Altona Energy swung into the black in the year to the end of June posting a profit of £38,000 compared with a loss of £1,312,000 last time.
The group said this was principally created by two non-cash credits to the income statement. The first followed the confirmation from HMRC that its enquires, in relation to potentially underpaid tax estimated at approximately £790,000 concerning fees paid on a gross basis to a company controlled by a previous board member, have concluded with the company having no outstanding liabilities to HMRC in the matter. Accordingly the company has released the provision in full resulting in a non-cash credit to the income statement.
Eliminating this non-cash entry results in an adjusted loss for the year ended 30 June 2016 of £765,000 (2015: loss of £1,312,000).
This was in line with expectations having initiated cost cutting initiatives during the year that were planned to ensure shareholder's funds stretch as far as possible.
As at 30 June 2016, the Group had cash of £362,000 (2015: £543,000).
In addition to the cost cutting initiatives undertaken in the year, the Group has reviewed its cost base and has cut further cost from the business in order to allow the Group to continue to meet its obligations whilst it secures the necessary PEL. The impact of these cost cutting measures is expected to result in a business that is appropriately structured to continue to control and influence its interest in the activities of the joint venture project.
Chairman Qinfu Zhang said: "The 12 months under review was a period of mixed fortunes for the Company, with a number of important milestones reached, offset against the delay caused by the need for the JV Company to obtain a Petroleum Exploration Licence before work can commence at the Arckaringa Project. The JV Company submitted the relevant application after the year end on 17 October 2016.
"The Company's main investment in the Arckaringa Basin, South Australia, remains a world class coal asset, exceeding 7.8 billion tonnes of coal (1.3 billion tonnes JORC compliant) and the Company, along with Sino-Aus and Wintask continue to have the support of The Honourable Tom Koutsantonis MP, the South Australian Minister for Mineral Resources and Energy, and Minister for State Development.
"The past 12 months have been focused on securing adequate funding for the project and by engaging with the appropriate experts who will work alongside the JV Company to ensure a timely delivery of the test drilling programme and bankable feasibility study, once all approvals are received from the South Australian Government."