DGAP-News: Uranium Energy Corp.: Uranium Energy Corp Reports Fiscal 2013 Q2 Production Results and Provides Operations Update
(firmenpresse) - DGAP-News: Uranium Energy Corp. / Key word(s): Miscellaneous
Uranium Energy Corp.: Uranium Energy Corp Reports Fiscal 2013 Q2
Production Results and Provides Operations Update
12.03.2013 / 14:15
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Uranium Energy Corp Reports Fiscal 2013 Q2 Production Results and Provides
Operations Update
Corpus Christi, TX, March 12, 2013 - Uranium Energy Corp (NYSE MKT: UEC,
the 'Company') is pleased to report financial and production results for
the second quarter ended January 31, 2013. Major second quarter highlights
include the following:
- Production Increased During the Quarter: Production from the Palangana
Mine increased to 48,000 pounds of U3O8 compared to 29,000 pounds the
previous quarter. The startup of Production Area-3 in early December
2012 provided for stronger production levels during the quarter,
especially for the month of January. This increase in production has
continued into fiscal Q3 with 28,000 pounds of U3O8 produced in
February 2013;
- Additional Production Areas at Palangana: Production Area-3 development
was completed and production commenced in December 2012, with
development and permitting activities continuing on Production Areas-4
and 5;
- The Goliad ISR Project is Fully Permitted for Production: In December
2012, final regulatory authorization was received to initiate
production at the now fully-permitted Goliad ISR Project. The project
is under construction with a three-phase electrical power system and a
large site pad having been completed. Procurement of processing
equipment and supplies for the construction of the satellite facility
and first production area are well underway;
- Sale of 50,000 Pounds U3O8 Generated Revenues of $2.1 Million: During
the quarter, the Company sold 50,000 pounds of U3O8 at $42 per pound
for gross proceeds of $2.1 million, with a cash cost per pound sold of
$31 excluding royalties. Cash cost per pound sold increased due
primarily to lower production volume, however, rising production levels
this quarter over the prior quarter are anticipated to reduce cash cost
per pound sold in future quarters;
- Cumulative Sales to Date: Cumulative sales of U3O8 since commencement
of production to January 31, 2013 total 370,000 pounds at a cash cost
per pound sold of $21 excluding royalties; and
- The Company's Balance Sheet Remains Strong: As of January 31, 2013, the
Company had $12.3 million of cash in the treasury and 36,000 pounds of
U3O8 available for sale in inventory with a market value of
approximately $1.6 million. The Company is a debt-free, 100%-unhedged
producer.
Palangana Mine - Production Update
During the six months ended January 31, 2013, the Palangana Mine produced
77,000 pounds of U3O8 from Production Areas-1, 2 and 3, and the Hobson
processing facility processed 83,000 pounds of U3O8. At January 31, 2013,
the Company had 36,000 pounds of U3O8 available for sale in inventory, with
a market value of approximately $1.6 million.
With production continuing at Production Areas-1 and 2, Production Area-3
commenced production in early December 2012. This resulted in an increase
in Palangana Mine production from 29,000 pounds of U3O8 the previous
quarter to 48,000 pounds this quarter, which is anticipated to reduce cash
cost per pound sold in future quarters. Development and permitting
activities are continuing on Production Areas-4 and 5 as described below.
Palangana Mine - Development and Permitting Update
At Production Areas-4 and 5, the Company completed collection of
environmental data to enlarge its mine area boundary, aquifer exemption
boundary and its radioactive material license area. Applications to expand
the boundaries are planned for calendar Q2 2013.
Production Area-4 monitor well drilling, baseline sampling and pumping
tests have been completed. A Production Area-4 application is expected to
be submitted in calendar Q2 2013.
Goliad ISR Project
The Goliad ISR Project is now fully permitted for production. In December
2012, the Company announced that the U.S. Environmental Protection Agency
concurred with the TCEQ issuance of the Aquifer Exemption permit. A
three-phase electrical power system for the entire project and a large
caliche site pad for the main plant complex and disposal well have been
constructed. Procurement of long-lead items including processing equipment
and supplies for the construction of the satellite facility and the first
production area are well underway.
Burke Hollow ISR Project Update
At the Burke Hollow Project, environmental data collection has commenced
and will continue throughout 2013. A drainage study has been completed and
an ecology, cultural resource and socioeconomic assessment is planned for
calendar Q2 2013. Regional baseline wells are also being installed for
groundwater data collection and permitting work is expected to be ramped up
in calendar Q2 2013.
Further exploration and development drilling is being planned, with
permitting activities already initiated to move the Burke Hollow ISR
Project immediately into the production pipeline, consistent with the
Company's hub-and-spoke production model for its South Texas assets.
South Texas Exploration and Development Update
Salvo ISR Project
At the Salvo Project, permits remain in compliance with the state
regulatory agencies, and restoration of drill sites has been approved after
regular inspections conducted by the Texas Railroad Commission.
A review of historic and recent drilling results completed by the Company
shows good potential for future resource development. Exploration and
delineation drilling is planned for the proposed Production Area-1 in the
future.
Channen Project
At the Channen Project, fourteen widely-spaced exploration holes drilled on
a 6,400-foot grid revealed that at least two lower Goliad sub-rolls lying
between 700 feet to 860 feet in depth exist on the property. Closer spaced
delineation holes reveal that the overall trend length known to date is
over two miles. These drilling results are being reviewed for future
exploration activities in the Channen Project in order to fully identify
the extent of the mineralized zones.
Paraguay ISR Projects
On October 15, 2012, the Company filed on SEDAR an NI 43-101 technical
report disclosing an exploration target at its Oviedo Project of 23-56
million pounds of U3O8 covering a grade range of 0.040% to 0.052% U3O8(1).
The technical report was created from the results of the Company's
10,000-meter drilling program on its Oviedo Project and the compilation of
historical and other geologic data. Company geologists are continuing to
perform detailed radon surveys over anomalous targets developed through
synthesis of historic and current exploration results. Work has continued
on the delineation of the radon anomalies that indicate the potential for
shallow uranium mineralization along basin margins.
The Company's Paraguay Yuty and Oviedo Projects, with geology that is very
similar to that of South Texas, have the potential to be large-scale
ISR-amenable uranium projects.
Financial Review
The following is a financial review of the Company for the three and six
months ended January 31, 2013, and should be read in conjunction with the
condensed consolidated financial statements and management's discussion and
analysis as contained in the Company's Form 10-Q filing available at the
Company's website at www.uraniumenergy.com or on EDGAR at www.sec.gov.
Results of Operations
During the three months ended January 31, 2013, the Company recorded
revenue of $2.1 million resulting from the sale of 50,000 pounds of U3O8 at
an average sales price of $42 per pound. Cash cost of sales excluding
royalties was $1.6 million or $31 per pound sold. Royalties were $0.2
million or $5 per pound sold and non-cash costs were $0.3 million or $6 per
pound sold. Total cost of sales was $2.1 million or $42 per pound sold
including royalties and non-cash costs, resulting in a gross profit of
$0.01 million.
During the six months ended January 31, 2013, the Company recorded revenue
of $4.3 million resulting from the sale of 100,000 pounds of U3O8 at an
average sales price of $43 per pound. Cash cost of sales excluding
royalties was $2.8 million or $28 per pound sold. Royalties were $0.5
million or $5 per pound sold and non-cash costs were $0.6 million or $6 per
pound sold. Total cost of sales was $3.9 million or $39 per pound sold
including royalties and non-cash costs, resulting in a gross profit of $0.3
million.
During the three months ended January 31, 2013, the Company recorded a net
loss of $5.6 million or $0.06 per share (2012 Q2: $6.5 million or $0.09 per
share). Expenses totaled $5.6 million (2012 Q2: $8.2 million) and include
$1.9 million (2012 Q2: $4.2 million) for mineral property expenditures,
$3.3 million (2012 Q2: $3.7 million) for general and administrative and
$0.4 million (2012 Q2: $0.3 million) for depreciation, amortization and
accretion.
During the six months ended January 31, 2013, the Company recorded a net
loss of $12.9 million or $0.15 per share (six months ended January 31,
2012: $12.1 million or $0.16 per share). Expenses totaled $13.2 million
(six months ended January 31, 2012: $15.1 million) and include $6.3 million
(six months ended January 31, 2012: $6.9 million) for mineral property
expenditures, $6.0 million (six months ended January 31, 2012: $7.6
million) for general and administrative and $0.9 million (six months ended
January 31, 2012: $0.6 million) for depreciation, amortization and
accretion.
Liquidity
Net cash used in operating activities for the six months ended January 31,
2013 was $11.8 million (six months ended January 31, 2012: $10.3 million).
Net cash used in financing activities for the six months ended January 31,
2013 was $0.0 million (six months ended January 31, 2012: $1.4 million).
Net cash used in investing activities for the six months ended January 31,
2013 was $0.9 million (six months ended January 31, 2012: $2.2 million).
At January 31, 2013, the Company had cash and cash equivalents of $12.3
million and working capital of $10.8 million.
Uranium Market Update
During the three months dating from October 31, 2012 through January 31,
2013, spot uranium prices strengthened, with a rise in the Ux Consulting
'Broker Average Price' from $40.63 per pound to $44.00 per pound U3O8.
Spot prices were reported within this range throughout the quarter and have
since pulled back to $42.25 per pound as of March 11, 2013. Meanwhile, the
Ux 'Long-Term' uranium contract price dropped $4.00 per pound from $60 to
$56 over the period.
Supply-demand fundamentals contain several catalysts that could strengthen
prices by the end of the current year. The expiration of the HEU agreement
in 2013 will remove about 24 million pounds of uranium from secondary
supply annually. The prospects for a rise in near-term demand improved as
China lifted the moratorium on new reactor builds and Prime Minister Shinzo
Abe was elected in Japan near the end of the year. Globally, there are 65
new reactors currently under construction that should add in excess of 30
million pounds of new demand annually. Compounding the longer term supply
deficit, several major production projects have been delayed or shelved as
a result of weak market conditions. Industry analysts estimate uranium
prices need to be in the $70-$80 range in order to spur investment to
develop new conventional mining projects.
About Uranium Energy Corp
Uranium Energy Corp is a U.S.-based uranium production, development and
exploration company operating North America's newest emerging uranium mine.
The Company's fully licensed and permitted Hobson processing facility is
central to all of its projects in South Texas, including the Palangana
in-situ recovery project, which is ramping up initial production, and the
Goliad in-situ recovery project which is now fully permitted and under
construction. The Company's operations are managed by professionals with a
recognized profile for excellence in their industry, a profile based on
many decades of hands-on experience in the key facets of uranium
exploration, development and mining.
Contact Uranium Energy Corp Investor Relations at:
Toll Free: (866) 748-1030
Fax: (361) 888-5041
E-mail: info(at)uraniumenergy.com
Stock Exchange Information:
NYSE MKT: UEC
Frankfurt Stock Exchange Symbol: U6Z
WKN: AØJDRR
ISN: US916896103
Notice to U.S. Investors
The mineral resources referred to herein have been estimated in accordance
with the definition standards on mineral resources of the Canadian
Institute of Mining, Metallurgy and Petroleum referred to in NI 43-101 and
are not compliant with U.S. Securities and Exchange Commission (the 'SEC')
Industry Guide 7 guidelines. In addition, measured mineral resources,
indicated mineral resources and inferred mineral resources, while
recognized and required by Canadian regulations, are not defined terms
under SEC Industry Guide 7 and are normally not permitted to be used in
reports and registration statements filed with the SEC. Accordingly, we
have not reported them in the United States. Investors are cautioned not to
assume that any part or all of the mineral resources in these categories
will ever be converted into mineral reserves. These terms have a great
amount of uncertainty as to their existence, and great uncertainty as to
their economic and legal feasibility. In particular, it should be noted
that mineral resources which are not mineral reserves do not have
demonstrated economic viability. It cannot be assumed that all or any part
of measured mineral resources, indicated mineral resources or inferred
mineral resources will ever be upgraded to a higher category. In
accordance with Canadian rules, estimates of inferred mineral resources
cannot form the basis of feasibility or other economic studies. Investors
are cautioned not to assume that any part of the reported measured mineral
resources, indicated mineral resources or inferred mineral resources
referred to in this news release are economically or legally mineable.
(1) In the Company's subject technical reports all tonnages, grade, and
contained pounds for exploration targets should not be construed to reflect
a calculated mineral resource (inferred, indicated, or measured). The
potential quantities and grades, as stated in the technical reports, are
conceptual in nature and there has been insufficient work to date to define
a NI 43-101 compliant resource. Furthermore, it is uncertain if additional
exploration will result in the discovery of an economic mineral resource on
the project.
Safe Harbor Statement
Certain information contained in this news release constitutes
'forward-looking statements' as such term is used in applicable United
States and Canadian laws. Generally, these forward-looking statements can
be identified by the use of forward-looking terminology such as 'expects'
or 'does not expect', 'is expected', 'anticipates' or 'does not
anticipate', 'plans', 'estimates', 'intends' or 'believes', or that certain
actions, events or results 'may', 'could', 'would', 'might' or 'will be
taken', 'occur', or 'be achieved'.
Forward-looking statements are based on the opinions and estimates of
management as of the date such statements are made, and are subject to
known and unknown risks, uncertainties and other factors that may cause the
actual results, performance or achievements of UEC to be materially
different from those expressed or implied by such forward-looking
statements. Many of these factors are beyond UEC's ability to control or
predict. Important factors that may cause actual results to differ
materially and that could impact UEC and the statements contained in this
news release can be found in UEC's filings with the SEC. Such risks and
other factors include, among others, variations in the underlying
assumptions associated with the estimation or realization of
mineralization, the availability of financing on acceptable terms,
accidents, labor disputes, acts of God and other risks of the mining
industry including, without limitation, risk of liability under
environmental protection legislation, delays in obtaining governmental
approvals or permits, title disputes or claims limitations on insurance
coverage. UEC believes that the expectations reflected in the
forward-looking statements included in this news release are reasonable;
however, no assurance can be given that these expectations will prove to be
correct, and such forward-looking statements should not be unduly relied
upon.
For forward-looking statements in this news release, UEC claims the
protection of the safe harbor for forward-looking statements contained in
the Private Securities Litigation Reform Act of 1995. UEC assumes no
obligation to update or supplement any forward-looking statements whether
as a result of new information, future events or otherwise.
End of Corporate News
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