Market Overview

PolyMet Reports Second Quarter Fiscal 2018 Results


And Secures Additional US$20 Million Loan From Glencore

PolyMet Mining Corp ("PolyMet" or the "company") TSX: POM; NYSE
AMERICAN: PLM – today reported that it has filed its financial results
for the three and six months ended July 31, 2017. PolyMet also agreed to
issue up to an additional $20 million secured debenture to Glencore AG,
a wholly owned subsidiary of Glencore plc.

"We appreciate and welcome Glencore's continued financial and technical
support. This gives us solid financial footing to advance the permitting
process, in which tremendous progress has been made this year. We look
forward to the state releasing the remaining draft permits for public
review later this fall," said Jon Cherry, president and CEO. More detail
on the status of NorthMet permits can be found at:

PolyMet controls 100 percent of the development-stage NorthMet
copper-nickel-precious metals ore body and the nearby former LTV Steel
Mining Company site, located near Hoyt Lakes in the established mining
district of the Mesabi Iron Range in northeastern Minnesota.

The financial statements have been filed at
and on SEDAR and EDGAR and have been prepared in accordance with
International Financial Reporting Standards. All amounts are in U.S.
funds. Copies can be obtained free of charge by contacting the Corporate
Secretary at First Canadian Place, 100 King Street West, Suite 5700,
Toronto, Ontario M5X 1C7 or by email at

Recent Highlights

  • In November 2015, the Final Environmental Impact Statement was issued
    demonstrating that the NorthMet Project, as designed, is capable of
    being constructed and operated in compliance with environmental and
    human health standards.
  • In 2016, the company submitted applications for the Permit to Mine,
    air quality permits, water discharge permits, water appropriation
    permits, and dam safety permits required to construct and operate
  • In January 2017, the U.S. Forest Service issued its Final Record of
    Decision authorizing the land exchange.
  • In June 2017, the company appointed Patrick Keenan as Chief Financial
  • In June 2017, U.S. Rep. Rick Nolan, D-MN-8, introduced bipartisan
    legislation to direct the secretary of agriculture to move forward
    with the land exchange between PolyMet and the U.S. Forest Service,
    which will accelerate transfer and provide certainty of process.
  • In August 2017, the Minnesota Department of Natural Resources released
    six draft water appropriation permits for 30-days of public review and
    comment. The comment period closed September 12, 2017.
  • In September 2017, the company agreed to issue up to an additional $20
    million secured debenture to Glencore AG, a wholly owned subsidiary of
    Glencore plc, to fund permitting and general corporate purposes. The
    debentures are on similar terms as the existing non-convertible senior
    secured debentures.

Goals and Objectives for the Next Twelve Months

The permitting process is managed by the regulatory agencies. Therefore,
timelines are not under PolyMet control. Given these circumstances,
PolyMet's objectives include:

  • Transfer of title to the surface rights over and around the NorthMet
    mineral rights to PolyMet as part of the authorized land exchange with
    the U.S. Forest Service.
  • Publication of draft state permits for public comment.
  • Decisions on state permits (Permit to Mine, air, water, and dam safety
  • Decision by the U.S. Army Corps of Engineers on the Clean Water Act
    Section 404 permit.
  • Completion of definitive cost estimate and project update following
  • Completion of project implementation plan.
  • Repayment, restructuring and/or conversion of existing debt.
  • Completion of construction finance plan including commitment of debt,
    subject to the issuance of permits.

Key Balance Sheet Statistics

(in ‘000 US dollars)

Balance Sheet       July 31, 2017       January 31, 2017
Cash & equivalents $ 4,243 $ 18,674
Working capital (116,198) 16,267
Total assets 395,353 389,049
Total liabilities 192,762 181,720
Shareholders' equity     $ 202,591     $ 207,329

At July 31, 2017, PolyMet had cash of $4.243 million compared with
$18.674 million at January 31, 2017. The company is in discussion with
Glencore regarding the convertible and non-convertible senior secured
debentures currently due to be repaid upon the earlier of availability
of construction finance or March 31, 2018.

As of July 31, 2017, PolyMet had spent $125.537 million on environmental
review and permitting, of which $119.086 million has been spent since
the NorthMet Project moved from exploration to development stage.

Key Income and Cash Flow Statement Statistics

(in ‘000 US dollars, except per share amounts)

    Three months ended     Six months ended
      July 31,     July 31,
Income and Cash Flow Statement     2017     2016     2017     2016
General & administrative expense excluding non-cash share-based
$ 1,408     $ 945 $ 2,536     $ 2,158

Non-cash share-based compensation





Other Expenses:

Finance & Other

608 377 1,241 889

Non-cash loss on disposal of intangibles

      -       -       1,324       -
Loss for the period: 2,688 1,555 5,913 3,907
Other Comprehensive (Income)       17       (48)       5       (104)
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