TIDMBEM
RNS Number : 3241Q
Beowulf Mining PLC
29 November 2016
29 November 2016
Beowulf Mining plc
("Beowulf" or the "Company")
Unaudited Interim Statement and Management Update for the Period
Ended 30 September 2016
Beowulf (AIM: BEM; Aktietorget: BEO), the mineral exploration
and development company, focused on the Kallak magnetite iron ore
project and the Åtvidaberg polymetallic exploration licence in
Sweden, and its graphite portfolio in Finland, announces its
unaudited consolidated financial results for the nine months ended
30 September 2016 and provides a management update.
The unaudited preliminary financial results for twelve months
ending 31 December 2016 and the next management update will be
released on or before 28 February 2017.
Overview of Activities in the Quarter
-- During the week of 4 July 2016, Kurt Budge, Chief Executive
Officer ("CEO") of Beowulf, attended Almedalen, an annual event in
Sweden, and met with representatives of the Swedish mining
industry, unions, politicians, local government representatives
from mining areas in Sweden and regulators. During these meetings,
the CEO presented Beowulf, the Kallak project and our Åtvidaberg
exploration licence to key influencers and stakeholders.
-- On 2 August 2016, the Company provided an exploration update
for its Haapamäki and Piippumäki graphite projects in Finland, and
the discovery of an additional prospective area in the eastern part
of Haapamäki, named Pitkäjärvi.
-- On 3 August 2016, the Company provided an exploration update
for its Åtvidaberg exploration licence, providing details on the
very positive findings from several reconnaissance field
excursions. To date, two main areas have been visited, Bersbo and
Mormor, where old mine workings, waste dumps and exploration pits
have been examined, showing evidence of zinc and copper
mineralisation.
-- On 4 August 2016, the Company provided an update on the
Kallak North Exploitation Concession stating that since the
Government's request to the Mining Inspectorate, to conduct a
further review of the Company's application for an Exploitation
Concession, the Company has continued its dialogue with key
stakeholders, with some interruption caused by the summer
holidays.
In all discussions, the Company has stated that it believes it
is in the best interests of its stakeholders in Sweden, and its
Swedish and non-Swedish shareholders, that the Company's
application be further reviewed by the Mining Inspectorate, so that
any future award of the Exploitation Concession is consistent with
the Supreme Administrative Council ("SAC") judgement in the case of
the Norra K rr project.
-- On 30 August 2016, the Company announced that it had been
awarded the Sala nr 10 exploration licence, in the V stmanland
County, southern Sweden, and covers an area of 1,049 hectares. The
licence is prospective for lead-zinc-silver mineralisation and is
situated 200 metres west of the former Sala silver mine.
-- On 21 September 2016, the Company submitted a letter to the
Mining Inspectorate of Sweden, revising its application boundary to
encompass both the Concession Area, delineated by the Kallak North
orebody, and the activities necessary to support a modern and
sustainable mining operation.
The revised boundary accounts for the judgement made by the SAC
of Sweden in the Norra Kärr case, which stated that activities
associated with a mining operation, but outside of the previously
considered Concession Area, need to be studied as part of an
application for an Exploitation Concession.
In the letter, the Company also reaffirmed the commitment it
made back in November 2014, in response to the concerns raised by
the County Administrative Board ("CAB") in October 2014 about a
specific transport corridor under consideration, to eliminate the
transport corridor that passes in a north-north-easterly direction
through the Jelka-Rimakåbbå Natura 2000 area.
-- On 30 September 2016, the Company provided an exploration
update for its graphite projects in Finland, detailing 'grab'
sampling and geological mapping undertaken at Haapamäki, and at two
newly discovered prospective areas, Pitkäjärvi and Aitolampi.
-- Loss after taxation attributable to the owners of the parent
company is GBP489,379 which is significantly below the loss for the
corresponding period last year (2015: loss of GBP1,111,171). The
loss in Q3 2016 of GBP156,327 is approximately 6 per cent below the
loss recorded in Q2 2016.
-- Cash and cash equivalents at 30 September 2016 of GBP978,999,
are GBP432,680 above the corresponding period last year and
GBP626,085 above the level at 31 December 2015.
Post Period End
-- On 7 October 2016, the Company provided an exploration update
for its Åtvidaberg exploration licence, including assays from
'grab' sampling. To date, only a small part of the licence area has
been studied, with resources focused on areas close to former
mines, and areas with known mineralisation and/or geophysical
anomalies.
-- On 14 October 2016, the Company announced the divestment of
its Grundtr sk nr 6 and nr 7 gold exploration licences to Erris
Resources Limited, a private exploration and development
company.
-- On 24 October 2016, the Company provided an update on the
Kallak North Exploitation Concession, informing shareholders that
the Mining Inspectorate of Sweden, in conducting a further review
of the Kallak North application as directed by the Government of
Sweden, and in the light of the SAC judgement in February 2016 in
the case of Norra Kärr, had written to the CAB for Norrbotten
County. The CAB was asked to respond by 16 December 2016.
-- On 24 October 2016, the Company announced the establishment
of a Swedish Advisory Board, and the appointment of two members, Mr
Per G. Broman and Mr Jan-Olof Hedström. The Swedish Advisory Board
has been established, to support the development of Beowulf's
projects in Sweden, first and foremost for Kallak, to provide
expert advice as the Company seeks an Exploitation Concession for
Kallak North, and thereafter the environmental permitting of that
project.
-- On 16 November 2016, the Company announced that the CAB had
granted an extension of time, from 16 December 2016 to 28 February
2017, by the Mining Inspectorate of Sweden, to respond to the
Inspectorate's questions as detailed in our 24 October release.
-- Between 22-25 November 2016, the Board visited Stockholm,
conducted a business review and board meeting, met key advisers,
and attended SveMin's autumn meeting (SveMin is an industry
association of mines, mineral and metal producers).
-- On 24 November 2016, Kurt Budge CEO presented at Avanza
Bank's Börsdag. The presentation can be viewed by following the
link below:
https://wonderland.videosync.fi/beowulf-mining
Kurt Budge, CEO, commented:
"During the last three months, we have continued to engage with
our stakeholders in Sweden, and I have visited Jokkmokk and Luleå
several times, most recently supported by our Swedish Advisory
Board, to conduct meetings in person, to assess if there is
anything further we can do as we seek the award of the Kallak North
Exploitation Concession.
"In September 2016, we submitted a revised plan for Kallak
North, showing both the Concession Area and the area required for
necessary supporting activities, and reaffirmed our commitment,
made back in November 2014, to eliminate the transport corridor
that passes in a north-north-easterly direction through the
Jelka-Rimakåbbå Natura 2000 area.
"More recently the Company's expert Swedish team has been
preparing a paper, which analyses the formal statements made since
October 2014, by different parties involved in the Kallak North
application process. The main objective of this analysis is to
demonstrate that the Company's application has satisfied the
requirements of Swedish law. The legal framework over the last two
years, for assessing our application, has not changed. The
perspective of the reviews completed, covering the Concession Area,
those activities necessary to support a modern and sustainable
mining operation, included in our Environmental Impact Assessment,
and transport options, is entirely consistent with the SAC
judgement in the case of Norra Kärr.
"This analysis is helping us to advance our thinking and
prioritise our stakeholder engagement for the next stage of
Kallak's development and environmental permitting, as we continue
to design into our plans the coexistence of mining activity and
reindeer herding, and seek a partnership which benefits the Saami
reindeer herding communities.
"In addition to Kallak, we have continued to provide updates on
our exploration activities in Finland and Sweden, for our graphite
assets and our polymetallic Åtvidaberg licence. Still early days,
but we will continue to fill out the picture for these business
areas, with further news flow in the coming weeks, results from
composite samples for our graphite and till sampling from
Åtvidaberg. This new information will be fed into our planning and
budgeting for 2017 work programmes.
"I look forward to updating shareholders on our progress in due
course."
Operational
Kallak North Exploitation Concession
The Company believes that the further review being conducted by
the Mining Inspectorate is in the best interests of our
stakeholders in Sweden, and our Swedish and non-Swedish
shareholders, so that any future award of the Exploitation
Concession is consistent with the SAC judgement in the case of the
Norra K rr project.
The CAB has a deadline of 28 February 2017 to respond to the
Mining Inspectorate of Sweden. The Company maintains it has
satisfied the requirements of Swedish law for this stage of
permitting.
Swedish Exploration Portfolio
Åtvidaberg - Recent Highlights
-- To date, only a small part of the licence area has been
studied, with resources focused on areas in proximity to former
mines, and areas with known mineralisation and/or geophysical
anomalies. The licence is split into two main areas: Bersbo to the
north-east; Mormors to the south-west.
-- In the Bersbo area, 'grab' samples from road fill of
sphalerite (zinc ore) have yielded up to 19.7 per cent zinc, while
samples from waste dumps of chalcopyrite (copper ore) have yielded
up to 1.7 per cent copper.
-- In the Mormor area, two waste dump samples have yielded 4.42
per cent and 8.46 per cent copper.
-- In addition, waste dump samples from Mormorsgruvan, with
quartz-veined mineralisation, have yielded up to 2.05 ppm gold.
-- 'Grab' samples were collected in isolation and therefore
cannot be considered representative of the grade of mineralisation
over a deposit, but nevertheless give a range of values, that are
indicative of the potential for the targets being investigated, and
which have assisted the Company's exploration team in planning
future work. All samples have been assayed for the Company by ALS
Minerals ("ALS") in Sweden.
-- Magnetic interpretation has given us a further 26 targets to
investigate, for which we are planning geological mapping and
ground geophysics to be carried out in 2017.
Overview of 2016 Work Programmes
Following a 'first impressions' visit to the area in May 2016, a
three-week fieldwork programme was conducted during mid-summer. The
programme included reconnaissance geological mapping, evaluation of
the mineral potential, ground magnetic surveys and 'grab' sampling
from waste dumps and outcrops. The Company has also completed a
review and interpretation of a series of magnetic datasets over the
licence area. A structural framework, focussed geological
interpretation of the district, has been compiled from a
combination of detailed and regional aero-magnetic data.
Overall, the work completed has given the Company's exploration
team a better understanding of the geology of the area and the
setting of different types of mineralisation. This has led to the
definition of several 'blind' exploration targets i.e. limited
outcrops because of glacial till cover, and the identification of
promising areas for further exploration.
The licence area is divided in two by the north-northwest
south-southeast striking Loftahammer-Linköping deformation zone. In
both lithotectonic domains the geology consists of a sequence of
metavolcanic rocks that are intruded by several granitic suites.
Mineralisation in the Bersbo mine area is characterised by
copper-zinc mineralisation, with some evidence of gold and silver,
together with pyrrhotite, that is stratabound in interlayered
felsic and mafic volcanic rocks. The mines in this area are marked
by narrow aeromagnetic anomalies.
In the western Mormors area, there are four former mines where
mineralisation occurs in deformation zones in potassium-altered
gneisses. The host rocks are altered to quartz-biotite-garnet
schists in which chalcopyrite occurs as veins and lenses. The
Mormor-type mineralisation is not obviously associated with
aeromagnetic anomalies.
Beowulf's exploration team has recently completed a till
sampling programme, for which we are awaiting assay results.
So far, our findings for the Åtvidaberg licence continue to be
positive. Below is a summary for the main prospects:
Bersbo
-- Former mines in the Bersbo area, including the Grönhög mine,
show evidence of high grade zinc mineralisation, that seems to have
been previously classed as waste, which is found in both waste
dumps and as road fill.
-- 'Grab' samples of sphalerite have yielded up to 19.7 per cent
zinc, while waste samples with chalcopyrite, have yielded up to 1.7
per cent copper.
-- The Bersbo ore occurs stratabound within interlayered felsic and mafic metavolcanic rocks.
-- The ore is often associated with pyrrhotite, which means that
aeromagnetic data can be used to trace potential
mineralisation.
Mormor
-- Mineralisation in the Mormors area appears to contain predominantly copper, and no zinc.
-- Two waste dump samples from the area have yielded 4.42 per cent and 8.46 per cent copper.
-- Quartz-veined samples from dumps at Mormorsgruvan have yielded up to 2.05 ppm gold.
-- The Company will continue to explore for copper ore and quartz-veined gold mineralisation.
-- The ore in the Mormors area is not consistently linked to
high magnetic susceptibility minerals, with aeromagnetic data for
the area showing that former mines do not lie on magnetic high
anomalies, but rather on the gradients.
-- In contrast, electromagnetic data shows that the former mines
lie on high conductivity zones, possibly resulting from the
presence of conductive copper mineralisation, together with
abundantly evident pyrite.
-- Mineralisation occurs in retrograde shear zones in
potassium-altered felsic rocks. The host rocks are often enriched
in biotite and quartz, are garnet-bearing, and often show intense
deformation.
-- Intense alteration by silification in metavolcanics, west of
the Mormors mine area, appears to be accompanied by an increase in
magnetite, but no significant mineralisation has been
identified.
Finnish Graphite
Haapamäki - Recent Highlights
-- Sampling and geological mapping have been undertaken at
Haapamäki, and at two newly discovered prospective areas,
Pitkäjärvi and Aitolampi.
-- The previously identified airborne electromagnetic ("EM")
anomaly from Pitk j rvi to Aitolampi extends more than 16
kilometres ("km") in length and up to 0.6 km in width, with the EM
conductive zone being associated with outcrops of graphite schist,
together with numerous graphitic boulders in glacially transported
till.
-- For the 13 "grab" samples taken at Pitkäjärvi, assays ranged
between 1.61 per cent and 13.4 per cent graphitic carbon
("Cg").
-- Two assays for "grab" samples taken from the Käärmerinne area
of Haapam ki, yielded 44.8 per cent and 45.2 per cent Cg.
Overview of 2016 Work Programmes
-- Sampling and geological mapping have been undertaken over an
area that has several historic workings, which correspond to ground
and airborne EM anomalies, identified by the Company's geophysical
survey with Slingram horizontal loop electromagnetic ("HLEM"),
completed in March 2016, and by historic airborne survey work
undertaken by Geological Survey of Finland ("GTK").
-- Identified conductive zones were located on the ground, in
most cases glacial till obscured possible graphite mineralisation,
but in some locations graphite mineralisation was located, mapped
and sampled; these included road cuttings, old quarries and pits,
outcrops and mineralised boulders.
-- 28 samples were assayed at Activation Laboratories
("Actlabs") in Canada. 15 samples taken at Haapam ki and 13 samples
taken at Pitk j rvi.
-- The results shown in this announcement are from
reconnaissance "grab" samples (of approximately 1.5 to 2 kilograms
each in weight) collected from mineralised outcrops and
boulders.
-- The samples were collected in isolation and therefore cannot
be considered representative of the grade of the mineralisation
over a deposit, but nevertheless give a range of values, some with
high Cg content, that are indicative of the potential at Haapamäki
and Pitkäjärvi, and which have assisted the field teams to
determine areas for further investigation.
-- Four composite samples for different areas have also been
prepared from the 'grab' samples collected for those areas, and
despatched to SGS Minerals Services in Canada for preliminary
metallurgical test-work, to evaluate graphite flake size and
distribution, and provide an indication of graphite concentrate Cg
grade.
-- The Company will wait for these results before finalising the
next stage of exploration work, which will likely include
trenching, and potentially, drilling.
Financials
-- Loss after taxation attributable to the owners of the parent company is GBP489,263 which is significantly below the loss for the corresponding period last year (2015: loss of GBP1,111,171). Last year's results were negatively impacted by an impairment charge of GBP851,613 because of the Company rationalising its project portfolio. The loss in Q3 2016 of GBP156,327 is approximately 6 per cent below the loss recorded in Q2 2016.
-- Basic/diluted loss per share for the period of GBP0.10 showed
a significant improvement over the loss per share for the
corresponding period last year (Sept 2016: GBP0.29) and the 2015
full year loss per share of GBP0.38.
-- Cash and cash equivalents at 30 September 2016 of GBP978,999,
are GBP432,680 above the corresponding period last year and
GBP626,085 above the level at 31 December 2015.
-- Intangible assets of GBP6,972,553, includes GBP311,812 for
the acquisition of Fennoscandian as detailed in note 5 in the
financial statements.
-- Share capital and share premium increased over the position
at 31 December 2015 mainly due to the fundraising in February and
March 2016 which raised net GBP1,432,500, and the initial shares
issued as part of the consideration for the Fennoscandian
acquisition (GBP25,500).
-- The merger reserve of GBP137,700 is in relation to the
Fennoscandian acquisition which was announced on 11 January
2016.
-- The translation reserve losses reduced from GBP1,090,348 at
31 December 2015 to GBP397,900 at 30 September 2016. This is mainly
due to further weakening of the pound following the Brexit vote. A
major proportion of the Company's exploration costs are in Swedish
Krona which has strengthened against the pound by approximately 11
per cent since 31 December 2015.
Corporate
-- The total number of ordinary shares in circulation at the
date of this announcement is 479,296,998 ordinary shares of GBP0.01
each, with each share carrying the right to one vote. The Company
does not hold any ordinary shares in treasury.
Competent Person Review
The information in this announcement has been reviewed by Mr
Rasmus Blomqvist, a Competent Person who is a Member of the
Australasian Institute of Mining and Metallurgy. Mr Rasmus
Blomqvist has sufficient experience, that is relevant to the style
of mineralisation and type of deposit taken into consideration, and
to the activity being undertaken, to qualify as a Competent Person
as defined in the 2012 Edition of the "Australasian Code of
Reporting of Exploration Results, Mineral Resources and Ore
Reserves".
Mr Rasmus Blomqvist is a full-time employee of Oy Fennoscandian
Resources AB, a 100 per cent owned subsidiary of Beowulf.
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
Enquiries:
Beowulf Mining plc
Kurt Budge, Chief Executive Tel: +44 (0) 20 3771 6993
Officer
Cantor Fitzgerald Europe
(Nominated Advisor & Broker)
David Porter / Phil Davies Tel: +44 (0) 20 7894 7000
Blytheweigh
Tim Blythe / Megan Ray Tel: +44 (0) 20 7138 3204
Cautionary Statement
Statements and assumptions made in this document with respect to
the Company's current plans, estimates, strategies and beliefs, and
other statements that are not historical facts, are forward-looking
statements about the future performance of Beowulf. Forward-looking
statements include, but are not limited to, those using words such
as "may", "might", "seeks", "expects", "anticipates", "estimates",
"believes", "projects", "plans", strategy", "forecast" and similar
expressions. These statements reflect management's expectations and
assumptions in light of currently available information. They are
subject to a number of risks and uncertainties, including, but not
limited to, (i) changes in the economic, regulatory and political
environments in the countries where Beowulf operates; (ii) changes
relating to the geological information available in respect of the
various projects undertaken; (iii) Beowulf's continued ability to
secure enough financing to carry on its operations as a going
concern; (iv) the success of its potential joint ventures and
alliances, if any; (v) metal prices, particularly as regards iron
ore. In the light of the many risks and uncertainties surrounding
any mineral project at an early stage of its development, the
actual results could differ materially from those presented and
forecast in this document. Beowulf assumes no unconditional
obligation to immediately update any such statements and/or
forecasts.
CONDENSED CONSOLIDATED INCOME STATEMENT
For the 9 months ended 30 September 2016
(Unaudited) (Unaudited) (Audited)
9 months 9 months Year
to to ended
Notes 30 Sept 30 Sept 31 Dec
2016 2015 2015
GBP GBP GBP
Continuing operations
Administrative expenses (493,870) (554,457) (647,268)
Impairment of exploration
costs - (851,613) (1,123,892)
------------ ------------ ------------
OPERATING LOSS (493,870) (1,406,070) (1,771,160)
Finance costs - - (139)
Finance income 4,549 1,325 1,982
------------ ------------ ------------
LOSS BEFORE TAX (489,321) (1,404,745) (1,769,317)
Tax - - -
------------ ------------ ------------
LOSS FOR THE PERIOD (489,321) (1,404,745) (1,769,317)
------------ ------------ ------------
Loss attributable to:
Owners of the parent (489,263) (1,111,171) (1,477,109)
Non-controlling interests (58) (293,574) (292,208)
------------ ------------ ------------
(489,321) (1,404,745) (1,769,317)
------------ ------------ ------------
Loss per share attributable
to the owners of the parent:
Basic and diluted (pence)
3 (0.10) (0.29) (0.38)
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 September 2016
(Unaudited) (Unaudited) As at (Audited)
As at 30 Sept 2015 As at
Notes 30 Sept 2016 31 Dec 2015
GBP GBP GBP
ASSETS
Non-current assets
Intangible assets 6 6,972,553 5,632,180 5,588,270
Plant, property and equipment 26,646 33,495 31,551
Loans and other financial assets 5,540 51,197 51,938
-------------- ------------------ -------------
7,004,739 5,716,872 5,671,759
-------------- ------------------ -------------
Current assets
Trade and other receivables 44,950 70,506 82,330
Cash and cash equivalents 978,999 546,319 352,914
-------------- ------------------ -------------
1,023,949 616,825 435,244
TOTAL ASSETS 8,028,688 6,333,697 6,107,003
-------------- ------------------ -------------
EQUITY
Shareholder's equity
Share capital 4 4,792,969 4,290,792 4,303,138
Share premium 16,167,782 15,174,459 15,187,112
Revaluation reserve (30,000) (30,000) (30,000)
Capital contribution reserve 46,451 46,451 46,451
Share-based payment reserve 224,954 104,370 97,796
Translation reserve (397,900) (1,158,719) (1,090,348)
Merger reserve 137,700 - -
Accumulated losses (12,955,309) (12,137,004) (12,466,046)
-------------- ------------------ -------------
7,986,647 6,290,349 6,048,103
Non-controlling interest (157,508) (167,696) (158,461)
-------------- ------------------ -------------
TOTAL EQUITY 7,829,139 6,122,653 5,889,642
-------------- ------------------ -------------
LIABILITIES
Current liabilities
Trade and other payables 199,549 211,044 217,361
-------------- ------------------ -------------
TOTAL LIABILITIES 199,549 211,044 217,361
-------------- ------------------ -------------
TOTAL EQUITY AND LIABILITIES 8,028,688 6,333,697 6,107,003
-------------- ------------------ -------------
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL
INFORMATION FOR THE 9 MONTHSED 30 SEPTEMBER 2016
1. Nature of Operations
Beowulf Mining plc (the "Company") is domiciled in England. The
Company's registered office is 201 Temple Chambers, 3-7 Temple
Avenue, London, EC4Y 0DT. This consolidated financial information
comprises the Company and its subsidiaries (collectively the
'Group' and individually 'Group companies'). The Group is engaged
in the acquisition, exploration and evaluation of natural resources
assets and has not yet generated revenues.
2. Basis of preparation
The condensed consolidated financial information has been
prepared on the basis of the recognition and measurement
requirements of International Financial Reporting Standards
("IFRS") as adopted by the European Union ("EU") and implemented in
the UK. The accounting policies, methods of computation and
presentation used in the preparation of the interim financial
information are the same as those used in the Group's audited
financial statements for the year ended 31 December 2015.
The financial information in this statement does not constitute
full statutory accounts within the meaning of Section 434 of the UK
Companies Act 2006. The financial information for the nine months
ended 30 September 2016 is unaudited, and has not been reviewed by
the auditors. The financial information for the year ended 31
December 2015 has been derived from the Group's audited financial
statements for the period. The auditor's report on the statutory
financial statements for the year ended 31 December 2015 was
unqualified and did not contain any statement under sections 498
(2) or (3) of the Companies Act 2006.
The financial statements are presented in GB Pounds Sterling.
They are prepared on the historical cost basis or the fair value
basis where the fair valuing of relevant assets and liabilities has
been applied.
3. Loss per share
Basic loss per share is calculated by dividing the loss
attributable to ordinary owners of the parent by the weighted
average number of ordinary shares of 469,331,096 (30 September
2015: 380,296,673 and 31 December 2015: 392,759,894) outstanding
during the period. There is no difference between the basic and
diluted loss per share.
4. Called up share capital
(Unaudited) (Unaudited) (Audited)
30 Sept 30 Sept 31 Dec
2016 2015 2015
GBP GBP GBP
Allotted, issued and
fully paid
Ordinary shares of 1p
each 4,792,969 4,290,792 4,303,138
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL
INFORMATION FOR THE 9 MONTHS ENDED 30 SEPTEMBER 2016
4. Called up share capital (continued)
The number of shares in issue was as follows:
Number
of shares
Balance at 1 January 2015 345,259,849
Issued during the period 83,819,407
-----------
Balance at 30 September 2015 429,079,256
Issued during the period 1,234,568
-----------
Balance at 31 December 2015 430,313,824
Issued during the period 48,983,174
-----------
Balance at 30 September 2016 479,296,998
5. Acquisition of Oy Fennoscandian Resources AB
("Fennoscandian")
On 11 January 2016, the Company announced it had acquired 100
per cent of the share capital of Fennoscandian, a privately owned
company based in Finland with a portfolio of four early-stage
graphite exploration projects. The transaction consisted of an
initial payment of 2.1 million shares with a deferred payment of
450,000 shares. Beowulf has paid for the 100 per cent of the share
capital of Fennoscandian by issuing 2.55 million ordinary shares in
the Company. On 11 January 2016, one Beowulf share was worth 6.4p,
valuing the initial part of the transaction at GBP163,200.
In addition, two further tranches of ordinary shares will be
issued on achievement of certain performance milestones. The first
tranche of ordinary shares will be issued on the production of a
maiden resource statement on one of the graphite projects in the
portfolio, or on the anniversary 24 months following completion of
the acquisition, subject to Mr. Blomqvist having worked for the
Company as a full-time employee during that period. The second
tranche of shares will be issued on completion of a bankable
feasibility study on one of the graphite projects in the portfolio.
The total number of ordinary shares that may be issued, if all
performance milestones are achieved, is 6.75 million ordinary
shares. Beowulf will issue up to a further 4.2 million additional
consideration shares in the form of a share-based payment
transaction to the former owner, Rasmus Blomqvist. The share-based
payments fall within the scope of IFRS 2 and are fair valued at the
grant date based on the estimated number of shares that will vest.
The fair value has been prepared using a Black-Scholes pricing
model including a share price of 6.4p, option life of two years,
volatility of 49.79 per cent and a risk free rate of 0.698 per
cent. The share-based charge is GBP268,800 bringing the total
consideration including transaction costs of GBP45,094 to
GBP477,094, if all additional shares are issued.
The consideration recognised in the financial statements as at
30 September 2016 is GBP311,812 and has been recorded in intangible
assets evenly across the four acquired graphite projects. The share
based payment charge is spread over the two-year option life,
therefore, in the nine months ended 30 September 2016 only
GBP97,076 (of the GBP268,800) has been recognised under
intangibles.
At a group level, the Company have considered whether the
acquisition meets the definition of a business combination and
therefore falls within the scope of IFRS 3. The conclusion is that
due to the early stage of the projects acquired and because
Fennoscandian does not have the inputs, processes and outputs
required to meet the conditions of a business combination the
acquisition shall be treated as an acquisition of assets at a group
level and is therefore outside the scope of IFRS 3.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL
INFORMATION FOR THE 9 MONTHS ENDED 30 SEPTEMBER 2016
6. Closing value of intangible assets
As at As at
30 31 December
September 2015
2016
Project GBP GBP
names Country Minerals
Ågåsjiegge Sweden Iron ore 7,337 -
Åtvidaberg Sweden Lead-zinc-copper-silver 99,893 -
Kallak Sweden Iron ore 6,405,110 5,565,328
Nautijaure Sweden Copper 25,184 22,942
Sala Sweden Lead-zinc-silver 2,389 -
Haapamäki Finland Graphite 117,715 -
Kolari Finland Graphite 87,876 -
Piippumäki Finland Graphite 99,915 -
Viistola Finland Graphite 95,813 -
Pitk j
rvi Finland Graphite 31,321
Total 6,972,553 5,588,270
============ =============
7. Availability of interim report
A copy of these results will be made available for inspection at
the Company's registered office during normal business hours on any
weekday. The Company's registered office is at 201 Temple Chambers,
3-7 Temple Avenue, London, EC4Y 0DT. A copy can also be downloaded
from the Company's website at www.beowulfmining.com. Beowulf Mining
plc is registered in England and Wales with registered number
02330496.
This information is provided by RNS
The company news service from the London Stock Exchange
END
QRTBPBTTMBJTBRF
(END) Dow Jones Newswires
November 29, 2016 02:00 ET (07:00 GMT)
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