Cameco doubles 2023 sales, prices compared to year earlier

Higher sales volumes and realized prices for uranium production and fuel services meant that Cameco’s (TSX: CCO; NYSE: CCJ) 2023 net earnings and cash from operations more than doubled compared to 2022. And adjusted EBITDA was up 93%.

That was the good news delivered this week by Cameco president and CEO Tim Gitzel. And strong financial performance is also expected this year.

“The benefits of nuclear power have come clearly into focus, with 28 countries around the world declaring support for the tripling of capacity to help achieve global net-zero greenhouse gas emissions by 2050. The uncertainty about where nuclear fuel supplies will come from to satisfy growing demand has led to increased long-term contracting activity, and in 2023, about 160 million lb. of uranium was placed under long-term contracts by utilities,” said Gitzel.

Prices across the nuclear fuel cycle rose in 2023 and continue to rise. Uranium spot prices more than doubled to US$100/lb. at the end of January 2024, after being only US$48 at the end of 2022. The long-term price for uranium was US$72/lb., an increase of about 38% over the same period.

Year-end revenue for 2023 was $2.59 billion, up from $1.87 billion for 2022. Gross profit was $562 million ($233 million) and net earnings were $361 million ($89 million). Adjusted EPITDA was $831 million, compared to $431 million in 2022. Cash provided by operations in 2023 was $688 million ($305 million).

One notable accomplishment last year was adding a 49% interest in Westinghouse to the Cameco portfolio. Brookfield Asset Management retained the remaining 51% interest.

“We believe Westinghouse is well-positioned for long-term growth driven by the expected increase in global demand for nuclear power,” said Gitzel. “In 2024, we expect our share of its adjusted EBITDA to be between $445 million and $510 million. Further, over the next five years, we expect its adjusted EBITDA will grow at a compound annual growth rate of 6% to 10%.”

On the mining side, Cameco is planning to produce 18 million lb. of uranium oxide (U₃O₈) at each of the McArthur River-Key Lake and the Cigar Lake mines this year. Reserves saw a boost of 73.4 million lb. U₃O₈ at Cigar Lake, of which Cameco’s share is 40%. The increase also has the potential to extend the mine life to 2036. The company looking ahead to expand annual production to 25 million lb. (on a 100% basis) when the time is right.

Cameco produced 17.6 million lb. U₃O₈ in 2023 (compared to 10.4 million lb. in 2022), resulting in 2023 net earnings of $606 million ($121 million).

In the fuel services sector, the company produced 13.3 million kg elemental uranium in 2023 (compared to 13.0 million kg in 2022), giving it net earnings of $129 million ($120 million).

The  year-end financial details are available on www.Cameco.com.