Consolidated Statement of Income
For the six months ended 30 June 2014
Six months Six months
ended ended Year ended
30 Jun 2014 30 Jun 2013 31 Dec 2013
Unaudited Unaudited Audited
Note US$ US$ US$
Continuing operations
Revenue 9,259,239 11,643,218 30,551,967
Cost of sales (5,209,706) (7,737,486) (21,259,292)
Gross profit 4,049,533 3,905,732 9,292,675
Administrative expenses (2,794,382) (2,293,916) (4,366,937)
Operating profit before depreciation 1,255,151 1,611,816 4,925,738
Depreciation (524,338) (298,400) (685,173)
Operating profit 730,813 1,313,416 4,240,565
Net Financial Income 167,100 72,922 721,227
Profit before taxation 897,913 1,386,338 4,961,792
Taxation (160,233) (358,632) (575,722)
Profit for the financial period 737,680 1,027,706 4,386,070
Attributable to:
Equity shareholders of the parent 737,680 1,027,706 4,285,931
Non-controlling interest - - 100,139
737,680 1,027,706 4,386,070
Earnings per share - US$ (using weighted average
number of shares
Basic (US$) 3 0.03 0.07 0.26
Diluted (US$) 3 0.03 0.07 0.26
Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2014
Six months Six months
ended ended Year ended
30 Jun 2014 30 Jun 2013 31 Dec 2013
Unaudited Unaudited Audited
US$ US$ US$
Profit for the financial period 737,680 1,027,706 4,386,070
Other comprehensive income:
Exchange differences on re-translation
of foreign operations 1,970 (39,119) 197.185
Unrealised gains on available for sale investments 19,828 - -
Total comprehensive income 759,478 988,587 4,583,255
Attributable to:
Equity shareholders of the parent 759,478 988,587 4,483,116
Non-controlling interest - - 100,139
Total comprehensive income 759,478 988,587 4,583,255
Consolidated Statement of Financial Position
At 30 June 2014
At At At
30 Jun 2014 30 Jun 2013 31 Dec 2013
Unaudited Unaudited Audited
US$ US$ US$
ASSETS
Non-current assets
Goodwill 368,525 368,525 368,525
Intellectual Property 2,907,572 - 2,870,043
Property, plant and equipment 13,382,023 7,591,232 8,153,119
Computer Software 254,089 - -
Multi-Client Library 472,618 - -
Available for sale investments 58,503 38,675 38,675
Total non-current assets 17,443,330 7,998,432 11,430,362
Current assets
Inventory 877,928 1,446,000 690,008
Loans 7,256,904 763,000 1,885,583
Trade and other receivables 11,298,462 5,239,580 7,078,753
Cash and cash equivalents 21,213,030 16,837,567 32,235,155
Total current assets 40,646,324 24,286,147 41,889,499
LIABILITIES
Current liabilities
Trade and other payables 5,561,221 3,787,841 2,084,595
Deferred revenue - 9,369,196 -
Total current liabilities 5,561,221 13,157,037 2,084,595
Net current assets 35,085,103 11,129,110 39,804,904
Net assets 52,528,433 19,127,542 51,235,266
EQUITY
Shareholders Equity
Share capital 250,675 178,175 250,575
Share premium 44,866,060 16,332,196 44,668,608
Treasury shares - (384,226) (279,982)
Other reserves 199,334 (58,768) 177,536
Retained earnings 7.066.020 3,013,960 6,272,185
Total Shareholders Equity 52,382,089 19,081,337 51,088,922
Non-controlling interest 146,344 46,205 146,344
Total Equity 52,528,433 19,127,542 51,235,266
These financial statements were approved by the board on 15 September 2014.
Consolidated Statement of Cash Flows
For the six months ended 30 June 2014
Six months Six months
ended ended Year ended
30 Jun 2014 30 Jun 2013 31 Dec 2013
Unaudited Unaudited Audited
US$ US$ US$
Cash flows from operating activities
Operating Profit for the period before depreciation 1,255,151 1,611,816 4,925,738
Shares issued to Chairman1 - 440,000 -
Increase in inventory (187,920) (1,364,223) (608,231)
Increase in trade and other receivables (4,219,708) (4,611,502) (6,450,675)
Increase in trade and other payables 3,739,342 2,991,998 2,623,293
Increase in deferred revenue - 9,369,196 -
Increase in multi client library (472,619) - -
Net Foreign Exchange (gain) / loss (131,358) (188,998) (1,109,570)
Taxation (160,233) (358,632) (69,119)
Cash (used in) / generated from operations (177,345) 7,889,655 (688,564)
Interest paid (17,922) (155,248) (166,749)
Net cash flow from operating activities (195,267) 7,734,407 (855,313)
Cash flows from investing activities
Disposal of Assets 3,883 - -
Acquisition of intellectual property (37,529) - (2,913,201)
Interest received 107,907 53 30,958
Purchase of equipment (5,753,242) - (941,278)
Purchase of computer software (254,089) (35,776) -
Loan to THAL Discretionary Trust (4,902,534) - (1,885,583)
Net cash flow from investing activities (10,835,604) (35,723) (5,709,104)
Cash flows from financing activities
Exercise of Options 8,746 6,656,414 35,366,920
Disposal of Treasury Shares - - 950,183
Net cash flow from financing activities 8,746 6,656,414 36,317,103
Net (decrease) / increase in cash and cash equivalents (11,022,125) 14,355,098 29,752,686
Cash and cash equivalents at the start of the period 32,235,155 2,482,469 2,482,469
Cash and cash equivalents at the end of the period 21,213,030 16,837,567 32,235,155
1 Includes non cash transactions regarding the shares issued to the Chairman in 2013 in satisfaction of consultancy and administrative services.
Consolidated Statement of Changes in Equity
For the six months ended 30 June 2014
Retained Total
Share Share Treasury Other earnings/ Shareholders Minority Total
Capital Premium shares Reserves (losses) Equity Interest Equity
US$ US$ US$ US$ US$ US$ US$ US$
Balance as at
1 January 2013 133,175 8,517,782 (384,226) (19,649) 1,986,254 10,233,336 46,205 10,279,541
Issue of Ordinary
Share Capital 45,000 8,181,429 - - - 8,226,429 - 8,226,429
Placing fees - (367,015) - - - (367,015) - (367,015)
Total comprehensive
income for the period - - - (39,119) 1,027,706 988,587 - 988,587
Balance as at
30 June 2013 178,175 16,332,196 (384,226) (58,768) 3,013,960 19,081,337 46,205 19,127,542
Issue of Ordinary
Share Capital 72,400 27,490,473 - - - 27,562,873 - 27,562,873
Placing fees - 845,939 104,244 - - 950,183 - 950,183
Total comprehensive
income for the period - - - 236,304 3,258,225 3,494,529 100,139 3,594,668
Balance as at
31 December 2013 250,575 44,668,608 (279,982) 177,536 6,272,185 51,088,922 146,344 51,235,266
Shares issued on
exercise of options 100 8,647 - - - 8,747 - 8,747
Share Options Expense - - - - 56,155 56,155 - 56,155
Sale of Treasury Shares - 188,805 279,982 - - 468,787 - 468,787
Total comprehensive
income for the period - - - 21,798 737,680 759,478 - 759,478
Balance as at
30 June 2014 250,675 44,866,060 - 199,334 7,066,020 52,382,089 146,344 52,528,433
Notes to the Consolidated Interim Financial Information
1. General information
Thalassa Holdings Ltd (the "Company") is a British Virgin Island ("BVI") International business company ("IBC"), incorporated and registered in the BVI on 26 September 2007. The Company was established as a holding company, and currently has two operating subsidiaries, WGP Group Ltd ("WGP") and GO Science Group Ltd ("GO")(together with Thalassa Holdings Ltd, the "Group").
WGP Group Ltd is a wholly owned subsidiary of Thalassa which owns the seismic operating assets of the Thalassa Group and whose subsidiaries are:
• WGP Energy Services Ltd ("WESL")
• WGP Exploration Ltd ("WGPE")
• WGP Technical Services Ltd ("WGPT")
• WGP Professional Services Ltd ("WGPP")
• WGP Survey Ltd ("WGPS")
GO Science Group Ltd is a wholly owned subsidiary of Thalassa and is an AUV research and development company with one subsidiary:
• Autonomous Robotics Limited (formally GO Science 2013 Ltd)
The Group's interest in each of the subsidiaries is 100%, other than WGPS, where it owns 50%.
The Company also has a newly incorporated subsidiary, WGP Geosolutions Limited which has an additional subsidiary, WGP Group GmbH, both currently non-operational.
2. Significant Accounting policies
The Group prepares its accounts in accordance with applicable International Financial Reporting Standards ("IFRS") as adopted by the EU.
The accounting policies applied by the Company in this unaudited consolidated interim financial information are the same as those applied by the Company in its consolidated financial statements as at and for the period ended 31 December 2013 except for the following which are new for this period:
Revenue Recognition
Multi Client Library
Pre-funded revenues from underwritten programmes are recognised as the seismic data is acquired. Where the Group has finished data sets ready for sale, revenue is recognised at the time of the transaction when the customer executes a valid license agreement and has the right to access the licensed portion of the Multi Client library.
Intangible Assets
Multi Client Library
The Multi-Client library comprises completed surveys and surveys in progress that can be licensed to multiple customers. All direct costs related to data collection, processing and completion of seismic surveys are capitalised. The Multi-Client library is capitalised at cost less accumulated amortisation and impairment losses. The Company has a minimum amortisation policy whereby the carrying amount one year after completion of a survey is no more than 60% of cost. This maximum level is reduced on a straight-line basis by 20% points for each of the three subsequent years.
Estimated revenues are reviewed continuously and these may change to reflect market conditions. The amortisation expense of the Multi-Client library may fluctuate and be accelerated according to the level of revenue and revisions to estimated remaining revenues. Where amortisation expense is accelerated it is calculated as the proportion of the total cost of a survey calculated according to the proportion of cumulative revenues for the survey to the estimated total revenue for the survey. The costs of a survey are completely amortised when the estimated revenue has been reached.
2.1. Basis of preparation
The condensed consolidated interim financial information for the six months ended 30 June 2014 has been prepared in accordance with International Accounting Standard No. 34, 'Interim Financial Reporting'. They do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Company as at and for the period ended 31 December 2013.
All intra-group transactions, balances, income and expenses are eliminated in full on consolidation.
2.2. Going concern
The financial information has been prepared on the going concern basis as management consider that the Group has sufficient cash to fund its current commitments for the foreseeable future.
3. Earnings per share
Six months Six months Year
ended ended ended
30 Jun 2014 30 Jun 2013 31 Dec 2013
Unaudited Unaudited Audited
The calculation of earnings per share is based on the
following profit and number of shares:
Profit for the period (US$) 737,680 1,027,706 4,285,931
Weighted average number of shares of the Company:
Basic 25,040,757 13,730,522 16,352,316
Share Options 333,123 183,045 215,480
Diluted 25,373,880 13,913,567 16,567,796
Earnings per share:
Basic (US$) 0.03 0.07 0,26
Diluted (US$) 0.03 0.07 0,26
4. Loans and receivables
30 Jun 2014 30 Jun 2013 31 Dec 2013
Unaudited Unaudited Audited
US$ US$ US$
Loans and receivables 7,256,904 763,000 1,885,583
Loans and receivables includes a loan of US$7,117,025 plus accrued interest of US$139,879 to the THAL Discretionary Trust. Interest is payable at 3% per annum (reviewed periodically to keep in line with market rates).
The THAL Discretionary Trust is a trust, independent of Thalassa, established for the benefit of individuals or parties to whom the Trustees wish to make awards at their discretion.
On January 8 2014, the Trust acquired:
• 1,000,000 ordinary shares in the Company at £2.70 per share,
• 1,078,667 ordinary shares in the Company at £0.264 per share.
The above transactions were financed by a loan from the Company.
5. Related party balances and transactions
Under the consultancy and administrative services agreement entered into on 23 July 2008 with a company in which the Chairman has a beneficial interest, the Group was invoiced US$220,000 for consultancy and administrative services provided to the Group including US$100,000 of consultancy fees. An additional US$2,000 of Director fees were also invoiced to the Group. At 30 June 2014 the amount owed to this company was US$148,517 (1H13: US$2,000).
As per the announcement on 8 January 2014, the Chairman sold 1,000,000 ordinary shares of US$0.01 each in the Company at a price of 270 pence per share to the THAL Discretionary Trust.
As per the announcement on 8 January 2014, the Company sold 1,078,667 Ordinary Shares out of treasury to the THAL Discretionary Trust at a price of £0.264 per ordinary share.
To finance these purchases by the THAL Discretionary Trust, the Company provided a loan of £3,054,768 to the THAL Discretionary Trust (US$5,201,659).
Under a consultancy agreement entered into on 6 November 2013, a company in which Mr Robert Anderson has a beneficial interest, invoiced the Group US$25,005 (1H 2013: US$nil) in relation to consultancy fees and expenses. The amount owed to this company as at 30 June 2014 was US$4,150 (1H 2013: US$nil).
6. Share capital and share premium
As at As at
30 Jun 2014 31 Dec 2013
US$ US$
Authorised share capital:
100,000,000 ordinary shares of $0.01 each 1,000,000 1,000,000
Allotted, issued and fully paid: 250,575 250,575
Number of
Number of Treasury Treasury
shares Shares shares
Balance at 31 December 2013 25,057,522 1,078,667 (279,982)
Shares issued 10,000 - -
Shares sold - (1,078,667) 279,982
Balance at 30 June 2014 25,067,522 - -
7. Post balance sheet events
No material events to report.
8. Copies of the Interim Report
The interim report is available on the Company's website: www.thalassaholdingsltd.com.
