LAKEWOOD, Colo., March 22, 2021 /CNW/ - Energy Fuels
Inc. (NYSE: UUUU); (TSX: EFR) ("Energy Fuels" or the
"Company") today reported its financial results for the
year ended December 31, 2020. The
Company's annual report on Form 10-K has been filed with the U.S.
Securities and Exchange Commission ("SEC") and may be viewed
on the Electronic Document Gathering and Retrieval System
("EDGAR") at www.sec.gov/edgar.shtml, on the System for
Electronic Document Analysis and Retrieval ("SEDAR") at
www.sedar.com, and on the Company's website at www.energyfuels.com.
Unless noted otherwise, all dollar amounts are in U.S. dollars.
Highlights:
- Working capital at December 31,
2020 was $40.2 million, a
$19.7 million increase over the
Company's $20.5 million working
capital balance at December 31, 2019.
The Company's December 31, 2020
working capital balance of $40.2
million included $22.4 million
of cash and marketable securities and $27.6
million of inventory, including approximately 690,700 pounds
of U.S. origin uranium produced at the Company's facilities and
1,672,000 pounds of high-purity vanadium in the form of immediately
marketable product.
- Due to our recent share price strength, the Company raised
gross proceeds of $30.4 million on
its at-the-market equity program between January 1, 2021 and March
18, 2021, at a weighted average price of $5.53 per share, further enhancing the Company's
financial position. With this strong working capital position, the
Company is well positioned to react very swiftly to market
opportunities as they arise, particularly with respect to any
ramp-up of uranium production needed in response to the proposed
strategic national U.S. Uranium Reserve (the "Uranium
Reserve"), and to fund capital requirements and other
expenditures needed for our developing rare earth element
("REE") business.
- On October 6, 2020, the Company
announced it was debt free, following the full retirement of all of
its floating rate convertible unsecured subordinated
debentures.
- For the year, uranium production totaled approximately 196,500
pounds of U3O8, and vanadium production
totaled approximately 67,000 pounds of
V2O5.
- On April 13, 2020, the Company
announced its entry into the REE business. By October 2020, the Company had produced on a
pilot-scale an intermediate REE product (mixed REE carbonate) from
natural REE- and uranium-bearing monazite sands at its White Mesa
Mill. Significant quantities of monazite are currently mined as a
byproduct of heavy mineral sand operations that primarily recover
zircon and titanium in the U.S. and elsewhere in the world. In
December 2020, the Company announced
that it was entering commercial production of mixed REE carbonate
in 2021 following the completion of an agreement on December 14, 2020 to purchase a minimum of 2,500
tons of monazite per year for three years from a facility located
in Georgia, USA owned by The
Chemours Company ("Chemours").
- On March 1, 2021, the Company and
Neo Performance Materials ("Neo") announced the launch of a
new U.S.-European REE production initiative. The initiative is
expected to produce value-added REE products from natural monazite
sands. Energy Fuels plans to process the monazite sands into a
mixed REE carbonate at its 100% owned White Mesa Mill in
Utah and sell this product as feed
material for Neo's value-added separated REE production plant in
Europe.
- On March 9, 2021, the Company
announced that the first shipments of natural monazite ore from
Chemours had arrived at the Company's White Mesa Mill. These first
shipments mark the beginning of operations for what we believe will
become a burgeoning supply chain. This is a key milestone for the
Company, as we work to create, refine, and grow a sustainable rare
earth supply chain capable of supplying growing demand for clean
technologies in the U.S. and Europe.
- Energy Fuels is also continuing to evaluate developing its own
REE separation and other value-added U.S. REE production
capabilities at the White Mesa Mill in the future.
- No material uranium sales were completed during the year, and
the Company is strategically maintaining its uranium inventory for
future sales in anticipation of higher uranium prices, potentially
as a result of the proposed creation of the Uranium Reserve or due
to generally improved uranium market conditions.
- The Company completed no material vanadium sales during the
year. At this time, the Company expects to maintain its
V2O5 inventory for sale in the future to
capitalize on potential future price increases in vanadium markets.
Vanadium prices are currently increasing, and as of March 12, 2021, the mid-point spot price of
V2O5 in Europe had increased roughly 60% since the end
of 2020.
- The Company had an operating loss of $24.6 million during 2020, compared to
$40.6 million during 2019.
- On December 21, 2020, the U.S.
Congress passed an omnibus appropriation bill that included
$75 million to create the proposed
Uranium Reserve. The President signed the bill into law on
December 27, 2020. This funding opens
the door for the U.S. government to purchase domestically produced
uranium to guard against potential commercial and national security
risks presented by the United
States' near total reliance on imported uranium.
- On September 14, 2020, the U.S.
Department of Commerce ("DOC") obtained Russia's agreement to extend limits on uranium
imports into the U.S. through 2040 under an extended Russian
Suspension Agreement ("RSA"). The DOC won important
concessions from Russia, including
lower quotas, allowing only a portion of the quotas to be used for
the sale of U3O8 and conversion, and strict
controls on returned feed under Russian enrichment service
contracts.
- On December 21, 2020, the Company
published its first Sustainability Report describing its ongoing
commitment to the environment, worker health, public safety and
social responsibility. The report highlights the Company's
increasing role in combatting climate change through producing and
recycling carbon-free energy resources. The Sustainability Report
is publicly available on the Company's website here.
Mark S. Chalmers, Energy
Fuels' President and CEO, stated:
"2020 was a transformative year for Energy Fuels, as we worked
on developing a rare earth business complementary to our core
uranium business. As a result, we believe we have clearly emerged
as the key U.S. hub for the raw materials that make many clean
energy and advanced technologies possible, including uranium, rare
earths and vanadium, all of which are considered 'critical
minerals' by the U.S. government.
"Starting with our core business, Energy Fuels continues to be
the leader in U.S. uranium, as we again led the U.S. in uranium
production for the 4th year in a row. Although we are
maintaining production at reduced levels for now, our three
production facilities in Utah,
Wyoming and Texas have a combined capacity to produce more
uranium than any other U.S. company. We can quickly deploy this
capacity toward improved uranium markets or U.S. government
purchases for the strategic national Uranium Reserve. We were
pleased to see the U.S. government recognize the strategic
importance of our industry when Congress appropriated $75 million for the creation of the proposed
Uranium Reserve. We believe our facilities are natural candidates
to receive a significant portion of this money, as they have long
track records of proven, low-cost production from our multiple
projects.
"Last year, it became clear that Energy Fuels might hold the key
to restoring sustainable, low-cost, domestic rare earth production
in the U.S., which has been a priority for the government and
private industry for many years. I'm not exaggerating when I say
that rare earths at Energy Fuels' White Mesa Mill in Utah might be the best resource opportunity
I've encountered in my 45-year mining career. One of the best
naturally occurring rare earth minerals, monazite, is currently
mined in the U.S. and elsewhere around the world as a byproduct of
other metal mining. However, it is all sold to China's rare earth industry, due to the
presence of uranium and other radionuclides. Recovering and
managing these radionuclides requires special licenses and
expertise, which we have at our White Mesa Mill. We produced an
intermediate rare earth carbonate product on a pilot scale at the
Mill in October 2020, which was the
first rare earth carbonate production from monazite in the U.S. in
over twenty years. In 2020, we also began working with Chemours and
Neo to jointly develop a fully integrated U.S.-European rare earth
supply chain using monazite mined in Georgia by Chemours, processed in Utah by Energy Fuels for the recovery of
uranium and an REE carbonate, with the REE carbonate then
manufactured by Neo into value-added rare earth products in
Europe. In December 2020, we entered into a 3-year supply
agreement with Chemours for monazite. And this month, we entered
into an agreement in principle, subject to completion of definitive
agreements, to sell our mixed rare earth carbonate to Neo, thereby
achieving our objective of creating this fully-integrated rare
earth supply chain. We expect to commence commercial production of
rare earth carbonate at the Mill in April, 2021. I'm proud to say
that we've accomplished all of this in less than one year, and if
we're successful in ramping up, we will be producing a rare earth
product at a more advanced stage than any other U.S. company, which
is receiving significant international attention. We look forward
to providing further updates on our progress on rare earths.
"Finally, we significantly strengthened our balance sheet in
2020, setting the stage for us to grow our uranium and rare earth
businesses. We had $40.2 million of
working capital at December 31, 2020,
and we paid off all of our debt in October. Our working capital
includes 690,700 pounds of uranium valued at $23.79 per pound and 1,672,000 pounds of vanadium
valued at $5.11 per pound on our
balance sheet. Currently, the uranium spot price sits at
$27.40 per pound, which is 15% higher
than our balance sheet carrying value, and the vanadium spot price
is $8.33 per pound, which is 63%
higher than our balance sheet carrying value. We are closely
tracking developments in the uranium and vanadium markets to
determine when to sell this material. However, today's markets are
having a material positive effect on our financial position,
putting us in an excellent position when we choose to monetize some
of these inventories.
"There is renewed interest in the uranium sector, our progress
on rare earths has exceeded our highest expectations, and vanadium
prices are rising. We are off to a fantastic start in 2021, and I
am excited to see what 2021 will bring for Energy Fuels and our
shareholders."
Webcast on Tuesday, March 23,
2021 at 4:00 pm ET
(2:00 pm MT):
Energy Fuels will be hosting a video webcast on Tuesday, March 23, 2021 at 4:00 pm ET (2:00 pm
MT) to discuss its 2020 financial results and other
corporate initiatives. To join the webcast, please click on the
link below to access the presentation and the viewer-controlled
webcast slides:
Energy Fuels' FY-2020 Results
If you would like to participate in the webcast and ask
questions, please dial (888) 664-6392 (toll free in the U.S. and
Canada).
A link to a recorded version of the proceedings will be
available on the Company's website shortly after the webcast by
calling (888) 390-0541 (toll free in the U.S. and Canada) and by entering the code 947332#. The
recording will be available until April 6,
2021.
Selected Summary Financial Information:
|
|
|
|
|
|
|
$000's, except per
share data
|
|
Year ended
December 31, 2020
|
|
Year ended
December 31, 2019
|
|
Year ended
December 31, 2018
|
Total
revenues
|
$
|
1,658
|
$
|
5,865
|
$
|
31,721
|
Gross profit
(loss)
|
|
1,658
|
|
1,918
|
|
16,969
|
Operating profit
(loss)
|
|
(24,627)
|
|
(40,581)
|
|
(21,312)
|
Net income (loss)
attributable to the company
|
|
(27,776)
|
|
(37,978)
|
|
(25,245)
|
Basic and diluted
loss per share
|
|
(0.23)
|
|
(0.40)
|
|
(0.30)
|
|
|
|
|
|
$000's
|
|
As at December
31,
2020
|
|
As at December
31,
2019
|
Financial
Position:
|
|
|
|
|
Working
capital
|
$
|
40,158
|
$
|
20,534
|
Property, plant and
equipment, net
|
|
23,621
|
|
26,203
|
Mineral properties,
net
|
|
83,539
|
|
83,539
|
Total
assets
|
|
183,236
|
|
175,720
|
Total long-term
liabilities
|
|
13,376
|
|
22,475
|
Outlook
Overview
In response to the proposed establishment of the Uranium
Reserve, the Company is evaluating activities aimed towards
increasing uranium production at all or some of its production
facilities, including the currently operating White Mesa Mill, as
well as the Nichols Ranch ISR Facility, the Alta Mesa ISR Facility,
La Sal Complex and Pinyon Plain Mine, which are currently on
standby.
During 2021, the Company expects to recover uranium at the White
Mesa Mill from alternate feed materials. The Company also expects
to recover uranium and produce mixed REE carbonate from natural
monazite ore during 2021, subject to successful ramp-up. The
vanadium pond-return campaign that was conducted in 2019 was
brought to a close in early 2020.
Subject to any actions the Company may take in response to the
proposed establishment of the U.S. Uranium Reserve, both ISR and
conventional uranium recovery is expected to be maintained at
reduced levels, as a result of current uranium market conditions,
until such time when market conditions improve sufficiently. Until
such time that improvement in uranium market conditions is observed
or suitable sales contracts can be entered into, the Company
expects to defer further wellfield development at its Nichols Ranch
Project. In addition, the Company expects to keep the Alta Mesa
Project and its conventional mining properties on standby.
The Company is also seeking new sources of revenue, including
its emerging REE business, as well as new sources of alternate feed
materials and new fee processing opportunities at the White Mesa
Mill that can be processed under existing market conditions (i.e.,
without reliance on current uranium sales prices). The Company will
also continue its support of U.S. governmental activities to
support the U.S. uranium mining industry, including the proposed
establishment of the Uranium Reserve. In addition, the Company is
in discussions to potentially sell certain of its non-material
properties, although there are currently no binding offers, and
there can be no assurance that a sale will be completed or that we
will be successful in completing a sale on acceptable terms.
Extraction and Recovery Activities Overview
During the year ended December 31, 2020, the Company
recovered 196,500 pounds of U3O8, all of
which were for the account of the Company. The Company also
recovered 67,000 pounds of V2O5, all of which
were for the account of the Company. The Company expects to recover
approximately 30,000 to 60,000 pounds of U3O8
in the year ending December 31, 2021
for its own account, and zero pounds of U3O8
for the account of others. In 2021, the Company also expects to
produce approximately 2,000 to 3,000 tons of mixed REE carbonate at
the White Mesa Mill, containing approximately 1,000 to 1,600 tons
of total rare earth oxides ("TREO"). The Company expects to
produce no vanadium in 2021.
The Company has strategically opted not to enter into any
uranium sales commitments for 2021. Therefore, subject to the
proposed establishment of the Uranium Reserve and general market
conditions, all 2021 uranium production is expected to be added to
existing inventories, which are expected to total approximately
720,000 to 750,000 pounds of U3O8 at
year-end. All V2O5 inventory is expected to
be sold on the spot market if prices rise significantly above
current levels, but otherwise maintained in inventory. The Company
expects to sell all or a portion of its mixed REE carbonate to
global separation facilities and/or to stockpile it for future
separation at the White Mesa Mill or elsewhere.
ISR Activities
We extracted and recovered approximately 6,000 pounds of
U3O8 from the Nichols Ranch ISR Project for
the year ended December 31, 2020. The Company expects to
produce insignificant quantities of U3O8 in
the year ending December 31, 2021
from Nichols Ranch.
As of December 31, 2020, the Nichols Ranch wellfields had
nine header houses that previously extracted uranium, and which are
now depleted. The Company currently holds 34 fully-permitted,
undeveloped wellfields at Nichols Ranch, including four additional
wellfields at the Nichols Ranch wellfields, 22 wellfields at the
adjacent Jane Dough wellfields, and eight wellfields at the Hank
Project, which is fully permitted to be constructed as a satellite
facility to the Nichols Ranch Plant.
The Company expects to continue to keep the Alta Mesa Project on
standby until such time as improvements in uranium market
conditions are observed, the proposed U.S. Uranium Reserve is
established, and/or suitable sales contracts can be procured.
Conventional Activities
Conventional Extraction and Recovery Activities
During the year ended December 31,
2020, the White Mesa Mill recovered 190,500 pounds of
U3O8 and 67,000 pounds of
V2O5. The Mill also focused on developing its
REE recovery business. During 2021, the Company expects to recover
approximately 30,000 to 60,000 pounds of U3O8
at the White Mesa Mill, including uranium recovered through the
processing of uranium- and REE-bearing natural monazite ore. The
Company also expects to produce approximately 2,000 to 3,000 tons
of mixed REE carbonate at the Mill, containing approximately 1,000
to 1,600 tons TREO. The Company currently has approximately 127,000
pounds of U3O8 contained in stockpiled
alternate feed material and ore inventory that can be recovered in
the future for the proposed Uranium Reserve or as general market
conditions warrant. In addition, there remains an estimated 1.5 to
3 million pounds of solubilized recoverable
V2O5 inventory remaining in the White Mesa
Mill's tailings facility awaiting future recovery, as market
conditions may warrant.
Conventional Standby, Permitting and Evaluation Activities
During the year ended December 31, 2020, standby and
environmental compliance activities occurred at the Pinyon Plain
Project. Subject to any actions the Company may take in response to
the proposed establishment of the Uranium Reserve and general
market conditions, during 2021, the Company plans to continue
carrying out engineering, metallurgical testing, procurement and
construction management activities at its Pinyon Plain Project.
The Company is selectively advancing certain permits at its
other major conventional uranium projects, such as the Roca Honda
Project, a large, high-grade conventional project in New Mexico. The Company will also maintain
required permits at the Company's conventional projects, including
the Sheep Mountain Project, La Sal Complex, and the Whirlwind
mines. In addition, the Company will continue to evaluate the
Bullfrog Property at its Henry Mountains Project. The Company is
also in discussions to potentially sell the Tony M, Daneros, Rim
and other non-core conventional assets.
Uranium Sales
During the year ended December 31, 2020, the Company
completed no sales of uranium. The Company currently has no
remaining contracts, and therefore all existing uranium inventory
and future production is fully unhedged to future uranium price
increases.
Vanadium Sales
During 2020, the Company completed no sales of vanadium. The
Company expects to sell finished vanadium product when justified
into the metallurgical industry, as well as other markets that
demand a higher purity product, including the aerospace, chemical,
and potentially the vanadium battery industries.
Rare Earth Sales
The Company expects to commence commercial production of a mixed
REE carbonate in 2021. Subject to successfully ramping-up
production of a salable product during 2021, the Company expects to
sell some or all of this intermediate REE product to REE separation
facilities outside the U.S. To the extent not sold, the Company
expects to stockpile mixed REE carbonate at the White Mesa Mill for
future separation and other downstream REE processing at the Mill
or elsewhere.
The Company also continues to pursue new sources of revenue,
including additional alternate feed materials and other sources of
feed for the White Mesa Mill.
About Energy Fuels: Energy Fuels is a
leading U.S.-based uranium mining company, supplying
U3O8 to major nuclear utilities. The Company
also produces vanadium from certain of its projects, as market
conditions warrant, and expects to commence commercial production
of REE carbonate in 2021. Its corporate offices are in Lakewood, Colorado near Denver, and all of its assets and
employees are in the United
States. Energy Fuels holds three of America's key uranium
production centers: the White Mesa Mill in Utah, the Nichols Ranch in-situ recovery
("ISR") Project in Wyoming, and
the Alta Mesa ISR Project in Texas. The White Mesa Mill is the only
conventional uranium mill operating in the U.S. today, has a
licensed capacity of over 8 million pounds of
U3O8 per year, and has the ability to produce
vanadium when market conditions warrant, as well as REE
carbonate from various uranium-bearing ores. The
Nichols Ranch ISR Project is currently on standby and has a
licensed capacity of 2 million pounds of U3O8
per year. The Alta Mesa ISR Project is also currently on standby.
In addition to the above production facilities, Energy Fuels also
has one of the largest NI 43-101 compliant uranium resource
portfolios in the U.S. and several uranium and uranium/vanadium
mining projects on standby and in various stages of permitting and
development. The primary trading market for Energy Fuels' common
shares is the NYSE American under the trading symbol "UUUU," and
the Company's common shares are also listed on the Toronto Stock
Exchange under the trading symbol "EFR." Energy Fuels' website is
www.energyfuels.com.
Cautionary Note Regarding Forward-Looking
Statements: This news release contains certain "Forward
Looking Information" and "Forward Looking Statements" within the
meaning of applicable United
States and Canadian securities legislation, which may
include, but are not limited to, statements with respect to:
production and sales forecasts; costs of production; scalability,
and the Company's ability and readiness to re-start, expand or
deploy any of its existing projects or capacity to respond to any
improvements in uranium market conditions or in response to the
proposed Uranium Reserve; any expectation regarding any remaining
dissolved vanadium in the White Mesa Mill's tailings facility
solutions; the ability of the Company to secure any new sources of
alternate feed materials or other processing opportunities at the
White Mesa Mill; expected timelines for the permitting and
development of projects; the Company's expectations as to longer
term fundamentals in the market and price projections; any
expectation that the Company will maintain its position as a
leading uranium company in the United
States; any expectation that the proposed Uranium Reserve
will be implemented and if implemented the manner in which it will
be implemented and the timing of implementation; any
expectation with respect to timelines to production; any
expectation that Energy Fuels is well-positioned to be
a significant supplier of the uranium needed for the proposed
Uranium Reserve; any expectation that the Company may be able to
sell its uranium and vanadium inventories at potentially higher
prices in the future; any expectation that the White Mesa
Mill will be successful in producing REE Carbonate on a commercial
basis; any expectation that Neo will be successful in separating
the White Mesa Mill's REE Carbonate on a commercial basis; any
expectation that Energy Fuels will be successful in developing U.S.
separation, or other value-added U.S. REE production capabilities
at the White Mesa Mill, or otherwise; any expectation that the
Company, Chemours and Neo will be successful in jointly
developing a fully integrated U.S.-European REE supply chain;
any expectation that the Company will be successful in fully
integrating the U.S REE supply chain in the future; any expectation
that, if the Company is successful in ramping up, it
will be producing an REE product at a more advanced stage than any
other U.S. company; any expectation that the Company has emerged as
the key U.S. hub for the raw materials that make many clean energy
and advanced technologies possible; any expectation with
respect to the future demand for REEs; any expectation with respect
to the quantities of monazite ore to be acquired by Energy Fuels,
the quantities of REE Carbonate to be produced by the White Mesa
Mill or the quantities of contained TREO in the Mill's REE
carbonate; any expectation that Neo and Energy Fuels will be
successful in completing definitive agreements and hence proceeding
with their agreement in principle; and any expectation that
the Company will successfully sell certain of its non-material
properties on acceptable terms or at all. Generally, these
forward-looking statements can be identified by the use of
forward-looking terminology such as "plans," "expects," "does not
expect," "is expected," "is likely," "budgets," "scheduled,"
"estimates," "forecasts," "intends," "anticipates," "does not
anticipate," or "believes," or variations of such words and
phrases, or state that certain actions, events or results "may,"
"could," "would," "might" or "will be taken," "occur," "be
achieved" or "have the potential to." All statements, other than
statements of historical fact, herein are considered to be
forward-looking statements. Forward-looking statements involve
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the
Company to be materially different from any future results,
performance or achievements express or implied by the
forward-looking statements. Factors that could cause actual results
to differ materially from those anticipated in these
forward-looking statements include risks associated with:
commodity prices and price fluctuations; processing and
mining difficulties, upsets and delays; permitting and licensing
requirements and delays; changes to regulatory requirements; legal
challenges; the availability of sources of alternate feed materials
and other feed sources for the White Mesa Mill; competition from
other producers; public opinion; government and political actions;
the appropriations for the proposed Uranium Reserve not being
allocated to that program and the Uranium Reserve not being
implemented; the manner in which the proposed Uranium Reserve, if
established, will be implemented; the Company not being successful
in selling any uranium into the proposed Uranium Reserve at
acceptable quantities or prices, or at all; available supplies of
monazite sands; the ability of the White Mesa Mill to produce REE
Carbonate to meet commercial specifications on a commercial scale
at acceptable costs; the ability of Neo to separate the REE
Carbonate produced by the White Mesa Mill to meet commercial
specifications on a commercial scale at acceptable costs; market
factors, including future demand for REEs; the ability of Neo and
Energy Fuels to finalize definitive agreements; and the
other factors described under the caption "Risk Factors" in the
Company's most recently filed Annual Report on Form 10-K, which is
available for review on EDGAR at www.sec.gov/edgar.shtml, on
SEDAR at www.sedar.com, and on the Company's website at
www.energyfuels.com. Forward-looking statements contained
herein are made as of the date of this news release, and the
Company disclaims, other than as required by law, any obligation to
update any forward-looking statements whether as a result of new
information, results, future events, circumstances, or if
management's estimates or opinions should change, or otherwise.
There can be no assurance that forward-looking statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, the reader is cautioned not to place undue reliance on
forward-looking statements. The Company assumes no obligation to
update the information in this communication, except as otherwise
required by law.
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SOURCE Energy Fuels Inc.