Anglesey Mining plc LSE:AYM
17 January 2013
LIM Announces Equity Financing
Anglesey Mining's 19.7% owned associate Labrador Iron Mines
Holdings Limited (TSX:LIM) announces that it has filed a
preliminary short form prospectus in connection with an overnight
marketed public offering (the "Offering") of common shares in LIM (
"Common Shares"). The Offering will be conducted through a
syndicate of underwriters led by Canaccord Genuity Corp. (the
"Underwriters"). LIM will also grant the Underwriters an
over-allotment option to purchase up to that number of additional
common shares (the "Over-Allotment Common Shares") equal to 15% of
the Common Shares sold pursuant to the Offering, exercisable at any
time up to 30 days after and including the closing of the Offering
at a price equal to the offering price of the Common Shares.
The Offering will be priced in the context of the market with
final terms of the Offering to be determined at the time of
pricing.
LIM intends to use the net proceeds from the Offering to fund
mining, processing and inventory costs, including payments to the
LIM's mining contractors, and transportation costs in connection
with the resumption of production operations and to supplement
working capital and general and administrative costs for the
remaining winter season.
For the 2012 operating season LIM met its reduced 2012
production target of 1.7 million wet tonnes of iron ore production
and sold a total of 1.56 million dry tonnes of iron ore products.
LIM sold two cape-size shipments in October for approximately
322,000 dry tonnes, the sales proceeds of one of which were
received in October and one final shipment of lump ore of
approximately 103,000 tonnes, the sales proceeds of which remained
receivable as at December 31, 2012
and were received in January
2013.
LIM expects to report revenue from iron ore sales of
approximately $23 million for the
quarter ended December 31, 2012, and
approximately $94 million for the
nine month period ended December 31,
2012. As at December 31, 2012,
LIM had cash of approximately $10
million and expects to be in a positive working capital
position as at that date.
For 2013 and following years, operations will be focused on
LIM's Stage 1 deposits including the James Mine (currently
operating) and six smaller satellite deposits and some historical
stockpiles located within a 15 km radius of the James Mine and the
Silver Yards processing plants. LIM is currently targeting
production for the 2013 season at a similar level as in 2012 of
between 1.7 million and 2 million wet tonnes of iron ore
produced.
In resuming its planned seasonal mining operations in the spring
of 2013, for its 2014 fiscal year, LIM will incur regular
operating, mining and transportation expenses for the months of
April and May, 2013 before receipt of payment for its first sales
of iron ore anticipated in June 2013
and will require working capital of approximately $40 million to fund these operating and re-start
expenses.
LIM has been actively pursuing working capital financing
arrangements for the seasonal start-up of operations in the first
quarter of its 2014 fiscal year (April to June 2013). Such financings may include an
operating line of credit or product off-take arrangements or a
combination of these alternatives. However, while a number of
institutions have provided term sheets for financings in the range
of $20 to $40 million, subject to
various conditions, and undertaken due diligence, at the present
time there can be no assurance that such financing can be fully
completed by the beginning of the 2013 operating season.
Accordingly, LIM is pursuing the Offering to ensure no delay in the
orderly seasonal resumption of operations in April 2013.
LIM's preliminary operating results for the quarter ended
December 31, 2012 and for the nine
months ended December 31, 2012 are
outlined in the table below.
Quarter Ended December Nine Months Ended December
31, 2012 31, 2012
(all tonnes are dry Tonnes Grade % Fe Tonnes Grade (% Fe)
metric tonnes)
Total Ore Mined 198,467 59.9% 1,828,398 61.3%
Direct Rail Ore portion 159,637 60.9% 1,212,870 62.3%
Waste Mined 224,548 -- 3,127,158 --
Ore Processed and 183,635 59.8% 954,813 58.2%
Screened
Lump Ore Produced 18,082 64.6% 98,693 61.2%
Sinter Fines Produced 149,698 61.4% 693,173 61.4%
Total Product Railed 254,136 61.8% 1,492,960 62.3%
Tonnes Product Sold 425,472 62.0% 1,559,620 62.5%
Port Product Inventory 111,009 60.9% 111,009 60.9%
Site Product Inventory 3,551 58.4% 3,551 58.4%
Site Run-of-Mine Ore 446,975 56.2% 446,975 56.2%
inventory
The Offering is being made pursuant to a short form prospectus
to be filed in each of the provinces of Canada other than Quebec. The Offered Securities will not be
registered under the U.S. Securities Act of 1933, as amended, and
may not be offered or sold in the United
States absent registration or an applicable exemption from
the registration requirements.
This press release does not constitute an offer of securities
for sale in the United States. The
securities being offered have not been, nor will be, registered
under the United States Securities Act of 1933, as amended, and may
not be offered or sold within the United
States absent U.S. registration or an applicable exemption
from U.S. registration requirements.
For further information, please visit LIM's website at
www.labradorironmines.ca
About Anglesey Mining plc
Anglesey holds 19.7% of Toronto-listed Labrador Iron Mines Holdings
Limited (TSX:LIM) which is producing high grade hematite from its
James pit, one of LIM's twenty direct shipping iron ore deposits in
western Labrador and north-eastern
Quebec.
Anglesey is also carrying out exploration and development work
at its 100% owned Parys Mountain zinc-copper-lead deposit in
North Wales, UK where a JORC
Code-compliant resource of 2.1mt at 6.9% combined base metals in
the indicated category and 4.1mt at 5.0% combined in the inferred
category was published in November
2012.
For further information, please contact:
Bill Hooley, Chief Executive +44
(0)1492 541981; Ian Cuthbertson,
Finance Director +44 (0)1248 361333; Samantha Harrison / Klara Kaczmarek: RFC Ambrian +44 (0)20 3440
6800; Emily Fenton / Jos Simson:
Tavistock Communications +44 (0)20 7920 3155