Interim report to shareholders for the 6 months to 30 September 2016
/Financial Result
Your directors submit the unaudited financial statements of Chatham Rock Phosphate Limited (CRP) for the six months to 30 September 2016. The trading result for the period was a loss of $468,831 (2015 loss of $398,076). An analysis of the result is provided in the table below
| 6 months to 30 Sept 2015 | 6 months to 30 Sept 2016 | |
|---|---|---|
| Income | 16 | 3,033 |
| Expenses | (398,092) | (471,864) |
| Net Profit (loss) before income tax | (398,076) | (468,831) |
| Income tax | - | - |
| Net profit (loss) after tax | (398,076) | (468,831) |
The increased deficit for the six months to 30 September 2016 can be largely attributed to legal fees relating to the TSX.V listing/merger and the disputes with NZPaM (permit fees over-charged 900%) and the EPA cost recovery billing dispute. These are all one-offs and not expected to continue.
Fundraising
We’ve achieved some very satisfying milestones during 2016. The highlight has been raising sufficient new capital to continue to progress our projects for the next 15 months.
Our share purchase plan seeking $600,000 was oversubscribed. Thank you everyone who subscribed, many sticking with us for several years and continuing to share our faith in our ultimate success.
We’ve also made various share placements to qualified investors (new and existing) over recent months and are also delighted to have new cornerstone shareholders from Malaysia, Switzerland and Germany.
Since the initial rejection by the Environmental Protection Authority of our marine consent application in February last year we have raised $3.7 million – despite our share price having been slaughtered.
While we’ve had to dilute some existing shareholders to keep Chatham functioning by raising capital at much lower prices, we believe preserving some value and delivering on our goals will ultimately produce strong returns for all shareholders.
Our ability to raise money against the odds underscores the fundamental attractiveness of the Chatham Rise project and the perceptiveness of our ever-enlarging shareholder base. Directors and management interests, along with our two new cornerstone investor groups, now each hold about 13% of the company.
The present share price of 0.9c values Chatham at $7.5 million – less than a fifth of our market value in February 2015. We believe Chatham is now in a stronger position than it’s ever been due to the knowledge gained during the marine consent application process.
Takeover Offer
This week we received a notice of takeover offer from Antipodes Gold which will enable Chatham to list on the Toronto Stock Exchange. The actual takeover offer will be despatched just before Christmas and we are expecting that the process will be largely completed by the end of January 2017.
Antipodes approved the proposed reverse takeover of Chatham a year ago, by July we had secured funding to operate until the end of 2017, and have subsequently been engaged in the process of securing approval to merge. We now expect the merger documents to go out within the next few days.
Together with the Antipodes shell we inherit some funds associated with the merger, a Toronto director, 1,003 resources-sector shareholders in a number of countries, and a Canadian corporate support structure. This merger will strengthen Chatham, complement our New Zealand listing and provide new opportunities for existing Antipodes shareholders.
Recommending Chatham shares
During our capital raising in June we met with Geneva based investment banking firm RAMPartners SA whose analysts prepared an independent research report, which is now on our website.
Key points include a buy recommendation with a price target of 50c compared with the current market price of 0.9c. RAMPartners project value of $472 million makes assumptions relating to the market price of rock phosphate, Chatham’s production costs and relevant currency interactions. It includes a detailed examination of the permit risk Chatham still faces and the evolving factors mitigating this risk.
Encouragingly the valuation also concludes our management team “has the necessary skills, ability, devotion, focus and skin in the game” to make our project work. The full research report is available to review on our website.
Operational Focus
Chatham will be reapplying for a marine consent following further consultation with stakeholders, a potential revision of the project and further research on some scientific issues. We’re also:
Working with government ministries on improving the permitting process
Observing Trans Tasman Resources progressing on its marine consent application and taking heed of their modified approach
Developing trading relationships with participants in the phosphate sector
Sourcing on-shore rock phosphate deposits
Building farming sector, academic, industry and central government support for the use of
Chatham rock phosphate as an environmentally friendly product
Commissioning further pot tests to be followed by field trials
Presenting at fertiliser, resources sector and environmental conferences.
Both we and the EPA have learned a lot from our initial consent application. We’re confident this will result in improved application and hearing processes and we’ll resubmit an even better application to robustly deal with the issues on which we were rejected.
Chatham Rock Phosphate speaks at UMC conference
Chatham Rock Phosphate (Chatham) was a keynote presenter at the Underwater Mining conference held at Incheon in South Korea in October. Chatham CEO Chris Castle updated the scientists, marine miners, sector investors and other industry players attending the conference from 17 countries on the company’s present status and forward plans.
His address, the central theme of this being that Chatham is back on track, will be re-submitting a marine consent application and is not going away, was warmly received. The project is very much on the world stage and it’s clear that the New Zealand Environmental Protection Authority’s ability to effectively evaluate marine mining proposals is under an international microscope.
Chatham rock phosphate’s many benefits
We continue to believe the Chatham Rise project remains hugely valuable for all the same reasons:
- Environmental benefits
- much lower run off to lakes and rivers
- very low cadmium
- much lower carbon footprint
- Security of fertiliser supply for farmers
- An ethical source – New Zealand’s main source of phosphate is from a disputed territory
- Highly profitable – forecast annual earnings of $90 million before royalties and tax, with low mining costs - equivalent to shipping cost
- Good for New Zealand:
- $34 million in annual taxes and royalties
- millions in port charges
- high-value, knowledge-based jobs in the port, on the mining ship, doing environmental monitoring and scientific research, in agriculture and hospitality and the Chatham Is
- New Zealand could become a world leader in marine technology and expertise potentially worth billions of dollars
- Our work at sea enhances knowledge of our marine environment to help identify areas most deserving of conservation.
For all these reasons we remain puzzled by environmental groups which, through opposing our Chatham project, condone New Zealand importing all our phosphate needs, so exporting our environmental footprint to countries mining phosphate where it involves severe social and environmental distress.
Marine mining is not new
Contrary to the proposition advanced by poorly informed anti-marine mining advocates, marine mining is not a new idea. Tin mining in Asia, diamond mining offshore South Africa and Namibia, and most significantly, aggregate mining offshore the United Kingdom and other European countries has been undertaken for several decades. In the UK and Europe the construction industry (roads, buildings, etc) relies heavily on raw materials recovered from the ocean.
In parallel, maintenance dredging of river channels and port entrances has been routinely undertaken for at least a century. The environmental impact of this activity is the same, is much closer to coastal communities and has accordingly been subject to rigorous scrutiny for a very long time.
How the use of RPR will improve water quality in NZ
OVERSEER is a software tool widely used by New Zealand farmers and their advisors to tailor fertiliser use to optimise farm production while minimising environmental impacts.
Developed originally by AgResearch, it’s now jointly owned with the Ministry of Primary Industries and the Fertiliser Association. An independent organisation, Overseer Ltd, has been licensed to use the OVERSEER IP to create a sustainable business that delivers OVERSEER to users.
Recently the software application was upgraded and the latest version 6.2.3 was used to compare various farming scenarios to assess what impact changing the type of phosphate fertiliser used has on the amount of P loss to water. In all scenarios evaluated the use of RPR resulted in less phosphate loss to water than would be the case with soluble phosphate fertilisers such as Superphosphate.
When OVERSEER was used to compare various farming scenarios the P loss was on average 18% lower when RPR fertiliser was used compared to using Superphosphate. According to independent studies, changed farming practices resulting from using RPR over an extended period could result in up to 80% less phosphate run-off.
This advance provides more evidence for farmers and their advisors that RPR offers a more environmentally friendly source of phosphorus to New Zealand farmers. Over time this should result in increased use of RPR as it is substituted for superphosphate and other phosphate fertilisers.
This is very relevant to Chatham Rock Phosphate because our rock phosphate is a particularly effective form of reactive rock phosphate, demonstrated by extensive field trials undertaken in the mid-1980s and reinforced by recent tests.
As well as representing a secure local source, Chatham Rise-sourced RPR contains ultra-low levels of cadmium levels and creates far fewer carbon emissions, so has a much lower carbon footprint than current northern hemisphere supplies.
As the Chatham Rise deposit will likely not be mined until 2020, we have identified several overseas sources of RPR and can import this rock on request. We are already working with a private New Zealand-based fertiliser company to satisfy the existing demand for reasonably priced material.
Spreading the risk
We’re confident we will get environmental approval next time, but we want to broaden our investor appeal by becoming a more diversified operation so not all our eggs are in one basket.
As well as the five marine applications in Namibia, we are developing relationships with other players in the market, maintaining our relationship with Boskalis, looking at other projects and entering the phosphate trading market.
Looking Forward
The second half of this financial year should see CRP make significant progress including the merger with Antipodes Gold (and the associated TSX.V) listing, achieve further progress toward the resubmission of our marine consent application, and a further fundraising programme in order to finance the reapplication.
Chris Castle, Managing Director
Robert Goodden, Chairman
December 22, 2016
Interim Report 2015
/Click image below to read report in full.
Chatham Rock Interim Report for the six months to 30 September 2014
/To read the report - click here
NZX Announcement: Interim report for the 6 months to 30 September 2013
/Dear Chatham Rock Phosphate shareholder,
This announcement was filed with NZX earlier this morning.
Regards,
Chris Castle
CEO
Chatham Rock Phosphate Limited
P.O. Box 231, Takaka 7142
Mobile: +64 21 558 185
chris@crpl.co.nz
Skype: phosphateking
www.rockphosphate.co.nz
To download the report in PDF form - click here
Interim report for the 6 months to 30 September 2013
Directory
Directors: Chris Castle, Jill Hatchwell, Linda Sanders, Robin Falconer, Ko De Blaeij, Robert Goodden
Project Team: Chris Castle, Dr Robin Falconer, Cam McKenzie, Ray Wood, Dr Mike Patrick, Najib Moutia, Linda Sanders, Professor Jim Johnston, Dr Ray Kelly, Dave Jennings
Project partner: Royal Boskalis Westminster NV, The Netherlands
Contacts: +643 525 9170 or +6421 558 185 or chris@widespread.co.nz
Website: www.rockphosphate.co.nz
Headquarters: Level 1, 93 The Terrace, Wellington, NZ
Postal: P O Box 231, Takaka 7142 NZ
Registered office: Duncan Cotterill, Tower Building, 50 Customhouse Quay, Wellington
Share registry: Link Market Services, 138 Tancred St, Ashburton
Auditors: KPMG, 10 Customhouse Quay, Wellington
Legal Advisers: Duncan Cotterill, Tower Building 50 Customhouse Quay, Wellington
Simpson Grierson, HSBC Tower, 195 Lambton Quay, Wellington
Bankers: ANZ Banking Group (NZ) Ltd, 215-229 Lambton Quay, Wellington
Financial Result
Your directors submit the unaudited financial statements of Chatham Rock Phosphate Limited (“CRP”) for the six months to 30 September 2013. The trading result for the period was a loss of $675,788 (2012 loss $870,000). An analysis of the result is provided in the table below
The deficit for the six months to 30 September 2013 reflected continued high activity levels of our work programme for the Chatham Rise Rock Phosphate Project.
Operations highlights
We continue to make significant progress across a number of fronts though it can sometimes seem like two steps forward and one step back.
One of the more exciting developments has been our recent application for two new prospecting licences adjacent (to the west and east) of our existing prospecting licence. It follows the decision by Kiwi Phosphate to relinquish its interests in the area.
We have identified areas within that territory where we believe that there are commercially viable deposits. We don’t envisage our total mining footprint will increase significantly but the additional areas under our control would enable us to cherry pick the best deposits and leave significant fallow areas.
Mining Licence
Our main focus for the period under review has been on attaining the grant of a Mining Licence through the Government agency New Zealand Petroleum and Minerals.
We had initially expected approval shortly after the passing of the new Crown Minerals Act in late May. However the process has proved longer and more complex than we anticipated and so your Board decided to focus on achieving that licence before submitting our application for the “second leg of the double” – the Marine Consent.
The team has worked to satisfy the requirements of the new regime. This has involved weekly progress meetings with officials and the provision of considerable additional information.
We share our shareholders’ frustration about the delays to the project’s time frames this has caused. As the first of this type under the new Crown Minerals Act NZP&M has undertaken a robust assessment process, but the upshot is it has taken considerably longer than we expected.
We are continuing to make good headway in gaining our Mining Licence and at the time of writing we are confident we are close to getting over the line, with the final few outstanding issues close to being resolved.
Marine Consent
The additional time and cost involved in the Mining Licence process has meant the Marine Consent time-line has been pushed into 2014.
We plan to submit our formal application in the first quarter of the New Year. The centrepiece of this application is a comprehensive Environmental Impact Assessment, comprising well over 1200 pages and including more than 30 reports produced by a variety of experts.
We produced a near-final version in early July before deciding to hold off formally submitting it. Since then the team has worked to further improve it – incorporating recent data gathered by NIWA, and building in feedback from peer-reviews and ongoing consultation.
The consultation has been very valuable as it has raised questions we’ve been able to address and has helped us hone and simplify the messages we consider central to an understanding of our proposals.
Capital raising
Our capital raising has continued during the period. We undertook an Initial Public Offering in the New Zealand market in June, with limited success. We raised around $1.5 million and gained another 125 local shareholders during an offering that involved a roadshow around New Zealand, numerous media interviews and promoting the offer at the Field Days event at Mystery Creek near Hamilton.
We were proud of the offer document produced, which received a lot of favourable comment as providing an informative profile of the project.
While we continue to be on the radar of some local institutions, they are waiting for the project to be “de-risked” through gaining the Mining Licence and Marine Consent before taking the plunge.
In the meantime we have attracted further investment from predominantly international investors, primarily private equity funds and high net worth individuals.
We have raised $24.5 million over the past three years. Many of our original investors continue to support our various capital raisings and your board remains grateful for your continued support.
The Edison Group provided an update of our operations in September, which assessed Chatham’s value above $2, based on an analysis of our business plan.
Consultation and conferences
During the period we’ve continued to engage with stakeholders, including meetings with Labour MPs, another visit to the Chatham Islands and environmental groups.
We’ve presented at conferences both internationally – including our fourth Underwater Mining Institute forum – and in New Zealand, where we’ve spoken to The Australasian Institute of Mining and Metallurgy, the Institute of Chartered Accountants and a Mining Summit targeting international investors.
The focus ahead
Once we receive the Mining Licence we will re-engage with a range of local and international investors to raise the capital needed to fund the Environmental Consent process. These investors have continued to follow our progress with interest and we anticipate renewed support from a number of them post the mining licence grant.
Based on our current business plan we anticipate receiving our Marine Consent in the 3rd quarter of 2014. During that period we’ll continue to work with our technical partner Boskalis on ship design prior to starting the two-year ship conversion process.
Our revised target date for starting operations is now in the second half of 2016.
Change in Auditor
We can also advise that Crowe Horwath has resigned from the office of auditor of the company. We thank Crowe Horwath for their assistance over their time as auditor. The Board has appointed KPMG as the new auditor of the company.
On behalf of the Board
Linda Sanders Chris Castle
Chairman Managing Director
22 November 2013
Widespread Energy Limited Interim Report
/A summary of the latest progress on the Chatham Rise rock phosphate project was issued to shareholders of project owner Widespread Energy Ltd and the New Zealand Stock Exchange today.
Widespread Energy Limited
Interim Report
Six months to 30 September 2010
Financial Result
Your directors submit the unaudited financial statements of Widespread Energy Limited for the six months to 30 September 2010. The trading result for the period was a loss of $185,000 (2009 loss $29,000). An analysis of the result is provided in the table below:
Six months to 30 Sept 2010 ($,000) Six months to 30 Sept 2009 ($,000) Income 15 29 Expenses (117) (58) Exploration costs written down (83) Net Profit (loss) before income tax (185) (29) Income tax - - Net profit (loss) after tax (185) (29)
The increased deficit for the six months to 30 September 2010 reflected a significantly more active period as the first year programme for the Chatham Rise Rock Phosphate Project kicked off. The write-off of expenditure relating to PEP 50439 (following the decision to relinquish it) also adversely affected the result.
Operations Review
Widespread Energy holds the following investments:
Mineral Prospecting Licence (MPL) 50270 covering an area of 4,726 km2 on the central Chatham Rise that includes significant seabed deposits of rock phosphate and other potentially valuable minerals. (90% Widespread Energy, 10% Widespread Portfolios)
Petroleum exploration permit (PEP) 38526 over the prolific oil seeps at Kotuku on the West Coast (100%)
An 11.8% interest in Green Gate Limited, the holder of PEP 51150 in Taranaki.
An investment in Akura Limited, a Fiji based private company, which holds three Petroleum Exploration Licenses in Fiji, predominantly offshore.
Chatham Rise Project Background
On 25 February 2010, a consortium comprising Widespread Energy and associated company Widespread Portfolios Limited, (“the Joint Venture or JV”) was granted an offshore prospecting permit by the Crown Resources division of the Ministry of Economic Development covering an area of 4,726 km2 on the central Chatham Rise. The permit area, which is in New Zealand territorial waters, is located 600 km east of Christchurch and includes significant shallow seabed deposits of rock phosphate and other potentially valuable minerals.
The initial term of the permit is two years with further priority rights to either extend the prospecting permit or apply for a mining licence.
An independent valuation of the project by Rockpoint Corporate Finance earlier this year found the project had a realistic possibility of being commercially viable.
It found that, based on conservative modelling, the project has a current value of $20.9 million and could earn net profit before tax of $40 million a year.
Widespread’s own models put the NPAT figure as high as $80 to $100 million a year.
In addition to its financial potential, the project offers a number of benefits to New Zealand including:
Reduced exposure to currency and commodity risk and reduced import burden
Known, fixed costs
Reduced carbon footprint from lower transport costs
Possible export earnings
The project is also New Zealand owned and controlled.
The challenges identified of extracting the resource include its sporadic distribution (it averages 66 kg/m but there is great variability). Also extracting phosphate at 400m depths has not been achieved, though other minerals have been extracted at greater depths. The phosphate, in nodules of 2mm to 150mm, is located in a 1m layer of sandy silt above a chalky clay sediment basement.
Environmental considerations are an important part of the work being done and the company has a wide-ranging programme of consultation with fishing, conservation, Maori and other interest groups.
Widespread Energy Ltd continues to make rapid and significant progress on its Chatham Rise Rock Phosphate Project.
Milestones
Recent milestones include:
Enhanced international profile of the project through speaking at an international underwater mining conference in Russia
Successful meetings in Europe and subsequently in New Zealand with representatives of the world’s largest dredging companies
Development of a dialogue with the German science establishment concerning previous research work undertaken on the Chatham Rise
Ongoing discussions with research ship operators
Establishment of a Chatham Rise linked university research programme
Submission to Crown Minerals of two completed reports required as part of the year-one work programme
Further oceanographic and environmental research commissioned
Initiation of a dialogue with fertiliser sector parties
Following on from his presentation to the Underwater Mining Institute conference in Gelendzhik, Russia, Widespread director Chris Castle and project principal scientist Dr Robin Falconer met in Europe with several leading dredging companies. Meetings were also held with the owners of research ships and with German science organisations.
Four of the five dredging and undersea mining companies met expressed interest in the project and in either adapting existing underwater mining technology or developing new purpose-built technology. Discussions are ongoing.
Three meetings were held with sections of the German science establishment to re-establish links with the organisations centrally involved in the Chatham Rise exploration and research projects that took place in the late 70s/early 80s. The exploration cruises of the RV Valdivia and RV Sonne, were accompanied by a sizeable contingent of New Zealand and German scientists. The recent meetings gave a much better understanding of the cruise data still held in Germany and possible ways it could better assist our knowledge of the phosphorite deposit.
A meeting was also held with representatives of the company that operates RV Sonne with a view to possible use of the ship when in New Zealand waters during 2011. Discussion on the use of this vessel and other alternatives are also ongoing.
The Widespread Joint Venture has also agreed to sponsor a university research programme related to certain properties of the phosphorite nodules and is seeking to fund other related university research.
Widespread has also recently commissioned NIWA to undertake further work to enable us to more completely understand the oceanographic and benthic characteristics of our license area in the context of the entire Chatham Rise.
Project Timing
The Joint Venture is still on track to complete its first year work programme by Christmas 2010 – two months early. At the time of writing it also appears likely that environmental baseline monitoring and other data collection at sea (notionally part of the second year programme) will be commenced well ahead of schedule.
The second year of activity will include ongoing environmental baseline monitoring, further definition of the resource, and completion of a bankable feasibility study following ongoing seabed sampling, and concept design of plant to recover rock phosphate from the seabed.
Offshore Listing of Chatham Rise Rock Phosphate Project
The two companies that hold the Chatham Rise Joint Venture are listed in New Zealand. Widespread Energy Limited (with a 90% interest) is listed on the smaller NZAX market and Widespread Portfolios Limited (with a 10% interest) on the main board NZSX market. Both are thinly traded, because they are small and operate in a sector (mining and mineral exploration) that is scarcely researched and which attracts relatively few local investors.
Further, there are no NZX listed fertiliser companies, therefore no comparable stocks, and therefore little point (despite its present $20.9 million independent valuation) in listing the project on the local market.
On overseas markets the activities of minerals and fertilizer sector companies are better understood, regularly researched and form a legitimate part of many investor’s portfolios. As a result these companies are often readily able to raise significant quantities of new capital to finance exploration and project development.
These factors have lead the Boards of Widespread Energy and Widespread Portfolios to conclude that the interests of both groups of shareholders would be far better served if the Chatham Rise project were to be restructured with a view to a new listing in an overseas sharemarket.
The markets under consideration are the ASX (Australia) and TSX.V (Canada). No final decision has been made yet but it appears the lack of local depth and investor interest in financing projects of this nature have made the decision to list offshore an inevitability.
The current thinking of the two Boards is that Widespread Energy could become a dedicated vehicle for the Chatham Rise Project prior to an offshore listing occurring. This would likely mean transferring all other Widespread Energy investments as well as undertaking an issue of shares to Widespread Portfolios so that Widespread Energy then holds 100% of the Chatham Rise Project. The key benefits from this approach are that the operations of Widespread Energy would be singularly focussed for taking to an offshore market to raise capital and a New Zealand domiciled and listed company would remain a significant shareholder.
If a restructuring did occur in the above manner a number of approvals would be required under the Takeovers Code, NZX Listing Rules and from Crown Minerals. Independent adviser reports would also be necessary. Therefore all shareholders would receive significant information and the opportunity to express their views before any such restructuring was implemented.
Oil and Gas Interests
PEP 38526 - Kotuku
PEP 38526 is located north of Lake Brunner, on the West Coast, South Island. The permit covers the northern half of the Kotuku Structure and a significant portion of the associated Grey Valley Trough.
As part of the year-two work programme Widespread Energy started drilling a stratigraphic exploration bore in mid March 2010. The aims of the bore were to confirm the shape of the Kotuku anticline, recover samples of the rock strata and determine the nature of any fluids contained within it.
The drill rig encountered technical issues shortly after commencing Widespread 1 and relocated to an adjacent site and spudded as Widespread 1A. A week later Widespread 1A encountered oil shows from 21m-90m, and then began to flow gas from 90m depth. The gas was not expected to be encountered at this depth so well control procedures were undertaken and the flow of gas was shut off so that a coring rig could be mobilised in order to continue drilling to the target depth of 250 metres.
In mid April Widespread 1A was recommenced and several attempts were made to re-enter the well. These failed (due to engineering difficulties with the 6 inch casing) and the decision was made to plug and abandon the bore.
While the target depth of 250 metres was still not reached the earlier persistent oil shows that occurred between 21 metres and 90 metres are of considerable interest.
We are have undertaken a detailed analysis of the data gathered to date and are now planning the next stages of the exploration programme. Potential partners to assist with both financing and operating this exploration programme are presently being sought.
PEP 38526 also contains a number of other promising targets so our interest in this licence remains very much alive and well.
Green Gate Limited
Green Gate was established as a private oil and gas exploration company in 2003, and built up a promising portfolio of South Island focused petroleum exploration permits in North Canterbury, Murchison and the Solander/Great South Basin as well as a one third interest in PEP 51150 in Taranaki.
However, falling oil prices and difficult equity market conditions have severely hampered Green Gate’s exploration strategy and the company now holds only one PEP, a 100% interest in PEP 51150.
At 374.2 km2, on-shore PEP 51150 in South Taranaki is one of the larger blocks granted and is surrounded by producing oil and gas fields – Kapuni to the west, Cheal and Waihapa to the north, Kauri to the southeast and the offshore Kupe mining permit (under development) to the south.
Green Gate has identified a number of prospects in the course of its pre-bid study and is presently expected, subject to rig availability, to drill an exploration well in 2010.
Akura Limited
Widespread Energy continues to hold a small investment in Akura Limited, a Fiji based private company, which has recently been granted three Petroleum Exploration Licences by the Mineral Resources Department of Fiji. These cover an area of 17,667 square kilometres, most of this being offshore of Fiji.
Interim Fundraising Programme
It was announced on 25 October that Widespread Energy would undertake an immediate fundraising programme with the intention of raising $1.2m to $1.5m.
The funds would be utilised for working capital, to finance the initial steps of the Chatham Rise year-two work programme and fund costs relating to the overseas stock exchange listing. The listing process was expected to take six months with a present target date of early May 2011.
The interim financing programme will consist of private placements to suitably qualified investors, and a share purchase plan with the provision for any shortfall to be placed with qualified habitual or strategic investors.
The first stage of the financing programme concluded last week with the successful placement of 1,250,000. shares @ 12 cents. The share purchase plan is now underway and discussions are ongoing in respect of further possible placements
Outlook
Following the grant of the Chatham Rise MPL in February the direction of your company has been transformed with a primary focus on advancing development of this strategically located rock phosphate deposit.
A lot has been achieved in a very short time and it’s intended that this project continue to be as rapidly progressed as we can manage with the resources at our disposal. A successful IPO during 2011 will materially assist us with the achievement of this objective
For and on behalf of the Board,
Keith T Hindle
Chairman Chris D Castle
Director
Onekaka
21 November 2010
NZX Format Result Summary
Results for announcement to the market Reporting Period Six months to 30 September 2010 Previous Reporting Period Six months to 30 September 2009 Amount (000s) Percentage change Revenue from ordinary activities $15 $29 (48%) Profit (loss) from ordinary activities after tax attributable to security holder ($185) ($29) (538%) Net profit (loss) attributable to security holders ($185) ($29) (538%) Interim/Final Dividend Amount per security Imputed amount per security It is not proposed to pay a dividend for the reporting period N/A N/A Record Date Not Applicable Dividend Payment Date Not Applicable Comments: Widespread Energy has not gained or lost control over any entities during the year. There have been no major changes or trends in Widespread Energy’s business subsequent to 30 September 2010.
There are no unrealised gains resulting from the revaluation of assets included as separate items after profit before extraordinary items.
The operating deficit has increased considerably due to exploration expenses written off. These costs had been capitalised in relation to Permit 50439, Offshore West Coast which was surrendered during the period. As the Company has expanded its business, the costs associated with running a business have also increased. Primarily Directors Fees were $35,000 this half year compared to nil in the half year to September 2009.
Widespread Energy does not operate any dividend or distribution reinvestment plan.
Widespread Energy has not gained or lost control over an entity during the Reporting Period.
Widespread Energy, with a 90% interest, has an unincorporated joint venture with Widespread Portfolios Limited who has a 10% interest.
The joint venture holds the prospecting permit for the Chatham Rise Rock Phosphate project.
+64 21 5581985
chris@crpl.co.nz
PhosphateKing