Talvivaaran Kaivososakeyhtiö Oyj : Talvivaara Mining Company Interim Report for January-March 2013

 Talvivaaran Kaivososakeyhtiö Oyj : Talvivaara Mining Company Interim Report
                            for January-March 2013

Stock Exchange Release
Talvivaara Mining Company Plc
24 April 2013

       Talvivaara Mining Company Interim Report for January-March 2013

       Financing transactions to secure liquidity for continued ramp-up
          Operational focus on achieving a sustainable water balance

Highlights

  oNickel production of 2,732t, impacted by continued water balance
    challenges and the effect of excess water on bioheapleaching
  oNet sales of EUR 27.6 million
  oOperating loss of EUR (20.0) million
  oPurification and discharge of excess water from the mine site commenced in
    March utilising the additional 1.8Mm3 discharge quota granted by the
    Kainuu Centre for Economic Development, Transport and the Environment
    ("Kainuu ELY Centre") in February 2013


Financing transactions
A number of financing arrangements undertaken to de-risk Talvivaara's balance
sheet, secure liquidity for the continued ramp-up of operations towards full
capacity and provide an appropriate capital structure to enable repayment or
refinancing of short- and medium-term indebtedness, including the remaining
EUR 76.9 million convertible bond maturing in May 2013.

The financing transactions consist of:

  oFully underwritten rights issue to raise approximately EUR 261 million in
    gross proceeds
  oRenegotiated EUR 100 million revolving credit facility
  oIncrease of advance payment from Cameco by USD 10 million to USD 70
    million
  oEUR 12 million additional up-front payment from Nyrstar



Events after the reporting period

  oOversubscribed EUR 261 million rights issue completed; trading in new
    shares commenced on 17 April 2013
  oGypsum pond leakage detected on 7 April 2013 and stemmed on 9 April 2013;
    all leakage waters contained within the mining area
  oOre production operations expected to be re-started in May, approximately
    1.5 months ahead of earlier plans; temporary lay-offs announced in
    February cancelled due to mining re-start

Production guidance
2013 full-year nickel production guidance of 18,000t re-iterated; return to a
clear ramp-up anticipated in the second half of the year following re-start of
mining in May and improving water balance situation

Key figures

EUR million                                        Q1       Q4      Q1      FY
                                                 2013     2012    2012    2012
Net sales                                        27.6     25.7    39.0   142.9
Operating profit (loss)                        (20.0)   (57.0)  (11.4)  (83.6)
 % of net sales                          (72.4)% (221.9)% (29.3)% (58.5)%
Profit (loss) for the period                   (23.9)   (59.4)  (14.9) (103.9)
Earnings per share, EUR                        (0.09)   (0.22)  (0.06)  (0.38)
Equity-to-assets ratio                          25.5%    24.3%   31.8%   24.3%
Net interest bearing debt                       530.1    563.8   422.2   563.8
Debt-to-equity ratio                           159.1%   183.8%  107.9%  183.3%
Capital expenditure                              17.3     29.6    14.7    97.5
Cash and cash equivalents at the end of the      68.7     36.1    85.9    36.1
period
Number of employees at the end of the period      583      588     498     588

All reported figures in this release are unaudited.



CEO Pekka  Perä  comments:  "In February,  we  announced  extensive  financing 
arrangements to improve our liquidity position and de-risk our balance  sheet. 
The central element of the financing package was an underwritten rights  issue 
to our shareholders to raise approximately  EUR 261 million. The rights  issue 
was successfully completed in April, and I am especially pleased to note  that 
the transaction was oversubscribed.



Operationally, our  focus  during  the  first quarter  was  on  resolving  the 
prevailing water balance  challenges. We commenced  the discharge of  purified 
excess waters into the environment in order to prepare for the spring melt and
ensure sufficient safety capacity. With  the spring melt having commenced,  we 
are confident that  the safety capacity  is now sufficient.  However, we  will 
need to continue discharging  excess waters in order  to further moderate  the 
operational and  environmental risk  levels. Beyond  resolving the  short-term 
water balance  issue,  we are  also  focusing on  implementing  a  sustainable 
long-term water balance  and taking all  necessary measures to  ensure we  can 
avoid similar problems in the future.



In line with our expectations, metals  production output in the first  quarter 
continued to be impacted by depressed metal grades in leach solution, stemming
from excess water in  circulation and related  aeration challenges. Whilst  we 
expect a  material improvement  in bioheapleaching  performance to  take  some 
months, we have seen encouraging developments in heap sections where  aeration 
and irrigation improvements have been made and water content has been restored
to a more normal level. While ore production has been suspended, we have  also 
carried out extensive  development work  to improve our  understanding of  the 
bioleaching process and believe  we have found ways  to improve the  stability 
and predictability of the bioleaching performance going forward. We have  also 
recently announced the intention  to re-start ore production  in May ahead  of 
earlier plans, which will both help  with water balance management as new  ore 
ties up  a significant  amount of  water and  support the  achievement of  our 
production targets.



Our financial  performance  remained disappointing,  reflecting  the  achieved 
production levels  and  the depressed  nickel  price environment.  The  nickel 
market showed some  signs of  improvement early in  the year,  but the  nickel 
price has  since declined  back to  around USD  16,000/t in  early April  amid 
record stock levels at the London Metal Exchange. Whilst short-term visibility
is very limited, we  continue to believe in  strong longer-term nickel  market 
fundamentals.



Finally, I would like to sincerely thank our shareholders for their  continued 
support for Talvivaara through  these challenging times, as  well as our  team 
and advisors for their hard work and dedication. We will use the proceeds from
the completed rights issue to  resolve our short-term challenges and  continue 
the ramp-up of production towards full capacity. Our clear vision continues to
be for  Talvivaara  to become  a  successful and  internationally  significant 
player in the mining industry, and today Talvivaara is at a new beginning."

Enquiries:

Talvivaara Mining Company Plc. Tel. +358 20 712 9800
Pekka Perä, CEO
Saila Miettinen-Lähde, Deputy CEO and CFO

College Hill Tel. +44 20 7457 2020
David Simonson
Anca Spiridon

Webcast and conference call on 24 April 2013 at 1:00pm EET / 11:00am BST

A combined webcast and conference call on the January-March 2013 Interim
Result will be held on 24 April 2012 at 1:00pm EET / 11:00am BST. The call
will be held in English.

The webcast can be accessed through:
http://qsb.webcast.fi/t/talvivaara/talvivaara_2013_0424_q1/

A conference call facility will be available for a Q&A with senior management
following the presentation.
Participant - Finland: +358 (0)9 2313 9201
Participant - UK: +44 (0)20 7162 0077
Participant - US: +1 334 323 6201

Conference ID: 931705
The webcast will also be available for viewing on the Talvivaara website
shortly after the event.

Financial review

Q1 2013 (January-March)

Net sales and financial result

Talvivaara's net sales for nickel and cobalt deliveries to Norilsk Nickel  and 
for zinc deliveries to Nyrstar during the quarter ended 31 March 2013 amounted
to EUR 27.6 million (Q1 2012: EUR 39.0 million). Most of the net sales for the
three months came from  nickel. Only one zinc  delivery took place during  the 
period, amounting to 2,217t in February 2013, and due to high moisture content
some zinc was stored at the Kokkola port until the product is sufficiently dry
for transportation. Compared to Q4 2012, net sales increased by 7.4% primarily
due to increased nickel  product deliveries. However,  the increase in  nickel 
deliveries was partially offset by a lower nickel price. Product deliveries in
Q1 2013 amounted to  2,746t of nickel,  88t of cobalt and  2,217t of zinc  (Q1 
2012: 3,522t of nickel, 8,333t of zinc, 96t of cobalt).

The Group's other operating income amounted  to EUR 0.7 million (Q1 2012:  EUR 
1.4 million) and mainly resulted from indemnities on property damages.

Changes in inventories of finished goods and work in progress amounted to  EUR 
7.3 million (Q1 2012:  EUR 22.5 million). Due  to the temporary suspension  of 
mining and crushing operations, no new ore was stacked during Q1 2013 and  the 
increase in  work  in  progress  was  therefore  smaller  than  during  normal 
operations.

Personnel expenses  were EUR  (7.3) million  in Q1  2013 (Q1  2012: EUR  (7.8) 
million). The  personnel  expenses  based  on  options  granted  to  employees 
decreased by EUR 1.0 million  compared to Q1 2012.  In addition, there was  an 
increase of EUR 0.5 million in wages  and salaries due to increased number  of 
personnel. The  increase was  partially offset  by temporary  lay-offs,  which 
Talvivaara started in February 2013.

Operating loss  for  Q1 2013  was  EUR (20.0)  million  (Q1 2012:  EUR  (11.4) 
million). Materials and services were EUR (22.6) million in Q1 2013 (Q1  2012: 
EUR (34.9) million) and other operating  expenses were EUR (12.6) million  (Q1 
2012: EUR (18.9) million). The  largest cost items were production  chemicals, 
external services, electricity and maintenance. Mining and materials  handling 
costs were  lower than  in Q1  2012 due  to the  temporary suspension  of  ore 
production. In metals recovery,  costs were higher than  in the previous  year 
due to  increased hydrogen  sulphide and  hydrogen peroxide  consumption as  a 
result of inefficiencies caused by low  metal grades in feed solution and  low 
solution temperatures. Furthermore, certain process change trials resulted  in 
temporarily increased usage of sodium hydroxide in January and February 2013.

Finance income for Q1  2013 was EUR  0.3 million (Q1  2012: EUR 1.7  million). 
Finance costs of EUR (12.1) million  (Q1 2012: EUR (9.6) million) were  mainly 
related to interest and related financing expenses on borrowings.

Loss for the period and the total comprehensive income amounted to EUR  (23.9) 
million (Q1 2012:  EUR (14.9)  million) reflecting the  relatively low  nickel 
price, high maintenance costs and only moderate amounts of product deliveries.
Earnings per share were EUR (0.09) in Q1 2013 (Q1 2012: EUR (0.06)).



Balance sheet

Capital expenditure in Q1  2013 totalled EUR 17.3  million (Q1 2012: EUR  14.7 
million). The  expenditure  primarily  related to  water  management,  uranium 
extraction circuit and  secondary leaching. On  the consolidated statement  of 
financial position as at 31 March 2013, property, plant and equipment totalled
EUR 813.6 million (31 December 2012: EUR 809.5 million).

In the Group's assets, inventories amounted  to EUR 306.5 million on 31  March 
2013 (31  December  2012: EUR  297.8  million). The  increase  in  inventories 
reflects the continuing ramp-up of  production and the consequent increase  in 
the amount of ore stacked on  heaps, valued at cost. The temporary  suspension 
of ore production reduced the rate of increase in inventories in Q1 2013.

Trade receivables amounted to EUR 22.4  million on 31 March 2013 (31  December 
2012: EUR  32.2 million).  The  decrease compared  to  the previous  year  was 
attributable to the  sale of  trade receivables, which  commenced in  December 
2012.

On 31 March  2013, cash  and cash equivalents  totalled EUR  68.7 million  (31 
December 2012: EUR 36.1 million). The  cash position included a proportion  of 
the funds raised through the underwritten approximately EUR 261 million rights
issue announced  on 14  February 2013.  On  31 March  2013, the  funds  raised 
amounted to EUR 54.8 million corresponding to 342.7 million new shares.

In equity and liabilities,  total equity amounted to  EUR 333.1 million on  31 
March 2013 (31 December 2012:  EUR 306.8 million). By  31 March 2013, the  net 
proceeds of EUR  49.5 million  from the rights  issue had  been recognised  in 
equity. In addition, interest cost of  EUR 3.1 million of a perpetual  capital 
loan was capitalized in equity in February 2013.

Provisions decreased from  EUR 27.5 million  on 31 December  2012 to EUR  21.8 
million at the end of  March 2013. The costs  related to water management  and 
the gypsum pond leakage  of November 2012  amounted to EUR  5.9 million in  Q1 
2013 and the corresponding provisions  were de-recognised. The incurred  costs 
came from the treatment of excess waters  with limestone and milk of lime.  In 
addition, treatment  of contaminated  soil downstream  of the  Kortelampi  dam 
commenced by removal of trees and dewatering of the area.

Borrowings decreased from EUR 599.8 million  on 31 December 2012 to EUR  598.8 
million at the end  of March 2013.  The changes in  borrowings during Q1  2013 
mainly related to finance lease liabilities.  Total advance payments as at  31 
March 2013 amounted to EUR 291.9 million, representing an increase of EUR 18.2
million from EUR 273.7 million on 31 December 2012. During Q1 2013, Talvivaara
received  a  total  of  EUR  7.4  million  in  advance  payments  from  Cameco 
Corporation based  on  the  amended uranium  off-take  agreement  between  the 
companies. In addition, EUR 12.0 million in advance payments was received from
Nyrstar based on  the amendment  agreement regarding the  zinc in  concentrate 
streaming agreement  (see  section  "Financing").  The  advance  payment  from 
Nyrstar was also amortised by EUR 1.2 million as a result of zinc deliveries.

Total equity  and liabilities  as at  31 March  2013 amounted  to EUR  1,307.0 
million (31 December 2012: EUR 1,260.8 million).

Financing

On 12 February 2013,  Talvivaara Sotkamo entered  into an amendment  agreement 
with Cameco concerning  the uranium take-in-kind  agreement pursuant to  which 
the amount of  the up-front  investment that Cameco  is to  pay to  Talvivaara 
Sotkamo for the construction of the uranium extraction facility was  increased 
by USD  10  million to  USD  70 million.  In  addition, the  duration  of  the 
agreement was  extended  to 31  December  2017 and  commercial  terms  revised 
accordingly.  Talvivaara  received  the  additional  up-front  investment   in 
February 2013.

On 14 February 2013,  Talvivaara Sotkamo entered  into an amendment  agreement 
with Nyrstar regarding the zinc in concentrate streaming agreement pursuant to
which Nyrstar  made  an additional  up-front  payment  of EUR  12  million  to 
Talvivaara Sotkamo in  return for  Talvivaara Sotkamo agreeing  not to  charge 
Nyrstar the EUR 350 per tonne extraction and processing fee on the next 38,000
tonnes of  zinc in  concentrate delivered  to  Nyrstar as  was agreed  in  the 
original zinc in  concentrate streaming  agreement. The  up-front payment  was 
received in February 2013.

On 8 March 2013, an Extraordinary General Meeting of Talvivaara Mining Company
resolved to approve the  proposal by the Board  of Directors to authorise  the 
Board of Directors to  undertake a share issue  for consideration pursuant  to 
the shareholders'  pre-emptive  subscription rights.  The  underwritten  share 
issue was finalised in April and  all 1,633,857,840 new shares offered in  the 
rights issue were subscribed for. The gross proceeds amounted to approximately
EUR 261  million. The  total number  of shares  in Talvivaara  Mining  Company 
increased to 1,906,167,480 shares.  The share issue was  recognised in the  Q1 
2013 results as described above in section "Balance sheet".

Production review

During the  first quarter,  Talvivaara  continued to  focus on  overall  water 
balance management of the  operation and commenced  the discharge of  purified 
excess waters from the mine site.  Whilst availability of the metals  recovery 
plant continued to  be at a  good level  during the quarter,  metal grades  in 
leach solution remained, as  expected, depressed impacting metals  production. 
Zinc production during the quarter was impacted by technical issues  resulting 
in zinc being lost in thickener overflows. The causes for the issue have  been 
identified and  impact on  zinc  production is  being mitigated  through,  for 
example, modified leaching section  pumping arrangements. Talvivaara's  metals 
production output in the first quarter amounted to 2,732t (Q1 2012: 3,374t) of
nickel and 3,128t (Q1 2012: 7,890t) of zinc.

In metals recovery, significant progress continued to be made in improving and
maintaining plant  stability  and  availability.  In  line  with  Talvivaara's 
operational excellence approach, multiple new processes and metrics have  been 
developed to monitor and improve the production process and plant  efficiency. 
These improvements  have  significantly  enhanced the  ability  to  determine, 
anticipate  and  remove  any  process  disturbances  ensuring  a  high   plant 
utilisation rate. Talvivaara  reached an  average hourly  leach solution  flow 
rate through  the plant  of approximately  1,300 m3/h  in the  first  quarter, 
representing a 30% increase  compared to approximately 1,000  m3/h in 2012.  A 
record monthly  average solution  flow  rate of  1,422  m3/h was  achieved  in 
January.

As expected,  water balance  challenges  continued to  impact  bioheapleaching 
performance. The excess water in the solution circuit and reduced  evaporation 
diluted metal grades  in leach  solution, and the  high water  content in  the 
heaps also negatively affected leaching performance by reducing the efficiency
of aeration. The nickel grade in solution pumped to the metals recovery  plant 
varied between  1.1 g/l  and 1.3  g/l in  the first  quarter, compared  to  an 
average of approximately 1.3 g/l in the fourth quarter of 2012. Talvivaara has
placed significant emphasis  on improving  the leaching  process through,  for 
example, maintenance and modification of  irrigation and aeration systems  and 
obtained encouraging results  in re-activating  the leaching  process in  heap 
sections from which excess  water has been removed  and in which aeration  has 
been improved. Furthermore, extensive development work has been carried out in
order to increase  the overall understanding  of the leaching  process and  to 
achieve better  predictability and  consistency of  the leaching  performance. 
Critical operating variables have been verified by methods such as statistical
data analysis andsmall and industrial scale trials. Upon the planned re-start
of mining and stacking of new ore  in May 2013, increased attention will  also 
be paid  on the  properties of  the ore  under leaching,  with key  parameters 
including grade, mineralogical composition and agglomerate quality.

In ore production,  as previously  announced, mining  and crushing  operations 
remained suspended during the first quarter  due to excess water being  stored 
in the Kuusilampi  open pit.  Accordingly, no ore  or waste  was produced.  In 
January, following co-operation consultations, Talvivaara announced  temporary 
lay-offs of 184 employees to adjust the level of personnel to the  temporarily 
suspended ore production. Talvivaara started  to de-water the open pit  during 
the quarter, and total water volume in the pit amounted to 1.5-1.6 million  m3 
at the  end  of  the  quarter.  Despite  the  suspension  of  ore  production, 
Talvivaara continued to carry out and focus on primary heap reclaiming  during 
the quarter  and  a  new jaw  crusher  was  commissioned in  order  to  ensure 
sufficient reclaiming capacity.

Production key figures

                               Q1    Q4    Q1     FY
                             2013  2012  2012   2012
Mining
Ore production       Mt         -     -   3.0    8.7
Waste production     Mt         -   1.2   1.5    5.3
Materials handling
Stacked ore          Mt         -     -   3.0    8.7
Bioheapleaching
Ore under leaching   Mt      44.3  44.3  38.6   44.3
Metals recovery
Nickel metal content Tonnes 2,732 2,317 3,374 12,916
Zinc metal content   Tonnes 3,128 4,106 7,890 25,867

Water management - Operation Otter

In order to facilitate an efficient and sustainable solution to the prevailing
water balance  issues,  Talvivaara  has  established  a  special  task  force, 
Operation Otter.  Operation Otter  is  headed by  Ms Maija  Vidqvist,  General 
Manager, Water  Management.  Several of  Talvivaara's  key experts  have  been 
seconded to the team, which focuses on the planning and execution of necessary
water storage and pumping arrangements  and waste water treatment measures  to 
secure a sustainable water balance at the mine.

In  order  to  reach   a  sustainable  water   balance  situation  and   lower 
environmental and operational  risk levels, Talvivaara  believes that it  must 
purify and release into the environment approximately 3.8 million m3 of water,
a substantial portion of  which is rain and  natural catchment water that  has 
accumulated at  the  mine area  over  time. Based  on  the Kainuu  ELY  Centre 
decision on 12 February 2013, Talvivaara  currently has a permit to  discharge 
1.8 million m3 of purified waste water into the Vuoksi and Oulujoki waterways,
such that 0.9 million m3  is discharged into each  direction by 30 June  2013. 
Additionally, Talvivaara can continue discharging water within the annual  1.3 
million m3 discharge quota under its existing environmental permit.

Talvivaara considers  the  Kainuu  ELY  Centre  permit  for  additional  water 
discharge and the 1.3  million m3 quota in  the existing environmental  permit 
adequate for the  implementation of planned  water management arrangements  in 
the short  term. Talvivaara  commenced  the discharge  of purified  waters  in 
March, following commissioning of additional water treatment units. The levels
of harmful substances in discharged waters  have been clearly below the  limit 
values set in  Talvivaara's environmental permit.  Water quality has  remained 
consistent and quality monitoring is carried out continuously.

In order to  enable necessary  water discharge measures  beyond the  currently 
allowed quotas, Talvivaara has applied to have the annual 1.3 million m3 water
discharge limit  removed  from its  current  environmental permit  and,  as  a 
secondary request, applied  for a right  to discharge the  excess waters  that 
have accumulated at the  mine in addition to  the annual discharge limit.  The 
Regional State Administrative Agency for Northern Finland ("AVI") has informed
Talvivaara that the decision would be made in the spring.

In the medium term, Talvivaara's goal is to implement a closed water  circuit, 
which  is  expected  to  reduce  the  risk  of  weather  conditions  impacting 
Talvivaara's  operations   and  consequently   in   the  long   term   benefit 
environmental safety.  Key  elements  of the  targeted  closed  water  circuit 
include ceasing or  materially reducing  raw water intake  from nearby  lakes, 
additional treatment of process waters  using reverse osmosis technology,  and 
more efficient separation  of process  waters from captured  rain and  natural 
run-off waters. Overall, Talvivaara believes that the necessary equipment  and 
structures are already in  place to achieve a  closed water circuit.  However, 
the excess water currently at the mine has to be purified and discharged  from 
the mine and the overall water balance must reach a sustainable level before a
closed water circuit can be achieved.

Sustainable development, safety and permitting

Safety

With respect to safety issues, Talvivaara's goal is a safe and healthy working
environment, and the Company continued to develop its safety culture based  on 
zero accident philosophy.

At the end  of the first  quarter, the injury  frequency among the  Talvivaara 
personnel was 15.7 lost  time injuries/million working hours  on a rolling  12 
month basis (31 March 2012: 11.8 lost time injuries/million working hours).

Environment

Talvivaara continues to focus  on minimising the  environmental impact of  its 
operations.  Current  primary  focus  is  on  water  balance  management   and 
purification  and  discharge  of  excess  waters  from  the  mine  site.   The 
environmental impact of the release is anticipated to be mainly caused by  its 
sulphate  content,  whereas  Talvivaara  expects  any  metal  burden  to   the 
environment to  remain  limited and  within  the  limits set  by  its  current 
environmental permit. Talvivaara considers the discharge of excess water  from 
the  mine  site  without  delay  to  be  necessary  in  order  to  reduce  the 
environmental and  operational risk  levels, and  to secure  sufficient  water 
management safety capacity.

Hydrogen  sulphide  (odour)  emissions  have  been  largely  addressed.  Odour 
complaints from nearby  residents have reduced  substantially, and there  were 
only five  complaints  in the  first  quarter  of 2013.  Dust  emissions  were 
addressed through  the commissioning  of  a new  dust  removal system  at  the 
screening hall in  2012. In  line with Talvivaara's  commitment to  continuous 
improvement, several  technological solutions  are  being studied  to  further 
reduce dust emissions.

Talvivaara places significant emphasis on timely and transparent communication
on  environmental  matters  with   the  neighbouring  communities  and   other 
interested stakeholders. Open  days for  public at  the mine  site were  again 
arranged on 15-16 March 2013 and  discussion panels in nearby towns were  held 
in line with previous practice.  The locally focused Finnish language  website 
www.paikanpaalla.fi continued  to be  successfully used  for the  delivery  of 
locally relevant,  timely  information  and for  interaction  with  interested 
stakeholders.



Permitting

Talvivaara's existing environmental permit is currently being renewed under  a 
standard process. The renewed permit is anticipated to be received during  the 
third quarter  of  2013. However,  the  AVI  has informed  Talvivaara  that  a 
decision on the removal  or amendment of the  annual water discharge quota  in 
the existing  environmental permit  would be  made separately  already in  the 
spring.

The environmental permit  application for  the planned  uranium extraction  is 
also being processed by  the AVI and  a decision on it  is expected before  or 
concurrently  with  the  renewal  of  the  general  environmental  permit.  In 
addition, Talvivaara has filed an  application for a chemical permit  relating 
to uranium recovery, which is currently pending.

Additionally,  Talvivaara  continued  to  progress  the  Environmental  Impact 
Assessment for production expansion during the first quarter and received  the 
REACH authorisation for selling its copper product in the European Union.

Business development and commercial arrangements

Planned uranium extraction and uranium off-take agreement with Cameco

Talvivaara is preparing  for the recovery  of uranium as  a by-product of  the 
Company's   existing   operations.   Uranium   occurs   naturally   in   small 
concentrations in the Talvivaara  area and leaches  into the process  solution 
along with Talvivaara's other products. Annual uranium production is estimated
at ca.  350tU  (ca.  770,000  pounds),  corresponding  to  approximately  410t 
(900,000  pounds)  of  yellow   cake  (UO[4]).  Talvivaara's  entire   uranium 
production will be sold under a long-term agreement to Cameco.

The uranium recovery facility is  essentially completed, and commissioning  is 
expected following the receipt of remaining required permits.

Risk management and key risks

In line  with  current corporate  governance  guidelines on  risk  management, 
Talvivaara carries out an on-going process endorsed by the Board of  Directors 
to identify  risks,  measure  their impact  against  certain  assumptions  and 
implement the necessary proactive steps to manage these risks.

Talvivaara's operations are  affected by  various risks common  to the  mining 
industry, such as risks  relating to the  development of Talvivaara's  mineral 
deposits, estimates  of  reserves  and resources,  infrastructure  risks,  and 
volatility  of   commodity   prices.  There   are   also  risks   related   to 
counterparties, currency  exchange  ratios, management  and  control  systems, 
historical  losses  and  uncertainties  about  the  future  profitability   of 
Talvivaara,  dependence  on  key  personnel,  effect  of  laws,   governmental 
regulations and related  costs, environmental  hazards, and  risks related  to 
Talvivaara's mining concessions and permits.

In the short term,  Talvivaara's key operational risks  continue to relate  to 
water management and the on-going ramp-up of operations. While the Company has
demonstrated that all of its production processes work and can be operated  on 
industrial scale,  the  rate of  ramp-up  is  still subject  to  risk  factors 
including the time  required to reach  a sustainable level  of water  balance, 
reliability and  sustainable capacity  of production  equipment, and  eventual 
speed of  leaching  and  rates  of  metals  recovery  in  bioheapleaching.  In 
addition, there may be production and ramp-up related risks that are currently
unknown or beyond the Company's control.

The market price of nickel has historically been volatile and in the Company's
view this is likely to persist, driven by shifts in the supply-demand balance,
macroeconomic indicators and  variations in currency  exchange ratios.  Nickel 
sales  currently  represent  close  to  90%  of  the  Company's  revenues  and 
variations in the nickel price therefore have a direct and significant  effect 
on Talvivaara's financial result and economic viability. Talvivaara is,  since 
February  2010,  unhedged  against  variations   in  metal  prices.  Full   or 
substantially full  exposure to  nickel prices  is in  line with  Talvivaara's 
strategy and  supported  by  the  Company's  view  that  it  can  operate  the 
Talvivaara mine, once it has been fully ramped up, profitably also during  the 
lows of commodity price cycles.

Talvivaara's revenues are almost entirely  in US dollars, whilst the  majority 
of the Company's costs  are incurred in Euro.  Potential strengthening of  the 
Euro against the US dollar  could thus have a  material adverse effect on  the 
business and  financial  condition  of  the  Company.  Talvivaara  hedges  its 
exposure to the US dollar on a case by case basis with the aim of limiting the
adverse effects of  US dollar weakness  as considered justified  from time  to 
time.

Liquidity and  refinancing  risks may  arise  as  a result  of  the  Company's 
inability to produce sufficient volumes of its saleable products, particularly
nickel, unexpected increase  in production  costs, and  sudden or  substantial 
changes in the prices  of commodities or  currency exchange rates.  Talvivaara 
seeks to reduce liquidity  risk by close monitoring  of liquidity in order  to 
detect any threat of adverse changes in advance so as to allow for  sufficient 
time to secure access to adequate credit or other funding on reasonable terms.
Talvivaara also seeks to maintain a balanced maturity profile of its long-term
debt in order to mitigate refinancing risks.

Personnel and management

Wages and salaries

The number of personnel  employed by the  Group on 31 March  2013 was 583  (Q1 
2012: 498).

Wages and salaries paid during the three months to 31 March 2013 totalled  EUR 
6.0 million (Q1 2012: EUR 6.6 million).

The salaries and wages  of Talvivaara's personnel  are based on  industry-wide 
collective agreements.  The total  compensation consists  of base  salary  and 
short and long  term incentive  schemes. Annual short  term incentive  metrics 
include personal  performance and  company-wide criteria.  The Company's  long 
term incentive schemes comprise Talvivaara's Stock Options 2007, Stock Options
2011 and  Group  personnel  fund  to  manage  the  earnings  bonuses  paid  by 
Talvivaara. In addition, the management holding company Talvivaara  Management 
Oy is owned by executive management and certain other key employees.

Management re-organisation

Talvivaara re-organised its  management during  January and  February 2013  as 
follows:

  oMr Pertti Pekkala, formerly General Manager, Research and Development, was
    appointed Chief Production Officer (Metals Recovery);
  oMr Kari Vyhtinen, formerly Chief Investment Officer, was appointed Chief
    Mining Officer;
  oMr Mikko Korteniemi, formerly Chief Production Officer (Metals Recovery),
    was appointed Chief Maintenance Officer with responsibility for
    maintenance, procurement and warehousing; and
  oMs Maija Vidqvist was appointed General Manager, Water Management
    (position previously held by Mr Jari Voutilainen)

All four appointees  are members of  the Executive Committee,  with Mr  Pertti 
Pekkala and Ms Maija Vidqvist being new additions to it. Pertti Pekkala,  Kari 
Vyhtinen and Mikko Korteniemi report to  the COO, Mr Harri Natunen, and  Maija 
Vidqvist reports to the CEO, Mr Pekka Perä

Temporary lay-offs

Talvivaara announced  on 16  January 2013  that to  support the  Group's  cost 
savings initiatives  and  overall  efficiency,  and to  adjust  the  level  of 
personnel  to  the  temporarily   suspended  ore  production,  Talvivaara   is 
considering  temporary  lay-offs.  Co-operation  consultations  with  employee 
representatives were  held  between 17  and  31 January  2013  concerning  all 
personnel groups in  all three corporate  entities, Talvivaara Mining  Company 
Plc, Talvivaara Sotkamo Ltd and Talvivaara Exploration Ltd.

Following the consultations,  Talvivaara decided  to temporarily  lay off  184 
employees between 18 February  and 30 June 2013.  The maximum duration of  the 
lay-off period was  90 days  per individual  employee (see  "Events after  the 
review period" for additional information on cancellation of temporarylay-offs
and re-start of ore production).

Shares and shareholders

The number of shares  issued and outstanding and  registered on the  Euroclear 
Shareholder Register as of 31 March 2013 was 272,309,640. Including the effect
of the EUR 85  million convertible bond  of 14 May 2008,  the EUR 225  million 
convertible bond of 16 December 2010, the Option Schemes of 2007 and 2011, the
authorised full number of shares of the Company amounted to 319,001,039.

The share subscription period for stock options 2007B is between 1 April  2011 
and 31 March 2013. No new shares  of Talvivaara were subscribed for under  the 
stock option rights 2007B in Q1 2013. A total of 2,284,337 stock option rights
2007B remained unexercised following  the end of  the subscription period  and 
expired.

A total of 2,327,000 option rights 2007C have been issued to employees and the
subscription period for  stock options 2007C  is between 1  April 2012 and  31 
March 2014. No new  shares of Talvivaara were  subscribed for under the  stock 
option rights 2007C in Q1  2013 and a total  of 2,327,000 stock options  2007C 
remain unexercised.

A total of 1,347,500 option rights 2011B have been issued to key employees and
the subscription period for stock options 2011B is between 1 April 2015 and 31
March 2017. A total of 1,347,500 stock options 2011B remain unexercised.

In March 2013 an  Extraordinary General Meeting  of Talvivaara Mining  Company 
resolved to approve the  proposal by the Board  of Directors to authorise  the 
Board of Directors to  undertake a share issue  for consideration pursuant  to 
the  shareholders'  pre-emptive  subscription  rights.  The  share  issue  was 
completed in April 2013, as described in "Events after the review period".

As at 31 March 2013, the shareholders who held more than 5% of the shares  and 
votes of Talvivaara were Pekka Perä (20.0%), Solidium Oy (8.9%), Varma  Mutual 
Pension Insurance  Company  (8.7%)  and  Ilmarinen  Mutual  Pension  Insurance 
Company (5.1%).

Events after the review period

Gypsum pond leakage

On 7 April 2013, Talvivaara detected a leakage at the gypsum pond of the mine.
The leakage was successfully  stemmed on 9 April  2013. All leakage water  was 
contained within the safety  dams in the mine  area, and Talvivaara  estimates 
that the total volume of water that escaped from the gypsum pond was less than
400,000 m3. The leakage water will be treated at the Southern water  treatment 
unit together with other excess waters, and following purification it will  be 
discharged into the environment. Talvivaara's  metals recovery plant was  shut 
down for approximately one week following the leak, while pumping arrangements
were being altered such that water purification capacity at the plant could be
maximized and  as  much  as  possible  of the  treated  water  could  also  be 
discharged  to  the  Northern  direction.   New  arrangements  for  the   safe 
utilization of the gypsum ponds following the leak were also implemented.

Completion of the rights issue

On 15 April 2013, Talvivaara announced  the final results of the rights  issue 
to raise approximately EUR  261 million in  gross proceeds. All  1,633,857,840 
new shares offered  in the  rights offering were  subscribed for.  A total  of 
1,419,673,290 shares  were subscribed  for  pursuant to  subscription  rights, 
representing 86.9% of all the offer shares. Taking into account  subscriptions 
received without subscription rights in the secondary subscription, the rights
offering  was  oversubscribed.  The  underwriting  provided  by  J.P.   Morgan 
Securities plc, Nordea Bank Finland Plc,  BofA Merrill Lynch, BNP PARIBAS  and 
Danske Bank  A/S,  Helsinki Branch  was  not  utilised. The  new  shares  were 
registered with the Finnish Trade Register  on 16 April 2013 and trading  with 
the shares commenced on 17 April 2013.

As a result of the rights offering,  the total number of shares in  Talvivaara 
increased to 1,906,167,480 shares. The offer shares carry the right to receive
dividends and  other distributions  of funds,  if any,  and other  shareholder 
rights in  Talvivaara as  of the  registration of  the offer  shares with  the 
Finnish Trade Register on 16 April 2013.

Cancellation of temporary lay-offs and re-start of mining

On 17  April  2013, Talvivaara  announced  the termination  of  the  temporary 
lay-offs it  had started  in  February 2013  in  order to  re-start  currently 
suspended mining  and  materials  handling operations  during  May  2013.  The 
Company will commence mining at the  Northern end of the Kuusilampi open  pit, 
where the water level has declined such that preparations for the re-start  of 
mining and crushing  operations can commence.  The open pit  will continue  to 
serve  as  water  management  safety  capacity  despite  the  commencement  of 
preparations for re-starting mine production.

The re-start of ore production approximately 1.5 months in advance of  earlier 
plans improves the overall  water balance of  the mine, as  new ore absorbs  a 
significant amount of water, approximately 10-15% of ore mass, at the stacking
phase. Adding new ore  to the leaching process  earlier than anticipated  also 
supports the achievement of the Company's production targets and the  progress 
of ramp-up in accordance with plans.

The cancellation of the temporary lay-offs impacts 184 employees. Over half of
the planned lay-offs had been carried out since February, as approximately 121
employees were temporarily laid off during February - April.

Short-term outlook

Operational outlook

Talvivaara continues to anticipate  producing approximately 18,000t of  nickel 
and 39,000t of zinc in 2013. Metals production will continue to be impacted by
water balance issues in the first half of the year, but is expected to  return 
to a clear ramp-up during the remainder of the year driven by the re-start  of 
ore production  in  May,  approximately 1.5  months  earlier  than  previously 
anticipated.

Market outlook

The LME nickel price  reached a level of  USD 18,000-19,000/t in late  January 
and early February, driven  by encouraging macroeconomic  trends in China  and 
globally as  well  as  abating  concerns  over  the  European  sovereign  debt 
situation. However, the nickel price declined  back to around USD 16,000/t  by 
early April. Concerns over stainless steel utilisation rates and the  build-up 
of global nickel inventories have weighed  on the nickel price, as LME  nickel 
inventories reached  a record  high of  around 170,000t  in April.  Talvivaara 
expects nickel  price  volatility to  remain  elevated and  the  current  high 
inventory levels and global economic uncertainty to limit the price upside  in 
the near term.

In the longer term,  Talvivaara foresees the  nickel industry fundamentals  to 
support favourable  nickel price  development, driven  by increasing  marginal 
cost of production across the nickel industry and lack of new committed nickel
projects to  replace depleting  supply after  the next  few years.  Talvivaara 
continues to see  the longer  term nickel price  support level  at around  USD 
20,000/t.

24 April 2012

Talvivaara Mining Company Plc.
Board of Directors

CONSOLIDATED INCOME STATEMENT
                                                           Unaudited Unaudited
                                                               three     three
                                                           months to months to
(all amounts in EUR '000)                                  31 Mar 13 31 Mar 12
Net sales                                                     27,605    39,027
Other operating income                                           729     1,357
Changes in inventories of finished goods and work in
progress                                                       7,288    22,478
Materials and services                                      (22,614)  (34,921)
Personnel expenses                                           (7,285)   (7,819)
Depreciation, amortization, depletion and impairment
charges                                                     (13,099)  (12,664)
Other operating expenses                                    (12,612)  (18,889)
Operating profit (loss)                                     (19,988)  (11,431)
Finance income                                                   339     1,717
Finance cost                                                (12,080)   (9,646)
Finance income (cost) (net)                                 (11,741)   (7,929)
Profit (loss) before income tax                             (31,729)  (19,360)
Income tax expense                                             7,797     4,451
Profit (loss) for the period                                (23,932)  (14,909)
Attributable to:
Owners of the parent                                        (24,865)  (13,561)
Non-controlling interest                                         933   (1,348)
                                                           (23,932)  (14,909)
Earnings per share for profit (loss) attributable to the
owners of the parent (expressed in EUR per share)
Basic and diluted                                             (0.09)    (0.06)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME   
                                       Unaudited Unaudited
                                           three     three
                                       months to months to
(all amounts in EUR '000)              31 Mar 13 31 Mar 12
Profit (loss) for the period            (23,932)  (14,909)
Other comprehensive income, net of tax         -         -
Total comprehensive income              (23,932)  (14,909)
Attributable to:
Owners of the parent                    (24,865)  (13,561)
Non-controlling interest                     933   (1,348)
                                       (23,932)  (14,909)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION          
                                           Unaudited   Audited
(all amounts in EUR '000)                   31 Mar 13 31 Dec 12
ASSETS
Non-current assets
Property, plant and equipment                 813,604   809,452
Biological assets                               8,894     9,125
Intangible assets                               7,021     7,014
Investments in associates                       6,180     5,694
Deferred tax assets                            61,340    52,588
Other receivables                               4,979     2,940
Available-for-sale financial assets                 2         2
                                             902,020   886,815
Current assets
Inventories                                 306,463   297,761
Trade receivables                              22,400    32,174
Other receivables                               7,406     7,980
Cash and cash equivalent                       68,691    36,058
                                             404,960   373,973
Total assets                                1,306,980 1,260,788
EQUITY AND LIABILITIES
Equity attributable to owners of the parent
Share capital                                      80        80
Share issue                                    49,463         -
Share premium                                   8,086     8,086
Other reserves                                542,255   539,559
Retained earnings                           (278,081) (251,365)
                                             321,803   296,360
Non-controlling interest in equity             11,325    10,392
Total equity                                  333,128   306,752
Non-current liabilities
Borrowings                                    505,044   506,028
Advance payments                              272,881   265,847
Other payables                                    239       228
Provisions                                     11,395    11,290
                                             789,559   783,393
Current liabilities
Borrowings                                     93,710    93,793
Advance payments                               19,027     7,857
Trade payables                                 26,088    25,577
Other payables                                 35,089    27,178
Provisions                                     10,379    16,238
                                             184,293   170,643
Total liabilities                             973,852   954,036
Total equity and liabilities                1,306,980 1,260,788

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
A Share capital
B Share issue
C Share premium
D Invested unrestricted equity
E Other reserves
F Retained earnings
G Total
H Non-controlling interest
I Total equity

(all amounts in
EUR '000)       A    B      C      D      E        F        G        H     I
1 Jan 12                                                                  322,
                80    278 8,086 404,070 45,462 (151,129)  306,847  15,733  580
Profit (loss)                                                             (14,
for the period   -      -     -       -      -  (13,561) (13,561) (1,348) 909)
Other
comprehensive
income
- Other
comprehensive
income           -      -     -       -      -         -        -       -    -
Total
comprehensive
income for the                                                            (14,
period           -      -     -       -      -  (13,561) (13,561) (1,348) 909)
Transactions
with owners
Stock options    -  (278)     -     579      -         -      301       -  301
Perpetual
capital loan     -      -     -       -  2,353   (1,777)      576     109  685
                                                                           81,
Share issue      -      -     -  81,534      -         -   81,534       -  534
Incentive
arrangement for
Executive
Management       -      -     -       -     23         -       23       -   23
Employee share
option scheme
- value of
employee                                                                    1,
services         -      -     -       -  1,106         -    1,106       -  106
Total
contribution by
and
distribution to                                                            83,
owners           -  (278)     -  82,113  3,482   (1,777)   83,540     109  649
Total
transactions                                                               83,
with owners      -  (278)     -  82,113  3,482   (1,777)   83,540     109  649
31 Mar 12                                                                 391,
                80      - 8,086 486,183 48,944 (166,467)  376,826  14,494  320
31 Dec 12                                                                 306,
                80      - 8,086 490,749 48,810 (251,365)  296,360  10,392  752
1 Jan 13                                                                  306,
                80      - 8,086 490,749 48,810 (251,365)  296,360  10,392  752
Profit (loss)                                                             (23,
for the period   -      -     -       -      -  (24,865) (24,865)     933 932)
Other
comprehensive
income
- Other
comprehensive
income           -      -     -       -      -         -        -       -    -
Total
comprehensive
income for the                                                            (23,
period           -      -     -       -      -  (24,865) (24,865)     933 932)
Transactions
with owners
Perpetual
capital loan     -      -     -       -  2,612   (1,851)      761       -  761
                                                                           49,
Rights issue     - 49,463     -       -      -         -   49,463       -  463
Incentive
arrangement for
Executive
Management       -      -     -       -     23         -       23       -   23
Employee share
option scheme
- value of
employee
services         -      -     -       -     61         -       61       -   61
Total
contribution by
and
distribution to                                                            50,
owners           - 49,463     -       -  2,696   (1,851)   50,308       -  308
Total
transactions                                                               50,
with owners      - 49,463     -       -  2,696   (1,851)   50,308       -  308
31 Mar 13                                                                 333,
                80 49,463 8,086 490,749 51,506 (278,081)  321,803  11,325  128

CONSOLIDATED STATEMENT OF CASH FLOWS
                                                           Unaudited Unaudited
                                                               three     three
                                                           months to months to
(all amounts in EUR '000)                                  31 Mar 13 31 Mar 12
Cash flows from operating activities
Profit (loss) for the period                                (23,932)  (14,909)
Adjustments for
Tax                                                          (7,797)   (4,451)
Depreciation and amortization                                 13,099    12,664
Other non-cash income and expenses                          (10,156)   (5,785)
Interest income                                                (339)   (1,717)
Fair value gains on financial assets at fair value through
profit or loss                                                     -       (5)
Interest expense                                              12,080     9,646
                                                           (17,045)   (4,557)
Change in working capital
Decrease(+)/increase(-) in other receivables                   8,291    14,707
Decrease (+)/increase (-) in inventories                     (8,702)  (27,825)
Decrease(-)/increase(+) in trade and other payables          (4,305)  (12,558)
Change in working capital                                    (4,716)  (25,676)
                                                           (21,761)  (30,233)
Interest and other finance cost paid                           (310)     (841)
Interest and other finance income                                213       225
Net cash generated (used) in operating activities           (21,858)  (30,849)
Cash flows from investing activities
Investments in associates                                      (486)         -
Purchases of property, plant and equipment                  (17,085)  (14,571)
Purchases of biological assets                                  (52)         -
Purchases of intangible assets                                 (176)      (93)
Proceeds from sale of property, plant and equipment                -        18
Proceeds from sale of biological assets                           92         -
Purchases of available-for-sale financial assets                      (3,571)
Net cash generated (used) in investing activities           (17,707)  (18,217)
Cash flows from financing activities
Proceeds from share issue net of transactions costs           54,035    81,177
Realised stock options                                             -       301
Proceeds from interest-bearing liabilities                         -    20,000
Proceeds from advance payments                                19,480     1,787
Payment of interest-bearing liabilities                      (1,317)   (8,269)
Net cash generated (used) in financing activities             72,198    94,996
Net increase (decrease) in cash and cash equivalents          32,633    45,930
Cash and cash equivalents at beginning of the period          36,058    40,019
Cash and cash equivalents at end of the period                68,691    85,949

NOTES

1. Basis of preparation

This interim report has been prepared in compliance with IAS 34.

The interim financial information set out herein has been prepared on the same
basis and using the same accounting policies as were applied in drawing up the
Group's statutory financial statements for the year ended 31 December 2012.

2. Property, plant and
equipment
                           Machinery Construction   Land     Other
                              and         in         and    tangible
(all amounts in EUR '000)  equipment   progress   buildings  assets    Total
Gross carrying amount at 1
Jan 13                       376,741      114,378   281,209  229,479 1,001,807
Additions                         82       16,995         8        -    17,085
Transfers                      8,148     (12,699)       695    3,856         -
Gross carrying amount at
31 Mar 13                    384,971      118,674   281,912  233,335 1,018,892
Accumulated depreciation
and
impairment losses at 1 Jan
13                            96,677            -    44,918   50,760   192,355
Depreciation for the
period                         7,666            -     3,151    2,116    12,933
Accumulated depreciation
and
impairment losses at 31
Mar 13                       104,343            -    48,069   52,876   205,288
Carrying amount at 1 Jan
13                           280,064      114,378   236,291  178,719   809,452
Carrying amount at 31 Mar
13                           280,628      118,674   233,843  180,459   813,604

3. Trade receivables
(all amounts in EUR '000)
                         31 Mar 13 31 Dec 12
Nickel-Cobalt sulphide       16,459    25,254
Zinc sulphide                 5,941     6,912
Copper sulphide                   -         8
Total trade receivables      22,400    32,174

4. Inventories
(all amounts in EUR '000)
                             31 Mar 13 31 Dec 12
Raw materials and consumables    22,491    21,077
Work in progress                280,148   272,775
Finished products                 3,824     3,909
Total inventories               306,463   297,761

5. Borrowings
(all amounts in EUR '000)
Non-current                                 31 Mar 13 31 Dec 12
Capital loans                                   1,405     1,405
Investment and Working Capital loan            51,642    51,600
Senior Unsecured Bonds due 2017               108,745   108,683
Revolving Credit Facility                      69,539    69,451
Senior Unsecured Convertible Bonds due 2015   228,157   225,875
Finance lease liabilities                      28,608    30,748
Other                                          16,948    18,266
                                             505,044   506,028
Current
Investment and Working Capital loan             6,430     6,430
Senior Unsecured Convertible Bonds due 2013    76,503    75,805
Finance lease liabilities                      10,777    11,558
                                              93,710    93,793
Total borrowings                              598,754   599,821

6. Advance payments
(all amounts in EUR '000)
Non-current                    31 Mar 13 31 Dec 12
Deferred zinc sales revenue      218,953   219,385
Deferred uranium sales revenue    53,928    46,462
                                272,881   265,847
Current
Deferred zinc sales revenue       19,014     7,790
Other                                 13        67
                                 19,027     7,857
Total advance payments           291,908   273,704

7. Provisions                                                        
                         Gypsum      Water
                          pond      balance     Environmental  Mining
                       leakage    management    restoration    fee    Total
31 Dec 12                 12,156          9,082          6,136    154  27,528
Charged/(credited) to
the income statement:   
Additional provisions          -              -             88      9      97
Unwinding of discount          -              -              8      -       8
Used during the period   (3,535)        (2,324)              -      - (5,859)
31 Mar 13                  8,621          6,758          6,232    163  21,774
The non-current and current portions of provisions are as follows:
                                             31 Mar 13  31 Dec 12
Non-current
Gypsum pond leakage                               5,000      5,000
Environmental restoration                         6,232      6,136
Mining fee                                          163        154
                                                11,395     11,290
Current
Gypsum pond leakage                               3,621      7,156
Water balance management                          6,758      9,082
                                                10,379     16,238
Total                                            21,774     27,528
                                                              

8. Changes in the number of shares issued 
                                         Number of shares
31 Dec 12                                      272,309,640
Changes                                                  -
31 Mar 13                                      272,309,640

9. Contingencies and commitments
(all amounts in EUR '000)
The future aggregate minimum lease payments under non cancellable
operating leases
                                             31 Mar 13 31 Dec 12
Not later than 1 year                             1,825     1,910
Later than 1 year and not later than 5 years        882     1,036
Later than 5 years                                   47        47
                                                 2,754     2,993

Capital commitments

At 31 March  2013, the  Group had capital  commitments amounting  to EUR  13.1 
million (31  December 2012:  EUR  15.1 million)  principally relating  to  the 
completion of the Talvivaara mine, improving the reliability and expansion  of 
production  capacity.  These  commitments  are  for  the  acquisition  of  new 
property, plant and equipment.

Key financial figures of the Group
                                                     Three     Three    Twelve
                                                 months to months to months to
                                               31 Mar 13 31 Mar 12 31 Dec 12
Net sales                               EUR '000    27,605    39,027   142,948
Operating profit (loss)                 EUR '000  (19,988)  (11,431)  (83,588)
Operating profit (loss) percentage                -72.4 %   -29.3 %   -58.5 %
Profit (loss) before tax                EUR '000  (31,729)  (19,360) (129,292)
Profit (loss) for the period            EUR '000  (23,932)  (14,909) (103,911)
Return on equity                                   -7.5 %    -4.2 %   -33.0 %
Equity-to-assets ratio                             25.5 %    31.8 %    24.3 %
Net interest-bearing debt               EUR '000   530,063   422,235   563,763
Debt-to-equity ratio                              159.1 %   107.9 %   183.8 %
Return on investment                               -1.3 %    -0.6 %    -6.7 %
Capital expenditure                     EUR '000    17,313    14,664    97,451
Property, plant and equipment           EUR '000   813,604   765,652   809,452
Borrowings                              EUR '000   598,754   508,184   599,821
Cash and cash equivalents at the end of
the period                              EUR '000    68,691    85,949    36,058

Share-related key figures                                       
                                                 Three       Three      Twelve
                                             months to   months to   months to
                                           31 Mar 13   31 Mar 12   31 Dec 12
Earnings per share                     EUR      (0.09)      (0.06)      (0.38)
Equity per share^1                     EUR        1.00        1.51        1.11
Development of share price at
London Stock Exchange
Average trading price^2                EUR        0.53        3.53        2.50
                                      GBP        0.45        2.94        2.02
Lowest trading price^2                 EUR        0.21        2.82        1.03
                                      GBP        0.18        2.35        0.83
Highest trading price^2                EUR        1.33        4.30        4.43
                                      GBP        1.14        3.59        3.59
Trading price at the end of
the period^3                           EUR        0.25        2.89        1.25
                                      GBP        0.21        2.41        1.02
Change during the period                      -79.7 %      20.4 %     -48.8 %
Price-earnings ratio                             neg.        neg.        neg.
Market capitalization at the
end of the period^4               EUR '000      66,821     781,369     341,597
                                 GBP '000      56,504     651,584     278,777
Development in trading volume
Trading volume                 1000 shares      42,435      37,271     103,218
In relation to weighted
average number of shares                       15.6 %      14.9 %      38.7 %
Development of share price at
OMX Helsinki
Average trading price                  EUR        0.63        3.51        2.31
Lowest trading price                   EUR        0.22        2.64        1.08
Highest trading price                  EUR        1.39        4.35        4.35
Trading price at the end of
the period                             EUR        0.23        2.91        1.24
Change during the period                      -81.7 %      16.7 %     -50.2 %
Price-earnings ratio                             neg.        neg.        neg.
Market capitalization at the
end of the period                 EUR '000      61,814     786,880     338,209
Development in trading volume
Trading volume                 1000 shares     113,082      68,673     209,565
In relation to weighted
average number of shares                       41.5 %      27.5 %      78.5 %
Adjusted average number of
shares                                    272,309,640 249,665,643 266,846,084
Fully diluted average number
of shares                                 271,205,640 249,665,643 265,742,084
Number of shares at the end of
the period                                272,309,640 270,591,300 272,309,640

^1) The funds entered into share issue reserve are not included in the
calculation.
^2) Trading price is calculated on the average of EUR/GBP exchange rates
published by the European Central Bank during the period.
^3) Trading price is calculated on the EUR/GBP exchange rate published by the
European Central Bank at the end of the period.
^4) Market capitalization is calculated on the EUR/GBP exchange rate published
by the European Central Bank at the end of the period.

Employee-related key figures                                      
                                                     Three     Three    Twelve
                                                 months to months to months to
                                               31 Mar 13 31 Mar 12 31 Dec 12
Wages and salaries                      EUR '000     6,031     6,581    23,080
Average number of employees                           586       483       547
Number of employees at the end of the
period                                                583       498       588

Other figures                                                      
                                                     Three     Three    Twelve
                                                 months to months to months to
                                                31 Mar 13 31 Mar 12 31 Dec 12
Share options outstanding at the end of the
period                                           3,674,500 4,665,064 5,958,837
Number of shares to be issued against the
outstanding share options                        3,674,500 4,665,064 5,958,837
Rights to vote of shares to be issued against
the outstanding share options                        1.3 %     1.7 %     2.1 %

Talvivaara Mining Company Plc
Key financial figures of the Group
                         
Return on equity          Profit (loss) for the period
                          (Total equity at the beginning of period + Total
                         equity at the end of period)/2
                         
Equity-to-assets ratio    Total equity
                          Total assets
                          
Net interest-bearing debt Interest-bearing debt - Cash and cash equivalent
                         
Debt-to-equity ratio      Net interest-bearing debt
                          Total equity
                          
Return on investment      Profit (loss) for the period + Finance cost
                          (Total equity at the beginning of period + Total
                          equity at the end of period)/2 + (Borrowings at the
                          beginning of period + Borrowings at the end of
                          period)/2
Share-related key figures

                          Profit (loss) attributable to equity holders of the
Earnings per share        Company
                          Adjusted average number of shares
                          
Equity per share          Equity attributable to equity holders of the Company
                         Adjusted average number of shares

Talvivaara Interim Report Jan-Mar 2013 24.4.2013

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Source: Talvivaaran Kaivososakeyhtiö Oyj via Thomson Reuters ONE
HUG#1695638