Distribution of company announcements to the professional platforms, finance portals and syndication of important corporate news to a wide variety of news aggregators and financial news systems.
* Result after financial items -8,392 TSEK (-3,388) * Investments have been 47,221 TSEK (46,052)
First six month
* Result after financial items -12,537 TSEK (-5,718) * Investments have been 54,582 TSEK (57,698)
Key ratio Jan-June Jan-June Full year 2008 2007 2007 Profit/loss after financial items -12 537 -5 718 -10 861 Equity/Debt ratio 83,4% 95,6% 96,5% Total Assets 292 266 273 221 265 516 Equity 243 742 261 221 256 224 Number of yearly employee at the end of period 47 12 15 Equity per share before dilution 4,04 4,46 4,24 Equity per share after dilution 3,96 4,46 4,24 P/L per share before dilution -0,21 -0,10 -0,18 P/L per share after dilution -0,20 -0,10 -0,18 Number of shares before dilution at the end of period, thousands 60 401 58 630 60 401 Number of shares after dilution at the end of period, thousands 61 531 58 630 60 401
P/L of fiscal period The most important goal of an exploration company that is focused on becoming a producer is to transform funds raised through financing into increased ore reserves and mineral resources, and to develop the projects technically and economically. During the fiscal period the company has continued extensive exploration on several objects. The company capitalizes expenses on mature projects, and due to this the P/L reported depends both on the total expenditures and the relative distribution between mature and early projects. The Company will from production of gold, at some of its operations, generate cash before the end of this year.
For information: Karl-Åke Johansson, CEO Tel: +46 950 275 01, +46 70 625 22 57 E-mail: karl-ake.johansson@lgold.se
Tomas Björklund, Director Tel: +46 70 662 35 35 E-mail: tomas.bjorklund@lgold.se
Significant events
* The Company made an agreement with the receiver for ScanMining Oy to acquire the Pahtavaara Gold Mine in Finnish Lapland. The agreement states that the Company, at a price of 3.1 Million Euros, acquires all of ScanMinings assets in Finland, including the mine, the process plant, claims and concessions.
* A bedrock chip sampling program in the area of Tjålmträsk showed very interesting elevations in gold grades. The following core drilling discovered visible gold. Tjålmträsk gold exploration project is situated on the Gold Line in Västerbotten, around 5 km south of Sorsele. The project was started a few years ago after the discovery of gold mineralized boulders in the area, of which one had an exceptional value of 350 g/t Au and several boulders with grades of 1 - 31 g/t.
* A gold mineralized zone with a grade of 11 g Au/ton over 6 meters was discovered during drilling at Gubbträsk. Drilling was initiated after comprehensive and systematic exploration work, with bedrock chip and bottom till sampling, geophysical surveys, trenching and core drilling.
* The Company has presented a feasibility study for the Fäboliden gold project, addressing the construction and operation of a mine with a processing plant. The study is based on a conservative evaluation of the gold grades and tonnage based on an extensive core drilling program. The feasibility study indicates that production cost is equivalent to approximately 43 - 60% of the current gold price.
* A lead-silver mineralisation has been encountered in the bedrock at Lagbäcken, 4 km south-east of Gubbträsk, after completion of a drilling program. This mineralization is most probably the source rock for high grade lead-silver mineralized boulders, which were reported in August 2007.
* Mr. Kjell Larsson was recruited as new Senior Vice President. Mr. Larsson has many years of experience from senior positions in Swedish and International mining operations, among others within Lundin Mining, Boliden group, Inco Ltd and LKAB.
* The Supreme Environmental Court (Miljööverdomstolen) granted a go ahead decision regarding the permission to construct and operate a mine and process facility at Fäboliden.
* The Annual General Meeting and Extraordinary General Meeting of Lappland Goldminers AB, Lycksele on May 30, 2008. The Income Statement and Balance Sheet, as well as treating the net loss for the fiscal period according to the proposal of the Board of Directors and as recommended by the company's Auditor, were adopted at the Annual General Meeting. The members of the Board of Directors and the Managing Director were also discharged from liability for fiscal year 2007. The ordinary members of the Board of Directors, Torsten Börjemalm, Tomas Björklund, Leif Carlson, Ulf Ericsson and Tony Harwood were re-elected, and Svante Lundbrink was elected as a new Board Member. Jan-Åke Unée was re-elected as an alternate Board Member. Torsten Börjemalm was re-elected as the Chairman of the Board. Compensation to the Board of Directors in the amount of SEK 350,000 was approved. The Chairman shall receive SEK 100,000 and the other members SEK 50,000 each. Bruno Holmqvist were re-elected as auditor. The Board of Directors was authorized to, on one or several occasions before the next Annual General Meeting, issue a maximum of 10 million new shares, and to decide on a waiver of shareholders' rights of priority. The Extraordinary General Meeting resolved an option program for Kjell Larsson, Senior Vice President, including a maximum of 175,000 stock options. Each stock option entitles the holder to acquire a new share not later than 30 December, 2012. In order to secure the Company's undertakings to deliver shares and pay social security fees it was resolved to issue 235,000 warrants with corresponding terms and conditions.
* Gold is concentrated from low-grade material at the Pahtavaara gold mine - Finland. On June 4, beneficiation tests started on low-grade material. Preliminary results indicate a head gold grade of 0.4 to 1.2 g/ton. The beneficiation tests are carried out with low-grade material which has been deposited and previously classified as waste rock. Evaluation of the preliminary results, carried out during 7 working days, between 4 and 12 of June, showed that around 6 kg of gold had been produced. During the 17 days test period in June, 17 kg of gold was produced.
* The Company ceremonially broke ground at the Company's flagship Fäboliden Gold Project that is planned to become one of Europe's largest gold mines.
Events after the end of the reporting period
* The first assessment of mineral resources for Haveri Gold project in southern Finland, in compliance with NI 43-101 was presented. The Company has, together with independent consultants, analyzed and compiled the substantial amount of geological information present. The first assessment of the project's mineral resource in compliance with the Canadian NI 43-101 consisting of 6.9 million tonnes of measured and indicated mineral resources with an average grade of 1.37 g/t Au equivalent to 308,663 troy ounces of Au, for those parts of the project included in this study. The mineral resource is 24.7 Mtonne with 0.89 g/t Au at a cut off at 0.5 g/t Au, equivalent to 710,238 troy ounces of Au.
* Test run generated profits at the Pahtavaara processing plant in Finnish Lapland. After routinely replacing of wear parts in the mill, production resumed on July 15. During August, the operation has gradually increased up to a continuous three shifts, and is expected to produce approx. 25 Kg (800 oz) of gold per month. The production was based on material that previously had been classified as waste rock. The test run indicates that a relatively high percentage of previously mined waste rock holds gold grades at a level that makes them profitable when mined at a low cost. The Company estimates that the plant can be operated at full capacity for at least two years using exclusively such material. The cost of processing previously mined material is low, and the profits for processing this material alone is estimated at approx. SEK 2 million/month before depreciation and interest.
* The Company has from the receiver in bankruptcy for Scan Mining AB and its subsidiaries Blaikengruvan AB, acquired the processing plant and the mines at Blaiken for SEK 40 million. The acquisition will be paid in four segments for a period of three years. The Company calculates that the operations will resume during autumn 2008, and that the entire purchase sum will be earned back during 2009. Initially, the operation will focus on mining of the Ersmarksberget gold deposit. The acquisition was financed through a directed new share issue of SEK 26 million to a group of institutions.
The Interim Report for January to June 2008 has not been subject to special examination by the Company's auditors. Income statement - Group SEK (,000) 3 month 3 month 6 month 6 month Full April-June April-June Jan-June Jan-June year 2008 2007 2007 2008 2007 Income Changes in inventory 1 261 0 1 261 0 0 Capitalized work 1 072 481 1 953 1 637 3 671 Change in value of biological assets 0 0 0 0 5 752 2 333 481 3 214 1 637 9 423
Taxes 0 0 0 0 0 0 0 0 0 Net Profit/Loss for -10 fiscal period -8 392 -3 388 -12 537 -5 718 861 0 0 0 0 Average number of shares before dilution, 57 thousand 60 401 54 342 60 401 54 342 731 Average number of shares after dilution, 57 thousand 61 371 54 342 61 350 54 342 731 P/L per share before dilution -0,14 -0,03 -0,21 -0,11 -0,19 P/L per share after dilution -0,14 -0,03 -0,20 -0,11 -0,19
Balance Sheet - Group SEK (,000) June 30 June 30 Dec 31 2008 2007 2007 Assets Fixed assets Intangible fixed assets 219 376 172 395 200 322 Tangible fixed assets 62 183 21 063 22 562 Financial fixed assets 3 028 1 567 3 028 284 587 195 025 225 912 Current assets Inventory 1 274 0 0 Other receivables 5 997 4 171 2 702 Investments , cash and bank balances 408 74 025 36 902 Total Current assets 7 679 78 196 39 604
Total Assets 292 266 273 221 265 516
Equity and Liabilities Equity 243 742 261 221 256 224 Allocations 4 347 0 0 Long-term liabilities 29 938 2 000 2 000 Short-term liabilities 14 240 10 000 7 291 Total Equity and Liabilities 292 266 273 221 265 516 of which interest-bearing 29 473 0 0
Changes in Equity - Group SEK (,000) June 30 June 30 Full year 2008 2007 2007 Equity at the beginning of period 256 224 139 259 139 259 New issue 0 132 777 132 777 Issue cost 0 -5 632 -5 963 Currency effects/acquired equity 54 535 1 012 P/L of fiscal period -12 537 -5 718 -10 861 Equity at the end of period 243 742 261 221 256 224
Cash Flow Analysis - Group SEK (,000) Jan-June Jan-June Full year 2008 2007 2007 Cash flow from operating activities before changes in working capital -12 283 -5 540 -9 324 Changes in working capital 898 -6 789 -13 017 Cash flow from operating activities -11 385 -12 329 -22 341 0 0 Cash flow from investing activities -54 582 -57 698 -84 478 Cash flow from financing activities 29 473 94 368 94 037 Changes in liquid assets -36 494 24 341 -12 782
Liquid assets at the beginning of period 36 902 49 684 49 684 Liquid assets at the end of period 408 74 025 36 902 Unused line of credit 3 488 5 000 5 000 Disposable cash at the end of period 3 896 79 025 41 902
Personnel/consultants The Company has 47 (last year 12) employees. In addition to this, the Company engages consultants and contractors for various projects on continuing basis. Altogether the Company engages the equivalent of 75 full time employees.
Reporting dates Interim report January - September 2008 November 28, 2008 Notice of year-end statement 2008 February 27, 2009
Accounting principles The accountings has been prepared according to (ÅRL- Annual Accounts Act), RFR 2.1 "Reporting for legal entities", International Financial Reporting Standards (IFRS) and interpretations by International Financial Reporting Interpretations Committee (IFRIC), as adopted by EU, and according to RFR 1.1 "Complementary reporting principles for groups". The parent company also applies to RFR 2.1 "Reporting for legal entities" and Årsredovisningslagen (ÅRL - Annual Accounts Act).
This report has been prepared in compliance with IAS 34 - Interim Financial Reporting. Same accounting principles have been applied as in the issued Annual Report for 2007. For detailed information regarding accounting principles, refer to Annual Report 2007.
The annual report and the group report have been approved for issue by the Board on April 11, 2008. The group Income statements and balance sheet and the parent company income statements and balance was adopted at the Annual General Meeting on May 30, 2008.
