Ur-Energy Releases 2020 Year End 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 2020 Year End Results
Littleton, Colorado (ACCESSWIRE – February 26, 202 1) Ur-Energy Inc. (NYSE
American:URG)(TSX:URE) (“Ur-Energy” or the “Company”) has filed the Company’s Annual Report on
Form 10-K, Consolidated Financial Statements, and Management’s Discussion & Analysis, all for the year
ended December 31, 2020, with the U.S. Securities and Exchange Commission on EDGAR at
www.sec.gov/edgar.shtml and with Canadian securities authorities on SEDAR at www.sedar.com . These
filings also may be accessed on the Company’s website at www.ur-energy.com. Shareholders of the Company
may receive a hard copy of the consolidated financial statements, free of charge, upon request to the Company.
Ur-Energy CEO, Jeff Klenda said : “We look forward to 2021 as a year with numerous prospective catalysts
for the domestic uranium recovery industry – catalysts from which our proven operational results at Lost Creek
position us to benefit . We are pleased that , already, the Biden Administration has committed to integrate
nuclear energy into its clean energy mandate, which is coupled with its pledge, expressed just this week, to
‘expand and strengthen domestic mining and processing capacity’ of the U.S. These priorities, and the growing
bipartisan support for nuclear energy, will facilitate the formation of the national uranium reserve approved in
December 2020, as well as implementation of other recommendations of the U .S. Nuclear Fuel Working
Group.
“At February 24, we had $18.6 million in cash, allowing us to maintain and strengthen our operational
readiness at Lost Creek to return to full production levels when conditions warrant. Additionally, we have
nearly 285,000 pounds U3O8 in inventory at the conversion facility. Our experienced technical and operational
staff continues to optimize processes and future production plans at the site. We await the formal establishment
of the uranium reserve to respond to the procurement proces s. We stand ready to provide Lost Creek’s
production inventory to the reserve to further its purposes in protecting our energy and national security.”
Financial Results
As of December 31, 2020, we had cash resources consisting of cash and cash equivalents of $4.3 million.
Excluding NRV adjustments , w e recognized a gross profi t related to U 3O8 sales of $3.1 million, which
represents a gross profit margin of approximately 38 percent. The Company realized an average price per
pound U3O8 sold of $41.50, as compared to $48.50 in 2019. The sales were all from term contracts.
Lost Creek Operations
As in recent years, controlled production operations continued at Lost Creek throughout 2020. The originally
planned wells and HHs in MU1 and the first three HHs and the related wells in MU2 were available for
operation through much of 2020, until we further reduced our production levels in Q3 2020.
During 2020, 10,789 pounds of U3O8 were captured within the Lost Creek plant and 15,873 pounds U3O8 were
packaged in drums. At December 31, 2020, inventory at the conversion facility was approximately 268,485
pounds. Subsequent to year-end, we delivered an additional shipment to the conversion facility. Currently, we
have approximately 284,358 pounds in inventory at the conversion facility.
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Lost Creek MU1 and MU2 have all appropriate operating permits. The mai n trunkline that services the first
five MU2 HHs has been installed, and the entirety of MU2 has been fenced. In addition, during the most recent
development program, approximately 45% of the required wells for HH2-4 have been drilled and cased. These
earlier development activities in MU2 will allow for a quick ramp up of production once market fundamentals
change.
The following tables provide detailed financial information on our sales, cost of sales , and production and
ending inventory as they relate to U3O8 pounds. The U3O8 and cost per pound measures included in the
following tables do not have a standardized meaning within US GAAP or a defined basis of calculation.
These measures are used by management to assess business performance and determine production and pricing
strategies. They may also be used by certain investors to evaluate performance. Where applicable,
reconciliation of these measures to US GAAP financial statement presentation are included within the
respective table.
Sales
Note:
1. Sales per the financial statements include revenues from disposal fees received at Shirley Basin. The
disposal fees do not relate to U 3O8 pounds sold and are excluded from the U 3O8 sales and U3O8 price
per pound sold figures.
Unit 2020 2019 2018
U3O8 Sales Reconcilation (1)
Sales per financial statements $000 8,316$ 32,255$ 23,496$
Disposal fees $000 (16)$ (4)$ (43)$
U3O8 sales $000 8,300$ 32,251$ 23,453$
U3O8 pounds sold lb 200,000 665,000 480,000
U3O8 price per pound sold $/lb 41.50$ 48.50$ 48.86$
U3O8 Sales by Product
U3O8 Sale s
Produced $000 -$ 9,889$ 238$
Purchased $000 8,300$ 22,362$ 23,215$
$000 8,300$ 32,251$ 23,453$
U3O8 Pounds Sold
Produced lb - 213,750 10,000
Purchased lb 200,000 451,250 470,000
lb 200,000 665,000 480,000
U3O8 Price per Pounds Sold
Produced $/lb -$ 46.26$ 23.80$
Purchased $/lb 41.50$ 49.56$ 49.39$
$/lb 41.50$ 48.50$ 48.86$
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Cost of Sales
Note:
1. Cost of sales per the financial statements include lower of cost or net realizable value (“NRV”)
adjustments. The NRV adjustments do not relate to U 3O8 pounds sold and are excluded from the
U3O8 cost of sales and U3O8 cost per pound sold figures.
Cost of sales per the financial statements includes ad valorem and severance taxes related to the extraction of
uranium, all costs of wellfield and plant 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. The resulting inventoried cost per pound is compared to the NRV of the product,
Unit 2020 2019 2018
U3O8 Cost of Sales Reconciliation (1)
Cost of sales per financial statements $000 12,968$ 30,274$ 12,203$
Lower of cost or NRV adjustment $000 (7,802)$ (10,264)$ (318)$
U3O8 cost of sales $000 5,166$ 20,010$ 11,885$
U3O8 pounds sold lb 200,000 665,000 480,000
U3O8 cost per pound sold $/lb 25.83$ 30.09$ 24.76$
U3O8 Cost of Sales by Product
U3O8 Cost of Sales
Ad valorem and severance taxes $000 29$ 82$ 423$
Wellfield cash costs $000 422$ 882$ 2,068$
Wellfield non-cash costs $000 2,289$ 2,445$ 1,603$
Plant cash costs $000 3,393$ 4,395$ 4,719$
Plant non-cash costs $000 1,958$ 1,954$ 1,955$
Distribution costs $000 1$ 71$ 136$
Inventory change $000 (8,092)$ (1,744)$ (10,495)$
Produced $000 -$ 8,085$ 409$
Purchased $000 5,166$ 11,925$ 11,476$
$000 5,166$ 20,010$ 11,885$
U3O8 Pounds Sold
Produced lb - 213,750 10,000
Purchased lb 200,000 451,250 470,000
lb 200,000 665,000 480,000
U3O8 Cost per Pound Sold
Produced $/lb -$ 37.82$ 40.90$
Purchased $/lb 25.83$ 26.43$ 24.42$
$/lb 25.83$ 30.09$ 24.76$
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which is based on the estimated sales price of the product, net of any remaining costs to finish the product.
Any inventory value in excess of the NRV is charged to cost of sales per the financial statements. These NRV
adjustments are excluded from the U3O8 cost of sales and U3O8 cost per pound sold figures because they relate
to the pounds of U3O8 in ending inventory and do not relate to the pounds of U3O8 sold during the period.
U3O8 Production and Ending Inventory
During 2020, we took steps to further reduce production operations at Lost Creek and adjust to the continued
depressed state of the uranium markets while we awaited the recommended relief from the Working Group
and further positive developments in the uranium markets. As a result, production rates at Lost Creek declined
during the year. Pounds captured decreased nearly 80 percent during the year and will remain low until a
Unit 2020 2019 2018
U3O8 Production
Pounds captured lb 10,789 47,957 302,164
Pounds drummed lb 15,873 50,794 286,357
Pounds shipped lb - 58,353 287,873
Pounds purchased lb 200,000 500,000 470,000
U3O8 Ending Inventory
Pounds
In-process inventory lb 303 5,396 9,134
Plant inventory lb 15,873 - 7,559
Conversion inventory - produced lb 219,735 220,053 375,803
Conversion inventory - purchased lb 48,750 48,750 -
lb 284,661 274,199 392,496
Value
In-process inventory $000 -$ -$ 160$
Plant inventory $000 463$ -$ 345$
Conversion inventory - produced $000 6,083$ 6,250$ 14,187$
Conversion inventory - purchased $000 1,268$ 1,176$ -$
$000 7,814$ 7,426$ 14,692$
Cost per Pound
In-process inventory $/lb -$ -$ 17.52$
Plant inventory $/lb 29.17$ -$ 45.64$
Conversion inventory - produced $/lb 27.68$ 28.40$ 37.75$
Conversion inventory - purchased $/lb 26.01$ 24.12$ -$
$/lb 27.45$ 27.08$ 37.43$
Produced conversion inventory detail:
Ad valorem and severance tax $/lb 0.75$ 0.77$ 1.52$
Cash cost $/lb 17.50$ 17.95$ 23.85$
Non-cash cost $/lb 9.43$ 9.68$ 12.38$
$/lb 27.68$ 28.40$ 37.75$
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decision to ramp up is made. Pounds drummed decreased similarly. There were no shipme nts in 2020 as we
accumulated enough product for the next shipment, which was made in January 2021.
At the end of the year, we had approximately 268,485 pounds of U 3O8 at the conversion facility including
219,735 produced pounds at an average cost per pound of $27.68, and 48,750 purchased pounds at an average
cost of $26.01 per pound. Including the January 2021 shipment, we have approximately 284,358 pounds of
U3O8 at the conversion facility including 235,608 produced pounds.
Year Ended December 31, 2020 Compared to Year Ended December 31, 2019
The following table summarizes the results of operations for the years ended December 31, 2020 and 2019:
(expressed in thousands of U.S. dollars, except per share and pound data)
Y ear ended
December 31,
2020 2019
Sales 8,316 32,255
Cost of sales (12,968) (30,275)
Gross profit (loss) (4,652) 1,980
Operating costs (8,689) (10,258)
Profit (loss) from operations (13,341) (8,278)
Net interest ex pense (710) (668)
Warrant mark to market gain (680) 524
Foreign ex change gain (loss) (72) (28)
Other income (ex pense) 18 32
Net income (loss) (14,785) (8,418)
Foreign currency translation adjustm ent 53 (16)
Comprehensiv e income (loss) (14,732) (8,434)
Incom e (loss) per com m on share:
Bas ic (0.09) (0.05)
Diluted (0.09) (0.05)
U3O8 pounds sold 200,000 665,000
U3O8 price per pounds sold 41.50 48.50
U3O8 cost per pounds sold 25.83 30.09
U3O8 gross per pounds sold 15.67 18.41
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2021 Guidance
Following multiple announcements of industry production suspensions and reductions in 2020, U 3O8 spot
prices increased to $33 per pound, but subsequently decreased to approximately $30 per pound at year- end.
More recently, recognition of nuclear power’s role in achieving net -zero carbon emissions goals has seen a
renewed interest in the uranium sector. The Paris Climate Agreement calls for net -zero carbon emissions by
2050 and the U.S. has rejoined the agreement under the Biden Administration, which has indicated support for
the nuclear industry.
In February 2021, we raised gross proceeds of $15.2 million through an underwritten public offering. Our
current cash position as of February 24, 2021, is $18.6 million. In addition to our strong cash position, w e
have nearly 285,000 pounds of finished, ready-to-sell inventory, worth $8.0 million at recent spot prices. The
financing provides us adequate funds to maintain and enhance operational readiness, for possible future
acquisitions, and for general working capital purposes, including the preservation of our existing inventory for
higher prices.
In addition to the restructuring of the State Bond Loan, we implemented other Company-wide cost -saving
measures during 2020. We further reduced production operations at Lost Creek to market -appropriate levels.
The reduced production levels allowed us to make further operating cost reductions at Lost Creek and related
support cost reductions at the corporate office. The cost reductions include savings from additional reductions
in force and other cost containment measures. Together with the further deferral of principal payments on the
State Bond Loan, these measures will result in substantial savings to the Company, estimated to exceed
$7 million and $4 million in calendar years 2021 and 2022, respectively.
Our remaining highly experienced technical and operational staff will continue to optimize processes and
refine production plans, which strengthens our operational readiness at the fully permitted Lost Creek mine
and plant. The Lost Creek facility has the constructed and licensed capacity to process up to two million pounds
of U3O8 per year and previously reported mineral resources to feed the processing plant for many years to
come. A ramp-up of production at Lost Creek would initially include further development work in the first two
mine units, followed by the ten additional mining areas as defined in the Lost Creek Property Preliminary
Economic Assessment, as amended. In 2021, we expect to receive all permits and a uthorizations to recover
uranium from the adjacent LC East project where certain of those additional mining areas are located.
We remain prepared to expand uranium production at Lost Creek to an annualized run rate of one million
pounds. With future development and construction in mind, our current staff members were retained as having
the greatest level of experience and adaptability allowing for an easier transition back to full operations. Lost
Creek operations can increase to full production rates in as little as six months following a go decision, simply
by developing additional header houses within the fully permitted MU2. Development expenses during this
six-month ramp up period are estimated to be approximately $14 million and are almost entirely re lated to
MU2 drilling and header house construction costs. We are prepared to ramp up and to deliver our Lost Creek
production inventory to the new national uranium reserve.
Additionally, we stand ready to construct our Shirley Basin mine, where we estima te up to nine years
production based upon the mineral resources reported in the Shirley Basin Preliminary Economic Assessment.
All remaining permits and authorizations to construct and operate this in situ recovery site are expected to be
received in 2021 H1.
We will continue to closely monitor the uranium market and any actions or remedies resulting from the
Working Group’s report, the implementation of the uranium reserve program, or any further legislative actions,
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which may positively impact the uranium production industry. Until such time, we will continue to minimize
costs and maximize the ‘runway’ to maintain our current operations and the operational readiness needed to
ramp-up production when called upon.
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 2.6 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 to 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
the 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.
FOR FURTHER INFORMATION, PLEASE CONTACT
Jeffrey Klenda, Chair & CEO
866-981-4588
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., what the catalysts for the uranium recovery
industry will be in 2021 and when any of them may be realized; our ability to control production operations at
lower levels at Lost Creek in a safe and compliant manner; ability and timing to receive all remaining permits
and authorizations related to our LC East and Shirley Basin projects; the timing to determine future
development and construction priorities, and the ability to readily and cost -effectively ramp-up production
operations when market and other conditions warrant; the ability of the Biden Administration to advance their
climate change and clean energy agenda , its timing and whether meaningful changes for nuclear power
positively affect the domestic uranium recovery industry; the timing and program details for establishment of
the new national uranium reserve and continuing budget appropriations for the ten-year program; and further
implementation of recommendations from the U.S. Nuclear Fuel Working Group, including the timeline and
scope of proposed remedies and related budget appropriations processes) 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; producti on 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.