NORDIC MINES AB (publ) (A translation)
Year-end report 2013
Fourth quarter 2013
* Net sales proceeds for gold and silver amounted to SEK 68.2 m. (SEK 76.4
* Impairment losses of Property, plant & Equipment has been recorded during
the quarter of SEK 535.4 m. considering the future business plan and of SEK
9.5 m. in relation to the new estimate of the mineral reserve.
* Impairment losses of immaterial assets of SEK 11.5 m. has been recorded
related to the capitalized exploration expenses in Sweden since the company
does not intend to renew the licenses.
* The company recorded an operating loss of SEK -610.5 m. (SEK -35.2 m.).
* The period's loss after tax amounted to SEK -603.3 m. (SEK -45.2 m.),
Â Â Â Â corresponding to SEK -1,77 (SEK -0,53) per share.
* The period's comprehensive income amounted to SEK -621.7 m. (SEK 40.5 m.),
corresponding to SEK -1,82 (SEK 0,47) per share.
* Cash and cash equivalents were SEK 28.1 m. (SEK 68.6 m.) at the end of the
* Investments were SEK 7.3 m. (SEK 36.2 m.).
* In total, 241 kilograms of gold (285 kilograms) were produced at the Laiva
* Since the filing for corporate reorganization, the bank consortium continues
to exercise an administrative possibility to retain payments from sales of
gold, which increases the risk of delayed or missed payments to other
creditors, such as suppliers, authorities and employees.
* On October 15, the Uppsala District Court decided that the reorganization
proceedings in the Swedish companies would continue an additional 3 months.
* On November 18, the UleÃ¥borg District Court granted an extension for
reorganization work until March 3, 2014.
* On November 27, the new estimates of the mineral resources and preliminary
estimates of the mineral reserves at the Laiva deposit were published.
Full year 2013
* Net sales proceeds for gold and silver amounted to SEK 325.3 m. (SEK 247.1
* The company recorded an operating loss of SEK -732.4 m. (SEK -155.3 m.).
* The period's loss after tax amounted to SEK -722.5 m. (SEK -176.6 m.),
Â Â Â Â corresponding to SEK -2.21 (SEK -3.01) per share.
* The period's comprehensive income amounted to SEK -625.9 m. (SEK -133.5 m.),
corresponding to SEK -1.93 (SEK -2.28) per share.
* Cash and cash equivalents were SEK 28.1 m. (SEK 68.6 m.) at the end of the
* Investments amounted to SEK 49.5 m. (SEK 111.8 m.), including an
environmental deposit of
* SEK 8.1 m. in the first quarter 2013.
* In total, 1,122 kilograms of gold (932 kilograms) were produced at the Laiva
* In January 2013, a preferential rights issue of SEK 282 million before issue
costs was oversubscribed without having to utilize the warranties.
* In April, the company settled its forward contract for the price of gold for
the volume for the second quarter of 2013 at a cost of EUR 150,000.
* In May, the company settled the total remaining balance of the forward
contract for the price of gold for 65,236 troy ounces for the period July
2013 to March 2015 at a cost of EUR 1.8 million.
* On July 8, 2013, Nordic Mines applied for corporate reorganization of all
non-dormant companies within the Group since the subsidiary's liquidity at
the end of June 2013 was strained.
* During the third quarter, a total of 44 employees in Finland were placed on
temporary unpaid leave, of which 17 terminated their employment during the
second half of the year. A total of 3 employees were laid off in Sweden in
Post balance sheet events
* On January 14, 2014, the Uppsala District Court decided that the
reorganization proceedings in the Swedish companies would continue an
additional 3 months.
* The legal proceedings initiated by a supplier during the fourth quarter were
concluded and paid in January 2014.
Comments from the CEO
"Work on a corporate reorganization plan and the search for alternative
"During the fourth quarter the company made material write-offs of Property,
Plants and Equipment, which had a negative impact of SEK 575.9 m. Adjusted
operating income was SEK -34.6 m., which is a slight improvement compared to the
In November 2013, the new estimates for the mineral resources at the Laiva mine
were published. In conjunction with the preliminary economic assessment (PEA) of
the mineral reserve and based on some additional assumptions, the company
drafted a business plan that shows a positive cash flow for the life of the mine
at Laiva. However, a restart of mining operations is dependent on a write-down
of debts in any future composition negotiations and additional external
financing. Thus, the search for an alternative financing also continues," opens
Thomas Cederborg, CEO.
In total, 241 kilograms of gold were produced during the fourth quarter,
compared to 259 kilograms during the third quarter. In total, 1,122 kilograms of
gold were produced for full year 2013, compared to 932 kilograms in 2012. Since
the end of July, the company has temporarily ceased mining in the mine in order
to gain cost savings during the reorganization efforts. During this period, the
processing plant is taking in ore from a previously mined layer, which contains
a lower head grade. As of December 31, there were 608,400 tonnes of ore in
stock, compared to 936,600 tons as of September 30, 2013. Processing plant
throughput was 380,192 tons of ore for the quarter and 1,483,913 tons for full
year 2013, compared to 1,028,980 for full year 2012.
Net sales proceeds were SEK 68.2 m. during the fourth quarter, compared to SEK
74.4 m. during the third quarter. The reduction is the result of lower
production due to a slightly lower head grade. Net sales proceeds for full year
2013 were SEK 325.3 m., compared to SEK 247.1 m. the previous year. The increase
is mainly due to higher production, although proceeds were negatively impacted
by the declining price of gold in 2013.
The company recorded a loss of SEK -610.5 m. in the fourth quarter, compared to
SEK -52.8 m. in the previous quarter. Loss for full year 2013 amounted to SEK
-732.4 m., compared to SEK -155.3 m. the previous year. The loss in the fourth
quarter is mainly due to impairment losses of total SEK 575.9 m. The production
costs were negatively impacted by SEK 13.0 m. for accruals related to updated
landscaping cost for restoring land at the Laiva mine. An impairment test
resulting in a write-down of property, plant and equipment in the amount of
Â SEK 535.4 m. in relation to the future business plan as well as of SEK 9.5 m.
related to the preliminary economic assessment (PEA) of the mineral reserve.
Administration costs were once again negatively impacted in the amount of SEK
10.0 m. for reorganization expenses for technical and legal support as well as
in the amount of SEK 11.5 m. in relation to a write-down of capitalized
exploration expenses in Sweden as the company intend to liquidate these assets.
Foreign exchange rate effects were positive in the fourth quarter in the amount
of net Â Â SEK 15.5 m., compared to a negative effect of net SEK 1.8 m. in the
third quarter. However, operating profit/loss continued to be positively
affected by cost savings in force since summer 2013, when the company
temporarily ceased mining in the mine, temporarily reduced personnel costs and
gained savings from relocating the crushing function.
Liquidity remained strained and amounted to SEK 28.1 m. as per December
31, 2013, compared to SEK 68.6 m. the previous year.
* On November 18, 2013, UleÃ¥borg District Court decided that the
reorganization proceedings would continue an additional three months and
ruled that a reorganization plan must be presented on March 3, 2014.
"The declining gold price in 2013 has negatively impacted the entire mining
industry. This has also resulted in weaker interest in investing in the
industry. With updated mineralization, mining methods and business plan combined
with a reduced cost base, we continue our search for alternative financing,"
concludes Thomas Cederborg, CEO.
For further information, please contact:
Thomas Cederborg, CEO, +46Â 708Â 480 521
Susanne Andersson, CFO, +46 730 668Â 904
For further information regarding Nordic Mines, please connect to
The information above has been made public in accordance with the Securities
Market Act and/or Financial Instruments Trading Act. The information was
published at 08.00 (CET) on October 31, 2013.
Nordic Mines is a Nordic mining and exploration company whose vision is to be
one of the leading gold producers in the Nordics and Europe and a role model in
respecting the environment. The company started mining gold in the Laiva mine in
Finland in summer 2011. These gold deposits are among the largest in the Nordic
region. Exploration is in progress in Finland and in Sweden. Nordic Mines was
established 2005 and have more the 100 employees with head office in Uppsala,
Sweden, The Nordic Mines share is traded on the Nasdaq OMX Small Cap list in
Nordic Mines AB (publ) Year-end report 2013:
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