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Cameco reports net earnings of C$89 million in 2022, uranium production up 70%

Kitco News

(Kitco News) - Cameco (TSX: CCO; NYSE: CCJ), one of the largest global producers of uranium fuel, today reported net earnings of C$89 million and adjusted net earnings of C$135 million in 2022.

The company said its annual results are "beginning to reflect the transition of our cost structure back to a tier-one run rate as contemplated by the continued execution of our strategy."

"Our results also reflect the improvement in average realized prices as uranium prices and conversion prices continue to increase catalyzed by geopolitical uncertainty and security of supply concerns," Cameco added.

The company also reported fourth quarter net loss of C$15 million and adjusted net earnings of C$36 million.

"Fourth quarter results are driven by normal quarterly variations in contract deliveries and the continued execution of our strategy," Cameco said.

In its uranium segment, the company delivered over 25 million pounds.

Production for 2022 was 10.4 million pounds in Cameco's uranium segment, up 70% from 2021, as Cigar Lake met its annual production target of 18 million pounds (100% basis) and McArthur River/Key Lake restarted operations producing 1.1 million pounds (100% basis).

In its fuel services segment, Cameco produced 13.0 million kgU, up 7% from 2021, which included an annual UF6 production record.

The company said that in 2022, it generated C$305 million in cash from operations, with higher sales volumes in its uranium segment and higher average realized prices in both the company's uranium and fuel services segments compared to 2021.

Cameco also reported that in 2022, the company received dividend payments from JV Inkai totaling US$93 million.

Importantly, the company noted that "record contracting secures long-term revenues and cash flows."

"In our uranium segment, in 2022, we added 80 million pounds to our portfolio of long-term uranium contracts, with a record number of contracts signed," it said.

Looking ahead, president and CEO Tim Gitzel said, "With the improvements in the market, the new long-term contracts we have put in place and our pipeline of contracting discussions, we are moving to the next phase of our supply discipline.

"Our plan will now be for McArthur River/Key Lake to produce 18 million pounds per year (100% basis) starting in 2024 and we will continue to operate Cigar Lake at its licensed capacity of 18 million pounds per year (100% basis) in 2024. At Inkai, production will continue to follow the 20% reduction planned by Kazatomprom (KAP) until the end of 2023. With annual licensed capacity of 25 million pounds at McArthur River/Key Lake, we continue to have the ability to expand production from our existing assets."

He added, "If we took advantage of all of the tier-one expansion opportunities available to us, our annual share of tier-one supply could be about 32 million pounds. However, any decision to expand production will be dependent on further improvements in the uranium market and our ability to secure the appropriate long-term contract homes for our unencumbered, in-ground inventory, demonstrating that we continue to responsibly manage our supply in accordance with our customers' needs."

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