Paladin Energy Ltd Releases Financial Report for the Six Months Ended 31 December 2015, Outlook and CEO Appointment

Paladin Energy Ltd (ASX: PDN, TSX:PDN) announced the release of its Unaudited Consolidated Financial Report for the six months ended 31 December 2015. The Unaudited Consolidated Financial Report is appended to this News Release.
Highlights include:

Operations

• Langer Heinrich Mine (LHM) produced¹1.259Mlb U₃O₈for the three months ended 31 December 2015, up 16% from the September 2015 quarter.
• C1 unit cash cost of production²for the December 2015 quarter of US$25.38/lb (vs. guidance of US$25.00/lb to US$27.00/lb), a decrease of 9% from US$27.82/lb in the September 2015 quarter.
• Record monthly C1 cash cost achieved during the month of December 2015 of US$23.73/lb and continuation of low C1 cash cost running rate in January 2016 of US$24.36/lb.

Sales and revenue

• Sales revenue of US$64.4M for the three months ended 31 December 2015, selling 1.699Mlb U₃O₈.
• Average realised uranium sales price for the quarter was US$37.90/lb U₃O₈compared to the average TradeTech weekly spot price for the quarter of US$36.03/lb U₃O₈.

Corporate

• Underlying EBITDA³for the three months ended 31 December 2015 of US$10.6M, a US$17.2M turnaround from a negative underlying EBITDA of US$6.6M for the three months ended 31 December 2014.
• Underlying all-in cash expenditure⁴per pound of uranium production for the three months ended 31 December 2015 of US$39.58/lb, a decrease of 14% compared to the three months ended 30 September 2015 of US$46.25/lb.
• Repurchased an additional US$17M of Convertible Bonds due April 2017 to reduce outstanding amount to US$237M.
• Cash and cash equivalents at 31 December 2015 of US$136.8M (an increase of US$28.4M from 30 September 2015 and better vs. guidance pro-forma US$122.5M to US$132.5M after adjusting for the additional repurchase of Convertible Bonds due in April 2017 and sales proceeds from the last physical delivery of the quarter).

Outlook

• Upgrade / update to key elements of FY2016 guidance:
  • LHM production 5.0Mlb to 5.2Mlb U₃O₈(vs. previous range 5.0Mlb to 5.4Mlb).
  • Weighted average sales price premium to spot of approximately US$4/lb (no change).
  • LHM C1 cash costs in the range of US$24/lb to US$26/lb (i.e., reduction of US$1/lb vs. previous range of US$25/lb to US$27/lb).
• Lower C1 cash costs at LHM combined with non-LHM costs being within guidance is resulting in reduced ‘all in’ cash expenditure levels for the Company. Running rate for second half of FY2016 is expected to be in the range of US$35/lb to US$37/lb, which would result in full-year FY2016 range of US$38/lb to US$40/lb (vs. previously presented US$39/lb to US$41/lb).
• Company continues to be on track to be cash flow neutral⁵on an ‘all in’ basis at current spot uranium price and foreign exchange rates excluding one-off restructuring costs and capital management or strategic initiatives for FY2016 full-year.
• Key elements of guidance for quarter to 31 March 2016 include:
  • Uranium sales in the range of 450,000lb to 650,000lb.
  • C1 cash costs in the range of US$23/lb to US$25/lb.
  • Quarter-end cash balance in the range of US$100M to US$110M.

Paladin CEO

• Alexander Molyneux has been appointed CEO following his six-month engagement as Interim CEO.

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