atlas development and support services listing statement

Listing Statement GROWTH ENTERPRISE MARKET SEGMENT NAIROBI SECURITIES EXCHANGE NOMINATED ADVISOR Burbidge Capital

Table of Contents

Important Notice i

Chairman’s Statement iii

Corporate Information iv

Glossary of Definitions and Abbreviations vii

1. KEY FEATURES OF THE TRANSACTION 1

2. ECONOMIC OVERVIEW 5

3. OVERVIEW OF THE KENYA EQUITY MARKET 13

4. OVERVIEW OF THE NATURAL RESOURCES SECTOR IN EAST AFRICA AND THE OPPORTUNITY FOR PROFESSIONAL SUPPORT SERVICES PROVIDERS 14

5. THE BUSINESS 16

6. OPERATIONAL AND FINANCIAL REVIEW 31

7. KEY RISK FACTORS 38

8. STATUTORY AND GENERAL INFORMATION 49

9. DIRECTORS’ STATEMENT 59

APPENDIX 1: LEGAL OPINION 60

APPENDIX II: INTRODUCTION TO FINANCIALS 64

APPENDIX III: REPORTING ACCOUNTANT’S REPORT 65

1. REPORT OF THE ACCOUNTANTS 66

2. ACCOUNTING POLICIES 68

3. FINANCIAL INFORMATION 71

(i) Consolidated income statement 71

(ii) Consolidated Statement of Comprehensive income 72

(iii) Consolidated Statement of Financial Position 73

(iv) Pro-forma Balance Sheet Following Private Placement 74

(v) Consolidated Statement of Changes in Equity 75

(vi) Consolidated Cash Flow Statement 76

4. NOTES TO THE FINANCIAL STATEMENTS 77

Nominated Advisor Burbidge Capital4th Floor Nivina TowersWestlands Road, Museum Hill, Westlands,P.O. Box 51525 – 00100Nairobi, KenyaTel: +254 (0) 202 100 102

Legal Advisors Anjarwalla & KhannaThe Oval, 3rd FloorWestlandsP.O. Box 200-00606, Sarit CentreNairobi, Kenya

Reporting Accountants Baker Tilly Merali’s 1st Floor, New Rehema House, Rhapta Road, WestlandsP.O. Box 67486, 00200Nairobi, Kenya

Registrar (Kenya) The Central Depository & Settlement Corporation Limited (CDSC) Nation Centre, 10th FloorKimathi Street P.O. Box 3464-00100 GPO Nairobi

Registrar (UK) Capita Asset Services 40 Dukes Place London EC3A 7NH United KingdomTel: +44 (0) 20 7397 6264

Public Relations (Kenya) Levanter Africa2nd Floor Bravo BlockWilson Business ParkP.O. Box 8541, 00200, Nairobi, Kenya

Public Relations (UK) St Brides Media & Finance3 St Michael’s AlleyLondon EC3V 9DSUnited Kingdom

Important Notice

THIS DOCUMENT CONTAINS IMPORTANT INFORMATION FOR CONSIDERATION AND REQUIRESCAREFUL ATTENTION AS IT INCLUDES WITHIN IT, LEGAL, MARKET AND HISTORIC AND CURRENTFINANCIAL INFORMATION.

This Listing Statement includes particulars given in compliance with the requirements of the Companies Act2001 (Cap.486), the requirements of the Capital Markets Act (Cap. 485A), The Capital Markets (Securities)(Public Offers, Listing and Disclosures) Regulations 2002 and, the rules and regulations made thereunder,as well as the rules contained in the Nairobi Securities Exchange (“NSE”) listing rules, in particular, the NSEListing Manual.

This Listing Statement is issued by Atlas Development & Support Services Limited (“ADSS” or “the Issuer”)and has been prepared in compliance with The Capital Markets (Securities) (Public Offers, Listing andDisclosures) Regulations 2002 in connection with the proposed cross listing of the whole of its existingissued share capital (“Shares”) on the Official List of the NSE by way of Introduction (“Introduction”) in theGrowth Enterprise Market Segment (“GEMS”) of the NSE.

Application is being made to the NSE for the listing of the Shares on the NSE. Subject to compliance withthe NSE Listing Manual, the NSE will admit the Shares for listing under the security code “ADSS” in theGEMS. As a matter of policy, the NSE and the Capital Markets Authority assume no responsibility for thecorrectness of any statements or opinions made, or reports contained in this Listing Statement, as the casemay be. Approval of the Introduction is not to be taken as an indication of the merits of the Issuer or of theShares.

Should any doubt arise as to the meaning of the contents of this Listing Statement or as to what action totake, please consult your investment bank, financial advisor, stockbroker or other professional advisor, dulyauthorized under the Capital Markets Act, who specializes in advisory on the acquisition of shares and othersecurities.

The Directors of the Issuer, whose names appear on page 59 of this Listing Statement, accept responsibilityfor the information contained in this document. To the best of the knowledge and belief of the Directors(who have taken all reasonable care to ensure that such is the case), the information contained in thisdocument is in accordance with facts and does not omit anything likely to affect the import of suchinformation.

A copy of this Listing Statement together with the documents required by Section 43 of the Companies Act(Cap.486) to be attached hereto, have been delivered to the Registrar of Companies in Nairobi forregistration.

Shares of the Issuer will be available to the general public through the secondary trading on the NSE. Uponlisting, the sale or transfer of Shares will be subject to the rules of the NSE and the CDSC (as defined below).The register will be maintained by CDSC (the “Registrar”). There are currently no other restrictions on thesale or transfer of Shares under Kenyan law by Kenyan residents.

This Listing Statement does not constitute an offer, invitation or the marketing to any person to subscribefor or purchase any new shares in the Issuer. Neither this Listing Statement nor any other information suppliedin connection with the Introduction is intended to provide a complete basis of any credit or other evaluation,nor should it be considered as a recommendation by ADSS or the directors or officers of ADSS, that anyrecipient of this Listing Statement (or any other information supplied in connection with the Introduction)should purchase any shares of the Issuer.

Legal Advisor’s OpinionAnjarwalla & Khanna, the Legal Advisors, have given and not withdrawn their written consent to the inclusionin this Listing Statement of their Legal Opinion (attached as Appendix I), and the references to their namesin the form and context in which they appear, and have authorized the contents of the said Legal Opinion.The Statutory, Legal and General Information section of this Listing Statement lists material contracts whicharose in the ordinary course of business in which the Issuer is currently involved.

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Reporting Accountant’s OpinionThis Listing Statement contains statements from Baker Tilly Meralis, Kenya, the Reporting Accountants,which constitutes statements made by an expert in terms of Section 42(1) of the Companies Act (attachedas Appendix II), The Reporting Accountants have given and not withdrawn their consent to the issue of thesaid statements in the form and context in which they are included in this Listing Statement.

Forward-looking statementThis Listing Statement contains “forward-looking statements” relating to the Company’s business. Theseforward-looking statements can be identified by the use of forward-looking terminology such as “believes”,“expects”, “may”, “is expected to”, “will”, “will continue”, “should”, “would be”, “seeks” or “anticipates” orsimilar expressions, or the negative thereof, or other variations thereof, or comparable terminology or bydiscussions of strategy, plans or intentions.

These statements reflect the current views of the Company with respect to future events and are subject tocertain risks, uncertainties and assumptions. Many factors could cause the actual results, performance orachievements of the Company to be materially different from the future results, performance or achievementsthat may be expressed or implied by such forward-looking statements. Some of these factors are discussedin more detail under “Key Risk Factors” and “The Company”.

Should one or more of these risks or uncertainties materialize, or should underlying assumptions proveincorrect, actual results may vary materially from those described in this Listing Statement as anticipated,believed, estimated or expected.

This Listing Statement is dated: 11th December 2014.

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Chairman’s Statement

Richmond HouseSt Julian’s Avenue

St Peter PortGuernsey GY1 1GZ

17 December 2014

Dear Shareholder,

Proposed Listing on the Growth Enterprise Market Segment of the Nairobi Securities ExchangeAtlas Development & Support Services (the “Company”), the AIM-listed African focussed support servicesand logistics company, is pleased to be joining the Growth Enterprise Market Segment (“GEMS”) of theNairobi Securities Exchange (“NSE”) by way of introduction, making the Company the first AIM listedcompany to join the NSE.

This important step represents a natural alignment of the Company’s ownership structure with its East Africanstakeholders and customers, and demonstrates the Company’s commitment to local ownership. The duallisting is expected to further align the Company with the ongoing strong regional growth and provide afoundation for further growth and development.

Through our primary investment into Ardan Risk & Support Services, we have already built a strong presencewithin the support services and logistics sector, and are currently working for a number of internationalcompanies operating in the East African region.

This dual listing on the NSE will establish the Company as a pioneer, and it represents yet another milestonefor this Company in its quest to achieve its vision of becoming recognised in sub-Saharan Africa as the“specialist service provider of choice” in the logistics support industry.

Since our listing on the AIM Market in June 2013 we have made exceptional progress in implementing ourvision and we warmly invite you to participate in our future growth.

Yours sincerely,

Ian Hollis MannNon- Executive Chairman

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Corporate Information

Issuer Name Atlas Development & Support Services Limited (ADSS)(formerly known as Africa Oilfield Logistics Limited)

Issuer Contact Information Atlas Development & Support Services Limited Richmond HouseSt Julian’s AvenueSt Peter PortGuernsey GY1 1GZTel: +44 (0) 20 7408 9200

Contact Persons

Carl EspreyChief Executive Officer Email: [email protected] Tel: +44 (0) 20 7408 9200Tel: +254 718 923 311/2/3

Peter Lachlan Alexander MonroChief Operating OfficerEmail: [email protected] Tel: +44 (0) 20 7408 9200Tel: +254 718 923 311/2/3

Current Directors of the Issuer � Ian Hollis Mann- British *Non -Executive Chairman

� Carl James Esprey – Italian **Chief Executive Officer

� Barry Lobel – British **Chief Financial Officer

� Lachlan Monro – British **Chief Operating Officer

� Andrew Stuart Groves – British *Executive Director

� Jonathan Wordsworth Wright – British *Non - Executive Director

* address for the purposes of this Listing Statement is c/o RichmondHouse, St Julian’s Avenue, St Peter Port, Guernsey GY1 1GZ.

** address for the purposes of this Listing Statement is 3rd Floor,Kalamu House, Grevillia Grove, Westlands, Nairobi, Kenya.

Registered Office Richmond HouseSt Julian’s AvenueSt Peter PortGuernsey GY1 1GZ

Kenya Branch Office c/o Axis Kenya2nd Floor, Apollo Centre,Ring Road, Parklands, Westlands P.O. Box 764, Sarit Centre, Nairobi, Kenya 00606

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Financial Calendar Financial Year End – 30 June

Incorporation and Kenyan Date of Incorporation: 5th December 2012Branch Registration Country of Incorporation: Guernsey

Date of Kenyan Branch Registration: 6th November 2014

Legislation The Companies (Guernsey) Law 2008 The Companies Act (Cap 486)

Legal Form Non-cellular company limited by shares incorporated in the Islandof Guernsey, Channel Islands with registered number 55964, andregistered in Kenya as a foreign company under Part X of theCompanies Act (Cap 486) registration number CF/2014/166829.

Subsidiaries As at the date of publication of this Listing Statement, AtlasDevelopment & Support Services Limited had 1 subsidiary and9 sub - subsidiaries:

Subsidiary:

� Ardan Risk Holdings Limited, incorporated in Mauritius on9th September 2013, Company No. 118434 C1/GBL

Sub subsidiaries:

o Ardan Logistics Kenya Limited, incorporated in Kenya on 5thMarch 2014, No. CPR/2014/134094

o Ardan Servicos Medicos, Lda, incorporated in Mozambique on9th October 2013

o Ardan Servicos, Logisticos, Lda, incorporated in Mozambiqueon 8th October 2013

o Ardan (Facilities Management) Limited, incorporated in Kenyaon 25th March 2014, No CPR/2014/135230;

o Ardan (Medical Services) Limited, incorporated in Kenya on19th March 2014, No CPR/2014/ 135237;

o Ardan (Risk Management) Limited, incorporated in Kenya on31st March 2014, No CPR/2014/ 135227;

o Ardan (Civil Engineering) Limited, incorporated in Kenya, on27th March 2014, No CPR/2014/ 135217; and

o Ardan (Workforce Accomodation) Limited, incorporated inKenya, on 24th March 2014, No CPR/2014/ 1352223.

Authorised representative in Conrad Nyukurirespect of the Kenya Branch office c/o Axis Kenya

2nd Floor, Apollo Centre,Ring Road, Parklands, Westlands P.O. Box 764, Sarit Centre, Nairobi, Kenya 00606

Auditors Baker Tilly UK Audit LLP25 Farringdon StreetLondon EC4A 3BFUnited Kingdom

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Legal Advisors Anjarwalla & Khanna3rd Floor, The OvalJunction of Ring Road Parklands & Jalaram Road, WestlandsP.O. Box 200-00606, Sarit Centre, Nairobi, Kenya

Company Secretary Phillip Enoch MA (Oxon)

Principal Bankers CFC Stanbic BankCfC Stanbic Bank, CfC Stanbic Centre, Chiromo Road, Nairobi

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Glossary of Definitions and Abbreviations

Subject Definition

ADSS Atlas Development and Support Services Limited

AIM the AIM Market of the London Stock Exchange plc

AIM Rules the AIM Rules for Companies and the AIM Rules for NominatedAdvisers each produced by the London Stock Exchange, and eachas amended from time to time

ALK Ardan Logistics Kenya Limited, a company incorporated in Kenyawith registration number CPR/2014/134094

AOL Africa Oilfield Logistics Limited

Ardan the collective group of companies previously operating under the“Ardan Risk & Support Services” brand, including Ardan Risk &Support Services (K) Limited, Ardan Risk Holdings Limited and ALK

Articles The Articles of Incorporation of Atlas Development & SupportServices Limited

Board The Board of Directors of the Issuer

CAGR Compounded Annual Growth Rate

Capital Markets Legislation Means (a) the Capital Markets Act, Chapter 485A of the Laws ofKenya and all subsidiary legislation and rules and guidelinespromulgated thereunder (b) the rules of the NSE (c) Companies Actand (d) any law applicable to capital markets in Kenya

CBK Central Bank of Kenya

CBR Central Bank Rate

CCA Comparable Company Analysis

CDSC Central Depository and Settlement Corporation Limited, under whichoperates the Central Depository System, a computer systemoperated in accordance with the Central Depositories Act, 2000 thatfacilitates holding of securities in electronic accounts therebyfacilitating faster and easier processing of transactions at the NSE

CEO Chief Executive Officer

CMA The Capital Markets Authority in Kenya, a statutory bodyincorporated under the Capital Markets Act and includes anybodyreplacing it or any of its functions

Company or Issuer Atlas Development & Support Services Limited

Cross Listing Listing of Atlas Development and support services’ shares on theNSE as well as AIM of the LSE. This can be interchangeable withDual Listing.

DFI Development Finance Institution

Directors or the Board Directors of the Company whose names appear on page 59 of thisListing Statement

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DPS Dividend Per Share

EBITDA Earnings Before Interest Tax Depreciation and Amortization

EPS Earnings Per Share

FCFF Free Cash Flow to Firm

FID Final Investment Decision

F&O the Framework and Option Agreement entered into between(amongst others) Ardan and ADSS on 28 March 2014

FSMA the Financial Services and Markets Act 2000, as amended

GBP British Pound

GDP Gross Domestic Product

GEMS Growth Enterprise Market Segment of the NSE

Group the Company and its subsidiaries undertakings, as described onpage v, operating under the “Atlas Development & Support Services”brand

KES Kenya Shilling

L-N Form Form to be utilized to facilitate transfer of shares from the LondonRegister to the Nairobi Register

Law the Companies (Guernsey) Law, 2008 (as amended)

Listing Admission of the Shares to trading on GEMS

Listing Price KES 11.50 per share

LNG Liquefied Natural Gas

London Register the Company’s principal share register as maintained by CapitaRegistrars (Guernsey) Limited

Market Cap Market Capitalisation

MPC Monetary Policy Committee

MSCI Index The MSCI World is a stock market index of 1,612 ‘world’ stocks,maintained by MSCI Inc., formerly Morgan Stanley CapitalInternational.

N-L Form Form to be utilized to facilitate transfer of shares from the NairobiRegister to the London Register

NASI Nairobi All Share Index

NSE Nairobi Securities Exchange

Ordinary Shares ordinary shares of no par value in Atlas Development & SupportServices Limited

PPP Public Private Partnership

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Removal Form the form utilized by an investor to request the transfer of shares fromthe Company’s share register to its sub-register and/or vice versa

Second Tier Subsidiaries or ALK, Ardan Servicos Medicos Lda, Ardan Servicos Logisticos Lda,Sub - subsidiaries Atlas Development (Engineering) Plc, Ardan (Facilities

Management) Limited, Ardan (Medical Services) Limited, Ardan(Risk Management) Limited, Ardan (Civil Engineering) Limited andArdan (Workforce Accommodation) Limited

Subsidiary Ardan Risk Holdings Limited

UKLA the UKLA department of the Financial Conduct Authority, acting inits capacity as the competent authority for the purposes of Part VIof FSMA

USD / US Dollar United States Dollar

VAT Value Added Tax

WACC Weighted Average Cost of Capital

Y/Y Year on Year

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1. KEY FEATURES OF THE TRANSACTIONThis Listing Statement should be read in full along with other documents available for inspection for fullappreciation of the subject matter.

1.1. The ListingAtlas Development & Support Services Limited is pleased to be joining the Nairobi Securities Exchange(NSE). ADSS has opted to list by way of introduction on the Growth Enterprise Market Segment (GEMS) ofthe NSE in conjunction with the Company’s existing listing on AIM.

1.2. Reasons for the listingThe cross listing on GEMS will create a broader base of shareholders and added liquidity for existingshareholders, provide East African investors with access to the Company and raise the profile of theCompany.

This listing statement will be available for inspection at the offices of Burbidge Capital Limited until and fora minimum of five working days after the date of Listing. The Listing Statement will also be available on theCompany’s website indefinitely following the Listing.

1.3. Transaction Overview Transaction Listing by Introduction on GEMS segment of NSE

Issuer Atlas Development & Support Services Limited

Shares 433,063,193 ordinary shares each of no par value each comprisingthe issued and fully paid up share capital of the Issuer.

No of shares to be issued/made 433,063,193 ordinary shares each of no par valueavailable for trading

Status Upon Listing, freely transferable Ordinary Shares ranking pari passuwith each other.

Trades Ordinary Shares will be fully dematerialized and uploaded into theCDSC prior to trading. The Ordinary Shares listed on AIM arecurrently held in certificated form or under the CREST system, (apaperless settlement procedure)

Compliance The Listing is subject to the requirements of the Articles, the Law,the Capital Markets Act, the Nairobi Securities Exchange ListingManual and the Central Depositories Act, 2000.

Listing/ Introduction Price KES 11.50 per Ordinary Share

Nominated Advisor Burbidge Capital Limited

Market Segment GEMS

Expected Listing Date December 2014

Governing Law Kenyan Law(of the Listing and this Listing Statement)

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1.4. Basis for Setting Offer priceThe Offer price has been determined by the Issuer in consultation with the Nominated Advisor on the basisthe current market price of ADSS on AIM.

1.5. Trading of sharesAll shares will be fully transferrable between AIM and NSE. The transfer of shares from one market to theother will follow the model outlined below:

Nairobi-to-London� The investor will fill in the Removal Form and submit it to their broker in Kenya, who will then verify

the information and deliver the form to CDSC.

� CDSC will remove the shares from the investor’s account and attach the investor’s statementconfirming the removal of the securities from the account and electronically send the documents toCapita Registrars.

� Capita Registrars will then move the shares from the Nairobi Register to the investor’s nominatedCREST account, in accordance with the details supplied on the N-L Form.

London-to-Nairobi� CDSC will receive the L-N Form and attachments electronically from Capita Registrars.

� CDSC will verify information provided and credit the investor’s account as per the details on the L-NForm.

� Capita Registrars will move the shares from the London Register to the Kenyan Register and CDSCRegistrars will adjust the register accordingly in accordance with the details supplied on the L-N Form.

The transfer of shares from one market to the other will typically take c.4 business days, following which theshares will be tradable in the destination market.

1.6. The CompanyAtlas Development & Support Services Limited (previously known as “African Oilfield Logistics Limited”) wasformed to acquire and/or invest in businesses which focus on the logistics support industry in respect of oiland gas exploration and other development projects in sub-Saharan Africa. The Company was incorporatedin Guernsey on 5 December 2012 and its ordinary share capital was admitted to trading on AIM on 25 June2013 (the “Admission”).

Subsequent to the Admission, the Board identified Ardan as an appropriate acquisition target and, on 5August 2013, the Company entered into an acquisition agreement pursuant to which the Company agreedto acquire a 49 per cent. interest in Ardan for consideration of US$4 million, satisfied by the issue of newordinary shares in the capital of the Company.

In addition to this acquisition, the Company was also granted a period of exclusivity with a view to enteringinto an agreement to acquire the remaining 51 per cent. interest in Ardan.

Subsequently, on 28 March 2014, the Company entered into a Framework and Option Agreement (the“F&O”) pursuant to which:

� overseen by ADSS, Ardan undertook a corporate and contractual restructuring programme torationalise operational management, and business implementation, planning and reporting; and

� ADSS was granted a three year conditional call option (the “Call Option”) to acquire 100 per cent. ofALK, a separate and new ‘shell’ company in Kenya from which the restructured business of Ardanwould be operated.

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In September 2014, the Board exercised the Call Option. Completion of the Call Option was conditionalupon shareholder approval and receipt of all necessary and applicable 3rd party approvals (in all relevantjurisdictions). The 3rd party approvals were obtained in July 2014 and on 22 October 2014, where theshareholders of ADSS approved the completion of the Call Option and the acquisition of ALK on the termsset out in the F&O.

1.7. Background on business operations Founded in 2008, Ardan has developed and recruited a highly experienced operational team and establisheditself as a cost-effective, quality provider of turn-key logistics and support services solutions to internationalcorporate clients operating primarily in the oil & gas and mining sectors in East Africa, achieving consistentgrowth since inception.

Ardan’s services currently include: Construction and Engineering, Procurement and Logistics, Catering andCamp Management, Safety, Health, Environment and Quality Management, Health and Safety Training,Medical Services, Community Relations, Personnel Placement as detailed in further detail in Part 5 of thisListing Statement.

Ardan’s focus since incorporation has been on East Africa, with a significant amount of growth leveragedon the increase in exploration around the Rift Valley area in Kenya. Companies such as Tullow Oil plc andAfrica Oil Corp. have made significant commitments to drilling in this area and have already reportedencountering commercially viable quantities of oil. Against this backdrop of increased exploration activity,the Board believes that there is an urgent and real need for professional, internationally certified and reliablelocal partners who can provide quality oilfield services and logistics to the exploration companies operatingin the region, at a competitive cost.

ADSS continues to maintain an active investment policy and will consider investing in and/or acquiringbusinesses which the Board believes could generate material value for the Company and its shareholders.The Board has well established business contacts and connections in sub-Saharan Africa and intends touse the experience of working within companies focussed on operating in sub-Saharan Africa to enablethem to identify prospective acquisition and/or investment targets with scope for growth.

1.8. Key Investment highlights

Competent Management

The management of ADSS is highly qualified and has significant experience in the oil and gas, mining andsupport services sectors.

High quality clients

ADSS has a high quality clientele having worked, amongst others, with Tullow, Weatherford International,fertiliser producer Yara and potash developer Allana Potash Corp. Most of ADSS’ clients are multinationalcompanies exploring for natural resource opportunities in the region.

Few sophisticated players

The lack of local, sophisticated and experienced support services companies allows ADSS to enjoy lesscompetition and therefore reap the benefit of winning major contracts offered by the oil and gas explorationcompanies. However, more international logistics players are expected to venture into the region as morediscoveries are made.

Local ownership

The Company believes that increasing its local ownership through the Listing will further demonstrate itscommitment to operating in East Africa and give it competitive advantages against international serviceproviders.

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1.9. Key Listing Statistics Listing price per Ordinary Share KES 11.5

Total number of issued shares before the private placement 393,923,366

Total number of shares issued during private placement 39,139,827

Total number of shares after private placement 433,063,193

1.10. Transaction TimetableDeadline for uploading the Ordinary Shares into CDSC Monday 15 December 2014

Dispatch of Listing Statement to shareholders Tuesday 16 December 2014

Listing and Commencement of Trading at the NSE Wednesday 17 December 2014

1.11. Expenses of the ListingThe expenses of the Listing which will fall under the account of the Issuer are estimated at KES 9,855,000.

Professional fees and related costs KES*

Nominated Advisor** 4, 385,000

Reporting Accountants 1,500,000

Legal Advisors 2,600,000

Registrars 250,000

NSE listing fees 250,000

Public Relations 870,000––––––––––––

Total 9,855,000––––––––––––––––––––––––

*These figures may be subject to change. The expenses of the Listing amount to 0.2 per cent. of the Company’s Market Cap on theOffer price or KES 11.5 per Share.

**an exchange rate of KES 87.70 / USD has been applied for the nominated advisor fee of USD 50,000.

1.12. Lock-In Period for DirectorsOn 25 September 2014, as a sign of commitment to the growth of the Company, the Company enteredinto lock-in agreements with each of Mr. Esprey, Mr. Groves, Mr. Lobel, Mr. Monro and Mr. Mann (“2014Locked-in Shareholders”) pursuant to which each of the 2014 Locked-in Shareholders agreed (subject tocertain limitations discussed below) not to dispose of any Ordinary Shares, and to procure that no personsassociated with the 2014 Locked-in Shareholder who are the absolute beneficial and registered owners ofOrdinary Shares will dispose of any Ordinary Shares for a period of 12 months from the date of Admission.

1.13. Dividend PolicyADSS has a policy to pay dividends when permitted by law and subject to the consideration of the resultsof its operations, financial position, investment and liquidity requirements, legal reserves and minimum capitalrequirements.

The declaration, amount and payment of dividends will be recommended, subject to the limitations set forthabove (and any other relevant considerations), by the Board, and approved by majority vote of theShareholders at a general meeting of the Company.

1.14. Investor Relations PolicyThe Company intends to adopt an open policy of full disclosure to investors and has already put measuresin place to facilitate this. It intends to offer semi-annual briefings following the listing (presently anticipatedto coincide with the announcement of annual and interim results).

2. ECONOMIC OVERVIEWSet out below is an outline/description of the key jurisdictions in which the Company is likely to operate.This analysis should not be taken as:

� a definitive statement regarding the subject matter but is simply the Board’s understanding based onadvice received from Burbidge Capital;

� a limitation of the Company’s ability to operate in other jurisdictions; or

� a reasonable commitment to continue operation in any jurisdiction for a specific period of time.

2.1. Kenya

2.1.1. Economic GrowthThe Kenyan economy expanded at a rate of 4.7 per cent. in 2013 following a 4.6 per cent. expansion anda 4.4 per cent. expansion in 2012 and 2011 respectively. The World Bank projects that Kenya’s GDP willgrow 4.7 per cent. a year in 2014 and 2015 but indicated that the economy has the potential to achieve ahigher growth rate of 5 per cent. in the next two years. The 2013 performance was supported by:

� the stable macroeconomic environment for the better part of the year;

� low and stable inflation supported by improved supply of basic foods, lower international oil pricesand lower costs of electricity; and

� infrastructural development and the construction sector.

Weak investor confidence resulted in low private investment and subdued GDP growth; drought in the fourthquarter of 2013 depressed growth in agriculture and increased electricity prices, driving up production costsand reducing GDP by an estimated KES 23.8 billion (0.7 per cent.) in 2013.3

The World Bank believe that the projected growth of 4.7 per cent. a year in 2014 and 2015 will be supportedby stronger global economic activity among Kenya’s trading partners. This year macroeconomic stabilitywitnessed in 2013 has continued into the first half of 2014 and is likely to be maintained for the rest of theyear. The projections assume that the impact of inadequate rainfall and the insecurity caused by terroristactivity will be limited.4

The value of Kenyan goods and services – Gross Domestic Product (GDP) – for 2013 was estimated atUSD 53.4 billion (4.76 trillion Kenya shillings) in 2013.

The provisional estimates of GDP show that the country’s economy expanded by 5.8 per cent. during thesecond quarter of 2014 compared to 7.2 per cent. recorded during a similar quarter of 2013. The growthwas mainly supported by robust growths in: construction (18.9 per cent.); manufacturing (9.1 per cent.);financial & insurance (8.3 per cent.); information and communication (6.4 per cent.); and wholesale and retailtrade (6.8 per cent.).5

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3 Reference: Northeasterly bearing Economic Outlook by Deloitte 2014

4 Reference: http://www.worldbank.org/en/country/kenya/publication/kenya-economic-update-economy-facing-headwinds-2014-special-focus-delivering-primary-healthcare-services and World Bank Economic Update 2014

5 Revised Quarterly Gross Domestic Product, October 2014, Kenya Bureau of Statistics

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Source: World Bank Database

2.1.2. Macro-Economic OverviewThe movements in inflation, interest rates and exchange rates are reviewed further, below:

(i) Inflation

Inflation expectations were anchored at a lower level as a result of lower international food and fuel pricesand prudent monetary policy. Inflation averaged 5.7 per cent. (7.3 per cent. for food) in 2013 and hasaveraged 7.3 per cent. (9.6 per cent. for food) in the 12 months ending in September 2014.6

Source: Kenya Bureau of Statistics, Central Bank of Kenya

Consumer Price Index (CPI) rose from 150.60 points in July 2014 to 152.02 points in August 2014. Theoverall rate of inflation increased from 7.67 per cent. to 8.36 per cent. during the same period. CPI rosefrom 152.02 points in August 2014 to 152.24 points in September 2014. However, the overall rate of inflationdecreased from 8.36 per cent. to 6.6 per cent. during the same period due to a decline in the Housing,Water, Electricity, Gas and Other Fuels’ Index, which decreased collectively by 0.52 per cent.. This declinewas attributed to notable falls in the cost of kerosene and electricity. Electricity prices were lower inSeptember 2014 compared with August 2014 due to reduction in fuel cost and forex adjustment charges.7

(ii) Interest Rates

The average yield rate for the 91-day Treasury bills, which is a benchmark for the general trend of interestrates, fell to 8.29 per cent. in August 2014 from 9.78 per cent. in July 2014. The inter-bank rates increasedto 11.72 per cent. during the period. The available data shows that the average lending rate has averaged16.69 per cent. from January to September 2014.8

0.02.04.06.08.0

Perc

ent

Year

Kenya Real GDP Growth (%)

Kenya RealGDP Growth(%)

02468

10

Perc

ent

Months

Kenya Annual Inflation Rate (%)

Kenya AnnualInflation Rate(%)

6 Source: Kenya National Bureau of StatisticsThe Central Bank https://www.centralbank.go.ke/index.php/balance-of-payment-statistics/inflationrates

7 Consumer Price Indices and Inflation Rates for September 2014, Kenya Bureau of statistics Publications

7

Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14

T-bill 91-day 9.26 9.16 8.98 8.80 8.82 9.81 9.78 8.29 8.35 Interbank 10.43 8.83 6.47 7.40 7.76 6.60 8.08 11.79 7.43 Average lending rate 17.03 17.06 16.91 16.70 16.97 16.36 16.91 16.26 16.04 Overdraft rate 16.82 16.88 16.44 16.44 17.85 15.88 17.12 16.20 15.79 Average deposit rate 6.55 6.57 6.61 6.48 6.42 6.56 6.59 6.51 6.64 Savings 1.56 1.49 1.56 1.53 1.54 1.50 1.33 1.50 1.51

Source: Central Bank of Kenya

(iii) Exchange Rate

Since the beginning of 2014, the Kenya Shilling has been losing value when compared to major worldcurrencies. The KES, which lost 2.6 per cent. against the dollar up to August 2014, remained under pressurefrom importers seeking dollars and was predicted to weaken further in the face of a shortage of hard currencyinflows. This is mainly being fuelled by a drop in the number of tourists visiting the country after major tourismmarket countries issued travel advisories against Kenya. However, the situation is expected to start improvingas countries such as Germany recently announced having lifted its travel advisory against Kenya.

In the month of August, the KES appreciated against the GBP, the Euro, the Ugandan and Tanzanian shilling.In contrast, the KES depreciated against the US Dollar and the South African Rand. In the month ofSeptember the shilling appreciated against GBP, the Euro, and the South African Rand but depreciatedagainst the US Dollar, and the Ugandan and Tanzanian shillings.9

Currency Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14

1 US Dollar 86.21 86.28 86.49 86.72 87.41 87.61 87.77 88.11 88.841 Sterling Pound 141.99 142.81 143.76 145.08 147.29 148.15 150.01 147.24 144.991 Euro 117.50 117.81 119.58 119.78 120.09 119.16 118.93 117.40 114.741 SA Rand 7.96 7.86 7.96 8.20 8.39 8.20 8.22 8.26 8.11UGS/KES 29.00 28.61 29.28 29.19 28.97 29.45 30.00 29.66 29.471 TZS/KES 18.68 18.82 18.88 18.86 18.92 19.18 18.97 18.89 18.78

Source: Central Bank of Kenya

2.2 Mozambique

2.2.1. Economic GrowthAccording to the Africa Development Bank, Mozambique’s economy remained one of the most dynamic onthe continent in 2013, with a 7 per cent. rate of real GDP growth, in spite of the major flooding whichoccurred during the first quarter and the low intensity politico-military confrontations between governmentand the opposition movement. The buoyant economy remains driven by “mega-projects”, predominantlyfunded by foreign capital, focused on aluminium, extractive industries, and the energy sector.10

8 The Central Bank of Kenya, Macroeconomic statistics

9 The Central Bank of Kenya, Macroeconomic statisticshttps://www.centralbank.go.ke/index.php/balance-of-payment-statistics/exchange-rates

10 Source: African Economic Outlook (AEO) 2014http://www.africaneconomicoutlook.org/en/countries/southern-africa/mozambique/

8

Sources: AfDB Statistics Department, and INE, AfDB (e) estimates and (p) projections

The extractive sector was the fastest growing in 2013 at 22 per cent., propelled by coal exports. Anothercontinued growth driver has been increased public expenditure – estimated to reach 36.8 per cent. of GDPin 2014 – primarily benefiting the construction, services, and transport and communications sectors. Thesteady gains in GDP per capita – up 44.7 per cent. since 2010, and now estimated at USD 640 – is fuellingdomestic demand, although this is centred mainly on urban areas, where about 20 per cent. of thepopulation lives. The financial sector follows behind the extractive industry as the most dynamic. It expandedby 17.7 per cent. in 2013, supported by increased household income and credit expansion.

2.2.2 Macro-Economic Overview

(i) Inflation

The inflation rate in Mozambique averaged 6.56 per cent. from 2009 until 2014, reaching an all-time high of17.44 per cent. in December of 2010 and a record low of 1.05 per cent. in November of 2009. The Bankof Mozambique continues to follow a prudent but active monetary policy stance. Despite weather-relatedexogenous shocks, inflation has remained under control at low levels, with the 12-month average ending2013 at 4.15 per cent., well below the central bank’s initial 7.5 per cent. target.

Sources: World Bank Database

Mozambican annual consumer inflation slowed to 2.75 per cent. in June of 2014 from 2.9 per cent. recordedin the previous month. A year earlier the annual inflation rate was 4.86 per cent.. Upward inflationarypressures came mostly from higher prices of education (5.85 per cent.) and food. The inflation rate inMozambique was recorded at 2.23 per cent. in September of 2014. Inflation has gradually declined overthe last 12 months having recorded 4.42 per cent. in October 2014. The monetary policy committee citedthat the behaviour of inflation is explained by the greater offer on the domestic market of fruit and vegetables,reflecting the seasonal impact of the cool period of the year, plus the stability of the metical on the exchangemarket, supported by a greater availability of foreign currency.11

0.0

5.0

10.0

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

(p)

2015

(p)

Perc

ent

Year

Mozambique Real GDP Growth (%)

Mozambique RealGDP Growth (%)

0

5

10

15

2005 2007 2009 2011 2013

Perc

enta

ge

Year

Mozambique Inflation Rate (%)

Inflation

11 BNI Development Bank of Mozambique Financial Markets Magazine-Data sourced from the National Institute of Statistics http://www.ine.gov.mz/

9

Source: Mozambique’s National Statistics Institute (INE)

(ii) Interest rates

At its August 9th, 2014 meeting, Mozambican Monetary Policy Committee decided to hold the benchmarkinterest rate at 8.25 per cent., (the same rate applied since October of 2013), citing that the recent moderatedinflation outlook is meeting the macroeconomic targets for the year. Despite the central bank holding itsown interest rates steady for the past year, commercial banks interest rates still remain high. Average interestrates charged by the banks to their clients in December 2013, for loans maturing in a year, was 19.80 percent., only 0.45 per cent. lower than in November 2013. These rates have typically remained quite highthroughout this year Available data shows that the average interest rate on bank loans fell slightly from June2014, but was still high at 20.8 per cent. in July 2014.12

Source: Bank of Mozambique

(iii) Exchange rate

The Metical has remained relatively stable against the United States Dollar (USD) since the beginning of2013, losing just 1 per cent. up to September 2014. This helped control the cost of fuel imports, while thecurrency’s 15.7 per cent. appreciation against the South African Rand in the same period containedinflationary pressures deriving from food and other imported consumer goods.13

0

1

2

3

4

5

Oct-13 Dec-13 Feb-14 Apr-14 June 14 Aug-14

Perc

enta

ge

Month

Mozambique Annual Inflation Rate (%)

Mozambique Annual Inflation Rate

19.0019.5020.0020.5021.0021.50

Perc

ent

Month

Average Interest rate for a Loan with 1 yr Maturity

12 BNI Development Bank of Mozambique Financial Markets MagazineData sourced from Bank of Mozambique http://www.bancomoc.mz/PEstudos_en.aspx?id=P&ling=en

13 BNI Development Bank of Mozambique Financial Markets MagazineData sourced from Bank of Mozambique http://www.bancomoc.mz/Mercados.aspx?id=tcmd&ling=pt

10

Currency Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14

Dollar 29.83 31.5 31.53 31.04 31.25 31.29 30.76 30.13 30.32SA Rand 2.75 2.86 2.93 2.94 3.00 2.93 2.88 2.82 2.76

Source: Bank of Mozambique

Since the start of 2014 the Metical has depreciated against both the Dollar and the South African Rand.The Mozambique Metical decreased to 30.32 in September from 30.13 in August of 2014 but recoveredslightly against the South Africa Rand in September.

2.3. Ethiopia

2.3.1 Economic GrowthThe Ethiopian economy has experienced strong and broad based growth over the last 3 years, averaging10 per cent. per year between 2011 and 2013, compared to the regional average of 6.8 per cent., and isforecasted to grow at an average of 8.2 per cent. for the next 5 years between 2014 and 2019, accordingto the IMF World Economic Outlook Database, October 2014.

Source: IMF WEO Database: October 2014/BC Analysis

According to World Bank’s report- 3rd Ethiopia Economic Update: June 2014, expansion of the services,agriculture and industry sectors contributed most to GDP growth (4.5 per cent., 3.1 per cent. and 2.1 percent., respectively). Construction activity was the major driver of the non-manufacturing industry sector, witha growth contribution of 1.4 per cent. in 2013, while within services, transport and communications wasthe leading sector.14

Ethiopia’s economic growth has also been supported largely by the substantial public investment spurredby the government’s current five-year development plan (2010/11-2014/15) - known as the Growth andTransformation Plan (GTP) - and increased domestic demand largely driven by a growing population. TheGTP is geared towards fostering broad-based development in a sustainable manner to achieve the country’sMillennium Development Goals. Key goals of the GTP include:

� Rapid economic growth, targeted for 11 per cent. per year at worst and, at best, to double the sizeof the economy by 2015, with GDP per capita expected to reach $698 by 2015;

� Agricultural production is to double, to ensure food security in Ethiopia for the first time;

� An increased contribution from the industrial sector, particularly focused on increased production insugar, textiles, leather products and cement;

0

2

4

6

8

10

12

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Perc

enta

ge

Year

Ethiopia Annual GDP Growth Rate (%)

Actual

Estimate

14 3RD Ethiopia Economic Update Strengthening Export Performance Through Improved Competitiveness: June 2014 - “Real Sector”

11

� Foreign exchange reserves are projected to increase and the Birr is to depreciate by 5 per cent.against the dollar each year;

� The roads network should increase from 49,000 km to 64,500 km by 2015;

� Power generation capacity will increase from the current 2,000 MW to 8,000 MW, and the numberof customers from the current two million to four million by 2015;

� Construction of 2,395 km of railway line.15

Earlier this year, the World Bank approved funding of USD 320 million towards the construction of a 258 kmroad that will link the North West Oromia state and the South West Amhara State. The investment isexpected to finance 83 per cent. of the construction with the remaining 17 per cent. being funded by theEthiopian state. Investment in road infrastructure is expected to support the country’s sustainable growthachieved during the past decade.16

In May 2014, Ethiopia’s rating by Fitch, Moody’s and Standard and Poors agencies were B, B1 and B/Brespectively, reflecting a stable outlook for the economy. These ratings were driven by Ethiopia’s strongrecord of economic growth in the last decade and place Ethiopia at a position to tap into the global marketsto mobilize resources towards financing its development projects.17

2.3.2 Macro-Economic OverviewThe movements in inflation, interest rates and exchange rates are reviewed further, below:

(i) Inflation18

Ethiopian inflation has remained in single digits for almost a year. As can be seen from the chart below theSeptember 2014 general y/y inflation has increased by 5.6 per cent. as compared to September 2013. The5.6 per cent. rise in general inflation rate was due to an increase in year�on�year food inflation by 3.6 percent. in September 2014 as compared to September 2013 and an increase in the Non�Food inflation by7.8 per cent. in September 2014 as compared to September 2013.

International factors also contributed to reduced inflationary pressure. A decomposition of inflation intotradable and non-tradable goods revealed that internationally traded goods (imported and exportedcommodities) in Addis Ababa exhibited a much faster decline in inflation than goods which are notinternationally traded. In addition, a tightening of monetary policy has also contributed to lower inflation. Forinstance, a strong fiscal stance, particularly measures to improve tax administration and enforcement,contained the fiscal deficit at 2 per cent. of GDP in 2012/13 compared to 1.2 per cent. of GDP in 2011/12.

Source: The Federal Democratic Republic of Ethiopia Central Statistical Agency/ BC Analysis

0

2

4

6

8

10

Sep-

13O

ct-13

Nov

-13

Dec

-13

Jan-

14Fe

b-14

Mar

-14

Apr

-14

May

-14

Jun-

14Ju

l-14

Aug

-14

Sep-

14

Perc

enta

tge

Month

Ethiopia Annual Inflation Rate (%)

Ethiopia AnnualInflation Rate

15 World Bank Ethiopia overview- http://www.worldbank.org/en/country/ethiopia/overview-

16 World Bank Ethiopia overview- http://www.worldbank.org/en/country/ethiopia/overview-

17 https://www.moodys.com/research/Moodys-assigns-B1-issuer-ratings-to-the-Government-of-Ethiopia--PR_298848,http://www.reuters.com/article/2014/05/09/fitch-rates-ethiopia-b-outlook-stable-idUSFit69988020140509,http://www.standardandpoors.com/ratings/sovereigns/ratings-list/en/ap?sectorName=null&subSectorCode=39

18 The Federal Democratic Republic Of Ethiopia Central Statistical Agency: September 2014-

12

(ii) Interest Rates

Lower inflation, in turn, contributed to lower real interest rates. The maximum lending rate has been positivein real terms since 2012 while the real minimum deposit rate has been negative.

Average saving deposit and lending rates remained unchanged from Q4 of 2013 at 5.4 per cent. and11.88 per cent., respectively, both on quarterly and annual basis. The weighted average time deposit rate,registered annual increment of 3.0 per cent. in Q1 of 2014, and increased by 5.2 per cent. in Q2 of 2014,but remained unchanged in Q3 of 2014.19

(iii) Exchange rates

In the interbank foreign exchange market, the average official exchange rate of the Birr depreciated by5.6 per cent. compared to last year same period and reached Birr 18.5331/USD. Likewise, the parallelmarket average exchange rate was depreciated by 9.2 per cent. relative to the rate a year ago. Consequently,the premium between the official and parallel market rates in the first quarter widened to 9.0 per cent. from5.4 per cent. in same quarter last year.20

During Q2 2014, the average official exchange rate of the Birr depreciated by 4.8 per cent. and 1.1 per cent.compared to last year same quarter and the preceding quarter, respectively, to reach Birr 18.94/USD. 21TheEthiopian Birr increased to 19.81 in July from 19.59 in June of 2014.

19 National Bank of Ethiopia Quarterly Bulletin Q1, Q2, Q3 2013-14-

20 National Bank of Ethiopia Quarterly Bulletin Q1 2013-14-

21 National Bank of Ethiopia Quarterly Bulletin Q2 2013-14-

3. OVERVIEW OF THE KENYA EQUITY MARKETIn 2013 the listed equities market, the NSE closed the year as the top performing African bourse accordingto the MSCI index (an index created by MSCI that is designed to measure equity market performance), andthe MSCI frontier markets index. Stability in the macro-economic environment, the peaceful outcome of the2013 general election and significant corporate actions over the year bolstered investors’ confidence inKenya’s listed equities market. The Nairobi All Share Index (“NASI”) rallied 44.1 per cent. during the yearclosing at 136.65 points. In 2013, equity turnover climbed 76.7 per cent. to a high of USD 1.8bn as a resultof increased foreign investor participation. Net foreign inflows stood at USD 392.60m (previous year, USD268.81m. In addition, 2012 saw the introduction of the GEMS on the NSE, targeting mid-size, high growthcompanies. The GEMS market attracted its first listing (a real estate developer, Home Afrika), in July 2013.Of other notable actions in the market, was the delisting of Access Kenya Group following a successfultake-over bid by Dimension Data Holdings (42.0 per cent. premium), and the delisting of CMC holdingsfollowing the takeover by Dubai-based conglomerate Al-Futtaim Group.

In the first half of 2014, (January to June), investor wealth at the NSE grew by KES 186 billion affirming thebourse’s position as one of Kenya’s most dependable investment options. Market capitalisation, the valueof all listed stocks, rose 10 per cent. to KES 2.01 trillion helped by share price appreciation in key insurance,banking, and telecommunications sectors. Small and medium-sized counters, however, recorded highergrowth than larger ones. The NSE 20 Share Index — listing of top players in each segment of the market— dropped 0.9 per cent. to stand at 4885 points even as the NASI rose 10 per cent. to 150 points duringthe six month period.

September 2014 was a bullish month at the NSE with the 20 Share Index crossing the 5,400.00 mark.Turnover rose to USD 221.16m (previous month USD 178.31m) while NASI advanced 3.5 per cent. to closeat 163.45 points (16.7 per cent. YTD). In the last week of September 2014, the exchange showed signs ofslowing down driven by a buyers’ market as investors moved to lock in gains made during the bull-run. Themarket is expected to remain vibrant especially driven by investor excitement around corporate actions.

13

14

4. OVERVIEW OF THE NATURAL RESOURCES SECTOR IN EAST AFRICA AND THEOPPORTUNITY FOR PROFESSIONAL SUPPORT SERVICES PROVIDERSDiscoveries of oil and gas in East Africa are relatively recent, with the major commercial discoveries comingin the last five years. Potential hydrocarbon basins across the region are currently the subject of activeinterest and the Directors expect the sector to be a key driver of the economic growth of East Africa formany years once these projects commence.

East Africa has continued to hit the oil and gas industry headlines and it seems likely that this will continuefor the rest of 2014. September 2013 saw Uganda issue its first production licence (for the Kingfisher field)with the expectation that others will follow in 2014, along with finalisation of plans for a new oil refinery atHoima. In Tanzania, continuing exploration has added to the country’s offshore gas reserves and a newlicensing round was launched in October. Mozambique is expecting FID for its huge offshore gas reservesduring 2014 with plans to construct a 4 train LNG plant with a 20 million tonne per year capacity. Kenya hasseen further exploration success with Tullow indicating total oil reserves of approximately 600 million barrelsin its onshore blocks in Northern Kenya and further offshore drilling is planned for Kenya’s exclusive economiczone in 2014. Whilst Ethiopia has so far enjoyed only limited exploration success it does have potentiallycommercial gas reserves and promising geology. Interest in this country is expected to increase in the comingmonths.22

As exploration gains momentum, investors will rely on local governments to develop basic infrastructuresuch as rail, roads, healthcare facilities, housing, real estate and retail space. Kenya is characterised by asignificant road works programme financed by the African Development Bank, China, Brazil and Japan.These programmes are critical considering the country was losing close to KES 50 million (USD590 000)daily due to traffic congestion in Nairobi and its environs, primarily due to time wasted on the road.31

Previously, according to Africa Construction Trend report 2013, a report by Deloitte, East Africa was a sleepybackwater for the upstream Oil and Gas industry, but the discovery of significant quantities of oil in Ugandain 2006 ushered in a bonanza. In fact, more hydrocarbons have been discovered in East Africa in the pasttwo years than anywhere else. The onshore oil discoveries in Uganda were followed by discoveries in Kenya.Offshore we have seen world-class discoveries of gas in Tanzania.

The development of the oil and gas industry will provide a major stimulus to local economies and will requireextensive upgrading of existing infrastructure. Governments across the region are looking at how to harnessthe power of the industry to benefit their people. At the same time oil and gas companies are focusing theirefforts on the development of local content and local capacity.

Countries in East Africa differ distinctly from one another, specifically with regard to their level of infrastructuredevelopment. Kenya is further progressed than Uganda, Tanzania and Ethiopia, although Ethiopia is makingsome noteworthy developmental inroads. Despite the inherent complexity in developing regional assets,with big projects being worked on or planned being cross-border by nature, there is a sense of collaborationand strategic integration in East Africa. There also appears to be significant activity being initiated in SouthSudan to address basic infrastructure needs such as air transport and roads.

According to the survey done by Deloitte, in which 94 East African projects were sourced, transport isdominating the share of projects after which energy and power feature strongly. The balance of projects inany one sector, in terms of the number thereof, is minimal, although oil and gas projects are beginning tofeature.

22 The Deloitte Guide to Oil and Gas in East Africa, 2014

31 Deloitte on Africa African Construction Trends Report 2013

East Africa Capital Expenditure Analysis:

Source: African Construction Trends Report 2013 by Deloitte

According to the survey, government owns a dominant 72 per cent. of projects in East Africa whileEurope/US holds 11 per cent. in project ownership. International DFIs lead the funding charge at 24 per cent.with China funding 17 per cent. of projects in the region, after which Europe/US funding comes into play for13 per cent. of projects. Africa DFIs are funding 11 per cent. of projects, followed by foreign institutions,which fund 9 per cent.. Of the sample, 71 per cent. are publicly funded, 28 per cent. privately funded and1 per cent. are being funded through PPPs.

European/US construction firms are responsible for the highest number of projects (37 per cent.) whileChinese firms are building 19 per cent. of projects underway. Interestingly, Indian construction firms areinvolved in power plant construction work, particularly aiming to showcase their expertise in the clean energyarena.

The oil and gas boom in East Africa, particularly oil exploration and development in Uganda and Kenya, oilexploration in Somalia and world-class discoveries in Mozambique and Tanzania, together with gold miningoperations in Tanzania, and potash developments in Ethiopia represent significant opportunities for theEnlarged Group to target.

In particular, there is increasing demand from western companies operating in the region for professionalsupport service providers, experienced in providing services in Africa.

15

5. THE BUSINESS5.1 Historical Background Ardan was formed in 2008 by Mike Pelham, initially focusing on providing engineering and constructionservices primarily to companies in the oil and gas sector in sub-Saharan Africa. The business grew bytargeting niche opportunities and is now considered by the Board to be a leading provider of quality turn-keysupport services and logistics solutions to international companies operating on the African continent. Ardanhas established an international client base and currently services its clients at numerous sites across EastAfrica.

5.2 Products and Service Offering Ardan provides a range of products and services, from the provision of remote workforce accommodationto facilities management and medical support, as described in more detail below. As indicated above, Ardanservices multiple industry sectors and has been involved with projects ranging from oil and gas explorationand drilling programmes in Sudan, Somalia, Kenya and Ethiopia, to the largest geothermal project in the riftvalley and potash and gold development in the Danakil region of Northern Ethiopia.

ALK was established in 2014 to provide a new divisionalised structure through which Ardan will be operated.At present certain of Ardan’s existing contracts are being novated to ALK whilst new business is being takenon directly through ALK.

ALK’s tailored turn-key offering is delivered through three main divisions: Ardan Technical; Ardan Services;and Ardan Logistics. The seven key service lines of ALK are described below by division:

5.2.1 Technical

Civil engineering and infrastructure development

Ardan has the ability to deliver engineering solutions and infrastructural development projects across anumber of terrains in Africa. Ardan has experience in managing complex operations from initial planningstages through to site rehabilitation – including road and air strip construction projects, well site andassociated infrastructure construction and the construction of bridges, clinics, schools and watermanagement installations.

The technical team includes experienced professionals in the fields of civil engineering and surveying, designand fabrication, project management, logistics and environmental management.

For the purposes of civil engineering and infrastructure development projects, Ardan maintains its own fleetof transport and construction equipment as well as its own manufacturing yards in Kenya and Ethiopia,specialising in the construction of well site support and accommodation camps, and industry specificinfrastructure.

Workforce accommodation

Ardan supplies multiple styles of accommodation to its clients, ranging from modular containerized units totented fly camps, all of which are tailored to its clients’ specific requirements. Ardan’s containerisedaccommodation solutions provide fully air conditioned modular workforce accommodation units, plumbedwith en-suite shower and lavatory facilities, with electricity and furnished with communication and televisionfacilities. Ardan can also provide its clients with executive tent solutions that are fully air-conditioned, as acost effective and highly mobile alternative.

In conjunction with accommodation units, Ardan also provides modern industrial kitchens, dining rooms,recreation rooms, gymnasia, and meeting and conference facilities.

16

5.2.2 Services

Facilities management

Ardan has experience in providing facilities management and catering services to international and Africabased companies. Ardan employs experienced and qualified camp management, catering andhousekeeping staff to service the complete needs of its clients.

On the catering side, Ardan prepares three meals a day for clients as well as providing on-going refreshmentson demand. Menus are varied and planned with clients to ensure that the appropriate food is prepared tosatisfy the client’s tastes and specific requirements. Fresh produce is regularly delivered to ensure high qualityand nutritious meals.

In addition to catering services, a laundry service is provided and a team of cleaning personnel ensureaccommodation and other camp facilities are maintained and serviced to a high standard. All Ardan siteshave a minimum of Level 3 Food Safety personnel in attendance, overseeing food preparation. In addition,internationally certified health and safety personnel are in attendance at all sites. Camp maintenancepersonnel are internationally certified for their positions and are trained in industry specific Safety, Health,Environment and Quality standards and procedures relevant to their roles.

Medical services

Ardan offers a comprehensive medical package which includes well equipped and stocked on-site clinicsand medical personnel, as well as evacuation planning and execution. In addition, Ardan can arrange countrymedical support, hospital, theatre admissions, doctor and dental or medical specialist appointments andconsultations.

The medical division benefits from having worked with a number of clients, predominantly in the oil and gasindustry, where its local understanding, region specific treatment protocols, and insight into medical facilities,is particularly valued. This division is compliant with the regulatory requirements necessary to operate turnkeymedical solutions within the countries of operation.

Ardan employs numerous full time medical staff including General Practitioners, Intermediate and AdvancedLife Support (“ALS”) Paramedics, Registered Clinical Officers, Registered General Nurses and CommunityNurses, in addition to a network of consulting Tropical Disease experts and trauma surgeons.

Ardan’s medics also facilitate training and awareness workshops on relevant topics such as first aid, malaria,snake bites and many primary health care preventative measures. Furthermore, Ardan retains localRegistered Clinical Officers (“RCO”) and EMT Nurses who utilise their understanding of local cultural issuesand languages to provide additional medical support. Together with the ALS Paramedics, the RCO’s play akey role in training the local recruits on-site on health and hygiene and preventative health care measures.

To service its field clients, Ardan provides high-tech medical support facilities consisting of mobile orsemi-permanent consultation rooms, offices and trauma and resuscitation theatres. The facilities are mannedby paramedic support personnel, qualified and experienced in Advanced Life Support and Intermediate LifeSupport. Ardan also owns a fleet of fully equipped 4×4 ambulances.

Ardan has formed relationships with local medical providers in order to cater for mass casualty and disastersituations including the Kenya Red Cross and Amref Health Africa.

Risk management

Ardan provides clients with a range of security services, including risk assessments, security planning,training of security personnel and the provision of highly experienced security consultants. Ardan’sestablished relations with national security agencies combine with Ardan’s team of skilled security expertsand permanent “on the ground” presence to ensure a quality service.

5.2.3 LogisticsArdan’s logistics services range from general procurement and warehousing to transportation of high valueand oversized goods, such as large construction machinery and oil rigs.

17

5.2.4 Warehousing and PremisesThe Group previously did not hold excess inventory, in part due to a shortage of available storage facilities.To address this and improve its logistics supply chain, ALK entered into a 5 year and 3 month lease over a7,500 ft2 “godown” warehouse located on the outskirts of northern Nairobi effective 1 June 2014. Thiswarehouse will generate efficiencies both in terms of bulk buying and increased storage capability as wellas from a logistical perspective as the location reduces transportation times associated with more centrallocations. In addition, ALK has entered into a 15 year lease over a parcel of land measuring 1.6309 hectaresnear ALK’s main centres of operations with the intention that another warehouse will be built providing alocal storage hub to service the drilling sites of clients in northern Kenya.

5.3 Regional Presence

The Company currently has a presence in Kenya, Mozambique, Mauritius, Ethiopia and Djibouti, withadditional field offices in Madagascar and Liberia.

5.4 Group Structure

* In process of being incorporated

**Dormant company

18

5.5 Board of DirectorsThe Board consists of six Directors, each with significant relevant experience. Brief biographical details ofthe Directors are set out below.

Name Designation Age Nationality Profile Business Address

Ian Mann Non- 56 BritishExecutive Chairman

Carl Chief 35 ItalianEsprey Executive

Officer

Barry Chief 35 BritishLobel Financial

Officer

Lachlan Chief 41 BritishMonro Operating

Officer

Since 2003, Mr. Mann has been the President ofMeridian Global Energy and Resources Fund Ltd, aBVI registered fund manager with two alternativeinvestment funds primarily investing in mining and oiland gas companies. Prior to that, Mr. Mann heldsenior management and partner positions withseveral Bermuda companies. Since 1997, he hasserved as a non-executive director of two Canadianexchange listed mining companies, both nowmerged into other entities and was a non-executiveDirector of PetroMagdalena Energy Corp. from 2011to 2012 when the Group was sold to Pacific RubialesEnergy. Currently, he serves as a non-executiveDirector of Natasa Mining Limited, listed on AIM andTango Gold Mines Inc. listed on the TSX-V. Mr Mannholds an Honours Business Administration degreefrom The University of Western Ontario in London,Canada.

Richmond House,St Julian’sAvenue, St PeterPort, GuernseyGY1 1GZ

Mr Esprey, who qualified as a Chartered Accountantand Chartered Financial Analyst, has built anexpansive career in the natural resource investmentand development sector. After beginning his careerat Deloitte in Johannesburg in 2001, Mr Esprey joinedBHP Billiton in 2004 as an analyst focussed onmergers and acquisitions. After four years at BHPBilliton, Mr Esprey used his expertise in the resourcesindustry to move into equity investment and joinedGLG Partners in London in 2008, where he focussedon natural resources investments.

3rd Floor, Kalamu HouseGrevillia GroveWestlands,NairobiKenya

Mr Lobel is a qualified accountant with extensiveexperience in finance and emerging markets. Hejoined AOL in April 2014 having previously beenDirector of Finance at Partners Capital LLP, a $13billion global private investment office. In addition, heworked in Finance and Private Equity at RP CapitalGroup, an emerging markets hedge fund, andpreviously founded and sold Avocado Trading, a retailbusiness across Southern Africa.



Mr Monro joined AOL in January 2014 havingpreviously been Principal and COO of Blue HackleGroup LLC, a leading international risk managementand support services company operating in US,Middle East and East Africa. He was also a directorat Kroll Associates and is a former British army officer.

19


Andrew Executive 46 BritishGroves Director

Jonathan Non- 43 BritishWright Executive

Director

5.6 Senior Management Name Designation Age Nationality Profile Business Address

Brendan Projects 39 SouthScott Director African

Nick Regional 45 BritishArnold Director

Colin Quarter- 49 BritishAtkinson master

Mr Groves has significant experience in operationsmanagement in Southern and Central Africa and is adirector of a number of public and private companies,including companies in Zambia and Zimbabwe. MrGroves also has experience of introducing severalAfrican focussed companies to AIM. Mr Groves’current directorships include his role as CEO ofAgriterra Limited, CEO of Sable Mining Africa Limitedand non-executive director of African Potash Limited.He was born in Harare, Zimbabwe and educated inZimbabwe and South Africa.


Mr Wright is a corporate finance director atFirstEnergy Capital, a specialist oil & gas investmentbank with offices in Calgary and London. Prior tojoining FirstEnergy, Mr Wright spent over 13 years atSeymour Pierce, latterly as head of corporate finance.During that time, Jonathan led the advisory teams ondozens of financing, M&A and other transactions,including numerous IPOs and fundraisings on AIMand the Official List and several hostile andrecommended takeovers. Prior to Seymour Pierce,Mr Wright spent five years in private practice as acorporate lawyer where he specialised in advisingsmall and medium sized public and privatecompanies.


Mr Scott joined AOL in November 2013 and is ahighly experienced logistics operator having acted asan independent contractor for internationalcompanies operating in Africa for over fifteen years.Mr Scott founded and operated a civil engineeringand construction company based in Kenya andSudan and has developed a vital skill set andunderstanding for operating in Africa.


Nick Arnold has more than 20 years’ experience ofproviding support services. From establishing turnkeysolution business units to leading and managingoperations. He has successfully delivered on largescale, multi-million dollar projects and programmeswithin both the commercial and government sectorsthroughout the Middle East, Central Asia and Africa.


Colin has over 30 years of experience in providingexpeditionary logistics in the British Army. He hasfulfilled roles at every level, and provided logisticssupport at every stage along the length of the supplychain, from frontline receipt and distribution tocoordinating international dispatch. He has extensiveexperience in negotiating contracts and providingrobust logistics networks in numerous jurisdictionsand is very accustomed to supporting operationsacross a wide spectrum of logistics services; from lifesupport to medical facilities, from internationalcontainer shipping to camp construction and traininglogistics teams.


20


Gary Field 55 BritishJones Operations

Manager

Paul Head of 45 BritishJordan Services

Division

Ashley Head of 46 BritishFuller Technical

ServicesDivision

5.6.1 Changes in Senior ManagementThere are no changes in senior management planned or expected during the twelve (12) months followingthe proposed listing of shares.

Gary has previously been employed as DeputyCommander of Dhekelia Garrison which includedresponsibility not only for serving soldiers but alsofamilies and MoD civilians. He holds an MCGI City &Guilds (Masters Degree Equiv) Management &Leadership (Membership). City & Guilds NumeracySkills level 2 (distinction) and City & GuildsCommunications Skills level 2. He also has a diverseportfolio of military qualifications including: Army(Advanced) Educational Promotion Certificate,Equipment Care Management, FacilitiesManagement, Performance for Management for LineManagers and Countersigning Officers, Logistic andBudget Fund Manager.


Paul has had a 25 year career with the British Armyspecialising in expeditionary logistics in harshenvironments worldwide.


Ashley has had a 28 year military career withprogressive experience up to engineering programmemanagement. He was previously involved inproducing the designs and specifications for allinfrastructure to support 16,000 personnel at CampBastion in Helmand Province, and the adjoininginternational airport - the UK’s fourth busiest airfield,and project managed £100M development of LaikipiaAirbase in Kenya, and £5.5M FCO/ DFiD housingconstruction task in Sierra Leone. He is currentlystudying MBA in Strategic Management (atdissertation phase), and holds a degree in BSc (Hons)Engineering Management (Construction), First Class,2013.


21

5.7 Organization Structure

5.8 Competence and Suitability of Directors and ManagementAs at the date of the application and for a period of at least two years prior to the date of the application, asfar as the Issuer is aware, no director or senior manager of ADSS has:

� Had any petition under bankruptcy laws pending or threatened against the directors (for individuals),or senior managers, or any winding-up petition pending or threatened against it (for corporate bodies).

� Had any criminal proceedings in which the director or senior manager was convicted of fraud or anycriminal offence or action either within or outside Kenya.

� Been the subject of any ruling of a court of competent jurisdiction or any governmental body thatpermanently or temporarily prohibits such director or senior manager from acting as an investmentadviser or as a director or employee of a stockbroker, dealer or any financial institution or engagingin any type or business practice or activity.

� Any interest in any transactions which are or were unusual in their nature or conditions or significantto the business of the Company which were effected in the current or immediately preceding financialyear or an earlier financial year and remain in any respect outstanding or unperformed.

5.9 Shareholding

5.9.1 Key shareholders Key shareholders as at 16 October 2014 which hold more than 3% in the Company:

Shareholders Number of Percentage share Ordinary Shares holding

US Global Investors Fund 67,534,983 17.2%Beyond Africa Fund Limited 59,155,171 15.0%Michael Pelham 32,979,355 8.4%Everest Capital Frontier Markets Fund, LP 30,000,000 7.6%Green Cay Asset Management 24,652,000 6.3%Sustainable Capital Ltd 20,884,388 5.3%JM Finn & Co Limited 17,279,537 4.4%TT International Fund Limited 15,144,893 3.9%

Source: Management

22

Below is a breakdown of the shareholding by Directors and management:

Shareholders Number of Percentage share Ordinary Shares holding

Ian Mann 10,132,951 2.50%Carl Esprey 277,778 0.07%Andrew Groves 5,277,778 1.34%Barry Lobel 166,667 0.04%Lachlan Monro 166,667 0.04%Jonathan Wright – –

Source: Management

There are no arrangements, known to the Issuer, the operation of which may at a subsequent date result ina change in control of the Issuer.

There have been no significant changes in the percentage ownership held by any major security holdersduring the past year.

5.9.2 Share Option SchemeOn 9 June 2013, the Company adopted a share option scheme, the “Share Option Scheme”, for whichno application for approval was made to HM Revenue & Customs. The principal features of the Share OptionScheme, which is administered by the Board, are as follows:

i. Eligible participants

Directors of, employees of and consultants to the Company or any of its subsidiaries from time to time whoare not bound to retire within the period of two years after the date on which the Board invites such personsto apply for the grant of options.

ii. Grant of options

The Board may invite an eligible participant to apply to the Company for the grant of an option at any time,provided that an invitation to the directors of the Company may only be made during a period in whichdealings are permitted under the model code on directors’ dealings in securities published by the UKLA.

An invitation to take up an option shall be personal to the eligible participant and shall not be capable ofbeing transferred or assigned.

iii. Exercise Price

The Board shall determine the option price for each Ordinary Share comprised in an option which shall notbe less than the highest of the average middle market quotation of the Ordinary Share or, as the case maybe, the average price of dealings in the Ordinary Share for the five dealing days preceding the invitation dateand the nominal value of an Ordinary Share.

iv. Exercise of options

Options will be exercisable during such period (commencing no earlier than the first anniversary of the dateon which the option is granted (the “Vesting Date”)) as the Board shall determine being not less than threeyears and not longer than five years from the Vesting Date. Earlier exercise is permitted in the event of thetakeover (although in this event there are provisions which may entitle the eligible participant to transfer intothe acquiring company scheme), or a reconstruction or liquidation of the Company. Further, an earlierexercise is permitted if the eligible participant ceases to be a director of, employee of or consultant to theCompany or any of its subsidiaries by reason of his death, ill health, injury, disability, retirement or redundancy.There are time limits in which early exercise of options in such circumstances must be made, failing whichthe options lapse. Except in these circumstances, options will lapse if the eligible participant ceases to beemployed by, a director of or a consultant to the Company or any of its subsidiaries.

23

v. Variation of share capital

On a variation in the issued share capital of the Company by way of a capitalization issue, rights issue, sub-division or consolidation, the option price and/or the number of Ordinary Shares subject to an option and/orthe aggregate maximum number and/or nominal value of the Ordinary Shares available under the ShareOption Scheme may be varied or adjusted by the Board (either generally or in relation to a particularparticipant) as it may in its absolute discretion determine to be appropriate, subject to:

(a) the Company’s auditors confirming in writing that in their opinion such variation or adjustmentis fair and reasonable; and

(b) such variation or adjustment not resulting in Ordinary Share being issued on the exercise of anoption which would fall to be issued at a discount.

vi. Allocation of shares

Ordinary Shares issued following exercise of an option will rank, pari passu, with the Ordinary Shares thenin issue, save as regards dividends payable by reference to a record date prior to the date of issue. TheCompany will at all times keep available sufficient authorised and unissued Ordinary Share capital to satisfyoutstanding options. The holder of Ordinary Shares issued pursuant to the Share

Option Scheme shall not be entitled to sell more than 500,000 Ordinary Shares in any 12 month period ormore than 50,000 Ordinary Shares per calendar month. Ordinary Shares issued pursuant to the exercise ofan option granted under the Share Option Scheme shall be issued to a nominee appointed by the Companyfor the purposes of ensuring compliance with the foregoing restrictions and ensuring an orderly market inthe Ordinary Shares.

vii. Limits

The maximum number of Ordinary Shares which may be issued on the exercise of options shall not exceedin aggregate the number of ordinary shares which represent 10% in number of the Ordinary Shares in issuefrom time to time.

viii. Variation

The Board has power from time to time to vary the regulations for the administration and operation of theShare Option Scheme provided that such variation is not inconsistent with the provisions of the Share OptionScheme and, inter alia, does not operate to vary adversely the terms of any options granted prior to suchvariation. Further, the Board may at any time terminate the operation of the Share Option Scheme. Variationof the Share Option Scheme is not subject to prior Inland Revenue approval.

Details of Options granted under the Share Option Scheme are set out below:

24

1. Directors/Senior ManagementName Total Details Exercise Offer Listing (Directors No. of of Price Price Priceonly) Option Options (Pence) Option Exercise Period (Pence) (Pence) Variance

Carl Esprey 10,000,000 2,000,000 8.5 For a period of 5 years from the date 20 8.13 11.87on which the Company’s share price first reaches 20p

2,000,000 8.5 For a period of 5 years from the date 25 8.13 16.87on which the Company’s share price first reaches 25p




Lachlan Monro 10,000,000 2,000,000 8.5 For a period of 5 years from the date 20 8.13 11.87 on which the Company’s share price first reaches 20p



2,000,000 8.5 For a period of 5 years from the date on which the Company’s share price first reaches 35p 35 8.13 26.87


Barry Lobel 5,000,000 1,000,000 8.5 For a period of 5 years from the date 20 8.13 11.87on which the Company’s share price first reaches 20p





25

2. Senior Operational Management TeamTotal Details Exercise Offer Listing No. of of Price Price PriceOption Options (Pence) Option Exercise Period (Pence) (Pence) Variance

2,500,000 1,000,000 10p For a period of five years from the first anniversary of the date of grant

750,000 15p For a period of five years from the first anniversary of the date of grant

750,000 20p For a period of five years from the first anniversary of the date of grant

2,500,000 2,500,000 8.5p 7 April 2015 – 7 April 20201,000,000 In five 10p For a period of 5 years from the date

equal on which the Company’s share price tranches first reaches 20p 20 8.13 11.87

after 6 months

10p For a period of 5 years from the date on which the Company’s share price first reaches 25p 25 8.13 16.87




In five 10p For a period of 5 years from the dateequal on which the Company’s share price

tranches first reaches 20p 20 8.13 11.87after

18 months10p For a period of 5 years from the date

on which the Company’s share price first reaches 25p 25 8.13 16.87




In five 10p For a period of 5 years from the dateequal on which the Company’s share price

tranches first reaches 20p 20 8.13 11.87after

30 months10p For a period of 5 years from the date

on which the Company’s share price first reaches 25p 25 8.13 16.87



10p For a period of 5 years from the date on which the Company’s share pricefirst reaches 40p 40 8.13 31.87

26

3. ConsultantsTotal Details Exercise Offer Listing No. of of Price Price PriceOption Options (Pence) Option Exercise Period (Pence) (Pence) Variance

3,000,000 3,000,000 8p For a period of five years from the first anniversary of the date of grant

5,000,000 5,000,000 8p For a period of five years from 25 September 2014.

Note: Total number of options granted pursuant to the share option scheme as at the date of this Listing Statement is 39,000,000shares.

5.10 Corporate Governance

5.10.1 Corporate Governance PracticesGovernance is the means by which the affairs of an institution are directed and managed thereby promotingcorporate accountability and business aptness to achieve an optimal shareholder value, whilst simultaneouslytaking into consideration the interests of other stakeholders. It is premised on the principles of integrity,accountability, prudence and openness.

The Board is at the core of the Group’s system of corporate governance and is ultimately accountable andresponsible for the performance and affairs of the Company. Good corporate governance is regarded ascritical to the success of the business of the Group and the board is unreservedly committed to applyingthe fundamental principles of good governance – transparency, integrity, accountability and responsibility –in all dealings by, in respect of and on behalf of the Group.

The Company holds regular board meetings and the Board will be responsible for formulating, reviewingand approving the Group’s strategy, budgets and acquisitions.

The Board has an audit committee (the “Audit Committee”), a remuneration committee (the “RemunerationCommittee”) and a nomination committee (the “Nomination Committee”) with formally delegatedresponsibilities.

The Audit Committee comprises of at least two non-executive members of the Board, at least one of whomis independent. The Audit Committee’s main functions will include, inter alia, monitoring the integrity of theGroup’s financial statements (including its annual and half yearly reports and any other formal announcementrelating to its financial performance), making recommendations to the Board in relation to the appointmentof the Company’s auditors, overseeing the approval of their remuneration and terms of engagement andassessing annually their independence, objectivity and qualifications and the effectiveness of the auditprocess. Initially, a non-executive director (not being the Chairman) will act as chairman for the committeeand at least one other non-executive director will also be a member of the committee.

The Remuneration Committee comprises of at least two non-executive members of the Board, at least oneof whom is independent. The Remuneration Committee’s main functions include, inter alia, determining theframework or broad policy for the remuneration of the Company’s Chairman, the Company’s executivedirectors and other members of the executive management, the design of all share incentive plans and thedetermination each year of individual awards to executive directors and other senior executives thereunderand the performance targets to be used. Initially, a non-executive director (not being the Chairman) is actingas chairman of the committee and at least one other non-executive director is also a member of thecommittee.

The Nomination Committee comprises of at least two non-executive members of the Board, at least one ofwhom is independent. The Nomination Committee’s main functions include, inter alia, regularly reviewingthe structure, size and composition (including the skills, knowledge, experience and diversity) of the Boardand making recommendations with regard to any changes. Initially, a non-executive director (not being theChairman) is acting as chairman of the committee and at least one other non-executive director is also amember of the committee.

27

The Company has adopted a share dealing code for Directors and employees in accordance with the AIMRules and will take proper steps to ensure compliance by the Board and relevant employees. The sharedealing code will apply equally to Ordinary Shares listed on GEMS and AIM, following the Listing.

5.10.2 Composition of the Board of DirectorsThe Board includes a fair balance between executive and non-executive Directors so that no individual orcompany of individuals’ interests will dominate the Board’s decision making process. The following issuesare considered in determining the Board’s composition:

� Attaining a desirable ratio of and balance between the number of executive and non-executivedirectors.

� Ensuring that the Board collectively contains the skills, experience and mix of personalities appropriateto the strategic direction of the Company and necessary to secure its sound performance.

� Experience, knowledge, skills and personal attributes of current and prospective Directors in relationto the needs of the Board as a whole.

Irrespective of a Director’s special expertise or knowledge and regardless of whether a Director is anExecutive or Non-Executive Director, all members of the Board recognize that they are collectively responsibleto Shareholders for the performance of the Company.

The Board currently comprises of six Directors (four executive and two non-executive), and reflects a blendof different experiences and backgrounds.

5.10.3 Board Effectiveness and EvaluationEach director prepares sufficiently for meetings by carefully considering board papers and attachmentsthereto, and where necessary seeking clarifications. Where a director is unable to attend a meeting, eachdirector undertakes to communicate through the Chairman or the Chief Executive Officer any concerns orissues they would wish considered.

At regular intervals, not exceeding twelve months, the Board of Directors shall undertake an evaluation ofits functioning as a collective agency and as individual directors. Where necessary, the Board may obtainthe services of an external facilitator to guide the evaluation.

There are no formed arrangements or understandings with the majority shareholder, customers, suppliersor others, pursuant to which any person was selected as a Director or member of senior management.

5.10.4 Qualification Remuneration of the DirectorsA director need not be a member. A Director who is not a member shall nevertheless be entitled to attendand speak at shareholders’ meetings.

The Directors (other than alternate Directors) shall be entitled to receive by way of fees for their services asDirectors such sum as the Board may from time to time determine.

Any fees payable may be distinct from or compose part of any salary, remuneration for any office or otheramounts payable to a director pursuant to any other provisions.

The Directors shall be entitled to be repaid all reasonable travelling, hotel and other expenses properlyincurred by them in or about the performance of their duties as Directors, including expenses incurred inattending meetings of the Board or any committee of the Board or general meetings.

5.10.5 Responsibilities of the BoardThe Board specifically exercise leadership, enterprise, integrity and judgment in directing the affairs of theCompany in order to achieve continuing prosperity for the Company and its Shareholders, and shall at all

28

times act in the best interests of the Company in a manner based on transparency, integrity, accountabilityand responsibility.

The Board will:

� Determine the business strategies and plans that underpin the corporate strategy.

� Discuss and approve strategic plans and annual budgets.

� Monitor Management’s implementation of the strategic plans and financial objectives as defined bythe Board.

� Continually monitor the exercise of delegated power by Management.

� Ensure that a comprehensive system of policies and procedures is in place, and that appropriategovernance structures exist to ensure the smooth, efficient and prudent stewardship of the Company.

� Ensure that the business of the Company is managed with a view to ensuring that the Company isethical in all its dealings and exercises corporate social responsibility.

� Ensure compliance by the Company with all relevant laws and regulations, audit and accountingprinciples and such other principles as may be established by the Board from time to time.

� Identify key risks, opportunities and strengths relating to the Company.

� Ensure that the Company’s organizational structure and capability are appropriate for implementingthe chosen strategies.

� Set policies on internal control and obtain regular assurance that the system is functioning effectivelyand is effective in managing risks.

� Nominate board members who will add value to the board processes and arrange for their induction.

� Appoint the management, senior staff, external auditors and other consultants.

� Discuss, agree and approve annual accounts and reports.

� Communicate key policies and strategy issues to senior management.

� Identify all stakeholders and ensure effective communication with Shareholders and stakeholders.

5.10.6 Board CommitteesThe Board has established the following three (3) committees, whose mandates and terms of reference arespelt out as follows:

i. Audit committee

The Audit Committee is a standing committee of the Board and its purpose is to assist the Board inassessing the integrity of financial statements and the effectiveness of financial reporting, and to conductrisk management assessment. The composition of the committee is as follows:

� Jonathan Wright (Chairman)

� Ian Mann

� Representative of Burbidge Capital (Nominated Advisor)

29

ii. Remuneration committee

The Remuneration Committee is a standing committee of the Board and its purpose is to assist the Boardof ADSS in determining the framework or broad policy for the remuneration of the Company’s directors andmembers of the executive management, the design of all share incentive plans and the determination eachyear of individual awards to directors and other staff thereunder and the performance targets to be used.

The composition of the committee is as follows:


� Ian Mann

iii. Nomination committee

The Nomination Committee is a standing committee of the Board and its purpose is to assist the Board ofADSS in respect of matters relating to composition of the Board.

The composition of the committee is as follows:


� Ian Mann

In addition to the Audit and Remuneration committees, the Board intends to monitor the development ofthe Group and will, subject to relevant advice, consider establishing additional committees (with authority inrespect of topics such as risk management, finance, investments and governance) as are necessary andcommensurate given the size and stage of development of the Company.

It is intended that the Company shall appoint, in due course, a third Non-Executive Director and thisNon-Executive Director will sit on each of the three Board Committees

5.10.7 Other Important Information

i. Director emoluments and benefits

The aggregate directors’ emoluments and benefits for Atlas Development & Support Services for the fullyears ended 30 June 2013 and 2014 are as follows:

2014 2013$’000 $’000

Directors’ Fees (in USD thousands) 315 4

Source: Management and Company records

There are no arrangements whereby any of the Directors have or have agreed to waive future emolumentsand there has been no arrangement for the waiver of emoluments during the past financial year.

ii. Director Service contract arrangements

The Directors service contracts/letter of appointment have been made available for inspection and will bepart of the accompanying documents to this Listing Statement.

Some of the key terms of the service contracts are:

� The performance of individual directors and the board and its committees is evaluated annually.

� A director and an officer must comply in all respects with any rule of law or code of best practiceapplicable to his/her role as a director or officer of the company.

30

6. OPERATIONAL AND FINANCIAL REVIEWThis section is to be read in conjunction with this Listing Statement as a whole, including, in particular, therisk factors discussed in the section “Key Risk Factors” set out in section 7, audited financial statements forboth Atlas Development & Support Services and Ardan Risk & Support Services in Appendix II of thisdocument, and the reporting accountant’s report in Appendix III of this document.

6.1. Atlas Development and Support Services LimitedThe following are extracts of the audited financial statements of Atlas Development & Support ServicesLimited for the years ended 30 June 2013 and 30 June 2014.

As previously mentioned, Atlas purchased a 49 per cent. stake in Ardan Risk & Support Services in August2013, and exercised the call option to acquire the remaining 51 per cent. in October 2014. As such, thefinancial statements for Atlas for the year ended 30 June 2014 incorporates 49 per cent. of Ardan fromAugust 2013 to June 2014 only, and is shown under the line ‘share of results of associate’.

In addition, and as can been seen in the comparative accounts of Ardan, in January 2014 Atlas implementeda restructuring of Ardan which resulted in the turnaround performance of Ardan during the first six monthsof 2014, in which the business transformed from losses of -US$3.7m in 2013, to profits after tax of+US$4.3m in the first 6 months of 2014.

Consequently, when viewing the financials of Atlas it is worth noting that the values included for Ardan forthe year ended 2014, include the results from Aug-Dec 2013 which were prior to the restructuring of Ardanas detailed above. In addition, from October 2014, Atlas owns 100 per cent. of Ardan, so 100 per cent. ofthe profits will be consolidated into Atlas from this date going forward.

i) Atlas Development & Support Services Limited Consolidated Statement of Comprehensive Income(year end 30 June).

2014 2013$’000 $’000

CONTINUING OPERATIONSRevenue – –Cost of sales – –

Gross Profit – –

Operating expenses (2,521) (155)Operating loss (2,521) (155)

Finance income 28 –Depreciation and Amortisation (7) –

Share of results of associate 1,075 –Loss before taxation (1,425) (155)

Income tax expense – –Loss for the year from continuing operations (1,425) (155)

Loss for the year attributable to owners of the parent company (1,425) (155)Loss for the year attributable to non-controlling interests – –

(Loss)/Earnings per ShareBasic & Diluted Loss per share from continuing operations (0.04) (0.01)

Source: Company Records

31

ii) Atlas Development & Support Services Limited Consolidated Statement of Financial Position (year end30 June).

2014 2013$’000 $’000

ASSETSNon-current assetsProperty, plant & equipment 174 –Investment in Subsidiaries 3 –Interest in Associate 5,075 –Loans and other receivables 8,545 –

–––––––––––– ––––––––––––

Total non-current assets 13,797 ––––––––––––– –––––––––––––––––––––––– ––––––––––––

Current assetsTrade and other receivables 2,369 871Cash and cash equivalents 3,132 9,162

–––––––––––– ––––––––––––

Total current assets 5,501 10,033–––––––––––– ––––––––––––

TOTAL ASSETS 19,298 10,033–––––––––––– –––––––––––––––––––––––– ––––––––––––

LIABILITIESNon-current liabilitiesLong-term borrowings – –

–––––––––––– ––––––––––––

Total non-current liabilities – ––––––––––––– –––––––––––––––––––––––– ––––––––––––

Current liabilitiesShort-term borrowings (115) (28)Trade and other payables (262) (508)

–––––––––––– ––––––––––––

Total current liabilities (377) (536)–––––––––––– ––––––––––––

TOTAL LIABILITIES (377) (536)–––––––––––– ––––––––––––

NET ASSETS 18,921 9,497–––––––––––– –––––––––––––––––––––––– ––––––––––––

EQUITYIssued capital 20,508 9,652Foreign Exchange Reserve (7) –Retained earnings (1,580) (155)

–––––––––––– ––––––––––––

Total equity attributable to the equity holders of the parent company 18,921 9,497–––––––––––– ––––––––––––

Non-controlling interests – ––––––––––––– ––––––––––––

TOTAL EQUITY 18,921 9,497–––––––––––– –––––––––––––––––––––––– ––––––––––––


32

iii) Atlas Development & Support Services Limited Consolidated Statement of Cash Flows (year end30 June).

2014 2013$’000 $’000

CASH FLOWS FROM OPERATING ACTIVITIESLoss before tax (1,425) (155)

Working Capital Adjustments:– Depreciation of property, plant and equipment 7 –– Share of Associates profit (1,075) –– Net interest income (28) –

–––––––––––– ––––––––––––

Operating cash flow before movements in working capital (2,521) (155)–––––––––––– –––––––––––––––––––––––– ––––––––––––

Working capital adjustments:– Increase in receivables (1,498) (871)– (Decrease)/Increase in payables (159) 536

Cash used in operations (4,178) (490)Interest received 28 –

–––––––––––– ––––––––––––

Net cash used in operating activities (4,150) (490)–––––––––––– –––––––––––––––––––––––– ––––––––––––

CASH FLOWS FROM INVESTING ACTIVITIESPurchase of property, plant and equipment (181) –Purchase of subsidiary, net of cash received (3) –Increase in loans to associate (8,545) –

–––––––––––– ––––––––––––

Net cash used in investing activities (8,729) ––––––––––––– –––––––––––––––––––––––– ––––––––––––

CASH FLOWS FROM FINANCING ACTIVITIESProceeds from issue of share capital 7,392 10,108Share issue costs (536) (456)

–––––––––––– ––––––––––––

Net cash flow from financing activities 6,856 9,652–––––––––––– –––––––––––––––––––––––– ––––––––––––

Net (decrease)/increase in cash and cash equivalents (6,023) 9,162

Cash and cash equivalents at start of the period 9,162 –Effect of foreign exchange rate changes (7) –

–––––––––––– ––––––––––––

Cash and cash equivalents at end of the period 3,132 9,162–––––––––––– –––––––––––––––––––––––– ––––––––––––


6.2. Ardan Risk & Support Services LimitedThe following are extracts of the audited financial statements of Ardan Risk & Support Services Limited forthe years ended 31 December 2012 and 31 December 2013, plus the interim audited statements for thesix-months ended 30 June 2014.

As already mentioned, Atlas implemented a restructuring of Ardan in January 2014 to improve operationalmanagement and implementation, planning and reporting. This included simplifying the operational structureinto 3 separate business divisions, recruiting highly qualified divisional leadership to run the business,recapitalizing the business by way of loans from Atlas, renegotiating loss making contracts, and theimplementation of new systems and controls which included the identification and elimination of costsinefficiencies.

The results of this restructuring are clearly evident in the turnaround performance of Ardan during the firstsix months of 2014, in which the business has transformed from losses of -US$3.7m in 2013, to profitsafter tax of +US$4.3m in the first 6 months of 2014.

33

i) Ardan Risk & Support Services Limited Consolidated Income Statement.

2014 2013 2012Audited Audited Audited$’000 $’000 $’000

Revenue 20,277 22,487 15,511 Cost of sales (12,079) (18,421) (11,773)

–––––––––––– –––––––––––– ––––––––––––

Gross profit 8,198 4,065 3,738 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Gross Profit Margin 40% 18% 24%

Other income 224.01 54.67 47.97 ExpenditureEmployment costs (1,174) (3,184) (1,315)Administration expenses (1,181) (2,782) (1,449)Establishment expenses (1,092) (1,766) (948)Selling and distribution expenses – – (0.2)

–––––––––––– –––––––––––– ––––––––––––

Operating (loss)/profit 4,976 (3,612) 74 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Operating Profit Margin 25% (16)% 0%

Finance costs (343) (100) (118)–––––––––––– –––––––––––– ––––––––––––

Profit (loss) before income tax 4,633 (3,711) (44)–––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

PBT Margin 23% (17)% 0%

Income tax charge (316) – (129)–––––––––––– –––––––––––– ––––––––––––

Profit (loss) for the year attributable to shareholders 4,317 (3,711) (173)–––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

PAT Margin 21% (17)% (1)%


Margins

Gross Profit Margins 40% 18% 24%Operating Profit Margin 25% (16)% 0%PBT Margin 23% (17)% 0%PAT Margin 21% (17)% (1)%


34

ii) Ardan Risk & Support Services Limited Consolidated Statement of Financial Position.


AssetsNon-Current AssetsProperty, plant and equipment 6,765 6,066 2,139 Intangible assets 47 – –Prepaid operating lease rentals 44 53 59 Deferred Tax Asset 276 – –

–––––––––––– –––––––––––– ––––––––––––

Total Non-Current Assets 7,131 6,120 2,198 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Current AssetsInventory 402 290 –Trade and other receivables 11,203 7,051 4,619 Cash and cash equivalents 2,055 763 389 Tax recoverable 3 – –

–––––––––––– –––––––––––– ––––––––––––

Total Current Assets 13,663 8,104 5,008 –––––––––––– –––––––––––– ––––––––––––

Total Assets 20,794 14,223 7,207 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Equity and LiabilitiesCapital and reservesIssued capital 49 49 49 Branch capital contribution 206 – –Retained earnings 1,271 (3,976) 1,189 Minority interest – – (59)

–––––––––––– –––––––––––– ––––––––––––

Total Capital and reserves 1,526 (3,926) 1,180 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Non Current LiabilitiesBorrowings 955 1,274 821 Deferred tax liability – 129 129 Due to related parties 8,744 5,888 338 Directors 755 69 272

–––––––––––– –––––––––––– ––––––––––––

Total Non current liabilities 10,454 7,360 1,561 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Current LiabilitiesTrade and other payables 7,835 9,224 3,717 Borrowings 979 1,318 429 Tax payable – 248 320

–––––––––––– –––––––––––– ––––––––––––

Total current liabilities 8,814 10,790 4,466 –––––––––––– –––––––––––– ––––––––––––

Total equity and liabilities 20,794 14,223 7,207 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––


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iii) Ardan Risk & Support Services Limited Consolidated Statement of Cash Flows.


Operating ActivitiesReconciliation of operating (loss) /Profit to net cash outflow in operating activitiesOperating loss before taxation 4,632.93 (3,711.04) (44.33)Add back:Depreciation of property, plant and equipment 595.51 1,240.63 530.61 Amortisation of operating lease 2.925 6.038 6.603 Amortisiation of intangible assets 5.27 – –Tax paid (92.06) (71.63) (109.46)Loss/(gain) on disposal of property, plant and equipment – 299.38 (46.66)Non - Controlling interest – 58.71 –Translation difference 145.52Net loss on discontinued entity (912.71) –Prior year adjustments – (541.22) –

–––––––––––– –––––––––––– ––––––––––––

5,290.1 (3,631.8) 336.8 –––––––––––– –––––––––––– ––––––––––––

Changes in working capitalIncrease in trade and other receivables (112.93) (2,432.22) (1,891.75)Increase in inventories (4,152.09) (289.51) 18.65 Increase in trade and other payables (1,389.20) 5,507.04 1,990.25

–––––––––––– –––––––––––– ––––––––––––

Net cash generated from operating activities (365.14) (846.52) 453.93 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Investing ActivitiesProceeds from disposal of property, plant and equipment – – 128.06 Purchase of intangible asset (52.65)Purchase of operating lease – – (66.03)Purchase of property, plant and equipment (1,382.60) (5,467.43) (1,752.36)

–––––––––––– –––––––––––– ––––––––––––

Net cash used in investing activities (1,435) (5,467) (1,690)–––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Financing ActivitiesBranch reserve requirment 206.0 – –Issue of shares – – 49.2 Borrowings (574.1) 1,254.7 1,250.5 Related party balances 2,856.07 5,549.77 311.27 Directors account 686.32 (203.09) (257.81)

–––––––––––– –––––––––––– ––––––––––––

Net cash generated from financing activities 3,175.29 6,601.34 1,353.17 –––––––––––– –––––––––––– ––––––––––––

Net increase in cash and cash equivalents 1,375.91 287.39 116.77 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––

Movement in cash and cash equivalentsAt start of the year 0.68 389.39 272.61 Movement during the year 1,375.91 287.39 116.77

–––––––––––– –––––––––––– ––––––––––––

At end of year 1,376.58 676.77 389.39 –––––––––––– –––––––––––– –––––––––––––––––––––––– –––––––––––– ––––––––––––


6.3. Trading UpdateAtlas Development & Support Services Limited continues to make excellent progress in the development ofits business following the acquisition of Ardan’s support services operations, primarily in Kenya. With therestructuring programme complete, trading is in line with expectations and revenue growth is trendingpositively.

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On the ground developments include the mobilisation of Red Sea containerised accommodation in theTurkana region, where the Company is currently supporting a number of international companies operatingin the region. Additionally, the development of the Lockichar site has commenced which provides theCompany with a key differentiator to other service providers.

On a broader level, the Company continues to make advancements with regards to increasing its serviceoffering and general capabilities to support resource development in East Africa. In line with this, strongprogress has been made with regards to new business initiatives, with a number of significant proposalsand tenders currently live.

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7. KEY RISK FACTORSAn investment in Ordinary Shares involves a high degree of risk. Investors should carefully consider the risksdescribed in this and all other information contained in this document before making a decision as to whetherto invest in the Ordinary Shares.

The Board considers the following risks and other factors to be the most significant for potential investorsin the Company, but the risks listed do not necessarily comprise all those associated with an investment inthe Company and are not set out in any particular order of priority.

If any of the following risks actually occur, the Company’s business, financial condition, trading performanceand prospects may be substantially adversely affected and the future business success of the Companyand/or achievement of the Company’s strategic objectives could be endangered. In such cases, the tradingprice of the Ordinary Shares could decline and investors may lose all or part of their investment.

Additional risks and uncertainties not currently known to the Board may also have an adverse effect on theCompany’s business and the information set out below does not purport to be an exhaustive summary ofthe risks affecting the Company. Potential investors are accordingly advised to consult an investmentprofessional who specialises in advising on investments of this kind before making any investment decisions.A prospective investor should carefully consider whether an investment in the Company is suitable in thelight of his or her personal circumstances and the financial resources available to him or her. Any referencein this Part to “the Company” shall be deemed, where appropriate, to be a reference to the Enlarged Groupin relation to the period following completion of the Listing.

7.1. Risks relating to the Company’s business7.1.1 Reliance on key clientsThe Company’s business relies on various key contracts, the vast majority of which are with a single client.If the Company’s client relationships broke down it could have a material adverse effect on the Company’sbusiness, operations and financial position. The Board intends to continue to maintain close customer-supplier relationships which the Directors believe would reduce the risk of losing its key client.

As contemplated in the Framework and Option Agreement entered into with Ardan Risk & Support Services,certain client contracts will be novated to ALK, however there can be no guarantee that the Company willbe successful in novating all suitable contracts, since such novations are reliant on obtaining the consent ofthe contractual counterparty. The failure of the Company to successfully novate these client contracts onacceptable terms may again have a material adverse effect on the Company’s business, operations andfinancial position.

The Company maintains close customer-supplier relationships with its key clients. The Company intends tobroaden its client base going forward so as to minimise the potential effects of exposure to over-reliance ona small number of key clients. This will be achieved by seeking and winning contracts throughout the EastAfrican region.

7.1.2 Management of future growth There can be no assurance that the Company will be able to manage effectively the expansion of itsbusiness, and to expand and strengthen its current systems, procedures and controls to support its futureoperations. Any failure of management to manage effectively the Company’s growth and development couldhave a material adverse effect on its business, financial condition and results of operations. There is nocertainty that all or, indeed, any of the elements of the Company’s current strategy as described in thisdocument will be delivered.

The Company may, from time to time, seek to undertake strategic acquisitions or investments in otherbusiness opportunities. However, there can be no guarantee that the Company will be able to identify futuresuitable opportunities or, if such opportunities are identified, consummate such acquisition or investmentson acceptable terms or integrate acquisitions or other collaborations into its existing business or successfullyrealise the growth expected from such opportunities. To the extent that the Company encounters suchproblems, its business, operating results or financial position could be adversely affected.

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The failure of the Company to continue to improve and upgrade its systems, procedures and controls,develop new and existing disciplines, integrate new operations or otherwise manage growth successfullymay have a material adverse effect on the Company’s and the Company’s business, financial condition andresults of operations.

To mitigate the risk of managing future growth, the board of directors and senior management carefullyformulate strategic and business plans, in addition to putting in place and thereafter monitoring, improvingand upgrading its systems, procedures and controls over time.

7.1.3 Geographically spread operationsThe Company operates its business in a range of international locations and it is expected that furthergeographical expansion of the Company’s business into new locations will take place in the future. Throughits international presence, the Company is subject to increased risk from a number of legal, economic andmarket factors which could have an adverse effect on the ability of the Company to provide services in thoseareas, or to continue to expand its business geographically. Such risks include:

� increased expenses due to the requirement in some countries that business be conducted throughlocal agents;

� reversal of existing policies (including favourable tax and lending policies) encouraging foreigninvestment or foreign trade by the governments of countries in which the Company operates;

� changes in and difficulties in complying with laws and regulations of different countries, including taxand labour laws; restrictive actions by local governments, including the imposition of tariffs andlimitations on imports or exports; political instability; fraud conducted by the Company’s employees,subcontractors, service providers, clients’ employees or those of third parties, or any personsunconnected with any of the foregoing; nullification, modification or renegotiation of contracts; andexpropriation of assets.

The occurrence of any of these events could have a material adverse effect on the financial condition andresults of operations of the Company and the Company. In addition, the geographical spread of theCompany’s operations means co-ordination of effort and communications with employees are subject tocertain challenges, which could lead to inefficient allocation of resources or duplication of effort. Furthermore,distance from the Company’s principal locations can make it more difficult to implement and impress uponlocal workforces the Company’s policies on matters such as health and safety and can present challengesin the supervision of the Company’s sub-contracted employees. Failure to deliver consistently high standardsacross all of its fields of operations could create risks for the Company, including reputational risks.

The democratic processes prevailing in the countries that the Company operates, and support from theinternational community for the region’s political systems reduces the risk of significant political unrest. Whilethe Group has systems, controls and procedures designed to mitigate political risk, there can be noassurance that any adverse political events will not have a negative impact on the Group’s business.

7.1.4 Terms of client contractsMany of the clients which the Company seeks to service are companies with substantially strongernegotiating positions. No assurances can be given that the Company’s future contracts will not create newonerous or unusual obligations in addition to those already present in the existing agreements, nor that theCompany will always be able to negotiate such terms to obtain a favourable result for the Company.

The Company always tries to negotiate contracts in such a manner that will not result in onerous or unusualobligations to the company.

7.1.5 Potential liability claims due to the hazardous nature of its businessThe Company engineers and constructs large industrial facilities in which an accident or a service failurecould cause personal injury, loss of life, damage to property, equipment or the environment, consequentiallosses and/or suspension of operations. The Company may also be liable for acts and omissions ofsub-contractors which cause such loss or damage. The Company’s insurance and contractual limitationson liability may not adequately protect it against liability for such events, including events involving pollution,

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or against losses resulting from business interruption. In addition, indemnities which the Company receivesfrom sub-contractors may not be easily enforceable. Moreover, the Company may not be able to maintaininsurance at levels that it deems adequate or ensure that every contract contains and has properlyincorporated adequate limitations on liabilities. Any claims made under its insurance policies are likely tocause the Company’s premiums to increase.

Any future damage caused by the Company’s services that are not covered by insurance, are in excess ofpolicy limits, are subject to substantial deductibles or are not limited through adequate contractual limitationsof liability may have a material adverse impact on the Company’s cash available for operations, financialcondition and results of operations may be adversely affected. See further information on ‘insurance’ laterin this section 7.

The Company has insurance policies in place; in addition to these, implementing proper controls andprocedures when performing contracts helps the company avoid accidents personal injury, loss of life,damage to property, equipment or the environment, consequential losses and/or suspension of operationsthat may arise due to the nature of the Company business.

7.1.6 Lump sum contracts won through competitive tender processesThe Company operates in markets where a significant proportion of its projects are won through competitivetender processes and price can often be a major factor in tender awards. If competition were to intensify inthe future, particularly should larger, international competitor companies begin to focus more on the sameclients, but also geographies of the Company, the number of tenders meeting the Company’s current margincriteria could decline and the Company’s financial condition and results of operations may be adverselyaffected.

In a number of the Company’s operations where contracts are typically charged on a lump sum basis, thecontractor assumes the risk of cost overruns or increased expenditure on labour or materials unless theyare specifically catered for in the contract or agreed to as a change order by the customer. If the costs ofmaterials, labour or equipment hire rise, the profitability of an individual project and also the Company’sfinancial condition and results of operations may be adversely affected. Similarly if the Company is unableto accurately predict expenditure on a given project or to operate within budgets agreed with its customers,its financial condition, results of operations and reputation may be adversely affected.

Cancellations of projects or delays in completion of contracts could affect the revenue, cash flow andearnings actually recognised from contracts reflected in the Company’s financial statements, and in certaincircumstances may result in a reduction, reversal or elimination of previously reported revenues or earnings.In the event of project cancellation, the Company may have no contractual right to the total revenuesreflected in its financial statements other than reimbursement for certain costs. If the Company were toexperience significant cancellations or delays of projects in its financial statements, its financial conditionand results of operations may be adversely affected.

The Company’s contracts with its customers may contain provisions requiring the Company to pay liquidateddamages in relation to any delays in completing projects. Any cost overruns borne by the Company, or anydelays resulting in liquidated damages payments, may cause the contract to be less profitable thananticipated or result in the Company incurring losses.

The Company always tries to negotiate contracts won through competitive tender processes, in such amanner that will not result in onerous or unusual obligations to the Company.

7.1.7 Early termination, variation, alternative interpretation or renegotiation of client contractsThe Company’s client contracts, in common with the industry standard, may provide for early terminationby the client upon default or non-performance by the Company or following a specified notice period.

A majority of the Company’s client contracts also provide for variation under specified circumstances. Suchcircumstances may include changes in the project design or schedule or changes in the scope of work.While the amount charged by the Company for such variations is usually negotiated at the time of variation,in some circumstances, the amount or the basis for determining the amount may be specified in the initialcontract, which may result in the Company being unable to recover the full cost of such variations.

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In addition, the Company’s clients may have a different interpretation of certain terms included in theircontracts to that of the Company or to that which a court may apply. The Company’s clients may also seekto renegotiate contract terms so as to be more favourable to the client, particularly during economicdownturns or when industry conditions deteriorate. The Company may agree to such alternativeinterpretations or renegotiations in order to avoid contract terminations or legal costs or to maintain clientrelationships.

Contract terminations, variations, alternative interpretations and renegotiations may result in anticipatedrevenue, being realised later than anticipated or not at all, and may also result in unanticipated costs, suchas the costs associated with renegotiating contracts, being borne by the Company. The occurrence of anyof these events may have a material adverse effect on the Company’s results of operations, financial conditionand prospects.

The Company may seek to charge for such variations, although such amounts are not provided for in theinitial contract, which partly help the Company cover itself from any early termination, variation, alternativeinterpretation or renegotiation of client contracts.

7.1.8 Liability to clients under warrantiesThe Company provides warranties as to the services it provides and the buildings it constructs, and as tothe proper operation and adherence to specifications of the engineering, equipment and constructions itdesigns, purchases, modifies or builds. Failure of the equipment to operate properly or to meet specificationsmay increase the Company’s costs by requiring additional engineering resources and services, replacementof parts and equipment, rebuilding or renovation or monetary reimbursement to a client. Furthermore, thesefailures may cause significant and costly damage to the equipment or building.

To the extent that the Company incurs substantial warranty claims, its reputation, ability to obtain futurebusiness and results of operations, financial condition and prospects could be materially and adverselyaffected, although such risks may be mitigated by negotiation.

Although such risk may be mitigated through negotiations, the Company has continuously improved in itsquality of work and continues to do so through proper training and education of staff.

7.1.9 Actions of the Company’s own workforce and that of third partiesThe Company’s performance on projects may be subject to delays or additional cost due to authorised andunauthorised actions taken by unions or other organised labour forces in terms of both the Company’s ownworkforces and the workforces of other contractors. The Company has not experienced any recentprolonged industrial action and is not aware of any such impending action among the Company’s employeesor sub-contractors, but recognises that in the regions where the Company operates, industrial action andassociated civil unrest can cause delays and difficulty performing contracts.

The Company often relies on inputs from third-party equipment manufacturers and sub-contractors for thecompletion of its projects. To the extent that the Company cannot engage sub-contractors or acquireequipment or materials according to its plans and budgets, its ability to complete a project in a timely fashionor at a profit may be impaired. If the amount the Company is required to pay for these goods and servicesexceeds the amount estimated in bidding for lump sum work, the Company could experience losses underthe relevant contracts. In addition, if a sub-contractor or a manufacturer is unable to deliver its services,equipment or materials according to the negotiated terms or on time, the Company may be required topurchase such services, equipment or materials from another source at a higher price.

There may also be unforeseen and unpredictable delays to services resulting from factors outside the controlof the Company’s own workforce, third parties, sub-contractors and manufacturers. The resulting additionalcosts may be substantial, and the Company may be required to compensate the project customer for delays.Further, the Company may not be able to recover any or all of these costs in all circumstances, which mayreduce the profit to be realised or result in a loss on a project for which the services, equipment or materialswere needed.

The Company may bid for a particular contract jointly as part of a consortium or with joint venture partner(s).In these circumstances, the Company’s ability to maximise the profitability of any contract awarded to it may

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be adversely affected by the performance of its consortium or joint venture partner(s). In addition, theCompany may be dependent on the expertise of partners in assessing certain of the costs of the contract.To the extent such costs are inaccurately calculated in relation to lump sum contracts, the Company maybe exposed to its share of any cost overruns of the consortium or joint venture, which could have a materialadverse effect on the prospects, financial condition and results of operations of the Company.

In certain circumstances, the Company may be jointly and severally liable for the acts or omissions of itsconsortium or joint venture partners. This may arise under the terms of the consortium or joint venturearrangement or because the Company is exposed to the losses of any consortium or joint venture vehicle.In addition, the Company may in certain circumstances accept primary liability by way of a separateguarantee for the overall performance of the contract where it is only providing part of the goods or servicesto the client. If a client pursued claims against the Company or against a consortium or joint venture vehicleas a result of the acts or omissions of the Company’s partners, the Company’s ability to recover from suchpartners may be limited. Recovery under such arrangements may involve delay, management time, costsand expenses or may not be possible at all, which could adversely affect the Company’s prospects, financialcondition and results of operations.

The Company has not experienced any prolonged industrial action and this has mainly been because ofproper mechanisms that address employees’ grievances whenever they arise.

7.1.10 Work stoppages and other labour problemsThe laws of certain jurisdictions make striking and the formation of unions unlawful, whereas in otherjurisdictions striking and the formation of unions is lawful in certain circumstances. In addition in certain otherjurisdictions in which the Company operates, or may operate in the future, collective wage bargaining andorganised labour representation are common and industrial action more frequent. A lengthy strike or otherwork stoppage at any of the projects on which the Company is working could have a material adverse effecton the Company’s ability to conduct its activities and complete its contractual obligations. In addition, theCompany may encounter delays and interruptions caused by industrial action affecting its sub-contractorsor suppliers, or by political interference or local community action. Any such delays, stoppages orinterruptions could have a material adverse effect on the Company’s prospects, financial condition andresults of operations.

The Company has not experienced any recent prolonged industrial action and is not aware of any suchimpending action among the Company’s employees or sub-contractors but recognises that in the regionswhere the Company operates, industrial action and associated civil unrest can cause delays and difficultyperforming contracts.

As stated above, the Company has not experienced any prolonged industrial action and this has mainlybeen because of proper mechanisms that address employees’ grievances whenever they arise.

7.1.11 Client credit riskThe Company provides its services to a variety of clients and is therefore subject to the risk of non-paymentfor services it has rendered or non-reimbursement of costs it has incurred. The contracts which the Companyenters into may require significant expenditure by the Company prior to receipt of relevant payments fromthe client and expose the Company to potential credit risk. In addition, the Company is open to the risk thatits clients may take a strict contractual approach to performance of key performance indicators regardlessof the overall success of the project. In these situations, local management intervention is often required inorder to obtain payment.

The Company has not recently experienced any significant client credit events and the Directors are notaware of any such impending events. Nevertheless, failure by any of its clients to pay for services providedor reimburse costs incurred by the Company in the future could have a material adverse effect on theCompany’s cash flow and on the profitability of the relevant contract for the Company.

The Company has over the years implemented strict credit policies but this mainly depends of the creditworthiness of a client, with good credit worthy clients obtaining better terms from the company.

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7.1.12 Dependence on licences, registrations, certifications, accreditations and reputationCertain business operations of the Company are dependent on various licences, registrations andcertifications and accreditations. The Company has policies in place so that it is aware of relevant regulatoryrequirements and best industry practices so as to ensure that the quality of services provided by theCompany is maintained at a satisfactory level. Nevertheless the ability to obtain, sustain or renew licences,registrations, certifications and accreditations on acceptable terms is subject to changes in regulations andpolicies and to the discretion of applicable governmental authorities.

If such licences, registrations, certifications and accreditations cannot be obtained or renewed, the Companywould not be able to carry out all or part of its business. This may have a material adverse impact on someor all of the Company’s business.

The Company has policies in place so that it is aware of relevant regulatory requirements and best industrypractices so as to ensure that the quality of services provided by the Company is maintained at a satisfactorylevel.

7.1.13 Rising labour and raw materials costsCertain of the Company’s costs, in particular wages and the price of raw materials, are sensitive to rises ingeneral price levels in the markets in which the Company operates. However, due to competitive pressures,if the Company’s costs continued to increase, the Company may not be able to pass along those costs toits clients, which could have a material adverse effect on the Company’s business, results of operations andfinancial condition.

The Company may seek to pass increasing the costs to its clients in appropriate circumstances.

7.1.14 Consolidation among oil and gas companies and increased competitionConsolidation among oil and gas companies, farm-ins and joint operating agreements, may result in fewerpotential clients for the Company. This may lead to increased competition to secure contracts. Furthermore,mergers and acquisitions may result in the acquisition of a client of the Company by an entity which doesnot have a policy of outsourcing services or which has established relations with a competitor of theCompany. A reduction in demand for the Company’s services as a result of merger and acquisition activitymay have a material adverse effect on the Company’s financial performance and condition.

The Company has strategically built its capacity and reputation to bid for contracts as more competition isexpected in future in addition to diversifying into new untapped markets.

7.1.15 Environmental risksWhile the Company believes that it will be able to effect any future projects in substantial compliance withall relevant material environmental, health and safety laws and regulations, there can be no assurance thatnew laws and regulations, or amendments to or stringent enforcement of existing laws and regulations willnot be introduced, which could have a material adverse impact on the Company.

Environmental legislation generally provides for restrictions and prohibitions on spills, releases or emissionsof various substances produced in association with certain mining industry operations which would resultin environmental pollution. A breach of such legislation may result in the imposition of fines and penalties orother enforcement actions, which may have an adverse effect on the Company’s business. There can beno assurance that compliance with these laws and regulations or future laws and regulations will not involvesignificant expenditure by the Company which could have a material adverse effect the results of operationsor financial condition of the Company.

In addition, the Company’s future projects may be subject to laws and regulations regarding environmentalmatters and the discharge of hazardous waste and materials. The potential for liability is a risk. Costs maybe incurred in environmental rehabilitation, damage control and losses.

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The Company has policies in place so that it is aware of environmental regulatory requirements and/oramendments best industry practices so as to ensure that it does not breach any of the environmentallegislation.

7.1.16 Operational and technical risksA range of factors may affect the current and future operations of the Company, including appraisal andpossible production activities, start-up risks, limitations on activities due to exceptional weather patterns,alterations to joint venture programmes and budgets, unanticipated operational and technical difficultiesencountered in production activities, mechanical failure of plant and equipment, adverse weather conditions,environmental accidents, industrial disputes, unavailability of processing equipment, unexpected shortagesor increases in the costs of consumables, spare parts, plant and equipment, prevention of access by reasonof political unrest, outbreak of hostilities, inability to obtain consents or approvals, contracting risk from thirdparties providing essential services, potential problems in locating and securing the services in a timely andcost effective fashion of appropriately skilled employees, consultants, contractors or processors.

Operational risks will exist as long as the Company is in operation, but management has ensured that aneffective, integrated operational risk management framework is in place. This includes the following:

� each department has defined roles and responsibilities with regard to operational risk management.

� key risks are identified, assessed, controlled and reported on a continuous basis using appropriatetools and methodologies.

� operational systems and procedures are subjected to reviews.

7.1.17 InsuranceInsurance of all risks associated with operating in the oil and gas (and similar) industries is not always availableand, if available, the cost can be high. The Directors will endeavour to put insurance in place that isconsidered appropriate for the Company’s needs. The Company may not be insured against all possiblelosses, either as a result of the unavailability of adequate cover or because the Directors finding the premiumsexcessive relative to the aggregate benefits.

The occurrence of significant events against which the Company is not, or is not fully, insured, or a numberof lesser events against which the Company are fully insured but subject to substantial deductibles, couldmaterially and adversely affect the business, financial condition and results of operations of the Company.The Directors will continue to review the insurance cover in place to ensure that it is adequate andappropriate.

As part of operational risk management policy, the Company aims to ensures that appropriate insurancepolicies to cover risks such as fire, theft and burglary are undertaken with reputable insurance companies.

7.1.18 Dependence on key personnelThe Company’s business will become dependent on retaining the services of a small number of keypersonnel and consultants as the business develops. Furthermore, the success of the Company will bedependent on the expertise and experience of the Directors. The loss of one or more of those key individualscould have a material adverse effect on the Company.

The Company ensures continuous training of its employees with the objective of ensuring its work force isproperly skilled and continuously safe.

7.1.19 Protection of business relationshipsThe Company will rely significantly on good relationships with regulatory, governmental departments andnon-governmental organisations. There can be no assurance that its existing relationships will continue tobe maintained or new ones will be successfully formed and the Company could be adversely affected bychanges to such relationships or difficulties in forming new ones.

The Company has successfully maintained a good relationship with regulatory, governmental departmentsand non-governmental organisations.

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7.1.20 Lack of revenueThe Company expects to incur losses unless and until such time as the assets it acquires generate sufficientrevenues to fund their capital expenditure requirements and continuing operations. There can be noassurance that the Company will generate any revenues or achieve profitability, particularly if Shareholdersdo not approve the Acquisition.

The Company works to ensure operational efficiency is maintained and strives to achieve high performancein its business operations.

7.1.21 InfrastructureIt is likely that the Company will be required to use public infrastructure for its operations. There is a risk thatsome of the infrastructure required may not be available at the times required as much of the publicinfrastructure in sub-Saharan Africa is in a dilapidated or poor condition.

7.1.22 CompetitorsThe Company will face competition from a range of support services and logistics companies, some ofwhich are large and well-established. The competitors may be larger and/or have greater capital resources.There is no assurance that the Company will be able to compete successfully in such a marketplace in thefuture. In addition, the Company cannot predict the pricing or promotional activities of its competitors ortheir effect on its ability to market and sell its services. In order to ensure that its services remain competitive,the Company may be required to reduce its prices as a result of price reductions by its competitors. Thiscould adversely affect the Company’s results.

The Company has strategically built its capacity and reputation across various jurisdictions to mitigate againstcompetition risk.

7.1.23 Expansion through acquisitions entails certain risksPart of the Company’s strategy may involve expanding its business through acquisitions of other businessesor establishing new businesses. Acquisitions will require the integration of new operations into the Company’sbusiness. The Company’s ability to realise the expected benefits from future acquisitions will depend, inlarge part, upon its ability to integrate new operations with existing operations in a timely and effective mannerand to manage an increasingly large business. It will also depend upon the Company’s ability to recruitadditional management as it cannot be assured that management of acquired businesses will continue towork for the Company’s or that any of its recruiting efforts will succeed.

In addition, the Company’s acquisition strategy will involve numerous risks, including the potential inabilityto identify appropriate acquisition opportunities, possible failures of acquisitions to be profitable or to generateanticipated cash flows, the entry into markets and geographic areas where the Company has limited or noexperience, diversion of management’s time and resources from core operations and potential difficulties inintegrating operations and systems with those of acquired companies.

Management intends to carefully examine any new proposed businesses before integrating them withexisting businesses. Management conducts due diligence in respect of any potential acquisition targets.

7.1.24 Implementation and reliance on IT systemsEach of the areas of the Company’s business rely on technology to communicate with clients and to carryout all areas of its operations. To improve efficiencies and effectiveness, the Company intends to implementnew IT systems, particularly in respect of inventory and warehousing. If serious breaches, errors orbreakdowns in the Company’s information technology or telecommunications systems, or if its operationsare subject to power or other failures which are prolonged or occur on a regular basis, then the Companycould incur substantial costs in identifying and fixing the systems (including increased labour costs andmaintenance fees), could lose the goodwill of its clients and could also materially breach contracts it haswith its clients and thereby lose revenues, face client claims and suffer reputational harm.

As part of operational risk management policy, a comprehensive system of internal controls is maintainedand systems and procedures to monitor transactions are established.

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7.1.25 Risks associated with operating in Sub-Saharan AfricaChanges in government, monetary policies, taxation, exchange control and other laws can have a significantimpact on the Company’s assets, operations and ultimately the financial performance of the Company andits securities.

Several countries in sub-Saharan Africa are liable to experience periods of political instability, and there canbe no guarantees as to the level of future political stability. The Company intends to acquire interests in suchsub-Saharan African regions, and so changes to government policies and applicable laws could adverselyaffect the operations and/or financial condition of any such interests acquired by the Company.

The Company operates in sub-Saharan Africa. There are various risks associated with the sub-SaharanAfrican region including disease, political instability and weather related risks. HIV/AIDS and Malaria areprevalent in this region and the region is susceptible to other epidemics and public health emergencieswhich may pose serious risks. As a result, the Company may incur loss of man hours and employees.

Education and skill levels are also limited in this region and may affect the Company’s ability to hire adequatelyskilled employees.

The Company monitors the monetary policies, taxation, exchange controls and other laws of thesub-Saharan countries in which it has operations and tries to ensure that the Company is protected fromany adverse implications of such changes.

7.1.26 Laws and regulationsThe Company’s plans and operations are subject to a variety of national, provincial, state, foreign and locallaws and regulations including health and safety. Because such laws and regulations are outside theCompany’s control, the Company cannot predict the impact of changes in such laws or regulations in thefuture. The adoption of new or different laws and regulations could adversely affect the Company’s plans oroperations.

Legal systems in certain countries in which the Company operates are developing and have undergonesignificant changes in recent years. The interpretation of, and procedural safeguards relating to, these legaland regulatory systems are still developing, creating the risk of inconsistency in their application and thereforeuncertainty concerning actions that are necessary for compliance with those systems. The Company maynot be able to obtain the legal remedies provided for under these laws and regulations in a reasonably timelymanner and may not be able to enforce its rights (which therefore may not be adequately protected). A lackof legal certainty in operating the Company’s and Company’s business, or its inability to obtain predictablelegal remedies in a timely manner or at all, may have a material adverse effect on the Company’s and theCompany’s business, results of operations and financial condition.

The Company has set up management structures and policies which permit analysis and assessment oflegal risks and plans for possible losses in order to minimize any adverse effects on financial performance.The Company engage specialist external counsel where necessary to provide independent legal advice.

7.1.27 Fraud, bribery and corruptionFraud, bribery and corruption are more common in some jurisdictions than in others. The Company carrieson business in certain jurisdictions which have been allocated low scores on Transparency International’s“Corruption Perceptions Index”. Doing business in international developing markets brings with it inherentrisks associated with enforcement of obligations, fraud, bribery and corruption. In addition, the oil and gasindustries have historically been shown to be vulnerable to corrupt or unethical practices.

The Company uses its best efforts to prevent the occurrence of fraud, bribery and corruption, but it maynot be possible for the Company to detect or prevent every instance of fraud, bribery and corruption inevery jurisdiction in which its employees, agents, sub-contractors or joint venture partners are located. TheCompany may therefore be subject to civil and criminal penalties and to reputational damage. Participationin corrupt practices, including the bribery of foreign public officials, by the Company, its subsidiaries or otherpredecessors in interest, whether directly or indirectly (through agents or other representatives or otherwise)may also have serious adverse consequences on the rights and interests of the Company.

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Instances of fraud, bribery and corruption, and violations of laws and regulations in the jurisdictions in whichthe Company operates, could have a material adverse effect on its business, prospects, financial conditionor results of operations. In addition, as a result of the Company’s strict approach to anticorruptioncompliance, there is a risk that the Company could be at a commercial disadvantage and may fail to securecontracts within jurisdictions that have been allocated a low score on Transparency International’s “CorruptionPerceptions Index” to the benefit of other companies who may not have or comply with such anti-corruptionsafeguards.

The Company uses its best efforts to prevent the occurrence of fraud, bribery and corruption, and hasestablished a comprehensive system of internal controls is maintained and systems and procedures tomonitor transactions.

7.2 General risks7.2.1 Acceptability of Ordinary Shares as considerationAlthough the Company expects to issue Ordinary Shares to satisfy all or part of any consideration payableon future acquisitions or investments, vendors of suitable assets or businesses may not be prepared toaccept as consideration, shares traded on AIM or the NSE or may not be prepared to accept OrdinaryShares at the quoted market price. In such circumstances the Company will consider alternative approaches.

7.2.2 Future fundraisingsWhilst the Directors have no current plans for raising additional capital and are of the opinion that the workingcapital available to the Company is sufficient for its present requirements, it is possible that the Companywill need to raise extra capital either to complete an investment or acquisition or to fund its working capitalrequirements following said investment or acquisition. It is difficult for the Directors to predict accurately thetiming and amount of these capital requirements. No assurance can be given that any such additionalfinancing will be available or that, if available, it will be available on terms favourable to the Company orShareholders.

The Company manage its financing requirements on a prudent basis so as to ensure that these risks areminimised and mitigated.

7.2.3 DividendsThere can be no assurance as to the level of future dividends, if any. The declaration, payment and amountsof any future dividends of the Company are subject to the discretion of the Directors, and will depend, amongother things, upon the Company’s earnings, financial position, cash requirements and availability of profitsas well as the provisions of relevant laws or generally accepted accounting policies.

It is the Company’s intention to issue dividends following an approval from the Board of Directors and uponavailability of profits in accordance with prudent financial practices.

7.2.4 General economic conditionsChanges in the general economic climate in which the Company operates may adversely affect the financialperformance of the Company. Factors that may contribute to that general economic climate include thelevel of interest rates, exchange rates and the rate of inflation.

The Company constantly monitors the economic conditions and formulates policies to protect the businessfrom any potential negative effects of changing economic climate.

7.2.5 Forward-looking statementsThis document contains certain forward-looking statements with respect to the proposed operations andbusiness of the Company and certain plans and objectives of the Company with respect thereto. By theirnature, forward-looking statements involve risk and uncertainty, because they relate to events and dependon circumstances that will occur in the future and the factors described in the context of such forward-

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looking statements in this document could cause actual results and developments to differ materially fromthose expressed in or implied by such forward-looking statements.

To mitigate against strategic risks, the Board and senior management periodically carefully formulate strategicbusiness plans (reflective of good corporate governance practices), and are committed to the establishmentof appropriate and proportionate internal infrastructure for implementation of the strategic plans.

7.2.6 Exchange ratesThe Company is capitalised in pounds sterling, however it will be operating in sub-Saharan Africa and itsworking capital requirements may be denominated in currencies other than pounds sterling. As a resultfluctuations in currency exchange rates could have a material adverse effect on the financial condition,results, operations or cash flows of the Company.

The Group is exposed to foreign exchange risk arising from various currency exposures, primarily withrespect to the US Dollar and may enter into hedging transactions where appropriate to minimise effects ofpotential risks.

7.2.7 TaxationAny change in the Company’s tax status or the tax applicable to holding Ordinary Shares or in taxationlegislation or its interpretation, could affect the value of the assets held by the Company, affect the Company’sability to provide returns to Shareholders and/or alter the post-tax return of Shareholders. Statements inthis document concerning the taxation of the Company and/or its investors are based upon current law andpractice which are subject to change. An investor should consult his or her own tax adviser about the taxconsequences of an investment in the Ordinary Shares.

The Company constantly monitors tax legislation to ensure the laws are properly followed and that the Boardunderstands and plans for proposed legislation changes.

7.3 Risk Management ResponsibilityThe Group has taken measures to manage risk in line with strategy and within risk appetite. Theimplementation of a robust and transparent risk management program is necessary to enable the Group toadapt and meet these challenges in a structured way to continually align its priorities and objectives againsta background of changing risk and uncertainty. The Group’s overall risk management programme seeks tominimise potential adverse effects on foreseen and unforeseen risks on the Group’s financial performance.

Risk management is carried out under supervision and direction from the Group’s executive management.Management identifies and evaluates risks and promotes risk management initiatives with a view to:

� applying due diligence in planning and day-to-day management activities.

� promoting proactive management with the early identification and treatment of risks.

� improving the focus on the Group’s key strategic goals leading to:

o more robust basis for strategic planning as key elements of risk have been identified.

o more effective allocation of resources to key services and areas of high risk improving servicedelivery.

o improved level of accountability and responsibility.

o better informed decisions about opportunities and new initiatives/projects.

o avoidance of taking unnecessary and/or inappropriate risks.

7.4 Risk Factors Relating to this ListingThe Offer price for the Company’s shares has been determined by ADSS in consultation with the transactionadvisors and may not be indicative of prices that will prevail in the open market following this Listing.

Investors should therefore consider carefully whether investment in the Company is suitable for them, in lightof the risk factors outlined above, their personal circumstances and financial resources available to them.

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8. STATUTORY AND GENERAL INFORMATION8.1. General and Legal Information� The legal and commercial name of the Company is “Atlas Development & Support Services Limited”.

� The Company was incorporated in Guernsey under the Law on 5 December 2012 with number 55964as a non-cellular company limited by shares with the name “Africa Oilfield Logistics Limited”.

� On 5 November 2014 the shareholders of the Company resolved to change the name of the Companyto “Atlas Development & Support Services Limited”.

� The liability of the shareholders of the Company is limited to the amount paid up or to be paid up ontheir shares. The Company has an unlimited share capital of ordinary shares of no par value.

8.2. Principal ObjectsThe Company’s objects are unlimited.

8.3. Articles of IncorporationThe following are the key provisions of the Company’s Articles of Incorporation (“Articles”):

8.3.1 General Meetings(a) The first annual general meeting of the Company must be held within 18 months of

incorporation after which annual general meetings must be held at least once in eachsubsequent calendar year (with no more than 15 months elapsing between meetings). Generalmeetings can be held in Guernsey or such other place outside the United Kingdom as theBoard determine.

(b) Any general meeting is convened by at least 14 clear days’ notice, specifying the date, timeand place of the meeting and, in the case of any special business, the general nature of thebusiness to be transacted. With the consent in writing of all the members entitled to receivenotice of such meeting, a meeting may be convened by shorter or no notice. An annual generalmeeting is convened by at least 21 clear days’ notice.

(c) The quorum for a general meeting is two members present in person or by proxy.

8.3.2 Class MeetingsThe provisions of the Articles to general meetings apply mutatis mutandis to class meetings. The necessaryquorum is two members holding or representing by proxy at least one third of the issued shares of the classin question (excluding any shares of that class held as treasury shares).

(i) Votes of members(a) Subject to any rights or restrictions as to voting attached to any class of shares, at any general

meeting, on a show of hands, every member who is present in person or by proxy and entitledto vote has one vote and, in the case of a poll, every member present in person or by proxyhas one vote for every share of which he is the holder. No member is entitled to attend or voteat a general meeting either personally or by proxy if he or any person appearing to be interestedin shares held by him has been duly served with a direction notice and is in default for theprescribed period in supplying to the Company the information required thereby or, if any callsfrom him have not been paid.

(b) Unless a poll has been demanded, a declaration by the chairman that a resolution has beencarried or lost on a show of hands and an entry to that effect in the minute book is conclusiveevidence of the fact without proof of the number or proportion of the votes recorded.

(c) If a poll is properly demanded, it must be taken in such manner and at such place as thechairman may direct (including the use of ballot or voting papers or tickets) and the result of apoll is deemed to be the resolution of the meeting at which the poll was demanded.

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(d) In case of an equality of votes the chairman does not have a second or casting vote in additionto any other vote he may have.

(e) The instrument appointing a proxy must be in writing under the hand of the appointor or of hisattorney duly authorised in writing or if the appointor is a corporation under its common sealor under the hand of an officer or attorney duly authorised.

(f) The instrument appointing a proxy and the power of attorney or other authority (if any) underwhich it is signed or a notarially certified copy of that power or authority must be deposited atthe registered office of the Company or such other address nominated by the Board not lessthan 48 hours before the time for holding the meeting.

(g) Subject to the Law, a resolution in writing signed by or on behalf of the requisite majority ofmembers (including, for the avoidance of doubt, shareholders of a particular class) who, onthe date when the resolution is circulated, would be entitled to vote on the resolution if it wereproposed at a meeting, is as effective as if the same had been duly passed at a generalmeeting.

8.3.3 Directors(a) A director is not required to hold any qualification shares.

(b) The number of directors shall be not less than three, and there shall be no maximum number, unlessotherwise determined by the Company by ordinary resolution.

(c) The amount of any fees payable to Directors (in their capacity as such) shall be determined by theboard. The Directors are also entitled to be repaid all reasonable travelling, hotel and other expensesproperly incurred by them respectively in the performance of their duties. Any director holding anexecutive office or otherwise performing any special duties of special services by arrangement of theboard which in the opinion of the Directors are outside the scope of his ordinary duties as a directormay be paid such reasonable additional remuneration as the Directors may determine.

(d) The board may establish and maintain or procure the establishment and maintenance of anynoncontributory or contributory pension or superannuation funds for the benefit of, and givedonations, gratuities, pensions or other benefits to, any Director or ex-Director.

(e) The Directors may from time to time appoint one or more of their body to be the holder of anyexecutive office (including the office of executive director) on such terms as they think fit.

(f) Subject to the Law and the Articles and provided that he has disclosed to the Directors the natureand monetary value or, if such value is not quantifiable, the extent of any interest of his, a directornotwithstanding his office:

i. may be a party to, or otherwise interested in, any contract or arrangement with the Company orin which the Company is otherwise interested;

ii. may be a director or other officer of, or employed by, or a party to, any transaction or arrangementwith a shareholder of, or otherwise directly or indirectly interested in, anybody corporate promotedby the Company or in which the Company has entered into any transaction, arrangement oragreement or in which the Company is otherwise interested;

iii. may act in a professional capacity to the Company (except that of auditor) in conjunction withthe office of director on such terms as to remuneration and otherwise as the Directors may arrangeas if he were not a Director; and

iv. shall not, by reason of his office, be accountable to the Company for any benefit which he derivesfrom any such office or employment or from any such transaction or arrangement or from anyinterest in any such body corporate, and no such transaction or arrangement shall be liable to beavoided on the grounds of any such interest or benefit.

(g) Save as specifically provided in the Articles, a director may not vote in respect of any contract orarrangement in which he is materially interested otherwise than by virtue of his interests in shares ordebentures or other securities of, or otherwise in or through, the Company and/or the counterparty tothe contract or arrangement. A director will not be counted in the quorum at a meeting in relation toany resolution on which he is debarred from voting.

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(h) Subject to the Law, a director is (in the absence of some material interest other than as indicated below)entitled to vote (and will be counted in the quorum) in respect of any resolution concerning any of thefollowing matters, namely:

i. the giving of any guarantee, security or indemnity to him in respect of a debt or obligations;

ii. incurred by him at the request or for the benefit of the Company or any of its subsidiaries;

iii. the giving of any guarantee, security or indemnity to a third party in respect of a debt or obligationof the Company or any of its subsidiaries for which he himself has assumed responsibility in wholeor in part under a guarantee or indemnity or by the giving of security;

iv. the giving to him of any indemnity where all other Directors are also being offered indemnities onsubstantially the same terms;

v. the funding by the Company of his expenditure on defending proceedings or the doing by theCompany of anything to enable him to avoid incurring such expenditure where all other Directorsare being offered substantially the same arrangement;

vi. any proposal concerning an offer of shares or debentures or other securities of or by the Companyor any of its subsidiaries for subscription or purchase in which offer he is or is to be interested asa participant in the underwriting or sub-underwriting thereof;

vii. any proposal concerning the purchase and/or maintenance of any insurance policy against anyliability of his or under which he may benefit; and

viii. any proposal concerning the adoption, modification or operation of a pension fund or retirement,death or disability benefits scheme or employees’ share scheme which relates both to thedirectors and employees of the Company or any of its subsidiary undertakings which does notprovide the director any privilege or advantage not awarded to the employees to which the fundor scheme relates.

8.3.4 Borrowing powers of the BoardThe board may exercise all the powers of the Company to borrow money and to give guarantees, mortgage,hypothecate, pledge or charge all or part of its undertaking property or assets (present or future) and uncalledcapital and, subject to the provision of the Laws, to issue debentures, loan stock and other securities whetheroutright or as collateral security for any debt, liability or obligation of the Company or of any third party.

Subject to any applicable requirement of law, interest may be charged against the income of the Companyor against the capital or partly the other as the Board may from time to time determine.

Any person lending money to any Group company shall be entitled to assume that the relevant company isacting in accordance with its constitution and shall not be concerned to enquire whether such provisionshave in fact been complied with.

8.3.5 Distribution of assets on liquidationThe Company may be wound up voluntarily by a special resolution of the Shareholders in general meeting.The Company may also be wound up at any time in accordance with the provisions of the Law.

If the Company is wound up the liquidator will, as soon as is practicable, realise the assets of the Company.The liquidator will be required to apply the assets of the Company to satisfy liabilities incurred by theCompany and, after paying thereout or retaining adequate provision for all liabilities properly so payable andretaining for the costs of the winding-up, distribute proceeds of the realisation pari passu to the Shareholders,in each case upon production by holders of such evidence as the liquidator may reasonably require as totheir entitlement thereto.

The Shareholders are entitled pari passu amongst themselves, but in proportion to the numbers of sharesheld by them, to share in the proceeds of realisation. The liquidator may, with the sanction of a specialresolution of the Company, divide among the Shareholders in specie the whole or any part of the assets ofthe Company and (whether or not the assets consist of property of one kind or of properties of differentkinds) may, for that purpose, value any assets and determine how the division shall be carried out as betweenthe Shareholders or different classes of Shareholders. The liquidator may, again with the sanction of a special

51

resolution of the Company, vest the whole or any part of the assets in trustees upon such trusts for thebenefit of the Shareholders as he determines. However no Shareholder shall be compelled to accept anyassets on which there is any outstanding liability.

8.3.6 Disclosure RequirementsIf the Board determines that a holder of Ordinary Shares has not complied with the disclosure requirementscontained in the Articles, with respect to some or all of the Ordinary Shares held by such holder of OrdinaryShares, the Board shall have the right to serve a direction notice on such person which notice shall;

(a) suspend the right of such person to vote those Ordinary Shares in person or by proxy at any meetingof the Company; and

(b) where such Ordinary Shares represent at least 0.25 per cent. of the issued Ordinary Shares, (i) withhold,without any obligation to pay interest thereon, any dividend or other amount payable with respect tosuch shares; and/or (ii) prohibit the transfer of any Ordinary Shares save in certain circumstances.

Further, pursuant to the Law, if in the opinion of the resident agent of the Company, a Shareholder has failedwithout reasonable excuse to disclose beneficial ownership pursuant to a notice served by the residentagent requesting the same, or where a Shareholder has made a statement in response to such a noticewhich is false, deceptive or misleading in a material way, the resident agent shall give notice of this to theCompany, the Company may then place a restriction as it thinks fit, on rights attaching to the Shareholders’interest in the Company, including (a) any right to transfer the interest, (b) any voting rights, (c) any right tofurther shares in respect of the shares already held by him and (d) any right to payment due to thatShareholders’ interest in the Company, whether in respect of capital or otherwise, or may cancel theShareholder’s interest in the Company.

8.3.7 Rights attaching to sharesSubject to the terms and rights attaching to shares already in issue and the Articles, any new shares shallbe of such class and amount and have such preference or priority as regards dividends or in the distributionof assets or as to voting or otherwise over any other shares of any class whether then issued or not or besubject to such stipulations deferring them to any other shares with regard to dividends or in the distributionof the assets as the Board may determine.

(i) Voting of class rights and changes of capital(a) All or any of the rights for the time being attached to any class of shares may, subject to the

Law, be altered or abrogated in such manner (if any), as may be provided by such rights or inthe absence of such provision, either with the consent in writing of the holders of not less thanthree fourths in number of the issued shares of that class or with the consent of a specialresolution passed at a separate general meeting of the holders of shares of that class wherethe quorum at such meeting shall be two persons holding or representing by proxy at leastone third of the issued shares of the class in question.

(b) The Company may by ordinary resolution, consolidate and divide all or any of its shares intoshares of a larger amount, cancel any shares not taken or agreed to be taken by any person,sub-divide its shares into shares of a smaller amount, convert all or any of its fully paid sharesthe nominal amount of which is expressed in a particular currency into fully paid shares of anominal amount of a different currency, the conversion being effected at the rate of exchange(calculated to not less than three significant figures) current on the date of the resolution or onsuch other date specified by the resolution, convert the whole or any particular class of itsshares into redeemable shares, or redesignate the whole or any particular class of its sharesinto shares of another class.

(c) Subject to the Law, the Company may purchase its own shares and hold such shares astreasury shares.

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(ii) Pre-emption Rights on Issue of SharesThe Articles provide that, after the first annual general meeting the Directors authority to issue,grant rights to subscribe for or convert any equity securities shall be determined by ordinaryresolution of the Company, and unless otherwise approved by special resolution, the Companyshall not issue or grant equity securities wholly for cash (or sell Ordinary Shares held as treasuryshares) on any terms unless:

(a) the Directors have made an offer by way of written notice to each person who holds OrdinaryShares of the same class to issue (or sell) to him on the same or more favourable terms insuch proportion of those equity securities that is as nearly as practicable equal to the proportionthat the relevant person’s existing holding of Ordinary Shares on a fixed record date; and

(b) the period during which any offer referred to in sub paragraph (a) above may be accepted hasexpired or the Company has received notice of the acceptance or refusal of every offer made.These preemption rights do not apply to: a particular issue (or sale) of equity securities if theyare to be wholly or partly paid up (or paid for) otherwise than in cash; or to the issue of equitysecurities granted in accordance with the Company’s employees’ share plan or the issue ofshares pursuant to the exercise or conversion of any equity securities, any rights attaching toequity securities, or any rights to acquire shares which in each case were validly issued orgranted; or the issue of shares pursuant to any script dividend scheme implemented by theCompany in accordance with the Articles, or any bonus issue of shares.

8.3.8 Share Capital History� Between incorporation of the Company and 25 February 2013, 22 million Ordinary Shares were issued

for cash at a price of 0.1p per Ordinary Share.

� Between 9 May 2013 and 6 June 2013, 115,621,596 Ordinary Shares were issued for cash at a priceof 2.0 pence per Ordinary Share.

� On 25 June 2013, 85,172,415 Ordinary Shares were issued for cash at a price of 5.0 pence perOrdinary Share.

� On 9 August 2013, the Company issued and allotted 32,979,355 Ordinary Shares at a price of8.0 pence per Ordinary Share, as consideration for the acquisition of a 49 per cent. interest in Ardan.

� On 20 December 2013, 60 million Ordinary Shares were issued for cash at a price of 7.5 pence perOrdinary Share.

� On 15 August 2014, 77.8 million Ordinary Shares were issued for cash at a price of 9.0 pence perOrdinary Share.

� On 23 October 2014, the Company issued 350,000 shares in part payment for services rendered byan advisor.

� On 11 December 2014, the Company issued 39,139,827 shares for cash at a price of 8.13 pence perOrdinary Share to Kenyan investors through a private placement.

� The issued share capital of the Company at the date of publication of this document comprises433,063,193 Ordinary Shares.

There have been no debentures issued or proposed or intended to be issued within the two years precedingthe date of this listing statement.

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8.4. Other Important Information8.4.1 The Company’s Subsidiaries

Country ofCompany Name Incorporation % of interest Principal activity

Ardan Risk Holdings Limited Mauritius 100% Intermediateholding company

Ardan Risk Trading Limited Mauritius 100%* Trading companyArdan Servicos Logisticos, Lda Mozambique 100%* Dormant companyArdan Servicos Medicos, Lda Mozambique 100%* Dormant companyArdan Logistics Kenya Limited Kenya 100%* Trading companyArdan (Civil Engineering) Limited Kenya 100%* Trading companyArdan (Facilities Management) Limited Kenya 100%* Trading companyArdan (Medical Services) Limited Kenya 100%* Trading companyArdan (Risk Management) Limited Kenya 100%* Trading companyArdan (Workforce Accommodation) Limited Kenya 100%* Trading company

*Held indirectly

8.4.2 Material Contractsi. Letter of Engagement (Appointing Kenyan Nominated Advisor)On 8 August 2014, the Company appointed Burbidge Capital as its Kenyan Nominated Advisor to assistthe Company on its proposed private placement and Cross listing on the Growth Enterprises MarketSegment of the Nairobi Securities Exchange. In consideration for the provision of the services by BurbidgeCapital, the Company has agreed to pay to Burbidge Capital a monthly retainer fee of US$3,000, a fixedcorporate finance fee of US$50,000 and a commission on funds placed in the private placement as follows:for funds placed up to US$4 Million, a commission of 5 per cent.; and for funds placed above US$4 Million,a commission of 3.5 per cent..

ii. Lock-in Agreements (2013)On 19 June 2013, the Company entered into lock-in agreements with each of Mr Mann, Mr Burns, Mr Grovesand Mr Edmonds (“2013 Locked-in Shareholders”) pursuant to which each of the 2013 Locked-inShareholders agreed (subject to certain limitations discussed below) not to dispose of any Ordinary Shares,and to procure that no persons associated with the 2013 Locked-in Shareholder who are the absolutebeneficial and registered owners of Ordinary Shares will dispose of any Ordinary Shares for a period of12 months from the date of Original Admission.

iii. Lock-in Agreements (2014)On 25 September 2014, the Company entered into lock-in agreements with each of Mr. Esprey, Mr. Groves,Mr. Lobel, Mr. Monro and Mr. Mann (“2014 Locked-in Shareholders”) pursuant to which each of the 2014Locked-in Shareholders agreed (subject to certain limitations discussed below) not to dispose of any OrdinaryShares, and to procure that no persons associated with the 2014 Locked-in Shareholder who are theabsolute beneficial and registered owners of Ordinary Shares will dispose of any Ordinary Shares for a periodof 12 months from the date of Admission.

Certain disposals are permitted, including:

� any disposal pursuant to acceptance of a takeover offer, which is open to all the Shareholders, madeto acquire the whole or a part of the issued share capital of the Company (other than any Sharesalready held by the offeror or persons acting in concert with the offeror) whether by means of acontractual takeover bid or a scheme of arrangement effected under Law (a “Takeover Offer”);

� the execution of an irrevocable commitment to accept a Takeover Offer;

� any disposal pursuant to an intervening court order; or

� any disposal to or by such 2014 Locked-in Shareholder’s personal representatives upon death,pursuant to will or intestacy.

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iv. Administrative and support services agreementOn 19 June 2013 the Company entered into an agreement with African Management Services Limited(“AMSL”) pursuant to which AMSL agreed to provide administrative and support services to the Companyon an ad hoc basis.

Such services include, but are not limited to the provision of legal, financial reporting and accounting services.In consideration for the provision of the services by AMSL, the Company has agreed to pay AMSL an annualretainer fee US$25,000 (payable quarterly in advance) plus such other fees as may be agreed between theCompany and AMSL for additional services provided by AMSL at the request of the Company.

Mr Groves is also a director of AMSL and accordingly this agreement has been entered into at an arm’slength basis.

v. Acquisition Agreement and Exclusivity AgreementOn 5 August 2013, the Company entered into an agreement to acquire a 49 per cent. interest in Ardan,pursuant to which consideration of US$4 million was satisfied by the issue and allotment of 32,979,355Ordinary Shares at a price of 8.0 pence per share (issued on 9 August 2013). In addition to the Acquisition,the Company was granted exclusivity for a period of 180 days with a view to entering into an agreement toacquire the remaining 51 per cent. interest in Ardan. The transaction represented the maiden transactionfor the Company following the Original Admission.

vi. Framework and Option AgreementOn 28 March 2014, the Framework and Option Agreement was entered into to provide a framework underwhich the restructuring of Ardan could be carried out and to provide a mechanism whereby the Acquisitioncould be effected. On 22 October 2014 the shareholders of the Company approved the Acquisition andaccordingly the Acquisition was thereafter completed.

Under the terms of the Framework and Option Agreement, Ardan and ALK (and their owners) undertook totake various steps, in consultation with the Company and with the benefit of advice from the Company, torestructure Ardan and to address related matters, including:

� renegotiation of certain existing contracts of Ardan;

� novation of certain existing contracts to the ALK Group;

� ensuring that all new contracts, all pitches, tenders and similar business development activities will beundertaken in the name and on behalf of the ALK Group;

� ensuring that the operation of and performance of any existing contracts novated to the ALK Groupand any new contracts, shall be sub-contracted to Ardan on and subject to the terms set out in theFramework and Option Agreement; and

� at such time as the Company determines, assigning all debts owed to the Company (or its whollyowned subsidiary, Ardan Risk Holdings Limited) by Ardan to the ALK Group.

In consideration for the mutual undertakings contained in the Framework and Option Agreement, theCompany was granted the Call Option. Pursuant to the Framework and Option Agreement Ardan and ALKhave begun the process of novating client contracts and negotiating new client contracts within the ALKGroup. This process will continue, pursuant to the Framework and Option Agreement, following completionof the Acquisition, together with the assignment/reallocation of loan balances.

The Framework and Option Agreement also contains a restated lock-in, to apply for a period of 18 monthsfrom completion of the Acquisition, in respect of the shares issued as consideration pursuant to the termsof the Acquisition Agreement.

vii. Intra group financingSince AOL completed its original acquisition of a 49 per cent. interest in Ardan pursuant to the AcquisitionAgreement, it has provided the necessary working capital funding to Ardan pursuant to the agreementsdescribed below:

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Revolving US$2m Facility Name Credit Facility US$5m Revolving Facility

Amount (max.) US$2m US$5m US$6m

Date 18 July 2013 5 August 2013 5 March 2014

Borrower

Lender

Repayment

Interest

Security

Events of default

Other Provisions

*Specific purpose amended to broaden scope to financing general working capital of Ardan in addition to finance specified projects

viii. Warrant Instrument (5p – September 2014)On 15 September 2014 the Company adopted the “Warrant Instrument (5p – September 2014)”.

Under the terms of this instrument, the Company has the ability to grant 30 million warrants to subscribe fornew ordinary shares at an exercise price of 5p per new ordinary share for the purposes of “consideration onfuture transactions/staff & consultant incentivisation”. The exercise period for each warrant granted underthis instrument runs until 15 September 2019. As at the date of this document 25 million warrants havebeen granted under this instrument.

ix. Warrant Instrument (10p – September 2014)On 15 September 2014 the Company adopted the “Warrant Instrument (10p – September 2014)”.

Under the terms of this instrument, the Company has the ability to grant 25 million warrants to subscribe fornew ordinary shares at an exercise price of 10p per new ordinary share for the purposes of “considerationon future transactions/staff & consultant incentivisation”. The exercise period for each warrant granted underthis instrument runs until 15 September 2019. As at the date of this document no warrants have beengranted under this instrument.

Ardan Risk & SupportServices Limited

Ardan Risk & SupportServices Limited

Ardan Risk HoldingsLimited

The Company The Company The Company

On 30 Business Days’notice from the Companyor on the 5th anniversaryCompany



3 month LIBOR plus 2 per cent. p.a (accruingdaily)

Payable quarterly on loanoutstanding duringprevious quarter





n/a Guarantee andindemnity provided fromArdan Risk & SupportServices (K) Limited

n/a Guarantee andindemnity provided fromArdan Risk & SupportServices (K) Limited

n/a

Standard provisions Standard provisions Standard provisions

Specific purpose relatedof None facility relates toproviding to Ardan Kenyato finance specifiedprojects

Amended pursuant toamendment dated5 March 2014 –Amendment to FacilityAgreement

Specific purposeamended to broadenscope to financing generalworking capital of Ardan inaddition to related tofinancing Ardan to financespecified projects*

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8.4.3 LicensesAll material licenses, permits, approvals and consents required by the Company and its subsidiaries to carryon the business of the Company have been duly obtained and are in full force and effect.

8.4.4 Material BorrowingsOther than intra-group borrowings, the Group has no material borrowings as at the date of this ListingStatement.

8.4.5 Litigation/DisputesNeither the Company, nor the Group, is engaged in any litigation or arbitration nor so far as the Directorsare aware, is litigation or claim pending or threatened against the Company which has, has had or may havea significant effect on the Company’s financial position.

8.4.6 Interruption in the Company’s business There have been no interruptions in the Company’s business, which may have or have had during the recentpast (covering at least the previous four months) a significant effect on the Company’s financial position.

8.5. TaxationA Shareholder who is resident in Guernsey (which includes Alderney and Herm) for Guernsey tax purposes,will incur Guernsey income tax at the applicable rate on distributions paid to that Guernsey residentShareholder by the Company. The Company is responsible for the deduction of tax from distributions andthe accounting of that tax to the Director of Income Tax in Guernsey in respect of distributions paid by theCompany to such Guernsey resident Shareholder. With effect from 1 January 2013 the deemed distributionregime, which applied to a company’s undistributed income that had not previously been distributed ordeemed to be distributed, was repealed.

The Company’s distributions can be paid to a Shareholder who is not resident in Guernsey (which includesAlderney and Herm) for tax purposes without deduction of Guernsey income tax, provided such distributionsby the Company are not to be taken into account in computing the profits of any permanent establishmentin Guernsey through which such Shareholder carries on business in Guernsey.

Guernsey currently does not levy taxes upon capital inheritances, capital gains gifts, sales or turnover (unlessthe varying of investments and the turning of such investments to account is a business or part of abusiness), nor are there any estate duties (save for registration fees and ad valorem duty for a GuernseyGrant of Representation where the deceased dies leaving assets in Guernsey which require presentation ofsuch a Grant). No stamp duty is chargeable in Guernsey on the issue, transfer or redemption of shares inthe Company.

8.6. Documents for InspectionCopies of the following key documents will be available for inspection at Burbidge Capital offices up untiland for a minimum of five working days after the date of listing:

(a) This Listing Statement;

(b) The Issuer’s Articles of Incorporation;

(c) The Certificate of Incorporation;

(d) The Certificate of Change of Name

(e) Share option scheme rules

(f) The Certificate of Registration of the Company in Kenya;

(g) Board resolution approving the Dual Listing;

(h) All material contracts;

(i) Directors service contracts;

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(j) The audited annual reports for the financial years 2012/2013 and half year 2014;

(k) Copies of service agreements with managers or secretary/ies, underwriting, vendors’ and promoters’agreements entered into during the last two (2) financial years;

(l) The legal report from Anjarwalla & Khanna dated 11th December 2014;

(m) All expert reports, letters, and other documents, balance sheets, valuations and statements any partof which are included or referred to in this Listing Statement; and

(n) Written statements signed by the auditors or accountants setting out the adjustments made by them(and giving reasons) in arriving at the figures shown in the Accountants’ Report.

(o) Removal Forms.

The Listing Statement will be available on the Company’s website indefinitely following the listing.

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9. DIRECTORS’ STATEMENTWe hereby declare that to the best of our knowledge, information and belief (having taken all reasonablecare to ensure that such is the case) all information contained in this Listing Statement and the statementscontained in the reports herein are correct, and there are no other internal documents containing informationwhich could distort the interpretation of the report or affect the importance of such information.

The Board confirm that in their opinion the working capital available to the Company is sufficient for itspresent requirements and for the next 12 months following the listing and that the issued share capital ofthe Company is adequate for the purposes of the Company for the foreseeable future.

There have been no audited or interim financial statements of the Issuer that have been publishedsubsequent to those covering the financial year ended 30 June 2014. The Directors are not aware of anysignificant changes in the financial or trading position of the Issuer that has occurred since the financial yearended 30 June 2014 other than as identified in such financial statements.

Ian Mann Carl EspreyNon-Executive Chairman Chief Executive OfficerSigned: Signed:

Barry Lobel Lachlan MonroChief Financial Officer Chief Operating OfficerSigned: Signed:

Andrew Groves Jonathan WrightExecutive Director Non-Executive DirectorSigned: Signed:

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APPENDIX 1: LEGAL OPINION

OUR REF: SS/DR/CK/5091/4YOUR REF:DATE: 11th December 2014

The DirectorsAtlas Development and Support Services Limited Richmond HouseSt Julian’s AvenueSt Peter PortGuernsey GY1 1GZChannel Islands

Dear Sirs,

We have acted as the Kenyan legal advisers to Atlas Development and Support Services Limited (theCompany) in relation to the proposed listing of its shares on the Growth Enterprise Market Segment of theNairobi Securities Exchange (the Listing) upon the terms and conditions set out in the Listing Statementdated 11th December 2014 (the Listing Statement).

Save as otherwise defined in this Opinion, expressions defined in the Listing Statement shall bear the samemeanings where used in this Opinion.

This Opinion is limited to Kenyan law as applied in the Courts of Kenya and as of the date of this Opinionand to matters prevailing as of the date of this Opinion and to matters of fact prevailing as of the date of thisOpinion.

This legal opinion (this Opinion) is given in relation to the Listing.

1 Documents reviewed1.1 For the purposes of this Opinion, we have examined originals or copies certified to our satisfaction of

the following documents:

1.1.1 The draft Listing Statement;

1.1.2 A legal Opinion of Carey Olsen LLP dated 11 November 2014 (the Carey Olsen Opinion);

1.1.3 A copy of the Certificate of Compliance in relation to the Company’s registration in Kenya;

1.1.4 A resolution of the board of directors of the Company dated 7 October 2014;

1.1.5 Letters of confirmation from the company secretary of the Company’s Kenyan subsidiariesdated 24 October 2014; and

1.1.6 Such other records and documents as we have considered necessary or appropriate for thepurposes of this Opinion in respect of the Company.

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2 Assumptions 2.1 For purposes of this Opinion, we have made the following assumptions:

2.1.1 all information contained the Listing Statement and all information provided to us by theCompany, and its officers and advisers is true, accurate and up to date;

2.1.2 the authenticity and completeness of all documents submitted to us as originals or copies, thegenuineness of all signatures, the conformity to originals of all copies, and the accuracy of anytranslations;

2.1.3 all documents have been authorised, executed and delivered by the parties to thosedocuments;

2.1.4 that representations made to us by officers and agents of the Company are true in all materialrespects; and

2.1.5 the confirmations and opinions stated in the Carey Olsen Opinion are true, correct and accuratein all respects.

3 OpinionBased on and subject to the Carey Olsen Opinion, the assumptions and other provisions set out above andthe reservations set out below, we are of the opinion that:

3.1 Status of the Company

3.1.1 The company is a non-cellular company limited by shares incorporated and validly existing inthe Island of Guernsey, Channel Islands (Guernsey) as of 5 December 2012 with registerednumber 55964.

3.1.2 The Registered Office of the Company is Richmond House, St Julian’s Avenue, St Peter Port,Guernsey GY1 1GZ, Channel Islands.

3.1.3 The Company has the power and authority to list its shares on the Nairobi Securities Exchangeby way of introduction having obtained the consent of the Board of Directors.

3.1.4 The Company has, at the date hereof, a Board of Directors consisting of the followingindividuals:

Director Position

Ian Mann Non-Executive ChairmanCarl Esprey Chief Executive OfficerBarry Lobel Chief Financial OfficerLachlan Monro Chief Operating OfficerAndrew Groves Executive DirectorJonathan Wright Non-Executive Director

3.1.5 The Company Secretary of the Company is Philip Enoch

3.1.6 The Company’s authorised service process agent in Kenya is Conrad Nyukuri.

3.1.7 The Company maintains its statutory books at its registered office at 3rd Floor Apollo Center,Westlands.

3.1.8 The issued share capital of the Company is 393,573,366 shares. The Company does not havean authorised share capital.

3.1.9 The Company is duly registered in Kenya as a foreign company under Part X of the CompaniesAct (Cap 486) under certificate of registration number CF/2014/166829 dated 6 November2014.

3.1.10 The Company has the power and authority to list its shares on the Growth Enterprise MarketSegment of the Nairobi Securities Exchange having obtained the consent of the Board ofDirectors and the Nairobi Securities Exchange.

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3.2 Licences and consents

3.2.1 No authorizations, approvals, consents, licences, exemptions, filings or registrations of or withany governmental or public bodies or authorities of or in Guernsey are required in connectionwith the Listing.

3.2.2 All authorizations, approvals, consents, licences, exemptions, filings or registrations of or withany governmental or public bodies or authorities of or in Kenya required in connection with thebusiness of the Company have been obtained by the Company in proper form, and are in fullforce and effect.

3.3 Ownership of assets

3.3.1 As of the date of this Opinion, the Company has commenced only minimal operations in Kenyaand has no material assets or liabilities in Kenya or Guernsey.

3.4 Subsidiaries

3.4.1 The following companies are subsidiaries of the Company duly incorporated in Kenya:

(a) Ardan Logistics Kenya Limited;

(b) Ardan (Risk Management) Limited;

(c) Ardan (Medical Services) Limited;

(d) Ardan (Facilities Management) Limited;

(e) Ardan(Civil Engineering) Limited; and

(f) Ardan (Workforce Accommodation) Limited.

3.5 Material litigation

3.5.1 As far as the Company is aware the Company and its subsidiaries are not a party to, and havenot been threatened with, any material litigation or arbitration in Kenya.

3.5.2 A search on the date hereof of the Royal Court records available for inspection at the Greffehas confirmed that no proceedings have been taken against the Company (including noproceedings to declare the assets of any of them to be en désastre) in Guernsey.

3.6 Material contracts in Kenya

3.6.1 Other than the contracts listed in paragraph 8.4.2 of the Listing Statement, the Company hasnot entered in to any material contracts.

3.6.2 As at the date of this Opinion, the Company is not in breach of any material contractualobligations.

3.6.3 Excepting contracts with advisers engaged by the Company for the Listing, there are nocontracts with any bank, securities exchange, investment banks, brokers or any other personin respect to the Listing.

3.7 Material borrowing

3.7.1 The Company does not have any material borrowing in Kenya or Guernsey.

4 ConsentWe consent to the inclusion of our legal opinion in the Listing Statement to be issued for the Listing in theform and context in which it appears. We confirm that we have given and as at the date of issue of theListing Statement have not withdrawn our consent to its issue and the inclusion of our legal opinion herein.

5 Reservations5.1 The opinions expressed herein are subject to the following qualifications:

5.1.1 we have relied solely on the Carey Olsen Opinion in respect of all matters relating the Guernseylaw and have not pursued any further investigations in respect of the Company in Guernsey.

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5.1.2 we shall not be liable for any inaccuracies in this opinion resulting from the actions and/oromissions and/or wilful statements or representations on the part of the Company and/or anyof its officers, representatives or agents in the Documents or from the Company’s legal advisorsas to Guernsey law which may take place or which may be made in connection with thepreparation and/or rendering of this opinion;

5.1.3 any views which are expressed in respect of, or on the basis of, any law, statute, regulation orsimilar rules, are expressed in respect of the relevant law, statute, regulation or similar rules asit was in force, and on the basis of the provisions thereof, at the date of this opinion;

5.1.4 the opinions expressed herein relate only to Kenyan law as currently applied and interpretedby the Kenyan courts and are limited to questions arising under the laws of Kenya. We do notpurport to have investigated the laws of any jurisdiction outside of Kenya, nor to express anyopinion on any question arising under the laws of any other jurisdiction;

5.1.5 except as explicitly stated herein, we express no opinion on matters of fact; and

5.1.6 we do not give any opinion on the commerciality of the Listing.

6 Effective DateThis letter and the opinion given in it are governed by the laws of the Republic of Kenya and relate to thelaw of the Republic of Kenya as applied by the courts of the Republic of Kenya as at today’s date. Weexpress no opinion in this letter on the laws of any other jurisdiction.

7 Reliance7.1 This opinion is given to the directors of the Company for their own use in relation to the proposed

Listing and other than in the Listing Statement may not be disclosed in whole or in part by any personor otherwise quoted, referred to or relied upon for any other purpose. This Opinion is not intended toact as a recommendation as to whether any person should invest in the Company.

7.2 We have taken instructions solely from the Company. The issuance of this opinion shall not be takenas an implication that we owe a fiduciary duty of care or a contractual duty of care to any personwho is not our client.

Yours faithfully,

for Anjarwalla & Khanna

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APPENDIX II: INTRODUCTION TO FINANCIALSThe following audited financial statements for the Company and the relevant subsidiaries are attached:

1. Atlas Development And Support Services Limited for the years ended 30 June 2013 and 30 June 2014;

2. Ardan Risk & Support Services Limited for the years ended 31 December 2012 and 31 December2013, plus the interim audited statements for the six-months ended 30 June 2014.

As already mentioned, Atlas purchased a 49 per cent. stake in Ardan in August 2013, and exercised thecall option to acquire the remaining 51 per cent. in October 2014. As such, the financial statement for Atlasfor the year ended 30 June 2014 incorporates 49 per cent. of Ardan from August 2013 to June 2014 only.

In addition, it worth mentioning that since January 2014, Atlas implemented a restructuring of Ardan toimprove operational management and implementation, planning and reporting. This included simplifying theoperational structure into 3 separate business divisions, recruiting highly qualified divisional leadership torun the business, recapitalizing the business by way of loans from Atlas, renegotiating loss making contracts,and the implementation of new systems and controls which included the identification and elimination ofcosts inefficiencies.

The results of this restructuring are clearly evident in the turnaround performance of Ardan during the firstsix months of 2014, in which the business has transformed from losses of -US$3.7m in 2013, to profitsafter tax of +US$4.3m in the first 6 months of 2014.

Consequently, when viewing the attached financials, the following considerations should be taken intoaccount:

1. The values for Ardan, as included in Atlas’ financials for 2014 include results from Aug-Dec 2013which were prior to the restructuring of Ardan, and therefore when Ardan was still loss making; and

2. From October 2014, Atlas owns 100 per cent. of Ardan, so 100 per cent. of the profits will beconsolidated into Atlas from this date.

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APPENDIX III: REPORTING ACCOUNTANT’S REPORT

ATLAS Development and Support Services

Financial Statements and Accountants ReportPrepared by Baker Tilly Meralis Kenya

For the Period ended 30 June 2014

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13 November 2014

The Board of DirectorsAtlas Development & Support Services LimitedGuernsey GY1 1G2

1. REPORT OF THE ACCOUNTANTSIntroductionWe submit our Accountant’s report in accordance with Section 19 of the Third Schedule of the CompaniesAct (Cap. 486) and Part CC of the Third Schedule of the Capital Markets (Securities) (Growth EnterprisesMarket Segment Disclosure Requirements) Regulations, 2002 (the “Regulations”), as amended by theCapital Markets (Securities) (Public Offers, Listings and Disclosures) (Amendment) Regulations, 2012.

Responsibility of the directorsThe directors of Atlas Development & Support Services Limited (the “Company”) are responsible for thepreparation of the Listing Statement and all the information contained therein and for the financialstatements to which this Accountant’s Report relates and from which it has been prepared.

Our responsibility and procedures appliedOur responsibility is to review the financial statements of the Group prepared on the basis as detailed inthe basis of accounting policy to the financial statements for the year ended 30 June 2014 and the yearended 30 June 2013 (collectively referred to as the “Financial Information”) based on the audited financialstatements for the respective periods under the requirements of International Standard on ReviewEngagements 2400 – Engagements to Review Financial Statements (“ISRE 2400”).

The group comprises of Atlas Development & Support Services Ltd (the company) and includes itsinvestments in associate Ardan Risk & Support Services Kenya Ltd.

The objective of the engagement was to enable us to state whether, on the basis of our review procedureswhich do not provide all the evidence that would be required in an audit, if anything has come to ourattention that causes us to believe that the financial statements were not prepared, in all material respects,in accordance with International Financial Reporting Standards (IFRS).

The financial information set out in this report has been compiled in accordance with the InternationalStandard on Related Services 4410 – Engagements to Compile Financial Statements (“ISRS 4410”).

In meeting the requirements above, we:

� reviewed the audited financial statements of the Company included in the Accountant’s Report for theyear ended 30 June 2013 for compliance with International Financial Reporting Standards (IFRS) andconsistency of application of accounting policies;

� reviewed the audited financial information for period ended 30 June 2014 included in theAccountant’s Report for compliance with International Financial Reporting Standards (IFRS) andconsistency of application of accounting policies under the requirements of International Standard onReview Engagements 2410 – Review of Interim Financial Information Performed by the IndependentAuditor of the entity (“ISRE 2410”);

� made enquiries of the Group as required by ISRE 4410 of management about the operations of theGroup, its accounting principles and practices and other significant matters relevant to the FinancialInformation and have applied that knowledge in compiling the financial statements. We have alsoapplied knowledge obtained from carrying out review procedures on the financial statements.

We have reviewed the Directors’ assumptions with regards to the working capital position of the group forthe next 12 months from the date of the listing. We conducted our review in accordance with InternationalStandard on Assurance Engagements (ISAE) 3400 – The Examination of Prospective Financial Information,which are future financial forecasts of the group on which this working capital requirements are based on.The objective of this review is to enable us to obtain sufficient and appropriate evidence as to the Director’s

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opinion on working capital adequacy for the next 12 months after the listing, as stated on page 59 of thelisting statement.

The financial statements of the group companies were audited by the following independent auditors:

Entity Name Auditors

Atlas Development & Support Services Limited Baker Tilly UK LLP (UK)Ardan Risk and Support Services Kenya Limited Baker Tilly Meralis (Kenya)Ardan Risk Holdings Limited Baker Tilly (Mauritius)Ardan Risk and Support Services Limited, Ethiopia Branch Tesfaye Teferi & Co. (Ethiopia)Ardan Risk and Support Services Mauritius Limited Baker Tilly Meralis (Kenya)

The financial statements have been prepared on the basis of the accounting policies set out on pages 67-70of this Listing Statement. For all accounting periods dealt with in this report, the financial statements have,in all material respects, been prepared in accordance with International Financial Reporting Standards.Where necessary, the financial statements have been adjusted to reflect the accounting policies of theGroup as will be applied in the financial statements for the year ending 31 December 2014. Suchaccounting policy changes include the retrospective effect of adoption of new and revised InternationalFinancial Reporting Standards.

We draw your attention to Note 11 with the post-acquisition financial statements and notes for theassociate Ardan Risk & Support Services Kenya Ltd, for the period 5th August 2013 to 30 June 2014.

Review OpinionReviews carried out in accordance with ISRE 2400 and ISRE 2410 as well as a compilation under ISRS4410 are substantially less in scope than an audit conducted in accordance with International Standardson Auditing and consequently do not enable us to obtain assurance that we would become aware of allsignificant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.However, based on our review, nothing has come to our attention that causes us to believe that theaccompanying financial statements of Atlas Development & Support Services Limited and Ardan Risk &Support Services Kenya Limited for the periods ended 30 June 2014 and 30 June 2013, do not give a trueand fair view, for the purposes of the Listing Statement, in accordance with International FinancialReporting Standards (IFRS).

In respect of the adequacy of working capital, based on our review and the enquiries with the Directors,nothing has come to our attention which causes us to believe that the assumptions made by the Directorsin arriving at their assessment of the adequacy of the working capital for at least the next 12 months afterthe date of the listing are unreasonable.

We consent to the inclusion of this report in the Atlas Development & Support Services Limited ListingStatement to be issued in the form and context in which it appears.

Madhav Bhandari Reg 1213Baker Tilly MeralisCertified Public Accountants

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2. ACCOUNTING POLICIESBasis of accountingThe consolidated financial statements incorporate the financial statements of the Company and entitiescontrolled by the Company (its subsidiaries) made up to 30 June 2014. Control is achieved when theCompany has the power to govern the financial and operating policies of an investee entity so as to obtainbenefits from its activities.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated incomestatement from the effective date of acquisition or up to the effective date of disposal, as appropriate.

Associates are those entities in which the Group has significant influence, but not control, over the financialand operating policies. The consolidated financial statements include the Group’s share of the totalrecognised income and expenses of associates on an equity accounted basis, from the date thatsignificant influence commences until the date that significant influence ceases. When the Group’s shareof losses exceeds its interest in an associate, the Group’s carrying amount is reduced to nil and recognitionof further losses is discontinued except to the extent that the Group has a binding obligation to makepayments on behalf of an associate.

Intra-group transactions, balances and unrealised gains on transactions between group companies areeliminated. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent thatthere is no evidence of impairment.

On the 5th August 2013 Atlas Development and Support Services entered into a share purchase agreementwith the current shareholders of Ardan Risk and Support Services (K) Limited and Ardan Ethiopia for thepurchase of 49 per cent. of equity. On 28th March 2014 Atlas Development & Support Services Limitedentered into Framework and option agreement which involved novation of existing contracts to a newcompany Ardan Logistics Kenya Ltd and was granted a call option to acquire 100 per cent. of the newArdan Company in exchange for the 49 per cent. of Ardan Risk and Support Services (K) Ltd.

It is expected that all future revenues and contracts will be transacted through new Ardan Logistics Kenya Ltd.

Going concernThe board has detailed its considerations relating to Going Concern in note 3 of the financial statements.

The directors have, at the time of approving the financial statements, a reasonable expectation that theGroup has adequate resources to continue in operational existence for the foreseeable future. Thus theycontinue to adopt the going concern basis of accounting in preparing the financial statements.

Foreign currency translationThe presentational currency of the group is US Dollars as this reflects the groups’ planned businessactivities in the logistics sector in sub Saharan Africa and therefore the Groups financial position andfinancial performance.

Foreign currency transactions are translated into the functional currency of the entity using the exchangerates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from thesettlement of such transactions and from the translation of monetary assets and liabilities denominated inforeign currencies at period end exchange rates are recognised in the income statement. Details ofexchange rates are explained in Note 11.

Operating lossOperating loss consists of operating expenses and excludes interest income net of finance costs.

Interest incomeInterest income is accrued on an amortised cost basis, by reference to the principal outstanding and at theeffective interest rate applicable, which is the rate that exactly discounts estimated future cash receiptsthrough the expected life of the financial asset to that asset’s net carrying amount.

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TaxationThe Company is resident for taxation purposes in Guernsey and its income is subject to income tax,presently at a rate of zero per cent per annum. The income of overseas subsidiaries is subject to tax at theprevailing rate in each jurisdiction.

Financial assets

Financial assets are classified into the following specific categories: financial assets ‘at fair value throughprofit or loss’ (FVTPL), ‘held-to-maturity’ investments, available-for-sale (AFS) financial assets and ‘loansand receivables’. The classification depends upon the nature and purpose of the financial asset and isdetermined at the time of initial recognition.

Investment in subsidiaries

Subsidiaries are all entities (including special purpose entities) over which the group has the power togovern the financial and operating policies generally grouping a shareholding of more than one half of thevoting rights. The existence and effect of potential voting rights that are currently exercisable or convertibleare considered when assessing whether the group controls another entity.

The group also assesses the existence of control where it does not have more than 50 per cent. of thevoting rights but is able to govern the financial and operating policies of a subsidiary. Control may arise incircumstances where the size of the group’s voting rights relative to the size and dispersion of holdings ofother shareholders give the group the power to govern the financial and operating policies, etc.

Investment in AssociatesAssociates are entities over which the group has significant influence but not control or joint control,generally accompanying a shareholding of between 20 per cent. and 50 per cent. of the voting rights.Investments in associates are accounted for by the equity method of accounting. Under this method theinvestment is initially recognised at cost and the carrying amount is increased or decreased to recognisethe investor’s share of the profit or loss of the investee after the date of acquisition.

The group’s share of post-acquisition profit or loss is recognised in the income statement, and its share ofpost-acquisition movements in other comprehensive income is recognised in other comprehensive incomewith a corresponding adjustment to the carrying amount if the investment. When the group’s share oflosses in an associate equals or exceeds its interest n the associate, including any other unsecuredreceivables, the group does not recognise further losses, unless it has incurred legal or constructiveobligations or made payments on behalf of the associate.

The group determines at each reporting date whether there is any objective evidence that the investmentin the associate is impaired. If this is the case, the group calculates the amount of impairment as thedifference between the recoverable amount of the associate and the its carrying value and recognises theamount adjacent to ‘share of profit/(loss) of associates in the income statements.

Property, Plant and EquipmentAll items of property, plant and equipment are stated at historical cost less accumulated depreciation(see below) and impairment. Historical cost includes expenditure that is directly attributable to theacquisition. Subsequent costs are included in the asset’s carrying value when it is considered probable thatfuture economic benefits associated with the item will flow to the Group and the cost of the item can bemeasured reliably.

Depreciation is charged to the income statement on a straight-line basis over the estimated useful lives ofeach item, as follows:

� Plant and Equipment, 20 per cent.

� Motor Vehicles, 20 per cent.

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The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balancesheet date. Gains and losses on disposals are determined by comparing proceeds received with thecarrying amount of the asset immediately prior to disposal and are included in profit and loss.

Loans and receivablesLoans and other receivables are not interest bearing and are initially recognised at their fair value and aresubsequently stated at amortised cost using the effective interest method as reduced by appropriateallowances for estimated irrecoverable amounts.

Cash and cash equivalentsCash and cash equivalents includes cash in hand, deposits held at call with banks and other short-termhighly liquid investments with original maturities of three months or less which are subject to an insignificantrisk of changes in value.

Financial LiabilitiesTrade and other payables Trade and other payables are initially measured at fair value and are subsequently measured at amortisedcost, using the effective interest rate method.

ProvisionsProvisions are recognised when the Group has a legal or constructive obligation as a result of past events,it is probable that an outflow of the resources will be required to settle the obligation and the amount canbe reliably estimated.

Equity instrumentsEquity instruments issued by the Group are recorded at fair value on initial recognition, net oftransaction costs.

Dividend PolicyProposed dividends are disclosed as a separate component of equity until declared. Dividends arerecognized as liabilities in the period in which they are approved by the company’s shareholders. Nodividends have been declared by any of the entities.

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3. FINANCIAL INFORMATIONFinancial information year ended 30 June 2014

i) Consolidated income statement

Notes 2014 2013 $’000 $’000

CONTINUING OPERATIONSRevenue – –Cost of sales – – ––––––––––– –––––––––––

Gross Profit – – ––––––––––– ––––––––––– ––––––––––– –––––––––––

Operating expenses (2,521) (155) ––––––––––– –––––––––––

Operating loss (2,521) (155) ––––––––––– –––––––––––

Finance income 28 –Depreciation and Amortisation (7) –Share of results of associate 1,075 – ––––––––––– –––––––––––

Loss before taxation 6 (1,425) (155) ––––––––––– –––––––––––

Income tax expense 8 – – ––––––––––– –––––––––––

Loss for the year from continuing operations (1,425) (155) ––––––––––– –––––––––––

Loss for the year attributable to owners of the parent company (1,425) (155) ––––––––––– –––––––––––

Loss for the year attributable to non-controlling interests – –(Loss)/Earnings per ShareBasic & Diluted Loss per share from continuing operations (0.04) (0.01) ––––––––––– ––––––––––– ––––––––––– –––––––––––

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ii) Consolidated Statement of Comprehensive income

2014 2013 $’000 $’000

Total comprehensive loss for the year (1,425) (155) ––––––––––– ––––––––––– ––––––––––– –––––––––––

Total comprehensive loss attributable to owners of the parent company (1,425) (155) ––––––––––– –––––––––––

Total comprehensive loss attributable to non-controlling interests – – ––––––––––– –––––––––––

Total comprehensive loss for the period (1,425) (155) ––––––––––– ––––––––––– ––––––––––– –––––––––––

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iii) Consolidated Statement of Financial Position

Notes 2014 2013 $’000 $’000

AssetsNon-current assetsProperty, plant & equipment 10 174 –Investment in Subsidiaries 11 3 –Interest in Associate 12 5,075 –Loans and other receivables 8,545 – ––––––––––– –––––––––––

Total non-current assets 13,797 – ––––––––––– ––––––––––– ––––––––––– –––––––––––

Current assetsTrade and other receivables 13 2,369 871Cash and cash equivalents 14 3,132 9,162 ––––––––––– –––––––––––

Total current assets 5,501 10,033 ––––––––––– –––––––––––

Total assets 19,298 10,033 ––––––––––– ––––––––––– ––––––––––– –––––––––––

LiabilitiesNon-current liabilitiesLong-term borrowings – – ––––––––––– –––––––––––

Total non-current liabilities – – ––––––––––– ––––––––––– ––––––––––– –––––––––––

Current liabilitiesShort-term borrowings (115) (28)Trade and other payables (262) (508) ––––––––––– –––––––––––

Total current liabilities 15 (377) (536) ––––––––––– –––––––––––

Total liabilities (377) (536) ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net assets 18,921 9,497 ––––––––––– ––––––––––– ––––––––––– –––––––––––

EquityIssued capital 16 20,508 9,652Foreign Exchange Reserve (7) –Retained earnings 17 (1,580) (155) ––––––––––– –––––––––––

Total equity attributable to the equity holders of the parent company 18,921 9,497 ––––––––––– –––––––––––

Non-controlling interests – – ––––––––––– –––––––––––

Total equity 18,921 9,497 ––––––––––– ––––––––––– ––––––––––– –––––––––––

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iv) Pro-forma Balance Sheet Following Private Placement

Below is a pro-forma balance sheet reflecting the proceeds of the private placement that was completedprior to the listing by introduction, raising US$ 5,001,200 (Kshs 450,108,011 at an average exchange rateof Kshs 90/US$).

Receipt of Post money Notes Pre money money 2014 $’000 $’000 $’000

AssetsNon-current assetsProperty, plant & equipment 9 174 – 174 Investment in Subsidiaries 10 3 – 3 Interest in Associate 11 5,075 – 5,075 Loans and other receivables 8,545 – 8,545 ––––––––––– ––––––––––– –––––––––––

Total non-current assets 13,797 – 13,797 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Current assetsTrade and other receivables 12 2,369 – 2,369 Cash and cash equivalents 13 3,132 5,001 8,133 ––––––––––– ––––––––––– –––––––––––

Total current assets 5,501 – 10,502 ––––––––––– ––––––––––– –––––––––––

Total assets 19,298 – 24,299 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

LiabilitiesNon-current liabilitiesLong-term borrowings – – – ––––––––––– ––––––––––– –––––––––––

Total non-current liabilities – – – ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Current liabilitiesShort-term borrowings (115) – (115)Trade and other payables (262) – (262) ––––––––––– ––––––––––– –––––––––––

Total current liabilities 14 (377) – (377) ––––––––––– ––––––––––– –––––––––––

Total liabilities (377) – (377) ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net assets 18,921 – 23,922 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

EquityIssued capital 15 20,508 – 20,508 Share premium – 5,001 5,001 Foreign Exchange Reserve (7) – (7)Retained earnings 16 (1,580) – (1,580) ––––––––––– ––––––––––– –––––––––––

Total equity attributable to the equity holders of theparent company 18,921 – 23,922 ––––––––––– ––––––––––– –––––––––––

Non-controlling interests – – – ––––––––––– ––––––––––– –––––––––––

Total equity 18,921 – 23,922 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

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v) Consolidated Statement of Changes in Equity

Total attributable Foreign to equity Share Retained Exchange holders of capital earnings Reserve the parent $’000 $’000 $’000 $’000

Balance at 5th December 2012 – – – – ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Loss for the period – (155) – (155) ––––––––––– ––––––––––– ––––––––––– –––––––––––

Total comprehensive income for the period – (155) – (155) ––––––––––– ––––––––––– ––––––––––– –––––––––––

Transactions with ownersShare issues – cash received 10,108 – – 10,108Share issue costs (456) – – (456)Total transactions with owners 9,652 – – 9,652 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Balance at 1st July 2013 9,652 (155) – 9,497 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Loss for the period – (1,425) – (1,425)Total comprehensive income for the period – (1,425) – (1,425)Exchange translation differences on foreign operations – – (7) (7)Transactions with ownersShare issues – cash received 11,392 – – 11,392Share issue costs (536) – – (536)Total transactions with owners 10,856 – – 10,856 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Balance at 30th June 2014 20,508 (1,580) (7) 18,921 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

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vi) Consolidated Cash Flow Statement

2014 2013 $’000 $’000

Cash flows from operating activitiesLoss before tax (1,425) (155)Working Capital Adjustments:– Depreciation of property, plant and equipment 7 –– Share of Associates profit (1,075) –– Net interest income (28) –

Operating cash flow before movements in working capital (2,521) (155)Working capital adjustments:– Increase in receivables (1,498) (871)– (Decrease)/Increase in payables (159) 536

Cash used in operations (4,178) (490)Interest received 28 – ––––––––––– –––––––––––

Net cash used in operating activities (4,150) (490) ––––––––––– ––––––––––– ––––––––––– –––––––––––

Cash flows from investing activitiesPurchase of property, plant and equipment (181) –Purchase of subsidiary, net of cash received (3) –Increase in loans to associate (8,545) – ––––––––––– –––––––––––

Net cash used in investing activities (8,729) – ––––––––––– ––––––––––– ––––––––––– –––––––––––

Cash flows from financing activitiesProceeds from issue of share capital 7,392 10,108Share issue costs (536) (456) ––––––––––– –––––––––––

Net cash flow from financing activities 6,856 9,652 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net (decrease)/increase in cash and cash equivalents (6,023) 9,162Cash and cash equivalents at start of the period 9,162 –Effect of foreign exchange rate changes (7) – ––––––––––– –––––––––––

Cash and cash equivalents at end of the period 3,132 9,162 ––––––––––– ––––––––––– ––––––––––– –––––––––––

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NOTES TO THE FINANCIAL STATEMENTS

1. General informationAtlas Development & Support Services, formerly named Africa Oilfield Logistics Limited is incorporated anddomiciled in Guernsey.

The presentational currency of the Group is US Dollars as this reflects the Group’s planned businessactivities in the logistics sector in sub-Saharan Africa and therefore the Group’s financial position andfinancial performance.

The financial statements have been prepared in accordance with International Financial ReportingStandards (“IFRS”) as adopted by the European Union.

A number of new standards and amendments to standards and interpretations are effective for annualperiods beginning on or after 1 January 2014, and have not been applied in preparing these consolidatedfinancial statements. None of these new standards and amendments are expected to have a significanteffect on the consolidated financial statements of the Group.

The Group has applied the amendments to lAS 1 Presentation of Items of Other Comprehensive Income.Under the amendments to lAS 1, the ‘statement of comprehensive income’ requires separately analysis ofitems that will not be subsequently reclassified to profit or loss and hose that will be subsequentlyreclassified, including the related income tax effects. These changes have been retrospectively applied.Other than the above mentioned presentation changes, the application of the amendments to IAS 1 do notresult in any impact on profit or loss, comprehensive income and total comprehensive income.

The Group has applied the amendments to IFRS 7 Disclosures offsetting financial assets and liabilities –Transfers of financial assets in the current year. The amendments improve the disclosure requirements fortransactions involving the transfer of financial assets. As the group did not transfer any financial assets thatwere not recognised, this had no material impact on the financial statements.

International Financial Reporting Standard 10 (IFRS 10) on ‘Consolidated Financial Statements’ builds onexisting principles by identifying the concept of control as the determining factor in whether an entity shouldbe included within the consolidated financial statements of the parent group. The standard providesadditional guidance to assist in the determination of control where this is difficult to assess. The adoptionof IFRS 10 would not have any material impact on the financial statements.

International Financial Reporting Standard 12 (IFRS 12) on ‘Disclosures of Interests in Other Entities’enhances the disclosure requirements about an entity’s interests in subsidiaries, joint arrangements,associates and unconsolidated ‘structured entities’.

International Financial Reporting Standard 13 (IFRS 13) on ‘Fair Value Measurement’ – The standard aimsto improve consistency and reduce complexity by providing a more precise definition and a single sourceof measurement of fair valuation of certain assets and liabilities and the related disclosure requirements.Adoption of IFRS 13 would not have material impact on the financial statements.

At the date of authorisation of these financial statements, the following Standards and Interpretationsrelevant to the Group’s operations that have not been applied in these financial statements were in issuebut not yet effective:

IFRS 9 Financial Instruments: Classification (effective for annual periods beginning on or after1 January 2018)

IFRS 10 Consolidated Financial Statements (effective for annual periods beginning on or after1 January 2014)

IFRS 11 Joint Arrangements (effective for annual periods beginning on or after 1 January 2014)

IFRS 12 Disclosure of Interests in Other Entities (effective for annual periods beginning on or after1 January 2014)

IFRS 14 Regulatory deferral accounts (effective for annual periods beginning on or after 1 January 2016)

77

IFRS 15 Revenue from contracts with customers (effective for annual periods beginning on or after1 January 2017)

IAS 16 Amendments bringing bearer plants into the scope of IAS 16 (effective for annual periodsbeginning on or after 1 January 2016)

IAS 27 Separate Financial Statements (as amended 2011) (effective for annual periods beginning on orafter 1 January 2014)

IAS 28 Investments in Associates and Joint Ventures (as amended 2011) (effective for annual periodsbeginning on or after 1 January 2014)

IAS 32 Financial Instruments: Presentation – Amendment; Offsetting Financial Assets and FinancialLiabilities (effective for annual periods beginning on or after 1 January 2014).

IAS 41 Amendments bringing bearer plants into the scope of IAS 16 (effective for annual periodsbeginning on or after 1 January 2016)

IFRIC 21 Levies (effective for annual periods beginning on or after 1 January 2014)

September 2014 Annual Improvements to IFRSs (Effective for annual periods beginning on or after1 January 2016)

The Directors do not anticipate that the adoption of these Standards and Interpretations will have a materialimpact on the Group’s financial statements in the period of initial application.

2. Financial risk factorsThe Group’s principal financial instruments comprise cash, loans and receivables and short-term deposits.Together with the issue of equity share capital, the main purpose of these is to finance the Group’soperations and expansion. The Group has other financial instruments such as trade and other receivablesand trade payables.

The Group have not entered into any derivative or other hedging instruments.

The main risks arising from the Group’s financial instruments are credit risk, liquidity risk and market risk(including interest rate risk and currency risk). The Board reviews and agrees policies for managing each ofthese risks and these are summarised below. The interest receivable relates to interest earned onbank deposits.

Credit riskCredit risk arises from financial assets, cash and cash equivalents, and deposits with banks and financialinstitutions, as well as outstanding receivables. At the period end the Group’s principal deposits were heldwith banks with a high credit rating. Receivables are regularly monitored and assessed for recoverability.

The fair value of financial assets and liabilities is not materially different to the carrying values presented.

Maximum exposure to credit risk is as follows:

2014 2013 $’000 $’000

Trade and other receivables 2,369 871Loans to associate 8,545 –Cash and cash equivalents 3,132 9,162 ––––––––––– –––––––––––

Total 14,046 10,033 ––––––––––– ––––––––––– ––––––––––– –––––––––––

No aged analysis of financial assets is presented as no financial assets are past due at the reporting date.

78

Liquidity riskThe Group’s policy throughout the period has been to ensure that it has adequate liquidity by carefulmanagement of its working capital. At 30 June 2014 the Group held cash deposits of $3.1m(2013: $9.2m).

Market riskThe significant market risk exposures to which the Group is exposed are currency risk, and interest raterisk. These are discussed further below:

Interest rate risk

The Group finances operations through the use of cash deposits at variable rates of interest for a varietyof short term periods, depending on cash requirements. The rates are reviewed regularly and the best rateobtained in the context of the Group’s needs. The weighted average interest rate on deposits was0.1 per cent.

The exposure of the financial assets to interest rate risk is as follows:

2014 2013 $’000 $’000

Financial assets at floating rates – Cash and cash equivalents 3,132 9,162

Currency risk

The Group holds cash balances and has transactions denominated in currencies other than the reportingcurrency and which therefore are subject to fluctuations in exchange rates. These risks are monitored bythe board on a regular basis.

The Group does not hedge against the effects of exchange rates.

The exposure of the Group’s financial assets and liabilities to currency risk is as follows:

Sterling USD Total $’000 $’000 $’000

Cash and cash equivalents 2,772 360 3,132Trade and other receivables 138 2,231 2,369 ––––––––––– ––––––––––– –––––––––––

Total financial assets at 30 June 2014 2,910 2,591 5,501 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Trade payables (251) (11) (262)Other payables (115) – (115) ––––––––––– ––––––––––– –––––––––––

Total financial liabilities at 30 June 2014 (366) (11) (377) ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Fair valuesThe Directors have reviewed the financial statements and have concluded that there is no significantdifference between the carrying values and the fair values of the financial assets and liabilities of the Groupas at 30 June 2014.

Capital risk managementThe Group assess capital requirements regularly. The capital structure of the Group comprises its net debt(the borrowings after deducting cash and bank balances) and equity of the Group as shown in the balancesheet. The requirement for capital is satisfied by the issue of shares.

The Group’s objectives when managing capital is to safeguard the Group’s ability to continue as a goingconcern in order to provide returns for shareholders and benefits for other stakeholders. The Group places

79

funds which are not required in the short term on deposit at the best interest rates it is able to secure fromits bankers.

The Group is under no obligation to meet any externally imposed capital requirements.

Sensitivity analysisFinancial instruments affected by market risk include cash and cash equivalents, trade and otherreceivables and payables. The following analysis, required by IFRS 7 Financial Instruments: Disclosures, isintended to illustrate the sensitivity of the Group’s financial instruments (at period end) to changes in marketvariables, being exchange rates and interest rates.

Income Statement Equity $’000 $’000

+5% US$ Sterling 127 127-5% US$ Sterling (127) (127)

The following assumptions were made in calculating the sensitivity analysis:

� all income statement sensitivities also impact equity

� translation of foreign subsidiaries and operations into the Group’s presentation currency have beenexcluded from this sensitivity.

Interest Rates

The following table details the Group and Company’s exposure to interest rate changes, all of which affectprofit and loss only with a corresponding effect on accumulated losses. The sensitivity has been preparedassuming the liability outstanding at the balance sheet date was outstanding for the whole year. In all casespresented, a positive number in profit and loss represents an increase in interest income I decrease infinance expense. The sensitivity is presented assuming interest rates increase by either 20bp or 50bp.

Income Statement Equity $’000 $’000

+20 bp increase in interest rates 6 6+50 bp increase in interest rates 15 15-20 bp increase in interest rates (6) (6)-50 bp increase in interest rates (15) (15)

The above sensitivities are calculated with reference to a single moment in time and will change due to anumber of factors including:

� fluctuating trade receivable and trade payable balances

� fluctuating cash balances

� changes in currency mix

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3. Critical accounting estimates and judgmentsThe preparation of financial statements in conformity with IFRS as adopted in the EU requires the use ofcertain critical accounting estimates. It also requires management to exercise its judgement in the processof applying the Group’s accounting policies. The estimates and assumptions that have a significant risk ofcausing a material adjustment to the carrying amounts of assets and liabilities within the next financialperiod are discussed below

Going concernThe board has prepared forecasts for the Group covering the period of 12 months from the date ofapproval of these financial statements.

The directors believe that, the Group is well placed to manage its business risks successfully despite thecurrent uncertain economic outlook. The directors have a reasonable expectation that the Group hasadequate resources to continue in operational existence for the foreseeable future. Thus they continue toadopt the going concern basis of accounting in preparing the annual financial statements.

4. Segment reportingAs set out in the operating review, the directors consider that the Group is an investment company andoperates in one geographical segment, Africa.

5. Loss for the periodOperating expenses include:

2014 2013 $’000 $’000

Foreign exchange (gains)/losses (406) 84Consultancy fees 446Staff Costs (see note 7) 315 4

Amounts payable to Baker Tilly UK Audit LLP and its associated entities in respect of services areas follows:

2014 2013 $’000 $’000

Audit services – statutory audit of the company’s financial statements 59 31Corporate transactions services 95 38

6. Staff costsThe average monthly number of employees (including executive directors) employed by the Group duringthe period was five (2013: 2)

The aggregate remuneration comprised:

2014 2013 $’000 $’000

Directors Fees 314.9 4.2 ––––––––––– –––––––––––

Total Staff Costs 314.9 4.2 ––––––––––– ––––––––––– ––––––––––– –––––––––––

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The remuneration of the Directors, who are the key management personnel of the Group are set out below:

2014 2013 $’000 $’000

P H Edmonds 78.30 1.00A S Groves 78.30 1.00A R Burns 78.30 1.00J W Wright 40.00 0.60I H Mann 40.00 0.60 ––––––––––– –––––––––––

Total Directors Fees 314.90 4.20 ––––––––––– ––––––––––– ––––––––––– –––––––––––

No contributions were made to pension schemes for any of the directors or employees (2013: nil).

7. Income Tax ExpenseThe Company is resident for taxation purposes in Guernsey and its income is subject to Guernsey incometax, presently at a rate of zero.

2014 2013 $m $m

Loss before tax (1.4) (0.2)Loss before tax (0.4) (0.1)Tax (credit)/charge reported for continuing operations(**) – – ––––––––––– –––––––––––

Difference 0.4 0.1 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Difference explained as:Losses not allowable (in Guernsey) 0.7 0.1Effect of accounting for associate (0.3) – ––––––––––– –––––––––––

0.4 (0.1) ––––––––––– ––––––––––– ––––––––––– –––––––––––

** The associate has reported $0.3m tax charge for the period since acquisition, a 49 per cent. share of which is included in the $1.1mpost-tax profits reported by ARSS.

Although the Company has incurred a loss in the period there is no carried forward tax losses given thenil rate.

8. Loss per ShareThe calculation of the basic and diluted loss per share is based on the following data:

2014 2013 $’000 $’000

Loss for the purposes of basic loss per share (1,425) (155)

Number of shares 2014 2013

Weighted average number of ordinary shares for the purposes of basic and diluted loss per share 283,720,834 16,913,902Loss per Share (0.5p) (0.9p)

No options or instruments which might give rise to dilution were in issue during the year.

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9. Property, Plant and Equipment30 Jun 14

Furniture Motor equipment Vehicles Total $’000 $’000 $’000

CostAs at 1 July 2014 – – –Additions 7 174 181 ––––––––––– ––––––––––– –––––––––––

As at 30 June 2014 7 174 181 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

DepreciationAs at 1 July 2014 – – –Charge for the period (1) (6) (7) ––––––––––– ––––––––––– –––––––––––

As at 30 June 2014 (1) (6) (7) ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net book value at 30 June 2014 6 168 174 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net book value at 30 June 2013 – – – ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

10. Investment in Subsidiaries

Investments include

2014 2013 $’000 $’000

Investment in Subsidiaries 3 –

Country of registration/ Shares held incorporation Class %

Ardan Risk Holdings Limited Mauritius Ordinary 100Ardan Servicos Logisticos Limitada Mozambique Ordinary 100Ardan Servicos Medicos Limitada Mozambique Ordinary 100

Principal Activity

Ardan Risk Holdings Limited Investment HoldingArdan Servicos Logisticos Limitada Investment HoldingArdan Servicos Medicos Limitada Investment Holding

The Directors consider the carrying amount of investment in subsidiaries has not suffered anyimpairment loss.

11. Interest in Associate companies 2014 2013 $’000 $’000

Investment in Associate 4,000 –Share of Profit for Period 1,075 – ––––––––––– –––––––––––

TOTAL 5,075 – ––––––––––– ––––––––––– ––––––––––– –––––––––––

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Set out below are the associates of the group as at 30 June 2014, which, in the opinion of the directors,are material to the group. The associates listed have share capital consisting solely of ordinary shares,which are held directly by the group.

Country of registration/ Shares held incorporation Class %

Ardan Risk & Support Services Ltd Kenya Ordinary 49

Principal Activity

Ardan Risk & Support Services Ltd Provision of services at oil and gasexploration sites

The above companies are private companies and there is no quoted market price available for the shares.

There are no contingent liabilities relating to the group’s interest in the associates.

The Board identified the above named associate as an appropriate acquisition target and on 5 August2013 the Company entered into an acquisition agreement pursuant to which the Company agreed toacquire a 49 per cent. interest in the associate for a consideration of US$4m, satisfied by the issue of newOrdinary Shares. In addition, the Company was granted a period of exclusivity with a view to entering intoan agreement to acquire the remaining 51 per cent. interest in Ardan.

On 28 March 2014, the Company entered into a Framework and Option Agreement pursuant to which theassociate, overseen by the Company, undertook a corporate and contractual restructuring programme torationalise operational management, and implementation, planning and reporting. The Company was alsogranted a three year conditional call option to acquire 100 per cent. of ALK, a separate and new ‘shell’company from which the restructured business of ARSS would be operated.

On 26 September 2014 the Company exercised the call option granted to it pursuant to the frameworkand option agreement announced on 28 March 2014, to acquire the entire issued share capital of ALK.Following receipt of shareholder approval for the Acquisition granted at a general meeting held on22 October 2014 the Company completed the acquisition of ALK.

Set out below are the summarised financial information for the above named companies which areaccounted for using the equity method.

Summarised statement of Financial position:

Ardan Risk and Support Services Limited

30 Jun 14 $’000

CURRENTCash and cash equivalents 2,055Trade & other Receivables 11,203Other current assets 405 –––––––––––Total current assets 13,663 ––––––––––– –––––––––––Financial liabilities (excluding trade payables) (979)Other current liabilities (including trade payables) (7,835) –––––––––––Total current liabilities (8,814) ––––––––––– –––––––––––NON-CURRENTAssets 7,131Financial liabilities (955)Other liabilities (9,499) –––––––––––Total non-current liabilities (10,454) ––––––––––– –––––––––––NET ASSETS 1,526 ––––––––––– –––––––––––

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Summarised statement of Comprehensive position:

Ardan Risk and Support Services Limited

5 Aug 13 – 30 Jun 14 $’000

Revenue 32,646Depreciation and amortisation (1,121)Net finance costs (426) –––––––––––

Profit from continuing operations 2,508 –––––––––––

Income tax expense (315) –––––––––––

Post-tax profit from continuing operations 2,193 –––––––––––

Other comprehensive income – –––––––––––

Total comprehensive income 2,193 ––––––––––– –––––––––––

Dividends received from associate –

Key sources of estimation uncertaintyIn the application of the accounting policies, the directors are required to make judgments, estimates andassumptions about the carrying amount of assets and liabilities that are not readily apparent from othersources. The estimates and associated assumptions are based on historical experience and other relevantfactors. Such estimates and assumptions are reviewed on an ongoing basis. Revisions to estimates arerecognized prospectively.

The directors have made the following estimates that have a significant risk of resulting in a materialadjustment to the carrying amounts of assets and liabilities within the next financial year.

� Impairment of receivables – the group reviews their portfolio of receivables at the reporting date.In determining whether receivables are impaired, the management makes judgment as to whetherthere is any evidence indicating that there is a measurable decrease in the estimated future cash flowsexpected.

� Useful lives of property, plant and equipment – Management reviews the useful lives and residualvalues of the items of property, plant and equipment at each reporting date. During the financial periodsunder review, the directors determined no significant changes in the useful lives and residual values.

Significant judgments made by management in applying the group’s accounting policiesDirectors have made the following judgements that are considered to have the most significant effect onthe amounts recognised in the financial statements:

� Revenue recognition – In making their judgement, the directors considered the detailed criteria forthe recognition of revenue as set out in IAS 18 and, in particular, whether the group had transferred tothe buyer the significant risks and rewards of ownership of the services.

� Control of entities combined – The directors of have assessed whether or not the group hascommon control over each of the entities whose financial statements have been combined. In makingtheir judgment, the directors considered for each entity, the shareholders of each entity and the levelof influence of the directors on the operating and financial policies of each of the entities whosefinancial statements have been combined.

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Borrowings

2014 2013 USD USD

Non-currentFinance leases 954,707 1,273,829 ––––––––––– –––––––––––

954,707 1,273,829 ––––––––––– ––––––––––– ––––––––––– –––––––––––

CurrentFinance leases 976,390 1,231,345Bank overdraft 2,836 86,283 979,226 1,317,628 ––––––––––– –––––––––––

Total borrowings 1,933,933 2,591,457 ––––––––––– ––––––––––– ––––––––––– –––––––––––

� Maturity of non-current borrowings is between 2 to 5 years

� Maturity of current borrowings is in the next 12 months

Weighted average effective interest rates at the reporting date were:

2014 2013

Finance leases 7.25% p.a. 7.25% p.a.Bank overdraft 8.25% p.a. 8.25% p.a.

The exposure of the company’s borrowings to interest expense at the reporting date are as follows:

2014 2013 USD USD

Interest – Finance lease 160,384 164,246Interest – Overdraft 1,481 12,524 ––––––––––– –––––––––––

161,865 176,770 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Exchange rates applied

The financial statements are presented in United State Dollars (US$) as this reflects the Group’s plannedbusiness activities in the logistics sector in sub-Saharan Africa.

The following exchange rates have been applied in the preparation of the financial statements. A mean rateof Kshs 85.50 to the US$ has been used to translate transactions in Kenya shillings (Kshs) to United StatesDollars (US$).

Exchange Exchange rate rateMonth (US$/Kshs) (US$/GBP)

Jul-13 87.10 1.48Aug-13 87.25 1.51Sep-13 86.00 1.55Oct-13 85.00 1.56Nov-13 86.25 1.57Dec-13 86.05 1.60Jan-14 86.10 1.61Feb-14 86.05 1.61Mar-14 86.00 1.62Apr-14 86.61 1.63May-14 87.30 1.64Jun-14 87.25 1.63

86

The financial statements for Ardan Risk and Support Services Limited are set out below

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the period from 5 August 2013 to 30 June 2014 Noted USD

Revenue 3 29,755,314Cost of sales 4 (20,077,052) –––––––––––––––––––

Gross profit 9,678,262 ––––––––––––––––––– –––––––––––––––––––

Other income 5 231,189ExpenditureEmployment costs Annexe 1 (2,029,232)Administration expenses Annexe 1 (3,416,861)Establishment expenses (1,927,194) –––––––––––––––––––

Operating profit/(loss) 2,536,164Finance costs 6 (361,835) –––––––––––––––––––

Profit /(loss) before income tax 2,174,329Income tax charge 8 (315,897) –––––––––––––––––––

Profit for the period 1,858,432 –––––––––––––––––––

Other comprehensive incomeProfit for the period attributable to shareholders 1,858,432 ––––––––––––––––––– –––––––––––––––––––

87

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the period from 5 August 2013 to 30 June Note USD

Revenue 3 32,645,817Cost of sales 4 (22,463,435) –––––––––––––––––––

Gross profit 10,182,382 ––––––––––––––––––– –––––––––––––––––––

Other income 5 231,189ExpenditureEmployment costs Annexe 1 (2,029,232)Administration expenses Annexe 1 (3,516,523)Establishment expenses Annexe 1 (1,933,151) –––––––––––––––––––

Operating profit/(loss) 2,934,665 –––––––––––––––––––

Finance costs 6 (425,950) –––––––––––––––––––

Profit/(loss) before income tax 2,508,715 –––––––––––––––––––

Income tax charge 8 (315,897) –––––––––––––––––––

Profit for the period 2,192,818 –––––––––––––––––––

Other comprehensive income 0 –––––––––––––––––––

Profit for the period attributable to shareholders 2,192,818 ––––––––––––––––––– –––––––––––––––––––

88

CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2014

2014Assets Note USD

Non current assetsProperty, plant and equipment 10 (a) 6,764,608Intangible assets 11 47,382Prepaid operating lease rentals 12 43,875Deferred tax asset 13 275,549 –––––––––––––––––

7,131,414 –––––––––––––––––

Current assetsInventory 14 402,439Trade and other receivables 15 11,203,225Cash and cash equivalents 2,054,517Tax recoverable 17 2,638 –––––––––––––––––

13,662,819 –––––––––––––––––

Total assets 20,794,233 ––––––––––––––––– –––––––––––––––––

Equity and LiabilitiesCapital and reservesIssued capital 18 49,469Branch capital contribution 205,973Retained earnings 1,270,799 –––––––––––––––––

1,526,241 –––––––––––––––––

Non current liabilitiesBorrowings 20 954,707Deferred tax liability 13 –Due to related parties 21 8,744,235Directors balances 21 755,302 –––––––––––––––––

10,454,244 –––––––––––––––––

Current liabilitiesTrade and other payables 19 7,834,522Borrowings 20 979,226Tax payable 17 – –––––––––––––––––

8,813,748 –––––––––––––––––

Total equity and liabilities 20,794,233 ––––––––––––––––– –––––––––––––––––

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COMPANY STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2014

Assets Note USD

Non current assetsProperty, plant and equipment 9 6,764,608Intangible asset 10 47,382Prepaid operating lease rentals 11 43,875Deferred tax asset 12 275,549 –––––––––––––––––

7,131,414 –––––––––––––––––

Current assetsInventories 13 402,439Trade and other receivables 14 10,381,874Cash and cash equivalents 15 1,972,702Tax recoverable 2,638 –––––––––––––––––

12,759,653 –––––––––––––––––

Total assets 19,891,067 ––––––––––––––––– –––––––––––––––––

Equity and LiabilitiesCapital and reserveIssued capital 17 49,469Retained earnings (1,128,615)Branch capital contribution 205,973 –––––––––––––––––

(873,173) –––––––––––––––––

Non current liabilitiesBorrowings 19 954,707Due to related parties 20 11,117,108Directors balances 20 137,948 –––––––––––––––––

12,209,763 –––––––––––––––––

Current liabilitiesTrade and other payables 18 7,575,251Borrowings 19 979,226 8,554,477 –––––––––––––––––

Total equity and liabilities 19,891,067 ––––––––––––––––– –––––––––––––––––

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Share Branch Retained Capital Capital Earnings TotalPeriod ended 30 June 2014 USD USD USD USD

At 5th August 2013 49,469 – (1,851,419) (1,801,950)Prior year adjustment (note 22) – – 940,377 940,377 ––––––––––– ––––––––––– –––––––––––– ––––––––––––

As restated 49,469 – (911,042) (861,573)Branch reserve requirement (note 18 b) – 205,973 – 205,973Profit for the period – – 2,192,818 2,192,818Translation difference – – (10,978) (10,978) ––––––––––– ––––––––––– –––––––––––– ––––––––––––

At 30 June 2014 49,469 205,973 1,270,798 1,526,240 ––––––––––– ––––––––––– –––––––––––– –––––––––––– ––––––––––– ––––––––––– –––––––––––– ––––––––––––

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COMPANY STATEMENT OF CHANGES IN EQUITY Share Retained Branch Total Capital Earnings Capital CapitalPeriod ended 30 June 2014 USD USD USD USD

At 5 August 2013 49,469 (3,075,897) – (3,026,428)Prior year adjustment (note 22) – 61,075 – 61,075 ––––––––––– –––––––––––– ––––––––––– ––––––––––––

As restated 49,469 (3,014,822) – (2,965,353)Branch reserve requirement (note 18 b) – – 205,973 205,973Translation difference – 27,775 – 27,775Profit for the period – 1,858,432 – 1,858,432 ––––––––––– –––––––––––– ––––––––––– ––––––––––––

At 30 June 2014 49,469 (1,128,615) 205,973 (873,173) ––––––––––– –––––––––––– ––––––––––– –––––––––––– ––––––––––– –––––––––––– ––––––––––– ––––––––––––

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CONSOLIDATED STATEMENT OF CASH FLOWS

Reconciliation of operating Profit to net cash 2014outflow in operating activities Note USD

Operating profit before taxation 2,508,715Add back:Depreciation of property, plant and equipment 9 1,112,441Amortisation of operating lease 11 2,925Amortisation of intangible assets 10 5,265Tax paid 16 (92,064)Loss on disposal of property, plant and equipment –Non – Controlling interest –Net loss on discontinued entity –Translation difference 145,518 –––––––––––––

Prior year adjustments 3,682,800 –––––––––––––

Changes in working capitalIncrease in inventories (112,930)Increase in trade and other receivables (4,152,088)Increase in trade and other payables (1,389,198) –––––––––––––

(5,654,216) –––––––––––––

Net cash generated from operating activities (1,971,416) –––––––––––––

Investing activitiesProceeds from disposal of property, plant and equipment –Purchase of intangible asset (52,647)Purchase of property, plant and equipment 9 (4,627,405) –––––––––––––

Net cash used in investing activities (4,680,052) –––––––––––––

Financing activitiesBranch reserve requirement (note 18 b) 205,973Borrowings (574,077)Related party balances 2,856,069Directors account 686,322 –––––––––––––

Net cash generated from financing activities 3,174,288 –––––––––––––

Net increase in cash and cash equivalents (3,477,180) –––––––––––––

Movement in cash and cash equivalentsAt start of the period 5,528,861Movement during the period (3,477,180) –––––––––––––

At end of period 2,051,681 ––––––––––––– –––––––––––––

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COMPANY STATEMENT OF CASH FLOWSReconciliation of operating Profit/(loss) to net 2014cash outflow in operating activities Note USD

Operating profit/(loss) before taxation 2,174,329Add back:Depreciation of property, plant and equipment 9 1,112,441Amortisation of intangible assets 5,265Amortisation of prepaid operating lease rentals 2,925Brought foward tax reallocated to other receivables –Tax paid (92,064)Translation difference 40,385Prior year adjustment 61,075 –––––––––––––

3,304,356 ––––––––––––– –––––––––––––

Changes in Working capitalIncrease in inventories (112,930)Increase in trade and other receivables (3,840,417)Trade and other payables 478,604 (3,474,743) –––––––––––––

Net cash generated from operating activities (170,387) –––––––––––––

Investing activitiesPurchase of property, plant and equipment 9 (4,627,405)Purchase of intangible assets (52,647)Investment – Nature systems Ltd –Proceed from disposal of motor vehicle – –––––––––––––

Net cash used in investing activities (4,680,052) –––––––––––––

Financing activitiesBranch reserve requirement (note 18 b) 205,973Borrowings (574,077)Related party balances 1,975,133Directors account 68,967 –––––––––––––

Net cash generated from financing activities 1,675,996 –––––––––––––

Net (decrease)/increase in cash and cash equivalents (3,174,443)Movement in cash and cash equivalentsAt start of the period 5,147,145Movement during the period (3,174,443) –––––––––––––

At end of period 1,972,702 ––––––––––––– –––––––––––––

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. Significant Accounting PoliciesThe principal accounting policies adopted in the preparation of the financial statements are set out below.

a) Basis of preparation The financial statements are prepared on a going concern basis in compliance with International

Financial Reporting Standards (IFRS). The measurement basis used is the historical cost basis exceptwhere otherwise stated in the accounting policies below. The financial statements are presented inUS Dollars (USD).

The financial statements comprise a statement of comprehensive income, statement of financialposition, statement of changes in equity, statement of cash flows, and notes. Income and expenses,excluding the components of other comprehensive income, are recognised in the statement ofcomprehensive income. Other comprehensive income is recognised in the statement ofcomprehensive income and comprises items of income and expense (including reclassificationadjustments) that are not recognised in the statement of comprehensive income as required orpermitted by International Financial Reporting Standard (IFRS). Reclassification adjustments areamounts reclassified to the statement of comprehensive income in the current period that wererecognised in other comprehensive income in the current or previous periods. Transactions with theowners of the group in their capacity as owners are recognised in the statement of changes in equity.

The preparation of financial statements in conformity with International Financial Reporting Standardsrequires the use of estimates and assumptions. It also requires management to exercise itsjudgement in the process of applying the accounting policies adopted by the group. Although suchestimates and assumptions are based on the directors’ best knowledge of the information available,actual results may differ from those estimates. The judgements and estimates are reviewed at the endof each reporting period, and any revisions to such estimates are recognised in the year in which therevision is made.

b) Basis of Consolidation The consolidated financial statements reflects the result of the financial statements of Ardan Risk and

Support Services Limited and its subsidiary companies, Ardan Risk and Support ServicesLtd(Ethiopia) and Ardan Risk and Support Services Ltd(Mauritius)respectively, as at31 December 2013.

Subsidiaries are consolidated from the date on which effective control is transferred to the Group andconsolidation ceases from the date of disposal. All intercompany transactions, balances andunrealised gains on transaction between group companies are eliminated, Where necessary,accounting policies for affiliates have been changed to ensure consistency with the policies adoptedby the group.

c) New and revised standards i) Adoption of new and revised standards

The following new and revised standards and interpretations have also become effective for thefirst time and have been adopted by the group where relevant to its operations:

Effective date

IFRS 10 Consolidated Financial Statements 01-Jan-13 IFRS 12 Disclosure of Interests in Other Entities 01-Jan-13 IFRS 13 Fair Value Measurement 01-Jan-13 IAS 1 – Presentation of financial statements (Amendments) 01-Jul-12 IAS 19 Employee Benefits 01-Jan-13 IAS 27 Separate Financial Statements (2011) 01-Jan-13

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The adoption of the above has had no material effect on the group’s accounting policiesor disclosures.

ii) New and revised standards and interpretations which have been issued but are not effective

The following revised standards and interpretations have been published but are not yet effectivefor the year beginning 1 January 2013. The company has not early adopted any of theseamendments or interpretations.

� IFRS 9 – Financial Instruments will eventually replace IAS 39 Financial Instruments,Recognition and Measurement. The new standard will be effective for annual periodsbeginning on or after 1st January 2015. The chapters published to date cover recognition,derecognition, classification and measurement of financial assets and financial liabilities.Most gains or losses on financial assets measured at fair value will then be recognised inprofit or loss, but the company will be able to make an irrevocable election to presentchanges in fair value of investments in equity instruments in other comprehensive income.

iii) New and revised standards and interpretations which have been issued but are not effective

Amendments to IFRS 10, “Consolidated financial statements”, IFRS 12, ‘Disclosures of interestsin other entities’ and IAS 27, ‘Consolidated and separate financial statements’ define aninvestment entity and requires the group not to consolidate its subsidiaries but instead tomeasure its subsidiaries at fair value through profit or loss in its consolidated and separatefinancial statements. These amendments are not effective until annual periods beginning on orafter 1 January 2014, with retrospective application permissible.

Amendments to IAS 36, Disclosure of recoverable amounts of non-financial assets, IAS 39,Novation of derivatives and IFRIC 21, Levies are not effective until annual periods beginning onor after 1 January 2014, with retrospective application permissible.

Amendments to IAS 32: The amendments to IAS 32 clarify existing application issues relating tothe offsets of financial assets and financial liabilities requirements. Specifically, the amendmentsclarify the meaning of “currently has a legally enforceable right of set-off and simultaneousrealization and settlement. The amendments to IAS 32 are not effective until annual periodsbeginning on or after 1 January 2014, with retrospective application required.

IFRS 14 Regulatory Deferral Accounts. IFRS 14 permits an entity which is a first-time adopter ofInternational Financial Reporting Standards to continue to account, with some limited changes,for ‘regulatory deferral account balances’ in accordance with its previous GAAP, both on initialadoption of IFRS and in subsequent financial statements. Applicable to an entity’s first annualIFRS financial statements for a period beginning on or after 1 January 2016

The Directors have assessed the potential impact of the above and expect that they will not havea significant impact on the group’s financial statements for June 2014.

d) Translation of foreign currencies On initial recognition, all transactions are recorded in the functional currency (the currency of the

primary economic environment in which the group operates), on reporting the group has translatedthe functional currency to US Dollar (USD)

Transactions in foreign currencies during the year are converted into the functional currency using theexchange rate prevailing at the transaction date. Monetary assets and liabilities at the statement offinancial position date denominated in foreign currencies are translated into the functional currencyusing the exchange rate prevailing as at that date. The resulting foreign exchange gains and lossesfrom the settlement of such transactions and from year-end translation are recognised on a net basisin the profit and loss account in the year in which they arise, except for differences arising ontranslation of non-monetary available-for-sale of financial assets, which are recognised in othercomprehensive income.

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e) Offsetting Financial assets and liabilities are offset and the net amount reported in the statement of financial

position only when there is a legally enforceable right to set off the recognised amounts and there isan intention to settle on a net basis, or realise the asset and settle the liability simultaneously.

i) Revenue recognition

Revenue represents the fair value of consideration received or receivable for the sale of goodsand services in the course of the group’s activities. It is recognised when it is probable that futureeconomic benefits will flow to the group and the amount of revenue can be measured reliably. Itis stated net of Value Added Tax, rebates and trade discounts.

• Sale of services are recognised upon performance of the service and customeracceptance based on rates prescribed in respective customer contracts.

ii) Civil income is recognised on the following basis as set out in customers contract 25 per cent.on mobilisation of machinery and personnel 65 per cent. on completion of the construction10 per cent. on issuance of completion certificate.

f) Property, plant and equipment All categories of property, plant and equipment are initially recognised at cost and subsequently

carried at cost less accumulated depreciation and accumulated impairment losses. Cost includesexpenditure directly attributable to the acquisition of the assets. Computer software, including theoperating system, that is an integral part of the related hardware is capitalised as part of thecomputer equipment.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, asappropriate, only when it is probable that future economic benefits associated with the item will flowto the group and the cost of the item can be measured reliably. Repairs and maintenance expensesare charged to the profit and loss account in the year in which they are incurred.

Increases in the carrying amount arising on revaluation are recognised in other comprehensive incomeand accumulated in equity under the heading of revaluation surplus. Decreases that offset previousincreases of the same asset are recognised in other comprehensive income. All other decreases arecharged to the statement of comprehensive income. Annually, the difference between depreciationcharge based on the revalued carrying amount of the asset charged to the statement ofcomprehensive income and depreciation based on the asset’s original cost is transferred from therevaluation surplus reserve to retained earnings.

Depreciation is calculated using the reducing balance method to write down the cost or the revaluedamount of each asset to its residual value over its estimated useful life using the followingannual rates:

Rate Kenya Motor vehicles 25.00% Computer 30.00% Furniture and Equipment 12.50% Camp equipment 12.50%

Ethiopia Computers 25.00% Motor vehicles 20.00% Furniture and Equipment 20.00% Camp equipment 20.00%

As no parts of items of property, plant and equipment have a cost that is significant in relation to thetotal cost of the item, the same rate of depreciation is applied to the whole item. The assets’ residual

97

values and useful lives are reviewed, and adjusted if appropriate, at each statement of financialposition date.

Full year’s depreciation is provided in the year of acquisition and none in the year of disposal. Gainsand losses on disposal of property, plant and equipment are determined by reference to their carryingamount and are taken into account in determining operating profit. On disposal of revalued assets,amounts in the revaluation surplus reserve relating to that asset are transferred to retained earnings.

g) Intangible assets Computer software licence costs and computer software that is not an integral part of the related

hardware are initially recognised at cost, and subsequently carried at cost less accumulatedamortisation and accumulated impairment losses. Costs that are directly attributable to theproduction of identifiable computer software products controlled by the company are recognised asintangible assets. Amortisation is calculated using the straight line method to write down the cost ofeach licence or item of software to its residual value over its estimated useful life using an annual rateof 20 per cent.

h) Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined using the

weighted average method. Net realisable value is the estimated selling price in the ordinary course ofbusiness, less the estimated costs of completion and selling expenses.

i) Borrowing costs Borrowing costs, net of any temporary investment income on those borrowings, that are attributable

to acquisition, construction or production of a qualifying asset are capitalised as part of the asset. Thenet borrowing cost capitalised is either the actual borrowing cost incurred on the amount borrowedspecifically to finance the asset; or in the case of general borrowings, the borrowing cost isdetermined using the overall weighted average cost of the borrowings on all outstanding borrowingsduring the year less any specific borrowings directly attributable to the asset and applying this rate tothe borrowing attributable to the asset. Capitalisation of borrowing costs ceases when all activitiesnecessary to prepare the qualifying asset for its intended use or sale are complete. All other borrowingcosts are recognised in the profit or loss in the year in which they are incurred.

j) Income taxes Income tax expense is the aggregate amount charged/(credited) in respect of current tax and

deferred tax in determining the profit or loss for the year. Tax is recognised in the statement ofcomprehensive income except when it relates to items recognised in other comprehensive income,in which case it is also recognised in other comprehensive income, or to items recognised directly inequity, in which case it is also recognised directly in equity.

k) Current tax Current income tax is the amount of income tax payable on the taxable profit for the year, and any

adjustment to tax payable in respect of prior years, determined in accordance with the Fiscal Lawsof Kenya.

l) Deferred income tax Deferred income tax is provided in full on all temporary differences except those arising on the initial

recognition of an asset or liability, other than a business combination, that at the time of thetransaction affects neither the accounting nor taxable profit or loss. Deferred income tax is determinedusing the liability method on all temporary differences arising between the tax bases of assets andliabilities and their carrying values for financial reporting purposes, using tax rates and laws enactedor substantively enacted at the balance sheet date and expected to apply when the related deferredincome tax asset is realised or the deferred tax liability is settled.

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m) Cash and cash equivalents Cash and cash equivalents include cash in hand and demand and term deposits, with maturities of

three months or less from the date of acquisition, that are readily convertible to known amounts ofcash and which are subject to an insignificant risk of changes in value, net of bank overdrafts. In thestatement of comprehensive income, bank overdrafts are included as borrowings undercurrent liabilities.

n) Investment in subsidiaries/Consolidation Subsidiaries are all entities (including special purpose entities) over which the group has the power to

govern the financial and operating policies generally grouping a shareholding of more than one half ofthe voting rights. The existence and effect of potential voting rights that are currently exercisable orconvertible are considered when assessing whether the group controls another entity.

The group also assesses the existence of control where it does not have more than 50 per cent. ofthe ‘voting rights power but is able to govern the financial and operating policies of a subsidiary.Control may arise in circumstances where the size of the group’s voting rights relative to the size anddispersion of holdings of other shareholders give the group the power to govern the financial andoperating policies, etc.

o) Share capital Ordinary shares are classified as ‘share capital’ in equity. Any amounts received over and above the

par value of the shares issued are classified as ‘share premium’ in equity.

2. Risk Management Objectives and Policiesa) Financial risk management The group’s activities expose it to a variety of financial risks including credit, liquidity and market risks.

The group’s overall risk management policies are set out by the board and implemented by themanagement, and focus on the unpredictability of changes in the business environment and seek tominimise the potential adverse effects of such risks on the group’s performance by setting acceptablelevels of risk. The group does not hedge against any risks.

i) Credit risk

Credit risk is the risk that one party to a financial instrument will cause a financial loss for theother party by failing to discharge an obligation. Credit risk mainly arises from financial assets,and is managed on a group-wide basis. The group does not grade the credit quality of financialassets that are neither past due nor impaired.

Credit risk on financial assets with banking institutions is managed by dealing with institutionswith good credit ratings and placing limits on deposits that can be held with each institution.

Credit risk on trade receivables is managed by ensuring that credit is extended to customerswith an established credit history. The credit history is determined by taking into account thefinancial position, past experience and other relevant factors. Credit is managed by setting thecredit limit and the credit period for each customer. The utilisation of the credit limits and thecredit period is monitored by management on a monthly basis.

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The maximum exposure to credit risk as at the statement of financial position date is as follows:

Fully Past due but Past due and performing not impaired impaired Total Group USD USD USD USD

30-Jun-14 Trade receivables 6,727,873 1,015,128 – 7,743,001 Other receivables 4,475,352 – – 4,475,352 Cash in bank 2,054,103 – – 2,054,103 –––––––––––– –––––––––––– –––––––––––– ––––––––––––

13,257,329 1,015,128 – 14,272,457 –––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––

Fully Past due but Past due and performing not impaired impaired Total Company USD USD USD USD

30-Jun-14 Trade receivables 6,055,621 1,015,128 – 7,070,750 Other receivables 4,326,252 – – 4,326,252 Cash in bank 1,972,288 – – 1,972,288 –––––––––––– –––––––––––– –––––––––––– ––––––––––––

12,354,162 1,015,128 – 13,369,290 –––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––

ii) Liquidity risk

Liquidity risk is the risk that the group will encounter difficulty in meeting obligations associatedwith financial liabilities. The board has developed a risk management framework for themanagement of the group’s short, medium and long-term liquidity requirements therebyensuring that all financial liabilities are settled as they fall due. The group manages liquidity riskby continuously reviewing forecasts and actual cash flows, and maintaining banking facilities tocover any shortfalls.

The table below summarises the maturity analysis for financial liabilities to their remainingcontractual maturities. The amounts disclosed are the contractual undiscounted cash flows.

Between Between Over 1-3 months 3-12 months 1 year Total USD USD USD USD

30-Jun-14 Trade payables 3,545,028 1,331,151 – 4,876,179 Other payables 2,958,343 – – 2,958,343 Borrowings – Bank 2,836 976,390 954,707 1,933,933 ––––––––––– ––––––––––– ––––––––––– –––––––––––

6,506,207 2,307,541 954,707 9,768,455 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Between Between Over 1-3 months 3-12 months 1 year Total Company USD USD USD USD

30-Jun-14 Trade payables 3,510,788 1,331,151 – 4,841,939 Other payables 2,733,313 – – 2,733,313 Borrowings – Bank 2,836 954,707 976,390 1,933,933 ––––––––––– ––––––––––– ––––––––––– –––––––––––

6,246,937 2,285,858 976,390 9,509,185 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

iii) Market risk

Market risk is the risk that the fair value or future cash flows of financial instruments will fluctuatebecause of changes in market price and comprises three types of risk: Currency risk, interestrate risk and other price risk.

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Interest rate risk Interest rate risk is the risk that the value of financial instrument will fluctuate because of changes

in market interest rates. The group maintains a high interest cover ratio, which is the extent towhich profits are available to service borrowing costs. if the interest rates on the group’sborrowings at the year end were to increase/decrease by 1 per cent. with all other factorsremaining constant, the post-tax profit would be lower/higher by USD 2,203.

Currency risk Currency risk is the risk that the value of a financial instrument will fluctuate because of changes in

foreign exchange rates. The group is expensed to currency risk on sales and purchases that aredenominated in currency other than its functional currency, primarily the United States Dollar (USD).

Critical accounting estimates and judgements Estimates and judgments are continually evaluated and are based on historical experience and

other factors, including experience of future events that are believed to be reasonable underthe circumstances.

Critical accounting estimates and assumptions.

Fair value estimation The fair value of financial instruments that are not traded in an active market is determined by

using valuation techniques. The group uses its judgment to select a variety of methods andmake assumptions that are mainly based on market conditions existing at the statement offinancial position date.

Income taxes There are many transactions and calculations for which the ultimate tax determination is

uncertain during the ordinary course of business. The company recognizes liabilities foranticipated tax audit issues based on estimates of whether additional taxes will be due. Wherethe final tax outcome of these matters is different from the amounts that were initially recorded,such differences will impact the income tax and deferred tax provisions in the period in whichsuch determination is made.

Critical judgments in applying the entity’s accounting policies In the process of applying the group’s accounting policies, management has made judgments

in determining:

� the classification of financial assets and leases

� whether financial and non-financial assets are impaired.

3. Revenue Group Company 2014 2014 USD USD

Catering income 10,855,973 10,855,973Civil income 5,782,042 5,743,955Vehicle hire 2,677,492 2,677,492Camp rentals 7,322,158 6,228,809Medical income 4,791,424 3,084,037Management fees 655,212 655,212Office support and handling fees 312,372 260,692Waste management fees 249,144 249,144 ––––––––––––– –––––––––––––

32,645,817 29,755,314 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

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4. Cost of Sales Group Company 2014 2014 USD USD

Opening stock 288,073 288,073Direct cost (4.1) 22,577,801 20,191,418Closing stock (402,439.0) (402,439.0) ––––––––––––– –––––––––––––

22,463,435 20,077,052 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

4.1 Direct Cost Group Company 2014 2014 USD USD

Catering cost 6,487,280 6,487,280 Civils cost 5,618,673 5,618,673 Vehicle hire 1,082,218 1,082,218 Camp expenses 3,492,098 2,710,141 Medical cost 2,359,006 1,104,798 Travelling and accomodation 173,794 – Salaries and wages 2,841,359 2,841,359 Other cost 523,372 346,949 ––––––––––––– –––––––––––––

22,577,801 20,191,418 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

5. Other Incomes Group Company 2014 2014 USD USD

Interest income (191,747.0) (191,747.0)Creditors written off 39,442 39,442Other incomes 383,494 383,494 ––––––––––––– –––––––––––––

231,189 231,189 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

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6. Finance Cost Group Company 2014 2014 USD USD

Interest – Finance lease 252,386 189,287Interest – Bank overdraft 2,577 2,577Unrealised foreign exchange loss/(gain) 170,987 169,971 ––––––––––––– –––––––––––––

425,950 361,835 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

7. Operating Profit/Loss Group Company 2014 2014 USD USD

Items chargedThe following items have been charged in arriving at operating profit:Director remuneration 94,145 64,782Staff costs 2,029,232 2,029,232Depreciation 1,112,441 1,112,441 ––––––––––––– –––––––––––––

Audit fees 10,409 10,409 ––––––––––––– –––––––––––––

8. Tax Expense Group Company 2014 2014 USD USD

Current income tax 269,975 269,975Deferred tax charge/(credit) (Note 17) 45,922 45,922 ––––––––––––– –––––––––––––

Income tax credit 315,897 315,897 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

The tax on the company’s profit before tax differs from the theoretical amount that would arise usingProfit/Loss before tax expense 2,508,715 2,174,329 ––––––––––––– –––––––––––––

Tax calculated at a tax rate of 30% (2012: 30%) Tax effect of: 752,615 652,299– Expenses not deductible for tax purposes (436,717.0) (336,402.0)– Income not subject to tax ––––––––––––– –––––––––––––

Income tax expense/(credit) 315,897 315,897

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9. Property Plant and Equipment

Group Motor Furniture & Camp Computer Vehicles Fittings Equipment Total USD USD USD USD USD

Period ended 30 June 2014As at 5th August 2013Cost 75,752 1,523,698 2,690,729 335,676 7,840,024Additions 39,732 1,467,246 2,743,462 376,966 4,627,405Translation difference (1,871) (49,352) (7,691) (43,776) (102,690) ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

As at 30 June 2014 113,614 2,941,593 5,426,499 668,866 9,150,571 ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

DepreciationAs at 5th August 2013 38,003 699,777 461,898 87,701 1,804,308Charge for the period 18,254 507,015 520,690 66,481 1,112,441Translation difference (1,325) (775) 2,161 (13,916) (13,855) ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

As at 30 June 2014 54,932 1,206,016 984,749 140,266 2,385,964 ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net Book ValueAs at 30 June 2014 58,681 1,735,576 4,441,750 528,600 6,764,608

Company Motor Furniture & Camp Computer Vehicles Fittings Equipment Total USD USD USD USD USD

Period ended 30 June 2014CostAs at 5th August 2013 76,788 1,498,853 327,502 2,692,075 7,840,024Additions 39,732 1,467,246 376,966 2,743,462 4,627,405Translation difference (2,907) (24,507) (35,602) (9,037) (72,053) ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

As at 30 June 2014 113,614 2,941,593 668,866 5,426,499 9,150,571 ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

DepreciationAs at 5th August 2013 38,684 707,653 87,280 462,382 1,812,928Charge for the period 18,254 507,015 66,481 520,690 1,112,441Translation difference (2,006) (8,651) (13,495) 1,677 (22,475) ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

As at 30 June 2014 54,932 1,206,016 140,266 984,749 2,385,964 ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net Book ValueAs at 30 June 2014 58,682 1,735,577 528,600 4,441,750 6,764,607

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10. Intangible Group Company 2014 2014 USD USD

CostAt start of year – –Additions 52,647 52,647 ––––––––––––– –––––––––––––

At end of period 52,647 52,647 ––––––––––––– –––––––––––––

AmortisationAt start of period – –Charge for the period 5,265 5,265At end of period 5,265 5,265 ––––––––––––– –––––––––––––

Net book value 47,382 47,382 ––––––––––––– –––––––––––––

11. Prepaid operating Lease rental Group Company 2014 2014 USD USD

CostAs at start of period 66,029 66,029Addition – –Translation difference (7,529) (7,529) ––––––––––––– –––––––––––––

As at end of period 58,500 58,500 ––––––––––––– –––––––––––––

AmortisationAs at start of period 12,641 12,641Charge for the year 2925 2925Translation difference (941) (941) ––––––––––––– –––––––––––––

As at end of period 14,625 14,625 ––––––––––––– –––––––––––––

Net book value 43,875 43,875 ––––––––––––– –––––––––––––

Net book valueThese relates to prepaid expenses on business development for Ardan Ethiopia branch. The businessrelates to a hotel introduced by the branch. the initial cost were repair cost, furniture’s and equipment’s,labour expenses. The company deferred the expenses as no income was derived during the year. Thecompany decided to amortise the cost at 10 per cent. per annum.

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12. Deferred taxDeferred tax calculated, in full, on all temporary timing differences under the liability method usinga principal tax rate of 30 per cent. (2013: 30 per cent.). The movement on the deferred tax account isas follows

Group Company 2014 2014 USD USD

Year ended 30 June 2014As 5 august 2013 (128,786) 320,647Translation differences – 824Prior year adjustments 450,257 – ––––––––––– –––––––––––

As restated 321,471 321,471 ––––––––––– –––––––––––

Credit to profit and loss account (45,922) (45,922) ––––––––––– –––––––––––

As 30 June 2014 275,549 275,549 ––––––––––– –––––––––––

Deferred tax asset and (liabilities), deferred tax (charge)/ credit in the statement of comprehensive incomeare attributable to the following items

Credited/ charged At to profit At 30th 5 August and loss June USD USD USD

Deferred tax assetTax losses carried forward 321,471 (45,922) 275,549 ––––––––––– ––––––––––– –––––––––––

Net deferred tax asset 321,471 (45,922) 275,549 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Company Period ended 30 June 2014Deferred tax assetTax losses carried forward 320,647 (321,472) –Property plant and equipment (83,021) (83,021)Provision for impairment 304,538 304,538Unrealised foreign exchange loss 54,032 54,032 ––––––––––– ––––––––––– –––––––––––

Net deferred tax asset 320,647 (45,923) 275,549 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Year ended 31 December 2013 Deferred tax assetTax losses carried forward 320,647 – 320,647 ––––––––––– ––––––––––– –––––––––––

Net deferred tax asset 320,647 – 320,647 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

13. Inventories Group Company 2014 2014 USD USD

InventoryConsumables 402,439 402,439

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14. Trade and Other Receivable Group Company 2014 2014 USD USD

Trade receivables 7,743,001 7,070,750Less – Provision for impairments (1,015,128) (1,015,128) ––––––––––––– –––––––––––––

Net trade receivables 6,727,873 6,055,621Other receivables 4,475,352 4,326,252 ––––––––––––– –––––––––––––

11,203,225 10,381,874 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

15. Cash and Cash Equivalents Group Company 2014 2014 USD USD

Cash in hand 414 414Cash at bank 2,054,103 1,972,288 ––––––––––––– –––––––––––––

2,054,517 1,972,702 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

Cash and bank balances as above 2,054,517 1,972,702Bank overdrafts (Note 20 ) (2,836) – ––––––––––––– –––––––––––––

2,051,681 1,972,702 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

16. Tax Payable/Recoverable Group Company 2014 2014 USD USD

Balance brought forward 248,496 (181,877)Translation difference – 1,328Tax charge for the period 269,975 269,975Prior year adjustments (429,045) –Reallocation to receivables – –Tax paid during the period (92,064) (92,064) ––––––––––– –––––––––––

(2,638) (2,638) ––––––––––– ––––––––––– ––––––––––– –––––––––––

17. Share Capital

a) Ordinary Shares No. of Issued paid No. of Issued paid ordinary up capital ordinary up capital shares USD shares USD

As at 05 Agust 2013 42,530 49,469 42,530 49,469 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

At 31 December 2013 42,530 49,469 42,530 49,469 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

b) Branch Capital Requirement

The Company’s branch in Ethiopia operates under a commercial registration certificate which requiresbranch operating under such certificate to have a reserves of Birr 4,000,000 (USD 205,973).

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18. Trade and Other Payables Group Company 2014 2014 USD USD

Trade payables 4,876,179 4,841,939Other trade payables 2,958,343 2,733,313 –––––––––––– ––––––––––––

7,834,522 7,575,251 –––––––––––– –––––––––––– –––––––––––– ––––––––––––

19. Borrowings Group Company 2014 2014 USD USD

The borrowings are made up as follows:Non-current Bank Borrowings 954,707 954,707 ––––––––––– –––––––––––

954,707 954,707 ––––––––––– ––––––––––– ––––––––––– –––––––––––

CurrentBank overdraft (note 16) 2,836 2,836Bank borrowings 976,390 976,390 ––––––––––– –––––––––––

979,226 979,226 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Total borrowings 1,933,933 1,933,933 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Borrowings by:Ardan Kenya 1,900,483 1,900,483Ardan Ethiopia 33,450 33,450 ––––––––––– –––––––––––

1,933,933 1,933,933 ––––––––––– ––––––––––– ––––––––––– –––––––––––

The borrowings are secured by the following:

a) Facility letter dated 27th May 2013 supported by a Board resolution dated 27th May 2013.

b) A first ranking all assets debenture for USD 1,328,000 created by the borrower in favour of the Bank

c) A first ranking collateral charge for USD 130,000 and Kshs 28,000,000 created in favour of the Bank.

d) Joint and several personal guarantee and indemnity for USD 5,100,000 by the directors to cover theborrower’s indebtedness to the bank supported by certified copies of the guarantors’ national identitycards and/or passports.

e) Hire Purchase Agreements executed between Cfc Stanbic Bank Ltd and the company andlodgement with the bank of all the relevant logbooks to be jointly registered between the bank andthe company together with a duly executed blank transfer forms for the assets financed under thevehicle and asset financing facility.

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20. Related parties transactionsThe company is related to other companies which are related through common shareholding or commondirectorships.

i) Outstanding balances arising from transfer and receipt of funds from related parties

a) Receivable from related parties

Ardan Logistics Limited 77,320 – 77,320 – Ardan Risk and Support Services Ltd – Mauritius – 129,426 – – ––––––––––– ––––––––––– ––––––––––– –––––––––––

77,320 129,426 77,320 – ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

b) Payable to related Parties

Ardan Risk and Support Services Ltd – Hong Kong – 761,362 – 270,016 Ardan Risk and Support Services Ltd – Mauritius – 147,386 8,866,971 8,594,115 African Oilfield Logistic Limited 6,494,099 4,831,000 – – Ardan Risk Holding Limited 2,050,991 – 2,050,991 – Graham Pelham 179,671 180,567 179,671 180,567 Mike Pelham – Scott account 96,794 97,277 96,794 97,277 ––––––––––– ––––––––––– ––––––––––– –––––––––––

8,821,555 6,017,592 11,194,427 9,141,975 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Net payable to related party 8,744,235 5,888,166 11,117,107 9,141,975 ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

There are no fixed repayment terms or securities assigned to the above balances There are noimpairment provisions held against any related party balances

ii) Key management compensation Directors’ remuneration 63,572 64,701 63,572 64,701 ––––––––––– ––––––––––– ––––––––––– –––––––––––

Due to Directors 755,302 68,980 137,948 68,980 ––––––––––– ––––––––––– ––––––––––– –––––––––––

The loan from directors has no fixed repayment terms, is unsecured, interest free and the directorshave pledged continued support to meet the Company’s liabilities as and when they fall due.

a) Prior year adjustment

Prior year adjustments relates to differences in opening balances as a result of transferringbalances to the new accounting system plus prior year adjustments

b) Contingent liabilities

During the period under review, the company was being represented in a legal claim by a formeremployee, Ben Nguyo, based on the view that he was unfairly dismissed and he was claimingKshs 2,500,000 as damages for the same. Based on professional advice received from thecompany’s advocates, Anjarwalla and Khanna, the directors estimate that no material liability willarise on the case and hence no provision made in the financial statements.

c) Going concern

There exists a novation agreement to novate assets, liabilities and staff of the company, on acontract basis, to a newly formed associated company, Ardan Logistics Kenya Limited (ownedby Africa Oilfield Logistics Limited, name subsequently changed to Atlas Development andSupport Services Limited) and its subsidiaries. This will inevitably reduce the future operation ofthe company. The novation process has yet to be completed at the date of this report. This willimpact the going concern status of the company.

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d) Controlling shareholders

The directors are aware of the following interests of the controlling shareholders in regards to theissued share capital of the company:

Shareholding Name of Shareholder 2014

Michael Nigel Pelham 29% Jennifer Violet Pelham 8% Tracey Ruth Pelham 15% Mark Jenkins 0% Africa Oilfield Logistics Ltd 49% –––––––––––

100% ––––––––––– –––––––––––

e) Ultimate holding company

The ultimate holding company is Ardan Risk Holding Limited

Group Company USD USD

Employment costs Salaries and wages 1,546,503 1,546,503 Staff welfare 147,524 147,524 Other cost 335,205 335,205 ––––––––––– –––––––––––

2,029,232 2,029,232 ––––––––––– ––––––––––– ––––––––––– –––––––––––


Administration expenses Directors remuneration 94,145 94,145 Advertising and promotions 13,388 13,388 Bank charges 79,233 51,614 Audit fees 10,409 10,409 Computer expenses 591 591 Courier & postage 6,498 6,498 Generator running expenses 110,918 110,918 Entertainment expenses 2,655 2,655 Legal and professional fees 247,115 239,575 Mobile, telephone and internet costs 96,574 96,574 Motor vehicle expenses 140,120 140,120 Office expenses 72,025 72,025 Printing & stationery 48,663 48,663 Consultancy fees 461,629 461,629 Subscriptions 208 208 Transport and accomodation 357,005 350,982 General expenses 129,345 70,865 Clean up expenses 321,234 321,234 Office set up cost 110,250 110,250 VAT written off 217,192 217,192 Penalties Donations 2,253 2,253 Loss on disposal – – Provision for impairments 995,073 995,073 ––––––––––––– –––––––––––––

3,516,523 3,416,861 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

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Establishment expenses License 549 549 Insurance 271,430 265,473 Electricity and water 35,754 35,754 Rent 372,987 372,987 Repairs & maintenance 112,158 112,158 Security 19,642 19,642 Depreciation expenses 1,112,441 1,112,441 Amortisation of intangible assets 5,265 5,265 Amortisation of prepaid operating lease rentals 2,925 2,925 ––––––––––––– –––––––––––––

1,933,151 1,927,194 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

21. Trade and other receivablesAll non-current receivables are due within five years from the end of the reporting period.

2014 2013 $’000 $’000

Other Receivables 2,369 871Loans to associate 8,545 – ––––––––––––– –––––––––––––

10,914 871 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

Less non-current portion: loans to associate (8,545) – ––––––––––––– –––––––––––––

TOTAL CURRENT ASSETS 2,369 871 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

The effective interest rates on non-current receivables were 2.2 per cent.

The directors consider that the carrying amount of trade and other receivables approximates their fair value.

There are no significant amounts past due.

22. Cash and cash equivalents 2014 2013 $’000 $000

Cash and cash equivalents 3,132 9,162

23. Financial Liabilities 2014 2013 $’000 $000

Trade and other payablesTrade Payables 262 28Other Payables 115 508 ––––––––––––– –––––––––––––

Total trade and other payables 377 536 ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

Other payables principally comprise amounts outstanding for trade purchases and ongoing costs.

The directors consider that the carrying amount of financial liabilities approximates their fair value.

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24. Share capital Allotted and fully paidOrdinary shares of no par value Number $’000

At 30 June 2013 222,794,011 9,652Issue of shares 92,979,355 10,856 –––––––––––––– –––––––––––––

Total share Capital:At 30 June 2014 315,773,366 20,508 –––––––––––––– ––––––––––––– –––––––––––––– –––––––––––––

The Company has one class of ordinary share which carries no right to fixed income.

Between incorporation of the Company and 25 February 2013, 22 million ordinary shares were issued forcash at a price of 0.1 pence per ordinary share.

Between 9 May 2013 and 6 June 2013, 115,621,596 ordinary shares were issued for cash at a price of2 pence per ordinary share.

On 25 June 2013, 85,172,415 ordinary shares were issued for cash at a price of 5 pence per ordinary share.

On 9 August 2013, the Company issued and allotted 32,979,355 ordinary shares at a price of 8 pence perordinary share, as consideration for the acquisition of a 49 per cent. interest in Ardan.

On 20 December 2013, 60 million ordinary shares were issued for cash at a price of 7.5 pence perordinary share.

On 15 August 2014, 77.8 million ordinary shares were issued for cash at a price of 9.0 pence perordinary share.

On 23 October 2014, the Company issued 350,000 ordinary shares in part payment for services renderedby an advisor.

25. Movement in retained earnings 2014 2013 $’000 $’000

Prior Period Losses (155) –Loss for the period (1,425) (155) ––––––––––– –––––––––––

Retained Earnings (1,580) (155) ––––––––––– ––––––––––– ––––––––––– –––––––––––

26. Controlling partyThe Directors believe that there is no ultimate controlling party.

27. Related partiesPH Edmonds and AS Groves, Directors of the Group during the period, are (or were during the period) alsoDirectors of African Management Services Limited (“AMS”). Related party transactions are entered into onan arm’s length basis. No provisions have been made in respect of amounts owed by or to related parties.

During the year AMS provided accounting, treasury and administrative services to the Group for amanagement fee of $371k (2013: $18k). Amounts owed to AMS at the year-end were $115k (2013: nil).

During the year the Group provided various revolving credit facilities to the associate of $8,545k (2013: nil),at an interest rate of 2 per cent. above LIBOR. Amounts owed by the associate at the year-end were$8,545k (2013: nil).

After the period end, commission of $70k was paid to Ocelot Investment Group Limited, a companycontrolled by AS Groves.

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The remuneration of the Directors, who are the key management personnel of the Group, is set out innote 7.

28. Post balance sheet eventsi) On 15 August 2014, the Company raised approximately £7.0 million (approximately US$12.0 million)

before expenses by way of the issue of 77,800,000 new ordinary shares in the Company at a priceof 9 pence per share.

ii) On 26 September 2014 the Company exercised the call option (‘Call Option’) granted to it pursuantto the framework and option agreement announced on 28 March 2014 (‘Framework and OptionAgreement’), to acquire the entire issued share capital of Ardan Logistics Kenya Limited (‘ALK’) (the‘Acquisition’). Following receipt of shareholder approval for the Acquisition granted at a generalmeeting held on 22 October 2014 the Company completed the acquisition of ALK. The fair valueexercise will be completed prior to the announcement of interim results, no additional considerationhas been paid for the interest in AKL.

iii) On 23 October 2014, following shareholder approval for the Acquisition, the Company issued350,000 new ordinary shares at a deemed price of 10 pence per ordinary share, equating to £35,000in payment of advisor’s fees.

iv) On 28 October 2014, following shareholder approval at the general meeting held on 22 October2014, the Company’s name was formally changed to “Atlas Development & SupportServices Limited”.

v) On 5 November 2014 the Company’s shareholders passed resolutions which will enable theCompany to effect its proposed cross listing on the Growth Enterprise Market Segment of the NairobiSecurities Exchange by way of an introduction and private placing of up to 10 per cent. of theCompany’s enlarged share capital, such private placing being offered solely in Kenya. The resolutionspassed at the general meeting held on 5 November 2014:

� authorised the Board to issue up to 80,000,000 equity securities; and

� disapplied the pre-emption rights that would otherwise apply in respect of any issue of equitysecurities for cash.

29. Significant changes in tradingIn August 2013, Africa Oilfield Logistics (“AOL) purchased a 49 per cent. stake in Ardan Risk & SupportServices (K), (“Ardan”). Since this date, the principals of Ardan, together with input from AOL management,have identified that the operation of the Ardan business requires and will benefit from restructuring so as toimprove operational management and implementation, planning and reporting.

This restructuring plan comprises the following components:

� Restructure

Simplify the operational structure into 3 separate business divisions, Technical, Services and Logistics;and Recruit highly qualified divisional leadership.

� Recapitalise

AOL raised US$30m since listing on AIM to fund capital expenditure, working capitalrequirements and to settle outstanding legacy creditors.

� Professionalise

In addition to the recruitment and re-organization of the team and group structure, new systems andcontrols have been implemented, including Sage Payroll, Sage Accounting and Resource Planningand a new online document management system.

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The implementation of the above will increase efficiencies and productivity whilst also allowing forimproved economies of scale as the business grows and expands. This is evident upon analysis of thefinancial performance of Ardan during the first six months of 2014, in which the business hastransformed from losses in 2012 and 2013, to projected profits.

Key ManagementA key driver behind this turnaround is the addition of a highly experienced and qualified senior managementteam, which includes the following:

Carl Esprey, CEO: 12yrs in the natural resources industry at BHP Billiton and GLG Partners

Lachlan Monro, COO: Co-founder of Blue Hackle Group, 15yrs support services experience & formerBritish Army Officer

Barry Lobel, CFO: 12yrs experience, previously Director of Finance at Partners Capital, a US$12bnInvestment Office

Brendan Scott, Projects Director: Founder of ESP Sudan, a civil engineering business contracting tointernational clients

Nick Arnold, Regional Director: 20yrs military defence and support services, previously MD of GlobalStrategies Group

Patrick Ngahu, Finance Manager: 15yrs experience, qualified accountant, previously held senior financemanagement positions with DHL Supply Chain East Africa and Bridge International Academies

Ashley Fuller, Head of Technical Division: 28yrs military experience, Civil Engineer, previouslyRoyal Engineers

Paul Jordan, Head of Services Division: 25yrs British military experience specialising incommunications, logistics and field management

Colin Atkinson, Regional Quartermaster: 30yrs military expeditionary logistics experience

Gary Jones, MBE, Field Operations Manager: 30yrs British Army experience, specializing inexpeditionary logistics and facilities management to support up to 3,000 personnel.

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atlas development and support services listing statement

Documents

consolidated income

directors statement

proposed cross listing

important information

currentfinancial information

kenya equity market

general information

capital markets act