TORONTO, ONTARIO — (Marketwired) — 05/09/13 — Energy Fuels Inc. (TSX: EFR) („Energy Fuels“ or the „Company“) today reported its financial results for the quarter-ended March 31, 2013 („Q2-2013“). The Company-s Quarterly Consolidated Financial Statements, along with Management-s Discussion and Analysis, has been filed on the System for Electronic Document Analysis and Retrieval („SEDAR“) and may be viewed at . Unless noted otherwise, all dollar amounts are in US dollars.
Selected Summary Financial Information
Company Financial and Operational Highlights for Q2-2013:
Energy Fuels Outlook for the Fiscal Year Ended September 30, 2013 („FY-2013“)
Energy Fuels continues to execute its corporate strategy which balances prudent, measured operations during the current uranium price environment, while concurrently positioning the Company to realize the economic benefits of anticipated improvements in the price of uranium through select development expenditures and care and maintenance activities. Energy Fuels believes the long-term uranium market outlook remains positive (as outlined below in Market Outlook for FY-2013) and is supported by strong supply and demand fundamentals within the sector. However, the Company anticipates that short-term price weakness could persist.
Energy Fuels remains focused on relatively lower cost sources of production from its Arizona Strip mines and alternate feed materials. These will provide Energy Fuels with the U3O8 required for delivery pursuant to its term contracts. By doing so, the Company aims to maximize its realized sales price per pound of U3O8 and minimize its marginal cash cost of production. Consistent with this strategy, Energy Fuels is pleased to provide the following operational update.
The Company has determined that it can realize production efficiencies by milling its entire stockpile of conventional ore, including the ore stockpiled as of March 31, 2013 (mainly comprised of Arizona Strip and Daneros ore), during the quarter-ended June 30, 2013 („Q3-2013“). As such, the Company has elected to increase its production forecast for FY 2013. The Company expects to resume conventional ore processing during the second half of FY-2014. The processing of alternate feed materials is expected to continue through the remainder of FY-2013 and into FY 2014. Mining activities are expected to continue on the Arizona Strip for the remainder of FY-2013 and into FY-2014.
Energy Fuels expects improvements in the uranium price over the medium to long-term and is maintaining, and selectively growing, its asset base in a manner that positions the Company to realize the associated economic benefits of a higher uranium price. Production at the Pinenut mine in Arizona is currently anticipated to begin in Q3-2013. The Company placed its formerly producing mines on the Colorado Plateau on care and maintenance. Development of the Canyon Mine in Arizona is anticipated to continue, securing a relatively lower-cost ore feed to the White Mesa Mill. Permitting at the Sheep Mountain Project is anticipated to continue, advancing a second major production center for the Company. The Company is evaluating potential new supplies of alternate feed materials for the White Mesa Mill (which carry no mining costs). The Company will continue to evaluate additional toll milling and/or ore purchase agreements with third-parties who own uranium properties within trucking distance of the White Mesa Mill. Energy Fuels will also continue to evaluate growth through accretive acquisitions.
As outlined below, Energy Fuels provides the following updated outlook for FY-2013 and provides the following outlook for uranium sales and production for Q3-2013:
Market Outlook for FY-2013
The uranium market has seen little change over the past quarter, with the spot price and term price remaining relatively stable. During the last quarter, sales volumes remained low, and there was little impetus for new long-term contracts. As a result, the spot price of uranium dropped $1.00/lb. from $43.25/lb. to $42.25/lb., according to TradeTech. As of May 9, 2013, the spot price was $40.60/lb. During the last quarter, TradeTech-s long-term price indicator remained unchanged at $57.00/lb.
While Energy Fuels continues to anticipate modest uranium market improvements in FY-2013, and into FY-2014, significant market improvements will require a market catalyst. Catalysts include the restart of nuclear reactors in Japan following the issuance of final safety guidelines in July, further delays in new uranium mining projects around the world, or stronger than anticipated demand.
Nevertheless, long-term demand fundamentals within the uranium sector remain strong. China, Russia, India, the U.S., the UK, Saudi Arabia and Brazil continue to develop nuclear power plants. Globally, there are now 66 nuclear reactors under construction, and 479 nuclear reactors are planned or proposed (versus 65 and 484, respectively, in the last quarter), as reported by the World Nuclear Association. Indeed, China and India plan to begin operation at eight nuclear reactors this year. In addition, long-term supplies may not meet demand, as uranium mining projects around the world continue to be delayed and shelved as a result of the current price weakness. When prices strengthen and new projects are proposed, it will likely take several years for these projects to be permitted and go into production. On the other hand, new supplies from government-controlled entities are not market driven and may come online sooner.
In addition, several positive market indicators are described below:
Based on these factors, Energy Fuels believes the market will see a modest strengthening of the uranium spot price by the end of 2013 with accelerated strengthening expected into 2014. However, in the short-term, the Company believes the spot price will remain in the low $40 range, and possibly dropping below $40, before a recovery begins. Despite the challenging short-term market environment, Energy Fuels believes it is well positioned to execute the Company-s business plan.
Stephen P. Antony, P.E., President & CEO of Energy Fuels, is a Qualified Person as defined by National Instrument 43-101 and has reviewed and approved the technical disclosure contained in this document.
About Energy Fuels: Energy Fuels is America-s largest conventional uranium producer, supplying approximately 25% of the uranium produced in the U.S., and is also a significant producer of vanadium.
The company operates the White Mesa Mill, which is the only conventional uranium mill currently operating in the U.S., capable of processing 2,000 tons per day of uranium ore. Energy Fuels has projects located throughout the Western U.S., including producing mines and mineral properties in various stages of permitting and development.
This news release contains certain „Forward-Looking Statements“ within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended and „Forward Looking Information“ within the meaning of applicable Canadian securities legislation, which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as „plans“, „expects“ „does not expect“, „is expected“, „is likely“, „budget“ „scheduled“, „estimates“, „forecasts“, „intends“, „anticipates“, „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“, „be achieved“ or „have the potential to“. All statements, other than statements of historical fact, included herein are generally considered to be forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements express or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption „Risk Factors“ in the Company-s Annual Information Form dated December 20, 2012, which is available for view on the System for Electronic Document Analysis and Retrieval at . Forward-looking statements contained herein are made as of the date of this news release and the Company disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management-s estimates or opinions should change, or otherwise. 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, the reader is cautioned not to place undue reliance on forward-looking statements.
Contacts: Energy Fuels Inc. Curtis Moore Investor Relations (303) 974-2140 or Toll free: 1-888-864-2125
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