          12                                               -                               312,674

                                                                                                               -                               312,674

CURRENT ASSETS

Trade and other receivables                   13                                      36,240                               189,841

Cash and cash equivalents                     14                                        1,234                                 41,419

                                                                                                      37,474                               231,260

TOTAL ASSETS                                                                             37,474                               543,934

EQUITY

SHAREHOLDERS' EQUITY

Called up share capital                          16                                    511,837                               511,837

Share premium                                     17                                 2,231,786                            2,231,786

Retained earnings                                 17                               (3,087,450)                          (2,529,646)

TOTAL EQUITY                                                                          (343,827)                              213,977

LIABILITIES

CURRENT LIABILITIES

Trade and other payables                      18                                    381,301                               329,957

TOTAL LIABILITIES                                                                   381,301                               329,957

TOTAL EQUITY AND LIABILITIES                                               37,474                               543,934

As permitted by Section 408 of the Companies Act 2006, the income statement of the parent company is not presented as part of these financial statements. The parent company's loss for the financial year was £557,804 (2018: loss of £1,276,364).

The financial statements were approved by the Board of Directors on 28 November 2019 and were signed on its behalf by:

B S Tennent-Bhohi - Director

Consolidated Statement of Changes in Equity

for the year ended 30 April 2019

                                                                                                    Called up

                                                                                                       share            Share         Retained

                                                                                                      capital         premium      earnings

                                                                                                        £                    £                    £

Balance at 1 May 2017                                                              469,590       1,771,584     (2,078,646)

Changes in equity

Loss for the year - - (831,175)

Total comprehensive loss for the year                                                      -                     -        (831,175)

Issue of share capital                                                                      42,247          494,375                     -

Cost of share issue                                                                                   -          (34,173)                    -

Share based payments                                                                             -                     -           66,634

Balance at 30 April 2018                                                           511,834     2,2231,786     (2,843,187)

Changes in equity

Loss for the year - - (197,634)

Total comprehensive loss for the year                                                      -                    -        (197,634)

Issue of share capital                                                                               -                     -                     -

Cost of share issue                                                                                   -                     -                     -

Share based payments                                                                             -                     -                     -

Balance at 30 April 2019                                                           511,837       2,231,786     (3,040,821)

                                                                                                                 Non-controlling                                                                                                                             Total

                                                                                                   Sub-Total      interests         equity

                                                                                                        £                    £                    £

Balance at 1 May 2017                                                              162,528            (7,906)        154,622

Changes in equity

Loss for the year     (831,175) (46,660) (877,835)

Total comprehensive loss for the year                                        (831,175)         (46,660)       (877,835)

Issue of share capital                                                                    536,622                     -         536,622

Cost of share issue                                                                        (34,173)                    -          (34,173)

Share based payments                                                                    66,634                     -           66,634

Balance at 30 April 2018                                                           (99,564)         (54,566)       (154,130)

Changes in equity

Loss for the year (197,634) (7,200) (204,834)

Total comprehensive loss for the year                                          (197,634)          (7,200)       (204,834)

Issue of share capital                                                                               -                     -                     -

Cost of share issue                                                                                   -                     -                     -

Share based payments                                                                             -                     -                     -

Balance at 30 April 2019                                                         (297,198)         (61,766)       (358,964)

Company Statement of Changes in Equity

for the year ended 30 April 2019

                                                                              Called up

                                                                                 share            Share          Retained          Total

                                                                                capital         premium       earnings         equity

                                                                                  £                    £                    £                    £

Balance at 1 May 2017                                        469,590       1,771,584     (1,319,916)        921,258

Changes in equity

Issue of share capital                                                42,247          494,375                     -         536,622

Cost of share issue                                                             -          (34,173)                    -          (34,173)

Share based payments                                                       -                     -            66,634           66,634

Total comprehensive income                                              -                     -     (1,276,364)    (1,276,364)

Balance at 30 April 2018                                     511,837       2,231,786     (2,529,646)        213,977

Changes in equity

Issue of share capital                                                         -                     -                     -                     -

Cost of share issue                                                             -                     -                     -

Share based payments                                                       -                     -                     -                     -

Total comprehensive income                                              -                     -        (557,804)       (557,804)

Balance at 30 April 2019                                     511,837       2,231,786     (3,087,450)       (343,827)

Consolidated Statement of Cash Flows

for the year ended 30 April 2019

                                                                                                      2019                                    2018

                                                                                                        £                                          £

Cash flows from operating activities

Cash used in operations                          1                                    (32,299)                             (389,613)

Interest paid                                                                                   (7,000)                                 (7,000)

Net cash used in operating activities                                              (39,299)                             (396,613)

Cash flows from investing activities

Purchase of intangible fixed assets                                                           -                                (64,523)

Interest received                                                                                   10                                      106

Net cash used in investing activities                                                       10                                (64,417)

Cash flows from financing activities

Share issue                                                                                              -                               502,449

Costs of Share Issue                                                                                -                                           -

Net cash from financing activities                                                             -                               502,449

   

Increase/(decrease) in cash and cash equivalents (39,289) 41,419
Cash and cash equivalents at beginning of year
2

41,419

-

   

Cash and cash equivalents at end of year
2

2,130

41,419

There is no net debt in either year.

Notes to the Consolidated Statement of Cash Flows

for the year ended 30 April 2019

1. RECONCILIATION OF LOSS BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Loss before income tax                                                                           (204,834)       (877,835)

          Impairment of intangible assets                                                                101,548         251,238

          Disposal of intangible assets                                                                       33,891                     -

          Share based payments                                                                                         -           66,634

          Finance costs                                                                                               7,000             7,000

          Finance income                                                                                                (10)              (106)

                                                                                                                          (62,405)       (553,069)

          Decrease/in trade and other receivables                                                       5,852           54,188

          Increase/in trade and other payables                                                          24,254         109,268

Cash used in operations (32,299) (389,613)

2.       CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

          Year ended 30 April 2019

                                                                                                                         30/4/19       30/04/18

                                                                                                                               £                    £

          Cash and cash equivalents                                                                           2,130           41,419

Company Statement of Cash Flows

for the year ended 30 April 2019

                                                                                                      2019                                    2018

                                                                                                        £                                          £

Cash flows from operating activities

Cash used in operations                          A                                    (33,195)                             (454,136)

Interest paid                                                                                   (7,000)                                 (7,000)

Net cash used in operating activities                                              (40,195)                             (461,136)

Cash flows from investing activities

Interest received                                                                                   10                                      106

Net cash from in investing activities                                                       10                                      106

Cash flows from financing activities

Share issue                                                                                              -                               502,449

Costs of Share Issue                                                                                -                                           -

Net cash from financing activities                                                             -                               502,449

   

Increase/(decrease) in cash and cash equivalents (40,185) 41,419
Cash and cash equivalents at beginning of year
B

41,419

-

   

Cash and cash equivalents at end of year
B

1,234

41,419

There is no net debt in either year.

Notes to the Company Statement of Cash Flows

for the year ended 30 April 2019

A. RECONCILIATION OF LOSS BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Loss before income tax                                                                           (557,804)    (1,276,364)

          Impairment of investments assets                                                            312,674                     -

          Write off inter-company loan                                                                    155,996                     -

          Share based payments                                                                                         -           66,634

          Finance costs                                                                                               7,000             7,000

          Finance income                                                                                                (10)              (106)

                                                                                                                          (82,144)    (1,202,836)

          Decrease/in trade and other receivables                                                      (2,395)        588,529

          Increase/in trade and other payables                                                          51,344         160,171

Cash used in operations (33,195) (454,136)

B.       CASH AND CASH EQUIVALENTS

The amounts disclosed on the Statement of Cash Flows in respect of cash and cash equivalents are in respect of these Statement of Financial Position amounts:

          Year ended 30 April 2019

                                                                                                                         30/4/19       30/04/18

                                                                                                                               £                    £

          Cash and cash equivalents                                                                           1,234           41,419

Notes to the Financial Statements

for the year ended 30 April 2019

1.       STATUTORY INFORMATION

IamFire plc is a public limited company, registered in England and Wales. The company's registered number and registered office address can be found on the Company Information page. The principal activity is disclosed in the Strategic Report.

2.       ACCOUNTING POLICIES

          Basis of preparation

The company financial statements of IamFire plc and its subsidiaries (together, "the Group") have been prepared in accordance with International Financial Reporting Standards ("IFRS"), as adopted by the European Union, IFRIC interpretations, and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.

IFRS is subject to amendment and interpretation by the IASB and the IFRS Interpretations Committee, and there is an on-going process of review and endorsement by the European Commission. These accounting policies comply with each IFRS that is mandatory for accounting periods ending on 30 April 2019.

The financial statements are presented in GBP (£) and rounded to the nearest £. GBP is also the functional currency of the Group. The financial statements ae prepared under the historical cost convention.

The principal accounting policies set out below have been consistently applied to all periods presented.

New and amended standards mandatory for the first time for the financial periods beginning on or after 1 January 2018:

As of 1 January 2018, the Group has adopted IFRS 9 and IFRS 15.

The Group adopted IFRS 9, Financial Instruments (‘IFRS 9’), which replaced IAS 39, Financial Instruments: Recognition and Measurement. IFRS 9 addresses the classification, measurement and recognition of financial assets and liabilities.

The Group reviewed the financial assets and liabilities reported on its Statement of Financial Position and completed an assessment between IAS 39 and IFRS 9 to identify any accounting changes. The financial assets subject to this review were trade and other receivables. The financial liabilities subject to this review were the trade and other payables. Based on this assessment of the classification and measurement model, there were no changes to classification and measurement other than changes in terminology.

IFRS 15 requires an expected quantitative impact of the application of IFRS 15 to be included within the financial statements. Recharged rental income recognition is not considered to change as a result of the transition to IFRS 15. The Group has no other revenue sources.

Of the other IFRSs and IFRICs adopted, none have had a material effect on future Groups Financial Statements.

International Financial Reporting Standards in issue but not yet effective and not yet adopted:

At the date of authorisation of these financial statements, the IASB and IFRS Interpretations Committee have issued standards, interpretations and amendments.

Whilst these standards and interpretations are not effective for, and have not been applied in the preparation of, these financial statements, the following may have an impact going forward:

New/Revised International Financial Reporting Standards Effective Date: Annual periods beginning on or after:
EU adopted
IFRS 16 Leases 1 January 2019 Yes

IFRS 16 introduces a single lease accounting model. This standard requires lessees to account for all leases under a single on-balance sheet model. Under the new standard, a lessee is required to recognise all lease assets and liabilities on the balance sheet; recognize amortisation of leased assets and interest on lease liabilities over the lease term; and separately present the principal amount of cash paid and interest in the cash flow statement. Due to the renegotiation of the leases management do not consider that adoption of this standard will have a material impact on the financial statements.

          Basis of consolidation

The consolidated financial statements incorporate the results of IamFire plc ("the Company") and entities controlled by the Company (its subsidiaries). Control is achieved where the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity.

Income and expenses of subsidiaries acquired or disposed of during the year are included in the Consolidated Statement of Comprehensive Income from the effective date of acquisition and up to the effective date of disposal, as appropriate. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Group.

The Group applies the acquisition method of accounting to account for business combinations. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred, and the equity interests issued by the Group. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

Acquisition-related costs of business combinations that have occurred after the date of transition are expensed as incurred.

All intra-Group transactions, balances, income and expenses are eliminated in full on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

          Going concern

The financial statements have been prepared on a going concern basis, which assumes that the Group and Company will continue in operational existence for the foreseeable future.

During the year ended 30 April 2019 the Group made a loss of £239,884 (2018: a loss of £877,835) and as at 30 April 2019 it had net current liabilities of £394,014 (2018: net current liabilities of £289,569).

The Group and Company have no revenue but has cash resources to finance activities whilst it identifies and completes suitable transaction opportunities. When a suitable transaction is identified, the Directors will consider the need for further funding to complete the transaction.

Following a restructuring in October 2019 and the sale of both subsidiaries, the company is now unencumbered by significant trade creditors and has raised £143,000.

The Directors consider that the continued adoption of the going concern basis is appropriate having reviewed the cash flow forecasts for the coming 18 months and the Financial Statements do not reflect any adjustments that would be required if they were to be prepared on any other basis.

          Intangible assets

The Group accounts for oil and gas expenditure under the full cost method of accounting.

Costs (other than payments to acquire the legal right to explore) incurred prior to acquiring the rights to explore are charged directly to the income statement. All costs incurred after the rights to explore an area have been obtained, such as geological, geophysical, data costs and other direct costs of exploration and appraisal are accumulated and capitalised as intangible exploration and evaluation ("E&E") assets.

E&E costs are not amortised prior to the conclusion of appraisal activities. At the completion of appraisal activities if technical feasibility is demonstrated and commercial reserves are discovered, then following development sanction, the carrying value of the relevant E&E asset will be reclassified as a development and production asset within tangible fixed assets.

If after completion of appraisal activities in an area, it is not possible to determine technical feasibility or commercial viability, then the costs of such unsuccessful exploration and evaluation are written off to the income statement. The costs associated with any wells which are abandoned are fully amortised when the abandonment decision is taken.

Development and production assets, are accumulated generally on a field by-field basis and represent the costs of developing the commercial reserves discovered and bringing them into production, together with the E&E expenditures incurred in finding commercial reserves which have been transferred from intangible E&E assets.

          Financial instruments

Financial assets and financial liabilities are recognised when the Group and Company becomes a party to the contractual provisions of the financial instrument. Please refer to note 20 in the Financial Statements for further disclosure.

Financial assets and financial liabilities are measured initially at fair value plus transactions costs. Financial assets and financial liabilities are measured subsequently as described below.

Financial assets

The Group and Company classify their financial assets into one of the following categories, depending on the purpose for which the asset was acquired. The classification depends on the purpose for which the financial assets were acquired. Financial assets are either held at amortised cost, fair value through profit or loss; or fair value through other comprehensive income. Management determines the classification of its financial assets at initial recognition.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They incorporate various types of contractual monetary assets, such as advances made to affiliated entities which give rise to other receivables and cash and cash equivalents includes cash in hand and deposits held at call with banks. Other receivables are carried at amortised cost less any provision for impairment, as the contracted cashflows solely relate to the payment of principal and interest. Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties on the part of the counterparty) that the Group and Company will be unable to collect all of the amounts due under the terms of the receivable, the amount of such a provision being the difference between the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable.     

A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulty, high probability of bankruptcy or a financial reorganisation and default are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between the asset's carrying amount and the present value of the estimated future cash flows discounted at original effective interest rate. The loss is recognised in the Income Statement. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited in the Income Statement.

Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and all substantial risks and rewards are transferred.

Financial liabilities

The Group’s financial liabilities include trade and other payables.

Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

A financial liability is derecognised when it is extinguished, discharged, cancelled or expires.

          Taxation

Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules, using tax rates enacted or substantially enacted by the statement of financial position date.

Deferred taxation is calculated using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, if the deferred tax arises from the initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss, it is not accounted for. Deferred tax is determined using tax rates and laws that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax liabilities are provided in full.

Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the Income Statement, except where they relate to items that are charged or credited directly to equity in which case the related deferred tax is also charged or credited directly to equity.

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

          Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the statement of financial position date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.

Assets and liabilities of subsidiaries that have a functional currency different from the presentation currency (pound sterling), if any, are translated at the closing rate at the date of each balance sheet presented. Income and expenses are translated at average exchange rates. All resulting exchange differences are recognised in other comprehensive income (loss), if any.

          Operating lease commitments

Rentals paid under operating leases are charged to the income statement on a straight line basis over the period of the lease.

2.       ACCOUNTING POLICIES - continued

          Finance income and costs

Interest is recognised using the effective interest method which calculates the amortised cost of a financial asset or liability and allocates the interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts or payments through the expected life of the financial asset or liability to the net carrying amount of the financial asset or liability.

          Share based payments

Where share options have been granted to directors, IFRS 2 has been applied whereby the fair value of the options is measured at the grant date and spread over the period during which the employees become entitled to the options. An options valuation model is used to assess the fair value, taking into account the terms and conditions attached to the options. The fair value at grant date is determined including the effect of market based vesting conditions, to the extent such vesting conditions have a material impact.

The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (the vesting date).

The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity instruments that will ultimately vest.

The charge or credit for a period to the Income Statement represents the movement in cumulative expense recognised as at the beginning and end of that period.

No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting irrespective of whether or not the market condition is satisfied, provided that all other performance and/or service conditions are satisfied. Where the terms of an equity-settled award are modified, the minimum expense recognised is the expense as if the terms had not been modified. An additional expense is recognised for any modification, which increases the total fair value of the share-based payment arrangement, or is otherwise beneficial to the employee as measured at the date of modification.

Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new awards are treated as if they were a modification of the original award, as described in the previous paragraph.

Where an equity-settled award is forfeited, the cumulative charge expensed up to the date of forfeiture is credited to the Income Statement.

3.       CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY

The preparation of consolidated financial statements in conformity with International Financial Reporting Standards as adopted by the EU requires management to make estimates and judgements that affect the reported amounts of assets and liabilities as well as the disclosure of contingent assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the reporting period.

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The following are the significant judgements used in applying the accounting policies of the Group that have the most significant effect on the consolidated financial statements:

Impairment of capitalised exploration and evaluation expenditure:

The future recoverability of capitalised exploration and evaluation expenditure is dependent on a number of factors, including whether it successfully recovers the related exploration and evaluation asset through sale. Factors which could impact the future recoverability include the level of proved, probable and inferred resources, future technological changes which could impact the cost of drilling and extraction, future legal changes (including changes to environmental restoration obligations), changes to commodity prices and licence renewal dates and commitments.

To the extent that capitalised exploration and evaluation expenditure is determined to be irrecoverable in the future, this will reduce profits and net assets in the period in which this determination is made. In addition, exploration and evaluation expenditure is capitalised if activities in the area of interest have not yet reached a stage which permits reasonable assessment of the existence or otherwise of economically recoverable reserves. To the extent that it is determined in the future that this capitalised expenditure should be written off, this will reduce profits and net assets in the period in which this determination is made. Refer to note 11 in respect of intangible assets.

4.       OTHER OPERATING INCOME

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Recharged rental income                                                                            30,311                     -

Other operating income relates entirely to rent for the sub-let of the property held under operating lease.

5.       SEGMENTAL REPORTING

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker. The chief operating decision maker, who is responsible for allocating resources, assessing the performance of the operating segment and making strategic decision, has been identified as the Board of Directors. The Board of Directors consider that the Group has only one operating segment which was that of investment in coal bed methane and shale gas exploration. Going forward this will be as an investment vehicle.

6.       EMPLOYEES AND DIRECTORS

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Wages and salaries (short term employee benefits)                                      6,350           67,900

The average number of employees during the year was as follows:

                                                                                                                            2019              2018

          Directors (no employees)                                                                                  3                    3

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Directors' remuneration                                                                                6,350           67,900

During the year the directors were paid the following amounts: -

£
N Lyons 3,000
J Negaard 11,400
A Smith (paid through Nuthatch Advisors) 7,200

The difference between the charge in the financial statements and the amounts paid is represented by the reversal of a prior year accrual.

7.       NET FINANCE COSTS

                                                                                                                            2018              2017

                                                                                                                               £                    £

          Finance income:

          Bank interest received                                                                                       10                106

          Finance costs:

          Interest payable on loan from Director                                                          7,000             7,000

          Net finance costs                                                                                          6,990             6,894

8.       LOSS BEFORE INCOME TAX

          The loss before income tax is stated after charging:

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Operating leases                                                                                         26,400           27,601

          Fees paid to the company’s auditor:

          Audit fees                                                                                                     9,000             9,840

          Taxation compliance services                                                                               -             1,800

          Reporting accountant services                                                                             -           28,000

          Impairment of intangible assets                                                                101,548         251,238

        All 2018 audit and non-audit fees were paid to the Company’s previous auditor.

9.       INCOME TAX

          Analysis of tax expense

No liability to UK corporation tax arose for the year ended 30 April 2019 nor for the year ended 30 April 2018.

          Factors affecting the tax expense

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Loss before income tax                                                                           (204,834)       (877,835)

Loss multiplied by the standard rate of corporation tax in the UK of 19% (2018 - 19%)
(38,918)

(166,789)

          Effects of:

Deferred tax not provided   38,918 166,789

          Tax expense                                                                                                        -                     -

Tax losses have been carried forward from prior years totalling £1,329,627 with further losses incurred in the current year. Due to the change to an investment vehicle, the losses, although carried forward, are unlikely to be utilised in future periods. As a result, no deferred taxation has been provided for.

10.     EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period.

The Group does have potentially dilutive shares. However, as the Group made a loss in both the current and prior years, the basic and diluted earnings per share are the same.

Reconciliations are set out below.

                                                                                                                            2019

                                                                                                                         Weighted

                                                                                                                          average

                                                                                                                          number      Per-share

                                                                                                   Earnings             of               amount

                                                                                                          £               shares            pence

          Basic and diluted EPS

Earnings attributable to ordinary shareholders (197,844)  204,734,976 (0.10)

          Effect of dilutive securities                                                             -                     -                     -

                                                                                                                             2018

                                                                                                                         Weighted

                                                                                                                          average

                                                                                                                           number         Per-share

                                                                                                    Earnings              of                amount

                                                                                                          £                shares             pence

          Basic and diluted EPS

Earnings attributable to ordinary shareholders (831,175)  204,734,976 (0.41)

          Effect of dilutive securities                                                             -                     -                     -

11.     INTANGIBLE ASSETS

          Group

                                                                                                                                           Exploration

                                                                                                                                                     and evaluation                                                                                                                                 assets

                                                                                                                                                     £

          COST

          At 1 May 2018                                                                                                              135,439

          Impairments                                                                                                                 (135,439)

          At 30 April 2019                                                                                                                        -

          NET BOOK VALUE

          At 30 April 2019                                                                                                                        -

          At 30 April 2018                                                                                                             135,439

11.     INTANGIBLE ASSETS - continued

          Group

As at 30 April 2019 the Directors have reviewed the intangible exploration asset for indicators of impairment in accordance with IFRS 6 Exploration for and Evaluation of Mineral Resources and, as a result of indicative factors, have undertaken a full impairment review of the licenses and as a result all exploration assets were fully impaired.

12.     INVESTMENTS

          Company

                                                                                                                                               Shares in

                                                                                                                                                   group

                                                                                                                                        undertakings

                                                                                                                                                     £

          COST

          At 1 May 2018                                                                                                              312,674

          Impairment                                                                                                                  (312,674)

          NET BOOK VALUE

          At 30 April 2019                                                                                                                        -

          At 30 April 2018                                                                                                             312,674

The group or the company's investments at the Statement of Financial Position date in the share capital of companies include the following:

          Subsidiaries

Equatorial Oil and Gas PLC

Registered office: 2nd Floor, 1 Bentick Street, London, W1G 2EA

Nature of business: Oil and gas exploration

                                                                                                 %

          Class of shares:                                                          holding

          Ordinary                                                                      94.00

Tamboran Botswana (Pty) Ltd

Registered office: Botswana

Nature of business: Oil and gas exploration

                                                                                                 %

          Class of shares:                                                          holding

          Ordinary                                                                      94.00

100% of the interest in Tamboran Botswana (Pty) Ltd is held indirectly by Equatorial Oil and Gas PLC.

13.     TRADE AND OTHER RECEIVABLES

                                                                                           Group                               Company

                                                                                2019               2018              2019              2018

                                                                                  £                    £                    £                    £

Current:

          Trade receivables                                             4,795                     -             4,795                     -          Other receivables                                           10,250            10,250            10,250           10,250

          Director current account                                 15,375            16,595            16,595           16,595

          Inter-co - Equatorial                                                -                     -                     -         155,996

          VAT                                                                     200             7,227                     -                     -

          Prepayments and accrued income                     4,600             7,000             4,600             7,000

                                                                                35,220            41,072            36,240         189,841

As at 30 April 2019, the Group conducted an impairment review in accordance with the provisions of IFRS 9. As a result of the change in business focus following the aborted AIM listing all intercompany receivables were written off.

14.     CASH AND CASH EQUIVALENTS

                                                                                           Group                               Company

                                                                                2019               2018              2019              2018

                                                                                  £                    £                    £                    £

          Bank accounts                                                  2,130            41,419             1,234           41,419

At 30 April 2019 and 2018 all significant cash and cash equivalents were deposited with major clearing banks in the UK with at least an 'A' rating.

15.     NON-CONTROLLING INTERESTS

Non-Controlling interest for the year was £7,200 (2018: £46,660).

16.     CALLED UP SHARE CAPITAL

          Allotted, issued and fully paid:

          Number:        Class:                                                       Nominal               2019              2018

                                                                                                   value:                  £                     £

          204,734,976  Ordinary                                                 0.0025                  511,837         511,837

16.     CALLED UP SHARE CAPITAL - continued

204,734,976 Ordinary shares of 0.0025 each were allotted as fully paid at a premium of £0.0275 per share during the year.

Allotted, issued, and fully paid:

2019 2018
No £ No £
Ordinary shares of £0.0025 each
Opening balance at 1 May 204,734,976 511,837 187,836,308 469,590
Allotments:
22 May 2017 – shares issued at 3.0p each resulting premium of £426,240 - - 15,500,000 38,750
22 May 2017 – shares issued at 3.0p each resulting premium of £10,963 - - 398,668 997
22 May 2017 – shares issued at 3.0p each resulting premium of £27,500 - - 1,000,000 2,500
At 30 April 204,734,976 511,837 204,734,976 511,837

17.     RESERVES

          Group

                                                                                                    Retained          Share

                                                                                                    earnings       premium         Totals

                                                                                                        £                    £                    £

          At 1 May 2018                                                              (2,843,187)    2,231,786      (611,401)

          Loss for the year                                                             ( 197,634)                   -      (197,634)

          At 30 April 2019                                                           (3,040,821)    2,231,786      (809,035)

          Company

                                                                                                    Retained          Share

                                                                                                    earnings       premium         Totals

                                                                                                        £                    £                    £

          At 1 May 2018                                                              (2,529,646)    2,231,786      (297,860)

          Loss for the year                                                             (557,804)                          (557,804)

          At 30 April 2019                                                           (3,087,450)    2,231,786      (855,664)

17.     RESERVES - continued

Equity comprises the following:

-Share capital: represents amounts subscribed for shares at nominal value.

-Share premium: represents amounts subscribed for share capital, net of issue costs, in excess of nominal value.

-Retained earnings: represents the accumulated profits and losses attributable to equity shareholders.

18.     TRADE AND OTHER PAYABLES

                                                                                           Group                               Company

                                                                                2019               2018              2019              2018

                                                                                  £                    £                    £                    £

Current:

          Trade payables                                             262,054          216,561          252,041         211,349

          Other payables                                               13,200                     -            13,200                     -

          Loan from Related Party                                 94,260            87,260            94,260           87,260

          Accruals and deferred income                         26,800            68,239            21,800           31,348

                                                                              396,314          372,060          381,301         329,957

Prudent liquidity risk management includes maintaining sufficient cash balances to ensure the Group and Company can meet liabilities as they fall due.

In managing liquidity risk, the main objective of the Group is to ensure that it has the ability to pay all of its liabilities as they fall due. The Group monitors the level of working capital it requires. The undiscounted cash flows on the Group's financial liabilities as at 30 April 2019 and 2018 are presented in the table below.

Total On Demand Within
2 -6
months
6 – 12
months
£ £ £ £
At 30 April 2019
Trade payables 262,054 262,054 - -
Other payables 13,200 13,200 - -
Loan from Related Party 94,260 94,260 - -
Accruals and deferred income 26,800 21,800 - -

   

396,314 396,314 - -

   

Total On Demand Within
2 -6
months
6 – 12
months
£ £ £ £
At 30 April 2018
Trade payables 216,561 216,561 - -
Loan from Related Party 87,260 87,260 - -
Accruals and deferred income 68,239 69,239 - -
372,060 372,060 - -

19.     OPERATING LEASE COMMITMENTS

Minimum lease payments fall due as follows:

          Group

      Non-cancellable      operating leases

                                                                                                                            2019              2018

                                                                                                                               £                    £

          Within one year                                                                                          26,400           26,472

          Between one and five years                                                                        54,319           80,719

                                                                                                                            80,719         107,191

Payments recognised as an expense relating to minimum lease payments under operating leases during the year totalled £26,400 (2018: £27,601).

20.     FINANCIAL INSTRUMENTS

The Company’s financial instruments comprise primarily cash and various items such as trade debtors and trade payables which arise directly from operations. The main purpose of these financial instruments is to provide working capital for the Company’s operations. The Company does not utilise complex financial instruments or hedging mechanisms.

The tables below set out the Group’s accounting classification of each class of its financial assets and liabilities.

Financial assets Measured at amortised cost
2019 2018
£ £
Financial assets at amortised costs:
Amounts due from director (note 13) 15,375 16,595
Other receivables (note 13) 15,050 24,477
Cash and cash equivalents (note 14) 2,130 41,419
32,555 82,491

All of the above financial assets’ carrying values are approximate to their fair values, as at 30 April 2019 and 2018.

   Financial liabilities Measured at amortised cost
2019 2018
£ £
Trade payables (note 18) 262,054 216,561
Loan from related party (note 18) 94,260 87,260
Accruals (note 18) 26,800 68,239
Other payables 13,200 -
396,314 372,060

In the view of management, all of the above financial liabilities’ carrying values approximate to their fair values as at 30 April 2019 and 2018.

Credit risk

The maximum exposure to credit risk at the reporting date was in respect of other receivables totalling £15,050 (2018: £24,477).

21.     OTHER FINANCIAL COMMITMENTS

License commitments:

All licence commitments have been withdrawn with the sale of both subsidiaries after the year end. No further licence commitments remain.

22.     SHARE-BASED PAYMENT TRANSACTIONS

The Group occasionally issues share options and warrants to Directors and shareholders. They are settled in equity once exercised. Details of the number of share options/warrants and the weighted average exercise price (WAEP) outstanding during the year are as follows:

2019 Number of options/warrants WAER
£
Outstanding at the beginning of the year 26,750,000 0.0408
Number vested & exercisable at 30 April 26,750,000 0.0408
2018 Number of options/warrants WAER
£
Outstanding at the beginning of the year 11,250,000 0.0144
Issued 15,500,000 0.0600
Number vested & exercisable at 30 April 26,750,000 0.0408

The Group recognised total expenses of £nil (2018: £66,634) related to share options accounted for as equity-settled share-based payment transactions during the year. All options were cancelled post year end.

23.     RELATED PARTY TRANSACTIONS

During 2016 the Company received a loan from Noel Lyons of £70,000. Interest has been accrued at 10% per annum and is repayable on demand. The amount outstanding at 30 April 2019 totalled £94,260 (2018: £87,260). The balance is included within trade and other payables.

The only other transactions with directors were those in respect of services provided to the Company, as disclosed within note 6 of these financial statements.

Noel Lyons is a director of both the Company and Clean Invest Africa Plc. During the year the Company received £30,311 from Clean Invest Africa Plc in respect of rent. At the year end the amount due was £4,796 (2018: £nil).

24.     EVENTS AFTER THE REPORTING PERIOD

The Company has been successfully restructured following a General Meeting held in October 2019. The Company undertook and completed a private placement to raise £143,000, welcomed new board members, shareholders and restructured all liabilities associated with the Company.

25.     ULTIMATE CONTROLLING PARTY

The directors do not consider there to be an ultimate controlling party.

26.     FINANCIAL RISK MANAGEMENT

          FINANCIAL INSTRUMENTS

          The group's financial instruments comprise listed investments, bank balances, trade payable and

Other payables all arising in the normal course of business. The purpose of theses financial instruments is to finance the group's operations.

The group manages liquidity risk and cash flow risk by monitoring its cash balances and ensuring that funds are available to meet liabilities as they fall due. The group's core funding comes from the proceeds of share issues.

The group's exposure to change in interest rates relates primarily to cash at bank. Cash is held on either current or on short term deposits at floating rates of interest determined by the relevant bank's prevailing base rate. The group seeks to obtain a favourable interest rate on its cash balances through the use of bank treasury deposits.

The group holds investments quoted on public markets. In the opinion of the directors the main risk is due to market price fluctuations.

CREDIT RISK

The Group’s credit risk is primarily attributable to its cash balances an trade receivables. The group does not have a significant concentration of risk, with exposure spread over a number of third parties.

The credit risk on liquid funds is limited because the third parties are large international banks with a credit rating of at least A.

The Group's total credit risk amounts to the total of the sum of the receivables and cash and cash equivalent.

INTEREST RATE RISK

The Group's only exposure to interest rate risk is the interest received on the cash held on deposit, which is immaterial. The Groups only borrowing relates to a loan from Noel Lyons of £70,000 lent in the year to 30 April 2016. The amount outstanding at 30 April 2019 totalled £94,260 (2018: £87,260). The balance is included within trade and other payables.

CAPITAL MANAGEMENT

The Group’s capital management objectives are to ensure the Group’s ability to continue as a going concern and to provide long-term returns to shareholders

The Group defines and monitors capital on the basis of the carrying amount of equity, less cash and cash equivalents as presented on the face of the Balance Sheet and further disclosed in note 14.

The Board of Directors monitors the level of capital as compared to the Group’s commitments and adjusts the level of capital as is determined to be necessary by issuing new shares. The Group is not subject to any externally imposed capital requirements.

These policies have not changed in the year.

27.     SUBSEQUENT EVENTS

On 11th October [upon GM approval] the Company disposed of its subsidiaries to N.Lyons for a sum of £1.