Interim Results
28 Settembre 2007 - 4:45PM
UK Regulatory
RNS Number:7603E
Cue Energy Plc
28 September 2007
28 September 2007
Cue Energy plc ("Cue" or "the Company")
Interim Results
Cue Energy plc, announces its results for the six months ended 30 June 2007.
Overview
* Opportunity to acquire advanced micro fuel cell technology for
commercialisation
* Technology developed by CSIRO, Australia's leading technology research
organisation
* Seven years development and #12 million investment by CSIRO
* Highly skilled technical team and continued access to CSIRO's
facilities
Chairman's Statement
It is with pleasure that I provide you with an update on the work that has been
going on behind the scenes at Cue.
On 3 January 2007 the Company announced it had entered into an agreement with
Oreion Australia Energy Pty Ltd ("Oreion") to provide funding for the
commercialisation of an advanced micro fuel cell technology developed by CSIRO,
the Australian governments leading technology research organisation. CSIRO has
invested over seven years and #12 million in this technology.
Under this agreement, Cue would make available up to #500,000 for Oreion to
advance this technology, file patents and to commence its commercialisation. At
30 June 2007 Oreion had drawn down #200,000 whilst preparing for a further
capital raising aimed at commercialising this technology.
Cue has conducted a detailed review of the technology via an independent
technical assessment and the Directors believe that it has identified a
significant commercial opportunity.
Accordingly, Cue has further produced a business plan for the development of
this fuel cell technology which the Directors believe has the potential to
provide a real alternative to lithium-ion batteries for the powering of portable
electronic devices, such as mobile phones and laptops
In the laptop market alone, power demand and functionality is outstripping the
capabilities of lithium-ion batteries and it is believed that fuel cells will
provide this continuous power requirement. Frost & Sullivan predict that by
2012 consumer demand will exceed 80 million fuel-cell units in battery
replacement and that this will be preceded by billions of dollars of government
and commercial spending on fuel cell technology development.
The Directors believe that the Company can advance this technology to provide a
commercial solution to the power capacity and life expectancy constraints that
apply to current battery technology and that this technology will be
sub-licensed to a number of key strategic partners in both the battery and in
the portable electronic devices industries.
Whilst the fuel cell technology is being commercialised the business plan
envisages early revenue to be generated from the sale of fuel cell test
stations, already near commercialisation, that CSIRO has developed for its own
use. The market for these products will be existing fuel cell developers.
The Directors are also planning to develop derivative products from this
technology. One such product is a portable electrolyser-based oxygen generator
for medical uses at home and in remote areas such as field hospitals.
Approximately 750,000 people in the USA alone require permanent oxygen therapy
and the World Health Organisation estimates that 600 million people suffer from
chronic obstructive pulmonary disease and emphysema requiring oxygen supply.
The current options for these people is limited to bottled oxygen, which is
bulky, and needs regular changing or oxygen "concentrators", which are noisy and
bulky.
The Directors have also identified a first class management team that will lead
the existing CSIRO technical team to achieve the commercial objectives developed
in the business plan. It is proposed that Cue would second from CSIRO its highly
experienced technical team to continue the technology development and will
continue to have access to CSIRO's extensive facilities, specialised equipment
and expertise.
It has been agreed in principle that, subject to appropriate funding being put
in place, Cue will acquire its interest in CSIRO's PEM technology through the
acquisition of 100% of the issued capital of Oreion. Completion of the proposed
acquisition is conditional on, amongst other things, completion of satisfactory
due diligence by Cue and approval by Cue shareholders.
The proposed acquisition would be classified as a reverse takeover under the AIM
Rules. Discussions are continuing, with financing being achieved through an
equity issue in excess of the current market capitalisation of the Company. As
mentioned in the results below, Cue has made a significant investment during the
period on the legal, technical and commercialisation costs of this project which
is indicative of the confidence which the Directors have in it.
Your Directors believe that the acquisition of Oreion represents an excellent
opportunity for the Company's shareholders to participate in the growth of the
fuel cell industry and to deliver attractive financial returns.
Results
During the six months to 30 June 2007, the Company received investment income of
#40,950 and incurred administrative expense of #219,023 resulting in a loss of
#178,074.
At 30 June 2007 the Company had provided #200,000 to Oreion under the finance
facility agreement dated 3 January 2007 and incurred #462,729 for Oreion
acquisition costs which includes due diligence work carried out. The total
amount invested in the project as at 30 June 2007 was therefore #662,729 which
has been carried forward in the balance sheet.
I would take this opportunity to thank the members of the Board for their
efforts during the year, and your support as shareholders.
Martin Thomas
Chairman
28 September 2007
INCOME STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2007
6 months to 6 months to Year ended
30 Jun 2007 30 Jun 2006 31 Dec 2006
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Administrative expenses (219) - (253)
Operating loss (219) - (253)
Interest receivable 41 - 28
Loss on ordinary activities before (178) - (225)
taxation
Taxation on loss on ordinary activities - - -
Loss for the financial year (178) - (225)
Basic loss per share (pence) (Note 3) (0.08)p (0.00)p (0.22)p
BALANCE SHEET
FOR THE PERIOD ENDED 30 JUNE 2007
6 months to 6 months to Year ended
30 Jun 2007 30 Jun 2006 31 Dec 2006
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
ASSETS
Non-current assets
Tangible assets 3 - 3
3 - 3
Current assets
Cash 1,994 193 2,831
Prepayments - Oreion Acquisition (Note 4) 463 - -
Other receivables 298 2 44
2,755 195 2,875
LIABILITIES
Current Liabilities
Other payables 70 - 12
Net current assets 2,685 195 2,863
NET ASSETS 2,688 195 2,866
Shareholders' equity
Called up share capital 161 56 161
Share premium account 2,755 139 2,755
Other reserves 176 - 176
Retained loss (404) - (226)
Total Equity 2,688 195 2,866
CASH FLOW STATEMENT
FOR THE PERIOD ENDED 30 JUNE 2007
6 months to 6 months to Year ended
30 Jun 2007 30 Jun 2006 31 Dec 2006
(unaudited) (unaudited) (audited)
#'000 #'000 #'000
Net cash used in operating activities (175) (2) (209)
Prepayment - Oreion Acquisition (462) - -
Payment to acquire tangible assets - - (4)
Net cash used in investing activities (462) - (4)
Finance Facility costs (note 5) (200) - -
Proceeds from Issue of share - 195 3,206
Share issue costs - - (289)
Share based payments - - 127
Net cash inflow from financing (200) 195 3,044
Increase/(decrease) in cash (837) 193 2,831
Cash and cash equivalents at beginning of 2,831 - -
the period/year
Cash and cash equivalents at end of the 1,994 193 2,831
period/year
STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 30 JUNE 2007
Called up Share Other Retained Loss Total
share capital premium Reserves Shareholders
Equity
#'000 #'000 #'000 #'000 #'000
As at 1 January 2007 161 2,755 176 (226) 2,866
Shares issued during the period - - - - -
Share issue expense - - - - -
Equity-settled share-based payments - - - - -
Equity-settled share issue expenses - - - - -
Loss for the period - - - (178) (178)
Balance as at 30 June 2007 161 2,775 176 (404) 2,688
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 30 JUNE 2007
1. Financial Information
The financial information set out above does not constitute statutory
accounts within the meaning of Section 240 of the Companies Act 1985. It has
been prepared on a going concern basis in accordance with International
Financial Reporting Standards (IFRS). The accounting policies applied in
preparing the financial information are consistent with those that have been
adopted in the Company's 2006 statutory accounts.
The financial information for the 6 months ended 30 June 2007 and the 6
months ended 30 June 2006 has not been audited.
2. Basis of Preparation
This financial information has been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by the European
Union (EU), IFRIC interpretations and the Companies Act 1985 applicable to
companies reporting under IFRS. The financial information has been prepared
under historical cost convention.
The preparation of this financial information in conformity with generally
accepted accounting principles requires the use of estimates and assumptions
that affect the reported amounts of assets and liabilities at the date of the
financial information and the reported amounts of revenues and expenses during
the reporting period. Although these estimates are based on management's best
knowledge of the amount, event or actions, actual results ultimately may differ
from those estimates.
3. Earnings per share
The calculation of loss per share is based on a retained loss of #178,074
for the period ended 30 June 2007 (30 June 2006: nil; 31 December 2006:
#225,682) and the weighted average number of shares in issue in the period 30
June 2007 of 230,207,901 (30 June 2006: 4,351,136; 31 December 2006:
104,645,967). There is no difference between the diluted loss per share and the
loss per share shown.
4. Prepayments - Oreion Acquisition
The direct costs incurred in relation to the Oreion Australia Energy Pty Ltd
acquisition at 30 June 2007 was #462,729.
5. Finance Facility
Cue Energy plc has entered into an agreement with Oreion Australia Energy Pty
Ltd ("Oreion") whereby up to a maximum of #500,000 has been made available to
Oreion as part of a working capital facility. Interest is payable @ 9.1% on the
outstanding balances. During the six months ended 30 June 2007 Oreion had drawn
down #200,000.
6. Called Up Share Capital
The authorised share capital of the Company and the called up and fully paid
amounts at 30 June 2007 follows:
#'000
Authorised
20,000,000,000 ordinary shares of 0.7p each 14,000,000
Issued and fully paid
230,207,901 ordinary shares of 0.7p each 161,146
7. Share options and warrants
The following equity instruments have been issued by the Company and have not
been exercised at 30 June 2007:
Number of ordinary Exercise
shares
Price Expires
Incentive options 5,755,199 2 pence 2 August 2011
**ENDS**
For further information please visit www.cueenergyplc.com or contact the
following:
Jade Styants/Toby Howell Cue Energy plc Tel: +44 (0)20 7182 1748
Edward Hutton/Rachel Kane HB Corporate Tel: +44 (0)20 7510 8600
Hugo de Salis/Isabel Crossley St Brides Media & Finance Tel: +44 (0) 20 7242 4477
This information is provided by RNS
The company news service from the London Stock Exchange
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