enCore Energy Provides Q2 2024 Results and Operational Update
enCore Energy Provides Q2 2024 Results and Operational
Update
NASDAQ:EU
TSXV:EU
www.encoreuranium.com
DALLAS
,
Aug. 14, 2024
/CNW/ -
enCore Energy Corp.
(NASDAQ: EU) (TSXV: EU) (the "
Company
" or "
enCore"
), a
uranium producer, today reports results from the three and six month periods ended
June 30, 2024
. enCore continued to
enjoy rising revenue due to increasing production and sales of U
3
O
8
("yellowcake") in the first half of 2024. The Company
commissioned the Alta Mesa In-Situ Recovery ("ISR") Central Processing Plant and Wellfield ("Alta Mesa") late in the quarter
(
June 13, 2024
NR
) as its second uranium producing facility in
the United States
("US"), making enCore the only company
with two uranium facilities in the US currently producing yellowcake. The Company met its delivery commitments under
contracts with the delivery of 410,000 pounds, partially purchased and partially produced, of U
3
O
8
during the six month
period. enCore continued to move its pipeline of projects ahead with permitting activities in south
Texas
and preparation for a
drilling program in
Wyoming
.
Six Month Period Performance Highlights (in USD unless otherwise noted):
The Company recorded revenue of
$36 million
from the sale of yellowcake under sales contracts with nuclear utility
customers;
Uranium production commencement from two of its three plants in
Texas
within an eight-month time period making
enCore the only company currently producing uranium at more than one facility in the US;
Contract deliveries of 410,000 pounds of U
3
O
8
at an average sales price of
$87.11
per pound fully meeting the
Company's contractual commitments;
The Company entered its seventh uranium supply contract, in Q2 2024, with a US nuclear utility to deliver 200,000
pounds of U
3
O
8
per year in 2028 and 2029 using a pricing structure assuring inflation adjusted realized prices above
current spot prices presently in the low
$80
per pound range;
The Company continues uranium supply contract negotiations with US nuclear utilities with flexible inflation adjusted
pricing designed to assure the Company of known floor prices and allowing its participation in significant upward pricing.
Summary of Select Financial Highlights for the Quarter and Six Months Ended
June 30, 2024
and 2023:
(in thousands of US dollars)
3 months ended
6 months ended
June 30, 2024
June 30, 2023
June 30, 2024
June 30, 2023
Revenue and other income:
5,320
*
35,714
*
Cost of goods sold
8,323
*
36,374
*
Gross Profit
(3,003)
*
(660)
*
Expenses (Detail below)
6,359
7,014
16,111
14,747
Loss from Operations
9,362
7,014
16,771
14,747
Currency translation of
Subsidiaries
1,369
(527)
5,024
(1,197)
Comprehensive Loss
Attributable to enCore
Shareholders:
9,624
6,990
18,499
13,795
Loss per share
(0.05)
(0.06)
(0.08)
(0.11)
*
In 2023, the Company recorded a gain of $858,000 on the sale of its uranium investment for the three months ended June 30, and a gain of $1,959,000 for the six months ended June 30. This income was classified as
investment income, rather than revenue, as the company had not yet commenced production.
Revenue Discussion
The Company's sales of 410,000 pounds of yellowcake were sourced from both purchased pounds and those produced at its
Rosita In-Situ Recovery ("ISR") Central Processing Plant ("Rosita"). These purchased pounds increased the cost of goods
sold. As Alta Mesa came on-line late in Q2 there were no sales of product from Alta Mesa. Revenues are expected to
increase materially during the second half of the year with Alta Mesa's production being the major source of this expected
increase.
Expense Discussion
The increase in expenses is primarily due to activity associated with the start-up of Alta Mesa. Operational start-up
inefficiencies at the Rosita Extension Wellfield also adversely affected expenses. With both facilities in the early phases of
start-up, they have incurred accelerated expenses and investments crucial to fully achieving our growth strategy and meeting
our operational capacity.
Alta Mesa Q2 Performance
On
June 13, 2024
the Company announced initial production from Alta Mesa. As this production commenced with only
seventeen days remaining in the second quarter, no dried uranium was inventoried during the quarter. Average wellfield
solution head grades of 120 mg/L U
3
O
8
achieved during the last two weeks of the quarter indicated productivity at levels
exceeding our expectations. Drilling has been continuous at Alta Mesa as the Company plans on systematically increasing
the number of injection and production wells producing in phases through the end of the year and beyond.
Outlook and Subsequent Events
The Company's outlook is positive with significant and increasing revenue from Alta Mesa production contributing to financial
results in the second half of 2024 and beyond as additional production wells are completed. The cost/revenue ratio is
projected to decline as the Company increases production from Alta Mesa and to a lesser extent Rosita for the remainder of
the year. This trend is projected to accelerate as the Company expects to reach and exceed one million pounds a year
production rate in 2025.
Additional plant feed for Rosita will be developed at the Upper Spring Creek Project where the Company has submitted
various permit and amendment applications to the regulatory authorities in anticipation of a first half start-up in 2025. Detailed
confirmation drilling along with monitor and base well installation will commence before the end of Q3 2024.
The nuclear industry outlook remains extremely positive with demand projections outpacing supply for the foreseeable future
driven in part by increased electrical demand from Artificial Intelligence ("AI") and the commitment of many sectors of the
economy to achieve zero carbon. Regulatory actions and permitting delays, which restrict or withdraw large uranium deposits
from development and production, combined with geopolitical tensions, provide a positive backdrop for uranium pricing.
Current contracting conditions remain favorable, with contract pricing now higher at a spot price in the low $80s than it was
when the spot price reached its twelve-month high of
$115
per pound.
Qualified Person
John M. Seeley
, Ph.D., P.G., C.P.G., enCore's Manager of Geology and Exploration, and a Qualified Person under NI 43-
101, has reviewed and approved the technical disclosure in this news release on behalf of the Company.
Shareholder Information
The Company's full quarterly and annual filings are available on SEDAR+ at
www.sedarplus.ca
, on the U.S. Securities and
Exchange Commission's EDGAR website at
www.sec.gov
and on enCore's website at
www.encoreuranium.com
. Financial
results were prepared in accordance with International Financial Reporting Standards, as issued by the International
Accounting Standards Board.
About enCore Energy Corp.
enCore Energy Corp., America's Clean Energy Company™, is committed to providing clean, reliable, and affordable fuel for
nuclear energy as the only
United States
uranium producer with multiple production facilities in operation. The enCore team is
led by industry experts with extensive knowledge and experience in all aspects of In-Situ Recovery ("ISR") uranium operations
and the nuclear fuel cycle. enCore solely utilizes ISR for uranium extraction, a well-known and proven technology co-
developed by the leaders at enCore Energy.
Following upon enCore's demonstrated production success in
South Texas
, future projects in enCore's production pipeline
include the Dewey-Burdock project in
South Dakota
and the Gas Hills project in Wyoming. The Company holds other assets
including significant
New Mexico
resources, non-core assets and proprietary databases. enCore is committed to working with
local communities and indigenous governments to create positive impact from corporate developments.
www.encoreuranium.com
Cautionary Note Regarding Forward Looking Statements:
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this release.
Certain information contained in this news release, including: any information relating to the Company being a leading
uranium company, statements regarding future or potential production, statements regarding the Company's anticipated
increase in revenue from Alta Mesa production, statements regarding the Company's projected cost/revenue ratio,
statements regarding future plant feed development for Rosita, future nuclear industry outlook, and any other statements
regarding future expectations, beliefs, goals or prospects; may constitute "forward-looking information" and "forward-
looking statements" within the meaning of applicable Canadian and
United States
securities laws and regulations
(collectively, "forward-looking statements").
All statements in this news release that are not statements of historical fact
(including statements containing the words "expects", "is expected", "does not expect", "plans", "anticipates", "does not
anticipate", "believes", "intends", "estimates", "projects", "potential", "scheduled", "forecast", "budget" and similar
expressions or variations (including negative variations) of such words and phrases, or statements that certain actions,
events or results "may", "could", "would", "might" or "will" be taken) should be considered forward-looking statements. All
such forward-looking statements are subject to important risk factors and uncertainties, many of which are beyond the
Company's ability to control or predict. Forward-looking statements necessarily involve known and unknown risks,
including, without limitation, risks associated with general economic conditions; adverse industry events; future legislative
and regulatory developments; the ability of enCore to implement its business strategies; including achieving expected
levels of production at Rosita and Alta Mesa in the planned time frame or at all; and other risks. A number of important
factors could cause actual results or events to differ materially from those indicated or implied by such forward-looking
statements, including without limitation exploration and development risks, changes in commodity prices, access to skilled
mining personnel, the results of exploration and development activities; production risks; uninsured risks; regulatory risks;
defects in title; the availability of materials and equipment, timeliness of government approvals and unanticipated
environmental impacts on operations; litigation risks; risks posed by the economic and political environments in which the
Company operates and intends to operate; increased competition; assumptions regarding market trends and the expected
demand and desires for the Company's products and proposed products; reliance on industry equipment manufacturers,
suppliers and others; the failure to adequately protect intellectual property; the failure to adequately manage future growth;
adverse market conditions, the failure to satisfy ongoing regulatory requirements and factors relating to forward looking
statements listed above which include risks as disclosed in the Company's annual information form filings. Should one or
more of these risks materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual
results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected.
The Company assumes no obligation to update the information in this communication, except as required by law. Additional
information identifying risks and uncertainties is contained in filings by the Company with the various securities
commissions which are available online at
www.sec.gov
and
www.sedarplus.ca
. Forward-looking statements are provided
for the purpose of providing information about the current expectations, beliefs and plans of management. Such statements
may not be appropriate for other purposes and readers should not place undue reliance on these forward-looking
statements, that speak only as of the date hereof, as there can be no assurance that the plans, intentions or expectations
upon which they are based will occur. Such information, although considered reasonable by management at the time of
preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking
statements contained in this news release are expressly qualified by this cautionary statement.
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SOURCE
enCore Energy Corp.
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%SEDAR: 00029787E
For further information:
For further information: William M. Sheriff, Executive Chairman, 972-333-2214,
CO: enCore Energy Corp.
CNW 07:00e 14-AUG-24