REG - Beowulf Mining PLC - Unaudited Preliminary Financial Results
28/02/2023 07:00
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RNS Number : 2159R Beowulf Mining PLC 28 February 2023
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28 February 2023
Beowulf Mining plc
("Beowulf" or the "Company")
Unaudited Preliminary Financial Results for the year ended 31 December 2022
Beowulf (AIM: BEM; Spotlight: BEO), the mineral exploration and development
company, announces its unaudited preliminary financial results for the year
ended 31 December 2022.
Overview of Activities in the Year
Sweden
· After the award of the Exploitation Concession for Kallak North
in March 2022, the Company continued conversations with engineering
consultants, to support the completion of a Scoping Study and roadmap to
Pre-feasibility, infrastructure operators (rail and power), technical experts,
potential customers, and strategic partners.
· On 13 May 2022, Beowulf's Chief Executive Officer ("CEO"), Kurt
Budge, provided a brief update on the future development of Kallak at the
Swedish Mining Innovation and Research Day in Luleå.
· On 13 June 2022, Beowulf announced the appointment of Ulla
Sandborgh as CEO of Jokkmokk Iron.
· On 16 November 2022, Jokkmokk Iron provided a progress update for
workstreams associated with Kallak, the Scoping Study and Environmental Permit
application.
Finland
· During the period, Grafintec Oy ("Grafintec"), the Company's
wholly-owned subsidiary operating in Finland, started exploration for more
natural flake graphite, contracting the Geological Survey of Finland ("GTK")
to carry out an electromagnetic ("EM") survey over the Rääpysjärvi
exploration permit.
· Grafintec also entered into a Memorandum of Understanding ("MoU")
with GTK, providing Grafintec and GTK with a framework and platform to promote
and foster cooperation in the fields of circular economy, mineral processing
and exploration of graphite as pertaining to anode materials for the
lithium-ion battery market and other markets from different raw material
sources.
· On 26 September 2022, Grafintec entered a partnership with
Qingdao Hensen Graphite Ltd ("Hensen"), a company that has been operating in
the graphite industry for 37 years and has been producing graphite-based anode
materials since 2003. This partnership will provide an integrated solution for
producing graphite-based anode materials in Finland.
· On 7 October 2022, the Company announced the results from the EM
survey and assays for Grafintec's Rääpysjärvi flake graphite prospect. The
survey indicated extensive EM anomalies, significant potential for a larger
tonnage of high-grade graphite mineralisation than that defined at Aitolampi
and for localised very high-grade mineralization.
· On 22 December 2022, the Company provided a progress update for
Grafintec, including the results and assays of a trenching programme for
Rääpysjärvi.
Kosovo
· On 22 August 2022, the Company announced the discovery of a large
Polymetallic Epithermal System (copper, gold and lead-zinc) at Majdan Peak
("MP"), part of Vardar Minerals' ("Vardar") Mitrovica licence in Kosovo, with
drilling results both supporting the potential for epithermal mineralisation
of economic grades to be present and for comparisons to be drawn with the
Chelopech copper-gold deposit in Bulgaria.
· On 8 September 2022, new exploration targets were announced after
additional analysis of drilling and exploration activities were conducted at
MP.
· On 21 November 2022, Beowulf began drilling at MP with a short
campaign of five diamond holes.
· On 14 December 2022, the Company announced new results from
detailed geological mapping over the Red Lead target, located within the
Mitrovica Licence.
· On 16 December 2022, the Company announced an update regarding
two new licences added to the Vardar's exploration profile.
Corporate
· On 4 July 2022, the Company announced a loan financing from a
Nordic Institutional Investor of SEK 22 million (approximately £1.76 million)
before expenses. The funds were allocated to advance the Company's projects
and achieve key milestones, with the focus being on Kallak.
· On 8 July 2022, the Board approved the implementation of a new
Long-Term Incentive Plan ("LTIP") available to eligible employees of the
Company.
· On 7 November 2022, Johan Röstin was appointed as Non-Executive
Chairman of the Board.
· On 20 December 2022, Beowulf announced its intention to conduct a
preferential rights issue of SDRs in Sweden and a UK retail offer of ordinary
shares and partially secured capital raise up to approximately SEK 112 million
(approximately £8.8 million) to progress at pace the development of Kallak.
Post Period
· Grafintec announced on 9 January 2023 that it had awarded a
Pre-feasibility Study ("PFS") contract to the UK based RB Plant Construction
Ltd. ("RB Plant") to assess the technical, economic, statutory, regulatory and
commercial options for a natural flake graphite micronisation, spheronisation,
purification, and coating plant in Finland, as part of its plan to establish a
Graphite Anode Materials Plant ("GAMP").
· On 24 January 2023, the Company announced positive economic
results from the Scoping Study for Kallak North, part of the Kallak Iron Ore
Project ("KIOP") being developed by the Company's 100 per cent owned
subsidiary Jokkmokk Iron Mines AB ("Jokkmokk Iron"), which boost the Company's
plans to begin producing high-grade iron concentrate in 2026.
· On 25 January 2023, Beowulf launched a preferential rights issue
of SDRs in Sweden and a UK retail offer of ordinary shares - Partially secured
capital raise up to approximately SEK 115 million (approximately £9.1
million) - Funding to progress at pace the development of Kallak. The start of
the subscription period was announced on 9 February 2023.
· On 21 February 2023, Grafintec announced that it had signed a
site reservation agreement with the municipality of Korsholm, securing Plot 1,
Block 3017 in the GigaVaasa area, for the establishment of GAMP. The
agreement was signed on 13 February 2023 and the reservation is valid for an
initial six-month period from signing, with the option to extend.
· On 22 February 2023, Jokkmokk Iron provided a progress report for
Kallak.
Kurt Budge, Chief Executive Officer of Beowulf, commented:
"Beowulf has transformed itself in the last year, with the award of
Exploitation Concession for the Kallak North Iron Ore Project and,
post-period, positive economics results from the Kallak North 'Only' Base
Case.
"The preliminary economic assessment for Kallak North is only part of the
bigger Kallak story, and we have many levers to increase value, which will be
investigated as we proceed with Pre-feasibility. These include resource
expansion, a longer life mining operation, increased production capacity, and
higher proportion of high-grade concentrate sales to decarbonising steelmakers
in the Nordics and Europe, of which there are many.
"During the year, we strengthened the leadership team in Sweden with
competence and experience, with firstly the appointment of Ulla Sandborgh as
CEO Jokkmokk Iron and then Johan Röstin as Chairman of Beowulf.
"We built new partnerships in Finland, firstly collaborating with Hensen, an
established graphite and anode materials company, and then, post period,
signing a new site agreement with the municipality of Korsholm for
establishing an anode materials production facility in the GigaVaasa area.
"Grafintec continued its efforts to expand its natural flake graphite resource
inventory, with really promising exploration findings for the Rääpysjärvi
prospect, which in the future, could potentially add to the Company's
resources already defined at Aitolampi, offering sustainable and secure
primary raw materials supply to a Finnish anode materials value chain.
"With Vardar, we had a year of tremendous exploration success in Kosovo,
discovering a large polymetallic epithermal system, drawing close comparisons
between our findings at Mitrovica and known deposits and mines in operation,
with the same geology and geometry, adding new gold and base metal targets,
priorities for the next drilling programme, and new highly prospective
exploration licences surrounding the existing Stan Terg mine.
"As momentum continues to build with Kallak, Beowulf is considering its
options for the further development of Vardar. With the success achieved
last year, the Company sees the realistic possibility of spinning out Vardar
as a standalone listed company.
"With Jokkmokk Iron and Grafintec, we have distinct businesses positioned to
benefit from the Green Transition and the demand for sustainable and secure
supply of primary raw materials. The status of our iron ore and natural flake
graphite resources can only be enhanced, as geopolitical uncertainties remain,
and Europe seeks to be sustainable and self-sufficient.
"With the goal of bringing Kallak into production in 2026 and opportunities
with Grafintec to get into anode materials production, we are excited about
what we can deliver in 2023 and the progress we can make towards achieving our
goals."
Financial
· The consolidated loss increased in the year before tax from
£1,485,611 in 2021 to £2,041,452 in 2022. This increase is primarily due to
finance costs in relation to the bridging loan of £304,529 and share based
payment expenses of £240,537.
· The underlying administration expenses of £1,566,055 were in
line with the previous year of £1,503,049.
· Consolidated basic and diluted loss per share for the 12 months
ended 31 December 2022 was 0.23 pence (2021: loss of 0.16 pence).
· The Company received loan financing from a Nordic Institutional
Investor of SEK 22 million, which generated £1,554,381 of net proceeds to
fund working capital.
· £1,776,556 in cash was held at the year-end (2021: £3,336,134).
· Exploration assets increased to £13,002,465 at 31 December 2022
compared to £11,235,656 at 31 December 2021.
· The translation reserve losses attributable to the owners of the
parent increased from £1,216,985 at 31 December 2021 to £1,289,415 at 31
December 2022. Much of the Company's exploration costs are in Swedish Krona
which has weakened against the pound since 31 December 2021.
· At 31 December 2022, there were 632,863,876 Swedish Depository
Receipts representing 76.09 per cent of the issued share capital of the
Company. The remaining issued share capital of the Company is held in the UK.
Operational
Sweden
· Further to the award of the Exploitation Concession for Kallak
North in March 2022, on 27 April 2022, the Company announced that discussions
were underway with engineering consultants, who will support the completion of
a Scoping Study and roadmap to Pre-feasibility, infrastructure operators (rail
and power), technical experts, regarding the Kallak resource and ore
processing, potential customers, and strategic partners.
· On 13 May 2022, the Company announced that Kurt Budge, CEO, had
visited Sweden and provided a brief update on the future development of Kallak
at the Swedish Mining Innovation and Research Day in Luleå. During his
week-long visit to Sweden, he met with legal advisers to discuss environmental
permitting and its place in the overall development timeline for Kallak and
engaged in discussions with authorities and potential partners in the future
development of Kallak.
· On 10 June 2022, the Company shared that it had learnt that
Jåhkågasska tjiellde, a Sami village, through its lawyers, had issued a
press release announcing that it will take legal action against the Government
of Sweden following the Government's decision, on 22 March 2022, to award an
Exploitation Concession for Gállok / Kallak.
· On 13 June 2022, Beowulf announced the appointment of Ulla
Sandborgh as CEO of Jokkmokk Iron, Beowulf's wholly-owned Swedish subsidiary
and the developer of the Kallak Project.
Ulla has held senior positions in private enterprise and public institutions,
in sectors including infrastructure, electricity and water. Her most recent
role was a Director General in the Ministry of Enterprise of The Government of
Sweden, in which role she was responsible for issues affecting the limestone
and cement industries and accountable for the development of a strategy to
promote the efficient and sustainable usage of water. Ulla has extensive
experience in managing permitting processes and, as part of this, engaging
with stakeholders, to ensure interests are safeguarded, and benefits shared.
· On 16 November 2022, Jokkmokk Iron provided a progress update for
workstreams associated with Kallak, the Scoping Study and Environmental Permit
application.
o The Scoping Study includes analysis of options and trade-offs for
different aspects of the project, for delivering on 'Net Zero' ambitions and
developing a sustainable mine.
o In support of the Scoping Study, the Company engaged Vulcan Technologies
Pty Ltd ("VulcanTech"), an Australian company, to complete a Marketing Study
to consider traditional and non-traditional market opportunities that might be
served by Kallak concentrates. VulcanTech specialises in the modelling of iron
and steel making processes.
o Workstreams associated with the Environmental Permit application are
progressing, including updating investigations regarding nature values, water
management and options for transporting production from the mine.
Finland
· On 4 July 2022, the Company provided an update on Grafintec. The
Company had been exploring for more natural flake graphite, contracting GTK to
do an EM survey over the Rääpysjärvi exploration permit, which is located
in the municipality of Tuusniemi in Eastern Finland, eight kilometres
north-northwest of the Aitolampi graphite project.
Also, Grafintec entered into a MoU with GTK, which provides a framework and a
platform to promote and foster cooperation in the fields of circular economy,
mineral processing and exploration of graphite as pertaining to anode
materials for the lithium-ion battery market and other markets from different
raw material sources (Primary, Recycled and Circular) including beneficiation
testing and mineralogical research.
· On 25 August 2022, Beowulf notified that the MoU signed between
Grafintec and Epsilon Advanced Materials Private Limited had been terminated.
· On 26 September 2022, Grafintec signed a new MoU with Hensen,
which includes an agreed framework and key terms on which both companies are
collaborating with regards to establishing an anode materials hub in Finland.
· On 7 October 2022, the Company announced the results from the EM
survey and assays for Grafintec's Rääpysjärvi flake graphite prospect. The
EM survey indicated extensive EM anomalies, significant potential for a larger
tonnage of high-grade graphite mineralisation than that defined at Aitolampi
and for localised very high-grade mineralisation. Highlights included:
o 13 highly conductive EM zones were identified, with isolated zones
extending for up to 850 metres ("m") strike length and 250m width.
o Analysis of eight grab samples from outcrops in the area range from 0.52
to >50 per cent total graphitic carbon ("TGC"). The sample assaying more
than 50 per cent TGC (limit of the analysing methodology) was taken from a
historic graphite quarry situated close to the north-western limit of one of
the largest EM conductive zones.
o Six holes drilled in the 1980s have also been re-sampled and re-assayed
for TGC. Two of the drill holes intersected significant graphite
mineralisation:
§ TN/SM-2: 19.29m at 5.62 per cent TGC (from 177.11m); and
§ TN/SM-3: 9.84m at 6.70 per cent TGC (from 226.16m) and 35.55m at 4.98 per
cent TGC (from 266.45m).
o Previous metallurgical testwork on a 10kg composite grab sample has
produced a concentrate grade of 97.4 per cent TGC.
o The encouraging exploration data set indicates significant potential for
natural flake graphite mineralisation suitable for graphite-based anodes
across Rääpysjärvi.
In the release, the Company reaffirmed that the development of downstream
capabilities is a key part of Grafintec's strategy and to support a
sustainable graphite anode value chain in Finland, Grafintec is focused on
expanding its resource footprint and increasing its raw materials' inventory,
primary and recycled, feeding downstream processing, leveraging renewable
power, targeting net zero CO(2 )emissions ("Net Zero") across the supply
chain.
While projects in Finland are still in development, the Company has other
initiatives to secure raw materials supply, natural flake graphite and
recycled graphite, to feed downstream processing. In May 2022, Grafintec
signed an MoU with Dominik Georg Luh Technografit GmbH ("Technografit"),
establishing the basis for a commercial partnership for securing sustainable
supply of natural flake graphite for Grafintec's planned graphite anode
materials plant; samples are being tested by Hensen and processed to anode
material. Also, the Company has testwork programmes on recycled graphite
containing waste to assess whether it can be processed to suitable feedstock
for anode materials production.
· On 22 December 2022, the Company provided an progress update for
Grafintec, including the results and assays of a trenching programme for
Rääpysjärvi. Samples were taken from four trenches in different locations
within the identified EM conductive Zone 1, with assays confirming the
existence of significant flake graphite mineralisation grade and intersected
width.
Flake graphite mineralisation discovered in all four trenches sampled,
including:
o RAA-TR1-22: 10.6 m at 4.33 per cent total graphitic carbon ("TGC") and
3.8m at 5.77 per cent TGC;
o RAA-TR2-22: 9.96 per cent TGC from grab sample;
o RAA-TR3-22: 5.8m at 7.25 per cent TGC and 7.1 m at 7.43 per cent TGC;
and
o RAA-TR4-22: 1.0m at 26.00 per cent TGC.
Rääpysjärvi EM conductive area covers 1.1 square kilometres, including 13
highly conductive EM zones which adds to the potential for a new major flake
graphite discovery.
Kosovo
· On 4 July 2022, the Company shared that the latest drilling
programme in Kosovo had finished. The focus of drilling had been the Majdan
Peak gold target, part of the Mitrovica licence.
· On 22 August 2022, the Company announced the discovery of a large
Polymetallic Epithermal System (copper, gold and lead-zinc) at MP, part of
Vardar's Mitrovica licence, with drilling results both supporting the
potential for epithermal mineralisation of economic grades to be present and
for comparisons to be drawn with the Chelopech copper-gold deposit in
Bulgaria.
· The exploration programme consisted of 11 widely spaced diamond
drillholes covering an area 1,400m by 700m. All drillholes intersected
abundant sulphides, intense alteration, and multiple generations of veining
which are all factors indicative of a large polymetallic epithermal system.
Significant gold-copper-silver, lead-zinc-silver and gold intersections
include:
o Drillhole MP006: 10.8m at 0.48 grammes per tonne ("g/t") gold ("Au"), 0.1
per cent copper ("Cu") and 18 g/t silver ("Ag"), including 3.2m at 1.1 g/t Au,
0.2 per cent Cu and 50 g/t Ag;
o Drillhole MP006: 6.8m at 4.1 per cent lead ("Pb"), 0.6 per cent zinc
("Zn") and 15 g/t Ag; and
o Drillhole MP013: 16.1m at 0.21 g/t Au.
· Following this, on 8 September 2022, the Company announced
additional analysis of drilling and exploration activities in and around the
Majdan Peak South ("MPS") area. This analysis generated additional exploration
targets effectively increasing the significant district potential. The
additional targets include Gold Ridge and Red Lead.
· The main objective of exploration is to discover an economic
deposit of base and precious metals, and recent drilling has shown this
potential. Drilling at MPS intercepted several noteworthy precious metals
intersections, including:
o Drillhole MP002: 8.8 m at 0.34 g/t Au, including 0.9m at 1.52 g/t Au and
20 g/t Ag; and
o Drillhole MP003: 36.4m at 19 g/t Ag, 0.5 per cent Pb and 0.2 per cent Zn,
including:
§ 1.5m at 128 g/t Ag, 0.35 per cent Cu, 1.5 per cent Pb and 0.3 per cent Zn;
§ 1.1m at 71 g/t Ag, 0.1 per cent Cu, 0.7 per cent Pb and 0.3 per cent Zn;
§ 1.0m at 50 g/t Ag, 0.2 per cent Cu, 0.5 per cent Pb and 0.3 per cent Zn;
§ 4.8m at 44 g/t Ag and 0.7 per cent Pb; and
§ 1.1m at 46 g/t Ag, 2.7 per cent Pb and 0.6 per cent Zn.
· On 21 November 2022, Vardar began drilling into Majdan Peak with
a short campaign of five diamond holes, the main objective to discover an
economic deposit of base and precious metals.
· On 14 December 2022, the Company announced new results from
detailed geological mapping over the Red Lead target, located within the
Mitrovica Licence. The Red Lead target shares similarities observed at the
neighbouring world-class Stan Terg deposit.
The Red Lead target is defined by a two kilometres East-Northeast trending
lead-zinc-copper-gold soil sample anomaly along with:
o Mineralised trachyte bodies (with up to three per cent zinc from rock
sampling);
o Prominent induced polarisation ("IP") anomalies indicative of potential
sulphide metal sources; and
o Hydrothermal breccias and gossanous outcrops.
Detailed mapping has identified marble units along with gossans, trachyte
bodies and carbonate alteration, further highlighting the potential for
carbonate-replacement style lead-zinc-silver mineralisation.
Several outcrops of marble in the basement host rocks could provide an ideal
trap-site for metal-rich hydrothermal fluids.
This important target shares the same host rocks, trachyte heat source,
hydrothermal breccias and hydrothermal alteration pattern as the neighbouring
Stan Terg deposit which is located equidistant from the Majdan Peak
high-sulphidation epithermal target.
· On 16 December 2022, the Company announced an update regarding
two new licences added to Vardar's exploration profile.
The licences are situated in the prospective Vardar lead-zinc-silver belt in
northern Kosovo along trend from historical mining districts and cover 115
square kilometres. The new licences extend the coverage of Vardar's Mitrovica
and Shala exploration projects, both of which display abundant evidence of
active epithermal systems with associated lead-zinc-silver and
gold-silver-copper mineralisation.
The new licences include prospective carbonate host rocks along with Oligocene
magmatic rocks which provide the heat and metal source in the surrounding
lead-zinc ore districts, and the alteration and gossan outcrops have been
noted in early reconnaissance visits further demonstrating the potential for
lead-zinc-silver mineralisation in both of the licences.
Corporate
· On 8 July 2022, the Board approved the implementation of the LTIP
for senior and executive management and other eligible employees; the grant of
share awards in the form of share options at the discretion of the Company's
Remuneration Committee. The Remuneration Committee may determine the specific
vesting conditions of individual awards, including vesting period, strike
price, expiry date and any performance conditions as it determines
reasonable. Total number of options under award will not exceed 10 per cent
of the Company's issued ordinary share capital.
· On 4 July 2022, the Company agreed to loan financing from a
Nordic Institutional Investor of SEK 22 million (approximately £1.76 million)
before expenses, to be used to advance the Company's projects and achieve key
milestones, with the focus on Kallak.
· On 7 November 2022, Johan Röstin was appointed as Non-Executive
Chairman of the Board following Sven Otto Littorin's resignation.
Mr Röstin was the CEO of ferry operator ForSea for three years, 2017-2020,
and before that the CEO of Copenhagen Malmo Port AB, 2009-2017. He has
significant experience in infrastructure, logistics, capital investments and
permitting processes, and has held Board, executive and senior management
positions during his career. In his role at ForSea, Mr Röstin led the
company to create a new brand, a stronger organisation and set the company on
its sustainability journey.
· On 20 December 2022, Beowulf announced its intention to
undertake, in the first quarter of 2023, a preferential rights issue of SDRs
with a PrimaryBid retail offer of ordinary shares of 1 pence each in the
capital of the Company ("Ordinary Shares") in the UK. The SDRs represent
interests in Ordinary Shares and the preferential rights issue of SDRs will
amount to approximately SEK 85 million (approximately £6.7 million) before
deduction for transaction related costs (the "Rights Issue"). The PrimaryBid
retail offer of Ordinary Shares in the UK, will amount to a maximum of
approximately SEK 27 million (approximately £2.1 million) before deduction
for transaction related costs (the "UK Issue" and, together with the Rights
Issue, the "Capital Raise").
Post Period
· Grafintec announced, on 9 January 2023, that it had awarded a PFS
contract to RB Plant to assess the technical, economic, statutory,
regulatory and commercial options for a natural flake graphite micronisation,
spheronisation, purification, and coating plant in Finland.
The study will investigate the Best Available Technology ("BAT") with
consideration for environmental, operational and financial factors and
performance, for transforming a high-grade natural flake graphite concentrate
to graphite anode material suitable for the European Lithium-Ion Battery
("LIB") market opportunities.
The PFS is a key part of Grafintec's strategy to develop a Finnish value chain
for anode materials production, aligned with the objectives of the funding
received from Business Finland as part of the BATCircle2.0 (Finland-based
Circular Ecosystem of Battery Metals) consortium. BATCircle2.0 is a key
project in Business Finland's Smart Mobility and Batteries from Finland
programmes.
· On 24 January 2023, the Company announced positive economic
results from the Scoping Study for Kallak North, part of the Kallak Iron Ore
Project, which boost the Company's plans to begin producing high-grade iron
concentrate in 2026. The complete announcement can read at:
https://polaris.brighterir.com/public/beowulf_mining_plc/news/rns/story/x5z928x
· On 21 February 2023, Grafintec announced that it had signed a
site reservation agreement with the municipality of Korsholm, securing Plot 1,
Block 3017 in the GigaVaasa area, for the establishment of a GAMP. The
agreement was signed on 13 February 2023 and the reservation is valid for an
initial six-month period from signing, with the option to extend.
Over the coming months, Grafintec will work closely with the municipality of
Korsholm and other important stakeholders, continue with its PFS announced on
9 January 2023, and in addition parallel workstreams as part of an
Environmental Assessment Impact ("EIA") programme. Grafintec intends to
apply for a long-term site reservation for Plot 1 before the end of July 2023.
Plot 1 covers an area of approximately 47 hectares and is located immediately
to the south-southeast of the area where FREYR, the battery cell manufacturing
company, has secured land to develop industrial scale battery technology and
production.
· On 22 February 2023, Jokkmokk Iron provided a progress report for
Kallak. Since the positive economic results from the Scoping Study for the
Kallak North 'Only' Base Case, Jokkmokk Iron continues to make rapid progress
with workstreams supporting the Environmental Permit application for Kallak
North.
Ulla Sandborgh, CEO of Jokkmokk Iron, has been building the expertise within
the Jokkmokk Iron team. When the Capital Raise has been completed, plans and
budgets will be finalised that will support the application of the
Environmental Permit in Q4 2023 and the start of the PFS.
ESG
· On 27 April 2022, in its update on the plans for Kallak's
development, the Company shared that it had been reviewing workstreams and
timelines that would open up the potential for the initially proposed
timeframe of 4-5 years to be shortened through local partnerships, greater
collaboration, and efficient development, application and permitting
processes.
· On 13 May 2022, regarding Community Initiatives, the Company
announced that discussions were taking place with the responsible local agency
in Jokkmokk about conducting surveys to map the current workforce and future
workforce, school leavers and university students in the region, to determine
what initiatives need to be started to ensure sufficient locally based skilled
persons are available for work at the mine or in other businesses established
by the economic stimulus created by the mine.
The Company wants to be recognised for living its values of Respect,
Partnership and Responsibility. Our recent ESG work has identified, as
material to the Company's activities, the following main Sustainable
Development Goals and relevant actions under each goal which the Company will
be focusing on:
· Goal 6: Ensure availability and sustainable management of water
and sanitation for all
o Target 6.1 - By 2030, achieve universal and equitable access to safe and
affordable drinking water for all
o Target 6.4 - By 2030, substantially increase water-use efficiency across
all sectors and ensure sustainable withdrawals and supply of freshwater to
address water scarcity and substantially reduce the number of people suffering
from water scarcity
· Goal 8: Decent work and economic growth
o Target 8.2 - Achieve higher levels of economic productivity through
diversification, technological upgrading and innovation, including through a
focus on high-value added and labour-intensive sectors
o Target 8.4 - Improve progressively, through 2030, global resource
efficiency in consumption and production and endeavour to decouple economic
growth from environmental degradation, in accordance with the 10-year
framework of programmes on sustainable consumption and production, with
developed countries taking the lead
o Target 8.5 - By 2030, achieve full and productive employment and decent
work for all women and men, including young people and persons with
disabilities, and equal pay for work of equal value
· Goal 9: Industry, innovation and infrastructure
o Target 9.1 - Develop quality, reliable, sustainable and resilient
infrastructure, including regional and transborder infrastructure, to support
economic development and human well-being, with a focus on affordable and
equitable access for all
o Target 9.4 - By 2030, upgrade infrastructure and retrofit industries to
make them sustainable, with increased resource-use efficiency and greater
adoption of clean and environmentally sound technologies and industrial
processes, with all countries taking action in accordance with their
respective capabilities
· Goal 12: Responsible production and consumption
o Target 12.2 - By 2030, achieve the sustainable management and efficient
use of natural resources
o Target 12.5 - By 2030, substantially reduce waste generation through
prevention, reduction, recycling and reuse
o Target 12.6 - Encourage companies, especially large and transnational
companies, to adopt sustainable practices and to integrate sustainability
information into their reporting cycle
· Goal 13: Climate Action
o Target 13.2 - Integrate climate change measures into national policies,
strategies and planning
· When it comes to the development of the Company's projects and
with Kallak as the frontrunner, the above goals and our future compliance with
The Equator Principles are being factored into our thinking, design,
engineering, and planning of our operations and management systems.
The Company's ESG Policy is available on the website following the link below:
https://beowulfmining.com/about-us/esg-policy/
(https://beowulfmining.com/about-us/esg-policy/)
Kallak North Scoping Study - ESG
Jokkmokk Iron's vision for the Kallak Iron Ore Project ("KIOP") is to provide
iron concentrates to feed the burgeoning low-carbon steel industry in Sweden
and Europe. The energy transition currently underway requires a step-change in
raw material production - both primary (mining) and secondary (recycling).
Wind turbines, solar panels, electric vehicles, along with the electrical
infrastructure required to allow these low-carbon technologies to function,
are reliant on high-quality steel.
Beowulf and Jokkmokk Iron understand that developing Kallak North will come
with environmental and social challenges. The land on which the deposit sits
is used by indigenous reindeer herding communities of the Jåhkågasska
tjiellde Sámi village (sameby). The Sámi community - including the Sámi
council (Sámiráđđi) - have objections to a mining development, being
concerned that Kallak will affect reindeer herding in terms of a loss of
grazing lands, creating a barrier to free movement and other social and
environmental impacts.
As part of the Scoping Study, SRK and the Company have made a preliminary
identification of the bio-physical, socio-economic and cultural issues
potentially arising from the Project and how this may affect the reindeer
herding communities. Definition of the associated impacts will be the subject
of ongoing dialogue with potentially affected stakeholders, including the Sami
villages, as part of the updated environmental and social impact assessment
(ESIA, or miljökonsekvensbeskrivning MKB ) that is currently being planned
to update the preliminary MKB produced as part of the Kallak K nr 1
Exploitation Concession (Bearbetningskoncession) application in 2013.
At this stage of study, during early Project planning, the focus is on
avoiding potential impacts as far as practicable and starting to identify the
design and operational controls that can mitigate impacts, which cannot be
avoided.
The Scoping Study has included the following design considerations to minimise
negative environmental and social impacts:
· Assessment of alternative tailings storage facility locations to
reduce surface footprint and potential community health risks.
· Fully electric mining and concentrate transport fleet from
start-up of operations, including trolley-assisted charging. This will take
advantage of the low-intensity greenhouse gas emissions of the Swedish
national grid, dominated by hydroelectric power and wind.
· Optimisation of the pit to balance value from extracted ore with
waste rock production, not simply focussed on maximising profitability. This
has minimised the surface footprint of the planned waste rock dumps along with
post-processed tailings waste.
· Concentrate transport route planned to avoid the Laponia World
Heritage site to the north.
· Concentrate transport using battery electric heavy good's
vehicles and existing rail infrastructure.
· Abatements around the pit crest to reduce noise, dust and visual
impacts.
As part of the Pre-feasibility Study, planned to begin in Q2 2023, these
concepts will be developed further along with other innovations to maximise
the value of the mined material, such as producing construction materials as
by-products.
It is the Company's aim to operate the Kallak North mine alongside Sámi
reindeer husbandry and local landowners, and the Company is committed to
ensuring land is restored and rehabilitated on closure suitable for those that
will use it. This requires close communication and sharing of ideas, which has
been achieved for other projects across the Sápmi area of Sweden, Finland and
Norway. Jokkmokk Iron has re-initiated the stakeholder engagement process with
local Sámi communities through consultation and held meetings in Jokkmokk,
with both the Sámi communities and other local stakeholders.
Stakeholder Engagement
Recognising the historical and current opposition to the Project, the presence
of indigenous people and the risk to the permitting processes, the Company
intends to undertake close communication and sharing of ideas with key
stakeholders. Jokkmokk Iron has re-initiated the stakeholder engagement
process with local Sámi communities and held meetings in Jokkmokk with both
the Sámi communities and other local stakeholders. Since the Kallak North
Exploitation Concession was awarded, there has been one information meeting in
Jokkmokk held in December 2022, with more meetings planned before formal
consultation on the draft Environmental Permit begins. An initial meeting
with reindeer herders took place in autumn 2022, though the most impacted Sami
village abstained from attendance, and four meetings per year are planned in
the future. Meetings with authorities are ongoing.
Enquiries:
Beowulf Mining plc
Kurt Budge, Chief Executive Officer Tel: +44 (0) 20 7583 8304
SP Angel
(Nominated Adviser & Broker)
Ewan Leggat / Stuart Gledhill / Adam Cowl Tel: +44 (0) 20 3470 0470
BlytheRay
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.
About Beowulf Mining plc
Beowulf Mining plc ("Beowulf" or the "Company") is an exploration and
development company, listed on the AIM market of the London Stock Exchange and
the Spotlight Exchange in Sweden. The Company listed in Sweden in 2008 and, 31
December 2022, was 76.04 per cent owned by Swedish shareholders.
Beowulf's purpose is to be a responsible and innovative company that creates
value for our shareholders, wider society and the environment, through
sustainably producing critical raw materials needed for the transition to a
Green Economy.
The Company has an attractive portfolio of assets, including commodities such
as iron ore, graphite, base and precious metals, with activities in
exploration, the development of mines and downstream production in Sweden,
Finland and Kosovo.
In Sweden, Jokkmokk Iron, a wholly-owned subsidiary, is developing the
Company's most advanced project Kallak, from which testwork has produced a
'market leading' magnetite concentrate of 71.5 per cent iron content. In the
Kallak area, 389 million tonnes of iron mineralisation has been estimated, a
potential source of high quality iron ore for fossil-free steel making in the
Nordic region for decades to come.
In Finland, Grafintec, a wholly-owned subsidiary, is developing a natural
flake graphite inventory (defined resources at the Aitolampi project
indicate 1.275 million tonnes contained graphite). Grafintec is working
towards creating a sustainable value chain in Finland from high quality
natural flake graphite resources to anode material production, leveraging
renewable power, targeting Net Zero CO(2) emissions across the supply chain.
In Kosovo, the Company owns approximately 61 per cent of Vardar Minerals
("Vardar"), which is focused on exploration in the Tethyan Belt, a major
orogenic metallogenic province for gold and base metals. Vardar is
delivering exciting results for its Mitrovica licence which has several
exploration targets, including lead, zinc, copper and gold. It also has the
Viti licence which is showing potential for copper-gold porphyry
mineralisation.
Kallak is the foundation asset of the Company, and, with Grafintec and Vardar,
each business area displays strong prospects, presents opportunities to grow,
with near-term and longer-term value-inflection points.
Beowulf wants to be recognised for living its values of Respect, Partnership
and Responsibility. The Company's ESG Policy is available on the website
following the link below:
https://beowulfmining.com/about-us/esg-policy/
(https://beowulfmining.com/about-us/esg-policy/)
BEOWULF MINING PLC
CONDENSED CONSOLIDATED INCOME STATEMENT
FOR THE TWELVE MONTHS TO 31 DECEMBER 2022 AND THE THREE MONTHS TO 31 DECEMBER
2022
Notes (Unaudited) (Unaudited) (Unaudited) (Audited)
3 months ended 3 months ended 12 months ended 12 months ended
31 December 31 December 31 December 31 December 2021
2022 2021 2022
£
£ £ £
Continuing operations
Administrative expenses (492,731) (384,099) (1,566,055) (1,503,049)
Impairment of exploration assets 7 (36,988) - (36,988) -
Impairment of property, plant and equipment - - - (48,966)
Share based payment expense 6 (113,046) - (240,537) -
Operating loss (642,765) (384,099) (1,843,580) (1,552,015)
Finance costs 3 (158,559) (77) (304,796) (256)
Finance income 127 12 176 71
Grant income 14,579 52,385 84,797 66,589
Gain on disposal of investment 21,951 - 21,951 -
Loss before and after taxation (764,667) (331,779) (2,041,452) (1,485,611)
Loss attributable to:
Owners of the parent (723,801) (296,703) (1,948,459) (1,351,179)
Non-controlling interests (40,866) (35,076) (92,993) (134,423)
(764,667) (331,779) (2,041,452) (1,485,611)
Loss per share attributable to the owners of the parent:
Basic and diluted (pence) 4 (0.09) (0.04) (0.23) (0.16)
BEOWULF MINING PLC
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS
FOR THE TWELVE MONTHS TO 31 DECEMBER 2022 AND THE THREE MONTHS TO 31 DECEMBER
2022
(Unaudited) (Unaudited) (Unaudited) (Audited)
3 months ended 3 months ended 12 months ended 12 months ended
31 December 31 December 31 December 31 December 2021
2022 2021 2022
£
£ £ £
Loss for the year (764,667) (331,779) (2,041,452) (1,485,611)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss:
Exchange losses arising on translation of foreign operations (96,142) (319,765) (32,945) (794,368)
Total comprehensive loss (860,809) (651,544) (2,074,397) (2,279,979)
Total comprehensive income loss attributable to:
Owners of the parent (827,485) (601,942) (2,020,889) (2,110,892)
Non-controlling interests (33,324) (49,602) (53,508) (169,087)
(860,809) (651,544) (2,074,397) (2,279,979)
BEOWULF MINING PLC
CONDENSED COMPANY STATEMENT OF COMPREHENSIVE LOSS
FOR THE TWELVE MONTHS TO 31 DECEMBER 2022 AND THE THREE MONTHS TO 31 DECEMBER
2022
Notes (Unaudited) (Unaudited) (Unaudited) (Audited)
3 months ended 3 months ended 12 months ended 12 months ended
31 December 31 December 31 December 31 December 2021
2022 2021 2022
£
£ £ £
Continuing operations
Administrative expenses (191,173) (210,276) (916,909) (1,233,369)
Share based payment expense 6 (62,652) - (173,345) -
Operating loss (253,825) (210,276) (1,090,254) (1,233,369)
Finance costs 3 (158,449) - (304,529) -
Finance income 122 12 170 71
Gain on disposal of investments 21,951 - 21,951 -
Loss before and after taxation and total comprehensive loss (390,201) (210,264) (1,372,662) (1,233,298)
Loss per share attributable to the owners of the parent:
Basic and diluted (pence) 4 (0.05) (0.03) (0.17) (0.15)
BEOWULF MINING PLC
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
(Unaudited) (Audited)
As at As at
31 December 31 December 2021
2022 £
£
ASSETS Notes
Non-current assets
Intangible assets 7 13,002,465 11,235,656
Property, plant and equipment 129,715 133,428
Loans and other financial assets 5,181 5,247
Right of use asset 19,279 7,401
13,156,640 11,381,732
Current assets
Trade and other receivables 220,427 183,139
Cash and cash equivalents 1,776,556 3,336,134
1,996,983 3,519,273
TOTAL ASSETS 15,153,623 14,901,005
EQUITY
Shareholders' equity
Share capital 5 8,317,106 8,317,106
Share premium 24,689,311 24,689,311
Capital contribution reserve 46,451 46,451
Share based payment reserve 516,098 668,482
Merger reserve 137,700 137,700
Translation reserve (1,289,415) (1,216,985)
Accumulated losses (20,323,414) (18,470,675)
Total equity 12,093,837 14,171,390
Non-controlling interests 568,732 325,039
TOTAL EQUITY 12,662,569 14,496,429
LIABILITIES
Current liabilities
Trade and other payables 625,730 357,236
Grant income - 39,849
Lease liability 19,377 7,491
Borrowings 8 1,845,947 -
TOTAL LIABILITIES 2,491,054 404,576
TOTAL EQUITY AND LIABILITIES 15,153,623 14,901,005
BEOWULF MINING PLC
CONDENSED COMPANY STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2022
Notes (Unaudited) (Audited)
As at As at
31 December 31 December 2021
2022 £
£
ASSETS
Non-current assets
Investments 3,645,181 2,377,988
Loans and other financial assets 11,084,289 10,179,650
Property, plant and equipment 834 1,112
14,730,304 12,558,750
Current assets
Trade and other receivables 53,284 41,185
Cash and cash equivalents 1,667,840 3,075,741
1,721,124 3,116,926
TOTAL ASSETS 16,451,428 15,675,676
EQUITY
Shareholders' equity
Share capital 5 8,317,106 8,317,106
Share premium 24,689,311 24,689,311
Capital contribution reserve 46,451 46,451
Share option reserve 516,098 668,482
Merger reserve 137,700 137,700
Accumulated losses (19,317,455) (18,337,714)
TOTAL EQUITY 14,389,211 15,521,336
LIABILITIES
Current liabilities
Trade and other payables 216,270 114,491
Grant income - 39,849
Borrowings 8 1,845,947 -
TOTAL LIABILITIES 2,062,217 154,340
TOTAL EQUITY AND LIABILITIES 16,451,428 15,675,676
BEOWULF MINING PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE TWELVE MONTHS TO 31 DECEMBER 2022
Share capital Share premium Capital contribution reserve Share-based payment reserve Merger reserve Translation reserve Accumulated losses Total Non- Total equity
controlling
interest
£ £ £ £ £ £ £ £ £ £
8,281,752 24,684,737 46,451 732,185 137,700 (457,272) (17,083,186) 16,342,367 394,113 16,736,480
At 1 January 2021
Loss for the year - - - - - - (1,351,179) (1,351,179) (134,432) (1,485,611)
Foreign exchange translation - - - - - (759,713) - (759,713) (34,655) (794,368)
Total comprehensive loss - - - - - (759,713) (1,351,179) (2,110,892) (169,087) (2,279,979)
Transactions with owners
Issue of share capital 35,354 23,334 - - - - - 58,688 - 58,688
Costs associated with the issue of new shares - (18,760) - - - - - (18,760) - (18,760)
Step up interest in subsidiary - - - - - - (100,013) (100,013) 100,013 -
Transfer of reserve on option exercised - - - (63,703) - - 63,703 - - -
8,317,106 24,689,311 46,451 668,482 137,700 (1,216,985) (18,470,675) 14,171,390 325,039 14,496,429
At 31 December 2021 (Audited)
Loss for the year - - - - - - (1,948,459) (1,948,459) (92,993) (2,041,452)
Foreign exchange translation - - - - - (72,430) - (72,430) 39,485 (32,945)
Total comprehensive loss - - - - - (72,430) (1,948,459) (2,020,889) (53,508) (2,074,397)
Transactions with owners
Equity-settled share-based payment transactions - - - 240,537 - - - 240,537 - 240,537
Step up interest in subsidiary - - - - - - (297,201) (297,201) 297,201 -
Transfer on lapse of options - - - (392,921) - - 392,921 - - -
At 31 December 2022 (Unaudited) 8,317,106 24,689,311 46,451 516,098 137,700 (1,289,415) (20,323,414) 12,093,837 568,732 12,662,569
BEOWULF MINING PLC
CONDENSED COMPANY STATEMENT OF CHANGES IN EQUITY
FOR THE TWELVE MONTHS TO 31 DECEMBER 2022
Share capital Share premium Merger reserve Capital contribution reserve Share-based payment reserve Accumulated losses Total
£ £ £ £ £ £ £
8,281,752 24,684,737 137,700 46,451 732,185 (17,168,119) 16,714,706
At 1 January 2021
Loss for the year - - - - - (1,233,298) (1,233,298)
Total comprehensive loss - - - - - (1,233,298) (1,233,298)
Transactions with owners
Issue of share capital 35,354 23,334 - - - - 58,688
Costs associated with the issue of new shares - (18,760) - - - - (18,760)
Transfer of reserve on option exercised - - - - (63,703) 63,703 -
8,317,106 24,689,311 137,700 46,451 668,482 (18,337,714) 15,521,336
At 31 December 2021 (Audited)
Loss for the year - - - - - (1,372,662) (1,372,662)
Total comprehensive loss - - - - - (1,372,662) (1,372,662)
Transactions with owners
Equity-settled share-based payment transactions - - - - 240,537 - 240,537
Transfer on lapse of options - - - - (392,921) 392,921 -
At 31 December 2022 (Unaudited) 8,317,106 24,689,311 137,700 46,451 516,098 (19,317,455) 14,389,211
BEOWULF MINING PLC
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
AS AT 31 DECEMBER 2022
(Unaudited) (Audited)
31 December 2022 31 December
2021
£ £
Cash flows from operating activities
Loss before income tax (2,041,452) (1,485,611)
Depreciation charges 46,388 36,790
Equity-settled share-based transactions 240,537 23,334
Impairment of exploration costs 36,988 -
Impairment of PPE - 48,966
Finance income (176) (71)
Finance expense 304,796 256
Grant income (84,797) (66,589)
Gain on sale of fixed asset - (17,414)
Gain on sale of investment (21,951) -
Amortisation 6,384 5,630
Unrealised foreign exchange losses 55,335 292,452
(1,457,948) (1,162,257)
Increase in trade and other receivables (36,535) (12,796)
Decrease in trade and other payables (43,828) (174,732)
Net cash used in operating activities (1,538,311) (1,349,785)
Cash flows from investing activities
Purchase of intangible assets (1,536,674) (735,847)
Purchase of property, plant and equipment (34,397) (86,219)
Proceeds from sale of investments 21,951 -
Proceeds from sale of fixed assets - 24,806
Interest received 176 71
Net grant receipt 44,948 24,031
Net cash used in investing activities (1,503,996) (773,158)
Cash flows from financing activities
Proceeds from issue of shares in prior year - 1,392,081
Proceeds from issue of shares - 35,354
Payment of share issue costs - (18,760)
Lease principal paid (6,347) (5,594)
Lease interest paid (264) (256)
Proceeds from borrowings, net of costs 1,554,381 -
Net cash from financing activities 1,547,770 1,402,825
Decrease in cash and cash equivalents (1,494,537) (720,118)
Cash and cash equivalents at beginning of year 3,336,134 4,329,414
Effect of foreign exchange rate changes (65,041) (273,162)
Cash and cash equivalents at end of year 1,776,556 3,336,134
BEOWULF MINING PLC
CONDENSED COMPANY CASH FLOW STATEMENT
AS AT 31 DECEMBER 2022
(Unaudited) (Audited)
31 December 2022 31 December
2021
£ £
Cash flows from operating activities
Loss before income tax (1,372,662) (1,233,298)
Expected credit loss 5,336 187,340
Equity-settled share-based transactions 173,345 23,334
Depreciation 278 371
Finance income (170) (71)
Finance costs 304,529 -
Gain on disposal of investment (21,951) -
Unrealised foreign exchange losses 55,336 293,304
(855,959) (729,020)
(Increase)/decrease in trade and other receivables (12,099) 43,490
Increase /(decrease) in trade and other payables 101,779 (166,371)
Net cash used in operating activities (766,280) (851,901)
Cash flows from investing activities
Loans to subsidiaries (909,975) (1,122,845)
Interest received 170 71
Financing of subsidiary (1,200,000) (300,000)
Grant repayment (39,848) -
Proceeds from sale of investments 21,951 -
Net cash used in investing activities (2,127,701) (1,422,774)
Cash flows from financing activities
Proceeds from issue of shares in prior year - 1,392,081
Proceeds from issue of shares - 35,354
Payment of share issue costs - (18,760)
Proceeds from borrowings, net of costs 1,554,381 -
Net cash from financing activities 1,554,381 1,408,675
Decrease in cash and cash equivalents (1,339,600) (866,000)
Cash and cash equivalents at beginning of year 3,075,741 4,241,426
Effect of foreign exchange rate changes (68,301) (299,685)
Cash and cash equivalents at end of year 1,667,840 3,075,741
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM
FOR THE TWELVE MONTHS TO 31 DECEMBER 2022
1. Nature of Operations
Beowulf Mining plc (the "Company") is domiciled in England and Wales. The
Company's registered office is 201 Temple Chambers, 3-7 Temple Avenue, London,
EC4Y 0DT. This consolidated financial information comprises that of the
Company and its subsidiaries (collectively the 'Group' and individually 'Group
companies'). The Group is engaged in the acquisition, exploration and
evaluation of natural resources assets and has not yet generated revenues.
2. Basis of preparation
The condensed consolidated financial information has been prepared on the
basis of the recognition and measurement requirements of UK-adopted
International Accounting Standards in conformity with the requirements of the
Companies Act 2006. The accounting policies, methods of computation and
presentation used in the preparation of the interim financial information are
the same as those used in the Group's audited financial statements for the
year ended 31 December 2021 except as noted below.
The financial information in this statement does not constitute full statutory
accounts within the meaning of Section 434 of the UK Companies Act 2006. The
financial information for the twelve months ended 31 December 2021 is audited.
The audit of the financial information for the year ended 31 December 2022 is
currently being completed. The auditor's report on the statutory financial
statements for the year ended 31 December 2021 was unqualified and did not
contain any statement under sections 498 (2) or (3) of the Companies Act
2006.
The financial statements are presented in GB Pounds Sterling. They are
prepared on the historical cost basis or the fair value basis where the fair
valuing of relevant assets and liabilities has been applied.
Management have prepared cash flow forecasts which indicate that although
there is no immediate funding requirement, the Group will need to raise
further funds in the next 12 months for corporate overheads and to advance its
key projects and investments.
The Group are currently undertaking a preferential rights issue which is due
to complete on 28 February 2023 and the Directors are confident of being able
to raise the funds required, given the rights issue is being underwritten.
They have therefore concluded that it is appropriate to prepare the financial
statements on a going concern basis.
3. Finance costs
(Unaudited) (Unaudited) (Unaudited) (Audited)
3 months 3 months 12 months 12 months
ended ended ended ended
Group 31 December 2022 31 December 31 December 2022 31 December 2021
2021
Bridging loan amortised interest 158,499 - 304,529 -
Lease liability interest 60 77 267 256
158,559 77 304,796 256
Parent 31 December 2022 31 December 31 December 2022 31 December 2021
2021
Bridging loan amortised interest 158,499 - 304,529 -
158,499 - 304,529 -
4. Loss per share
(Unaudited) (Unaudited) (Unaudited) (Audited)
3 months 3 months 12 months 12 months
ended ended ended ended
Group 31 December 2022 31 December 31 December 2022 31 December 2021
2021
Loss for the period/year attributable to shareholders of the Company (£'s) (723,801) (296,703) (1,948,459) (1,351,188)
Weighted average number of ordinary shares 831,710,636 831,710,636 831,710,636 829,879,971
Loss per share (p) (0.09) (0.04) (0.23) (0.16)
Parent
Loss for the period/year attributable to shareholders of the Company (£'s) (390,201) (210,264) (1,372,662) (1,233,298)
Weighted average number of ordinary shares 831,710,636 831,710,636 831,710,636 829,879,971
Loss per share (p) (0.05) (0.03) (0.17) (0.15)
5. Share capital
(Unaudited) (Audited)
31 December
2022
31 December 2021
£ £
Allotted, issued and fully paid
Ordinary shares of 1p each 8,317,106 8,317,106
The number of shares in issue was as follows:
Number
of shares
Balance at 1 January 2021 828,175,224
Issued during the year 3,535,412
Balance at 31 December 2021 831,710,636
Issued during the year -
Balance at 31 December 2022 831,710,636
6. Share based payments
During the year ended 31 December 2022, 23,250,000 options were granted (2021:
Nil). The options outstanding as at 31 December 2022 have an exercise price in
the range of 1.00 pence to 7.35 pence (2021: 7.35 pence to 12.00 pence) and a
weighted average remaining contractual life of 7 years, 98 days (2021: 1 year,
234 days).
The share-based payments expense for the options for the year ended 31
December 2022 was £240,537 (2021: £Nil).
The fair value of share options granted and outstanding were measured using
the Black-Scholes model, with the following inputs:
2022 2019
Number of options 20,750,000 2,500,000 9,250,000
Fair value at grant date 3.12p 3.59p 1.15p
Share price 4.00p 4.00p 5.65p
Exercise price 5.25p 1.00p 7.35p
Expected volatility 100% 100% 51.89%
Option life 10 years 10 years 5 years
Risk free interest rate 4.480% 4.520% 0.718%
The options issued will be settled in the equity of the Company when exercised
and have a vesting period of one year from date of grant.
Reconciliation of options in issue Number Weighted average exercise price(£'s) Number Weighted average exercise price(£'s)
2022 2022 2021 2021
Outstanding at 1 January 13,750,000 0.089 22,750,000 0.060
Granted during the year 23,250,000 0.048 - -
Exercised during the year - - (9,000,000) 0.017
Lapsed during the year (4,500,000) 0.120 - -
Outstanding at 31 December 32,500,000 0.055 13,750,000 0.089
Exercisable at 31 December 11,750,000 0.060 13,750,000 0.089
7. Intangible assets: Group
Exploration costs As at As at
31 December 31 December
2022 2021
(Unaudited) (Audited)
£ £
Cost
At 1 January 11,235,656 11,371,916
Additions for the year 1,850,946 682,367
Foreign exchange movements (47,149) (818,627)
Impairment (36,988) -
13,002,465 11,235,656
The net book value of exploration costs is comprised of expenditure on the
following projects:
As at As at
31 December 31 December
2022 2021
(Unaudited) (Audited)
£ £
Project Country
Kallak Sweden 7,666,563 7,210,380
Åtvidaberg Sweden 358,694 363,131
Ågåsjiegge Sweden 7,718 6,482
Pitkäjärvi Finland 1,641,836 1,457,826
Rääpysjärvi Finland 148,430 73,859
Karhunmäki Finland 56,089 51,622
Merivaara Finland - 36,096
Mitrovica Kosovo 2,430,150 1,376,598
Viti Kosovo 687,065 659,662
Emas Finland 1,663 -
Luopioinen Finland 4,257 -
13,002,465 11,235,656
Total Group exploration costs of £13,002,465 are currently carried at cost in
the financial statements. The impairment charge arising from the impairment of
the project Merivaara was £36,988 (31 December 2021: £nil).
Accounting estimates and judgements are continually evaluated and are based on
a number of factors, including expectations of future events that are believed
to be reasonable under the circumstances. Management are required to consider
whether there are events or changes in circumstances that indicate that the
carrying value of this asset may not be recoverable.
The most significant exploration asset within the Group is Kallak. The Company
applied for an Exploitation Concession for Kallak North in April 2013 and this
was finally awarded in March 2022.
Kallak is included in the condensed financial statements as at 30 December
2022 as an intangible exploration licence with a carrying value of
£7,666,563. Given the Exploitation Concession was awarded, Management have
considered that there is no current risk associated with Kallak and thus have
not impaired the project.
8. Borrowings
(Unaudited) (Audited)
31 December 2022 31 December 2021
£ £
Current
Bridging loan 1,845,947 -
Total 1,845,947 -
On 3 July 2022, the Company secured a bridging loan from a Nordic investor of
SEK 22 million (approximately £1.76 million) before expenses. The Loan has a
fixed interest rate of 1.5 percent per stated 30-day period during the
duration. Accrued interest is compounding. The Loan has a commitment fee of
5 per cent and a Maturity Date of 28 February 2023.
Beowulf can repay the Loan and accrued interest at any time prior to the
Maturity Date. If the Loan and accrued interest is not repaid by 28 February
2023, at the latest, the Creditors have the right to offset a minimum of SEK 1
million at a time of the Loan and accrued interest into Swedish Depository
Receipts ("SDR") at a price per SDR calculated with a 15 per cent discount on
the volume weighted average price of the SDR during the preceding 5 trading
days to the conversion decision.
9. Post balance sheet events
On 12 January 2023, the Company announced further investment in Vardar
Minerals Limited of £250,000. The investment increases the Company's
ownership in Vardar from 59.5 per cent to 61.1 per cent approximately. This
funding will be used to start preparations for the 2023 exploration programme.
On 25 January 2023 the Company announced the launch of a preferential rights
issue of up to 316,681,938 Swedish Depository Receipts ("SDRs") and a
PrimaryBid retail offer of up to 104,000,000 ordinary shares of 1 pence each
in the capital of the Company in the UK. In addition, members of the Board and
executive management have agreed to subscribe for a total of 8,800,481 New
Ordinary Shares, equivalent of approximately £181,000. The SDRs represent
interests in Ordinary Shares and the preferential rights issue of SDRs will
amount to approximately SEK 85.5 million (approximately £6.8 million) before
deduction for transaction related costs. The PrimaryBid retail offer of
Ordinary Shares in the UK, will amount to a maximum of approximately SEK 27.1
million (approximately £2.1 million) before deduction for transaction related
costs.
Following the year end it became apparent that due to the timing of the
receipt of the funds from the preferential rights issue, the Company will not
be in a position to pay back the bridging loan facility at its maturity. The
outcome of this is that the holder of the loan will enforce the penalty
interest for entering another 30-day period, which is expected to be circa 1
million SEK.
On 31 January 2023 there were 633,363,876 Swedish Depository Receipts
representing 76.15 per cent of the issued share capital of the Company. The
remaining issued share capital of the Company is held in the UK.
10. Availability of Unaudited Preliminary Financial Results
A copy of these results will be made available for inspection at the Company's
registered office during normal business hours on any weekday. The Company's
registered office is at 207 Temple Chambers, 3-7 Temple Avenue, London, EC4Y
0DT. A copy can also be downloaded from the Company's website at
www.beowulfmining.com. Beowulf Mining plc is registered in England and Wales
with registered number 02330496.
** Ends **
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