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Hardy Oil & Gas - Half-year Report

Hardy Oil and Gas plc (LSE: HDY), the oil and gas exploration and production company, reports its results for the six months ended 30 September 2019 (H1FY20).


All financial amounts are stated in US dollars unless otherwise indicated.


SUMMARY


Activity during the six months ended 30 September 2019


·      CY-OS/2 - The Supreme Court of India allowed the Government of India's ("GOI") appeal of an arbitration award to be appealed in the Delhi High Court. The appeal is projected to take several more years to conclude. Actions to enforce the award in foreign jurisdictions were unsuccessful.

·      PY-3 - the GOI did not agree to convene a Management Committee meeting to discuss and ratify an application to a development plan and extension to the production sharing contract. An arbitration with the PY-3 non-operating partners had concluded but the ruling of the tribunal had been continuously delayed.


Financial


·       The Group's total comprehensive loss was $0.3 million for the H1FY20 compared to a loss of $54.1 million for first half of FY19 (H1FY19) wherein CY-OS/2 was written down by $51.1 million.

·       Cash and short-term investments at 30 September 2019 excluding discontinued operations was $3.1 million; Hardy has no debt.

·       Discontinued operations - current assets and current liabilities of the discontinued operations were $12.9 million and $14.7 million respectively.


Post half year end highlights


·        2 October 2019, the Company disposed of its oil and gas assets via the sale of wholly owned subsidiary Hardy Exploration & Production (India) Inc. (HEPI) to Invenire Energy Private Limited for gross consideration of $8.75 million.

·        18 October 2019, Richard Galvin was appointed Executive Director of the Company and Ian MacKenzie resigned as Chief Executive Officer.

·        25 November 2019, Blake Holdings Limited announced a Mandatory Offer of 5 pence per share for the shares of the Company valuing the Company at approximately $4.8 million. The Board recommended shareholders take no action pending the publication of the offer document.

·        As at 30 November 2019 the Company had $10.5 million in cash and short-term investments.


OUTLOOK


·      Focus on acquiring or establishing a company, business or asset that operates in the resources sector or other industries.

·      The Board intends to seek shareholder approval regarding investment opportunities prior to action being taken


Alasdair Locke, Chairman of Hardy, commented: "Hardy's board of directors (the "Board") will be writing to shareholders as soon as practicable with its formal response to the Mandatory Offer once Blake has posted the offer document. Further announcements will be made as and when appropriate. In the meantime, the Board recommends that shareholders should take no action."

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