Uranium Resources Reports Preliminary 2016 Results
February 13 2017 - 10:30PM
Uranium Resources, Inc. (Nasdaq:URRE) (ASX:URI),
an energy metals exploration and development company, announced
today its preliminary unaudited fiscal year end operating results
for 2016 and key business highlights for 2016 and to date.
Christopher M. Jones, President and Chief
Executive Officer, said, “We continue to make our business leaner
and lower cost, while simultaneously developing a new lithium
business and maintaining our optionality on the future rising
uranium price. As we enter 2017 with substantial cash in our
treasury, we are in a strong financial position to fund our
business operations going forward. We are not just waiting
for change, we are making change.”
Key Business Highlights for 2016 and to
Date
- Acquisition of lithium properties. The Company’s expansion into
lithium development included the acquisition of dominant land
positions in two prospective basins for lithium brines in the
western United States – the Columbus Basin Project in Nevada and
the Sal Rica Project in Utah. The Company first announced that it
had initiated a lithium exploration and development business on
August 24, 2016.
- Uranium operations. In 2016 the Company continued to
maintain its uranium properties on standby, awaiting improved
uranium market prices. Activities included continued
restoration/reclamation activities in South Texas, while in New
Mexico, the Company is currently in negotiations for extensions on
the Cebolleta and Juan Tafoya leases. The Company’s Temrezli
property in Turkey is also being maintained on standby.
- Laramide asset sale. On January 5, 2017, the Company closed the
sale of its Crownpoint and Churchrock properties in New Mexico to
Laramide Resources Ltd. (“Laramide”). At the closing, the
Company received $2.25 million in cash, common stock and warrants
from Laramide valued at $0.5 million, a three-year secured
promissory note in the amount of $5.0 million and other
considerations. The Company had received a non-refundable
payment of $250,000 from Laramide in October 2016.
- Equity Capital Raises. In 2016, the Company raised $14.5
million, comprised of $2.0 million from two registered direct
offerings, $6.7 million from sales under the Company’s common stock
purchase agreement [with Aspire Capital Fund LLC] and $5.8 million
from sales through the Company’s At-The-Market sales
agreement. On January 19, 2017, the Company raised net
proceeds of $8.9 million from the sale of common stock and
pre-funded warrants in a confidentially marketed public
offering. All warrants have been exercised.
- RCF Loan retired. Between December 5 and December 22,
2016, the Company issued 2,487,562 shares of common stock to Esousa
Holdings LLC (“Esousa”) under the terms of an Exchange Agreement to
retire $2.5 million of the $8.0 million loan with Resource Capital
Fund V L.P. (“RCF”). Esousa had purchased the $2.5 million
note from RCF under a separate agreement. On February 9,
2017, the Company paid $5.7 million out of treasury to repay the
remaining principal and interest amounts due and outstanding under
the RCF loan agreement, and the loan agreement was thereby
terminated. In connection with the termination of the loan
agreement, all security interests and pledges granted to RCF by the
Company and certain of its subsidiaries were terminated and in due
course will be released.
- Cash balance. At February 13, 2017, after payment of the
RCF loan, we have $6.8 million in our treasury.
Key Preliminary Financial Highlights
(unaudited)
The Company notes that these financial results
for the year ended December 31, 2016 are preliminary and subject to
the completion of its financial closing procedures and audit by its
independent auditors. There can be no assurance that the Company's
final audited financial results for the fourth fiscal quarter and
year ended December 31, 2016 will not differ from these preliminary
estimates as a result of final closing and review procedures or
audit adjustments, and any such changes could be material. Readers
are cautioned not to place undue reliance on the preliminary
financial results. The reporting date for final audited 2016
results will be announced separately.
Table 1: Preliminary Financial Summary
(unaudited)
- Net loss. Net loss for the 12 months ended December 31, 2016 is
$19.6 million compared to a loss of $15.1 during the same period in
2015. The primary difference in the comparative net loss was
a one-time item in 2015, a gain of $4.3 million from the sale of
the Roca Honda project to Energy Fuels Inc. 2016 includes a
non-cash loss on extinguishment of debt $3.3 million related to the
exchange agreement between the Company and Esousa which is the
difference between the fair value of the shares exchanged with
Esousa and the fair value of the shares that would have been
issuable to RCF.
- Cash and working capital. Continued working capital
improvements resulted in an improved cash balance of $3.3 million
at December 31, 2016, and a reduction in accounts payable from $3.0
million at December 31, 2015 to $0.6 million at December 31,
2016. As of February 13, 2017, the Company held cash
and cash equivalents totaling approximately $6.8 million.
- Shares outstanding. Total shares outstanding at February
13 are 21,495,273.
About Uranium Resources
URI is focused on expanding its energy metals
strategy, which includes developing its new lithium business while
maintaining optionality on the future rising uranium price.
The Company has developed a dominant land position in two
prospective lithium brine basins in Nevada and Utah in preparation
for exploration and potential development of any lithium resources
that may be discovered there. In addition, URI remains
focused on advancing the Temrezli in-situ recovery (ISR) uranium
project in Central Turkey when uranium prices permit economic
development of this project. URI controls extensive exploration
properties in Turkey under eight exploration and operating licenses
covering approximately 32,000 acres (over 13,000 ha) with numerous
exploration targets, including the potential satellite Sefaatli
Project, which is 30 miles (48 km) southwest of the Temrezli
Project. In Texas, the Company has two licensed and currently idled
uranium processing facilities and approximately 11,000 acres (4,400
ha) of prospective ISR uranium projects. In New Mexico, the Company
controls mineral rights encompassing approximately 186,000 acres
(75,300 ha) in the prolific Grants Mineral Belt, which is one of
the largest concentrations of sandstone-hosted uranium deposits in
the world. Incorporated in 1977, URI also owns an extensive
information database of historic drill hole logs, assay
certificates, maps and technical reports for uranium properties
located in the Western United States.
Cautionary Statement
This news release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements are subject to
risks, uncertainties and assumptions and are identified by words
such as “expects,” “estimates,” “projects,” “anticipates,”
“believes,” “could,” and other similar words. All statements
addressing events or developments that the Company expects or
anticipates will occur in the future, including but not limited to
statements relating to developments at the Company’s projects,
including future exploration costs and results, are forward-looking
statements. Because they are forward-looking, they should be
evaluated in light of important risk factors and uncertainties.
These risk factors and uncertainties include, but are not
limited to, (a) estimated or expected net cash used in operations,
mineral property expenses, general and administrative expenses, net
loss, and cash and working capital positions for the twelve months
ended December 31, 2016, (b) the Company’s ability to raise
additional capital in the future; (c) spot price and long-term
contract price of uranium and lithium; (d) risks associated with
our foreign operations, (e) operating conditions at the Company’s
projects; (f) government and tribal regulation of the uranium
industry, the lithium industry, and the power industry; (g)
world-wide uranium and lithium supply and demand, including the
supply and demand for lithium-based batteries; (h) maintaining
sufficient financial assurance in the form of sufficiently
collateralized surety instruments; (i) unanticipated geological,
processing, regulatory and legal or other problems the Company may
encounter in the jurisdictions where the Company operates,
including in Texas, New Mexico, Utah, Nevada and Turkey; (j) the
ability of the Company to enter into and successfully close
acquisitions or other material transactions; (k) the results
of the Company’s lithium brine exploration activities at the
Columbus Basin and Sal Rica Projects, (l) the ability of the
Company to negotiate extensions on the Cebolleta and Juan Tafoya
leases and (m) other factors which are more fully described in the
Company’s Annual Report on Form 10-K, Quarterly Reports on Form
10-Q, and other filings with the Securities and Exchange
Commission. Should one or more of these risks or uncertainties
materialize, or should any of the Company’s underlying assumptions
prove incorrect, actual results may vary materially from those
currently anticipated. In addition, undue reliance should not be
placed on the Company’s forward-looking statements. Except as
required by law, the Company disclaims any obligation to update or
publicly announce any revisions to any of the forward-looking
statements contained in this news release.
Uranium Resources Contact:
Christopher M. Jones, President and CEO
303.531.0472
Jeff Vigil, VP Finance and CFO
303.531.0473
Email: Info@uraniumresources.com
Website: www.uraniumresources.com
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