Cameco reports first quarter results, solid quarter demonstrating the strength and purpose of our strategy; long-term contracting success in new markets; still early days of a market transition
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TSX: CCO website: cameco.com
NYSE: CCJ currency: Cdn (unless noted)
2121 – 11th Street West, Saskatoon, Saskatchewan, S7M 1J3 Canada
Tel: 306-956-6200 Fax: 306-956-6201
Cameco reports first quarter results, solid quarter demonstrating the strength and purpose of
our strategy; long-term contracting success in new markets; still early days of a market
transition
Saskatoon, Saskatchewan, Canada, April 28, 2023 . . . . . . . . . . . . . . . .
Cameco (TSX: CCO; NYSE: CCJ) today reported its consolidated financial and operating results for the first quarter ended
March 31, 2023, in accordance with International Financial Reporting Standards (IFRS).
“Our results demonstrate the strength and purpose of the strategic decisions we have made over the last several years, and
the continued support we see developing for nuclear power around the world. In fact, I am not sure there’s ever been a better
time to be a pure-play investment in the growing demand for nuclear energy. We remain in the enviable position of having
what we believe are the world’s premier, tier-one assets operating in a stable geopolitical region, and as McArthur River and
Key Lake continue to ramp up to planned production, we are returning to our tier-one cost structure,” said Tim Gitzel,
Cameco’s president and CEO.
“The world is recognizing the benefits of clean-air nuclear energy and the critical tool it can be in the fight against climate
change and in providing energy security. For example, we welcomed the joint statement from Natural Resources Canada and
the US Department of Energy at the end of March, announcing enhanced collaboration between our two nations with the goal
of diversifying the nuclear fuel supply chain. It addressed the need to work together globally as the world grapples with
providing safe, clean, reliable, affordable and secure energy. Furthermore, five of the G7 nations, including Canada, United
States, United Kingdom, Japan and France, have created an alliance to leverage their respective civil nuclear sectors. This
agreement will support the stable supply of nuclear fuels, as well as to support the nuclear fuel needs of future advanced
reactors. Whether its improving public support for nuclear power, policy decisions in support of nuclear being enacted, or
market-based solutions being pursued, there is increasing evidence to support full-cycle demand growth for nuclear power and
the uranium required to run reactors. The positive fundamentals we have talked about for nearly a decade are no longer just a
long-term story, they are right in front of us.
“Amid the heightened supply risk caused by geopolitical developments, utilities continue to evaluate their nuclear fuel supply
chains and are looking to diversify the origin of their supply. We are seeing increased competition among these utilities to
secure long-term contracts for uranium products and services with proven producers, who operate in geopolitically stable
jurisdictions, and who demonstrate strong environmental, social and governance performance. Companies like Cameco. Our
recent contracting success to supply new markets in Eastern Europe clearly demonstrates the desire of our customers to
diversify. These are markets where we were previously unable to compete. With these arrangements, we now have contract
commitments of approximately 215 million pounds of uranium and more than 70 million kgU of UF6 conversion services with
deliveries spanning more than a decade. Many of these contracts contain market-related pricing mechanisms, providing us
with exposure to an improving market. We also have a large and growing pipeline of business under discussion. As a result,
we remain very selective in committing our unencumbered, tier-one, in-ground inventory and UF6 conversion capacity under
long-term contracts, allowing us to maintain further market exposure.
“We believe we have the right strategy to achieve our vision of ‘energizing a clean-air world’ and we will do so in a manner that
reflects our values. Embedded in all our decisions is a commitment to addressing the environmental, social and governance
risks and opportunities that we believe will make our business sustainable over the long term.”
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• Transitioning to tier-one cost structure – net earnings of $119 million; adjusted net earnings of $115 million: first
quarter results are a result of higher deliveries and higher average realized prices in both the uranium and fuel services
segments as we continue the transition to our tier-one cost structure. In our uranium segment, our average realized price
was 11% higher than the same period last year, and in our fuel services segment average realized prices were 9% higher.
As expected, with 9.7 million pounds delivered, the first quarter represents almost a third of the total expected 2023
deliveries in our uranium segment, which is a departure from the pattern experienced in a low-price environment when
deliveries were heavily weighted to the fourth quarter. Adjusted net earnings is a non-IFRS measure, see page 4.
• Strong production performance: In our uranium segment we produced 4.5 million pounds (our share) during the quarter.
We continue to expect 20.3 million pounds of production in 2023 (our share). The production ramp up at McArthur
River/Key Lake is progressing well with 3.4 million pounds (2.4 million pounds our share) produced in the first quarter. We
continue to plan our production to align with our contract portfolio and customer needs.
• Long-term contracting – success in new markets: We now have total volumes under long-term contracts of
approximately 215 million pounds of uranium and more than 70 million kgU of UF6 conversion services with deliveries
spanning more than a decade, many of which have market-related pricing mechanisms. And, we continue to have a large
and growing pipeline of contract discussions underway. The recently announced long-term UF6 supply arrangements will
see us supply new markets well into the next decade.
• JV Inkai shipments: – In April, the second shipment containing 1.3 million pounds, representing the majority of our share
of Inkai’s remaining 2022 production, arrived at a Canadian port. We continue to work closely with JV Inkai and our joint
venture partner, Kazatomprom, to continue receiving our production share via the Trans-Caspian International Transport
Route, which does not rely on Russian rail lines or ports. In the event that it takes longer than anticipated using this shipping
route, we could experience delays in our expected Inkai deliveries this year. To mitigate this risk, we have inventory, long-
term purchase agreements and loan arrangements in place we can draw on. Depending on when we receive the shipment
of our share of Inkai’s 2023 production, our 2023 share of earnings from this equity accounted investee and the timing of
the receipt of our share of dividends from the joint venture may be impacted. See Uranium 2023 Q1 updates in our first
quarter MD&A for more information.
• 2023 guidance updated: We have updated our outlook for consolidated revenue, and uranium revenue, average realized
price and average unit cost of sales. See Outlook for 2023 in our first quarter MD&A for more information.
• Strong balance sheet: As of March 31, 2022, we had $2.5 billion in cash and cash equivalents and short-term investments
and $1.0 billion in long-term debt. The final financing for the Westinghouse acquisition will be determined based on our cash
balance, future expected cash flow generation, and market conditions at the time of close. We expect a permanent
financing mix of capital sources, including cash, debt and equity, designed to preserve our balance sheet and ratings
strength, while maintaining healthy liquidity. In addition, we have a $1 billion undrawn credit facility.
• Canada Revenue Agency (CRA) tax dispute: March 27, 2023, we announced that CRA issued revised reassessments for
the 2007 through 2013 tax years that it indicated would result in a refund of approximately $300 million of the $780 million in
cash and letters of credit being held by CRA. CRA advised that the refund would consist of $89 million in cash and the
return of $211 million in letters of credit. However, following the receipt of cash in the amount of $86 million on April 12,
2023, CRA informed us that its previous calculation of $89 million was incorrect. We continue to expect the return of letters
of credit in the amount of $211 million, which, if received and CRA’s calculations were correct, would bring the total refund
to $297 million. The timing of receipt of the letters of credit is yet to be determined.
• Received dividends from JV Inkai in April: On April 26, we received a dividend payment from JV Inkai totaling $79 million
(US). JV Inkai distributes excess cash, net of working capital requirements, to the partners as dividends.
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Consolidated financial results
THREE MONTHS
HIGHLIGHTS ENDED MARCH 31
($ MILLIONS EXCEPT WHERE INDICATED) 2023 2022 CHANGE
Revenue 687 398 73%
Gross profit 167 50 >100%
Net earnings attributable to equity holders 119 40 >100%
$ per common share (basic) 0.27 0.10 >100%
$ per common share (diluted) 0.27 0.10 >100%
Adjusted net earnings (non-IFRS, see page 4) 115 17 >100%
$ per common share (adjusted and diluted) 0.27 0.04 >100%
Cash provided by operations (after working capital changes) 215 172 25%
The financial information presented for the three months ended March 31, 2022, and March 31, 2023, is unaudited.
NET EARNINGS
The following table shows what contributed to the change in net earnings and adjusted net earnings (non-IFRS measure, see
page 4) in the first quarter of 2023, compared to the same period in 2022.
THREE MONTHS
ENDED MARCH 31
($ MILLIONS) IFRS ADJUSTED
Net earnings – 2022 40 17
Change in gross profit by segment
(We calculate gross profit by deducting from revenue the cost of products and services sold, and depreciation and amortization (D&A))
Uranium Impact from sales volume changes 16 16
Higher realized prices ($US) 24 24
Foreign exchange impact on realized prices 34 34
Lower costs 40 40
Change – uranium 114 114
Fuel services Impact from sales volume changes 3 3
Higher realized prices ($Cdn) 8 8
Higher costs (6) (6)
Change – fuel services 5 5
Other changes
Higher administration expenditures (6) (6)
Higher exploration expenditures (3) (3)
Change in reclamation provisions (18) (1)
Higher earnings from equity-accounted investee 14 14
Change in gains or losses on derivatives (8) (3)
Change in foreign exchange gains or losses 2 2
Higher finance income 26 26
Change in income tax recovery or expense (37) (40)
Other (10) (10)
Net earnings – 2023 119 115
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Non-IFRS measures
ADJUSTED NET EARNINGS
Adjusted net earnings (ANE) is a measure that does not have a standardized meaning or a consistent basis of calculation
under IFRS (non-IFRS financial measure). We use this measure as a more meaningful way to compare our financial
performance from period to period. Adjusted net earnings is our net earnings attributable to equity holders, adjusted to better
reflect the underlying financial performance for the reporting period. We believe that, in addition to conventional measures
prepared in accordance with IFRS, certain investors use this information to evaluate our performance. Adjusted net earnings is
one of the targets that we measure to form the basis for a portion of annual employee and executive compensation (see
Measuring our results in our 2022 annual MD&A).
In calculating ANE we adjust for derivatives. We do not use hedge accounting under IFRS and, therefore, we are required to
report gains and losses on all hedging activity, both for contracts that close in the period and those that remain outstanding at
the end of the period. For the contracts that remain outstanding, we must treat them as though they were settled at the end of
the reporting period (mark-to-market). However, we do not believe the gains and losses that we are required to report under
IFRS appropriately reflect the intent of our hedging activities, so we make adjustments in calculating our ANE to better reflect
the impact of our hedging program in the applicable reporting period. See Foreign exchange in our 2022 annual MD&A for
more information.
We also adjust for changes to our reclamation provisions that flow directly through earnings. Every quarter we are required to
update the reclamation provisions for all operations based on new cash flow estimates, discount and inflation rates. This
normally results in an adjustment to an asset retirement obligation asset in addition to the provision balance. When the assets
of an operation have been written off due to an impairment, as is the case with our Rabbit Lake and US ISR operations, the
adjustment is recorded directly to the statement of earnings as “other operating expense (income)”. See note 9 of our interim
financial statements for more information. This amount has been excluded from our ANE measure.
Adjusted net earnings is a non-IFRS financial measure and should not be considered in isolation or as a substitute for financial
information prepared according to accounting standards. Other companies may calculate this measure differently, so you may
not be able to make a direct comparison to similar measures presented by other companies.
The following table reconciles adjusted net earnings with net earnings for the first quarter and compares it to the same period
in 2022.
THREE MONTHS
ENDED MARCH 31
($ MILLIONS) 2023 2022
Net earnings attributable to equity holders 119 40
Adjustments
Adjustments on derivatives (6) (11)
Adjustments to other operating income (2) (19)
Income taxes on adjustments 4 7
Adjusted net earnings 115 17
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Selected segmented highlights
THREE MONTHS
ENDED MARCH 31
HIGHLIGHTS 2023 2022 CHANGE
Uranium Production volume (million lbs) 4.5 1.9 >100%
Sales volume (million lbs) 9.7 5.9 64%
Average realized price1 ($US/lb) 45.14 43.24 4%
($Cdn/lb) 60.98 55.05 11%
Revenue ($ millions) 594 322 84%
Gross profit ($ millions) 138 24 >100%
Fuel services Production volume (million kgU) 4.1 4.1 -
Sales volume (million kgU) 2.5 2.2 14%
Average realized price 2 ($Cdn/kgU) 37.66 34.49 9%
Revenue ($ millions) 92 76 21%
Gross profit ($ millions) 31 26 19%
1 Uranium average realized price is calculated as the revenue from sales of uranium concentrate, transportation and storage fees divided by the volume of uranium
concentrates sold.
2 Fuel services average realized price is calculated as revenue from the sale of conversion and fabrication services, including fuel bundles and reactor
components, transportation and storage fees divided by the volumes sold.
Management's discussion and analysis (MD&A) and financial statements
The first quarter MD&A and unaudited condensed consolidated interim financial statements provide a detailed explanation of
our operating results for the three months ended March 31, 2023, as compared to the same period last year. This news
release should be read in conjunction with these documents, as well as our audited consolidated financial statements and
notes for the year ended December 31, 2022, and annual MD&A, and our most recent annual information form, all of which are
available on our website at cameco.com, on SEDAR at sedar.com, and on EDGAR at sec.gov/edgar.shtml.
Qualified persons
The technical and scientific information discussed in this document for our material properties McArthur River/Key Lake, Cigar
Lake and Inkai was approved by the following individuals who are qualified persons for the purposes of NI 43-101:
MCARTHUR RIVER/KEY LAKE
• Greg Murdock, general manager, McArthur River,
Cameco
• Daley McIntyre, general manager, Key Lake, Cameco
CIGAR LAKE
• Lloyd Rowson, general manager, Cigar Lake, Cameco
INKAI
• Sergey Ivanov, deputy director general, technical
services, Cameco Kazakhstan LLP
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Caution about forward-looking information
This news release includes statements and information about our expectations for the future, which we refer to as forward-
looking information. Forward-looking information is based on our current views, which can change significantly, and actual
results and events may be significantly different from what we currently expect. Examples of forward-looking information in this
news release include: our views regarding nuclear power, its growth profile, and benefits, including fighting climate change and
providing energy security; our views regarding our tier one cost structure and impact of the ramp up of McArthur River/Key
Lake production on it; our views regarding uranium demand and supply, including the impact on the nuclear power industry of
geopolitical events; that we have a large and growing pipeline of contract discussions underway; our contracting strategy and
ability to maintain further market exposure; our vision of energizing a clean-air world and belief in our strategy for doing so in a
manner that reflects our values; our views regarding the long-term sustainability of our business; our view on our 2023 uranium
production level and McArthur River/Key Lake production ramp up; that we continue to plan our production to align with our
contract portfolio and customer needs; that we have inventory, long-term purchase agreements and loan arrangements in
place that we can draw upon to mitigate the risk of delay in 2023 expected Inkai deliveries; our expectation that we will be
refunded $211 million in letters of credit from CRA; and the expected date for announcement of our 2023 second quarter
results.
Material risks that could lead to different results include: unexpected changes in uranium supply, demand, long-term
contracting, and prices; changes in consumer demand for nuclear power and uranium as a result of changing societal views
and objectives regarding nuclear power, electrification and decarbonization; the risk that our views regarding nuclear power, its
growth profile, and benefits, may prove to be incorrect; the risk that we may not be able to achieve planned production levels
for Cigar Lake and McArthur River/Key Lake within the expected timeframes, or that the costs involved in doing so exceed our
expectations; the risk that the production levels at Inkai may not be at expected levels or that it may not be able to deliver its
production; the possibility that we do not receive the full amount, or any portion, of the expected refund of letters of credit from
the CRA or that refund is not made in a reasonable period of time; the risk that we may not be able to meet sales commitments
for any reason; the risks to our business associated with potential production disruptions, including those related to global
supply chain disruptions, global economic uncertainty, political volatility, labour relations issues, and operating risks; the risk
that we may not be able to implement our business objectives in a manner consistent with our environmental, social,
governance and other values; the risk that the strategy we are pursuing may prove unsuccessful, or that we may not be able to
execute it successfully; and the risk that we may be delayed in announcing our future financial results.
In presenting the forward-looking information, we have made material assumptions which may prove incorrect about: uranium
demand, supply, consumption, long-term contracting, growth in the demand for and global public acceptance of nuclear
energy, and prices; our production, purchases, sales, deliveries and costs; the market conditions and other factors upon which
we have based our future plans and forecasts; our contract pipeline discussions; our ability to mitigate adverse consequences
of delays in the shipment of our share of Inkai production; payment of the full expected refund of letters of credit from CRA; the
success of our plans and strategies, including planned production; the absence of new and adverse government regulations,
policies or decisions; that there will not be any significant adverse consequences to our business resulting from production
disruptions, including those relating to supply disruptions, economic or political uncertainty and volatility, labour relation issues,
and operating risks; and our ability to announce future financial results when expected.
Please also review the discussion in our 2022 annual MD&A and most recent annual information form for other material risks
that could cause actual results to differ significantly from our current expectations, and other material assumptions we have
made. Forward-looking information is designed to help you understand management’s current views of our near-term and
longer-term prospects, and it may not be appropriate for other purposes. We will not necessarily update this information unless
we are required to by securities laws.
Conference call
We invite you to join our first quarter conference call on Friday, April 28, 2023, at 8:00 a.m. Eastern.
The call will be open to all investors and the media. To join the call, please dial (800) 319-4610 (Canada and US) or (604) 638-
5340. An operator will put your call through. The slides and a live webcast of the conference call will be available from a link at
cameco.com. See the link on our home page on the day of the call.
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A recorded version of the proceedings will be available:
• on our website, cameco.com, shortly after the call
• on post view until midnight, Eastern, May 28, 2023, by calling (800) 319-6413 (Canada and US) or (604) 638-9010
(Passcode 9912)
2023 second quarter report release date
We plan to announce our 2023 second quarter results before markets open on August 2, 2023.
Profile
Cameco is one of the largest global providers of the uranium fuel needed to energize a clean-air world. Our competitive
position is based on our controlling ownership of the world’s largest high-grade reserves and low-cost operations. Utilities
around the world rely on our nuclear fuel products to generate safe, reliable, carbon-free nuclear power. Our shares trade on
the Toronto and New York stock exchanges. Our head office is in Saskatoon, Saskatchewan.
As used in this news release, the terms we, us, our, the Company and Cameco mean Cameco Corporation and its
subsidiaries unless otherwise indicated.
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Investor inquiries:
Rachelle Girard
306-956-6403
Media inquiries:
Veronica Baker
306-385-5541