DGAP-News: Uranium Energy Corp.: Uranium Energy Corp Reports Fiscal 2012 Q1 Production Results and Provides Operations Update
(firmenpresse) - DGAP-News: Uranium Energy Corp. / Key word(s): Quarter Results
Uranium Energy Corp.: Uranium Energy Corp Reports Fiscal 2012 Q1
Production Results and Provides Operations Update
13.12.2011 / 15:00
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Uranium Energy Corp Reports Fiscal 2012 Q1 Production Results and Provides
Operations Update
Corpus Christi, TX, December 13, 2011 - Uranium Energy Corp (NYSE AMEX:
UEC, the 'Company') is pleased to report financial and production results
for the first quarter ended October 31, 2011. Major first quarter
highlights include the following:
- The Company completed its first uranium sale: UEC recorded revenue of
$3.1 million resulting from the sale of 60,000 pounds of U3O8 at an
average sales price of $52 per pound with an average cash cost per
pound sold of $14;
- Production for the Quarter: Production from Palangana totaled 67,000
pounds and the Hobson facility processed 69,000 pounds of U3O8 for a
cumulative cash cost of $18 per pound;
- Exploration and development activities at Palangana and Salvo continue;
- Coronel Oviedo Uranium Project in Paraguay: The Company initiated a
10,000-meter drilling program at its Coronel Oviedo Project in
Paraguay;
- The acquisition of the Anderson Project in Arizona was completed;
- The Workman Creek Project in Arizona was acquired; and
- The Company's balance sheet remains strong: As of October 31, 2011, UEC
had $23.7 million of cash in the treasury and 134,000 lbs. of U3O8
available for sale in inventory with a market value of $7.0 million.
Palangana Mine - Production Update
During the three months ended October 31, 2011, the Palangana Mine produced
67,000 pounds of U3O8. The Hobson facility processed 69,000 pounds of U3O8
for a cumulative cash cost(1) of $18 per pound, with a total of 194,000
pounds processed since the commencement of production to October 31, 2011.
The Company had 134,000 pounds of U3O8 available for sale in inventory
produced at an average cash cost (1) of $16 per pound, with a market value
of $7.0 million based on the average of the spot prices for uranium at
October 31, 2011.
The three-phase startup of Production Area-1 at the Palangana Mine is
continuing with the average depth of the wells at approximately 450 feet.
Production initially commenced at the Phase I wellfield (22 production and
27 injection wells) in November 2010, followed by the Phase II wellfield
(32 production and 22 injection wells) in April 2011, with the final Phase
III wellfield (21 production and 18 injection wells) having commenced
production in early October 2011.
Field crews are continuing to address performance variations with some
wells in the Phase I wellfield. A number of injection and production wells
here are being recompleted, and new wells are being drilled to assist in
extraction efficiencies. In Phase II, the wellfield is being evaluated to
improve production from areas that have remaining resources yet to be
recovered. As noted above, the Phase III wellfield commenced operations in
early October 2011 and is ramping up.
Production Area-2 wellfield drilling and casing commenced in November 2011.
A total of 72 wells are planned (36 injection and 36 production wells).
The first of two phases at PAA-2 is planned to start up in April 2012.
Palangana- Ongoing Exploration and Development
Exploration drilling continued throughout the first quarter at the
Palangana Project, with four drill rigs targeting several lightly explored
areas. Three mineralized trends were further delineated by drilling 66
holes. Ore-quality mineralization in these trends occurs between 300' to
600' in depth. Additional delineation drilling and coring are scheduled to
be conducted in these areas in the near future.
Additionally, four drill rigs completed delineation of the future
Production Area-3 wellfield during the first quarter. Thirty-three
delineation holes were drilled, followed by the installation of 18
perimeter monitor wells and 12 interior monitor wells in preparation for a
pump test which was conducted in November, with analytical results
anticipated in December.
Goliad Development Update
The Texas Commission on Environmental Quality (TCEQ) has continued to make
progress with the one remaining license needed to initiate construction at
the Goliad project, the Radioactive Materials License (RML). The Company
expects to have an update on the status of this license before the end of
the calendar year. Before the Company initiates in-situ recovery of uranium
at Goliad's Production Area One, the regional Environmental Protection
Agency must complete its review of and concur with the Aquifer Exemption
which has already been granted to the Company by TCEQ.
Salvo Exploration
Drilling resumed at the Salvo Project in October 2011 with two drill rigs
completing four exploration holes offsetting known mineralization. During
the first quarter, six additional leases were acquired totaling 724 acres.
Drilling is scheduled to continue throughout the year, and metallurgical
and other tests are also being performed to reaffirm ISR amenability at
Salvo. Management anticipates releasing drill results by March 2012.
Paraguay Update
In addition to the recently acquired 247,000-acre uranium property located
in the area of Coronel Oviedo, Paraguay, the Company entered into an
agreement to acquire a further six prospecting permits covering 740,000
acres in the same area. The Coronel Oviedo Project is geologically very
similar to the Company's projects in the South Texas uranium belt and is
anticipated to be ISR-amenable as initially indicated through pump-test
studies. With successful initial exploration here, the Company has
initiated a 10,000-meter drill program on this regional-scale project.
Financial Review
The following is a financial review of the Company for the three months
ended October 31, 2011, and should be read in conjunction with the
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 October 31, 2011, the Company recorded
revenue of $3.1 million resulting from the sale of 60,000 pounds of U3O8 at
an average sales price of $52.00 per pound. Cost of sales, including
royalties of $0.3 million, totaled $1.4 million or an average of $24.00 per
pound sold (cash cost (1) per pound sold of $14 excluding royalties).
During the three months ended October 31, 2011 ('2012 Q1') and 2010 ('2011
Q1'), the Company recorded a net loss of $5.6 million or $0.07 per share
compared to $8.9 million or $0.15 per share, respectively. Expenses for
2012 Q1 totaled $6.9 million (2011 Q1: $8.9 million) and include $2.7
million (2011 Q1: $3.4 million) for mineral property expenditures, $3.9
million (2011 Q1: $5.2 million) for general and administrative and $0.3
million (2011 Q1: $0.3 million) for depreciation, depletion and accretion.
-1- Cash costs are key indicators not defined under U.S. GAAP and are
non-GAAP measures. Cash costs exclude non-cash components comprised of
depreciation, depletion and stock-based compensation.
Liquidity
Net cash used in operating activities for 2012 Q1 was $4.8 million compared
to $6.3 million for 2011 Q1. Net cash used in financing activitiesfor
2012 Q1 was $1.0 million compared to net cash provided of $25.9 million for
2011 Q1. Net cash used in investing activities for 2012 Q1 was $1.3
million compared to $2.0 million for 2011 Q1. As of October 31, 2011, the
Company had cash and cash equivalents of $23.7 million and working capital
of $23.0 million.
Acquisitions Update
The downturn in the uranium market has provided the Company with an
excellent opportunity to make strategic acquisitions at attractive
discounts to historical valuations. The Company closed three transactions
during and subsequent to the first quarter.
Anderson Project in Arizona
On September 9, 2011, the Company and Concentric Energy Corp.
('Concentric') completed a stock-for-stock merger (the 'Merger') effected
under the laws of Nevada. Under the Merger, UEC issued 1,253,440 common
shares of the Company to the former Concentric stockholders to acquire
Concentric. The purpose of the Merger was to acquire Concentric's undivided
100% interest in the Anderson Project, a 7,581-acre mineral claim block
located in Yavapai County, Arizona, with a previous history of small-scale,
open-pit uranium production.
With the acquisition of the Anderson Project, UEC is now one of the leading
uranium players in Arizona, a business and energy-friendly state. Three of
the largest nuclear power plants in the U.S. are located there, with all
three plants having recently received their 20-year license extensions.
South Texas Uranium Exploration Data
On September 7, 2011, the Company completed the acquisition of a major
uranium exploration database covering the Goliad formation (the 'Database')
from Uranium One Inc. for consideration comprised of a cash payment of
$400,000 and the issuance of 159,326 restricted common shares of the
Company. This strategic database is anticipated to significantly advance
the Company's ongoing exploration efforts in South Texas.
Workman Creek Project in Arizona
On November 30, 2011, the Company completed the acquisition of an undivided
100% interest in the highly prospective 3,520-acre Workman Creek Project
located in Gila County, Arizona from Cooper Minerals, Inc. for
consideration of a cash payment of $84,640 and the issuance of 300,000
restricted common shares of the Company.
Uranium Market Update
During the Company's first quarter ending October 31, 2011, the spot price
of uranium increased from $51.50/lb. to $52.00/lb. according to the Ux
Consulting Company. The spot price is finding strong support in the low
$50's, and the longer term contract uranium price remains at $63.00/lb.
The worldwide nuclear build-out continues and the number of reactors
currently under construction totals 62 in 15 different countries. China,
India, Russia and South Korea continue to lead the global nuclear
build-out, and these governments have reaffirmed their commitment to
nuclear energy.
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 in the final stages of mine
permitting for production. 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 North America: Investor Relations, Uranium Energy Corp:
Toll Free: (866) 748-1030
Fax: (361) 888-5041
E-mail: info(at)uraniumenergy.com
Stock Exchange Information:
NYSE-AMEX: 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.
Under NI 43-101 an issuer may disclose an estimate of the quantity and
grade of a historical mineral resource made before the instrument came into
force if the estimate is an estimate of mineral resources prepared by or on
behalf of a person or company other than the issuer and the disclosure
identifies the source and date of the historical estimate, confirms that
the historical estimate is relevant, comments on its reliability, and
explains any differences between the categories used in the historical
resource and those permitted by NI 43-101. Any such resources are
historical in nature and were compiled before the implementation of NI
43-101 reporting standards, and the Company may not have independently
verified any such resource so is not treating them as current resources.
Any such historical resources were prepared to industry standards in place
at the time and are considered relevant today. Any such estimate, although
prepared by experienced personnel and considered relevant should not be
relied on.
Safe Harbor Statement
Except for the statements of historical fact contained herein, the
information presented in this news release constitutes 'forward-looking
statements' as such term is used in applicable United States and Canadian
laws. These statements relate to analyses and other information that are
based on forecasts of future results, estimates of amounts not yet
determinable and assumptions of management. Any other statements that
express or involve discussions with respect to predictions, expectations,
beliefs, plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
'expects' or 'does not expect', 'is expected', 'anticipates' or 'does not
anticipate', 'plans, 'estimates' or 'intends', or stating that certain
actions, events or results 'may', 'could', 'would', 'might' or 'will' be
taken, occur or be achieved) are not statements of historical fact and
should be viewed as 'forward-looking statements'. Such 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 expressed or implied by such forward-looking statements. Such
risks and other factors include, among others, the actual results of
exploration activities, variations in the underlying assumptions associated
with the estimation or realization of mineral resources, the availability
of capital to fund programs and the resulting dilution caused by the
raising of capital through the sale of shares, accidents, labor disputes
and other risks of the mining industry including, without limitation, those
associated with the environment, delays in obtaining governmental
approvals, permits or financing or in the completion of development or
construction activities, title disputes or claims limitations on insurance
coverage. Although the Company has attempted to identify important factors
that could cause actual actions, events or results to differ materially
from those described in forward-looking statements, there may be other
factors that cause actions, events or results not to be as anticipated,
estimated or intended. There can be no assurance that such statements will
prove to be accurate as actual results and future events could differ
materially from those anticipated in such statements. Accordingly, readers
should not place undue reliance on forward-looking statements contained in
this news release and in any document referred to in this news release.
Certain matters discussed in this news release and oral statements made
from time to time by representatives of the Company may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 and the Federal securities laws. Although the
Company believes that the expectations reflected in such forward-looking
statements are based upon reasonable assumptions, it can give no assurance
that its expectations will be achieved. Forward-looking information is
subject to certain risks, trends and uncertainties that could cause actual
results to differ materially from those projected. Many of these factors
are beyond the Company's ability to control or predict. Important factors
that may cause actual results to differ materially and that could impact
the Company and the statements contained in this news release can be found
in the Company's filings with the Securities and Exchange Commission. For
forward-looking statements in this news release, the Company claims the
protection of the safe harbor for forward-looking statements contained in
the Private Securities Litigation Reform Act of 1995. The Company assumes
no obligation to update or supplement any forward-looking statements
whether as a result of new information, future events or otherwise. This
press release shall not constitute an offer to sell or the solicitation of
an offer to buy securities.
End of Corporate News
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