Uranium One Announces 18% Increase in Q2 2013 Production to 3.6 Million
Pounds; Average Total Cash Cost of $19 per Pound
TORONTO, Aug. 6, 2013 /CNW/ - Uranium One Inc. ("Uranium One") today reported
quarterly revenue of $123.0 million for Q2 2013, including joint venture
revenue, based on sales of 2.9 million pounds at an average realized sales
price of $43 per pound at an average total cash cost per pound sold of $19.
Q2 2013 Highlights
-- Total attributable production during Q2 2013 was 3.6 million
pounds, 18% higher than total attributable production of 3.0
million pounds during Q2 2012.
-- The average total cash cost per pound sold was $19 per pound
for Q2 2013, compared to $16 per pound for Q2 2012.
-- Attributable sales volumes for Q2 2013 were 2.9 million pounds
sold from the Corporation's operations and joint ventures
compared to 1.9 million pounds sold during Q2 2012.
-- Revenue was $11.9 million in Q2 2013, compared to $13.0 million
in Q2 2012.
-- Joint venture revenue in Q2 2013 was $111.1 million, compared
to $83.8 million in Q2 2012.
-- The average realized sales price during Q2 2013 was $43 per
pound, compared to $51 per pound in Q2 2012. The average spot
price in Q2 2013 was $40 per pound compared to $51 per pound in
-- Earnings from mine operations were $5.1 million in Q2 2013,
compared to $3.1 million in Q2 2012.
-- Earnings from mine operations, including earnings from joint
ventures, were $31.1 million in Q2 2013, a 22% decrease
compared to earnings from mine operations, including joint
ventures, of $40.1 million in Q2 2012.
-- The net earnings for Q2 2013 were $10.6 million or $0.01 per
share, compared to net earnings of $29.2 million or $0.03 per
share for Q2 2012.
-- The adjusted net earnings for Q2 2013 were $7.0 million or
$0.01 per share, compared to adjusted net earnings of $8.4
million or $0.01 per share for Q2 2012.
-- On January 13, 2013, the Corporation entered into a definitive
agreement with ARMZ under which the Corporation would be taken
private pursuant to a Plan of Arrangement. ARMZ and its
affiliates currently own 51.4% of the Corporation's outstanding
common shares. Under the agreement, ARMZ will acquire all of
the remaining publicly held Common Shares for a cash
consideration of CDN$2.86 per share. On March 7, 2013, the
Corporation received securityholder approval for the proposed
Plan of Arrangement. Closing is expected to take place by the
end of Q3 2013 following receipt of all required regulatory
-- On March 25, 2013, the Corporation arranged a three year, $1.45
billion unsecured revolving credit facility with an ARMZ
affiliate. The drawings under the facility bear interest at the
rate of 3.3% per annum. On March 26, 2013, the Corporation drew
down the facility as it evaluates initiatives to expand its
-- On April 5 2013, the Tanzanian Government issued a Special
Mining License for the Company's Mkuju River Project.
Negotiations with the Tanzanian Government on the terms of a
mine development agreement and other required Tanzanian
approvals are continuing.
-- Total attributable production for 2013 and 2014 is expected to
be 12.5 million and 13.0 million pounds, respectively.
-- During 2013, the average cash cost per pound sold is expected
to be approximately $19 per pound.
-- The Corporation expects attributable sales to be approximately
12.5 million and 13.0 million pounds in 2013 and 2014,
-- The Corporation expects to incur attributable capital
expenditures in 2013 of $92 million for wellfield development
and $62 million for plant and equipment, totalling $154 million
for its assets in Kazakhstan, the United States and Australia.
-- In 2013, general and administrative expenses, excluding
non-cash items, are expected to be approximately $40 million
and exploration expenses are expected to be $5 million.
Q2 2013 Operations and Projects
During Q2 2013, Uranium One achieved attributable production of 3.6 million
pounds, an increase of 18% over attributable production of 3.0 million pounds
for the comparable period in 2012.
Operational results for Uranium One's assets during Q2 2013 were:
| Asset |Q2 Attributable Production| Q2 Total Cash Costs |
| | (lbs U(3)O(8)) |(per lb sold U(3)O(8))|
|Akdala | 508,600 | $14 |
|South Inkai | 1,051,500 | $19 |
|Karatau | 664,100 | $11 |
|Akbastau | 514,100 | $13 |
|Zarechnoye | 311,500 | $25 |
|Kharasan ((1)) | 135,400 | $30 |
|Willow Creek( (1))| 283,400 | - |
|Honeymoon( (2)) | 84,700 | - |
|Total | 3,553,300 | $19 |
Q2 2013 Financial Review
Revenue was $11.9 million in Q2 2013, compared to $13.0 million in Q2 2012.
Joint venture revenue in Q2 2013 was $111.1 million, compared to $83.8 million
in Q2 2012.
The average realized sales price during Q22013 was $43per pound, compared
to $51 per pound in Q2 2012. The average spot price in Q2 2013 was $40 per
pound compared to $51 per pound in Q2 2012.
Earnings from mine operations were $5.1 million in Q2 2013, compared to
$3.1million in Q2 2012.
Earnings from mine operations, including earnings from joint ventures, were
$31.1 million in Q2 2013, a 22% decrease compared to earnings from mine
operations, including joint ventures, of $40.1million in Q2 2012.
Inventory as at June 30, 2013 was 1.0 million pounds for the Corporation and
its subsidiaries, which includes work in progress as well as finished product
ready to be shipped or in transit. Inventory held by the joint ventures was
4.9 million pounds as at June 30, 2013.
The net earnings for Q2 2013 were $10.6 million or $0.01 per share, compared
to net earnings of $29.2 million or $0.03 per share for Q2 2012.
The adjusted net earnings for Q2 2013 were $7.0 million or $0.01 per share,
compared to adjusted net earnings of $8.4 million or $0.01 per share for Q2
Consolidated cash and cash equivalents including restricted cash were $1,824.0
million as at June 30, 2013 compared to $442.0 million at December 31, 2012.
Working capital was $550.4 million at June 30, 2013.
The following table provides a summary of key financial results:
FINANCIAL Q2 2013 Q2 2012 YTD YTD
Q2 2013 Q2 2012
(lbs)((1)) 3,468,600 2,798,800 6,486,600 5,371,300
Attributable sales (lbs)(
(1)) 2,865,100 1,883,600 4,246,400 3,693,000
Average realized sales
price ($ per lb)((3)) 43 51 44 52
Average total cash cost
per pound sold ($ per lb)
((3)) 19 16 18 15
(6)) 11.9 13.0 17.1 18.3
Revenues from joint
ventures ($millions) 111.1 83.8 168.5 174.4
Earnings from mine
(4)(5)) 5.1 3.1 7.0 8.4
Earnings from mine
earnings from joint 31.1 40.1 50.7 89.4
Net earnings ($millions) 10.6 29.2 1.1 33.7
Net earnings per share -
basic and diluted ($ per
share) 0.01 0.03 0.00 0.04
Adjusted net earnings
($millions)((3)) 7.0 8.4 2.2 23.0
Adjusted net earnings per
share - basic ($ per
share)((3)) 0.01 0.01 0.00 0.02
The following table provides a reconciliation of adjusted net earnings to the
consolidated financial statements:
US DOLLARS IN 3 MONTHS ENDED 6 MONTHS ENDED
PER SHARE JUN 30, 2013 JUN 30, 2012 JUN 30, 2013 JUN 30, 2012
AMOUNTS $'MILLIONS $'MILLIONS $'MILLIONS $'MILLIONS
Net earnings 10.6 29.2 1.1 33.7
Fair value (0.7) 0.3 (0.9) 0.3
Corporate 0.9 0.5 6.0 2.4
Restructuring - - 2.1 -
Ruble bond hedge (3.8) (11.2) (6.1) (3.0)
Non-recurring - (10.4) - (10.4)
Adjusted net 7.0 8.4 2.2 23.0
Adjusted net 0.01 0.01 0.00 0.02
share - basic and
number of shares
(millions) - 957.2 957.2 957.2 957.2
The financial statements, as well as the accompanying management's discussion
and analysis were prepared in accordance with International Financial
Reporting (IFRS) and are available for review at www.uranium1.com and should
be read in conjunction with this news release. Any reference to information
including joint venture balances should be read as a non-IFRS measure used to
compare our financial performance to prior periods. All figures are in U.S.
dollars unless otherwise indicated. All references to pounds sold or pounds
produced are to pounds of U(3)O(8).
About Uranium One
Uranium One is one of the world's largest uranium producers with a globally
diversified portfolio of assets located in Kazakhstan, the United States,
Australia and Tanzania.
Notes to the financial results:
(1)Attributable production and sales are from assets owned and joint
ventures in commercial production during the period.
(2)Honeymoon production represents concentrates in process that
require further processing in order to become uranium concentrates that can be
converted into a saleable product.
(3)The Corporation has included the following non-IFRS performance
measures: average realized sales price per pound, cash cost per pound sold,
adjusted net earnings and adjusted net earnings per share. In the uranium
mining industry, these are common performance measures but do not have any
standardized meaning, and are non-IFRS measures. The Corporation believes
that, in addition to conventional measures prepared in accordance with IFRS,
the Corporation and certain investors use this information to evaluate the
Corporation's performance and ability to generate cash flow. The additional
information provided herein should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with IFRS. See
(4)Comparative information has been restated with the adoption of
IFRS 11 - Joint arrangements on January 1, 2013.
(5)Includes profits / losses for joint venture production delivered
into contracts held by the Corporation, and excludes revenues from joint
No stock exchange, securities commission or other regulatory authority has
approved or disapproved the information contained herein.
Investors are advised to refer to independent technical reports containing
detailed information with respect to the material properties of Uranium One.
These technical reports are available under the profile of Uranium One Inc. at
www.sedar.com. Those technical reports provide the date of each resource or
reserve estimate, details of the key assumptions, methods and parameters used
in the estimates, details of quality and grade or quality of each resource or
reserve and a general discussion of the extent to which the estimate may be
materially affected by any known environmental, permitting, legal, taxation,
socio-political, marketing, or other relevant issues. The technical reports
also provide information with respect to data verification in the estimation.
Forward-looking statements: This press release contains certain
forward-looking statements. Forward-looking statements include but are not
limited to those with respect to the price of uranium, the estimation of
mineral resources and reserves, the realization of mineral reserve estimates,
the timing and amount of estimated future production, the timing of uranium
processing facilities being fully operational, costs of production, capital
expenditures, costs and timing of the development of new deposits, success of
exploration activities, permitting time lines, currency fluctuations, market
conditions, corporate plans, objectives and goals, requirements for additional
capital, government regulation of mining operations, the estimation of mineral
resources and reserves, the realization of resource and reserve estimates,
environmental risks, unanticipated reclamation expenses, the timing and
potential effects of proposed acquisitions, title disputes or claims and
limitations on insurance coverage and the timing and possible outcome of
pending litigation. In certain cases, forward-looking statements can be
identified by the use of words such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes" or variations
of such words and phrases, or state that certain actions, events or results
"may", "could", "would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements
of Uranium One to be materially different from any future results, performance
or achievements expressed or implied by the forward-looking statements. Such
risks and uncertainties include, among others, the completion of the projects
described in this press release, the future steady state production and cash
costs of Uranium One, the actual results of current exploration activities,
conclusions of economic evaluations, changes in project parameters as plans
continue to be refined, possible variations in grade and ore densities or
recovery rates, failure of plant, equipment or processes to operate as
anticipated, possible shortages of sulphuric acid in Kazakhstan, possible
changes to the tax code in Kazakhstan, accidents, labour disputes or other
risks of the mining industry, delays in obtaining government approvals or
financing or in completion of development or construction activities, risks
relating to the integration of acquisitions and the realization of synergies
relating thereto, to international operations, to prices of uranium, as well
as those factors referred to in the section entitled "Risk Factors" in Uranium
One's Annual Information Form for the year ended December 31, 2012, which is
available on SEDAR at www.sedar.com, and which should be reviewed in
conjunction with this document. Although Uranium One has attempted to identify
important factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there may be
other factors that cause actions, events or results not to be as anticipated,
estimated or intended. There can be no assurance that forward-looking
statements will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking
statements. Uranium One expressly disclaims any intention or obligation to
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except in accordance with applicable
For further information about Uranium One, please visit www.uranium1.com.
Chris Sattler Chief Executive Officer Tel: +1 647 788 8500
Anton Jivov Vice President Corporate Affairs Tel: +1 647 788 8461
SOURCE: Uranium One Inc.
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