Endomines AB Q1 2021 Business Review Preparation underway for Restart of the Friday Mine and Mill

The full report (PDF)Press release (PDF)

Endomines AB, Stock Exchange Release 20 May 2021 at 08:30 CEST

Jan-Mar 2021 (Jan-Mar 2020)

Operational highlights

  • A Director of Operations has been recruited to oversee and lead the development of the company’s operations. At Friday, a General Manager was hired to focus on the onsite re-start and lead the operation into a steady state.
  • Technical challenges at the Orogrande Processing Facility have been resolved and the summer start-up program is on track.
  • During care and maintenance, we successfully completed the dewatering at Friday mine that will allow stope production to start in Q2 2021.
  • Preparation for mine deepening and start-up of Pampalo mine production is ongoing.
  • The Pampalo mine contractor mobilized to the site at the end of the quarter and started the work on extending the decline.
  • No injuries reported in the first quarter of 2021, LTIFR 0 (0)

Financial highlights

  • Total revenue was 0.1 MSEK (3.0)
  • EBITDA was -14.5 MSEK (-27.8)
  • Total cash flow was 56.4 MSEK (-14.5)
  • Earnings per share was -0.18 SEK (-0.41)

Significant subsequent events

  • On May 5, 2021 Endomines announced the Nomination Committee’s proposal for new board members. The Nomination Committee proposes that the Board of Directors consists of five members. Ingmar Haga and Jeremy Read are proposed to be re-elected, and Eeva Ruokonen, Markus Ekberg and Jukka-Pekka Joensuu are proposed to be elected as new directors of the Company for the term of office ending at the end of the Annual General Meeting of 2022.
  • On May 8, 2021 Endomines announced that it has signed a comprehensive financing package with LDA Capital for an aggregated amount of EUR 14 million and issues 14 million Warrants, subject to AGM approval.

Production update and outlook for 2021:
Endomines estimates that stoping at the Friday mine will commence by the end of Q2 2021 and that the Friday plant commissioning will start at the beginning of Q3 2021. The mill is expected to reach full production during the fourth quarter 2021. The short-term production guidance for the operations is between 3,000 - 4,000oz by year end, including the development ore from Pampalo mine by the end of the Q4 2021.

Key figures (Consolidated) Jan – Mar
MSEK if not stated otherwise 2021 2020 +/-
Total revenue 0.1 3.0 -2.9
Cost -14.6 -30.8 16.2
EBITDA -14.5 -27.8 13.3
Depreciation and write-downs -4.1 -1.4 -2.7
EBIT -18.6 -29.2 10.6
Net result for the period -40.4 -44.3 3.9
Earnings per share (SEK) -0.18 -0.41 0.23
Cash flow from operating activities -63.0 -30.5 -32.5
Investments -1.8 -5.2 3.4
Financing 121.2 21.2 100.0
Liquid assets at the end of the period 68.0 1.3 66.7
Personnel at the end of the period 30 43 -13
LTIFR 0 0 0

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.

Interim CEO Rauno Pitkänen: “2021 has seen Endomines start a new chapter in its drive from being a junior gold miner in search of new gold deposits, to a tier two gold producer with the latest acquisition of our US Grant and Kearsarge mine development projects and the restart of the Friday underground mine in Idaho and the Pampalo underground mine in Finland.

To implement this change we have restructured our management resources to be Site Centric to ensure a successful implementation of our aggressive drive of bringing the Idaho operation into production this summer.  We have also started the deepening of the Pampalo-mine by extending the decline, and we are very enthusiastic about being able to bring our operations in Finland back into production.

To this effect we have recruited Vern Langdale as our Director of Operations to oversee the developments at Friday and Pampalo. To strengthen the Friday operations team, we have also hired a General Manager to coordinate the onsite re-start and lead the operation into a steady state as well as a Mine Manager to drive the mine development and production. The main focus will be to ensure that we reach full potential regarding ore recovery while minimising ore dilution within our high grade but narrow vein ore bodies. Together the new hires bring in over 90 years of combined onsite operational experience which will enhance our already accomplished Friday onsite team. We are very confident of the new teams at both our operations and are looking forward to return back into production mode in the near future.”

For further information, please contact:

Rauno Pitkänen, Interim CEO, +358 40 595 4412, rauno.pitkanen@endomines.com
Marcus Ahlström, Deputy CEO and CFO, +358 50 544 68 14, marcus.ahlstrom@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 08:30 CEST on 20 May 2021.

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).