Unaudited Interim Statement and Management Update for the Quarter Ended 30 June, 2015

Beowulf (AIM: BEM; Aktietorget: BEO), the mineral exploration and development company focused on the Kallak iron ore project in northern Sweden and its Swedish exploration portfolio, announces its unaudited interim statement for the six months ended 30 June 2015 and provides a management update.

The next quarterly statement for the nine months ending 30 September 2015 will be released on or around Monday 30 November 2015.

Highlights:

• As announced in June 2015 metallurgical testwork carried out by GTK in Finland on Kallak North samples confirmed, that the project is capable of producing:
  • a ‘super’ high grade magnetite concentrate, with over 71 per cent. iron content and very low levels of deleterious elements; and
  • a ‘bonus’ high grade hematite concentrate with over 68 per cent. iron content providing additional upside.
  • The Company continues to work closely with key stakeholders in and around Jokkmokk, as well as with communities that could be affected by the development of the Kallak iron ore project.
  • The Company is in the process of completing a desktop review of the historical information on its other exploration projects, which will assist in the design of future exploration plans and capital allocation.
  • The Company has started to rationalise its exploration portfolio in 2015, reducing the total area held, while maintaining those licence areas which demonstrate the greatest potential.
  • Loss before and after taxation attributable to the owners of the parent of £330,276 (2014: loss of £1,317,313).
  • All of the resolutions put forward at the Annual General Meeting (‘AGM’), as set out in the Notice of AGM, were unanimously approved by shareholders, as well as receiving the full support of the Company’s largest shareholder.

Post Period Highlights:

•    An important step forward has been taken by the County Administrative Board (‘CAB’) for Norrbotten County when they published their response to the Swedish Government’s request for comments on the national economic assessment of the Kallak North iron ore project. The assessment concluded that:

o    mining was economically relevant to the area;
o    the project generates economic benefits at local, regional and national levels; and
o    the Concession area applied for by the Company creates no conflicts where national interests are considered and is designated as an Area of National Interest (“ANI”) for minerals.
•    £650,000 (gross) raised in July 2015 by the issue of approximately 52 million new ordinary shares.


Kurt Budge, Chief Executive Officer, commented:

“The Company is looking forward to a busy second half of the year and we are optimistic that momentum is in our favour for a positive decision on the Exploitation Concession for Kallak North. Once the Concession is in place, Kallak North will be significantly de-risked in the eyes of potential investors and strategic partners and well positioned to advance its development.
 
The Board would like to thank Jan-Ola for his enthusiasm and commitment to Beowulf over the past 10 years. Since his retirement on June 12 2015, the Board and management team of Beowulf has changed completely from that of August 2014.  With the change in leadership, Beowulf has re-established itself, strengthened its financial controls and governance procedures, re-focused the Company's strategy and aligned its interests with those of its shareholders. This all means that the Company is now in a stronger position, both operationally and financially.

The current management team has also demonstrated its commitment to sustaining the Company through a challenging period for junior explorer/developers, and adopted an approach in Sweden which is beginning to yield results.”

Operational

Exploitation Concession

An important step forward was taken on 7 July 2015 with the Company’s application for an Exploitation Concession for Kallak North, when the CAB for Norrbotten County published their response to the Swedish Government’s request for comments on the national economic assessment of Kallak North.

The CAB stated in their response that mining is economically relevant, and that the Kallak North project generates economic benefits at local, regional and national levels, including direct and indirect jobs, tax revenues, and more broadly across mining equipment and services sectors in Sweden.  In addition, the CAB stated that the Concession area applied for by the Company creates no conflicts where national interests are considered and is designated as an ANI for minerals.

In the Company’s opinion, the announcement was a positive turnaround from the position taken by the CAB in October 2014 and it also looked to the future, directing the Company towards working with communities that could be affected by the development of a mining project, including reindeer herders and Sami villages.  This is work that the Company has already begun, with regular interactions and meetings with key stakeholders in and around Jokkmokk over the last six months, including a first meeting between the new management team and representatives of the Sami villages in June 2015.


‘Super’ High Grade Concentrate

On 4 June 2015 the Company announced outstanding testwork results on iron ore samples from Kallak North.  The Board had decided that with the funds raised in March 2015 it would commission further investigation of Kallak North ore, to demonstrate the quality of the orebody, despite the delay in being granted an Exploitation Concession, and in the knowledge that its technical consultants believed it could produce a ‘super’ high grade concentrate.  As expected by the Company, the final report showed, a ‘super’ high grade magnetite concentrate, with over 71 per cent. iron content and very low levels of deleterious elements (silica, alumina, phosphorous and sulphur) and a ‘bonus’ high grade hematite concentrate with over 68 per cent. iron content providing additional upside. 

Beowulf’s understanding of the quality of the orebody and the high grade products it can produce are critical to identifying appropriate investors and partners, who understand the fundamental value of Kallak North, the future value of Kallak South, together with the full exploration potential of both projects.  In addition, Kallak significantly benefits from its location, with proximate access to power and transport infrastructure, and positioning in a low sovereign risk jurisdiction, Sweden, a country with a long mining history, developed knowledge, skills and innovation capability.


Exploration Portfolio

The Company has rationalised its exploration portfolio in 2015, reducing the total area held, while maintaining those licence areas which demonstrate the greatest potential.  This has cut running costs, focused our efforts on ground that we believe demands investment and that we can add value to. 

Exploration has for the most part taken a backseat, while limited cash resources have been directed at advancing Kallak North.  However, we are in the process of completing a desktop review of the historical information on our exploration projects, which will assist in the design of future exploration plans and capital allocation. We continue to seek a replacement Chief Operating Officer, with interim support being provided by technical consultants, and look beyond our existing exploration portfolio for acquisition opportunities.

Financials

•    Loss before and after taxation attributable to the owners of the parent of £330,276 (2014: loss of £1,317,313) and basic/diluted loss per share of 0.09p (2014: loss of 0.47p). The main reasons for the lower loss in the period were lower corporate overheads especially directors’ remuneration and professional fees, and nil losses on derivative financial assets following the accelerated settlement of equity swap arrangements in January 2015.

•    £172,955 in cash held at the period end.

•    £650,000 (gross) raised in July 2015 by the issue of approximately 52 million new ordinary shares.


Corporate

•    The Board’s Salary Sacrifice ended 31 May 2015 and ordinary shares were issued on 9 June 2015 in respect of the cash amount sacrificed between 1 October 2014 and 31 May 2015, totaling £45,798.

•    Dr. Jan-Ola Larsson retired 12 June 2015.

•    Beaufort Securities Limited were appointed as the Company's Joint Broker alongside Cantor Fitzgerald Europe on 18 June 2015.

•    The Company’s AGM was held on 29 June 2015.  All of the resolutions put forward at the meeting, as set out in the Notice of AGM, were unanimously approved by shareholders. 
The Board received the full support of the Company’s largest shareholder.

•    On 17 July 2015 the Company granted options over a total of 17 million ordinary shares to Mr. Budge and Mr. Metcalf.

•    The total number of ordinary shares in circulation at the date of this announcement is 429,079,256 ordinary shares of £0.01 each, with each share carrying the right to one vote. The Company does not hold any ordinary shares in treasury.


Enquiries:

Beowulf Mining plc    
Kurt Budge, Chief Executive Officer    Tel: +44 (0) 20 3771 6993
Cantor Fitzgerald Europe
(Nominated Advisor & Joint Broker)    
Stewart Dickson / Jeremy Stephenson / Phil Davies / Carrie Drummond    Tel: +44 (0) 20 7894 7000
Beaufort Securities Limited
(Joint Broker)    
Jon Belliss    Tel: +44 (0) 20 7382 8300
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.

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