Corporate | 3 June 2014 08:30
Deutsche Rohstoff AG / Key word(s): Strategic Company Decision/Final Results
03.06.2014 08:30
Dissemination of a Corporate News, transmitted by DGAP - a company of EQS
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Deutsche Rohstoff AG: New focus after closing of Tekton transaction
Divestment of Wolfram Camp planned/Group financial accounts online
Heidelberg. After the final closing of divestments of the major assets of
Tekton Energy last week Deutsche Rohstoff plans to realign its current
activities. In the near future the focus of investments will be on the
development of US oil & gas assets. The management of Deutsche Rohstoff is
convinced of the good opportunities for very profitable investments with a
short payback period for invested capital. The sale of the Windsor project
generated a return on equity before tax of 365% within just three years.
Cash and cash equivalents in the group after the sale amount to EUR 135
million. In the course of the realignment of activities the management has
also decided to sell the Wolfram Camp mine. For some weeks Deutsche
Rohstoff has been in negotiations with an interested party which may lead
to a near term transaction.
Revenues in 2013 increased to EUR 17.8 million (previous year EUR 3.1
million). Tekton Energy contributed to revenues with EUR 9.0, Wolfram Camp
with EUR 8.6 million. Earnings before tax, interest and depreciation
(EBITDA) adjusted for the cost of issuing the corporate bond (EUR 2.0
million) was EUR 3.9 million (previous year EUR 2.3 million). For the
assets of Wolfram Camp and respectively Tropical Metals the company
accounted for an extraordinary impairment in 2013 of EUR 4.4 million in the
group accounts and EUR 10 million in the in the accounts of Deutsche
Rohstoff AG as a parent. The main reason for the impairment is that due to
the experiences with mining and processing as well as highly volatile
tungsten prices and exchange rates the expected future cash flows are below
previously targeted levels. Furthermore a sale below book value may not be
avoided. Due to the planned depreciation and the impairment amounting to
EUR 7.3 million net income for the group resulted in EUR -7.65 million
(previous year EUR 2.3 million).
The balance sheet sum grew to EUR 131.5 million (previous year 63.4
million). Non-current assets, which primarily reflect investments in Tekton
Energy and Wolfram Camp, grew to EUR 70.4 million and therefore accounts
for 54 % of the balance sheet total. Cash at year's end amounted to EUR
39.8 million. Due to the negative net income and the adjustment of currency
losses equity capital was reduced to EUR 38.9 million (previous year EUR
48.9 million).
The impairment of Wolfram Camp and the one time cost of issuing a corporate
bond caused Deutsche Rohstoff AG as a parent to obtain a net loss for the
year of EUR -12.1 million (previous year gain of EUR 3.8 million). Due to
the net loss the company has no distributable capital reserves and in
accordance with German commercial law and Stock Corporation Act will
therefore not be able to distribute a dividend payment to shareholders
other than originally planned despite very high liquidity. Instead the
management of Deutsche Rohstoff plans to establish a share buyback program
during the course of the year.
The group accounts of Deutsche Rohstoff, including the group management
report can be downloaded on the company's website (in German). The German
Annual Report 2013 and individual financial statements of Deutsche Rohstoff
AG will be published by Friday.
Deutsche Rohstoff furthermore announced the foundation of an additional
subsidiary specialized in the development of US oil & gas assets- Cub Creek
Energy, LLC, also located in Denver. Co-founders of Cub Creek Energy are
Tekton's current Vice President of Engineering, Robert Gardner, and the
Vice President Land & Business Development, Scott Baily, as well as Dan
Berberick, a experienced Rocky Mountain Petroleum Geologist with extensive
experience in the targeted areas. Robert Gardner will take on the role of
President & CEO. Titus Gebel, Thomas Gutschlag and the current President &
CEO of Tekton Energy, Jerry Sommer, will represent Deutsche Rohstoff on the
board of the company. Earl Norris will also consult Cub Creek with his
extraordinary experience. The new management team combines several decades
of experience in the U.S. oil & gas industry and has significantly
contributed to the success of Tekton Energy.
The company will have an initial focus on Colorado (Wattenberg), Utah and
North Dakota, states in which the management team have previously worked
and therefore gathered extensive operational experience. Deutsche Rohstoff
AG holds a 74% majority stake in the new company. The remaining shares are
held by management, which will contribute to the financing of the company.
Cub Creek is positioned to license acreage and begin development activities
in the course of the year.
Titus Gebel, CEO of Deutsche Rohstoff, said: "We are willing to repeat the
great success of Tekton with this new company, Cub Creek Energy. During our
cooperation with Tekton Energy we were able to convince ourselves of the
excellent skills and experience that the Cub Creek Energy management team
brings to the new company. First possible transactions are currently being
evaluated."
After the sale of its major assets Tekton Energy currently remains financed
with USD 1.5 million that serve as a coverage amount for potential
liabilities from final adjustments to the closing price. Furthermore the
company holds property that can be used for industrial purposes as well as
the remaining 560 acres in the so-called "Magpie" area south of Windsor.
Extraction Oil & Gas, which acquired the major assets of Tekton last week,
holds an option to take over this acreage for another USD 60 million. Due
to the uncertainty about the exercising of the option the further
acquisition of acreage, also in the Wattenberg field, will only be carried
out by Cub Creek.
Tekton Energy will be renamed to "Elster Oil and Gas" within the next days.
The Management will be identical to Cub Creek Energy, with Robert A.
Gardner serving as President & CEO. The co-founders Jerry Sommer and Earl
Norris will sell their shares to Deutsche Rohstoff USA which will increase
its ownership to 93% of the company, the remaining shares will be held by
the Management team. In addition to their consulting capacity to Cub Creek
and after a break in their activities the successful co-founders of Tekton
will consider establishing a new project together with Deutsche Rohstoff.
Heidelberg, 03 June 2014
Deutsche Rohstoff (Heidelberg, Germany), listed in the Entry Standard
segment of Frankfurt Stock Exchange, is establishing a new primary
producer. The company's focus is placed on oil & gas and so called high
tech metals such as tin, tungsten, and rare earth metals. All projects are
located in political stable countries with high environmental standards.
The business concept is based on redeveloping deposits, which have been
well explored in the past. For more information please visit
www.rohstoff.de.
Contact:
Deutsche Rohstoff AG
Thomas Gutschlag
Tel. +49 6221 871 000
info@rohstoff.de
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Language: English
Company: Deutsche Rohstoff AG
Friedrich-Ebert-Anlage 24
69117 Heidelberg
Germany
Phone: 06221-87100-11
Fax: 06221-87100-22
E-mail: gutschlag@rohstoff.de
Internet: www.rohstoff.de
ISIN: DE000A0XYG76, DE000A1R07G4,
WKN: A0XYG7, A1R07G
Indices: Entry Standard (Performance TOP 30)
Listed: Freiverkehr in Berlin, Düsseldorf, Stuttgart; Frankfurt in
Open Market (Entry Standard)
End of Announcement DGAP News-Service
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