TIDMPHE
RNS Number : 6481R
Powerhouse Energy Group PLC
30 June 2015
30 June 2015
PowerHouse Energy Group plc
("PowerHouse" or the "Company")
Final results
PowerHouse announces its audited results for the year ended 31
December 2014. A copy of the annual report and accounts will be
posted to shareholders today and will be available shortly from the
Company's website, www.powerhouseenergy.net. A notice of the
Company's annual general meeting will be sent to shareholders in
due course.
PowerHouse also announces changes to the terms of the
convertible loan agreement signed on 8 October 2012 (the
"Convertible Loan Agreement") by which Hillgrove Investments Pty
Limited ("Hillgrove) has been providing adequate financial support
to the Company to meet its legitimate obligations as and when they
fall due, and to ensure PowerHouse operates as a going concern for
the twelve months from 30 June 2015, pending any unforeseen or
material changes to the Company's current circumstances. The
changes to the Convertible Loan Agreement constitute a Related
Party Transaction under the AIM Rules for Companies as Hillgrove
(including its Associates) is a Substantial Shareholder of the
Company. The Board (excluding Mr Allaun, who is not considered
independent for this purpose) consider, having consulted with
Allenby Capital Limited, the Company's Nominated Adviser, the
changes to the Convertible Loan Agreement are fair and reasonable
insofar as shareholders of the Company are concerned. Further
details of the changes to the Convertible Loan Agreement can be
found below.
For additional information please contact:
PowerHouse Energy Group plc
Keith Allaun +44 (0) 7887 588 941
Allenby Capital Limited (Nominated Adviser and Broker)
Nick Harriss/David Hart +44 (0) 20 3328 5656
CHAIRMAN'S STATEMENT
Thank you for supporting PowerHouse Energy Group plc for another
year. As you are well aware, 2014 proved to be as disruptive and
challenging as any year the Company has faced.
Our expectation upon acquiring the Pyromex technology was that
we would have full cooperation from its technical and management
teams, as well as operational partners, in Switzerland and Germany.
Unfortunately, that was not the case. After exhaustive efforts to
recover relationships already severely damaged by the previous
management of Pyromex, and upon having full and complete access,
for the first time, to the technology, historical and testing data,
and the Eiting facility, the Board of PowerHouse made the difficult
decision to abandon further development of the Pyromex technology
and focus on its in-house proprietary technology for ultra-high
temperature gasification with a new team based on a new
approach.
As highlighted in various announcements the Company made in late
2014, the Board was still confident that we could overcome the
difficult technical challenges with the acquired technology and
create a long-term relationship with our partners in Munich.
Unfortunately, by early 2015, it became evident that those
relationships were irreparable, the technology was seriously
flawed, and it became obvious that it was in the best interests of
the shareholders of PowerHouse to wind-down both the Swiss and
German operations. The Company issued an announcement on 6 February
2015 about the closing of its Pyromex division in Switzerland and
the demonstration facility and small testing unit in Munich.
The decision to close down Pyromex and focus on newly engineered
Australian Technology, the G3-UHt System, is expected to benefit
the Company greatly. It has allowed us to develop a more robust and
reliable technology, based on the latest science of ultra-high
temperature gasification, and incorporates significant improvements
and efficiencies. Equally as importantly, the new technology
represents a truly commercial Waste Gasification Technology which
has a much lower cost base.
Questions that had plagued the Pyromex technology since the day
we purchased it were answered and eliminated as risk-factors.
Additionally, with the elimination of the Pyromex issues we gained
complete control of every component of the engineering life-cycle:
the science, the development, the engineering, the testing regimes,
and the ultimate deployment of the G3- UHt technology.
The closing of Pyromex has allowed the Company to focus on
completing the development process in a reliable (and documented)
manner which we know will afford PowerHouse the opportunity to
expand its market approach and secure opportunities in the
Waste-to-Energy market in Asia and the Middle East.
It is my role for the immediate future to focus upon ushering in
our newly developed technology and building out the commercial
marketing and sales efforts.
As has been demonstrated by newly derived taxation schemes in
the UK, the EU, and more often these days, within the ASEAN
markets, landfill will no longer be considered an acceptable
solution to the challenges of waste disposal. Waste products that
are not recyclable are imbued with a tremendous amount of
recoverable energy. Waste that is land-filled, or incinerated,
today can be gasified, reducing the impact on the land, and the
potential threat to groundwater supplies. The energy recovered can
produce thousands of megawatts to heat and power our homes. It can
be recovered in a manner that is far superior in efficiency and far
more environmentally friendly than incineration.
Depending on the calorific value of the waste-stream
("feedstock") available to PowerHouse, the G3- UHt technology can
potentially convert each tonne of municipal solid waste into one
megawatt of electricity. Every 24 tonnes of waste will generate one
megawatt of electricity per day. If we process 1,000 tonnes of
waste per day, we can potentially produce 42 Mw of saleable,
renewable, green power.
The newly established goal of PowerHouse is to lead the
development of power generation infrastructure for our cities. Our
aim is to build a minimum of 1000 megawatts of power generation
capacity in conjunction with waste-sites, transfer stations, and
biomass producers over the next five years. This represents a
significant evolution of our recent business objectives. However,
it is a vision worth outlining and pursuing.
Recycling is increasing everywhere. However, waste will neither
be eliminated in this, nor the coming generation. The Board hopes
that PowerHouse can help to solve the problem of waste-elimination
and become a key provider of power infrastructure.
The worlds' population continues to grow. More and more of our
population is moving to the middle class and consuming more
electricity than ever. Electrical demand is outstripping electrical
generation throughout the ASEAN region and India. The two key
issues of how to produce clean, green and renewable, power and what
to do with the waste of billions of people in an environmentally
accepted manner, will become ever more important as time goes
on.
Our approach is an expansion of the plan we have been developing
over the past three years: working to not only develop the
technology to use in partnership and joint-ventures with existing
waste facilities, but to also acquire, own, and manage waste
facilities on which we will operate our technology.
We are currently in the process of identifying locations which
will allow us to build waste driven (municipal solid waste, tyres,
biomass) power stations sites using the PowerHouse Gasification
processes and systems like the G3-UHt.
Obviously the Company will require significant restructuring and
build-out to achieve this vision. The first step of that
restructuring was the winding-down of the Pyromex entities. This
allows us to move forward with a fresh start and jettison the
baggage inherited from prior management. This is the first of
several steps that will allow us to achieve our vision, and it will
require tremendous effort on the part of the team and our partners,
but I know that I speak for all when I say that the near-term
sacrifice will be worth the achievement of our larger vision.
This larger vision is in complete accord with our previously
stated goals. However the execution has yet to meet our
expectations. As a management team and as a Board, we believe in
the potential of our technology.
We are within 30 days of completion of the commissioning of the
newly designed PHE G3-UHt Gasification System in Australia. This
unit will demonstrate the complete process: from feedstock
injection, to the gasification of waste, to the cleanup of the
synthesis gas, and finally, to generation of electricity. A
complete, well-tested and proven technology model that we can
rollout commercially.
Our intention is to secure several waste sites through various
contracts and to commence low-volume pilot operations. Additionally
we will continue to test multiple feed-stocks and provide on-going
data for continuous development and improvement of our entire
system.
We hope that within the coming year, we will commence
construction of our first large-scale, commercial, waste-to-energy
electrical generation site. Each site will be secured by a third
party power-purchase agreement (PPA,) effectively monetizing all
electricity produced on site.
The above model will be enhanced in many markets by acquiring,
or splitting the "tip fee" for the acquisition of feed-stock.
However in some Asian markets the tip-fee is negligible, but the
PPA, alone, will generate a tremendous return on investment given
our innovative technology, low-cost of manufacturing, and modular
design.
As shareholders will be aware, PowerHouse has for some time been
relying exclusively on the continuing financial support provided of
Hillgrove Investments Pty Limited ("Hillgrove"). This support has
been provided by advances under a convertible loan note facility
dated 19 June 2012 (the Convertible Loan Agreement"). As at 31
December 2014, the amount owing to Hillgrove under the convertible
loan note was GBP2,181,004. Subsequent to the financial year end, a
further GBP90,000 of advances have been provided under the
facility. On 26 June 2015, Hillgrove provided a letter of comfort
to the Company confirming that it is willing to continue to provide
adequate financial support to PowerHouse to ensure the Company may
meet its legitimate obligations as and when they fall due, and to
ensure it operates as a going concern for a period of at least
twelve months from 30 June 2015, pending any unforeseeable or
material changes to the Company's current circumstances.
In order to provide the on-going financial support outlined
above, it is a requirement of Hillgrove that the Company agrees to
the following new conditions to the Convertible Loan Agreement:
-- Hillgrove may convert notes issued under the Convertible Loan
Agreement at its sole discretion, with the Company being required
to act on a notice of conversion within 14 days of receipt of such
notice;
-- The conversion price for all current and future amounts
issued and to be issued under the Convertible Loan Agreement is
changed from 1.0 pence per ordinary share to 0.5 pence per ordinary
share; and
-- Powerhouse must complete relevant commercial negotiations,
demonstrated by signed contracts, so as at least one commercial
Waste-to-Energy project is commenced within the next 12 months.
If Hillgrove deems that a breach of these conditions or a
material change has been made, it will give PowerHouse 30 days
notice for the breach to be remedied. If the breach is not remedied
within 30 days then Hillgrove reserves its rights under the
Convertible Loan Agreement to call for immediate repayment of all
outstanding amounts under the Convertible Loan Agreement.
As the proposed conversion price of 0.5 pence per ordinary share
is below the nominal value of the Company's existing ordinary
shares, the change to the conversion price outlined above will
require the approval of PowerHouse shareholders at general meeting.
The Company intends to seek shareholder approval for this change at
its Annual General Meeting to be held in September 2015. Notice of
this meeting will be sent to shareholders in due course.
If at any time Hillgrove was to withdraw its on-going financial
support of PowerHouse, then it is likely that the Company would
have insufficient funds to continue and the Company would no longer
be a going concern. In addition, if PowerHouse shareholders do not
approve the resolutions necessary to effect the change in
conversion price outlined above, this may also lead to Hillgrove
withdrawing its financial support.
The changes to the Convertible Loan Agreement constitute a
Related Party Transaction under the AIM Rules for Companies as
Hillgrove (including its Associates) is a Substantial Shareholder
of the Company. The Board (excluding Mr Allaun, who is not
considered independent for this purpose) consider, having consulted
with Allenby Capital Limited, the Company's Nominated Adviser, the
changes to the Convertible Loan Agreement are fair and reasonable
insofar as shareholders of the Company are concerned.
The opportunities for the Company continue to grow with
inquiries coming from many countries. The Board believes the
Company is approaching a position when we can begin to take
advantage of these opportunities for the first time and I look
forward to reporting on developments in the coming year.
Additionally I'd like to express my thanks to the non-executive
members of our Board of Directors: Mr. Brent Fitzpatrick and Mr.
James Greenstreet. They have provided a solid and knowledgeable
sounding board to our team.
As always I thank you for your continued support of the Company
and hope to see many of you at the upcoming annual general
meeting.
Sincerely,
Keith Allaun
Chairman
30 June 2015
Company Statement of Comprehensive IncomE
for the year ended 31 december 2014
31 December 31 December
Note 2014 2013
GBP GBP
Revenue - -
Administrative expenses 2 (1,182,488) (404,309)
Restructuring costs 7 (1,038,026) -
Operating loss (2,220,514) (404,395)
Finance costs 3 (329,485) (274,153)
Loss before taxation (2,549,999) (678,462)
Income tax expense 4 - -
Total comprehensive loss (2,549,999) (678,462)
------------- -------------------
Loss per share (pence) 5 (0.65) (0.22)
Diluted loss per share (pence) 5 (0.65) (0.22)
Company Statement of Changes in Equity
Deferred Deferred
Share shares shares Retained
capital Share premium (4.0p) (4.5p) earnings Total
GBP GBP GBP GBP GBP GBP
Balance at 1 January
2013 2,865,344 46,030,016 781,808 389,494 (51,191,891) (1,125,229)
Transactions with
equity participants:
* Shares issued as consideration 601,725 - - - 601,725
* Shares issued to settle liabilities 15,999 - - - - 15,999
* Conversion of warrants 11 187 - - - 198
* Credit to opening reserves 56,000 56,000
* Total comprehensive loss - - - - (678,462) (678,462)
Balance at 31
December 2013 3,483,079 46,030,203 781,808 389,494 (51,814,353) (1,129,769)
Transactions with
equity participants:
Shares issues
to settle liabilities 183,319 365,459 548,778
* Shares issues to settle liabilities 115,000 288,898 403,898
* Shares issues to settle liabilities 79,567 183,553 263,120
* Shares issues to settle liabilities 4,000 4,000
* Shares issues to settle liabilities 20,000 30,000 50,000
* Total comprehensive loss (2,549,999) (2,549,999)
Balance at 31
December 2014 3,884,965 46,898,113 781,808 389,494 (54,364,352) (2,409,972)
========= ===================== ======== ======== =============== ===========
The notes numbered 1 to 16 are an integral part of the financial
information.
Company Statement of Financial Position
As at 31 December 2014
Note 2014 2013
GBP GBP
ASSETS
Non-current assets
Property, plant and equipment 6 - 114
Investments 7 - 1,038,026
Total non-current assets - 1,038,140
Current Assets
Trade and other receivables 8 5,841 169,086
Cash and cash equivalents 25 41,417
------------ ------------
Total current assets 5,866 210,503
Total assets 5,866 1,248,643
------------ ------------
LIABILITIES
Non-current liabilities
Loans 10 - -
Current liabilities
Trade and other payables 9 (234,834) (847,063)
Loans 10 (2,181,004) (1,531,349)
Total current liabilities (2,415,838) (2,378,412)
Net liabilities (2,409,972) (1,129,769)
------------ ------------
EQUITY
Share capital 11 3,884,965 3,483,079
Share premium 46,898,113 46,030,203
Deferred shares 1,171,302 1,171,302
Accumulated losses (54,364,352) (51,814,353)
Total deficit (2,409,972) (1,129,769)
------------ ------------
The financial statements of PowerHouse Energy Group Plc, Company
number 03934451, were approved by the board of Directors and
authorised for issue on 30 June 2015 and signed on its behalf
by:
Keith Allaun
Director
The notes numbered 1 to 16 are an integral part of the financial
information.
Company Statement of Cash Flows
For the year ended 31 december 2014
2014 2013
GBP GBP
Cash flows from operating activities
Loss after taxation (2,549,999) (678,462)
Adjustments for:
* Depreciation of property, plant and equipment 114 229
* Finance costs 329,485 274,153
* Waiver of loan due from subsidiary 937,682 -
* Impairment of non-current assets 1,038,026 -
Changes in working capital:
* Decrease/(Increase) in trade and other receivables 3,582 (166,776)
* (Decrease)/Increase in trade and other payables (612,229) 118,085
* Increase in loan to subsidiary (778,019) -
Net cash used in operations (1,631,358) (452,772)
----------- ---------
Cash flows from financing activities
Proceeds on issue of shares 1,224,691 (455,975)
Finance costs (329,485) (274,153)
New loans raised 1,053,556 1,148,609
Repayment of borrowings (358,794) -
Net cash flows from financing
activities 1,589,968 418,294
----------- ---------
Net (decrease)/increase in cash and
cash equivalents (41,390) 34,290
Cash and cash equivalents at
beginning of period 41,415 7,125
Cash and cash equivalents at
end of period 25 41,415
----------- ---------
The notes numbered 1 to 16 are an integral part of this
financial information.
Notes to the Company Accounts
1. accounting policies
The following accounting policies have been applied consistently
in dealing with items which are considered material in relation to
the financial information.
1.1. Basis of preparation
This financial information is for the year ended 31 December
2014 and has been prepared in accordance with International
Financial Reporting Standards ("IFRS") adopted for use by the
European Union and the Companies Act 2006. These accounting
policies and methods of computation are consistent with the prior
year.
1.2. Judgements and estimates
The preparation of financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts in the
financial statements. The areas involving a higher degree of
judgements or complexity, or areas where assumptions or estimates
are significant to the financial statements such as the impairment
of investments and going concern are disclosed within the relevant
notes.
1.3. Going concern
The Directors have considered all available information about
the future events when considering going concern. The Directors
have reviewed cash flow forecasts for 12 months following the date
of these Financial Statements.
The convertible loan obtained from Hillgrove Investments Pty
Limited (see note 10) is considered sufficient to settle
outstanding creditors, maintain the Company's reduced overheads and
other planned events for at least the next 12 months from the
signing date of these Financial Statements. In addition, the
Company is in receipt of a letter of intention of financial support
from Hillgrove Investments Pty Limited to ensure the Company
continues to meet its obligations as they fall due and to ensure it
operates as a going concern for a period of at least 12 months.
Based on this, the Directors acknowledge the uncertainties
surrounding the availability of future funding but believe it is
appropriate to continue to adopt the going concern basis of
accounting for the preparation of the annual financial
statements.
1.4. Foreign currency translation
The financial information is presented in sterling which is the
Company's functional currency.
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Monetary assets and liabilities denominated in
foreign currencies are revalued to the exchange rate at date of
settlement or at reporting dates (as appropriate). Exchange gains
and losses resulting from such revaluations are recognised in the
income statement.
Foreign exchange gains and losses are presented in the statement
of comprehensive income within 'administrative expenses'.
1.5. Revenue
Revenue represents the amounts (excluding VAT) derived from the
supply of management and administration services to the Company's
subsidiary, PowerHouse Energy, Inc. Revenue is recognised when
amounts fall due under the formalised contract.
1.6. Employee costs
The Company has no employees (2013: nil).
1.7. Operating Leases
The Company has no operating leases (2013: nil).
1.8. Finance income and expenses
Finance income and expenses are recognised as they are incurred
or as a result of financial assets or liabilities being measured at
amortised cost using the effective interest method. No finance
expenses were incurred in the production of a qualifying asset
(2013: nil).
1.9. Income tax expense
The tax expense for the period comprises current and deferred
tax.
UK corporation tax is provided at amounts expected to be paid
(or recovered) using the tax rates and laws that have been enacted
or substantively enacted by the balance sheet date.
Deferred tax is recognised in respect of all temporary
differences that have originated but not reversed at the balance
sheet date where transactions or events that result in an
obligation to pay more tax in the future or a right to pay less tax
in the future have occurred at the balance sheet date. Temporary
differences are differences between the company's taxable profits
and its results as stated in the financial statements that arise
from the inclusion of gains and losses in tax assessments in
periods different from those in which they are recognised in the
financial statements.
A net deferred tax asset is regarded as recoverable and
therefore recognised only to the extent that, on the basis of all
available evidence, it can be regarded as more likely than not that
there will be suitable taxable profits from which the future
reversal of the underlying temporary differences can be
deducted.
Deferred tax is measured at the average tax rates that are
expected to apply in the periods in which the temporary differences
are expected to reverse, based on tax rates and laws that have been
enacted or substantively enacted by the balance sheet date.
Deferred tax is measured on a non-discounted basis.
1.10. Plant, property and equipment
Plant, property and equipment is stated at cost less accumulated
depreciation. Cost represents the cost of acquisition or
construction, including the direct cost of financing the
acquisition or construction until the asset comes into use.
Depreciation on plant, property and equipment is provided to
allocate the cost less the residual value by equal instalments over
their estimated useful economic lives of 3 years.
The expected useful lives and residual values of plant, property
and equipment are reviewed on an annual basis and, if necessary,
changes in useful life or residual value are accounted for
prospectively.
1.11. Other non-current assets
Other non-current assets represent the investment in PowerHouse
Energy, Inc. The investment is carried at cost less accumulated
impairment. Cost was determined using the fair value of shares
issued to acquire the investment.
1.12. Trade and other receivables
Trade receivables are recognised at fair value. Subsequently
they are carried at their initial recognition value less any
impairment losses.
1.13. Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call
deposits and are recognised and subsequently carried at fair
value.
1.14. Trade and other payables
Trade payables are obligations to pay for goods or services that
have been acquired in the ordinary course of business from
suppliers. Trade and other payables are recognised initially at
fair value and subsequently measured at amortised cost using the
effective interest method.
1.15. Loans
Loans are financial obligations arising from funding received
and used to support the operational costs of the Company. These are
initially recognised at fair value. Loans are subsequently carried
at amortised cost using the effective interest method.
1.16. Adoption of new and revised standards
New and revised standards adopted during the year and those
standards and interpretations in issue but not yet effective are
shown in note 1.22 to the Group financial statements.
1.17. Impairment testing
Assets not subsequently carried at fair value are reviewed
periodically for indications of impairment. On recognition of an
impairment event, the book values of the assets are compared to
their recoverable amount. In the event the recoverable amount is
less that the book value, asset is reduced to the recoverable
amount and the difference recognised as an expense.
2. Administrative expenses
Included in administrative expenses are:
2014 2013
GBP GBP
Directors' fees 100,000 106,047
Depreciation 114 229
Operating leases - -
Net foreign exchange (profit)/loss (148) 2,966
Auditor's remuneration - Company's
audit 10,000 10,000
Impairment loss recognised on
loans receivable carried at amortised
cost (note 10) 937,682 -
3. Finance costs
2014 2013
GBP GBP
Other loan interest 75,159 67,000
Shareholder loan interest 254,326 207,153
329,485 274,153
------- -------
4. Income tax expense
As the Company incurred a loss, no current tax is payable (2013:
GBPnil). In addition, there is no certainty about future profits
from which accumulated tax losses could be utilised and accordingly
no deferred tax asset has been recognised. Tax losses amount to
GBP5,178,487 (2013: GBP2,709,420).
The tax charge is lower (2013: lower) than the standard rate of
tax. Differences are explained below.
2014 2013
GBP GBP
Current tax
Loss before taxation 2,549,999 678,462
Tax credit at standard UK corporation
tax rate of 21% (2013 - 23%) 535,500 156,046
Effects of:
Expenses not deductible for tax purposes (414,938) -
Deferred tax not recognised (120,562) (156,046)
Income tax expense - -
5. Loss per share
2014 2013
Total comprehensive loss (GBP) (2,549,999) (678,275)
Weighted average number of shares 376,628,030 312,273,426
Weighted average number of dilutive
shares 2,732,739 1,816,072
Loss per share in pence (0.68) (0.22)
Diluted loss per share in pence (0.68) (0.22)
6. Property, plant and equipment
Office
equipment
GBP
Opening carrying
value 114
* Depreciation (114)
----------
* Net carrying value -
The cost value of fixed assets is GBP3,202 (2013: GBP3,202 and
2012: GBP3,431).
Accumulated depreciation is GBP3,202 (2013: GBP3,088 and 2012:
GBP3,317).
7. Investments
Other non-current asset consists of the investment in PowerHouse
Energy, Inc and Pyromex AG. PowerHouse Energy, Inc. is incorporated
in California in the United States of America and the Company holds
100 per cent of the common stock and voting rights of the
subsidiary. Pyromex AG is based in Zug, Switzerland and the Company
holds 100 per cent of the shares and voting rights of the
subsidiary.
2014 2013
GBP GBP
Investment - Cost 48,947,154 48,947,154
Accumulated impairment (47,909,128) (47,909,128)
Impairment recognised in the ( 1,038,026) -
period
------------ ------------------
- 1,038,026
------------ ------------------
The cost of the Powerhouse Energy Inc investment was determined
using an issue price of 17.5 pence (the price of the Company's
shares on re-listing after the reverse takeover) for the
273,766,456 shares issued to acquire PowerHouse Energy, Inc. During
the period the investment in Pyromex AG was impaired to a nil
carrying value due to the wind down of operations that commenced
after the balance sheet date. The investment in Powerhouse Energy
Inc was already impaired to nil value at 1 January 2014.
8. Trade and other receivables
2014 2013
GBP GBP
Other receivables 5,841 9,423
Amounts due from subsidiary undertakings - 159,663
5,841 169,086
----- -------
The receivable from Pyromex AG was written off in the year due
to the wind down of operations.
9. Trade and other payables
2014 2013
GBP GBP
Trade payables 32,567 90,877
RenewMe 171,447 720,225
Other accruals 30,820 35,961
234,834 847,063
------- -------
RenewMe Limited had been granted exclusive rights by Pyromex to
use, own, assemble and install and operate Pyromex systems in
territories also licensed to the Company's subsidiary PowerHouse
Energy, Inc. The Company entered into a settlement agreement with
RenewMe whereby the parties agreed to change the respective
exclusive rights pertaining to the Pyromex technology. Under the
original settlement agreement Powerhouse Energy, Inc. had the
obligation to pay five instalments of EUR 200,000 annually
beginning 30 June 2011. The Company guaranteed the obligations
under the agreement of PowerHouse Energy, Inc. As PowerHouse
Energy, Inc is unable to meets its obligations, all remaining
amounts (EUR 800,000) due under the original settlement agreement
have been recognised as a liability.
On 3 March 2014 the Company announced that a settlement had been
reached with Renewme to release its claimed geographical licenses
to use our technology under a disputed royalty agreement with
Pyromex and other claims against the company in return for
EUR211,000 and the issue of 18,331,996 new Ordinary Shares in the
Company. While the equity portion of that settlement has been
satisfied, the cash payment has not been settled and the agreement
has not been completed. The Company is in active discussion with
Renewme to finalize an agreement.
Capital commitments not accrued for at the period end amounted
to GBP100,000 (2013: GBPnil) and related to plant and machinery
that had not yet been received.
10. Loans
2014 2013
GBP GBP
Other loan - 328,739
Shareholder loan 2,181,004 1,202,609
--------- ---------
2,181,004 1,531,348
--------- ---------
On 2 April 2014 the Company negotiated a settlement to repay the
other loan in full by way of issue and allotment for 11,500,000 1
pence shares in the Company to Aspermont Limited.
Hillgrove Investments Pty Limited ("Hillgrove") has provided the
Company with a convertible loan agreement amounting to GBP2,181,004
- which can be increased at Hillgrove's option. On 24 February 2014
the Company announced that it had entered into a debenture with
Hillgrove. The loan is secured by a debenture over the assets of
the company, and carries interest of 15 per cent per annum.
Hillgrove has the option at any time to convert the loan in part or
whole at a conversion price of 1p per share. Hillgrove have
provided a letter of support indicating they are willing to
increase the loan amount pending any unforeseeable or material
changes to the Company's current circumstances.
11. Share capital
1.0 p Ordinary 4.5 p Deferred 4.0 p Deferred
shares shares shares
Shares at 1 January
2013 286,534,426 17,373,523 9,737,353
Issue of shares
for consideration 60,172,400
* Issue of shares to settle liabilities 1,599,994 - -
* Exercise of Warrants 11 - -
Shares at 31 December
2013 348,307,926 17,373,523 9,737,353
* Issue of shares to settle liabilities 40,188,668
Shares at 31 December
2014 388,496,594 17,373,523 9,737,353
--------------------- -------------- --------------
At 31 December 2014 (GBP) 3,884,965 781,808 389,494
At 31 December 2013 (GBP) 3,483,079 781,808 389,494
12. Convertible instruments
Average Exercisable
exercise
price
Currently Within 1 to Total
Notes 1 year 5 years
Driftwood 12.4 GBP0.120 2,956,929 - - 2,956,929
2,956,929 - - 2,956,929
--------- ------- -------- ----------
12.1. Warrants
No warrants are held (2013:nil).
12.2. Hillgrove
Hillgrove has the option at any time to convert its loan of
GBP2,181,004 in part or whole at a conversion price of 1p per
share.
12.3. Driftwood
On 13 July 2011, PowerHouse Energy Group plc granted 2,956,929
options over ordinary shares to Driftwood Capital Pty Limited (as
trustee for Driftwood Capital Unit Trust) exercisable as
follows:
-- 535,500 after 1 October 2013 at an exercise price of US$0.12 (GBP0.074) per share; and
-- 2,421,429 after 1 April 2014 at an exercise price of US$0.21 (GBP0.130) per share.
12.4. Directors
On 8 December 2014, Powerhouse Energy Group plc granted
11,000,000 options over ordinary shares to the Board, under the
Powerhouse Energy Group plc Unapproved Share Option Plan 2011. The
options may be exercised between the Grant date and the tenth
anniversary of the grant date and will lapse if not exercised
during that period. No charge has been included in the Statement on
Comprehensive Income as it is not currently foreseen that the
options will vest.
The options have an exercise price of 2.5p per share.
The options were granted as follows:
Mr Keith Allaun - 5,000,000
Mr Brent Fitzpatrick - 3,000,000
Mr James Greenstreet - 3,000,000
13. Material risks
13.1. Requirement for further funds
In assessing the going concern, the Directors have reviewed cash
flow forecasts for 12 months following the date of these accounts.
The cash flow forecasts assumed no further funding of PowerHouse
Energy, Inc. and Pyromex. The financial support provided by
Hillgrove Investments Pty Limited is considered sufficient to
maintain the Company's reduced overhead and other planned events.
The Company is dependent on this continued support to cover it
operational costs.
In the event the Company requires other equity financing, or the
conversion option in the Hillgrove loan is exercised, remaining
shareholders will be diluted.
14. Directors' Remuneration
The Directors who held office at 31 December 2014 had the
following interests, including any interests of a connected person
in the ordinary shares of the Company:
Number of ordinary
shares of 1.0p Percentage of
each voting rights
----------------------- ------------------ --------------
Nigel Brent Fitzpatrick 103,459 <0.1
The remuneration of the Directors of the Company paid for the
year or since date of appointment, if later, to 31 December 2014
is:
2014 2014 2014 2014 2013
GBP GBP GBP GBP GBP
Salary/Fee Pension Benefits Total Total
------------------------ ----------- -------- --------- ------- -------
Nigel Brent Fitzpatrick - - - - -
James John Pryn -
Greenstreet - - - -
Robert Keith Allaun 100,000 - - 100,000 106,047
Service contracts
Brent Fitzpatrick and James Greenstreet have service contracts
which can be terminated by providing three months' written
notice.
15. Related Parties
Hillgrove Investments Pty Limited is a related party by virtue
of it's shareholding in the Company.
During the year Hillgrove Investments Pty Limited loaned the
company a further GBP724,069 and charged GBP254,326 interest. The
balance outstanding at the year end was GBP2,181,004 (2013:
GBP1,202,609).
Other transactions with other related parties were conducted on
an arms' length basis and totalled GBP15,074 (2013; GBPnil).
Consolidated Statement of Comprehensive Income
For the year ended 31 december 2014
Note Year ended Year ended
31 December 31 December
2014 2013
US$ US$
Revenue - 3,330
Cost of sales - (46,825)
Gross loss - (43,495)
Administrative expenses 2 (4,517,504) (614,132)
Operating loss (4,517,504) (657,627)
Finance income - 1
Finance expenses 4 (530,471) (386,556)
Loss before taxation (5,047,975) (1,044,182)
Income tax credit 5 - -
Loss after taxation (5,047,975) (1,044,182)
Foreign exchange arising on
consolidation 142,995 (160,183)
Total comprehensive loss (4,904,980) (1,204,365)
------------ ------------
Total comprehensive loss attributable
to:
Owners of the Company (4,904,980) (1,204,365)
Non-controlling interests - -
------------ ------------
Loss per share (US$) 6 <(0.01) <(0.01)
The notes numbered 1 to 16 are an integral part of the financial
information.
Consolidated Statement of Changes in Equity
Shares Accumulated Other Non-control-ling
and stock losses reserves interests Total
US$ US$ US$ US$ US$
---------- ------------ ------------ ---------------- -----------
Balance at 1
January 2013 80,162,619 (19,697,145) (62,767,508) - (2,302,034)
Transactions
with equity participants:
* Shares issued to settle liabilities 998,864 - - - 998,864
* Shares issues to settle liabilities 26,558 - - - 26,558
* Conversion of warrants 18 - 310 - 328
-
* Total comprehensive income:
* Loss after taxation - (1,204,365) - - (1,204,365)
* Foreign exchange included in profit and loss arising
from loss of control - - 1,095,440 - 1,095,440
* Foreign exchange arising on consolidation - (160,183) - (160,183)
Balance at 31
December 2013 81,188,059 (20,901,510) (62,927,381) - (2,640,832)
Transactions
with equity participants:
* Shares issued to settle liabilities 285,978 - 570,116 - 856,094
* Shares issues to settle liabilities 179,400 - 450,681 - 630,081
* Shares issued to settle liabilities 124,125 - 286,343 - 410,468
* Shares issues to settle liabilities 6,240 - - - 6,240
* Shares issued to settle liabilities 31,200 - 46,800 - 78,000
Total comprehensive
income:
* Loss after taxation -(1,204,365) --(1,204,365) (4,904,980) (4,904,980)
* Foreign exchange arising on consolidation - 142,195 - 142,195
---------- ------------ ------------ ---------------- -----------
Balance at 31
December 2014 81,815,002 (25,806,490) (61,431,246) - (5,422,734)
---------- ------------ ------------ ---------------- -----------
The notes numbered 1 to 16 are an integral part of the financial
information.
Consolidated Statement of Financial Position
As at 31 December 2014
Note 31 December 31
2014 December
US$ 2013
US$
ASSETS
Non-current assets
Intangible assets 7 - 2,087,081
Property, plant and equipment 8 2,455 665,160
Total non-current assets 2,455 2,752,241
Current Assets
Trade and other receivables 10 43,846 54,311
Cash and cash equivalents 11 816 69,617
------------ ------------
Total current assets 44,662 123,928
Total assets 47,117 2,876,169
LIABILITIES
Non-current liabilities
Loans 13 - -
Total non-current liabilities - -
Current liabilities
Loans 13 (3,402,366) (2,542,038)
Trade and other payables 14 (2,067,485) (2,974,963)
Total current liabilities (5,469,851) (5,517,001)
Total liabilities (5,469,851) (5,517,001)
Net liabilities (5,422,734) (2,640,832)
------------ ------------
EQUITY
Shares and stocks 81,815,002 81,188,059
Other reserves (61,431,246) (62,927,381)
Accumulated losses (25,806,490) (20,901,510)
Non-controlling interests - -
Total deficit (5,422,734) (2,640,832)
------------ ------------
The financial statements were approved by the board of Directors
and authorised for issue on 30 June 2015 and signed on its behalf
by:
Keith Allaun
Director
The notes numbered 1 to 16 are an integral part of the financial
information.
Consolidated Statement of Cash Flows
For the year ended 31 december 2014
Note Year ended Year ended
31 December 31 December
2014 2013
US$ US$
Cash flows from operating activities
Loss before taxation (4,904,980) (1,204,365)
Adjustments for:
* Finance income - (1)
* Finance costs 530,471 386,556
* Impairment of non-current assets 2,087,081 -
* Depreciation and amortisation 662,705 322
* Foreign exchange revaluations 142,195 (160,183)
Changes in working capital:
* Decrease/ (Increase) in trade and other receivables 10,465 (50,251)
* (Decrease)/ Increase in trade and other payables (907,478) 1,371,489
- -
* Taxation paid
Net cash used in operations (2,379,542) 343,567
------------ ------------
Cash flows from investing activities
Disposal (purchase) of tangible - -
and intangible assets
Net cash flows used in investing - -
activities
------------ ------------
Cash flows from financing activities
Common stock issue (net of issue
costs) 1,980,883 (756,919)
Finance income - 1
Finance costs (530,471) (386,556)
Loans received/(repaid) 862,484 864,202
Net cash flows from financing
activities 2,312,896 (282,272)
------------ ------------
Net (decrease) / increase in cash
and cash equivalents (66,646) 61,295
Cash and cash equivalents at
beginning of period 69,617 11,492
Foreign exchange on cash balances (2,155) (3,170)
Cash and cash equivalents at
end of period 816 69,617
------------ ------------
The notes numbered 1 to 16 are an integral part of the financial
information.
Notes to the Consolidated Accounts
1. accounting policies
The following accounting policies have been applied consistently
in dealing with items which are considered material in relation to
the Group financial information.
1.1. Basis of preparation
This consolidated financial information is for the year ended 31
December 2014 and has been prepared in accordance with
International Financial Reporting Standards ("IFRS") adopted for
use by the European Union and the Companies Act 2006. These
accounting policies and methods of computation are consistent with
those used in prior years.
1.2. Consolidation and goodwill
Pyromex acquisition
On 8 August 2013, the Company acquired the remaining 70%
interest in Pyromex. Pyromex is accounted as a wholly owned
subsidiary of the Group. The original 30 per cent was held as an
investment which had been impaired to nil due to the uncertainties
surrounding the technology.
During the period the remaining 70% investment in Pyromex AG was
impaired to a nil carrying value due to the wind down of operations
that commenced after the balance sheet date.
1.3. Judgements and estimates
The preparation of financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts in the
financial statements. The areas involving a higher degree of
judgements or complexity, or areas where assumptions or estimates
are significant to the financial statements such as the impairment
of assets and going concern are disclosed with the notes
1.4. Foreign currency translation
The financial information is presented in US dollars which is
the Group's functional currency.
1.4.1. Transactions and balances in foreign currency
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Monetary assets and liabilities denominated in
foreign currencies are revalued to the exchange rate at date of
settlement or at reporting dates (as appropriate). Exchange gains
and losses resulting from such revaluations are recognised in the
Statement of Comprehensive Income.
Foreign exchange gains and losses are presented in the income
statement within 'administration expenses'.
1.4.2. Consolidation
The results and financial position of Group entities with a
different functional currency to the presentation currency are
translated into the presentation currency as follows:
-- Assets and liabilities are translated at the closing rate of 31 December 2014;
-- Income and expenses for each income statement are translated
at average exchange rates over the period of consolidation; and
-- the resulting exchange differences are recognised in other comprehensive income.
The principal rates used for translation are: 2014 2014
Closing Average
British Pounds 1.5586 1.6075
Swiss Francs 1.0072 1.0658
1.5. Going concern
The Directors have considered all available information about
the future events when considering going concern. The Directors
have reviewed cash flow forecasts for 12 months following the date
of these Financial Statements.
The convertible loan obtained from Hillgrove Investments Pty
Limited (see note 10) is considered sufficient to settle
outstanding creditors, maintain the Company's reduced overheads and
other planned events for at least the next 12 months from the
signing date of these Financial Statements. In addition, the
Company is in receipt of a letter of intention of financial support
from Hillgrove Investments Pty Limited to ensure the Company
continues to meet its obligations as they fall due and to ensure it
operates as a going concern for a period of at least 12 months.
Based on this, the Directors acknowledge the uncertainties
surrounding the availability of future funding but believe it is
appropriate to continue to adopt the going concern basis of
accounting for the preparation of the annual financial
statements.
1.6. Revenue
Revenue represents the amounts (excluding sales tax) derived
from sales of power generation plus associated services.
Revenue from the sale of goods is recognised when the risk and
rewards associated with the goods has been transferred to the
purchaser. Revenue from services is recognised over the period of
performance of the services.
1.7. Employee costs
The group has no employees (2013: nil).
1.8. Operating Leases
The Group has no operating leases (2013: nil).
1.9. Finance income and expenses
Finance income and expenses are recognised as they are incurred
or as a result of financial assets or liabilities being measured at
amortised cost using the effective interest method. No finance
expenses were incurred in the production of a qualifying asset.
1.10. Income tax expense
The tax expense for the period comprises current and deferred
tax.
UK corporation tax is provided at amounts expected to be paid
(or recovered) using the tax rates and laws that have been enacted
or substantively enacted by the balance sheet date.
Deferred tax is recognised in respect of all temporary
differences that have originated but not reversed at the balance
sheet date where transactions or events that result in an
obligation to pay more tax in the future or a right to pay less tax
in the future have occurred at the balance sheet date. Temporary
differences are differences between the company's taxable profits
and its results as stated in the financial statements that arise
from the inclusion of gains and losses in tax assessments in
periods different from those in which they are recognised in the
financial statements.
A net deferred tax asset is regarded as recoverable and
therefore recognised only to the extent that, on the basis of all
available evidence, it can be regarded as more likely than not that
there will be suitable taxable profits from which the future
reversal of the underlying timing differences can be deducted.
Deferred tax is measured at the average tax rates that are
expected to apply in the periods in which the temporary differences
are expected to reverse, based on tax rates and laws that have been
enacted or substantively enacted by the balance sheet date.
Deferred tax is measured on a non-discounted basis.
1.11. Goodwill
Goodwill arose on the acquisition of Pyromex and represents the
excess of the consideration transferred over the fair value of the
net identifiable assets, liabilities and contingent liabilities
acquired. Goodwill is stated at cost less any impairment losses
recognised.
1.12. Intangible assets
Intangible assets arose on the acquisition of Pyromex and
include trademarks and intellectual property related to the Pyromex
technology. These were recognised at fair value at the acquisition
date and are carried at cost less accumulated amortisation and
impairment. Amortisation is calculated using the straight-line
method to allocate the fair value of the intangible assets over
their estimated useful lives of 3 years. During the period the
investment in Pyromex AG was impaired to a nil carrying value due
to the wind down of operations that commenced after the balance
sheet date.
1.13. Property, plant and equipment
Plant, property and equipment are stated at cost less
accumulated depreciation. Cost represents the cost of acquisition
or construction, including the direct cost of financing the
acquisition or construction until the asset comes into use.
Depreciation on plant, property and equipment is provided to
allocate the cost less the residual value by equal instalments over
their estimated useful economic lives of 3 to 7 years.
An item of plant, property and equipment is derecognised upon
disposal or when no future economic benefits are expected to arise
from the continued use of the asset. Any gain or loss is included
in the Statement of Comprehensive Income.
1.14. Inventories
Inventories are stated at the lower of cost and net realisable
value. The cost of finished goods and work in progress comprises
design costs, raw materials, direct labour, other direct costs and
related production overheads. It excludes borrowing costs.
1.15. Trade and other receivables
Trade receivables are recognised at fair value. Subsequently
they are carried at their initial recognition value less any
impairment losses.
1.16. Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call
deposits.
1.17. Deferred taxation
Deferred tax is recognised without discounting, in respect of
all timing differences between the treatment of certain items for
taxation and accounting purposes which have arisen but not reversed
by the balance sheet date except as otherwise required by IAS
12.
A deferred tax asset is recognised where, having regard to all
available evidence, it can be regarded as more likely than not that
there will be suitable taxable profits from which the future
reversal of the underlying timing differences can be deducted.
Deferred income tax is recognised on temporary differences
arising between the tax bases of assets and liabilities and their
carrying amounts in these financial statements.
Deferred tax assets or liabilities are not recognised if they
arise from the initial recognition of goodwill or from initial
recognition of an asset or liability that at the time of the
transaction affects neither accounting nor taxable profit nor loss.
Except, however, where an asset or a liability is initially
recognised from a business combination a deferred tax asset or
liability is recognised as appropriate.
Deferred income 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
income tax asset is realised or the deferred income tax liability
is settled.
Deferred income tax assets are recognised only to the extent
that it is probable that future taxable profit will be available
against which the temporary differences can be utilised.
1.18. Loans
Loans are financial obligations arising from funding received
from financiers and the founding stockholders. These were
recognised at fair value, net of any transaction costs incurred.
Loans are subsequently carried at amortised cost using the
effective interest method.
1.19. Trade and other payables
Trade payables are obligations to pay for goods or services that
have been acquired in the ordinary course of business from
suppliers. Trade payables and other payables are recognised
initially at fair value and subsequently measured at amortised cost
using the effective interest method.
1.20. Share capital and share premium
Proceeds from the issue of common stock or ordinary and deferred
shares have been classified as equity. Costs directly attributable
to the issue of these equity instruments are shown as a deduction,
net of tax, from the proceeds.
1.21. Share based payments
The Group has used share-based compensation, whereby the Group
receives services from employees or service providers in exchange
for consideration for options in the share capital or shares of the
Group. The fair value of the services received in exchange for the
grant of the options is recognised as an expense. The total amount
to be expensed is determined by reference to the fair value of the
services received, unless that fair value cannot be reliably
measured, in which case the fair value of the of the stock and
shares issued is used.
Non-market performance and service conditions are included in
assumptions about the number of options that are expected to vest.
The total expense is recognised over the vesting period, which is
the period over which all of the specified vesting conditions are
to be satisfied.
1.22. Adoption of new and revised standards
There have been no standards or interpretations that have been
adopted that have affected the amounts reported in these financial
statements. As at the date of approval of the financial
information, the following standards and interpretations were in
issue but not yet effective:
IFRS 9 Financial Instruments
IFRS 10 (amended) Consolidated Financial Statements
IFRS 11 (amended) Joint Arrangements
IFRS 12 (amended) Disclosure of Interests in Other Entities
IFRS 14 Regulatory Deferral Accounts
IFRS 15 Revenue from Contracts with Customers
IAS 1 (amended) Presentation of Items of Other Comprehensive Income
IAS 16 (amended) Property, Plant and Equipment
IAS 19 (revised) Employee Benefits
IAS 27 (amended) Separate Financial Statements
IAS 28 (amended) Investments in Associates and Joint Ventures
IAS 38 (amended) Intangible assets
In addition, there are certain requirements of Improvements to
IFRSs which are not yet effective.
The Directors are still assessing the impact of the adoption of
these standards on the Group's results but do not anticipate that
there will be a material impact on the Group's results.
2. Administrative expenses
Included in administrative expenses are;
2014 2013
US$ US$
Employee expenses - 29,594
Impairment of Goodwill 1,874,735 -
Depreciation and amortisation 595,159 322
Professional fees - 149,702
--------- -------
At 31 December 2014, the Group had no employees (2013: nil).
3. Employee benefits
2014 2013
US$ US$
Wages and salaries - 29,594
Total employee benefits - 29,594
---- ------
4. Finance expenses
2014 2013
US$ US$
Shareholder loan interest 409,465 292,083
Other loan interest 121,006 94,470
Total finance expenses 530,471 386,556
------- -------
5. Income tax credit
2014 2013
US$ US$
Current taxation - -
Deferred taxation - -
Total taxation credit - -
---- ----
The tax charge is lower (2013: lower) than the standard rate of
tax. Differences are explained below.
2014 2013
US $ US $
Current tax
Loss before taxation 5,047,975 1,044,182
Tax credit at standard UK corporation
tax rate of 21% (2013 - 23%) 1,060,075 240,161
Effects of:
Expenses not deductible for tax purposes (646,661) -
Deferred tax not recognised (413,414) (240,161)
Income tax expense - -
6. Loss per share
2014 2013
Loss after taxation-attributable
to owners of the Company (US$) (4,904,980) (1,204,365)
Weighted average number of shares 285,425,948 285,425,948
Loss per share (US$) <(0.01) <(0.01)
As the Group incurred a loss, potential ordinary shares are
anti-dilutive and accordingly no diluted earnings per share has
been presented.
7. Intangible assets
Pyromex Licence
Goodwill technology agreements Total
----------- ----------- ----------- -------------
At 1 January 2013
Cost 4,035,356 2,087,081 990,840 7,113,277
Accumulated amortisation
and impairment (4,035,356) - (990,840) (5,026,196)
----------- ----------- ----------- -----------
Net carrying value - 2,087,081 - 2,087,081
- - - -
Closing carrying value
At 31 December 2013
Cost 4,035,356 2,087,081 990,840 7,113,277
Accumulated amortisation
and impairment (4,035,356) - (990,840) (5,026,196)
----------- ----------- ----------- -----------
At 1 January 2014 - 2,087,081 - 2,087,081
Net carrying value - - - -
Impairment recognised
in period - (1,874,735) - (1,874,735)
Pyromex acquisition - - - -
Foreign exchange fluctuations - (212,346) - (212,346)
----------- ----------- ----------- -----------
- - - -
Closing carrying value
At 31 December 2014
Cost - - - -
Accumulated amortisation
and impairment - - - -
----------- ----------- ----------- -----------
- - - -
----------- ----------- ----------- -----------
Goodwill was recognised as the excess of the fair value of the
consideration determined in accordance with IFRS 3 accounting for
reverse acquisitions over the fair value of the net liabilities
acquired. Following the decision to wind down the Pyromex operation
as discussed in the Directors' Report, the Goodwill has been
impaired to a carrying value of nil.
Licence agreements represented the capitalised licence fees paid
by PowerHouse Energy, Inc. to Pyromex and RenewMe for rights
associated with the Pyromex technology.
8. Property, plant and equipment
Pyromex Office
equipment equipment Total
----------- ------------------- -----------
At 1 January 2013
Cost 662,272 45,926 6,995,788
Accumulated depreciation - (9,566) (5,170,152)
----------- ------------------- -----------
Opening carrying value 662,272 36,360 1,825,636
-
* Depreciation - (6,628) (6,628)
* Pyromex loss of control (1,842,079) (26,965) (1,869,044)
* Closing carrying value - 957 (1,925,708)
At 31 December 2013
Cost 662,272 2,888 665,160
Accumulated depreciation - - -
----------- ------------------- -----------
Net carrying value - 2,888 665,160
Depreciation (594,726) (433) (595,159)
Foreign exchange fluctuations (67,546) - (67,546)
At 31 December 2014 - 2,455 2,455
----------- ------------------- -----------
9. Inventories
The Group has no inventories (2013: nil).
10. Trade and other receivables
2014 2013
US$ US$
Other receivables 34,734 33,526
VAT receivable 9,112 20,785
Total trade and other receivables 43,846 54,311
------ ------
11. Cash and cash equivalents
Cash and cash equivalents consist solely of cash balances in
bank accounts.
12. Deferred taxation
Deferred income tax assets are recognised for tax loss
carry-forwards to the extent that the realisation of the related
tax benefit through future taxable profits is probable. The Group
did not recognise deferred income tax assets in respect of
losses.
13. Loans
Notes 2014 2013
US$ US$
Other loan 13.1 - 550,036
Shareholder loan 13.2 3,402,366 1,992,002
Total loans 3,402,366 2,542,038
--------- ---------
Classified as:
* Current 3,402,366 2,542,038
- -
* Non-current
13.1. Other loan
On 2 April 2014 the Company negotiated a settlement to repay the
Aspermont loan in full by way of issue and allotment for 11,500,000
1 pence shares in the Company.
13.2. Shareholder Loan
Hillgrove Investments Pty Limited ("Hillgrove") has provided the
PowerHouse Energy Group plc with a convertible loan agreement
amounting to $3,402,366 - which can be increased at Hillgrove's
option. The loan is secured by a debenture over the assets of the
company, repayable on 8 October 2014 and carries interest of 15 per
cent per annum.
Hillgrove have provided a letter of support indicating they are
willing to increase the loan amount pending any unforeseeable or
material changes to the Group's current circumstances.
14. Trade and other payables
2014 2013
US$ US$
Trade creditors 1,701,144 1,445,921
RenewMe 316,721 1,155,966
Other accruals 49,620 373,073
Total trade and other payables 2,067,485 2,974,963
--------- ---------
14. Trade and other payables (continued)
Trade and other payables are classified as:
* Current 2,067,485 2,974,963
- -
* Non-current
14.1. RenewMe
RenewMe Limited had been granted exclusive rights by Pyromex to
use, own, assemble and install and operate Pyromex systems in
territories also licensed to the Group's subsidiary PowerHouse
Energy, Inc. The Group entered into a settlement agreement with
RenewMe whereby the parties agreed to change the respective
exclusive rights pertaining to the Pyromex technology. Under the
original settlement agreement Powerhouse Energy, Inc. had the
obligation to pay five instalments of EUR 200,000 annually
beginning 30 June 2011. The Group guaranteed the obligations under
the agreement of PowerHouse Energy, Inc. As PowerHouse Energy, Inc
is unable to meets its obligations, all remaining amounts (EUR
800,000) due under the original settlement agreement have been
recognised as a liability.
On 3 March 2014 the Group announced that a settlement had been
reached with Renewme to release its claimed geographical licenses
to use our technology under a disputed royalty agreement with
Pyromex and other claims against the company in return for
EUR211,000 and the issue of 18,331,996 new Ordinary Shares in the
Group. While the equity portion of that settlement has been
satisfied, the cash payment has not been settled and the agreement
has not been completed. The Group is in active discussion with
Renewme to finalize an agreement.
Capital commitments not accrued for at the period end amounted
to GBP100,000 (2013: GBPnil) and related to plant and machinery
that had not yet been received.
15. Seasonality
The Group's business is not subject to any consistent seasonal
fluctuations.
16. Directors' Remuneration and share interests
The Directors who held office at 31 December 2014 had the
following interests, including any interests of a connected person
in the ordinary shares of the Company:
Number of ordinary
shares of 1.0p Percentage of
each voting rights
----------------------- ------------------ --------------
Nigel Brent Fitzpatrick 103,459 <0.1
The remuneration of the Directors of the Company paid for the
year or since date of appointment, if later, to 31 December 2013
is:
2014 2014 2014 2014 2013
$ $ $ $ $
Salary/Fee Pension Benefits Total Total
------------------------ ----------- -------- --------- ------- -------
Nigel Brent Fitzpatrick - - - - -
James John Pryn -
Greenstreet - - - -
Robert Keith Allaun 161,000 - - 161,000 161,000
Service contracts
Brent Fitzpatrick and James Greenstreet have service contracts
which can be terminated by providing three months' written
notice.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SDSSUSFISELM
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