LAKEWOOD, CO, Nov. 2, 2017 /CNW/ - Energy Fuels Inc.
(NYSE American:UUUU; TSX:EFR) ("Energy Fuels" or the
"Company"), today reported its financial results for the
quarter ended September 30, 2017. The
Company's quarterly report on Form 10-Q has been filed with the
U.S. Securities and Exchange Commission ("SEC"), and may be viewed
on the Electronic Document Gathering and Retrieval System ("EDGAR")
at www.sec.gov/edgar.shtml, on the System for Electronic Document
Analysis and Retrieval ("SEDAR") at www.sedar.com, and on the
Company's website at www.energyfuels.com. Unless noted otherwise,
all dollar amounts are in US dollars.
Financial Highlights:
- At September 30, 2017, the
Company had $32.7 million of working
capital, including cash and cash equivalents of $19.4 million and approximately 470,000 pounds of
uranium concentrate inventory.
- 60,000 pounds of U3O8 sales were
completed by the Company at an average realized price of
$58.28 per pound.
- The Company realized a total gross profit margin of 35% during
Q3-2017.
- Uranium production totaled 465,000 pounds of
U3O8 during the quarter, of which 170,000
pounds were for the Company's account and 295,000 pounds were from
alternate feed materials toll milled for the account of
others.
Stephen P. Antony, Energy
Fuels' CEO stated: "During the past quarter, Energy Fuels
continued to focus on maintaining the strength of our balance sheet
and pursuing alternate feed materials and land cleanup business
opportunities at the White Mesa Mill. During today's low uranium
prices, Energy Fuels enjoys a number of potential revenue
generating opportunities, along with a supportive Administration in
Washington DC that we believe
recognizes the importance of maintaining a healthy U.S. uranium
mining industry.
"In addition, our operations teams at our various production
centers deserve accolades. Energy Fuels' Nichols Ranch ISR Facility
surpassed one million pounds of U3O8
production during the past quarter. Our White Mesa Mill
continues to be a key part of the Company due to its ability to
generate cash from the processing of alternate feed materials and
the potential to process material generated from land cleanup work.
Our conventional team, which includes the conventional mines and
the White Mesa Mill, also recently surpassed one million
employee-hours without a lost-time accident – a truly remarkable
achievement. And, our teams at the Canyon Mine and the Alta Mesa
ISR Project continued to demonstrate their professionalism and
expertise in building and maintaining our Company's low-cost
uranium production capabilities. These people are Energy Fuels'
most important assets, as we perform our role in maintaining
America's vital domestic uranium mining industry in these tough
uranium markets."
Key Developments:
The Company released a new uranium and copper resource estimate
for the Canyon Mine on August 23,
2017, and filed a technical report supporting that resource
estimate on October 10, 2017 in
accordance with National Instrument 43-101 – Standards of
Disclosure for Mineral Projects ("NI 43-101"). The new estimate
increased the uranium resources by one million pounds of
U3O8, improved the previous resource estimate
from the inferred to measured and indicated categories, and
reported a new high-grade copper resource. According to the
technical report, the Canyon Mine is estimated to contain 139,000
tons of Measured and Indicated Mineral Resources with an average
grade of 0.88% U3O8 containing 2,434,000
pounds of uranium. Additionally, the Resource Estimate identifies
another 134,000 pounds of uranium in the Inferred Mineral Resource
category. In addition, in the zone containing copper, the Canyon
Mine is estimated to contain 101,000 tons of Measured and Indicated
Mineral Resources with an average grade of 5.93% Cu, containing
11,939,000 pounds of copper.
On November 2, 2017, the Company
announced that it had entered into an agreement to sell its
non-core Reno Creek property in Wyoming to Uranium Energy Corp. ("UEC") for
total consideration of $5.39 million,
including $2.94 million of cash and
$2.45 million of shares in UEC that
will be priced upon the closing of the transaction.
During Q3-2017, the Company's Nichols Ranch ISR Facility
surpassed one million pounds of total life-of-mine uranium
production.
Mr. Antony continued: "The Company's uranium recovery
operations continued to perform well during the quarter, and we
reaffirm our full year production and sales guidance for FY-2017.
We also continue to believe that the Canyon Mine, when
brought into production, will have low overall costs per pound,
in-line with the lowest cost conventional uranium mines operating
in the world today. We also continue to evaluate our process
options to optimize the recovery of copper at the White Mesa Mill,
to potentially further reduce our uranium cost-per-pound from the
mine. We are also evaluating the impacts of current vanadium prices
on the timing of potential restarts of the Company's
uranium/vanadium mines on the Colorado Plateau, in improved uranium
markets. Energy Fuels is truly unique in the U.S. uranium sector.
In addition to our remaining term uranium sales contracts, we have
other ways to generate revenues. These are providing us with some
protection in today's weak uranium market. At the same time, we
have a portfolio of fully-permitted and developed projects ready to
quickly increase the Company's low-cost uranium production as
uranium markets improve."
Selected Summary Financial Information:
|
|
|
$000, except per
share data
|
Three months
ended
September 30, 2017
|
Nine months ended
September 30, 2017
|
Results of
Operations:
|
|
|
|
Total
revenues
|
$
|
5,499
|
$
|
27,138
|
|
Gross
profit
|
1,931
|
8,471
|
|
Net loss attributable
to the company
|
(4,766)
|
(19,744)
|
|
Basic and diluted
loss per share
|
(0.07)
|
(0.28)
|
|
|
|
$000's
|
As at September
30,
2017
|
As at December
31,
2016
|
Financial
Position:
|
|
|
|
Working
capital
|
$
|
32,675
|
$
|
24,023
|
|
Property, plant and
equipment
|
33,918
|
37,582
|
|
Mineral
properties
|
83,539
|
92,625
|
|
Total
assets
|
185,300
|
196,457
|
|
Total long-term
liabilities
|
47,205
|
46,487
|
Operations Update and Outlook year ending December 31, 2017
The Company expects to produce a total of 640,000 to 665,000
pounds of U3O8 in the year ending
December 31, 2017 for its own
account, of which 374,000 pounds were produced in the first nine
months of the year.
We expect production at Nichols Ranch to total 260,000 to
270,000 pounds in the year ending December
31, 2017 of which we recovered 204,000 pounds during the
first nine months of 2017. In September
2017, the Nichols Ranch Project surpassed the 1.00 million
pound mark for uranium captured at the plant from its start of
operations in April 2014.
We expect to recover 380,000 to 395,000 pounds of uranium at the
Mill in the year ending December 31,
2017 for the Company's account, of which we recovered
170,000 pounds in the first nine months of 2017. In addition,
during 2017, the Company expects to earn a fee for toll processing
approximately 950,000 pounds of U3O8
contained in alternate feed materials at the Mill, returning all
finished uranium product to the generator of the feed material, of
which 295,000 pounds were produced in the quarter.
Sales and other revenue update and outlook year ending
December 31, 2017
In the nine months ended September 30,
2017, the Company completed deliveries of 420,000 pounds of
U3O8 under four contracts, including 320,000
pounds under three long-term contracts and 100,000 pounds under a
contract where the price was based on spot prices.
In the final three months of the year, the Company expects to
complete one delivery of 100,000 pounds of
U3O8 under a contract where the price is
based on the average spot price per pound of uranium for the five
weeks prior to the dates of delivery.
During the year ending December 31,
2017, the Company expects to earn approximately $6.3 million in toll revenue for processing
alternate feed materials for a third party of which $5.1 million was earned in the first nine months
of 2017.
Operations Update and Outlook for the year ending
December 31, 2018
The Company is continuing to adjust its operations in response
to current uranium prices and market conditions.
The Company does not plan to develop any wellfields at Nichols
Ranch until the price of uranium improves. As a result, production
at Nichols Ranch will continue to decline as current wellfields are
depleted. With no new wellfields, we expect Nichols Ranch will
produce approximately 140,000 to 160,000 pounds of uranium in 2018.
Alta Mesa will remain on standby
until prices improve.
The Mill has historically operated on a campaign basis, whereby
uranium recovery is scheduled as mill feed, cash needs, contract
requirements, and/or market conditions may warrant. Although,
primary mine production is expected to fall while uranium prices
remain low, the Company is actively pursuing other revenue
generating opportunities, including processing new and additional
alternate feed sources, processing low grade ore from third parties
in connection with various uranium clean-up requirements, and
further recovery of Pond Return. Successful results from these
activities will allow the Mill to extend the current processing
campaign into 2018 and beyond.
We plan to complete minor underground work at the Canyon Mine by
the end of the first quarter of 2018. The timing of the Company's
plans to extract and process mineralized materials from the Canyon
project will be based on the results of mine planning, market
conditions and available financing.
Our existing inventory of U3O8 along with
the expected production at Nichols Ranch is expected to provide
more U3O8 than is required for our current
sales contracts. Such excess inventory will be sold in the spot
market as uranium prices increase and/or cash requirements arise.
In the year ending December 31, 2018,
we expect to deliver 200,000 pounds of U3O8
under a long term contract and 200,000 pounds of
U3O8 under a contract where the price will be
based on then-prevailing spot prices.
Stephen P. Antony, P.E., CEO of Energy Fuels,
is a Qualified Person as defined by Canadian National Instrument
43-101 and has reviewed and approved the technical disclosure
contained in this news release.
About Energy Fuels: Energy Fuels is a
leading integrated US-based uranium mining company, supplying
U3O8 to major nuclear utilities. Energy Fuels
holds three of America's key uranium production centers, the White
Mesa Mill in Utah, the Nichols
Ranch Processing Facility in Wyoming, and the Alta Mesa Project in
Texas. The White Mesa Mill is the
only conventional uranium mill operating in the U.S. today and has
a licensed capacity of over 8 million pounds of
U3O8 per year. The Nichols Ranch Processing
Facility is an ISR production center with a licensed capacity of 2
million pounds of U3O8 per year. Alta Mesa is an ISR production center currently
on care and maintenance. Energy Fuels also has the largest NI
43-101 compliant uranium resource portfolio in the U.S. among
producers, and uranium mining projects located in a number of
Western U.S. states, including one producing ISR project, mines on
standby, and mineral properties in various stages of permitting and
development. The Company also produces vanadium as a co-product of
its uranium production from certain of its mines on the Colorado
Plateau, as market conditions warrant. The Company's common shares
are listed on the NYSE MKT under the trading symbol "UUUU", and on
the Toronto Stock Exchange under the trading symbol "EFR".
ADDITIONAL NON-US GAAP FINANCIAL PERFORMANCE MEASURES
The Company has included the additional non-US GAAP measure
"Gross Profit" in the financial statements and in this news
release. Management notes that "Gross Profit" provides useful
information to investors as an indication of the Company's
principal business activities before consideration of how those
activities are financed, sustaining capital expenditures, corporate
and exploration and evaluation expenses, finance income and costs,
and taxation.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This news release contains certain "Forward Looking
Information" and "Forward Looking Statements" within the meaning of
applicable Canadian and United
States securities legislation, which may include, but is not
limited to, statements with respect to: production, revenue and
sales forecasts; the ability of the Company to secure any new
sources of alternate feed materials or other processing
opportunities at the White Mesa Mill; the level of expected support
of the Administration in Washington
D.C. for the U.S. uranium mining industry; whether all or a
portion of the copper resource at the Canyon Project can be
recovered at the White Mesa Mill or elsewhere and whether or not
any such recoveries will further reduce the Company's
cost-per-pound; expectations relating to mining costs at the Canyon
Project and other projects; expectations relating to the White Mesa
Mill being able to extend the current processing campaign into 2018
and beyond; expectations relating to any impacts the current
high vanadium prices may have on the timing of potential restarts
of the Company's uranium/vanadium mines; scalability, and
the Company's ability and readiness to re-start or expand any of
its existing projects to respond to any improvements in uranium
market conditions; the ability of the Company to enjoy some
insulation from spot market weakness; mineral resource estimates;
the Company's expectations as to longer term fundamentals in the
market and price projections; and expectations to become or
maintain its position as a leading uranium company in the United States. 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, herein are 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 include risks associated with:
production, revenue and sales forecasts; the ability of the Company
to secure any new sources of alternate feed materials or other
processing opportunities at the White Mesa Mill; the level of
expected support of the Administration in Washington D.C. for the U.S. uranium mining
industry; whether all or a portion of the copper resource at the
Canyon Project can be recovered at the White Mesa Mill or elsewhere
and whether or not any such recoveries will further reduce the
Company's cost-per-pound; expectations relating to mining costs at
the Canyon Project and other projects; expectations relating to the
White Mesa Mill being able to extend the current processing
campaign into 2018 and beyond; expectations relating to any
impacts the current high vanadium prices may have on the timing of
potential restarts of the Company's uranium/vanadium mines;
scalability, and the Company's ability and readiness to re-start
or expand any of its existing projects to respond to any
improvements in uranium market conditions; the ability of the
Company to enjoy some insulation from spot market weakness; mineral
resource estimates; the Company's expectations as to longer term
fundamentals in the market and price projections; expectations to
become or maintain its position as a leading uranium company in
the United States; and the other
factors described under the caption "Risk Factors" in the Company's
Annual Report on Form 10-K dated March 9,
2017, which is available for review on EDGAR at
www.sec.gov/edgar.shtml, on SEDAR at www.sedar.com, and
on the Company's website at www.energyfuels.com.
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. The Company assumes no obligation to update the
information in this communication, except as otherwise
required by law.
Cautionary note to United
States investors concerning estimates of measured, indicated
and inferred resources. This news
release contains certain disclosure that has been prepared in
accordance with the requirements of Canadian securities laws, which
differ from the requirements of U.S. securities
laws. Unless otherwise indicated, all reserve
and resource estimates included in this news release have been
prepared in accordance with NI 43-101 and the Canadian Institute of
Mining, Metallurgy and Petroleum ("CIM") classification
system. Canadian standards, including NI
43-101, differ significantly from the requirements of U.S.
securities laws, and reserve and resource information contained in
this news release may not be comparable to similar information
disclosed by companies reporting only under U.S.
standards. In particular, the term "resource"
does not equate to the term "reserve" under SEC Industry Guide
7. United
States investors are cautioned not to assume that all or any
of Measured or Indicated Mineral Resources will ever be converted
into mineral reserves. Investors
are cautioned not to assume that all or any part of an "Inferred
Mineral Resource" exists or is economically or legally
minable. Energy Fuels does not
hold any Reserves as that term is defined by SEC Industry Guide
7. Please refer to the section
entitled "Cautionary Note to United States Investors Concerning
Disclosure of Mineral Resources" in the Company's Annual Report on
Form 10-K dated March 15, 2016 for
further details.
SOURCE Energy Fuels Inc.