PolyMet Reports Second Quarter Fiscal 2017 Results

ST. PAUL, MINNESOTA -- (Marketwired) -- 09/15/16 -- PolyMet Mining Corp. (TSX: POM)(NYSE MKT: PLM) - today reported that it has filed its financial results for the three and six months ended July 31, 2016. PolyMet and Glencore AG, a wholly owned subsidiary of Glencore plc (together "Glencore"), have also agreed to extend the maturity of the existing loans. PolyMet controls 100 percent of the development-stage NorthMet copper-nickel-precious metals ore body and the nearby Erie Plant, located near Hoyt Lakes in the established mining district of the Mesabi Iron Range in northeastern Minnesota.

The financial statements have been filed at www.polymetmining.com 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 e-mail at [email protected].

Highlights of Fiscal 2017 to-date

--  On March 3, 2016, the state determined that the NorthMet Final
    Environmental Impact Statement addresses the objectives defined in the
    EIS scoping review, meets procedural requirements and responds
    appropriately to public comments. The 30-day period allowed by law to
    challenge the state's decision passed without any legal challenge being
    filed. The Final EIS demonstrates that the NorthMet Project can be
    constructed and operated in compliance with environmental and human
    health standards;
--  On June 2, 2016, the Company agreed to issue up to an additional $14.0
    million secured debentures to Glencore to fund permitting and general
    corporate purposes. The debentures are on similar terms as the existing
    non-convertible senior secured Tranche F-J Debentures;
--  Repayment of $4.0 million initial principal loan from the Iron Range
    Resources and Rehabilitation Board;
--  On July 11, 2016, the Company submitted applications for water-related
    permits required to construct and operate NorthMet;
--  On July 12, 2016, the Eastern Region Regional Office of the U.S. Forest
    Service issued its response to comments on the draft Record of Decision
    on the land exchange and instructed the Superior National Forest to
    proceed with completing the final ROD;
--  On August 2, 2016, the Company renewed its request for Water Quality
    Certification under Section 401 of the Clean Water Act;
--  On August 24, 2016, the Company submitted the air quality permit
    application required to construct and operate NorthMet;
--  On September 14, 2016, Glencore AG agreed to extend the term of $39.757
    million of outstanding secured convertible and $62.010 million
    outstanding secured non-convertible debentures (including interest
    accrued through September 14, 2016) to March 31, 2018, repayable at any
    time if it is prudent to do so.
--  Loss for the three months ended July 31, 2016, was $1.555 million
    compared with $1.698 million for the prior year period. General and
    administrative expenses for the three months ended July 31, 2016,
    excluding non-cash share-based compensation, were $0.945 million
    compared with $1.041 million for the prior year period. Other expenses
    were $0.377 million compared with $0.530 million for the prior year
    period;
--  Loss for the six months ended July 31, 2016, was $3.907 million compared
    with $5.256 million for the prior year period. General and
    administrative expenses for the six months ended July 31, 2016,
    excluding non-cash share-based compensation, were $2.158 million
    compared with $2.258 million for the prior year period. Other expenses
    were $0.889 million compared with $2.745 million for the prior year
    period, which included a one-time non-cash loss of $1.852 million on the
    disposal of wetland credit intangibles;
--  At July 31, 2016, the Company had cash of $2.294 million compared with
    $10.256 million at January 31, 2016. Subsequent to July 31, 2016, the
    Company received $3.000 million with the issuance of the Tranche M
    Debenture. At July 31, 2016, short-term debt totaled $38.960 million
    senior secured convertible debt and $57.719 million non-convertible
    debt;
--  PolyMet invested $4.553 million cash into its NorthMet Project during
    the three months ended July 31, 2016, compared with $8.078 million in
    the prior year period, and invested $11.411 million during the six
    months ended July 31, 2016, compared with $13.884 million in the prior
    year period; and
--  As of July 31, 2016, PolyMet had spent $111.1 million on environmental
    review and permitting, of which $104.7 million has been spent since the
    NorthMet Project moved from exploration to development stage.

Goals and Objectives for the Next Twelve Months

The environmental review and permitting process is managed by the regulatory agencies and, therefore, timelines are not within PolyMet's control. Given these circumstances, PolyMet's objectives include:

--  U.S. Forest Service issuance of its final ROD on the proposed land
    exchange and transfer of title to the surface rights over and around the
    NorthMet mineral rights to PolyMet;
--  Decision on 401 Water Quality Certification and 404 Wetlands final ROD
    under the Clean Water Act;
--  Submission of remaining major state permit applications and decisions on
    permit issuance;
--  Completion of Definitive Cost Estimate and Project Update following
    permits;
--  Completion of project implementation plan;
--  Repayment, restructuring, and/or conversion of Glencore loans; and
--  Completion of construction finance plan including commitment of debt
    prior to the issuance of permits, subject to typical conditions
    precedent such as receipt of key permits.

Key Statistics

(in '000 US dollars, except per share amounts)
----------------------------------------------------------------------------

Balance Sheet                                July 31, 2016  January 31, 2016
                                            --------------------------------

Cash                                           $     2,294       $    10,256
Pro Forma working capital deficit (see note)        (2,272)            2,162
Total assets                                       354,894           337,660
Total liabilities                                  172,617           153,003
Shareholders' equity                               182,277           184,657
----------------------------------------------------------------------------
Note: the working capital deficit is pro forma reflecting extension of the
 due date of $38.960 million secured convertible debentures and $57.719
 million of secured non-convertible debentures to the earlier of March 31,
 2018, the availability of at least $125 million of financing, or when it is
 prudent for PolyMet to repay the debt.

                      Three months ended             Six months ended
Income Statement           July 31,                      July 31,
                 -----------------------------------------------------------
                          2016           2015           2016           2015
                 -----------------------------------------------------------
General &
 administrative
 expense
 excluding non-
 cash share-based
 compensation     $        945   $      1,041        $ 2,158   $      2,258
Non-cash share-
 based
 compensation              233            127            860            253
Other Expenses
  Finance & Other          377            530            889            893
  Non-cash loss
   on disposal of
   Intangibles               -              -              -          1,852
                 -----------------------------------------------------------
                 -----------------------------------------------------------
Loss before tax   $      1,555   $      1,698        $ 3,907   $      5,256
Other
 Comprehensive
 (Income)         $        (48)  $        (59)  $       (104)         $ (75)
                 -----------------------------------------------------------
                 -----------------------------------------------------------
  Loss per share  $       0.01   $       0.01   $       0.01   $       0.02
----------------------------------------------------------------------------
Investing
 Activities:
  NorthMet
   Property       $      4,553   $      8,078   $     11,411   $     13,884
----------------------------------------------------------------------------
Weighted average
 shares
 outstanding       277,735,782    276,521,018    277,707,740    276,496,063

About PolyMet

PolyMet Mining Corp. (www.polymetmining.com) is a publicly-traded mine development company that owns 100 percent of Poly Met Mining, Inc., a Minnesota corporation that controls 100 percent of the NorthMet copper-nickel-precious metals ore body through a long-term lease and owns 100 percent of the Erie Plant, a large processing facility located approximately six miles from the ore body in the established mining district of the Mesabi Iron Range in northeastern Minnesota. Poly Met Mining, Inc. has completed its Definitive Feasibility Study. The NorthMet Final EIS was published in November 2015, preparing the way for decisions on permit applications. NorthMet is expected to require approximately two million hours of construction labor, creating approximately 360 long-term jobs, a level of activity that will have a significant multiplier effect in the local economy.

POLYMET MINING CORP.

Jon Cherry, CEO

PolyMet Disclosures

This news release contains certain forward-looking statements concerning anticipated developments in PolyMet's operations in the future. Forward-looking statements are frequently, but not always, identified by words such as "expects," "anticipates," "believes," "intends," "estimates," "potential," "possible," "projects," "plans," and similar expressions, or statements that events, conditions or results "will," "may," "could," or "should" occur or be achieved or their negatives or other comparable words. These forward-looking statements may include statements regarding the ability to receive environmental and operating permits, job creation, or other statements that are not a statement of fact. Forward-looking statements address future events and conditions and therefore involve inherent known and unknown risks and uncertainties. Actual results may differ materially from those in the forward-looking statements due to risks facing PolyMet or due to actual facts differing from the assumptions underlying its predictions.

PolyMet's forward-looking statements are based on the beliefs, expectations and opinions of management on the date the statements are made, and PolyMet does not assume any obligation to update forward-looking statements if circumstances or management's beliefs, expectations and opinions should change.

Specific reference is made to PolyMet's most recent Annual Report on Form 20-F for the fiscal year ended January 31, 2016 and in our other filings with Canadian securities authorities and the U.S. Securities and Exchange Commission, including our Report on Form 6-K providing information with respect to our operations for the three months ended July 31, 2016, for a discussion of some of the risk factors and other considerations underlying forward-looking statements.

The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

Contacts:
PolyMet Mining Corp. - Media:
Bruce Richardson
Corporate Communications
+1 (651) 389-4111
[email protected]

PolyMet Mining Corp. - Investor Relations:
Jenny Knudson
Investor Relations
+1 (651) 389-4110
[email protected]
www.polymetmining.com

Source: PolyMet Mining Corp.

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