Ur‐Energy Releases 2017 Q2 Results
News Release
10758 W. Centennial Rd. Suite 200
Littleton, CO 80127
Phone: 720.981.4588
Fax: 720.981.5643
www.ur-energy.com
Ur‐Energy Releases 2017 Q2 Results
Littleton, Colorado (PR Newswire – July 28, 2017) Ur‐Energy Inc. (NYSE American:URG, TSX:URE) (“Ur‐Energy”
or the “Company”) has filed the Company’s Form 10‐Q for the quarter ended June 30, 2017, with the U.S.
Securities and Exchange Commission at www.sec.gov/edgar.shtml and with Canadian securities authorities on
SEDAR at www.sedar.com.
Ur‐Energy Chairman Jeff Klenda observed, “Once again, we lowered our average cost per pound sold by
supplementing production with low‐cost purchases and delivering those pounds into our high‐priced, long‐term,
sales contracts. This strategy has enabled us to build inventory, generate cash and develop our second mine unit,
which is on time and under budget. In times of persistently low uranium prices, we have and will continue to take
full advantage of our high‐priced sales contracts, which continue into the next decade.”
Lost Creek Production and Sales
During the three months ended June 30, 2017, a total of 65,257 pounds of U3O8 were captured within the Lost
Creek plant. 70,833 pounds were packaged in drums and 74,406 pounds of the drummed inventory were shipped
to the conversion facility. We sold 241,000 pounds of U3O8 during the period of which 210,000 pounds were
purchased. Inventory, production and sales figures for the Lost Creek Project are presented in the following tables.
Production and Production Costs Unit 2017 Q2 2017 Q1 2016 Q4 2016 Q3 2017 YTD
Pounds captured lb 65,257 79,340 103,558 141,774 144,597
Ad valorem and severance tax $000 $ 227 $ 241 $ 247 $ 552 $ 468
Wellfield cash cost (1) $000 $ 599 $ 889 $ 864 $ 858 $ 1,488
Wellfield non‐cash cost (2) $000 $ 780 $ 776 $ 777 $ 778 $ 1,556
Ad valorem and severance tax per
pound captured $/lb $ 3.48 $ 3.04 $ 2.39 $ 3.89 $ 3.23
Cash cost per pound captured $/lb $ 9.18 $ 11.20 $ 8.34 $ 6.05 $ 10.29
Non‐cash cost per pound captured $/lb $ 11.95 $ 9.78 $ 7.50 $ 5.49 $ 10.76
Pounds drummed lb 70,833 74,382 111,049 145,893 145,215
Plant cash cost (3) $000 $ 1,270 $ 1,488 $ 1,336 $ 1,564 $ 2,758
Plant non‐cash cost (2) $000 $ 491 $ 491 $ 493 $ 495 $ 982
Cash cost per pound drummed $/lb $ 17.89 $ 20.00 $ 12.03 $ 10.72 $ 18.99
Non‐cash cost per pound drummed $/lb $ 6.93 $ 6.60 $ 4.44 $ 3.40 $ 6.77
Pounds shipped to conversion facility lb 74,406 72,643 98,775 149,540 147,049
Distribution cash cost (4) $000 $ 26 $ 47 $ 68 $ 86 $ 73
Cash cost per pound shipped $/lb $ 0.35 $ 0.65 $ 0.69 $ 0.58 $ 0.50
Pounds purchased lb 210,000 200,000 ‐ ‐ 410,000
Purchase costs $000 $ 4,870 $ 4,015 $ ‐ $ ‐ $ 8,885
Cash cost per pound purchased $/lb $ 23.19 $ 20.08 $ ‐ $ ‐ $ 21.67
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Notes:
1 Wellfield cash costs include all wellfield operating costs. Wellfield construction and development costs, which
include wellfield drilling, header houses, pipelines, power lines, roads, fences and disposal wells, are treated as
development expense and are not included in wellfield operating costs.
2 Non‐cash costs include the amortization of the investment in the mineral property acquisition costs and the
depreciation of plant equipment, and the depreciation of their related asset retirement obligation costs. The
expenses are calculated on a straight line basis so the expenses are typically constant for each quarter. The cost
per pound from these costs will therefore typically vary based on production levels only.
3 Plant cash costs include all plant operating costs and site overhead costs.
4 Distribution cash costs include all shipping costs and costs charged by the conversion facility for weighing, sampling,
assaying and storing the U3O8 prior to sale.
Sales and cost of sales Unit 2017 Q2 2017 Q1 2016 Q4 2016 Q3 2017 YTD
Pounds sold lb 241,000 250,000 100,000 200,000 491,000
U3O8 sales $000 $ 11,797 $ 14,819 $ 3,270 $ 9,471 $ 26,616
Average contract price $/lb $ 48.95 $ 59.28 $ 32.70 $ 47.36 $ 54.21
Average spot price $/lb $ ‐ $ ‐ $ ‐ $ ‐ $ ‐
Average price per pound sold $/lb $ 48.95 $ 59.28 $ 32.70 $ 47.36 $ 54.21
U3O8 cost of sales (1) $000 $ 6,573 $ 6,295 $ 3,082 $ 5,818 $ 12,868
Ad valorem and severance tax cost
per pound sold $/lb $ 4.26 $ 4.00 $ 2.98 $ 3.09 $ 4.09
Cash cost per pound sold $/lb $ 31.54 $ 26.12 $ 18.27 $ 17.50 $ 28.18
Non‐cash cost per pound sold $/lb $ 19.13 $ 15.48 $ 9.57 $ 8.50 $ 16.90
Cost per pound sold ‐ produced $/lb $ 54.93 $ 45.60 $ 30.82 $ 29.09 49.15
Cost per pound sold ‐ purchased $/lb $ 23.19 $ 20.08 $ ‐ $ ‐ 21.67
Average cost per pound sold $/lb $ 27.26 $ 25.18 $ 30.82 $ 29.09 $ 26.21
U3O8 gross profit $000 $ 5,224 $ 8,524 $ 188 $ 3,653 13,748
Gross profit per pound sold $/lb $ 21.68 $ 34.10 $ 1.88 $ 18.27 28.00
Gross profit margin % 44.3% 57.5% 5.7% 38.6% 51.7%
Ending Inventory Balances
Pounds
In‐process inventory lb 19,010 28,164 29,891 57,647
Plant inventory lb 10,446 14,019 12,274 ‐
Conversion facility inventory lb 160,094 113,528 84,689 84,808
Total inventory lb 189,550 155,711 126,854 142,455
Total cost
In‐process inventory $000 $ 352 $ 712 $ 897 $ 866
Plant inventory $000 $ 479 $ 670 $ 461 $ ‐
Conversion facility inventory $000 $ 6,620 $ 4,379 $ 2,751 $ 2,539
Total inventory $000 $ 7,451 $ 5,761 $ 4,109 $ 3,405
Cost per pound
In‐process inventory $/lb $ 18.46 $ 25.28 $ 30.01 $ 15.02
Plant inventory $/lb $ 45.85 $ 47.79 $ 37.56 $ ‐
Conversion facility inventory $/lb $ 41.35 $ 38.57 $ 32.48 $ 29.94
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Note:
1 Cost of sales include all production costs (notes 1, 2, 3 and 4 in the previous Production and Production Cost table)
adjusted for changes in inventory values.
U3O8 sales of $11.8 million for 2017 Q2 were based on selling 241,000 pounds at an average price of $48.95 into
term contract deliveries. We did not make any spot sales during the quarter. Of the 241,000 pounds sold, 31,000
were from produced inventory at a cost per pound sold of $54.93 and 210,000 were sold from purchased inventory
at a cost per pound sold of $23.19. For the quarter, our cost of sales totaled $6.6 million at an average cost of
$27.26 per pound.
The $54.93 cost per pound sold from produced inventory included a lower of cost or net realizable value
$456 thousand adjustment to our combined inventory during the quarter. The adjustment was largely driven by
the fixed nature of our non‐cash costs, which do not change regardless of the quantity of pounds produced, and
was charged to the cost of sales for the quarter. During the quarter, we only sold 31,000 pounds from production
and the charge amounted to an additional $14.71 per pound sold from produced inventory. Before the
adjustment, our total cost per pound sold from produced inventory was $40.13 and the cash cost component was
$24.16 per pound sold.
The gross profit from the sale of produced uranium for the quarter was $0.1 million, which represents a gross
profit margin of approximately four percent. Gross profit from the sale of purchased uranium was $5.1 million,
which represents a gross margin of approximately 51%. Total gross profit was $5.2 million, or approximately 44%.
Total Cost Per Pound Sold
Reconciliation 1 Unit 2017 Q2 2017 Q1 2016 Q4 2016 Q3 2017 YTD
Ad valorem & severance taxes $000 $ 227 $ 241 $ 247 $ 552 $ 468
Wellfield costs $000 $ 1,379 $ 1,665 $ 1,641 $ 1,636 $ 3,044
Plant and site costs $000 $ 1,761 $ 1,979 $ 1,829 $ 2,059 $ 37,408
Distribution costs $000 $ 26 $ 47 $ 68 $ 86 73
Inventory change $000 $ (1,690) $ (1,652) $ (703) $ 1,485 $ (3,342)
Cost of sales ‐ produced $000 $ 1,703 $ 2,280 $ 3,082 $ 5,818 $ 3,983
Cost of sales ‐ purchased $000 $ 4,870 $ 4,015 $ — $ — 8,885
Total cost of sales $000 $ 6,573 $ 6,295 $ 3,082 $ 5,818 12,868
Pounds sold produced lb 31,000 50,000 100,000 200,000 81,000
Pounds sold purchased lb 210,000 200,000 — — 410,000
Total pounds sold lb 241,000 250,000 100,000 200,000 491,000
Average cost per pound sold ‐
produced (1) $/lb $ 54.93 $ 45.60 $ 30.82 $ 29.09 $ 49.17
Average cost per pound sold ‐
purchased $/lb $ 23.19 $ 20.08 $ ‐ $ ‐ $ 21.67
Total average cost per pound
sold $/lb $ 27.27 $ 25.18 $ 30.82 $ 29.09 $ 26.21
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Note:
1 The cost per pound sold reflects both cash and non‐cash costs, which are combined as cost of sales in the
statement of operations included in this filing. The cash and non‐cash cost components are identified in the
above inventory, production and sales table.
The cost of sales includes ad valorem and severance taxes related to the extraction of uranium, all costs of
wellfield, plant and site operations including the related depreciation and amortization of capitalized assets,
reclamation and mineral property costs, plus product distribution costs. These costs are also used to value
inventory and the resulting inventoried cost per pound is compared to the estimated sales prices based on the
contracts or spot sales anticipated for the distribution of the product. Any costs in excess of the calculated market
value are charged to cost of sales.
Continuing Guidance for 2017
At the end of the second quarter of 2017, the average spot price of U3O8, as reported by Ux Consulting Company,
LLC and TradeTech, LLC, was approximately $20.15 per pound. Market fundamentals have not changed sufficiently
to warrant the accelerated development of Mine Unit 2 (“MU2”). We are developing MU2 at a controlled rate as
approved by our Board of Directors in the first quarter which will allow us to produce at a level that will satisfy a
portion of our term contracts.
For 2017, we have 600,000 pounds of U3O8 under contract at an average price of approximately $51 per pound.
We purchased 410,000 pounds during the first two quarters of the year and will purchase 109,000 pounds in the
third quarter for a total of 519,000 purchased pounds at an average cost of $21 per pound. The remaining 81,000
pounds were delivered from our produced inventory during the first two quarters of the year. We may make one
small spot sale later this year, which will be delivered from Lost Creek production. The spot sale will significantly
lower the average sales price from produced inventory that will be used to calculate the 2017 ad valorem and
severance taxes, which are based on total mine production for the year, and thereby significantly lower the
amount of taxes to be paid.
The 2017 Q3 production target for Lost Creek is between 60,000 and 70,000 pounds U3O8 dried and drummed.
Full year 2017 production guidance is unchanged at between 250,000 and 300,000 pounds. We do expect to bring
the first MU2 header house on line in 2017 Q3, but our production rate may be adjusted based on continuing
operational matters and other indicators in the market.
As at July 26, 2017, our unrestricted cash position was $7.6 million
About Ur‐Energy
Ur‐Energy is a uranium mining company operating the Lost Creek in‐situ recovery uranium facility in south‐
central Wyoming. We have produced, packaged and shipped more than two million pounds from Lost Creek
since the commencement of operations. Applications are under review by various agencies to incorporate our
LC East project area into the Lost Creek permits, and we have begun to submit applications for permits and
licenses to construct and operate at our Shirley Basin Project. Ur‐Energy is engaged in uranium mining, recovery
and processing activities, including the acquisition, exploration, development and operation of uranium mineral
properties in the United States. Shares of Ur‐Energy trade on NYSE American under the symbol “URG” and on
the Toronto Stock Exchange under the symbol “URE.” Ur‐Energy’s corporate office is in Littleton, Colorado; its
registered office is in Ottawa, Ontario. Ur‐Energy’s website is www.ur‐energy.com.
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FOR FURTHER INFORMATION, PLEASE CONTACT
Jeffrey Klenda, Chair and CEO
866‐981‐4588
Jeff.Klenda@ur‐energy.com
Cautionary Note Regarding Forward‐Looking Information
This release may contain “forward‐looking statements” within the meaning of applicable securities laws regarding events or
conditions that may occur in the future (e.g., results of Lost Creek production, including meeting production projections;
ability to maintain controlled production and development at Lost Creek; ability to deliver into existing contractual obligations
through a balance of production and purchased pounds) and are based on current expectations that, while considered
reasonable by management at this time, inherently involve a number of significant business, economic and competitive risks,
uncertainties and contingencies. Factors that could cause actual results to differ materially from any forward‐looking
statements include, but are not limited to, capital and other costs varying significantly from estimates; failure to establish
estimated resources and reserves; the grade and recovery of ore which is mined varying from estimates; production rates,
methods and amounts varying from estimates; delays in obtaining or failures to obtain required governmental, environmental
or other project approvals; inflation; changes in exchange rates; fluctuations in commodity prices; delays in development and
other factors described in the public filings made by the Company at www.sedar.com and www.sec.gov. Readers should not
place undue reliance on forward‐looking statements. The forward‐looking statements contained herein are based on the
beliefs, expectations and opinions of management as of the date hereof and Ur‐Energy disclaims any intent or obligation to
update them or revise them to reflect any change in circumstances or in management’s beliefs, expectations or opinions that
occur in the future.