Energy Fuels Announces Q1-2024 Results, Including Continued Net Income, Continued Successful Uranium Ramp-Up, Commissioning Rare Earth Oxides Production, and Steps to Secure World-Scale Sources of Heavy Mineral Sands and Monazite
PR Newswire
LAKEWOOD, Colo., May 3, 2024
Conference Call and Webcast on May 6, 2024
LAKEWOOD, Colo., May 3, 2024 /PRNewswire/ - Energy Fuels Inc. (NYSE American: UUUU) (TSX: EFR) ("Energy Fuels" or the "Company") today reported its financial results for the quarter ended March 31, 2024. 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, on the System for Electronic Data Analysis and Retrieval + ("SEDAR+") at www.sedarplus.ca, and on the Company's website at www.energyfuels.com. Unless noted otherwise, all dollar amounts are in U.S. dollars.
-- Recorded Net Income of Over $3 Million: During the three months ended
March 31, 2024, the Company earned net income of $3.64 million, or $0.02
per common share, including operating income of $2.02 million.
-- Robust Balance Sheet with Over $220 million of Liquidity and No Debt: As
of March 31, 2024, the Company had $222.54 million of working capital
including $54.78 million of cash and cash equivalents, $140.80 million of
marketable securities (uranium stocks and interest-bearing securities),
$28.25 million of inventory, and no debt.
-- Over $20 Million of Additional Liquidity from Market Value of
Inventory: At current commodity prices, the Company's product inventory
has a market value of approximately $40.82 million, while the balance
sheet reflects product inventory carried at cost of $19.96 million.
-- Uranium Drives Revenue: The Company sold 300,000 pounds of uranium
concentrates ("U3O8") at a weighted average price of $84.38 per pound for
$25.31 million, which resulted in a gross profit of $14.26 million and an
average gross margin of 56%.
-- SX "Phase 1" REE Separation Circuit Development Completed: The Phase 1
modification and enhancements to the existing solvent extraction ("SX")
circuit at the Company's White Mesa Mill (the "Mill") were completed in
Q1-2024, and the Mill expects to complete commissioning of the new
circuit in Q2-2024.
-- Well-Stocked to Capture Market Opportunities: As of March 31, 2024, the
Company held 385,000 pounds of finished U3O8, 905,000 pounds of finished
vanadium ("V2O5"), and 11 tonnes of finished high purity, partially
separated mixed rare earth carbonate ("RE Carbonate") in inventory. The
Company holds an additional 495,000 pounds of U3O8 as raw materials and
work-in-progress inventory (for total finished, raw material and
work-in-progress inventory of 880,000 pounds of U3O8), along with an
estimated 1 - 3 million pounds of solubilized V2O5 in tailings solutions
that could be recovered in the future. Additionally, at March 31, 2024
the Company had 480 tonnes of REE raw materials (monazite concentrate) in
inventory.
Capitalizing on Strong Uranium Pricing:
-- During the three months ended March 31, 2024, the Company sold 300,000
pounds of U3O8 for $25.31 million or a realized sales price of $84.38 per
pound. These sales resulted in a gross profit of $14.26 million ($47.54
per pound of U3O8), or a 56% gross margin.
-- The Company recently renewed an alternate feed agreement with one of our
key customers, providing the Company with an estimated long-term,
multi-year, low-cost source of 11,000 to 30,000 pounds of U3O8 per year.
-- During the three months ended March 31, 2024, the Company continued
uranium ore production at its Pinyon Plain (Arizona), La Sal (Utah) and
Pandora (Utah) mines.
-- Once production is fully ramped up at these mines, which is expected by
mid- to late-2024, the Company expects to be mining at a run-rate of 1.1
to 1.4 million pounds of newly mined U3O8 per year.
-- During 2024, the Company expects to produce approximately 150,000 to
500,000 pounds of finished U3O8 from newly mined conventional ore,
stockpiled ore, and recycled alternate feed materials, depending on the
timing of the ramp up of production at the Company's Pinyon Plain, La Sal
and Pandora mines, and Mill schedule, while increasing to higher levels
of production in 2025 and beyond.
-- The Company expects to offer to buy uranium and uranium/vanadium ore from
third-party miners in the vicinity of the Mill during 2024, which has the
potential to contribute to the Company's production profile.
-- On April 30, the U.S. Senate approved by unanimous consent the
Prohibiting Russian Uranium Imports Act, which bans the import of Russian
uranium products into the U.S. Under the ban, which commences 90 days
after enactment and terminates in 2040, all imports of uranium products
from Russia will be banned, subject to waivers in the event "no
alternative viable source of low-enriched uranium is available to sustain
the continued operation of a nuclear reactor or U.S. nuclear energy
company." The Company expects President Joe Biden to sign the bill into
law in the coming days.
-- In anticipation of continued strength in uranium markets, the Company is
preparing two additional mines in Colorado and Wyoming (Whirlwind and
Nichols Ranch) for expected production in 2025. If market conditions
remain strong, the Whirlwind and Nichols Ranch mines could potentially
increase Energy Fuels' uranium production to a run-rate of over two
million pounds of U3O8 per year as early as 2025.
-- The Company is advancing permitting and other pre-development activities
on its large-scale Roca Honda, Sheep Mountain and Bullfrog uranium
properties for additional uranium production in the future, which could
expand the Company's uranium production to a run-rate of up to five
million pounds of U3O8 per year in the coming years.
-- The Company continues to evaluate uranium resource and development
acquisition and other potentially accretive opportunities as they may
arise.
-- As of May 1, the spot price of U3O8 was $92.00 per pound and the
long-term price of U3O8, which is the price most relevant for long-term
uranium sales contracts, was $80.00 per pound, according to data from
TradeTech.
Rare Earth Element Ramp-Up:
-- The Mill's REE production is complementary to its uranium production and
does not diminish the Mill's uranium capacity or production profile in
any way.
-- The development of the "Phase 1" REE Separation circuit at the Mill was
completed on-schedule at the end of Q1-2024, at a cost that is expected
to be $7 million to $9 million below the $25 million budget.
-- During Q2-2024, the Company expects to produce about 25 -- 35 tonnes of
separated neodymium praseodymium ("NdPr") oxide and 10 to 20 tonnes of a
"heavy" samarium plus ("SM+") mixed rare earth carbonate as it
commissions the Phase 1 REE Separation circuit, after which time the
Company expects to begin processing uranium ore and alternate feed
materials for the large-scale production of uranium at the Mill for the
remainder of the year and through mid-2026.
-- The Mill's Phase 1 REE separation circuit is expected to have the
capacity to produce approximately 800 to 1,000 tonnes of separated NdPr
oxide per year. For reference, 1,000 tonnes of NdPr can be used in enough
permanent REE magnets to power up to 1 million electric vehicles ("EVs")
per year. Subject to securing sufficient monazite feed, "Phase 1"
capacity is expected to position Energy Fuels in the coming years as one
of the world's leading producers of separated NdPr outside of China.
-- Due to the significant opportunity in REEs, Energy Fuels is engineering
further enhancements at the Mill to increase NdPr oxide production
capacity to approximately 4,000 tonnes -- 6,000 tonnes per year by 2027
("Phase 2"), and to add a separate crack and leach circuit to allow for
the simultaneous operation of the Mill's conventional ore and REE
processing circuits. The Company also intends to produce separated
dysprosium ("Dy"), terbium ("Tb") and potentially other advanced REE
materials in the future from monazite and potentially other REE process
streams by 2028 ("Phase 3"). Phase 2 and Phase 3 are subject to
permitting, financing and receipt of sufficient monazite feed.
-- To secure cost-effective and reliable supplies of monazite ore, Energy
Fuels is securing positions in several heavy mineral sand ("HMS")
deposits around the World, which produce monazite sand as a low-cost
byproduct of primary ilmenite and rutile (titanium) and zircon
(zirconium) production. Monazite sands are a rich source of the
'magnetic' REEs used in EVs and a variety of clean energy and advanced
technologies.
-- The Company has made significant progress in developing its Bahia HMS
project in Brazil (the "Bahia Project"). Based on preliminary, historical
resource estimates, the Company believes the Bahia Project has the
potential to supply approximately 3,000 -- 10,000 tonnes per year ("tpa")
of monazite sand concentrate to the Mill (depending on production rates),
containing approximately 1,500 -- 5,000 tonnes of total rare earth oxides
("TREO") per year potentially for decades.1 During the first half of
2023, the Company completed 2,266 meters of sonic drilling to confirm and
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