Uranium

NYSEMKT:UUUU

Energy Fuels Inc. (TSX:EFR,NYSEMKT:UUUU) announced its financial results for the quarter ended March 31, 2016.

Energy Fuels Inc. (TSX:EFR,NYSEMKT:UUUU) announced its financial results for the quarter ended March 31, 2016.
As quoted in the press release:

Financial Highlights for the Quarter-Ended March 31, 2016:

  • $18.0 million of total revenue was realized by the Company.
  • Gross Profit of $5.9 million from mining and milling operations was realized by the Company, representing a gross profit margin of approximately 33%.
  • 350,000 pounds of U3O8 sales were completed by the Company at an average realized price of $51.36 per pound. 300,000 pounds of sales were pursuant to long-term contracts at an average price of $54.19 per pound and 50,000 pounds of sales were sold to a utility at the then-prevailing spot price of $34.40 per pound.
  • At March 31, 2016, the Company had $37.5 million of working capital, including cash and cash equivalents of $16.5 million and approximately 225,000 pounds of uranium concentrate inventory. In addition, at March 31, 2016, the Company had $8.3 millionreceivable pursuant to a uranium sale made on March 15, 2016. The Company subsequently received the cash for this receivable in April 2016.
  • A net loss of $8.8 million was realized by the Company, primarily as a result of $7.4 million of investments we are making in future production, including completion of the elution circuit at Nichols Ranch, continued shaft-sinking and resource evaluation at the Canyon Project, and construction of new leach tanks at the White Mesa Mill.
  • 85,000 pounds of U3O8 were recovered by the Company, all of which came from the Nichols Ranch Project.

Development Highlights for the Quarter-Ended March 31, 2016:

  • Shaft-sinking operations continue at the Canyon Project. The shaft, which is expected to be constructed to a total depth of 1,470 feet, is at a depth of approximately 900 feet as of April 30, 2016. Underground drilling to further evaluate the Canyon deposit is expected to occur in mid-2016, when the shaft reaches a depth of approximately 1,000 feet.
  • The Company completed construction and licensing of the elution circuit at the Nichols Ranch Project in February 2016. Energy Fuels now has 100% self-contained ISR processing capabilities, which is expected to significantly lower the Company’s future costs of production on a per pound basis by avoiding 3rd party toll processing fees.

Energy Fuels President and CEO, Stephen P. Antony, stated:

While the price of uranium has disappointed so far in 2016, Energy Fuels continues to pursue efforts aimed at lowering operating and other costs, while also advancing our long-term ability to ramp-up mineral extraction activities in the future. We continue to adjust our business plan to appropriately respond to uranium prices that are near multi-year lows today, but expected to rise significantly over the long-term. As such, we have made the decision to save significant cash in 2016 by planning to delay previously announced capital expenditures, including wellfield expansion at Nichols Ranch. While this decision is expected to lower production at Nichols Ranch by 50,000 pounds this year, White Mesa Mill uranium recoveries are now expected to be higher than originally forecast. Therefore, we are maintaining our previous guidance of 950,000 total pounds of uranium recovery in 2016.
We continue to pursue shaft-sinking and resource evaluation activities at our Canyon Project in Arizona, and later in the year, we hope to announce positive results at this low-cost project. Finally, we expect to lower our portfolio-wide cost of production upon the closing of our pending acquisition of Mesteña Uranium, and its ISR production in South Texas. While long-term uranium market pricing is currently lower than the pricing contained in our four existing contracts, upon only a modest uplift in current long-term prices, Mesteña will provide Energy Fuels with the potential to sign uranium sales contracts which meet targeted operating margins for the Company. As a result, Mesteña is a key acquisition for Energy Fuels as we navigate today’s challenging uranium markets.

Connect with Energy Fuels Inc. (TSX:EFR,NYSEMKT:UUUU) to receive an Investor Presentation.

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