1.            General information

 

Angus Energy Plc (the "Company") is incorporated and domiciled in the United Kingdom. The address of the registered office is Building 3 Chiswick Park, 566 Chiswick High Road, London, W4 5YA.

 

The principal activity of the Company is that of investment holding. The principal activity of the Group is that of oil and gas extraction for distribution to third parties. The principal activities of the various operating subsidiaries are disclosed in Note 12.

 

2.            Presentation of financial statements

 

The financial statements have been presented in Pounds Sterling (£) as this is the currency of the primary economic environment that the group operates in. The amount is rounded to the nearest thousand (£'000), unless otherwise stated.

 

3.            Accounting policies

 

The material accounting policies applied in the preparation of these financial statements are set out below.

 

3.1          Basis of preparation

 

These financial statements have been prepared in accordance with UK adopted international accounting standards and with the requirements of the Companies Act 2006. The financial statements have been prepared on the historical cost basis except for certain assets and liabilities which are stated at their fair value.

 

3.2          New standards, amendments and interpretations issued but not yet effective

 

The Directors have considered new standards, amendments and interpretations that have been issued but are not yet effective and that may be relevant to the Group. The Directors do not expect these to have a material impact on the Group's financial statements. The standards assessed include those relating to presentation and disclosure, supplier finance arrangements and the classification of liabilities, where applicable. The Group will adopt new requirements when they become effective.

 

3.3          Going concern

 

Cash generation during the year continued to be driven primarily by gas production from the Saltfleetby field. The Group recorded a profit of £0.14 million for the year. EBITDA for the year was £8.3 million (2024: £10.8 million). The Group recognised a fair value gain on derivative financial instruments of £9.1 million, reflecting movements in forward gas prices used to value the Group's derivative arrangements as at 30 September 2025 These instruments will settle over time through future cash payments as gas production is delivered under the associated arrangements (see Note 22). The fair value movement recognised during the year is non-cash in nature and reflects the revaluation of future settlement obligations rather than current period operating cash flows.

 

At 30 September 2025, the Group held cash of £1.1 million. During the year, the Group raised £1.0 million through the issue of new ordinary shares to support the settlement of outstanding liabilities. In addition, on 27 February 2024 the Company agreed the refinancing of its existing debt with a subsidiary of Trafigura Group Pte Ltd ("Trafigura"). The Company subsequently entered into definitive loan documentation and drew down the full £20 million facility (see Note 21), which was used to repay existing debt, stabilise the Group's creditor position and provide funding for ongoing operations and planned capital expenditure at the Saltfleetby and Brockham fields. Trafigura has not demanded repayment of the facility and continues to work with the Company in respect of the proposed refinancing and restructuring arrangements.

 

Subsequent to the reporting date, the Company has been progressing the refinancing and restructuring of its financing arrangements with Trafigura, the counterparties to the Overriding Royalty Interest attached to the Saltfleetby Gas Field and Forum Energy Services Limited in respect of the deferred consideration relating to the acquisition of Saltfleetby Energy Limited. The Company has reached agreement in principle on the key commercial terms of the proposed restructuring and is currently working with the relevant parties and its advisers to finalise the definitive documentation required to implement these arrangements. The lenders have continued to engage constructively with the Company during these discussions.

 

The Directors have prepared detailed cash flow forecasts covering a period of at least 12 months from the date of approval of these financial statements. In assessing going concern, the Directors considered the Group's forecast revenues, operating costs, financing obligations and committed capital expenditure, together with a number of reasonably plausible downside scenarios, including potential delays to expected future production.

 

In making this assessment, the Directors considered the current performance of the Saltfleetby gas field, including the commissioning of the booster compressor and ongoing production optimisation activities, together with the Group's obligations under the Trafigura debt facility and derivative instruments, which remain payable even in the event of production delays (see Note 22), and the ongoing discussions with lenders regarding the proposed refinancing and restructuring of the Group's financing arrangements.

 

The Group's forecast cash flows remain sensitive to any prolonged interruption to gas production. Current production levels exceed the volumes required to settle the derivative instruments; however, should there be a significant or sustained disruption to production, or a breach of the covenants under the Group's refinanced arrangements, the Group may be required to seek waivers from Trafigura or additional funding.

 

Based on the Directors' current expectations, including forecast production, commodity prices, operating costs and the anticipated completion of the proposed refinancing and restructuring arrangements, the Directors consider that the Group has sufficient resources to continue in operational existence for a period of at least 12 months from the date of approval of these financial statements. Accordingly, the Directors have prepared the financial statements on a going concern basis.

 

Notwithstanding the Directors' expectation that the proposed refinancing and restructuring will be successfully completed, the Group's dependence on continued gas production, compliance with the covenants under the Group's refinanced arrangements, and the successful completion of the proposed restructuring give rise to a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern. While recently completed workovers have been successfully undertaken and support current production levels, the Group plans to drill an additional well which is expected to further support production and enhance liquidity headroom.

 

These financial statements do not include any adjustments that would be required if the Group or the Company were unable to continue as a going concern.

 

3.4          Basis of consolidation

 

The consolidated financial statements comprise the financial information of the Company and its subsidiaries (the "Group") made up to the end of the reporting period. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

 

The consolidated financial statements present the results of the Company and its subsidiaries and joint arrangements as if they formed a single entity. Inter-company transactions and balances between group companies are therefore eliminated in full. The financial information of subsidiaries is included in the Group's financial statements from the date that control commences until the date that control ceases.

 

Profit or loss and each component of other comprehensive income (OCI) are attributed to the equity holders of the parent of the Group. When necessary, adjustments are made to the financial information of subsidiaries to bring their accounting policies into line with the Group's accounting policies. All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full, on consolidation.

 

 

 

3.5          Oil and natural gas exploration and evaluation (E&E) expenditure

 

Oil and natural gas exploration and evaluation expenditure are accounted for by using the successful efforts method of accounting.

 

(a)           Licence and property acquisition costs

 

Licence and property leasehold acquisition costs are capitalised within intangible fixed assets and amortised on a straight-line basis over the estimated period of exploration. Upon determination of economically recoverable reserves, amortisation the remaining costs are aggregated with exploration expenditure and held on a field-by-field basis as proved properties awaiting determination within intangible fixed assets. When development is sanctioned, the relevant expenditure is transferred to tangible production assets.

 

(b)           Exploration expenditure

 

Geological and geophysical exploration costs are charged against income as incurred. Costs directly associated with an exploration well are capitalised as an intangible asset until drilling of the well is complete and the results have been evaluated. If hydrocarbons are not found, the exploration expenditure is written off as a dry hole. If hydrocarbons are found, and subject to further appraisal activity, are likely to be capable of commercial development, the costs continue to be carried as an asset. All such carried costs are subject to regular technical and commercial management review to confirm the continued intent to develop or otherwise extract value from the discovery. When this is no longer the case, the costs are written off. When proven and probable reserves of oil and gas are determined and development is sanctioned, the relevant expenditure is transferred to tangible production assets.

 

(c)            Development expenditure

 

Expenditure on the construction, installation and completion of infrastructure facilities such as platforms, pipelines and the drilling of development wells, including unsuccessful development or delineation wells, is capitalised within tangible production assets.

 

(d)           Maintenance expenditure

 

Expenditure on major maintenance, refits or repairs is capitalised where it enhances the performance of an asset above its originally assessed standard of performance; replaces an asset or part of an asset which was separately depreciated, and which is then written off; or restores the economic benefits of an asset which has been fully depreciated. All other maintenance expenditure is charged to income as incurred.

 

                Treatment of E&E assets at conclusion of appraisal activities

 

Intangible E&E assets related to each exploration licence/prospect are carried forward, until the existence (or otherwise) of commercial reserves has been determined. If commercial reserves have been discovered, the related E&E assets are assessed for impairment on a cost pool basis as set out below. E&E assets are assessed for impairment in accordance with IFRS 6, and any impairment loss is recognised in profit or loss. When development is sanctioned and proved and probable reserves have been determined, the relevant E&E expenditure is transferred to oil and gas production assets within property, plant and equipment.

 

3.6          Financial instruments

 

Financial assets and financial liabilities are recognised in the Group's statement of financial position when the Group becomes a party to the contractual provisions of the instrument.

 

Financial assets at amortised cost

 

Financial assets are recognised initially at fair value plus directly attributable transaction costs (except for financial assets at fair value through profit or loss). Financial assets measured at amortised cost are subsequently measured using the effective interest method and are subject to expected credit loss impairment in accordance with IFRS 9.

Trade receivables are recognised initially at the transaction price and subsequently measured at amortised cost, less any impairment losses.

 

Trade and other payables

 

Trade and other payables are initially measured at fair value, net of transaction costs, and are subsequently measured at amortised cost, where applicable, using the effective interest method, with interest expense recognised on an effective yield basis.

 

Borrowing costs

 

Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalised as part of the cost of that asset in accordance with IAS 23. Capitalisation commences when expenditures and borrowing costs are being incurred and activities necessary to prepare the asset for its intended use are in progress, and ceases when substantially all such activities are complete. Other borrowing costs are recognised in profit or loss as incurred.

 

Derivative financial instrument

 

The group uses derivative financial instruments to hedge its commodity price risk, such as commodity swap contracts. The Group has elected not to apply hedge accounting on this derivative. Derivative financial instruments are recognised at fair value on the date on which the contract is entered into and subsequently measured at fair value. Derivatives are carried as a financial asset when the fair value is greater than its initial measurement and financial liabilities when fair value is negative. Gains and losses arising from changes in the fair value of derivatives are recognised in profit or loss within the statement of profit or loss and other comprehensive income. The Group does not apply hedge accounting. Further information on the Group's derivative instruments and valuation is set out in Note 22.

 

In determining the fair values of the financial asset and liabilities, instruments are analysed into Level 1 to 3 as follows:

 

Level 1: Fair value measurements derive from quoted prices (unadjusted) in active market for identical assets or liabilities.

Level 2:   Fair value measurement derives from inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3:  Fair value measurements derive from valuation techniques that include inputs for the asset or liability that are not based on observable market data.

 

Derivatives are measured at fair value using valuation techniques that incorporate observable market inputs and are classified within Level 2 of the fair value hierarchy. For other financial assets and liabilities measured at amortised cost, the carrying amounts are considered to approximate fair value where the instruments are short term or reprice frequently.

 

3.7        Impairment of assets

 

(a)           Financial assets

 

Impairment provisions for current receivables are recognised based on the simplified approach within IFRS 9. During this process the probability of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such provisions are recorded in a separate provision account with the loss being recognised within administration costs in the consolidated statement of comprehensive income. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

 

Impairment provisions for receivables from related parties and loans to related parties are recognised based on a forward looking expected credit loss model. The methodology used to determine the amount of the provision is based on whether there has been a significant increase in credit risk since initial recognition of the financial asset. For those for which credit risk has increased significantly, lifetime expected credit losses are recognised, unless further information becomes available contrary to the increased credit risk. For those that are determined to be permanently credit impaired, lifetime expected credit losses are recognised.

 

(b)           Non-financial assets

 

The carrying amounts of the Group's non-financial assets, other than deferred tax assets, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. For assets that have indefinite lives, the recoverable amount is estimated at each reporting date.

 

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risk specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or groups of assets (the "cash generating unit").

 

An impairment loss is recognised if the carrying amount of an asset or its cash generating unit exceeds its estimated recoverable amount. Impairment losses are recognised in the profit or loss.

 

3.8        Oil and gas production assets

 

Expenditures related to the construction, installation or completion of infrastructure facilities, such as platforms and pipelines, and the drilling of development wells, including delineation wells, are capitalised within oil and gas production assets. The initial cost of an asset comprises its purchase price or construction cost, any costs directly attributable to bringing the asset into operation, the initial estimate of the abandonment cost for qualifying assets, and borrowing costs (see Note 3.13 on decommissioning).

 

Oil and gas production assets are depreciated using a unit of production method.  The cost of producing wells is amortised over total proved and undeveloped oil and gas reserves of the field concerned, except in the case of assets whose useful life is shorter than the lifetime of the field, in which case the straight-line method is applied. Rights and concessions are depleted on the unit-of-production basis over the total proved developed and undeveloped reserves of the relevant area. The unit-of-production rate calculation for the depreciation of field development costs takes into account expenditures incurred to date, together with sanctioned future development expenditure.

 

The consideration receivable on disposal of an item of property, plant and equipment or an intangible asset is recognised initially at its fair value by the Group. However, if payment for the item is deferred, the consideration received is recognised initially at the cash price equivalent. The difference between the nominal amount of the consideration and the cash price equivalent is recognised as interest revenue. Any part of the consideration that is receivable in the form of cash is treated as a financial asset and is accounted for at amortised cost.

 

3.9        Contingent liabilities

 

A contingent liability is a possible obligation that arises from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group.  It can also be a present obligation arising from past events that is not recognised because it is not probable that outflow of economic resources will be required, or the amount of obligation cannot be measured reliably.

 

A contingent liability is not recognised but is disclosed in the Notes to the accounts.  When a change in the probability of an outflow occurs so that the outflow is probable, it will then be recognised as a provision. A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain events not wholly within the control of the Group.

 

The Company and its subsidiaries are, from time-to-time, parties to legal proceedings and claims which arise in the ordinary course of business. The Directors do not anticipate that the outcome of these proceedings and claims will have a material adverse effect on the Group's financial position or on the results of its operations.

 

3.10       Cash and Cash Equivalents

 

Cash in the statement of financial position is cash held on call with banks.

 

3.11        Income tax

 

Income tax expense represents the sum of the tax currently payable and deferred tax.

 

The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the comprehensive income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are not taxable or tax deductible. The Group's liability for current tax is calculated using tax rates (and tax laws) that have been enacted or substantively enacted in countries where the Group and its subsidiaries operate by the end of the financial period.

 

Deferred income taxes are calculated using the balance sheet method. Deferred tax is generally provided on the temporary difference between the carrying amounts of assets and liabilities and their tax bases. However, deferred tax is not provided on the initial recognition of goodwill, nor on the initial recognition of an asset or liability unless the related transaction is a business combination or affects tax or accounting profit or at the time of the transaction, it does not give rise to equal taxable and deductible temporary differences. Deferred tax on temporary differences associated with shares in subsidiaries and joint ventures is not provided if reversal of these temporary differences can be controlled by the Group and it is probable that reversal will not occur in the foreseeable future. In addition, tax losses available to be carried forward as well as other income tax credits to the Group are assessed for recognition as deferred tax assets.

 

Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is probable that the underlying deductible temporary differences will be able to be offset against future taxable income. Current and deferred tax assets and liabilities are calculated at tax rates that are expected to apply to the respective period it is recognised, provided they are enacted or substantively enacted at the reporting date.

 

Changes in deferred tax assets or liabilities are recognised as a component of tax expense in the Consolidated Statement of Comprehensive Income, except where they relate to items that are charged or credited directly to equity in which case the related deferred tax is also charged or credited directly to equity.

 

3.12       Foreign currencies

 

Monetary assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the reporting date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of the transaction. Exchange differences are recognised in profit or loss.

 

3.13        Decommissioning

 

Provision for decommissioning is recognised in full on the installation of oil and gas production facilities. The amount recognised is the present value of the estimated future expenditure determined in accordance with local conditions and requirements. A corresponding tangible fixed asset of an amount equivalent to the provision is also created. This is subsequently depreciated as part of the capital costs of the production and transportation facilities. Any change in the present value of the estimated expenditure is reflected in an adjustment to the provision and fixed assets.

 

3.14        Revenue

 

As described in Note 5, the Group's revenue is driven by the sale of natural gas, condensate and crude oil, the goods are sold on their own in separate identified contracts with customers. The gas sales agreement has a fixed discount to the ICIS Heren NBP price, the oil offtake agreement has a fixed discount to the Brent forward curve while the condensate offtake agreement has a fixed discount to the Naphtha forward curve. Delivery point of the sale is the point at which the natural gas passes from the Company's pipeline to the national grid or when crude oil passes from the delivery tanker to the customers specified storage terminal, which represents the point at which the Group fulfils its single performance obligation to its customer under contracts for the sale of natural gas or crude oil.  Revenue from the production of oil and gas, in which the Group has an interest with other producers, is recognised proportionately based on the Group's working interest and the terms of the relevant production sharing contracts.

 

Interest income is accrued on a time basis, by reference to the principal outstanding and at the applicable effective interest rate.

 

3.15        Share-based payments

 

The Group has applied IFRS 2 Share-based Payment for all grants of equity instruments.

 

The Group issues equity-settled share-based payments to its employees. Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group's estimate of the shares that will eventually vest.

Fair value is measured using the Black Scholes model. The expected life used in the model has been adjusted, based on management's best estimate. The inputs to the model include: the share price at the date of grant, exercise price expected volatility, risk free rate of interest.

 

4.            Critical accounting estimates and sources of estimation uncertainty

 

In applying the accounting policies, the directors may at times require to make critical accounting judgements and estimates about the carrying amount of assets and liabilities. These estimates and assumptions, when made, are based on historical experience and other factors that the directors consider are relevant.

 

The key estimates and assumptions concerning the future and other key sources of estimation uncertainty at the end of the financial year, that have significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are reviewed are as stated below.

 

Key accounting judgements

 

(a)           Impairment of non-current asset

 

The Group's non-current assets represent its most significant assets, comprising oil and gas production assets, exploration and evaluation (E&E) assets on its onshore sites.

 

Management is required to assess exploration and evaluation (E&E) assets for indicators of impairment and has considered the economic value of individual E&E assets. The carrying amount of the E&E assets are subject to a separate review for indicators of impairment, by reference to the impairment indicators set out in IFRS 6, which is inherently judgmental.

Processing operations are large, scarce assets requiring significant technical and financial resources to operate. Their value may be sensitive to a range of characteristics unique to each asset and key sources of estimation uncertainty include proved reserve estimates, future cash flow expected to arise from the cash-generating unit and a suitable discount rate.

 

In performing impairment reviews, the Group assesses the recoverable amount of its operating assets principally with reference to the Group's independent competent person's report, estimates of future oil and gas prices, operating costs, capital expenditure necessary to extract those reserves and the discount rate to be applied to such revenues and costs for the purpose of deriving a recoverable value.

 

As detailed in Notes 10 and 11, the carrying amount of the Group's E&E assets and oil and gas production assets at 30 September 2025 were approximately £68.0 million (2024: £70.9 million) and £5.4 million (2024: £5.4 million) respectively.

The methods, key assumptions, sensitivity and possible outcomes in relation to the calculation of the estimates are detailed in Note 10.

 

(b)    Going concern

 

Forecast cash flows place reliance on there not being a suspension of gas production for an unforeseen significant period. Current production levels are in excess of derivative requirements; however, the Group's forecasts remain sensitive to any prolonged interruption to gas production and the timing of cash flows relative to settlement obligations. While recently completed workovers have been successfully undertaken and are expected to support current production levels, the Group plans to drill an additional well which is expected to further support production and enhance liquidity headroom. In the event of significant production delays or breaches of covenants under the Group's refinanced arrangements, the Group may be required to seek waivers or additional funding. There are no present operational concerns and, whilst mitigating actions could be taken, the contracted derivative will need to be settled at a fixed point in time. In the event of any significant delay, this may require further negotiation with the derivative holder or additional funding.

 

As disclosed in Note 3.3, the directors consider the Group and the Company to be a going concern while the Group will continue to operate under the management's plan and the Directors consider the going concern basis appropriate, subject to the material uncertainty disclosed in Note 3.3.

 

Key accounting estimates

 

(a)   Decommissioning costs

 

Decommissioning costs will be incurred by the Group at the end of the operating life of some of the Group's facilities and properties. The Group assesses its decommissioning provision at each reporting date. The ultimate decommissioning costs are uncertain, and cost estimates can vary in response to many factors, including changes to relevant legal requirements, the emergence of new restoration techniques or experience at other production sites. The expected timing, extent and amount of expenditure may also change, for example, in response to changes in reserves or changes in laws and regulations or their interpretation. Therefore, significant estimates and assumptions are made in determining the provision for decommissioning. As a result, there could be significant adjustments to the provisions established which would affect future financial results.

 

External valuers may be used to assist with the assessment of future decommissioning costs. The involvement of external valuers is determined on a case-by-case basis, taking into account factors such as the expected gross cost and timing of abandonment, and is approved by the directors. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained.

 

As detailed in Note 20, the provision at the reporting date represents management's best estimate of the present value of the future decommissioning costs required.

 

(b) Valuation of derivative liability

 

On 01 June 2021, Angus Energy Weald Basin no. 3 Limited (AWB3) entered into a derivative agreement with Mercuria Energy Trading SA (METS) under a Swap contract as part of the condition of the Loan Facility (see Note 21). The derivative instrument was used to mitigate price risk on the expected future cash flow from the production of Saltfleetby Gas Field. Under the Swap contract, AWB3 will pay METS the floating price while METS will pay AWB3 the fixed price on the sale of gas from the field.

 

In connection with the refinancing of the Mercuria facility with Trafigura in February 2024, the existing Mercuria hedging arrangements were novated and restructured with Trafigura, resulting in an additional credit cost of 6 pence per therm.

 

The carrying value of the financial instrument approximates their fair value and was valued using Level 2 fair value hierarchy valuation. The fair value has been determined with reference to commodity yield curves, as adjusted for liquidity and trading volumes as at the reporting date supplied by the Group's hedging partner, Trafigura.  Management also assessed the valuation of these swaps using publicly available forward pricing curves.

 

5.            Revenue and segment information

         

The Group's principal revenue is derived from the sale of natural gas and oil produced from its UK onshore assets. All revenue arose from continuing operations within the United Kingdom.

 

The Chief Operating Decision Maker ("CODM"), being the Board of Directors, reviews financial performance on a consolidated basis and does not receive discrete financial information for individual fields or assets. Accordingly, the Group has determined that it operates as a single operating and geographical segment for the purposes of IFRS 8 Operating Segments.

 

Revenue is generated from the following sources:

 

			2025		2024
			£'000		£'000
Sale of oil			1,446		1,721
Sale of natural gas			16,564		20,081
			18,010		21,802

 

All of the Group's non-current assets are located in the United Kingdom.

 

Major customers

 

For the year ended 30 September 2025, sales of natural gas to Trafigura Group Pte Ltd represented more than 90% of the Group's total revenue (2024: more than 90%). No other customer represented 10% or more of total Group revenue in either period.

 

6.            Operating profit

 

Operating profit is stated after charging:

	2025		2024
	£'000		£'000
Depreciation of owned assets	10		6
Employee benefit expense	1,839		2,177
Auditor's remuneration
Fees payable to the Company's auditor in respect of the audit of the Parent Company and the consolidated financial statements	77		73
	77		73

               

Adjusted operating result

 

The Group presents an adjusted operating result to provide additional information on underlying operating performance by excluding non-cash and non-operating items arising from the remeasurement of derivative financial instruments. This measure is not defined under IFRS and may not be comparable with similar measures presented by other companies.

 

The adjusted operating result is reconciled to profit/(loss) after tax as follows:

 

 

               

	2025		2024
	£'000		£'000
Profit/(loss) after tax	143		(4,301)
Derivative financial instrument (profit)/loss	9,112		(10,822)
Adjusted profit/(loss) after tax	9,255		(15,123)

 

In 2025, the Group recorded a significant non-cash fair value gain on derivative instruments reflecting higher forward gas prices. Excluding this item, the Group delivered a materially improved underlying performance.

 

7.            Finance cost

 

Finance costs for the year comprise:

 

			2025		2024
			£'000		£'000
Loss on revaluation of AFS investment			3		6
Other finance costs			349		1,376
Loan interest expense			3,231		2,722
			3,583		4,104

Other finance costs

 

Other finance costs primarily comprise:

·        commitment and arrangement fees on the Trafigura facility

·        interest on crystallised and deferred hedge settlement balances

·        amortisation of financing transaction costs

 

The decrease in other finance costs in 2025 primarily reflects the refinancing of the Mercuria loan and associated derivative facilities into the Trafigura facility in the prior year.

 

The Group is progressing discussions with Trafigura regarding the potential refinancing and restructuring of the facility subsequent to the reporting date. Further details are disclosed in Note 27.

 

8.            Employee benefit expense

 

The Group's employee benefit expense for the year comprises:

 

			2025		2024
			£'000		£'000
Wages and salaries (excluding Directors)			1,569		1,895
Social security costs (excluding Directors)			270		282
			1,839		2,177

 

These amounts relate to employees other than Directors.

 

Directors' remuneration for the year totaled £598,000 (2024: £609,000), comprising salaries and fees, and is disclosed in detail in the Directors' Remuneration Report. For the purposes of IAS 24, key management personnel comprise the Directors of the Company.

 

 

Average number of employees

 

The average monthly number of persons (including Executive Directors) employed by the Group during the year was:

	2024		2024
	Number		Number
The average number of employees during the year was:
Director	5		4
Management	10		12
Operators	11		11
	26		27

9.            Taxation on ordinary activities

 

No liability to corporation tax arose for the years ended 30 September 2025 or 30 September 2024 due to the availability of brought-forward tax losses and capital allowances within the relevant ring-fenced entities.

 

The Group's tax charge comprises only UK corporation tax. There are no overseas operations.

 

                Reconciliation of effective tax rate

		2025		2024
		£'000		£'000
Profit / (loss) before tax		143		(4,301)
Tax at UK ring-fence corporation tax rate of 40% (2024: 40%)		57		(1,720)
Adjustments for:
Non-deductible expenses		2,393		6,803
Movements in temporary differences not recognised
Utilisation of brought-forward losses		-		-
Unrecognised deferred tax		(2,450)		(5,083)
Tax charge / (credit)		-		-

 

Tax losses and deferred tax

 

At 30 September 2025, the Group had tax losses of approximately £178.0 million (2024: £166.4 million) available for offset against future taxable profits of the subsidiaries in which those losses arose.

 

These losses primarily relate to UK ring-fenced oil and gas activities and include losses acquired on the acquisition of Saltfleetby Energy Limited. Under UK tax rules, these losses are not transferable between Group entities and can only be utilised against future profits of the relevant subsidiary.

 

No deferred tax asset has been recognised in respect of these losses, as the Directors consider that there is insufficient certainty at the reporting date that taxable profits will be available in the relevant entities against which the losses can be utilised in the foreseeable future, in accordance with IAS 12.

 

 

 

 

 

 

 

 

 

10.          Oil and gas production assets

	Total
	£'000
Cost or valuation
At 1 October 2023	93,952
Additions	3,479
Increase abandonment provision	726
At 30 September 2024	98,157
Additions	2,450
Increase abandonment provision	929
At 30 September 2025	101,536
Depreciation and impairment
At 1 October 2023	13,704
Impairment of asset	4,770
Charge for the year	8,732
At 30 September 2024	27,206
Impairment of asset	-
Charge for the year	6,320
At 30 September 2025	33,526
Net book value
At 30 September 2024	70,951
At 30 September 2025	68,010

 

Reconciliation of additions to cash capital expenditure

 

			£'000
Additions to oil and gas production assets (Note 10)			2,450
Less: other non-cash movements and accrual adjustments			(17)
Cash expenditure on oil and gas production assets (cash flow statement)			2,433

 

Interests in producing assets

 

At 30 September 2025 the Group held:

 

·      100% of the Saltfleetby Gas Field

·      80% of the Brockham Oil Field

·      80% of the Lidsey Oil Field

 

The Group remains operator of all fields.

 

Impairment Review

 

The Group tests oil and gas production assets for impairment when indicators exist, in accordance with IAS 36. Each field represents a separate cash-generating unit ("CGU").

 

The recoverable amount is determined based on value-in-use calculations using discounted cash flow models over the economic life of each field.

 

 

 

 

 

The key assumptions used were:

		2025	2024
Post-tax discount rate		10%	10%
Natural gas price (per Therm)		£0.80	£0.86
Brent oil price (per barrel)		$70	$83
Growth rate		0%	0%

 

Production profiles reflect current reservoir models and operating plans, assuming facilities operate at efficient capacity over field life. The growth rate is assumed to be zero and the level of production is constant on the basis the production plant is assumed to be at the most efficient capacity over the period of extraction.

 

Reserves and production profiles

 

Commercial reserves represent 2P (proved and probable) reserves on an entitlement basis. These underpin depreciation calculated using the Unit-of-Production (UOP) method.Reserve and production estimates are prepared internally and reviewed by management using operator data and external competent person inputs.

 

Impairment conclusion (2025)

 

Management assessed each producing CGU using updated production forecasts, pricing assumptions and operating costs. No impairment charge was recognised in 2025.

 

Sensitivity analysis

 

The recoverable amounts were most sensitive to commodity prices and discount rates.

 

The following movements would give rise to impairment:

 

·      Saltfleetby: gas prices would need to fall by ~5% below the base assumption

·      Brockham: oil prices would need to fall by ~5% below the base assumption

 

An increase of:

·      2.5% in the Saltfleetby discount rate, or

·      15% in the Brockham discount rate

 

would also result in impairment.

 

11.          Exploration and evaluation assets

 

	Total
	£'000
Cost or valuation
At 1 October 2023	5,628
Additions	18
Increase abandonment provision	2
Disposal	(192)
At 1 October 2024	5,456
Additions	-
Increase abandonment provision	8
At 30 September 2025	5,464

 

Nature of E&E assets

 

Exploration and evaluation ("E&E") assets comprise capitalised costs relating to the acquisition, exploration and appraisal of oil and gas licences and prospects prior to the determination of commercial reserves. E&E assets are carried on a field-by-field basis and are not amortised until technical feasibility and commercial viability of extraction have been established, at which point the assets are transferred to oil and gas production assets.

 

Impairment assessment

 

In accordance with IFRS 6, the Group assesses exploration and evaluation ("E&E") assets for impairment when facts and circumstances indicate that their carrying amount may not be recoverable.

 

During the year, planning consent for extended testing at the Balcombe site, which had previously been granted in October 2023, was subject to judicial challenge. In April 2025, the High Court ruled in favour of the Company, confirming the validity of the consent. However, due to the prolonged uncertainty created by the legal challenge, the Company was unable to complete the detailed engineering, procurement and contracting work required to commence the well test and the existing planning consent will expire before it can be activated.

 

Accordingly, the Group intends to submit a revised planning application following completion of a technical review of the site and updated development plan. Management considers this to represent a timing and procedural matter rather than a loss of technical or commercial viability of the underlying asset.

 

In assessing whether this situation constituted an impairment indicator under IFRS 6, the Directors considered:

 

·      the outcome of the High Court decision;

·      the continued retention of the licence;

·      the technical viability of the reservoir;

·      management's intention to resubmit a revised plan; and

·      the strategic importance of the asset within the Group's portfolio.

 

Based on this assessment, the Directors concluded that the asset continues to have future economic potential and that no impairment indicator existed at 30 September 2025. Accordingly, no impairment of E&E assets was recognised during the year.

 

12.          Subsidiaries

         

The Group's subsidiaries at 30 September 2025 are set out below. All subsidiaries are incorporated and operate in the United Kingdom unless otherwise stated.

Name of subsidiary/ place of incorporation		Principal activity
Angus Energy Holdings UK Limited		Investment holding company
Angus Energy Weald Basin No.1 Limited		Investment holding company
Angus Energy Weald Basin No.2 Limited		Investment holding company
Angus Energy Weald Basin No.3 Limited*		Oil extraction for distribution to third parties
Angus Energy North America Limited		Dormant company
Saltfleetby Energy Limited		Natural Gas Extraction

* Angus Energy Weald Basin No.3 Limited is held indirectly through Angus Energy Weald Basin No.2 Limited.

 

The registered office address of the respective entity as follow:

 

 

 

 

 

 

 

Registered address	Name of subsidiary
Building 3 Chiswick Park, 566 Chiswick High Road, London, W4 5YA.	Angus Energy Weald Basin No.2 Limited Angus Energy North America Limited Saltfleetby Energy Limited
5 South Charlotte Street, Edinburgh, Scotland, EH2 4AN	Angus Energy Holdings UK Limited Angus Energy Weald Basin No.1 Limited Angus Energy Weald Basin No.3 Limited

 

13.          Financial investments at fair value through profit or loss

 

The Group holds an equity investment in Alba Mineral Resources Plc, an AIM-quoted company. The investment comprises 12,407,910 ordinary shares.

 

Under IFRS 9 - Financial Instruments, this investment is classified as an equity instrument measured at fair value through profit or loss ("FVTPL"), as the Group has not elected to present fair value movements in other comprehensive income.

 

The fair value is determined using the quoted bid price of Alba Mineral Resources Plc shares on AIM at the reporting date.

 

Movement in fair value:

	2025		2024
	£'000		£'000
At 1 October	5		11
Loss on revaluation for the year	(3)		(6)
At 30 September	2		5

       

The fair value losses are included within finance costs in the consolidated statement of comprehensive income (see Note 7).

 

14.          Trade and other receivables

 

			2025		2024
			£'000		£'000
Current
Accrued sales income			1,173		1,801
Amounts due from customers/farmees			276		285
Rent deposit			150		150
VAT recoverable			408		610
Other receivables			507		528
TOTAL			2,514		3,374

 

All trade and other receivables are expected to be recovered within twelve months. The carrying amounts of trade and other receivables approximate their fair values due to their short-term nature.

 

Based on the credit quality of counterparties, payment history and forward-looking information, the Directors consider that no material expected credit loss provision is required at either reporting date.

 

 

 

			2025		2024
			£'000		£'000
Trade and other receivables			2,514		3,374
Less: Impairment allowance			-		-
			2,514		3,374

15.          Share capital and Share Premium

 

                Issued share capital:

 

                All ordinary shares have a nominal value of £0.002 and carry one vote per share.

 

	Issue price In pence	Number of shares	Ordinary share capital	Share premium
Ordinary share of £0.002 each			£'000	£'000
At 30 September 2023		3,626,860,032	7,254	45,500
Issue of shares 6 November 2023	0.66	516,033,308	1,032	2,374
Issue of shares 7 March 2024	0.4	25,000,000	50	50
Issue of shares 27 March 2024	0.4	226,513,000	453	453
Issue of shares 15 May 2024	0.3544	27,448,470	55	42
Less: Issuance of costs		-	-	(7)
At 30 September 2024		4,421,854,810	8,844	48,412
Issue of shares 17 March 2025	0.23448	565,038,604	1,130	194
		-	-	-
At 30 September 2025		4,986,893,414	9,974	48,606

 

Equity issue in the year

 

On 17 March 2025, the Company issued 565,038,604 ordinary shares at an average price of 0.23448 pence per share discounted at 15% in settlement of deferred consideration arising on the acquisition of Saltfleetby Energy Limited and the accrued interest. The shares were issued in satisfaction of a contractual obligation and therefore no cash consideration was received.

 

Capital structure

 

The Company has only one class of shares in issue: ordinary shares, which carry equal voting, dividend and capital distribution rights.

 

16.          Share-based payments

               

The Group previously operated an Enterprise Management Incentive (EMI) scheme and a Non-Executive Director and Consultant Share Option Scheme (together, the "Legacy Schemes"). As a result of the size and structure of the Group following recent growth and refinancing, the Company no longer qualifies for EMI status and the EMI scheme has therefore been discontinued. No further awards will be made under the EMI framework.

 

The Board has approved the introduction of a new discretionary share-based incentive framework which will be used for future equity awards from 2026 onwards. All future share-based awards will be made at the discretion of the Board and subject to applicable regulatory, shareholder and governance approvals.

 

No new options or warrants were granted during the year ending 30 September 2025. The group recongnised share based payment charge of approximately £0.400m (2024: £0.410) for the period relating to amortisation of options and finance costs of £0.283m (2024: £0.817m) of warrants relating to loan arrangement in previous accounting periods.

 

Outstanding options and warrants

 

At 30 September 2025, the following share options and warrants over ordinary shares of the Company were outstanding:

Exercise price	Outstanding as at 01 Oct 2024	Granted during the year	No. of  forfeited instruments during ithe year	Exercised during the year	Outstanding as at 30 September 2025	Final expiry dates
£0.06	13,626,188	-	-	-	13,626,188	13 Nov 2026
£0.09	1,050,000	-	(800,000)	-	250,000	13 Nov 2026
£0.08	8,400,000	-	-	-	8,400,000	24 Aug 2028
£0.02	17,200,000	-	-	-	17,200,000	15 Jul 2029
£0.015	18,750,000	-	-	-	18,750,000	31 Mar 2031
£0.02	117,500,000	-	(3,000,000)	-	114,500,000	9 October 2026
£0.018	70,000,000	-	-	-	70,000,000	16 April 2033
£0.0067	25,000,000	-	-	-	25,000,000	19 Dec 2034
£0.0067	30,000,000	-	-	-	30,000,000	29 August 2034
£0.0067	2,500,000	-	-	-	2,500,000	29 August 2034
Share options	304,026,188	-	(3,800,000)	-	300,226,188
£0.0165	341,633,886	-	-	-	341,633,886	20 June 2026
£0.0165	150,000,000	-	-	-	150,000,000	24 March 2026
£0.015	300,000,000	-	-	-	300,000,000	25 July 2026
Warrant	791,633,886	-	-	-	791,633,886

 

Summary of outstanding equity instruments

 

At 30 September 2025:

·      Share options outstanding: 300,226,188

·      Warrants outstanding: 791,633,886

·      Total potential ordinary shares from dilutive instruments: 1,091,860,074

 

No options or warrants were exercised during the year (2024: nil). A total of 3,800,000 options were forfeited during the year.

 

Valuation and IFRS 2 disclosure

 

The weighted average exercise price of options and warrants outstanding at 30 September 2025 was £0.01711 (2024: £0.01717). The weighted average remaining contractual life was 3.5 years (2024: 5.0 years).

 

The weighted average fair value of options at grant date was £0.0020 (2024: £0.0067). No new grants were made in the year; therefore, no additional IFRS 2 charge arose in respect of equity-settled share-based payments during 2025.

 

All outstanding awards relate to legacy grants and are subject only to service-based vesting conditions. No market-based or performance conditions remain outstanding.

 

17.          Reserves

		2025		2024
		£'000		£'000
Merger reserve		(200)		(200)

Merger reserve

 

The merger reserve arose on the acquisition of Angus Energy Holdings Limited by the Company as part of a group reorganisation. The transaction was accounted for as a merger in accordance with the principles of common control accounting, with the difference between the nominal value of shares issued and the carrying value of the net assets acquired recognised in the merger reserve.

 

The merger reserve is not distributable and represents part of the Group's equity attributable to shareholders.

 

18.          Earnings / (Loss) per share (EPS/(LPS))

 

Basic earnings / (loss) per share ("EPS/(LPS)") is calculated by dividing the profit or loss attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year.

 

Diluted earnings / (loss) per share is calculated by adjusting the weighted average number of ordinary shares in issue to assume conversion of all potentially dilutive ordinary shares. Where the effect of such potential ordinary shares is anti-dilutive, they are excluded from the calculation.

 

The earnings per share information is as follows:

		2025		2024
		£'000		£'000
Profit/(Loss) attributable to equity holders of the parent company		143		(4,301)
Weighted average number of ordinary shares		4,725,272,800		4,232,601,890
Basic EPS/(LPS) (in pence)		0.003		(0.10)
		2025		2024
		£'000		£'000
Profit/(Loss) attributable to equity holders of the parent company		143		(4,301)
Weighted average number of diluted ordinary shares		4,725,272,800		4,232,601,890
Diluted EPS/(LPS) (in pence)		0.003		(0.10)

 

At 30 September 2025 (and 2024), the outstanding share options and warrants were anti-dilutive and therefore excluded from the diluted earnings per share calculation.

 

19.          Trade and other payables

 

			2025		2024
Due within one year			£'000		£'000
Trade payables			4,381		3,637
Deferred consideration on Saltfleetby Energy Limited acquisition			1,887		2,887
Lease liability			38		18
Accruals			582		857
Interest payable - loan			610		231
Other payables			488		241
ORRI			1,192		444
			9,178		8,315

 

Due after more than one year			2025		2024
			£'000		£'000
Lease liabilities			80		-
			80		-

The carrying amounts of trade and other payables approximate their fair values due to their short-term nature.

 

Deferred consideration - Saltfleetby Energy Limited

 

On 24 May 2022, the Company acquired the entire issued share capital of Saltfleetby Energy Limited from Forum Energy Services Limited ("Forum"), resulting in 100% ownership of the Saltfleetby Gas Field. The total effective consideration payable under the share purchase agreement was £14.1 million, of which up to £6.25 million was structured as deferred consideration.

 

During the year, the Company issued ordinary shares with a value of approximately £1.324 million in partial settlement of the deferred consideration and interest accrued, reducing the outstanding balance to £1.887 million at 30 September 2025 (2024: £2.887 million).

 

At the reporting date, the remaining deferred consideration had not been restructured and is presented within trade and other payables. Subsequent to the year end, the Company has been progressing discussions with Forum Energy Services Limited regarding a revised settlement profile for this deferred consideration. As these discussions were ongoing at the date of approval of the financial statements, no adjustment has been made to the amounts recognised at the reporting date. Further details are disclosed in Note 27.

 

 Crystallised hedge balances

 

Trade and other payables at 30 September 2025 include £1.3 million relating to gas price swaps for the months of May and June 2025, which crystallised into fixed cash settlement obligations and were fully invoiced by Trafigura prior to the reporting date (see Note 22).

 

In addition, trade and other payables include £0.4 million relating to previously crystallised legacy hedge positions invoiced by Trafigura. These balances accrue interest at SONIA plus 10% until settlement in accordance with the terms of the financing arrangements.

 

Crystallised hedge balances that had not been invoiced at the reporting date continue to be presented within derivative liabilities (Note 22) in accordance with IFRS 9.

 

The crystallised hedge balances included within trade and other payables form part of the Group's broader debt restructuring discussions with Trafigura. These discussions were ongoing at the reporting date and continue to progress subsequent to the year end (see Notes 22 and 27).

 

Overriding Royalty Interest (ORRI)

 

The ORRI represents a contractual entitlement to a share of gross production revenues from the Saltfleetby Gas Field.

 

Subsequent to the reporting date, the Company has been progressing discussions with the counterparties to the Overriding Royalty Interest ("ORRI") attached to the Saltfleetby Gas Field regarding its proposed restructuring as part of the broader refinancing and restructuring arrangements currently under discussion. Further details are disclosed in Note 27.

 

 

 

 

20.          Provisions for other liabilities and charges

 

	2025		2024
	£'000		£'000
Abandonment costs
Balance b/fwd	5,698		4,970
Increased provision for Saltfleetby	794		436
Increased provision Brockham	54		80
Increased provision for Lidsey	81		210
Increase provision Balcombe	7		2
Balance c/fwd	6,634		5,698

 

Nature of the provision

 

The Group makes provision for the present value of future costs associated with the decommissioning, abandonment and restoration of oil and gas production facilities, wells, pipelines and associated infrastructure in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets and IAS 16 Property, Plant and Equipment.

 

A corresponding asset is capitalised within oil and gas production assets when the obligation is initially recognised and depreciated over the life of the relevant field.

 

Measurement and key assumptions

 

The provision represents management's best estimate of the expenditure required to settle the obligation at the reporting date, taking into account:

·      the expected timing of cessation of production for each field;

·      estimated costs of well plugging, facilities removal and site restoration;

·      inflation assumptions applied to future costs; and

·    an appropriate discount rate to reflect the time value of money and risks specific to the obligation.

 

The estimates are reviewed at each reporting date and adjusted where necessary to reflect changes in expected costs, field lives, regulatory requirements or discount rates.

 

Changes during the year

 

During the year, the provision increased primarily as a result of:

·  updated field life assumptions and cost estimates at Saltfleetby, reflecting continued development activity; and

·      routine revisions to abandonment estimates at Brockham, Lidsey and Balcombe.

 

These increases have been added to the carrying value of the related oil and gas production assets and will be depreciated over the remaining economic lives of the fields.

 

Estimation uncertainty

 

Decommissioning obligations are subject to significant estimation uncertainty, particularly in relation to:

·      future commodity prices and field economics;

·      regulatory and environmental standards at the time of abandonment;

·      technological developments in abandonment techniques; and

 

·      the timing of field cessation.

 

Actual costs incurred may differ materially from the amounts provided.

 

21.          Loan Payable

 

£20 million Trafigura Loan facility

 

On 22 February 2024, the Company agreed a refinancing of its existing debt with a subsidiary of Trafigura Group Pte Ltd ("Trafigura"). The Company entered into definitive loan documentation which allowed it to draw down in full a £20.0 million secured loan facility (the "Facility").

 

The proceeds of the Facility were applied to:

·     refinance existing senior debt of £4.5 million;

·     repay the Group's bridge facility of £6.0 million;

·     fund £1.7 million of the deferred consideration payable to Forum Energy Services Limited in connection with the acquisition of Saltfleetby Energy Limited; and

·      provide working capital and capital expenditure funding to increase gas production from the Saltfleetby Gas Field and to restart oil production at the Brockham Oil Field.

 

The Facility is secured by first fixed and floating charges over substantially all of the Group's assets, licences and contracts. The Group's gas sales and hedging arrangements were novated to Trafigura as part of the refinancing.

 

The Group incurred transaction costs of £1.8 million in connection with the Facility, which were capitalised and are being amortised over the term of the loan using the effective interest method. Of these costs, £0.5 million was paid in cash, £0.5 million was offset against the loan proceeds drawn down and £0.7 million was settled through the issue of ordinary shares. At 30 September 2025, the unamortised balance of these costs was included in the carrying value of the loan.

 

As a waiver in respect of the relevant covenant conditions had not been obtained at the reporting date, the facility has been presented as current in accordance with IFRS requirements. The lender has not demanded repayment and has continued to support the Company while discussions regarding the proposed refinancing and restructuring are ongoing. Subsequent to the reporting date, the Company has been progressing discussions with Trafigura regarding a broader refinancing and restructuring of the facility (see Note 27).

 

Carrying amount

 

£20m Trafigura Loan			2025		2024
			£'000		£'000
Principal			20,000		20,000
Unamortised transaction costs			(1,263)		(1,632)
Carrying value			18,737		18,368

Maturity profile

 

LOAN PAYABLES SUMMARY:			2025		2024
			£'000		£'000
CURRENT
Amounts due within one year			18,737		3,380
			18,737		3,380
NON-CURRENT
Amounts due after more than one year			-		14,988
			-		14,988

 

Interest and security

 

The Facility bears interest at a margin over SONIA, payable quarterly. It is secured by first fixed and floating charges over the Group's producing assets, licences, receivables and key commercial contracts, including gas offtake agreements.

 

The Facility also requires the Group to maintain gas price protection through derivative arrangements, which are described in Note 22.

 

Post-balance-sheet restructuring

 

Subsequent to the reporting date, the Company has been progressing discussions with Trafigura regarding the refinancing and restructuring of the facility. Further details are provided in Note 27.

 

22.    Derivative Liability

 

The Group uses commodity derivative instruments to manage its exposure to fluctuations in natural gas prices arising from production at the Saltfleetby Gas Field. These derivatives take the form of fixed-price gas swap contracts and are not designated for hedge accounting under IFRS 9.

 

Following the refinancing of the Group's Mercuria facility with Trafigura in February 2024, all existing swap contracts were novated to Trafigura Group Pte Ltd. As part of this refinancing, the hedge profile was amended and a credit charge of 6 pence per therm was applied. Under the terms of the Trafigura facility, the Group is required to maintain rolling gas price protection in line with minimum hedging thresholds set out in the financing agreement.

 

Outstanding Gas Swaps

 

The table below shows the Group's outstanding gas price swaps that remained subject to fair-value remeasurement at 30 September 2025:

Hedges under the Trafigura Facility as at 30 September 2025:
	Period of Gas Production		Quantity in Therms	Fixed price in pence per Therm
	1-Oct-25	31-Oct-25	1,085,000	90.26
	1-Nov-25	30-Nov-25	1,050,000	90.26
	1-Dec-25	31-Dec-25	1,085,000	90.26
	1-Jan-26	31-Jan-26	620,000	123.08
	1-Feb-26	28-Feb-26	560,000	121.33
	1-Mar-26	31-Mar-26	620,000	115.35
	1- Apr-26	30-Apr-26	600,000	101.53
	1-May-26	31-May-26	620,000	97.27
	1-Jun-26	30-Jun-26	600,000	95.82
	1-Jul-26	31-Jul-26	465,000	95.20
	1-Aug-26	31-Aug-26	465,000	95.85
	1-Sep-26	30-Sep-26	450,000	96.50
	1-Oct-26	31-Oct-26	465,000	92.28
	1-Nov-26	30-Nov-26	450,000	98.16
	1-Dec-26	31-Dec-26	465,000	100.07
			9,600,000

 

Crystallised Hedge Balances

 

During the year, gas price swaps relating to production for May and June 2025 crystallised into fixed cash settlement obligations of £1.365 million. These amounts were fully invoiced by Trafigura but unpaid and are presented within trade and other payables (see Note 23).

 

In addition, the Group had previously crystallised a series of legacy hedge positions in July 2023 into fixed cash settlement obligations with a total value of £4.0 million. At 30 September 2025:

 

·       £3.6 million of this balance had not yet been invoiced by Trafigura and therefore continues to be included within derivative liabilities; and

·       £0.4 million had been invoiced and is included within trade and other payables (see Note 23).

 

Crystallised hedge balances represent fixed cash obligations and are no longer subject to commodity price movements. However, under IFRS 9 they remain classified according to their contractual status: uninvoiced balances continue to be included within derivative liabilities, while invoiced balances are presented within trade and other payables.

 

Interest accrues on both invoiced and uninvoiced crystallised hedge balances at SONIA plus 10%, in accordance with the terms agreed with Trafigura, until settlement.

 

Fair value movements

 

During the year, the Group recognised realised derivative costs of £7.3 million, representing settlement of swap contracts at prices below prevailing market rates.

 

At the reporting date, the fair value of the Group's outstanding swaps resulted in a mark-to-market profit of £1.8 million, reflecting forward gas prices at 30 September 2025. The fair-value movement recognised during the year in profit or loss was £9.1 million.

 

Derivative liability

 

The derivative liability at 30 September 2025 comprises the net fair value of the outstanding swaps together with the uninvoiced crystallised hedge balances, as shown below:

 

Reconciliation of derivative liability				30 Sep 2025
				£'000
Fair value of outstanding swaps (profit)				(1,869)
Uninvoiced crystallised hedge balances (July 2023)				3,649
Total hedge related obligations				1,780

 

 

 

 

Total hedge-related exposure

 

The Group's total hedge-related financial obligations at 30 September 2025 are:

 

Reconciliation of hedge related exposure				30 Sep 2025
				£'000
Derivative liability (Note 22)				1,780
Invoiced crystallised hedges - legacy (July 2023)				413
Invoiced crystallised hedges - May & June 2025				1,365
Total hedge related obligations				3,558

 

 

 

 

 

Future cash flows from outstanding derivatives

 

The table below shows contractual undiscounted cash flows relating only to outstanding derivative instruments (i.e. excluding crystallised hedge balances):

Cash flows from outstanding derivative instruments only		30 Sep 2026	30 Sep 2027	Total
		£'000	£'000	£'000
Net Liability on Swap Contract		2,252	(472)	1,780

 

 

 

 

Valuation methodology

 

Derivatives are measured at fair value using valuation techniques that incorporate observable market inputs, including forward gas price curves and appropriate discounting for credit and liquidity. The derivatives are classified as Level 2 within the fair-value hierarchy.

 

Forward pricing data is sourced from independent market publications, including ICIS Heren, and corroborated against counterparty valuations. Management considers the valuation provided by Trafigura to best represent fair value at the reporting date.

 

Only outstanding derivative instruments are measured at fair value. Crystallised hedge balances are carried at amortised cost.

 

Risk disclosure

 

If gas production volumes are insufficient to meet contracted hedge volumes, swaps may crystallise into fixed cash settlement obligations. This risk, together with the associated liquidity and financing implications, has been considered by the Directors as part of the going-concern assessment (see Note 3.3).

 

The distinction between open derivative positions and crystallised hedge liabilities is fundamental to understanding the Group's exposure to gas price movements, liquidity risk and financing obligations.

 

Subsequent hedging arrangements

 

Subsequent to the reporting date, the Group entered into additional gas hedging arrangements covering production from April 2026 to June 2027. These hedges were placed in accordance with the Group's financing arrangements and are disclosed as a non-adjusting post-balance-sheet event in Note 27.

 

23.    Financial instruments

 

The Group's principal financial instruments comprise cash and cash equivalents, trade and other receivables, derivative instruments, borrowings, lease liabilities and trade and other payables. The Group's accounting policies and methods adopted, including the criteria for recognition and measurement, are set out in Note 3. The Group does not enter into financial instruments for speculative purposes.

 

The principal financial instruments used by the Group, from which financial instrument risk arises, are as follows:

 

 

 

	Financial Assets at amortised cost	Financial Liabilities at amortised cost	Financial Liabilities at fair value through profit or loss	TOTAL
30 September 2025	£'000	£'000	£'000	£'000
Asset
Trade and other receivables	2,514	-	-	2,514
Cash and cash equivalents	1,116	-	-	1,116
Total financial assets	3,630	-	-	3,630
Liabilities
Trade and other payable	-	4,982	-	4,982
Deferred consideration on acquisition of Saltfleetby Energy Limited	-	1,887	-	1,887
Lease liabilities	-	10	-	10
Debt financing	-	18,737	-	18,737
Derivative liability	-	-	1,780	1,780
Total financial liabilities	-	25,616	1,780	27,396
30 September 2024	£'000	£'000	£'000	£'000
Asset
Trade and other receivables	3,374	-	-	3,374
Cash and cash equivalents	2,163	-	-	2,163
Total financial assets	5,537	-	-	5,537
Liabilities
Trade and other payable	-	5,410	-	5,410
Deferred consideration on        acquisition of Saltfleetby Energy Limited	-	2,887	-	2,887
Lease liabilities	-	18	-	18
Debt Financing	-	18,368	-	18,368
Derivative Liability	-	-	10,892	10,892
Total financial liabilities	-	26,683	10,892	37,575

 

 

Trade and other payables

 

Trade and other payables comprise amounts owed to suppliers, joint venture partners, service providers and other counterparties, together with invoiced crystallised derivative settlement balances.

 

At 30 September 2025, trade and other payables included amounts due to Trafigura Group Pte Ltd in respect of crystallised gas price hedge settlements, as follows:

 

Crystallised hedge balances included within trade and other payables

 

During the year, gas price swaps relating to production for May and June 2025 crystallised into fixed cash settlement obligations of £1.3 million. These balances were fully invoiced by Trafigura but remained unpaid at the reporting date and are included within trade and other payables.

 

In addition, a portion of the Group's legacy hedge positions crystallised in July 2023 has also been invoiced. At 30 September 2025, £0.4 million of these legacy crystallised hedge balances had been invoiced and is included within trade and other payables.

These amounts represent fixed contractual obligations that are no longer subject to commodity price movements. Interest accrues on both the May-June 2025 crystallised balances and the invoiced July 2023 balances at SONIA plus 10% until settlement, in accordance with the terms agreed with Trafigura.

 

The remaining £3.6 million of legacy crystallised hedge balances that had not yet been invoiced at the reporting date continues to be classified within derivative liabilities in accordance with IFRS 9 (see Note 22).

 

Capital management

 

The Group manages its capital to ensure that it will be able to continue as a going concern while attempting to maximise the return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Group consists of equity attributable to shareholders and interest-bearing borrowings (see Notes 15 and 21). During the year the Group completed a restructuring of its debt, strengthening liquidity and supporting ongoing operations and development activities.

 

Credit risk

Credit risk is the risk that a counter-party will cause a financial loss to the Group by failing to discharge its obligations to the Group. The Group manages its exposure to this risk by applying limits to the amount of credit exposure to any one counterparty and employs strict minimum credit worthiness criteria as to the choice of counterparty. The maximum exposure to credit risk is represented by the carrying amount of each class of financial asset.

 

Fair values

 

Management has assessed that the fair values of cash and cash equivalents, trade receivables and trade payables approximate their carrying amounts due to their short-term nature.

 

Derivative financial instruments are measured at fair value using valuation techniques based on observable market inputs and are classified as Level 2 within the fair-value hierarchy. Only outstanding swaps are measured at fair value; crystallised hedge balances are carried at amortised cost (see Note 22).

 

      Interest rate risk

 

The Group finances its operations through a combination of equity and interest-bearing debt. The Group exposure to changes in interest rates relates primarily to cash at bank, loan facility and amount owed by related parties. Cash is held either on current or short term deposits at a floating rate of interest determined by the relevant bank's prevailing base rate.

 

Interest rate sensitivity

 

The following table demonstrates the sensitivity to reasonably possible changes in the interest add-on rate for the Trafigura Senior Loan with the principal interest rate held constant at 8% (see Note 21). The Group finances its operations through a combination of equity and interest-bearing debt. 

 

 

		Increase / (decrease)
Increase/decrease in add-on Interest rate		30 September
		2025		2024
		£		£
+ 10%		89		103
-  10%		(89)		(103)

     

      Foreign currency exchange risks

 

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of the changes in foreign exchange rates. The Group's exposure to the risk of changes in foreign exchange rates relates primarily to the Group's operating activities (when revenue or expense is denominated in a foreign currency).

 

The Group does not hedge its foreign currencies. Transactions with customers regarding oil sales are denominated in US Dollars. The Group has bank accounts in US Dollars to mitigate against the exchange risks, which is very minimal to its value. At 30 September 2025, the GBP equivalent of US-dollar-denominated cash balances was £2,182 (2024; £113,621).

 

                Liquidity risks

 

The principal risk to the Group is liquidity, which arises from the Group's management of working capital. It is a risk that the Group will encounter difficulty in meeting its financial obligations as they fall due. This aspect is kept under review by the directors and in this respect, management carries out rolling 12-month cash flow projections on a monthly basis as well as information regarding cash balances. The Group's liquidity management aims to ensure sufficient resources are available to meet liabilities as they fall due, including debt service obligations and derivative settlement payments.

 

Liquidity risk - derivatives

 

The maturity profile of derivative liabilities reflects only open derivative contracts that remain subject to fair-value remeasurement. Crystallised hedge balances that have been invoiced are included within trade and other payables, while uninvoiced crystallised balances remain included within derivative liabilities until invoicing (see Note 22).

 

This explains why the derivative maturity table for 2025 shows only £1.7 million beyond 12 months - this represents the net fair value of outstanding swaps and uninvoiced crystallised balances, not the full hedge-related exposure.

 

The maturity profile of the Group's financial liabilities at the reporting dates based on contractual undiscounted payments are summarised below:

 

			2025		2024
			£'000		£'000
Trade and other payable
Within one month			2,388		2.508
Within two to three months			3,648		2,459
Within four to twelve months			3,142		3,330
			9,178		8,297
			2025		2024
			£'000		£'000
Lease liabilities
Within one month			10		-
Within two to three months			10		-
Within four to six months			10		18
Within six to twelve months			10		-
More than twelve months			100		-
			140		18
			2025		2024
			£'000		£'000
Loan liabilities
Within one month			-		-
Within two to three months			-		-
Within four to six months			415		2,552
Within six to twelve months			830		3,680
More than twelve months			20,415		19,945
			21,660		26,177
*The table included estimate on interest for the loan duration
			2025		2024
			£'000		£'000
Derivative liabilities
Within one month			-		1,518
Within two to three months			-		2,347
Within four to six months			-		3,468
Within six to twelve months			-		3,369
More than twelve months			1,780		190
			1,780		10,892

         

          Commodity price risk

 

The Group is exposed to the risk of fluctuations in prevailing market commodity prices of oil and gas products it produces. The table below summarised the impact on profit before tax for changes in commodity prices

 

          Commodity price sensitivity

 

The sensitivity analysis shows the impact on profit before tax of a 10% change in commodity prices, assuming all other variables remain constant, including production volumes, operating costs and hedging arrangements. Reasonably possible movements in commodity prices were determined based on a review of the average spot prices at each reporting periods.

 

Increase/decrease in crude oil prices		Increase / (decrease) in profit before tax for the year ended 30 September
		2025		2024
		£'000		£'000
Average spot price increased by 10%		56		16
Average spot price decreased by 10%		(56)		(16)

 

 

Increase/decrease in condensate oil prices		Increase / (decrease) in profit before tax for the year ended 30 September
		2025		2024
		£'000		£'000
Average spot price increased by 10%		94		158
Average spot price decreased by 10%		(94)		(158)

 

 

 

 

Increase/decrease in gas prices		Increase / (decrease) in profit before tax for the year ended 30 September
		2025		2024
		£'000		£'000
Average spot price increased by 10%		1,656		2,008
Average spot price decreased by 10%		(1,656)		(2,008)

24.          Net debts reconciliation

 

The Group defines net debt as cash and cash equivalents less interest-bearing borrowings and deferred consideration. It excludes trade and other payables, lease liabilities and crystallised derivative settlement balances, which are presented separately in Note 19.

		2025		2024
		£'000		£'000
Cash and cash equivalent (Note 14)		1,116		2,163
Loan payable (Note 21)		(18,737)		(18,368)
Deferred consideration on Saltfleetby Energy Limited acquisition (Note 19)		(1,887)		(2,887)
Net debt		(19,508)		(19,092)

 

 

	Cash and cash equivalents	Loans	Bridge Loans	Deferred consideration on acquisition of SEL	Total
	£'000	£'000	£'000	£'000	£'000
Net debt as at 1 October 2023	2,172	(7,213)	(9,000)	(5,244)	(19,285)
Cash flow	(3,117)	-	-	-	(3,117)
Loan settlement (equity)	-	-	3,000	-	3,000
Trafigura Loan	14,885	(14,885)	-	-	-
Deferred consideration payment	(2,357)	-	-	2,357	-
Facility Loan repayment	(8,872)	2,872	6,000	-	-
Transaction cost paid	(548)	548	-	-	-
Transaction cost off set the loan proceeds	-	526	-	-	526
Amortisation of finance cost	-	(216)	-	-	(216)
Net debt as at 30 September 2024	2,163	(18,368)	-	(2,887)	(19,092)
Net debt as at 1 October 2024	2,163	(18,368)	-	(2,887)	(19,092)
Cash flow	(1,047)	-	-	-	(1,047)
Deferred consideration (equity)	-	-	-	1,000	1,000
Transaction cost off set the loan proceeds	-	(369)	-	-	(369)
Amortisation of finance cost	-	-	-	-	-
Net debt as at 30 September 2025	1,116	(18,737)	-	(1,887)	(19,508)

 

 

      Reconciliation and interaction with other liabilities

 

At 30 September 2025, the Group also had significant hedge-related and other contractual obligations that are not included in net debt, as they are presented within trade and other payables or derivative liabilities in accordance with IFRS:

·      Invoiced crystallised hedge balances of £1.7 million (Note 22 and Note 19);

·      Uninvoiced crystallised hedge balances of £3.6 million included within derivative liabilities (Note 22);

·      Overriding Royalty Interest ("ORRI") payable of £1.2 million (Note 19).

 

These balances were subject to restructuring after the reporting date and are therefore excluded from net debt at 30 September 2025 but disclosed as post-balance-sheet events in Note 27.

 

25.          Commitments

 

At 30 September 2025, the Group had no material contractual capital commitments (2024: Nil).

 

The Group's future development activities at the Saltfleetby Gas Field and other assets are subject to Board approval and the availability of funding and therefore no binding capital expenditure commitments had been entered into at the reporting date.

 

26.          Related Party transactions

 

Forum Energy Services Limited ("Forum") is a related party by virtue of being both a substantial shareholder of the Company and being represented on the Board through Richard Glass, a Non-Executive Director of the Company.

 

Forum was the vendor of Saltfleetby Energy Limited to the Group in 2022 and remains a creditor of the Group through deferred consideration payable under the share purchase agreement.

 

At 30 September 2025, amounts owed to Forum were:

		2025		2024
		£'000		£'000
Deferred consideration payable		(1,887)		(2,887)

 

 

These balances are included within trade and other payables (see Note 19). During the year, the Company issued ordinary shares with a value of approximately £1.0 million in partial settlement of the deferred consideration, reducing the outstanding balance.

 

Subsequent to the year end, the Company has been progressing discussions regarding the restructuring of the deferred consideration. Further details are disclosed in Note 27.

 

Aleph Commodities Limited

 

Aleph Commodities Limited ("Aleph") is a related party by virtue of being a substantial shareholder in the Company and through Alexander Craig, a Non-Executive Director of the Company and a partner and co-founder of Aleph.

 

Aleph held an economic interest in the Overriding Royalty Interest ("ORRI") attached to the Saltfleetby Gas Field. At 30 September 2025, amounts payable in respect of the ORRI totalled £1.2 million (2024: £0.4 million), which are included within trade and other payables (see Note 19).

 

27.          Events after the reporting period

 

Subsequent to the reporting date, the Company has been progressing the refinancing and restructuring of its financing arrangements with Trafigura Group Pte Ltd ("Trafigura"), the counterparties to the Overriding Royalty Interest ("ORRI") attached to the Saltfleetby Gas Field, and Forum Energy Services Limited in respect of the deferred consideration relating to the acquisition of Saltfleetby Energy Limited. The Company has reached agreement on the key commercial terms of the proposed restructuring and is currently working with the relevant parties and its advisers to finalise the definitive documentation required to implement these arrangements.

 

On 9 March 2026, the Group entered into additional gas hedging arrangements covering production from April 2026 to June 2027. These hedges secure approximately 7.745 million therms at an average weighted price of approximately 101 pence per therm and were placed in accordance with the Group's financing arrangements and gas price risk management strategy.