29th Aug 2014 09:02
LONDON (Alliance News) - Beowulf Mining PLC Friday said its operating loss widened in the first half of the year due to higher administrative expenses, and the company said it would accelerate marketing of magnetite from its Swedish Kallak operations to try and drive actual revenue.
The iron ore developer said it wants to move away from exploration and a focus on drilling, to become a development company focused on mining and product sales.
"With this is mind we intend to accelerate the marketing of the high quality Kallak North magnetite," Chairman Clive Sinclair-Poulton said in a statement.
The company reported a pretax loss of GBP1.3 million for the six months to June 30, wider than the GBP479,286 loss it reported a year earlier, mainly due to a GBP777,033 fair value loss on derivative financial assets. The company isn't currently earning any revenue.
Excluding the fair value loss, its operating loss widened to GBP544,044, from GBP504,616 in the first half of 2013, due to an increase in administrative expenses.
It ended the half with about GBP569,000 in cash, but earlier this month said it planned to raise up to GBP2.0 million in a equity issue, funds it will use to further develop the Kallk site in Sweden.
Beowulf currently has five exploration projects in northern Sweden primarily prospecting for iron, copper and gold, but its focus is on the Kallak deposits.
The company said "contradictory economic messages from China and Europe have created an atmosphere of uncertainty in iron ore markets...this has had a dulling impact on iron prices which are low." However, it expects iron ore prices to be closer to USD100 a tonne when it brings Kallak into production.
The company recently announced positive assay results from the site. At Kallak North, one inclined hole showes an average 30.7% iron content and another section of the same hole showed 41.2% iron content. At Kallak South, it reported one of the seven holes drilled at the site showed 26.4% average iron content.
In total, it had drilled more than 8.2 kilometres at Kallak North and South so far in 2014, and has just over five miles of cores.
Beowulf shares were up 0.84% to 3.00p per share Friday morning.
By Joshua Warner; [email protected]; @joshalliance
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