"This quarter we posted positive income results and repaid the outstanding balance on our remaining 8.0% notes," said
Financial Results
Centrus generated total revenue of
Revenue from the LEU segment increased
Cost of sales for the LEU segment increased
Revenue from the contract services segment increased
Cost of sales for the contract services segment increased
Centrus realized a gross profit of
2019 Outlook
Centrus reiterates its annual guidance for 2019, including SWU and uranium revenue in the range of
Based on cost estimates that are currently under review for the three-year HALEU program, Centrus expects to recognize a contract loss in the fourth quarter of 2019 in the approximate range of
Our financial guidance is subject to a number of assumptions and uncertainties that could affect results either positively or negatively. Variations from our expectations could cause differences between our guidance and our ultimate results. Among the factors that could affect our results are:
- Additional purchases or sales of SWU and uranium;
- Conditions in the LEU and energy markets, including pricing, demand, operations, and regulations;
- Timing of customer orders, related deliveries, and purchases of LEU or components;
- Contracts for any additional scope of work with UT-Battelle;
- Financial market conditions and other factors that may affect pension and benefit liabilities and the value of related assets;
- The outcome of legal proceedings and other contingencies;
- Potential use of cash for strategic or financial initiatives;
- Actions taken by customers, including actions that might affect existing contracts; and,
- Market, international trade and other conditions impacting Centrus' customers and the industry.
About
Centrus is a trusted supplier of nuclear fuel and services for the nuclear power industry. Centrus provides value to its utility customers through the reliability and diversity of its supply sources – helping them meet the growing need for clean, affordable, carbon-free electricity. Since 1998, the Company has provided its utility customers with more than 1,750 reactor years of fuel, which is equivalent to 7 billion tons of coal.
With world-class technical capabilities, Centrus offers turnkey engineering and advanced manufacturing solutions to its customers. The Company is also advancing the next generation of centrifuge technologies so that America can restore its domestic uranium enrichment capability in the future. Find out more at www.centrusenergy.com.
Forward-Looking Statements
This news release contains "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934 - that is, statements related to future events. In this context, forward-looking statements may address our expected future business and financial performance, and often contain words such as "expects", "anticipates", "intends", "plans", "believes", "will", "should", "could", "would" or "may" and other words of similar meaning. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For Centrus Energy Corp., particular risks and uncertainties that could cause our actual future results to differ materially from those expressed in our forward-looking statements include: risks related to our significant long-term liabilities, including material unfunded defined benefit pension plan obligations and postretirement health and life benefit obligations; risks relating to our 8.25% notes (the "8.25% Notes") maturing in
These factors may not constitute all factors that could cause actual results to differ from those discussed in any forward-looking statement. Accordingly, forward-looking statements should be not be relied upon as a predictor of actual results. Readers are urged to carefully review and consider the various disclosures made in this report and in our other filings with the
Contact
Investors:
Media:
CENTRUS ENERGY CORP |
|||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
(Unaudited; in millions, except share and per share data) |
|||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||
2019 |
2018 |
2019 |
2018 |
||||||||||||
Revenue: |
|||||||||||||||
Separative work units |
$ |
75.0 |
$ |
17.6 |
$ |
87.4 |
$ |
68.2 |
|||||||
Uranium |
12.8 |
11.3 |
38.1 |
14.9 |
|||||||||||
Contract services |
16.9 |
5.2 |
28.5 |
26.1 |
|||||||||||
Total revenue |
104.7 |
34.1 |
154.0 |
109.2 |
|||||||||||
Cost of Sales: |
|||||||||||||||
Separative work units and uranium |
54.4 |
20.9 |
100.4 |
98.6 |
|||||||||||
Contract services |
14.8 |
5.4 |
27.9 |
18.8 |
|||||||||||
Total cost of sales |
69.2 |
26.3 |
128.3 |
117.4 |
|||||||||||
Gross profit (loss) |
35.5 |
7.8 |
25.7 |
(8.2) |
|||||||||||
Advanced technology costs |
1.3 |
5.8 |
13.0 |
19.2 |
|||||||||||
Selling, general and administrative |
8.7 |
8.8 |
24.5 |
29.7 |
|||||||||||
Amortization of intangible assets |
1.8 |
1.7 |
4.1 |
4.5 |
|||||||||||
Special charges (credits) for workforce reductions and advisory costs |
0.8 |
0.6 |
(2.2) |
1.5 |
|||||||||||
Gain on sales of assets |
(0.2) |
— |
(0.7) |
(0.3) |
|||||||||||
Operating income (loss) |
23.1 |
(9.1) |
(13.0) |
(62.8) |
|||||||||||
Nonoperating components of net periodic benefit expense (income) |
(0.1) |
(1.6) |
(0.2) |
(4.9) |
|||||||||||
Interest expense |
0.9 |
1.0 |
2.9 |
3.0 |
|||||||||||
Investment income |
(0.5) |
(0.7) |
(1.9) |
(1.9) |
|||||||||||
Income (loss) before income taxes |
22.8 |
(7.8) |
(13.8) |
(59.0) |
|||||||||||
Income tax benefit |
— |
— |
(0.1) |
(0.1) |
|||||||||||
Net income (loss) and comprehensive income (loss) |
22.8 |
(7.8) |
(13.7) |
(58.9) |
|||||||||||
Preferred stock dividends - undeclared and cumulative |
1.9 |
1.9 |
5.9 |
5.9 |
|||||||||||
Net income (loss) allocable to common stockholders |
$ |
20.9 |
$ |
(9.7) |
$ |
(19.6) |
$ |
(64.8) |
|||||||
Net income (loss) per common share: |
|||||||||||||||
Basic |
$ |
2.18 |
$ |
(1.06) |
$ |
(2.05) |
$ |
(7.11) |
|||||||
Diluted |
$ |
2.17 |
$ |
(1.06) |
$ |
(2.05) |
$ |
(7.11) |
|||||||
Average number of common shares outstanding (in thousands): |
|||||||||||||||
Basic |
9,582 |
9,133 |
9,560 |
9,118 |
|||||||||||
Diluted |
9,626 |
9,133 |
9,560 |
9,118 |
CENTRUS ENERGY CORP |
|||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
(Unaudited; in millions, except share and per share data) |
|||||||
September 30, |
December 31, |
||||||
ASSETS |
|||||||
Current assets: |
|||||||
Cash and cash equivalents |
$ |
77.2 |
$ |
123.1 |
|||
Accounts receivable |
19.1 |
60.2 |
|||||
Inventories |
105.2 |
129.7 |
|||||
Deferred costs associated with deferred revenue |
136.1 |
134.9 |
|||||
Deposits for financial assurance |
17.2 |
30.3 |
|||||
Other current assets |
8.3 |
6.3 |
|||||
Total current assets |
363.1 |
484.5 |
|||||
Property, plant and equipment, net of accumulated depreciation of $2.1 as of September 30, 2019 |
3.8 |
4.2 |
|||||
Deposits for financial assurance |
5.7 |
6.3 |
|||||
Intangible assets, net |
71.9 |
76.0 |
|||||
Other long-term assets |
6.7 |
0.7 |
|||||
Total assets |
$ |
451.2 |
$ |
571.7 |
|||
LIABILITIES AND STOCKHOLDERS' DEFICIT |
|||||||
Current liabilities: |
|||||||
Accounts payable and accrued liabilities |
$ |
42.0 |
$ |
52.4 |
|||
Payables under SWU purchase agreements |
13.0 |
46.0 |
|||||
Inventories owed to customers and suppliers |
36.9 |
103.0 |
|||||
Deferred revenue and advances from customers |
233.1 |
204.5 |
|||||
Current debt |
6.1 |
32.8 |
|||||
Total current liabilities |
331.1 |
438.7 |
|||||
Long-term debt |
114.1 |
120.2 |
|||||
Postretirement health and life benefit obligations |
130.3 |
136.2 |
|||||
Pension benefit liabilities |
159.0 |
168.9 |
|||||
Advances from customers |
29.4 |
15.0 |
|||||
Other long-term liabilities |
22.7 |
14.6 |
|||||
Total liabilities |
786.6 |
893.6 |
|||||
Stockholders' deficit: |
|||||||
Preferred stock, par value $1.00 per share, 20,000,000 shares authorized |
|||||||
Series A Participating Cumulative Preferred Stock, none issued |
— |
— |
|||||
Series B Senior Preferred Stock, 7.5% cumulative, 104,574 shares issued and outstanding and |
4.6 |
4.6 |
|||||
Class A Common Stock, par value $0.10 per share, 70,000,000 shares authorized, 8,051,307 and |
0.8 |
0.8 |
|||||
Class B Common Stock, par value $0.10 per share, 30,000,000 shares authorized, 1,406,082 |
0.1 |
0.1 |
|||||
Excess of capital over par value |
61.4 |
61.2 |
|||||
Accumulated deficit |
(402.2) |
(388.5) |
|||||
Accumulated other comprehensive income, net of tax |
(0.1) |
(0.1) |
|||||
Total stockholders' deficit |
(335.4) |
(321.9) |
|||||
Total liabilities and stockholders' deficit |
$ |
451.2 |
$ |
571.7 |
CENTRUS ENERGY CORP |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(Unaudited; in millions) |
|||||||
Nine Months Ended |
|||||||
2019 |
2018 |
||||||
Operating Activities |
|||||||
Net loss |
$ |
(13.7) |
$ |
(58.9) |
|||
Adjustments to reconcile net loss to cash used in operating activities: |
|||||||
Depreciation and amortization |
4.5 |
5.1 |
|||||
PIK interest on paid-in-kind toggle notes |
1.1 |
1.2 |
|||||
Gain on sales of assets |
(0.7) |
(0.3) |
|||||
Inventory valuation adjustments |
2.3 |
— |
|||||
Changes in operating assets and liabilities: |
|||||||
Accounts receivable |
31.3 |
57.6 |
|||||
Inventories, net |
(9.3) |
30.6 |
|||||
Payables under SWU purchase agreements |
(33.0) |
(64.8) |
|||||
Deferred revenue and advances from customers, net of deferred costs |
18.9 |
(16.7) |
|||||
Accounts payable and other liabilities |
(11.2) |
(10.3) |
|||||
Pension and postretirement liabilities |
(15.9) |
(21.4) |
|||||
Other, net |
(0.8) |
0.2 |
|||||
Cash used in operating activities |
(26.5) |
(77.7) |
|||||
Investing Activities |
|||||||
Capital expenditures |
— |
(0.1) |
|||||
Proceeds from sales of assets |
0.7 |
0.4 |
|||||
Cash provided by investing activities |
0.7 |
0.3 |
|||||
Financing Activities |
|||||||
Principal payments on debt |
(27.5) |
— |
|||||
Payments for deferred financing costs |
(0.2) |
— |
|||||
Payment of interest classified as debt |
(6.1) |
(6.1) |
|||||
Cash used in financing activities |
(33.8) |
(6.1) |
|||||
Decrease in cash, cash equivalents and restricted cash |
(59.6) |
(83.5) |
|||||
Cash, cash equivalents and restricted cash, beginning of period |
159.7 |
244.8 |
|||||
Cash, cash equivalents and restricted cash, end of period |
$ |
100.1 |
$ |
161.3 |
|||
Supplemental cash flow information: |
|||||||
Interest paid in cash |
$ |
1.5 |
$ |
0.8 |
|||
Non-cash activities: |
|||||||
Conversion of interest payable-in-kind to debt |
$ |
0.7 |
$ |
1.7 |
|||
Deferred financing costs included in accounts payable and accrued liabilities |
$ |
0.4 |
$ |
— |
|||
Right to use lease assets acquired under operating lease |
$ |
2.9 |
$ |
— |
|||
Disposal of right to use lease assets for early termination |
$ |
0.2 |
$ |
— |
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