Summary of Interim Report January – September 2012

Highlights Q3/2012 vs. Q3/2011

  • Total revenues 42,009 KSEK (49,428) and gold delivered 165.9 kg (180.0)
  • EBITDA before unrealized loss on derivatives amounted to 11,054 KSEK (23,015)
  • Unrealized loss on derivates amounted to -4,986 KSEK (8,328) from continuing increasing gold forward prices
  • Operating profit amounted to -2,752 KSEK (23,148)
  • Profit after tax amounted to -9,723 KSEK (18,088)
  • Earnings per share amounted to -0.12 SEK (0.23)
  • Gold production amounted to 175.8 kg (182.1) and Cash Cost was 804 USD/oz (675)
  • Endomines entered into an agreement to sell all its shares in Kalvinit Oy to Cove Resources Ltd
  • Cash funds exceeded interest-bearing debt and amounted to 72,687 KSEK

Subsequent events

  • Endomines share was listed on the main market of Nasdaq OMX Stockholm as of November 7 2012.
  • Endomines has received from the North Karelia Centre for Economic Transport and the Environment an investment subsidy of up to 447 000 EUR.

Summary of key figures

Q3 Q1-Q3
KSEK, unless otherwise stated 2 012 2 011 change 2 012 2 011 change
Revenues 42,009 49,428 -7,419 160,678 114,337 46,341
EBITDA before unrealized loss on derivatives 11,054 23,015 -11,961 57,059 26,971 30,088
EBIT -2,752 23,148 -25,900 -1,942 7,656 -9,598
as % of revenues -6.6% 46.8% -1.2% 6.7%
Net result from continued operations -9,879 18 221 -28,100 -16,146 6,856 -23,002
Total net result -9,723 18 088 -27,811 -7,248 6,413 -13,661
Earnings per share, undiluted -0.12 0.23 -0,35 -0,09 0,08 -0,17
Gold production, kg 175.8 182.1 -6.3 589.1 432.2 156.9
Cash Cost, USD/oz 804 675 129 780 833 -53
Total cash flow 45,558 12,261 33,297 29,703 -12,248 41,951
Cash funds at end of period 72,687 54,635 18,052 72,687 54,635 18,052

Nine month summary

Total revenues amounted to 160,678 KSEK (114,337) and gold delivered to 583.5 kg (426.4). EBITDA before unrealized loss on derivates was 57,059 KSEK (26,971). Unrealized loss on derivates amounted to -32,162 KSEK (-1,377). Operating profit amounted to -1,942 KSEK (7,656) and profit after tax to -7,248 KSEK (6,413). Earnings per share amounted to -0.09 SEK (0.08). Cash funds amounted to 72,687 KSEK, an increase from the beginning of the year with 26,426 KSEK. Gold production amounted to 589.1 kg (432.2) and Cash Cost was 780 USD/oz (833).

Production guidance 2012
The Company maintains its gold production guidance for 2012 stating that the Company could potentially not reach the planned production level of 800 kg (25,700 oz) for the full year of production.

On November 7 2012 CEO Mark Ekberg rang the opening bell at Nasdaq OMX Stockholm. Endomines group management as well as the Company´s advisors were participating at the Listing Ceremony together with representatives from OMX Stockholm. The first share trades on the Endomines share were made at 6.70 per share. During the first three days a total of 159,000 shares were traded at prices between 6.35-6.70 per share. From November 7 Pareto Öhman AB acts as the Liquidity Provider for the Endomines share.


During the third quarter mining at Pampalo progressed stable. The ore was sourced from the average grade areas in the underground mine.

A power outage during the reporting period led to plant shutdown and disturbances for the underground production drilling during the third quarter. Despite the power outages processing plant utilization rate was very good 95 percent. The head grade in Q3/2012 was 3.2 g/t and was affected by the fact that the mining concentrated to the normal grade areas and also temporary need to use the marginal grade ore as the mill feed.  

Pampalo Gold Mines Safety performance is still improving and our own workforce has now worked 570 days without accidents, and our contractors over 220 days. Overall Lost Time Injury Frequency Rate (LTIFR[i] ) 10 is again clearly better than the industry average but the company remains committed to our overall safety target of “zero accidents”.

Quarterly production figures and rolling 12 months Q4-2011 Q1-2012 Q2-2012 Q3-2012 Roll 12 FY 2011
Mined ore (tonnes) 57,872 61,134 57,718 61,988 238,712 176,745
Milled ore (tonnes) 64,666 61,596 64,730 64,177 255,169 210,545
Head grade (Au gram/tonne) 3.3 3.2 4.4 3.2 3.5 3.4
Hourly utilization (%) 93.3 86.5 94.2 95.0 92.3 85.3
Gold recovery (%) 86.2 85.6 86.6 85.5 86.0 87.0
Gold production (kg) 183.7 168.8 244.5 175.8 772.8 615.9
Gold production (oz) 5,906 5,427 7,862 5,652 24,847 19,802
LTIFR (12 month rolling)1) 35 16 11 10 10 35
Cash cost (USD per oz)2) 918 878 692 804 812 864
OPEX/ (EUR/tonne) 69 65 76 64 69 68
OPEX/ (SEK/tonne) 629 579 675 535 605 614

[1] LTIFR = The Lost Time Injury Frequency Rate (LTIFR) is calculated as reported lost time injuries resulting in one day/shift or more off work per 1,000,000 hours worked.

2 Endomines calculates "Cash cost" per ounce figures using the guidance issued by The Gold Institute Production Cost Standard. Mining, ore processing and site administration and off-site smelting and refining costs are included to the “cash cost” but amortization, reclamation, capital and exploration costs are excluded, i.e. “Cash Cost” is calculated per payable ounces. “Cash Cost” figure is furnished to provide additional information and is a non-IFRS measure. Conversion from EUR to USD made by average rate for the period EUR/USD.

Our efforts to reduce mine site operating cost per mill feed tonne did gain results for the third quarter and operating cost / tonne was reduced from the previous period. The third quarter lower operating cost was a result of more stabilized underground mining operations as more ore tonnage could be mined and processed with the same workforce and clearly reduced overtime.  However, despite the lower operating cost per tonne, Cash Cost increased due to lower head grade and gold production during the period. The company will continue its efforts to reduce unit operating costs.

Pampalo capacity expansion project is progressing as planned and scheduled and the company expects all installations to be completed before the year end. The increased capacity can be utilized when the Pampalo environmental permit renewal has been approved and is in force, which is expected to happen early 2013. Endomines has applied for a capacity expansion to a maximum of 450,000 tonnes per annum but expects that it will be running the plant during the first years with an annual capacity of 330,000 – 380,000 tonnes.

During the reporting period Endomines has renewed the agreement to sell its flotation gold concentrate production from the Pampalo Gold Mine to Boliden. Endomines will deliver its estimated annual flotation concentrate production of 4,500 — 5,500 tonnes to Boliden's Harjavalta smelter in Finland. The agreement is signed for a period of two years, with the option of extending for a further two years subject to agreement.


Endomines has carried out further exploration drilling at its Korvilansuo property which is located on the Karelian Gold Line, near Ilomantsi, in Eastern Finland. The mineral rights of the property are fully owned by the Company.

The whole area Korvilansuo-Kivisuo-Elinsuo-Muurinsuo is located in the contact zone of the Kuittila-tonalite, which makes it a very promising target for further exploration works. In addition to already known mineral resources in Muurinsuo the area is promising and drilling will continue to determine the full potential of the whole area.

This recent core drilling campaign at Korvilansuo aimed at extending the gold mineralization discovered during the 2011 campaign. As already published on September 5, four new holes, 672.8m in total, were drilled, and have yielded intercepts including:

  • 34.2 m @ 2.04 g/t gold
  • 15.0 m @ 4.46 g/t gold
  •  9.8 m @ 2.15 g/t gold
  •  9.0 m @ 1.42 g/t gold
  •  6.0 m @ 1.01 g/t gold
  •  4.0 m @ 1.79 g/t gold
  •  1.0 m @ 9.79 g/t gold

Since these intersections drilling has continued but assays are still pending. All laboratories used by the company as well as other certified laboratories have reported serious overload problems resulting in significant delays in the assaying work. This will affect Endomines and results from these and other assays will be published later than originally planned.

Due to promising exploration results, Endomines has also decided to include the Korvilansuo property to the ongoing Karelian Gold Line Environmental Impact Assessment Study. The study is prepared by the environmental consulting company Linnunmaa Oy and is expected to be completed and filed in November 2012. The study covers the whole 40 km long Karelian Gold Line and includes all currently known deposits or advanced exploration targets Hosko, Kuivisto, Rämepuro, Muurinsuo, Korvilansuo and Kuittila.

The environmental work along the Karelian Gold Line will continue immediately with permit applications for the Rämepuro deposit, where target is commencing test mining during summer 2013. The permit application is prepared by Pöyry Finland Oy.


Endomines AB has on July 6 2012 entered into an agreement with Australian company Cove Resources Ltd. whereby Endomines agrees to sell all of its shares in its wholly-owned subsidiary, Kalvinit Oy to Cove Resources. Kalvinit Oy is focused on the development of industrial mineral ilmenite deposits and holds exploration rights to ilmenite deposits in the Kälviä area in Finland. The transaction covers all of Endomines ilmenite assets on the Finnish west coast. Kalvinit’s remaining limestone deposit claims have been transferred the wholly-owned subsidiary Kuovila Limestone Oy.


Endomines AB’s wholly owned subsidiary Endomines Oy has received from the North Karelia Centre for Economic Development Transport and the Environment, a positive decision of the investment subsidy of up to 447 000 EUR (3.8 MSEK) for the ongoing Pampalo processing plant capacity expansion. The subsidy can be a maximum of 25 percent of the total investments in equipment.

For further information, please contact:

Markus Ekberg                                                          
CEO of Endomines AB                                                                           
tel. +358 40 706 48 50                                                                          

Endomines AB discloses the information provided herein pursuant to the Swedish Securities Markets Act and/or the Swedish Financial Instruments Trading Act. The information was submitted for publication at 08:30 CET on November 12, 2012.

About Endomines AB

Endomines AB is a Nordic mining and exploration company with its first operating gold mine in production since February 2011. The mine is located in Eastern Finland, on the Karelian Gold Line, a 40 km long gold critical belt, where Endomines controls all currently known gold deposits.

The company has several other gold and industrial mineral properties at various stages of development. All Endomines’ mineral assets are located in Finland, which is politically stable, has a highly developed infrastructure and is ranked as one of the most favorable jurisdictions for the mining industry.

Endomines aims to increase shareholder value by developing its strong portfolio of assets, as well as exploring new deposits on the Karelian Gold Line and in Finnish Lapland. The company will also consider new opportunities and acquisitions for further growth.

The company’s business practices and mining operations are based on sustainable principles and on minimizing the impact on the environment.

Endomines applies SveMin's&FinnMin's respective rules for reporting (public mining & exploration companies). It has also chosen to report mineral resources and ore reserves according to the JORC-code, which is the internationally accepted Australasian code for reporting ore reserves and mineral resources.

The shares of Endomines AB are quoted on NASDAQ OMX Stockholm under ticker ENDO.ST. Pareto Öhman acts as Liquidity Provider.

Read more about Endomines on


This news release may contain forward-looking statements, which address future events and conditions, which are subject to various risks and uncertainties. The Company's   actual   results, programs and financial position could differ materially from those anticipated in such forward-looking statements as a result of numerous factors, some of which may be beyond the Company's control. These factors include: the availability of funds; the timing and content of work programs;   results   of exploration activities and development of mineral properties, the interpretation of drilling results and other geological data, the uncertainties of resource and reserve estimations, receipt and security of mineral property titles; project cost overruns or unanticipated costs and expenses, fluctuations in metal prices; currency fluctuations; and general market and industry conditions.

Forward-looking statements are based on the expectations and opinions of the Company's management on the date the statements are made. The assumptions used in the preparation of such statements, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.

About Us

Endomines consists of the parent company, Endomines AB, with two wholly owned subsidiaries: Endomines Oy and Kalvinit Oy. The operations of Endomines Oy include exploration and development of gold deposits and planned gold mining. Kalvinit Oy is focused on the development of the industrial mineral ilmenite deposits. The Company’s present mineral deposits are all located in Finland. The Company acquired all shares outstanding in the two subsidiaries, Endomines Oy and Kalvinit Oy, through a non-cash issue. These subsidiaries were founded in the mid-1990s and have been financed by private individuals and Finnish institutions since inception.



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