Dannemora Mineral AB : Press release of unaudited annual earnings January - December 2007
Summary of significant events and results in 2007:
In June, Dannemora Magnetit AB submitted an application to the Environmental Court at Nacka District Court in regard to the resumption of operations in the Dannemora Mine.
Ore reserves in the Dannemora field have been estimated at 28.5 Million tons with 35.2% iron and 1.8% manganese (20.6 million tons of proven ore reserves with 35.1% iron and 1.8% manganese and 7.9 million tons of probable ore reserves with 35.3% iron and 1.7% manganese). With the assumptions made, this is sufficient for more than 12 years of mining operations at Dannemora.
With full production it is planned that 2.45 million tons of ore will be mined per year, which is estimated to give 1.5 million tons of processed products (50% lump ore and 50% fines).
Investment costs for resuming operation in the Dannemora Mine have been estimated at just under MSEK 840 spread over four years.
Operating costs at full production have been estimated at approx. SEK 179 per ton of processed products FOB Hargshamn, which equates to approx. SEK 109 per ton of ore.
Net present value (NPV) of the iron ore project has been calculated in the feasibility study as MSEK 956 with an 8% cost of capital. The average price of the processed products has been set at SEK 358 per ton (20% lower than the price in 2007 and without taking any payment for the manganese content into consideration).
The moraine sampling that was carried out during the year resulted in a number of anomalous gold areas along a belt running northwards from the Dannemora Mine.
In the autumn TEM measurements conducted by helicopter and in drill holes indicated a number of interesting electrical conductors in the bedrock.
During the year, the Dannemora Group has built up a well-functioning management organisation for the parent company and for both the subsidiary companies.
A new share issue and listing on the First North equity market were carried out during the year. The new share issue contributed SEK 85.4 million before issues costs to the Company.
Profit/loss after net financial items during the year amounted to MSEK -10.2 (-2.6). Profit/loss after net financial items in Q4 amounted to MSEK -5.3 (-0.9).
Cash flow from operating activities during the year amounted to MSEK -7.8 (-2.1). Cash flow from operating activities in Q4 amounted to MSEK -2.2 (-0.2).
Investments during the year totalled MSEK 17.6 (5.9). Investments during Q4 totalled MSEK 1.9 (3.8).
Cash equivalents as per 31 December 2007 totalled MSEK 63.5 (9.7).
Summary of important events during 2008:
Dannemora Mineral and Östhammar Municipality have agreed on the transfer of an area of land of approx. 400 ha from the municipality's private limited company Dannemora Gruvfastigheter to Dannemora Mineral.
During February, the Brazilian mining conglomerate Vale has negotiated price increases of 65% for iron ore with major Asian steel manufacturers such as Japan's Nippon Steel and South Korea's Posco.
The full report with tables can be downloaded from the following link:
