Interim Report January-June 2012

 Significant events during the period



·        Production at the Dannemora iron ore mine commenced on 2 April.
Adjustments and fine-tuning of the sorting plant aimed at gradually increasing
production have continued during the spring.

·        The first iron ore delivery of 18,000 tonnes was shipped via Hargshamn
to Salzgitter Flachstahl in Germany.

·        Pär Göting was appointed as a new member of Dannemora Mineral's
Management Group.

·        The official opening of the Dannemora iron ore mine was performed by
King Carl XVI Gustaf on 13 June 2012.

·        Net sales for the period January - June 2012 amounted to SEK 14.4 (1.7)
million. Profit/loss after net financial items during the same period amounted
to SEK -111.2 (-32.5) million.

·         Total cash flow for the period January - June 2012 was SEK -333.3
(609.4) million, of which SEK -348.6 (280.3) million related to investments.

   · Cash & cash equivalents at 30 June 2012 were SEK 295.8 (922.7) million.



Significant events after the end of the period


  * Production of iron ore products during 2012  is expected to be approx.
    400,000 tonnes, compared with the planned 500,000 tonnes. This is expected
    to result in lost revenue of approx. SEK 70 million in 2012.


  * Together, the revenue shortfall and action programme mean that there is a
    need to strengthen the Company's liquidity by approx. SEK 100 million during
    the present year. Different financing options are being investigated at
    present.

  * On 1 September, Pär Göting takes up the position of Head of Operations at
    the Dannemora iron ore mine, succeeding Kjell Klippmark who has been
    appointed CEO of Pajala Utveckling AB, PUAB.

  * With effect from week 34, production and processing at the Dannemora iron
    ore mine is run in three shifts, seven days a week.


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