Full Year Statutory Accounts
Sydney, Oct 3, 2016 AEST (ABN Newswire) - Atrum Coal NL (
ASX:ATU) (ATRCF:OTCMKTS) directors present their report on the consolidated entity consisting of Atrum Coal NL and the entities it controlled at the end of, or during, the year ended 30 June 2016. Throughout the report, the consolidated entity is referred to as the group.
OPERATING AND FINANCIAL REVIEW
Review of Operations
A review of operations for the year, and the results of those operations is contained within the company review.
Operating Results
Consolidated loss after income tax for the year was $11,745,289 (2015: $19,206,333).
Financial Position
At 30 June 2016, the Group had cash reserves of $1,871,124 (2015: $253,058).
Additionally, pursuant to an Offset Loan Agreement with Lenark Pty Ltd, a related entity of non-executive director, Mr. James Chisholm, the Company has, subject to the approval of any cash calls by Lenark, a facility with a limit of $845,153.
Financing and Investing Activities
On 24 August 2015, 9,847,258 fully paid ordinary shares were issued under an Entitlement Offer.
On 8 September 2015, 200,000 fully paid ordinary shares and 1,150,000 options were issued as a fee for restructuring the Anglo Pacific Promissory Note.
On 11 September 2015, 6,162,743 fully paid ordinary shares were issued under a placement following the entitlement offer.
On 29 December 2015 1,000,000 options were issued as a fee for restructuring the Anglo Pacific Promissory Note.
On 30 December 2015, 200,000 fully paid ordinary shares were issued following hurdles being met on performance rights.
On 3 February 2016, 150,000 fully paid ordinary shares were issued following exercise of options.
On 23 March 2016, 340,000 fully paid ordinary shares were issued following conversion of convertible notes.
On 1 April 2016, 200,000 fully paid ordinary shares were issued as a fee for restructuring the Anglo Pacific Promissory Note.
On 23 March 2016, 3,184,786 and 3,524,786 fully paid ordinary shares were issued following conversion of convertible notes.
On 6 May 2016, 980,000 fully paid ordinary shares and 980,000 options were issued following conversion of convertible notes.
On 13 May 2016, 3,694,000 fully paid ordinary shares and 3,694,000 options were issued following conversion of convertible notes.
Dividends
No dividends were paid during the year and no recommendation is made as to dividends.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
Significant changes in the state of affairs of the Group during the year are detailed in the Company review.
Other than as disclosed, there has been no matter or circumstance that has arisen that has significantly affected, or may significantly affect:
1. the Group's operations in future financial years, or
2. the results of those operations in future financial years, or
3. the Group's state of affairs in future financial years.
In the opinion of the directors, there were no other significant changes in the state of affairs of the Company that occurred during the period under review not otherwise disclosed in this report or in the financial report.
EVENTS SINCE THE END OF THE FINANCIAL YEAR
On 30 July 2016, Atrum Coal NL entered into a binding agreement relating to the proposed acquisition of a 26.68% interest in Atlantic Carbon Group PLC (incorporated in England and Wales) (ACG).
Atrum is intending to complete the acquisition of the interest in ACG ('Acquisition') shareholder approval was gained at an Extra-Ordinary General Meeting (EGM) on 29 September 2016.
Key Acquisition Terms
The binding agreement for the Acquisition has been entered into with Stephen Best (the current CEO of ACG) and persons and entities connected with Stephen Best, including Mayford Equities Limited, Mary Best, Willoughby (465) Limited, Lucy Best, Helen Frankland, Penn Carb Inc and Mount Charles (Mayfair) Limited (together, the Vendors).
Subject to the satisfaction of various conditions to completion (set out below), Atrum will acquire a total of 1,042,017,264 ACG shares and 576,000,000 warrants that are convertible into a similar number of ACG shares.
The exercise of the warrants would result in Atrum acquiring a total of 1,618,017,264 ACG shares (amounting to an interest of 26.68% of ACG's enlarged issued share capital).
The consideration for the Acquisition will consist of the following cash and scrip components payable on completion of the Acquisition:
- a cash payment of US$3,000,000;
- a cash payment of approximately US$1,130,000 for outstanding warrants and as a negative control premium, the payment of which is conditional on Atrum acquiring a minimum of 25.01% of ACG on a fully diluted basis; and
- such number of Atrum shares that is equal to US$3,000,000 (Consideration Shares).
When calculating the number of Consideration Shares to be issued, Atrum must use the volume weighted average price of Atrum shares during the 10 trading days immediately before completion of the Acquisition and applying the AUD/USD exchange rate for the business day before the day on which completion of the Acquisition is to occur.
The transaction is not expected to result in any changes to the Atrum board.
Conditions to Completion
Completion of the Acquisition is subject to a number of conditions being satisfied or waived. If required by Atrum during the due diligence process, the parties will be required to enter into a more detailed share purchase agreement documenting the terms of the Acquisition. The other conditions include:
- Atrum calling an EGM of its shareholders and obtaining all approvals necessary to enter into or obtain the benefit of the escrow agreement referred to below, issue the Consideration Shares to the Vendors, finance the Acquisition and otherwise complete the Acquisition.
- A condition relating to the financing of the Acquisition.
- The results of any due diligence investigation carried out by Atrum in relation to ACG and its subsidiaries being satisfactory to Atrum.
- The Vendors each signing an escrow agreement under which they agree not to sell or otherwise deal with any of the Consideration Shares to be issued to the Vendors for a period of 12 months following completion of the Acquisition (unless the dealing is part of a transfer arranged by Atrum and approved by the relevant Vendor).
To view the full report, please visit:
http://abnnewswire.net/lnk/I2GNQUWG
About Atrum Coal Limited
Atrum Coal Limited (ASX:ATU) is a metallurgical coal developer. The Company flagship asset is the 100%-owned Elan Hard Coking Coal Project in southern Alberta, Canada. Elan hosts large-scale, shallow, thick, hard coking coal (HCC) deposits with a current JORC Resource Estimate of 298 Mt (70 Mt Indicated and 228 Mt Inferred). Comprehensive quality testing of Elan South coal on samples from the 2018 exploration program, combined with review of substantial historical testwork data for the broader Elan Project, has confirmed Tier 1 HCC quality.
The initial focus for development is the Elan South area, which is located approximately 13 km from an existing rail line with significant excess capacity, providing direct rail access to export terminals in Vancouver and Prince Rupert. Elan South shares its southern boundary with Riversdale Resources Grassy Mountain Project, which is in the final permitting stage for a 4.5 Mtpa open-cut HCC operation. Around 30km to the west, Teck Resources operates five mines (the Elk Valley complex) producing approximately 25 Mtpa of premium HCC for the seaborne market.
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