-
Net loss of $158.9 million due primarily to non-production costs
related to Paducah GDP transition
-
Positive cash flow from operations supports year-end cash
balance of $314 million
-
USEC continues to pursue restructuring through a pre-arranged
Chapter 11 filing
-
Funding for American Centrifuge RD&D Program in place through
April 15, 2014; discussions on further government funding for American
Centrifuge technology continue
BETHESDA, Md.--(BUSINESS WIRE)--Mar. 31, 2014--
USEC Inc. (NYSE:USU) today reported a net loss of $158.9 million or
$32.43 per share for the year ended December 31, 2013. This compares to
a net loss of $1.2 billion or $245.02 per share for the year ended
December 31, 2012, which reflected the impact of $1.1 billion expense of
previously capitalized costs associated with the American Centrifuge
project in 2012. For the fourth quarter of 2013, USEC reported a net
loss of $71.7 million compared to a net loss of $1,084.3 million in the
fourth quarter of 2012.
Revenue for 2013 declined by $554.6 million to $1.31 billion or 30
percent compared to 2012 as deliveries of separative work units (SWU)
declined following the cessation of enrichment at the Paducah Gaseous
Diffusion Plant (GDP) in May 2013. Although production costs in the
first half of 2013 declined 5 percent compared to the corresponding
period of 2012, non-production expenses related to the cessation of
enrichment and transition of leased facilities back to the Department of
Energy (DOE) totaled $194.2 million for the full year in 2013. Purchase
costs for SWU from Russia increased $43 million, primarily due to a 6
percent per SWU year over year increase under the contract with Russia
(Russian Contract) under the 20-year Megatons to Megawatts program that
ended in 2013. Together, these factors resulted in a gross loss for the
year of $94.9 million. The consolidated financial statements include the
accounts of USEC Inc., its principal subsidiary United States Enrichment
Corporation, and its other subsidiaries.
“With the cessation of enrichment at the Paducah GDP, we have entered a
transition period where the non-production costs of preparing this vast
facility for turnover to the Department of Energy are affecting our
gross profit,” said John K. Welch, USEC president and CEO. “These costs
and related employee severance costs will continue to reduce our
profitability in 2014 until the facilities are returned to DOE.
“Despite the net loss for 2013, the results were an improvement over
2012. We had positive cash flow from operations and ended the year with
a cash balance of $314.2 million,” Welch said.
“We filed a pre-arranged Chapter 11 bankruptcy petition in March, and we
are working with various stakeholders to emerge from the court process
this summer. We undertook this restructuring to strengthen USEC’s
balance sheet, enhance our ability to sponsor the American Centrifuge
technology and improve our long-term business opportunities. During this
process we expect our operations to continue unaffected by the
bankruptcy.”
Revenue
Revenue for the fourth quarter was $398.5 million, a decrease of 1
percent compared to the same quarter of 2012. Revenue from the sale of
SWU for the quarter was $369.5 million compared to $377.2 million in the
same period of the prior year. Revenue from the sale of uranium was
$25.9 million, an increase of $3.5 million from the same quarter last
year.
For the full year, revenue was $1.31 billion, a decrease of $554.6
million or 30 percent from 2012. SWU volume declined 35 percent year
over year reflecting the expected decline in SWU deliveries following
the cessation of enrichment at the Paducah GDP at the end of May 2013
and the variability in timing of utility customer orders. The average
SWU price billed to customers increased 3 percent compared to 2012,
reflecting the particular contracts under which SWU were sold during the
periods. Uranium revenue was $71.2 million, an increase of $45.2 million
compared to 2012. The increase in uranium revenue reflects sales of
uranium generated from underfeeding the enrichment process prior to
ceasing enrichment at the Paducah GDP. Uranium sales have declined
significantly in recent years since most of our inventories of uranium
available for sale have been sold in prior years.
In a number of sales transactions, the Company transfers title and
collects cash from customers but does not recognize the revenue until
low enriched uranium is physically delivered. At December 31, 2013,
deferred revenue totaled $195.9 million, compared to $123.1 million at
December 31, 2012. The gross profit associated with deferred revenue as
of December 31, 2013, was $30.4 million.
Cost of Sales, Gross Profit Margin, Expenses and Other Income
Cost of sales for 2013 for SWU and uranium was $1.19 billion, excluding
non-production expenses, a decrease of $505.1 million compared to 2012.
The 30 percent change is primarily a result of the decline in SWU sales
volume, partially offset by higher uranium sales volume. Cost of sales
per SWU, excluding non-production expenses and revisions in 2012 to
prior accrued amounts, was 1 percent higher in 2013 compared to 2012.
Unit production costs declined 5 percent in the first half of 2013 prior
to enrichment cessation compared to the same period in 2012. Cost of
sales for SWU and uranium reflects monthly moving average inventory
costs based on production and purchase costs.
As we continue to take steps to prepare the Paducah GDP for return to
DOE following cessation of enrichment, we incurred $194.2 million of
non-production expenses in 2013 compared to $18.8 million in 2012. These
expenses, which have been charged directly to cost of sales, include
immediate asset retirement charges for property formerly used in the
enrichment process at the Paducah GDP, inventory valuation adjustments,
site expenses including lease turnover activities, power contract
losses, and accelerated depreciation.
Purchase costs for the SWU component of low enriched uranium (LEU) from
Russia increased $43.0 million in 2013 compared to 2012 primarily due to
a 6 percent increase in the purchase cost per SWU under the Russian
Contract. Purchase prices paid under the Russian Contract are set by a
pricing formula that includes market-based price points.
Higher non-production expenses and lower SWU sales volume directly led
to a negative gross profit for 2013. This gross loss was $94.9 million
in 2013 compared to a gross profit of $129.4 million in the previous
year. The gross profit margin for the year was negative 7.3 percent
compared to 6.9 percent in 2012.
Advanced technology costs declined $1,127.1 million in 2013 compared to
2012, reflecting the expense of $1.1 billion of previously capitalized
costs related to the American Centrifuge project in 2012, partially
offset with an increase in development activity in 2013 in connection
with the cooperative cost-sharing research, development and
demonstration program (such program, including any extension or
successor program, the “RD&D Program”) with DOE. In 2012, advanced
technology costs included the expense of previously capitalized costs
related to property, plant and equipment (including construction work in
progress) of $1,075.6 million, prepayments made to suppliers of $9.9
million and deferred financing costs related to the DOE loan guarantee
program of $6.7 million that were previously capitalized during the
period 2007 through 2011. Additionally, an expense of $44.6 million was
incurred in the second quarter of 2012 related to the title transfer of
previously capitalized American Centrifuge machinery and equipment to
DOE as provided in the cooperative agreement with DOE for the RD&D
Program.
DOE and USEC provide cost-sharing support for continued American
Centrifuge activities under our June 2012 cooperative agreement, as
amended. DOE reimburses USEC for 80 percent of qualifying American
Centrifuge expenditures, which is recognized as other income, totaling
$154.3 million in 2013 compared to $92.1 million in 2012. Currently the
RD&D Program is funded through April 15, 2014.
Selling, general and administrative expenses in 2013 were $46.8 million,
a decrease of $3.5 million or 7 percent compared to 2012. The lower
expense reflects a $4.7 million decline in salary and other compensation
costs resulting from a reduction in stock-based compensation costs and
reduced staffing levels, partially offset by an increase of $1.9 million
in consulting costs.
Special Charges for Workforce Reductions and Advisory Costs
The cessation of enrichment at the Paducah GDP has resulted in charges
of $24.0 million in 2013 for termination benefits consisting primarily
of severance payments. USEC initiated an initial workforce reduction of
140 employees that was substantially completed in August 2013. On
September 30, 2013, USEC's senior management authorized an additional
workforce reduction of approximately 90 Paducah employees. This
workforce reduction occurred between October 2013 and January 2014.
Between June and December 2013, the Paducah GDP workforce has been
reduced by 202 employees through layoffs. Severance payments of $3.2
million were charged to expense in 2013 for these workforce reductions,
which is net of $1.2 million of severance paid by USEC and invoiced to
DOE. Layoffs of the remaining Paducah workforce are expected to occur in
stages through 2014, but no later than the lease termination date of
August 1, 2015. We believe it is now probable that severance costs for
the remaining Paducah GDP workforce will be incurred. We estimate that
cost to be $20.8 million in the event of a full termination of
activities at the site without a transfer of employees to another
employer, with DOE owing a portion of this amount estimated to be up to
$5 million. DOE’s liability for its share of severance paid is pursuant
to the USEC Privatization Act.
In early 2012, we initiated an internal review of our organizational
structure and engaged a management consulting firm to support this
review. Since late 2012, we also have been engaged with advisors on the
restructuring of our balance sheet. During the fourth quarter of 2013,
we engaged additional advisory support to assist with the restructuring
of our balance sheet in 2014. Costs for these advisors totaled $11.0
million in 2013 compared to $8.4 million in 2012.
Cash Flow
At December 31, 2013, USEC had a cash balance of $314.2 million compared
to $292.9 million at December 31, 2012. Cash flow from operations in
2013 was $81.2 million compared to cash flow from operations of $142.9
million in the previous year. Positive cash flow resulted from a $160.1
million reduction in inventories due to monetization of inventory
produced in prior years. There were no capital expenditures in 2013
compared to $4.3 million during 2012. Beginning with the fourth quarter
of 2011, all American Centrifuge project costs incurred have been
expensed. Cash proceeds on the sale of our former subsidiary NAC of
$43.2 million were received in 2013.
2014 Outlook
USEC will be going through a period of transition during 2014 as we take
steps to strengthen our financial structure by addressing balance sheet
issues through a Chapter 11 filing with the U.S. Bankruptcy Court so
that we can emerge as a stronger sponsor of the American Centrifuge
project, complete the American Centrifuge RD&D Program, work with DOE on
its options for maintaining a domestic enrichment capability and the
scope of and our role in any such program and during any transition,
re-evaluate our plan and alternatives for proceeding with the financing
and commercialization of the American Centrifuge project, prepare for
the transition of the Paducah site, and appropriately reduce the size of
our corporate organization. Given the uncertainties of these transitions
and the uncertain and incremental nature of federal funding for the RD&D
Program or any successor program, our guidance for USEC financial
results and metrics for 2014 will be limited.
Our ability to continue as a going concern is contingent upon the
Bankruptcy Court’s approval of our reorganization plan and our ability
to successfully implement the reorganization plan, among other factors.
As a result of the Bankruptcy Filing, the realization of assets and the
satisfaction of liabilities are subject to uncertainty. While operating
as debtors-in-possession under Chapter 11, USEC Inc. may sell or
otherwise dispose of or liquidate assets or settle liabilities, subject
to the approval of the Bankruptcy Court or as otherwise permitted in the
ordinary course of business (and subject to restrictions contained in
the Debtor-In-Possession Credit Facility provided by United States
Enrichment Corporation, USEC Inc.’s subsidiary) for amounts other than
those reflected in the accompanying consolidated financial statements.
Further, our reorganization could materially change the amounts and
classifications of assets and liabilities reported in the consolidated
financial statements.
Our backlog includes approximately $200 million of deferred revenue,
whereby customers have made advance payments to be applied against
future deliveries, and approximately two-thirds of that is expected to
be delivered and recognized as revenue in 2014. In total, approximately
$400 million of the backlog as of December 31, 2013, is expected to be
delivered and recognized as revenue in 2014. Due to the current
supply/demand imbalance in the nuclear fuel market, and the transition
in sources of enrichment from production at the Paducah GDP, we did not
add significant new sales to offset reductions in backlog resulting from
deliveries in 2013. Our opportunities to make new sales are also
moderated by the uncertainty about the future prospects for commercial
production at the American Centrifuge Plant (“ACP”). During the
anticipated period of transition to the ACP, we expect a lower level of
revenues and sales, aligned with our anticipated sources of LEU from
existing inventory and purchases of Russian LEU.
After meeting its significant payables in the first quarter, the Company
anticipates a cash balance of at least $60 million at March 31, 2014.
Liquidity Risks and Uncertainties
Although we ended 2013 with a consolidated cash balance of $314.2
million, our prospects for adequate liquidity in 2014 are uncertain. Our
liquidity is dependent on a number of factors, including (i) our
operating needs, including the cost of our restructuring; (ii) the level
of expenditures for the American Centrifuge project beyond the current
RD&D program, which is funded through April 15, 2014, and the potential
demobilization or termination costs if funding for the project beyond
April 15 is not available or if we determine there is no longer a viable
path to commercialization of the American Centrifuge project; (iii) the
amount and timing of transition expenses for the Paducah GDP and our
ability to reach an acceptable agreement with DOE for the transition;
and (iv) our ability to obtain confirmation and effectiveness of our
proposed Plan of Reorganization to restructure our $530.0 million of
convertible senior notes that mature on October 1, 2014, all of which
impact our liquidity.
On March 5, 2014, USEC Inc. filed a voluntary petition for relief under
Chapter 11 of the United States Bankruptcy Code in the United States
Bankruptcy Court for the District of Delaware. The bankruptcy filing was
a “pre-arranged” filing which included the filing of a proposed
reorganization plan which is supported by certain holders of the claims
and interests impaired under the plan. USEC Inc.'s subsidiaries were not
part of the bankruptcy filing. USEC Inc. will continue to operate its
business as “debtor-in-possession” under the jurisdiction of the
Bankruptcy Court and in accordance with the applicable provisions of the
Bankruptcy Code and the orders of the Bankruptcy Court.
The bankruptcy filing is intended to strengthen our balance sheet,
enhance our ability to sponsor the American Centrifuge project and
improve our long-term business opportunities. We have reached an
agreement on the terms of a financial restructuring plan with the
holders of approximately 65 percent of the principal amount of our
convertible senior notes. Under the terms of the agreement, USEC Inc.
will replace the $530 million of convertible senior notes that are
scheduled to mature in October 2014 with new debt and equity. We have
also reached an agreement with Babcock & Wilcox Investment Company (B&W)
and Toshiba America Nuclear Energy Corporation (Toshiba) to restructure
their convertible preferred stock. As strategic investors, Toshiba and
B&W remain supportive of deployment of the ACP.
We believe that a restructuring of the convertible senior notes and
convertible preferred stock could improve the likelihood of success in
the deployment of the American Centrifuge project. A restructuring
according to our proposed reorganization plan would adversely affect the
holders of our common stock through dilution or loss in value. However,
we have no assurance regarding the outcome of Chapter 11 filing or that
a restructuring of our balance sheet will lead to our obtaining
financing for the ACP.
The economics of the American Centrifuge project are severely challenged
by the current supply/demand imbalance in the market for low enriched
uranium and related downward pressure on market prices for SWU, which
are now at their lowest levels in more than a decade. At current market
prices we do not believe that our plans for commercialization of the
American Centrifuge project are economically viable without additional
government support. Our cooperative agreement with DOE provides for 80
percent DOE and 20 percent USEC cost sharing for the RD&D Program.
Funding for the RD&D Program has only been provided through April 15,
2014, and DOE has stated that it does not plan to extend the RD&D
cooperative agreement beyond such date. We continue to discuss with DOE
its options for maintaining a domestic enrichment capability and DOE’s
plans for the American Centrifuge project post-April 15, as well as our
potential role in such options and during any transition. However, the
scope of and our role in a program after April 15 are uncertain, and we
have no assurance that the U.S. government will continue to support the
project beyond April 15, 2014. In light of our limited cash generation,
our ability to provide funding in 2014 will be limited. We continue to
evaluate our options concerning the American Centrifuge project,
including our role in any government-supported continuation of the
project beyond completion of the RD&D Program, further demobilization of
or delays in the commercial deployment of the project, and termination
of the project. Any such actions may have a material adverse impact on
our ability to deploy the American Centrifuge technology, on our
liquidity, on the long-term viability of our LEU business, and could
delay or impact our ability to obtain confirmation of our financial
restructuring plan and our emergence from bankruptcy.
We could make a decision to demobilize or terminate the project in the
near term, which would result in severance costs, contractual
commitments, contractual termination penalties and other related costs
which would impose additional demands on our liquidity. In addition,
actions that may be taken by vendors, customers, creditors and other
third parties in response to our actions or based on their view of our
financial strength and future business prospects, could give rise to
events that individually, or in the aggregate, impose significant
demands on our liquidity.
Additional Information
USEC expects to file its annual report on Form 10-K with the Securities
and Exchange Commission today. This report will be available in the
Investor Relations section of the USEC website, www.usec.com
. During the period its case is pending in Bankruptcy Court, USEC will
not hold quarterly telephonic conference calls with investors.
USEC has informed and discussed the Chapter 11 filing with the New York
Stock Exchange. The Company’s most recent quarterly update on its plan
of compliance to meet the Exchange’s continued listing standards was
accepted and the stock has traded since the Company’s December 16
announcement that it had reached a restructuring agreement. The NYSE
will continue to monitor the Company under its continued listing
standards throughout the Chapter 11 process.
USEC Inc., a global energy company, is a leading supplier of enriched
uranium fuel for commercial nuclear power plants.
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” and other words of similar
meaning. Forward-looking statements by their nature address matters that
are, to different degrees, uncertain. For USEC, particular risks and
uncertainties that could cause our actual future results to differ
materially from those expressed in our forward-looking statements
include, but are not limited to the impact of and risks related to USEC
Inc.’s “pre-arranged” case under Chapter 11 of the bankruptcy code
including risks related to obtaining approval and confirmation of USEC
Inc.’s plan of reorganization, the impact of any delay or inability in
obtaining such confirmation, the impact of a potential de-listing of our
common stock on the NYSE, the impact of our restructuring on the holders
of our common stock, preferred stock and convertible notes; risks
related to the ongoing transition of our business, including the impact
of our ceasing enrichment at the Paducah gaseous diffusion plant and
uncertainty regarding our ability to deploy the American Centrifuge
project; uncertainty regarding funding for the American Centrifuge
project after April 15, 2014, the date for completion of the current
period of funding for the research, development and demonstration
program (such program, including any extension or successor program, the
RD&D Program) and the potential for a demobilization or termination of
the American Centrifuge project if additional government funding is not
in place at the end of the current funding for the RD&D Program; risks
related to the underfunding of our defined benefit pension plans and
potential actions the Pension Benefit Guarantee Corporation could pursue
in connection with ceasing enrichment at the gaseous diffusion plants or
with any demobilization or termination of the American Centrifuge
project; the impact of uncertainty regarding our ability to continue as
a going concern on our liquidity and prospects; our ability to reach an
agreement with the DOE regarding the transition of the Paducah gaseous
diffusion plant and uncertainties regarding the transition costs and
other impacts of USEC ceasing enrichment at the Paducah gaseous
diffusion plant and returning the plant to DOE; the continued impact of
the March 2011 earthquake and tsunami in Japan on the nuclear industry
and on our business, results of operations and prospects; the impact and
potential extended duration of the current supply/demand imbalance in
the market for low enriched uranium (LEU); the impact of enrichment
market conditions, increased project costs and other factors on the
economic viability of the American Centrifuge project without additional
government support and on our ability to finance the project and the
potential for a demobilization or termination of the project;
uncertainty concerning the ultimate success of our efforts to obtain a
loan guarantee from DOE and/or other financing for the American
Centrifuge project or additional government support for the project and
the timing and terms thereof; the dependency of government funding or
other government support for the American Centrifuge project on
Congressional appropriations or on actions by DOE or Congress;
limitations on our ability to provide any required cost sharing under
the RD&D Program; uncertainty concerning our ability through the RD&D
Program to demonstrate the technical and financial readiness of the
centrifuge technology for commercialization; potential changes in our
anticipated ownership of or role in the American Centrifuge project,
including as a result of the need to raise additional capital to finance
the project; the impact of actions we have taken or may take to reduce
spending on the American Centrifuge project, including the potential
loss of key suppliers and employees, and impacts to cost and schedule;
the potential for DOE to seek to terminate or exercise its remedies
under the RD&D cooperative agreement or 2002 DOE-USEC agreement; changes
in U.S. government priorities and the availability of government funding
or support, including loan guarantees; risks related to our ability to
manage our liquidity without a credit facility; our dependence on
deliveries of LEU from Russia under a commercial supply agreement (the
Russian Supply Agreement) with a Russian government entity known as
Techsnabexport (TENEX) and limitations on our ability to import the
Russian LEU we buy under the Russian Supply Agreement into the United
States and other countries; risks related to actions that may be taken
by the U.S. Government, the Russian Government or other governments that
could affect our ability or the ability of TENEX to perform the Russian
Supply Agreement, including the imposition of sanctions, restrictions or
other requirements; risks related to our ability to sell the LEU we
procure under our fixed purchase obligations under the Russian Supply
Agreement; the decrease or elimination of duties charged on imports of
foreign-produced LEU; pricing trends and demand in the uranium and
enrichment markets and their impact on our profitability; movement and
timing of customer orders; changes to, or termination of, our agreements
with the U.S. government; risks related to delays in payment for our
contract services work performed for DOE, including our ability to
resolve certified claims for payment filed by USEC under the Contracts
Dispute Act; the impact of government regulation by DOE and the U.S.
Nuclear Regulatory Commission; the outcome of legal proceedings and
other contingencies (including lawsuits and government investigations or
audits); the competitive environment for our products and services;
changes in the nuclear energy industry; the impact of volatile financial
market conditions on our business, liquidity, prospects, pension assets
and credit and insurance facilities; the timing of recognition of
previously deferred revenue; and other risks and uncertainties discussed
in our filings with the Securities and Exchange Commission, including
our Annual Report on Form 10-K for the year ended December 31, 2013,
which is available at www.usec.com.
Revenue and operating results can fluctuate significantly from quarter
to quarter, and in some cases, year to year. We do not undertake to
update our forward-looking statements except as required by law.
|
|
|
USEC Inc.
|
|
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
|
|
(millions, except per share data)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
December 31,
|
|
Years Ended
December 31,
|
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
Separative work units
|
|
$
|
369.5
|
|
|
$
|
377.2
|
|
|
$
|
1,222.9
|
|
|
$
|
1,821.8
|
|
|
Uranium
|
|
|
25.9
|
|
|
|
22.4
|
|
|
|
71.2
|
|
|
|
26.0
|
|
|
Contract services
|
|
|
3.1
|
|
|
|
3.7
|
|
|
|
13.4
|
|
|
|
14.3
|
|
|
Total revenue
|
|
|
398.5
|
|
|
|
403.3
|
|
|
|
1,307.5
|
|
|
|
1,862.1
|
|
|
Cost of sales:
|
|
|
|
|
|
|
|
|
|
Separative work units and uranium
|
|
|
426.4
|
|
|
|
354.1
|
|
|
|
1,388.8
|
|
|
|
1,718.5
|
|
|
Contract services
|
|
|
3.4
|
|
|
|
3.3
|
|
|
|
13.6
|
|
|
|
14.2
|
|
|
Total cost of sales
|
|
|
429.8
|
|
|
|
357.4
|
|
|
|
1,402.4
|
|
|
|
1,732.7
|
|
|
Gross profit (loss)
|
|
|
(31.3
|
)
|
|
|
45.9
|
|
|
|
(94.9
|
)
|
|
|
129.4
|
|
|
Advanced technology costs
|
|
|
36.1
|
|
|
|
1,146.2
|
|
|
|
186.1
|
|
|
|
1,313.2
|
|
|
Selling, general and administrative
|
|
|
10.8
|
|
|
|
12.2
|
|
|
|
46.8
|
|
|
|
50.3
|
|
|
Special charges for workforce reductions and advisory costs
|
|
|
47.6
|
|
|
|
1.2
|
|
|
|
57.2
|
|
|
|
12.3
|
|
|
Other (income)
|
|
|
(30.1
|
)
|
|
|
(47.5
|
)
|
|
|
(154.3
|
)
|
|
|
(92.1
|
)
|
|
Operating (loss)
|
|
|
(95.7
|
)
|
|
|
(1,066.2
|
)
|
|
|
(230.7
|
)
|
|
|
(1,154.3
|
)
|
|
Interest expense
|
|
|
8.0
|
|
|
|
12.7
|
|
|
|
40.1
|
|
|
|
50.4
|
|
|
Interest (income)
|
|
|
(0.3
|
)
|
|
|
(1.5
|
)
|
|
|
(0.7
|
)
|
|
|
(1.9
|
)
|
|
(Loss) from continuing operations before income taxes
|
|
|
(103.4
|
)
|
|
|
(1,077.4
|
)
|
|
|
(270.1
|
)
|
|
|
(1,202.8
|
)
|
|
Provision (benefit) for income taxes
|
|
|
(28.7
|
)
|
|
|
8.0
|
|
|
|
(86.5
|
)
|
|
|
(1.0
|
)
|
|
Net (loss) from continuing operations
|
|
|
(74.7
|
)
|
|
|
(1,085.4
|
)
|
|
|
(183.6
|
)
|
|
|
(1,201.8
|
)
|
|
Net income from discontinued operations
|
|
|
3.0
|
|
|
|
1.1
|
|
|
|
24.7
|
|
|
|
1.2
|
|
|
Net (loss)
|
|
$
|
(71.7
|
)
|
|
$
|
(1,084.3
|
)
|
|
$
|
(158.9
|
)
|
|
$
|
(1,200.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) per share:
|
|
|
|
|
|
|
|
|
|
Net (loss) from continuing operations per share – basic and diluted
|
|
$
|
(15.24
|
)
|
|
$
|
(221.51
|
)
|
|
$
|
(37.47
|
)
|
|
$
|
(245.26
|
)
|
|
|
|
|
|
|
|
Net loss per share – basic and diluted
|
|
$
|
(14.63
|
)
|
|
$
|
(221.29
|
)
|
|
$
|
(32.43
|
)
|
|
$
|
(245.02
|
)
|
|
Weighted average number of shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
|
4.9
|
|
|
|
4.9
|
|
|
|
4.9
|
|
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USEC Inc.
|
|
CONSOLIDATED BALANCE SHEETS (Unaudited)
|
|
(millions, except share and per share data
|
|
|
|
|
|
|
|
December 31,
|
|
|
|
2013
|
|
2012
|
|
ASSETS
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
314.2
|
|
|
$
|
292.9
|
|
|
Accounts receivable, net
|
|
163.0
|
|
|
134.8
|
|
|
Inventories
|
|
967.6
|
|
|
1,593.2
|
|
|
Deferred costs associated with deferred revenue
|
|
165.5
|
|
|
116.8
|
|
|
Other current assets
|
|
21.7
|
|
|
19.2
|
|
|
Total Current Assets
|
|
1,632.0
|
|
|
2,156.9
|
|
|
Property, Plant and Equipment, net
|
|
7.9
|
|
|
51.0
|
|
|
Other Long-Term Assets
|
|
|
|
|
|
Deposits for surety bonds
|
|
39.8
|
|
|
22.3
|
|
|
Goodwill
|
|
—
|
|
|
6.8
|
|
|
Other assets
|
|
25.8
|
|
|
29.4
|
|
|
Total Other Long-Term Assets
|
|
65.6
|
|
|
58.5
|
|
|
Total Assets
|
|
$
|
1,705.5
|
|
|
$
|
2,266.4
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
114.5
|
|
|
145.8
|
|
|
Payables under Russian Contract
|
|
340.7
|
|
|
209.8
|
|
|
Inventories owed to customers and suppliers
|
|
499.7
|
|
|
950.0
|
|
|
Deferred revenue and advances from customers
|
|
195.9
|
|
|
125.5
|
|
|
Credit facility term loan
|
|
—
|
|
|
83.2
|
|
|
Convertible senior notes
|
|
530.0
|
|
|
—
|
|
|
Convertible preferred stock and accrued dividends payable-in-kind,
85,900 shares issued
|
|
113.9
|
|
|
100.5
|
|
|
Total Current Liabilities
|
|
1,794.7
|
|
|
1,614.8
|
|
|
Convertible Senior Notes
|
|
—
|
|
|
530.0
|
|
|
Other Long-Term Liabilities
|
|
|
|
|
|
Postretirement health and life benefit obligations
|
|
195.0
|
|
|
207.2
|
|
|
Pension benefit liabilities
|
|
121.2
|
|
|
321.7
|
|
|
Other liabilities
|
|
52.8
|
|
|
65.6
|
|
|
Total Other Long-Term Liabilities
|
|
369.0
|
|
|
594.5
|
|
|
Stockholders’ Equity (Deficit)
|
|
|
|
|
|
Preferred stock, par value $1.00 per share, 25,000,000 shares
authorized, no shares recorded as stockholders’ equity
|
|
—
|
|
|
—
|
|
|
Common stock, par value $.10 per share, 25,000,000 shares
authorized, 5,211,000 shares issued
|
|
0.5
|
|
|
0.5
|
|
|
Excess of capital over par value
|
|
1,216.4
|
|
|
1,213.3
|
|
|
Retained earnings (deficit)
|
|
(1,520.7
|
)
|
|
(1,361.8
|
)
|
|
Treasury stock, 226,000 and 203,000 shares
|
|
(34.3
|
)
|
|
(33.0
|
)
|
|
Accumulated other comprehensive loss, net of tax
|
|
(120.1
|
)
|
|
(291.9
|
)
|
|
Total Stockholders’ Equity (Deficit)
|
|
(458.2
|
)
|
|
(472.9
|
)
|
|
Total Liabilities and Stockholders’ Equity (Deficit)
|
|
$
|
1,705.5
|
|
|
$
|
2,266.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USEC Inc.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
|
(millions)
|
|
|
|
|
|
|
|
Years Ended December 31,
|
|
|
|
2013
|
|
2012
|
|
2011
|
|
Cash Flows from Operating Activities
|
|
|
|
|
|
|
|
Net (loss)
|
|
$
|
(158.9
|
)
|
|
$
|
(1,200.6
|
)
|
|
$
|
(491.1
|
)
|
|
Adjustments to reconcile net (loss) to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
27.6
|
|
|
37.5
|
|
|
50.1
|
|
|
Transfers and retirements of machinery and equipment
|
|
19.8
|
|
|
47.4
|
|
|
—
|
|
|
Expense of American Centrifuge capital assets
|
|
—
|
|
|
1,092.3
|
|
|
146.6
|
|
|
Deferred income taxes
|
|
—
|
|
|
—
|
|
|
252.0
|
|
|
Other non-cash income on release of disposal obligation
|
|
—
|
|
|
(92.1
|
)
|
|
(0.6
|
)
|
|
Convertible preferred stock dividends payable-in-kind
|
|
13.4
|
|
|
11.9
|
|
|
10.4
|
|
|
Gain on sale of subsidiary
|
|
(35.6
|
)
|
|
—
|
|
|
—
|
|
|
Gain on extinguishment of convertible notes
|
|
—
|
|
|
—
|
|
|
(3.1
|
)
|
|
Inventory valuation adjustments
|
|
15.2
|
|
|
—
|
|
|
—
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
Accounts receivable – (increase) decrease
|
|
(28.2
|
)
|
|
1.4
|
|
|
146.6
|
|
|
Inventories, net – (increase) decrease
|
|
160.1
|
|
|
238.7
|
|
|
(75.2
|
)
|
|
Payables under Russian Contract – increase
|
|
130.9
|
|
|
2.9
|
|
|
5.7
|
|
|
Deferred revenue, net of deferred costs – increase
|
|
20.9
|
|
|
90.3
|
|
|
5.2
|
|
|
Accounts payable and other liabilities – increase (decrease)
|
|
(82.5
|
)
|
|
27.2
|
|
|
(10.6
|
)
|
|
Accrued depleted uranium disposition – increase (decrease)
|
|
0.4
|
|
|
(145.0
|
)
|
|
19.8
|
|
|
Other, net
|
|
(1.9
|
)
|
|
31.0
|
|
|
0.5
|
|
|
Net Cash Provided by Operating Activities
|
|
81.2
|
|
|
142.9
|
|
|
56.3
|
|
|
|
|
|
|
|
|
|
|
Cash Flows Provided by Investing Activities
|
|
|
|
|
|
|
|
Capital expenditures
|
|
—
|
|
|
(4.3
|
)
|
|
(152.8
|
)
|
|
Deposits for surety bonds - net (increase) decrease
|
|
(17.5
|
)
|
|
129.1
|
|
|
(10.4
|
)
|
|
Proceeds from sale of subsidiary
|
|
43.2
|
|
|
—
|
|
|
—
|
|
|
Net Cash Provided by (Used in) Investing Activities
|
|
25.7
|
|
|
124.8
|
|
|
(163.2
|
)
|
|
|
|
|
|
|
|
|
|
Cash Flows Used in Financing Activities
|
|
|
|
|
|
|
|
Borrowings under revolving credit facility
|
|
—
|
|
|
123.6
|
|
|
80.9
|
|
|
Repayments under revolving credit facility
|
|
—
|
|
|
(123.6
|
)
|
|
(80.9
|
)
|
|
Repayment of credit facility term loan
|
|
(83.2
|
)
|
|
(1.8
|
)
|
|
—
|
|
|
Payments for deferred financing costs
|
|
(2.2
|
)
|
|
(10.1
|
)
|
|
(5.0
|
)
|
|
Common stock issued (purchased), net
|
|
(0.2
|
)
|
|
(0.5
|
)
|
|
(1.5
|
)
|
|
Net Cash (Used in) Financing Activities
|
|
(85.6
|
)
|
|
(12.4
|
)
|
|
(6.5
|
)
|
|
Net Increase (Decrease)
|
|
21.3
|
|
|
255.3
|
|
|
(113.4
|
)
|
|
Cash and Cash Equivalents at Beginning of Period
|
|
292.9
|
|
|
37.6
|
|
|
151.0
|
|
|
Cash and Cash Equivalents at End of Period
|
|
$
|
314.2
|
|
|
$
|
292.9
|
|
|
$
|
37.6
|
|
|
|
|
|
|
|
|
|
|
Supplemental Cash Flow Information:
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
20.7
|
|
|
$
|
27.5
|
|
|
$
|
4.5
|
|
|
Income taxes paid, net of refunds
|
|
0.4
|
|
|
—
|
|
|
—
|
|
Source: USEC Inc.
USEC Inc.
Investors: Steven Wingfield, 301-564-3354
Media:
Paul Jacobson, 301-564-3399
