ENDOMINES Year-end report 2021

Endomines towards solid gold production

Endomines AB, Stock Exchange Release 25 February 2022 at 08:00 CET
Full year 2021 (vs. Full year 2020)

Operational highlights

●        Pampalo mine deepening; Decline reached the target level in September.

●        Pampalo ore production from mine development started in November. Gold produced was higher than budgeted and exceeded expectations.

●        Pampalo mill was refurbished and tested in December.

●        First ore batch was milled in the Pampalo mill and the first concentrate was delivered in January. 

●        Ramp up of mining and ore processing continued at the Friday operations throughout the quarter. 

●        No injuries reported in the last 12 months; LTIFR 0 (0).

Financial highlights

●        Total revenue including inventory change was 5.0 MSEK (13.1)

●        EBITDA was -118.2 MSEK (-108.0)

●        Total cash flow was 0.9 MSEK (-4.4)

●        Earnings per share was -1.31 SEK (-1.67)

Significant subsequent events

●        On January 4th 2022, Endomines announced that it resolved on a directed issue of convertibles to LDA Capital Limited.

●        On January 14th 2022, Endomines announced that Mikko Sopanen has been appointed as new CFO.

●        On January 24th 2022, Endomines announced that LDA Capital Limited partially converted its convertible loan.

●        On February 3th 2022, Endomines updated its’ production outlook for Friday mine. The mine and mill operation have temporarily been halted and emphasis is now exclusively on underground core drilling to better define ore shapes and boundaries. The ramp up is expected to continue once drill results are at hand and assuming core drilling results are in line with expectations.

●        On February 3th 2022, Endomines updated its’ production outlook for Pampalo. The mine ramp up continues, the gold ore produced so far is of higher-grade than planned and full production will be reached during Q1. Gold concentrate deliveries started in January and the mill has now reached over 60 % of its throughput capacity.

●        As announced February 18 th 2022, Endomines resolves on a fully guaranteed directed share issue of 28 571 429 shares to the Company´s noteholders, at a price of EUR 0.21 (corresponding to SEK 2.2211) per share, providing total issue proceeds of EUR 6,000,000 (corresponding to SEK 63,466,2011) before issue expenses.  Therefore, Endomines secures a significantly stronger financial position to enable further development and growth with the mining exploration and development.

Production update and outlook for 2022
  

The Pampalo underground deepening project achieved all critical milestones during 2021. The decline reached the bottom of the new production area in September, and ore production from mine development commenced in November. The mill maintenance program was successfully carried out, and mill test runs with ore started in December. Also, the first batch of concentrate was delivered in January. The planned production ramp up period is very short, and it is estimated that the Pampalo mine and mill reach full production capacity during Q1 2022. When in full production Endomines expects annual gold production from the Pampalo mine to come in between 10.000 and 11.500 oz.

In the summer and fall 2021 Endomines began upgrading the Orogrande process plant and ramp up of ore development and production at the Friday mine in Idaho, USA started.  Ore processing and ramp up of the plant has been ongoing during Q4 2021 and mill throughput has gradually increased and is nearing planned capacity. Due to the need to carry out more underground definition diamond drilling for further mine planning purposes, mining has temporarily been halted while all emphasis is placed the drilling program. Therefore, production outlook for Friday is under review and will be available only once the results of the drilling program are available.  

* LTIFR = The Lost Time Injury Frequency Rate is based on reported lost time injuries resulting in one day or more off work per 1,000,000 hours worked on a rolling 12-month basis. LTIFR has been calculated for the whole company including contractors.

** Adjusted EBITDA amounted to SEK -78.1 million in 2020, adjusted figures exclude final costs for US Grant mining claims.

Chairman Ingmar Haga: “I would like to thank our shareholders for their continuing support of the company and our employees for their strong efforts and dedication in moving our mining projects forward during one of the most important years in the company’s history.

I am pleased to report that we successfully placed the Pampalo mine in Finland back into production at yearend, and that the operation will ramp up to full capacity during Q1 2022. Underground drilling along the deep extensions of the ore lenses have resulted in some of the highest gold grade intersections ever received from the Pampalo mine.        

The Friday operations in Idaho started up in the fall and we have continued ramping up since. Mining of the first stopes and recent underground infill drill has revealed that there are irregularities in the shapes and form of the gold mineralisation. Therefore, much more closed spaced definition drilling will be required for mine planning purposes. Drilling will continue in 2022.     

I am also pleased to report that we completed our search for a permanent CEO and that Kari Vyhtinen was appointed new CEO effective March 1st, 2022. We have also been able to recruit a new permanent CFO, Mikko Sopanen. With our new management, I’m confident we’ll be able to successfully continue our mine building process and developing the mine project pipeline.”

For further information, please contact:

Seppo Tuovinen, interim CEO, +358 50 576 0143, seppo.tuovinen@endomines.com

Ingmar Haga, chairman of the board, +358 40 700 3518, ingmar.haga@endomines.com

This information is information that Endomines AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 08:00 CET on 25 February 2022.

About Endomines

Endomines is a mining and exploration company with its primary focus on gold. The Company explores for gold along the Karelian Gold Line in Eastern Finland and develops mining operations in Idaho, USA. Endomines aims to improve its long-term growth prospects by increasing its exploration activities and through acquisitions. Endomines aims to acquire deposits that are situated in stable jurisdictions and can be brought to production rapidly with limited investments.

The shares trade on Nasdaq Stockholm (ENDO) and Nasdaq Helsinki (ENDOM).

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