26 August 2016

Interim Results for the period ended 30 June 2016

For the six months ending  30th June 2016:

  • EBITDA: £1.0million                  (2015: £1.232 million)
  • EPS (basic): 7p                            (2015: 2.56p)
  • Total production: 795,000 tonnes (2015: 838,000 tonnes)
  • Planned increase in production from Black Wattle reserves by year end
  • Continuing focus on control of costs and production at Black Wattle Colliery
  • Physical demand for Black Wattle coal remains strong despite low international coal prices
  • UK property portfolio performing well with voids across the portfolio at only 2.0% (2015: 2.3 %.)

END

For further information, please call:

Andrew Heller/Garrett Casey     Bisichi Mining PLC                                       020 7415 5030

Bisichi Mining PLC

Half year review – 30 June 2016

For the six month period ending on 30 June 2016, Bisichi Mining PLC achieved earnings before interest, tax, depreciation and amortisation of £1.0 million (2015: £1.2 million).  As part of the production plan for the first half of the year Black Wattle Colliery, our direct coal mining asset in South Africa, continued to supplement production from its own reserves with coal mined at Blue Nightingale under an agreement to purchase Run of Mine coal. This resulted in total production of 795,000 metric tonnes (2015: 838,000 metric tonnes) during the period reported. However, towards the end of this six month period the quality of the coal bought from Blue Nightingale deteriorated as the reserve came to an end; this has had a temporary impact on earnings. In anticipation of the Blue Nightingale reserve coming to an end, management plans were already in place to increase production from Black Wattle’s own reserves. The development of these new opencast areas at Black Wattle will take time to build up production but the mine is expected to reach full production by the end of the year.  The demand for our coal has remained strong but international coal prices have continued to remain low for most of the first half of 2016. Although we have recently seen an improvement in the US Dollar international coal price, a reversal in the depreciation of the South African Rand has partially offset this increase. Overall, the decrease in group revenue compared to the same period last year can mainly be attributed to the depreciation of the Rand against our reporting currency in UK Sterling. Looking forward, we will continue with our existing management strategy of keeping our cost of production low in order to reduce the impact of any further weakness in the international coal price. Meanwhile, Black Wattle continues to perform well under the Quattro Programme, which allows junior black-economic empowerment coal producers direct access to the coal export market via Richards Bay Coal Terminal. We would like to thank Vunani Limited, our black economic empowered shareholders at Black Wattle, for managing and developing this opportunity.  Looking forward to the rest of this year, management will continue to focus on improving levels of production from our existing reserves at Black Wattle and we remain confident in our ability to achieve significant value from our South African mining operations for many years to come.  Finally, the Company’s UK retail property portfolio, which is managed by London & Associated Properties PLC, continues to perform well with voids across the portfolio at the low level of 2.0% (2015: 2.3%).  Your directors intend to pay an interim dividend of 1p per share which will be paid on the 10 February 2017, to shareholders on the register at the close of business on 6 January 2017.

On behalf of the Board we would like to thank all our staff for their hard work during the first six months of the year.

Sir Michael Heller                                      Andrew Heller
Chairman                                                            Managing Director
26 August 2016

Bisichi Mining PLC

Consolidated income statement for the six months ended 30 June 2016

Unaudited Unaudited Audited
6 months ended                        6 months ended

Year
ended

30 June 30 June 31 December
2016 2015 2015
Notes £000 £000 £000
Group revenue 1          10,925            13,879            25,655
Operating costs          (10,675)          (13,450)          (25,719)
Operating profit/(loss) on trading activities          250          429            (64)
Increase in value of investment properties                  –              –                  225  
Increase/(Decrease) in value of other investments 11 (1) (11)
Gains on held for trading investments                    –                    4                    –
Operating profit 1          261          428            150
Loss on reclassification of asset held for sale (138)
Share of loss in joint ventures                (1)                  100                  69
Profit before interest and taxation          260          528            81
Interest receivable                    128                  124                245
Interest payable                (226)                (245)              (473)
Profit/(Loss) before taxation 1            162            407            (147)
Income tax 2                (4)                (87)                (108)
Profit/(Loss) for the period            158            320            (255)
       
Attributable to:      
Equity holders of the company              182              273 (259)
Non-controlling interest                    (24)                47                4
Profit/(Loss) for the period                158            320            (255)
       
Earnings/(Loss) per share – basic 3 1.70p 2.56p (2.43p)
Earnings/(Loss) per share – diluted 3 1.70p 2.56p

(2.43p)

 

Bisichi Mining PLC

Consolidated statement of comprehensive income for the six months ended 30 June 2016

Unaudited Unaudited Audited

6 months
ended 

6 months
ended

Year
ended

30 June 30 June 31 December
2016 2015 2015
£000 £000 £000
 
Profit/(Loss) for the period 158 320      (255)
Other comprehensive income:    
Exchange differences on translation of foreign operations        490          (217)          (1,167)
Gain/(Loss) on available for sale investments 60 (28) (202)
Taxation (13) 6 41
Other comprehensive income for the period, net of tax    537    (239)        (1,328)
Total comprehensive income for the period    695    81        (1,583)
   
Attributable to:      
Equity shareholders      669    58        (1,500)
Non-controlling interest          26          23          (83)
Total comprehensive income for the period      695    81        (1,583)

 

Bisichi Mining PLC
Consolidated Balance Sheet
as at 30 June 2016
Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
Assets £000 £000 £000
Non-current-assets  
Value of investment properties 12,800 11,620 12,800
Fair value of head leases      186      195      194
Investment property 12,986 11,815 12,994
Reserves, plant and equipment 6,319 6,159 5,374
Investments in joint ventures 1,197 2,909 1,198
Loan to joint venture 1,105 1,029 900
Other investments        25      151       14
  Total non-current assets 21,632 22,063 20,480
Current assets      
Inventories 2,117 1,394 1,049
Trade and other receivables 7,277 8,496 6,187
Corporation tax recoverable 31 29
Available for sale investments 654 768 594
Cash and cash equivalents 2,757    2,789 1,608
  Non-current assets held for sale          –              – 1,168
  Total current assets 12,805 13,478 10,635
Total assets 34,437 35,541 31,115
Liabilities      
Current liabilities      
  Borrowings (2,981) (3,115) (2,267)
  Trade and other payables (6,179) (5,738) (4,234)
  Current tax liabilities      (136)      (23)            –
  Total current liabilities (9,296) (8,876) (6,501)
Non-current liabilities      
  Borrowings (5,961) (5,957) (5,940)
  Provision for rehabilitation (1,028) (919) (847)
  Finance lease liabilities (186) (195) (194)
  Deferred tax liabilities (2,053) (2,210) (2,002)
  Total non-current liabilities (9,228) (9,281) (8,983)
Total liabilities (18,524) (18,157) (15,484)
Net assets    15,913    17,384    15,631
Equity      
Share capital 1,068 1,068 1,068
Share premium 258 258 258
Translation reserve (2,317) (1,870) (2,757)
Available for sale reserves (73) 19 (120)
Other reserves 588 663 574
Retained earnings 16,042 16,819 16,287
Total equity attributable to equity shareholders 15,566 16,957 15,310
Non-controlling interest        347          427          321
Total equity    15,913    17,384    15,631

Bisichi Mining PLC

Consolidated Cash Flow Statement

For the six months ended 30 June 2016

    Unaudited Unaudited Audited
30 June 30 June 31 December
2016 2015 2015
£000 £000 £000
 
Cash flows from operating activities
Operating profit 261 428            150
Depreciation 736 704              1,284
Unrealised (gain)/loss on other investments (11) 1 132
Unrealised gain on investment properties (225)
Share based payment expense 14 11                  31
Share of profit of joint venture 88
Movement in working capital (447) (865)              607
Net interest paid (60) (79)              (248)
Income tax paid/(received) 27              –
Cash flow from operating activities 520 288              1,731
Cash flows from investing activities 378 (1,202)            (2,888)
Cash flows from financing activities (170) (218)              (584)
Net increase/(decrease) in cash and cash equivalents 728 (1,132)            (1,741)
     
Cash and cash equivalents at 1 January (626) 719            719
Exchange adjustment (318) 95                  396
Cash and cash equivalents at end of period (216) (318)              (626)
     
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

2,757 2,789              1,608
Bank overdrafts (2,973) (3,107)            (2,234)
Cash and cash equivalents at end of period (216) (318)              (626)
     

 

Bisichi Mining PLC

Consolidated statement of changes in shareholders’ equity

for the six months ended 30 June 2016

  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 as at 1 January 2015 1,068 258 (1,677) 41 652 16,973 17,315 404 17,719
Profit for the period 273 273 47 320
Other comprehensive income and expense (193) (22) (215) (24) (239)
Total comprehensive income for the period (193) (22) 273 58 23 81
Dividend (427) (427) (427)
Equity share options 11 11 11
Balance at 30 June 2015 1,068 258 (1,870) 19 663 16,819 16,957 427 17,384
Balance as at 1 January 2015 1,068 258 (1,677) 41 652 16,973 17,315 404 17,719
Revaluation of investment properties and impairments 17 17 17
Other income statement movements (276) (276) 4 (272)
Loss for the year (259) (259) 4 (255)
Other comprehensive income and expense (1,080) (161) (1,241) (87) (1,328)
Total comprehensive income for the year (1,080) (161) (259) (1,500) (83) (1583)
Dividend (427) (427) (427)
Equity share options 31 31 31
Share options cancelled (109) (109) (109)
 

Balance at 31 December 2015

1,068 258 (2,757) (120) 574 16,287 15,310 321 15,631
Profit for the year 182 182 (24) 158
Other comprehensive income and expense 440 47 487 50 537
Total comprehensive income for the period 440 47 182 669 26 695
Dividend (427) (427) (427)
Equity share options 14 14 14
Balance at 30 June 2016 1,068 258 (2,317) (73) 588 16,042 15,566 347 15,913

 

ACCOUNTING POLICIES AND NOTES TO THE ACCOUNTS:                                                                                                                                                                       

The results for the six months ended 30 June 2016 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 2015 and which will form the basis of the 2016 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
2016 2015 2015
£000 £000 £000
Revenue  
Mining 10,739 13,378 24,608
Property 530 488              1,014
Other 16 13 33
10,925 13,879 25,655
Operating profit/(loss)  
Mining (73) 286                  (785)
Property 308 131 915
Other 26 11 20
261 428              150
 
             Share of profit in joint ventures (1) 100 69
Interest receivable 128 124 245
Interest payable (226) (245) (473)
Profit/(Loss) before taxation 162 407 (147)

2. Taxation

    Unaudited Unaudited Audited
30 June 30 June 31 December
2015 2014 2014
£000 £000 £000
Based on the results for the period:  
Corporation tax at 20.50% (2015: 20.25%) 142 2 3
Prior year adjustment – UK (23)
142 2 (20)
Deferred taxation (138) 85 128
4 87 108

3. Earnings/ (loss) per share

Both the basic and diluted earnings per share calculations are based on a profit of £182,000 (2015: £273,000). The basic earnings per share has been calculated on a weighted average of 10,676,839 (2015: 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 (2015: 10,676,839) plus the dilutive potential ordinary shares arising from share options of nil (2015: nil) totalling 10,676,839 (2015: 10,676,839).

4. Investment properties

Investment properties are included at valuation as at 31 December 2015 plus additions in the period ended 30 June 2016.

5. Non-current asset held for sale

On the 11 March 2016, the company disposed of its investment in Langney Shopping centre Unit Trust. The net proceeds from the sale were £1,168,000. At 31 December 2015, the share of the net assets of the trust held by the group were £1,168,000 which included a loss on the reclassification of the asset to held for sale in the amount of £138,000.

6. 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 2015. The group paid management fees of £68,750 (30 June 2015: £68,750 31 December 2015: £137,500) to London & Associated Properties PLC, an associated company.

7. 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 2015 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 Services 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 Mining 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 2016 as were used for the year ended 31 December 2015.

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 following new or revised standards that are applicable to the group were issued but not yet effective:

IFRS 9 – Financial Instruments

IFRS 15 – Revenue from Contracts with Customers.

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

  • The valuation of investment properties;
  • Life of mine and reserves;
  • Depreciation;
  • Provision for rehabilitation (relating to environmental rehabilitation of mining areas);
  • Impairment and;
  • Carrying values of mining joint ventures

Investment properties are not re-valued at the half year end unless there is evidence of a material change in valuation. There have been no material changes in fair value during the period. Please refer to page 58 of the 2015 Annual report and Accounts for details on the valuation of investment properties as at 31 December 2015.

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 2015.

There is no material seasonal impact on the group’s financial performance. Taxes on income in the interim periods are accrued using tax rates expected to be applicable to total annual earnings.

The interim financial statements have been prepared on the going concern basis as the Directors are satisfied the group has adequate resources to continue in operational existence for the foreseeable future.

8. Dividend

The interim dividend in respect of 2015, totalling £107,000 was paid on the 5th of February 2016. The final dividend in respect of 2015, totalling £320,000 was approved by the shareholders at the Annual General Meeting held on the 10th June 2016 and was paid on the 29th July 2016. The final dividend in respect of 2015 is included as a liability in these interim financial statements.

A proposed interim dividend for the year ended 31 December 2016 totalling £107,000 was approved by the Board of Directors on 26th August 2016 and has not been included as a liability in these Interim Financial Statements.

9. Principal risks and uncertainties

The Group has an established risk management process which works within the corporate governance framework as set out in the 2015 Annual Report and Accounts. Risks and uncertainties identified by the Group are set out on page 10 of the 2015 Annual Report & Accounts and are reviewed on an ongoing basis. There have been no significant changes in the first half of 2016 to the principle risks and uncertainties as set out in the 2015 Annual Report & Accounts. The principal risks as stated in the accounts reflect the challenging environment in which the business operates and are considered under the following broad headings:

Mining:

  • Coal price
  • Coal washing process
  • Health & safety
  • Currency Risk
  • Coal qualities
  • Currency movements
  • Regulatory requirements & permissions
  • Transport
  • Power supply
  • Flooding
  • Environment
  • Labour
  • Recoverability of investment in new reserves and mining joint ventures

Property:

  • Property valuation
  • Occupancy

10. Board approval

These interim results were approved by the Board of Bisichi Mining on 26th August 2016.

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 10 of the 2015 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
26 August 2016

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 MA (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)
Robert Grobler (Mining Director)
Ethan Dube (Commercial Director)

Registrars and transfer office:

Capita Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU

Telephone 0871 664 0300
(Calls cost 12p per minute + network extras)
or +44 208 639 3399 for overseas callers
Website: www.capitaassetservices.com
E-mail: ssd@capitaregistrars.com

Company registration number:

112155 (Incorporated in England and Wales)

Website: www.bisichi.co.uk

E-mail: admin@bisichi.co.uk