Cameco (TSX: CC0) has released its consolidated financial and operational results for the first quarter ending March 31, 2024, top lined by quarterly revenue of $634 million, an 8% drop from Q1 2023’s $687 million.
According to CEO Tim Gitzel, the first quarter showcased robust operational performance across uranium, fuel services, and Westinghouse segments. Gitzel stated, “Financial results are in line with the 2024 outlook we provided, which has not changed, and are as expected, reflecting normal quarterly variability and the required purchase accounting and other non-operational acquisition-related costs for Westinghouse.”
While gross profit jumped 12% to $187 million from last year’s $167 million, the firm ended with a net loss of $7 million compared to last year’s net income of $119 million. The loss was attributed to the firms Westinghouse segment, which saw a loss of $123 million, while the uranium segment saw net earnings of $253 million, and fuel services reported net earnings of $20 million.
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This loss translates to $0.02 loss per share.
Adjusted net earnings totaled $56 million while Adjusted EBITDA totaled $345 million for the quarter. On an adjusted basis, the firm ended the quarter with $0.13 earnings per share, falling short of the analyst estimate of $0.25 per share.
“Operationally, production results in the first quarter were strong and are on track with our 2024 plans, with production rates and total production costs in our uranium segment continuing to reflect the transition back to our tier-one cost structure,” continued Gitzel.
The company’s shares dropped almost 6% in pre-market trading following the news.
Operationally, production results in the uranium segment “were strong and are on track with our 2024 plans,” reflecting a transition back to tier-one cost structures. Selective commitment of unencumbered, tier-one, in-ground uranium inventory and UF6 conversion capacity facilitated the addition of long-term contracts, averaging about 28 million pounds per year from 2024 through 2028.
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Production performance in the uranium segment saw an increase to 5.8 million pounds (Cameco’s share) with unit cash cost of production reduced by 16% to $19.52 per pound. The company managed to produce 5.8 million pounds during the quarter at a total cost of production, including non-cash cost, at $29.31 per pound. Cameco also purchased 2.6 million pounds during the quarter at a cost of C$87.75 per pound, bringing its average across produced and purchased uranium to $47.40 per pound.
Comparatively, 7.3 million pounds were sold during the quarter, at an average realized price of C$77.33 per pound.
Long-term contracting also continued, with Cameco said to be maintaining exposure to higher prices with commitments requiring delivery averaging about 28 million pounds per year from 2024 through 2028.
Following the quarter end, Cameco received a cash dividend of $129 million, net of withholdings, from JV Inkai based on its 2023 financial performance. JV Inkai shipments continue, although the company is experiencing procurement and supply chain issues, primarily related to the availability of sulfuric acid.
Cameco’s outlook for 2024 stands at consolidated revenue between approximately $2.9 billion and $3.0 billion. The company also commented that it expects its share of Westinghouse’s adjusted EBITDA to be between $445 million and $510 million.
Information for this story was found via Sedar and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
