Dannemora reduces need for additional financing
(Thomson Reuters ONE) -
In Dannemora Mineral's interim report for the third quarter of 2011, the Company
announced that additional investments of SEK 120 million in new, safer and more
efficient ramp systems in the Dannemora iron ore mine had been approved. The
report also announced increased costs of SEK 22 million related to consulting
support in the Company's investment project and an increase in tied-up working
capital of SEK 20-30 million due to the construction of a quality assurance
store over in Hargshamn.
Since then the Company has been actively working to reduce the need for
additional financing. This has led to shifts in non-time-critical investments
and various measures to free up working capital.
The fact that Dannemora's investment project has progressed without disruption
or cost overruns and the production start-up date will be met also means the
Company will quickly arrive at a situation of positive cash flows.
It is Dannemora Mineral's assessment that the Company's additional capital
requirement for financing the Dannemora iron ore mine in the period until a
positive cash flow is achieved amounts to approx. SEK 100 million. The Company
does not expect this need for additional financing to arise until some time
after commercial operation has started at the Dannemora iron ore mine.
Dannemora Mineral also believes that the capital requirement should be funded by
equity. Consequently, Dannemora Mineral plans to implement a new share issue of
approx. SEK 100 million sometime during the next 6-month period, when the
capital market is considered beneficial. The new share issue is likely to be
implemented without preferential rights for existing shareholders
Read Press release below
Press release 21 Februrary 2012:
http://hugin.info/137553/R/1587804/498109.pdf
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Source: Dannemora Mineral AB via Thomson Reuters ONE
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