REG - JSC NAC Kazatomprom - Kazatomprom 1H23 Financial Results
25/08/2023 08:15
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RNS Number : 4542K JSC National Atomic Co. Kazatomprom 25 August 2023
AIX: KAP, KAP.Y (GDR)
LSE: KAP (GDR)
Currency: KZT (₸), unless otherwise noted
25 August 2023, Astana, Kazakhstan
Kazatomprom 1H23 Financial Results
JSC National Atomic Company "Kazatomprom" ("Kazatomprom", "KAP" or "the
Company") announces its consolidated financial results for the first half-year
ended 30 June 2023, prepared in accordance with International Financial
Reporting Standards (IFRS). The Company also discloses changes in its
Management.
"The Company demonstrated strong financial results for the first half of 2023,
which reflects a significant improvement in the situation on the uranium
market over the past year. Revenue increased by 25% compared to the first half
of 2022 and amounted to almost 619 billion tenge, which led to an increase in
operating profit by 46%, and a near 33% increase in net profit to 222 billion
tenge. This is mainly to due to an increase in uranium prices as well as in
the sales volume associated with changes in the timing of customer requests
for supply and corresponding differences in delivery schedules in the first
half of 2023 and 2022. As for operational indicators, production volumes in
the first half of 2023 were nearly at the same level as in the same period of
2022. As it was announced earlier all 2023 guidance metrics, except for
production volumes, were revised using the updated spot prices estimates,
exchange rates and sales portfolio expansion" - said Yerzhan Mukanov,
Kazatomprom's Chairman of the Board. "We have repeatedly stated that we will
closely monitor the market situation to determine the need to increase the
production volumes to 100% level in accordance with subsoil use contracts.
Given the steady improvement in the dynamics of supply and demand, Kazatomprom
as before plans to increase production volumes in 2024 in accordance with
market fundamentals and expansion of the contract portfolio."
"Kazatomprom will continue to take an active part in the cycle of mid- and
long-term contract activity against anticipated growing demand for nuclear
fuel, backed by our now-proven commitment to creating long-term value for our
stakeholders by maintaining flexibility and discipline in production and
sales," - said Dastan Kosherbayev, Chief Commercial Officer.
Corporate Update
Management changes
Ruslan Beketayev, Chief Financial Officer of Kazatomprom, decided to leave his
role effective 25 August 2023 at and pursue other opportunities. Mr. Beketayev
has held the Chief Financial Officer position since 11 January 2023.
Starting from 28 August 2023, Sultan Temirbayev will be appointed as CFO of
Kazatomprom. Previously, for three years Mr. Sultan Temirbayev held the
position of deputy CFO at JV Inkai LLP, a joint venture of Kazatomprom (60%
equity share) and Cameco Corporation. Sultan Temirbayev graduated from the
University of Durham (UK) in 2008 with a Bachelor's degree in Economics and
has a PMP (Project Management Professional) certificate. This appointment
corresponds to the approved succession plan of the Company.
Mr. Sultan Temirbayev is expected to be appointed to the Management Board,
subject to internal and Board of Directors approvals, as per corporate
governance procedures.
Key financial metrics
Six months
ended 30 June
(KZT billion unless noted) 2023 2022 Change
Group's consolidated revenue 618,7 493,7 25%
Operating profit 252,5 172,8 46%
Net profit 222,3 167,4 33%
Earnings per share attributable to owners (basic and diluted), 695 467 49%
KZT/share(1)
Adjusted EBITDA(2) 331,2 224,5 48%
Attributable EBITDA(3) 278,3 182,8 52%
Operating cash flow(4) 419,8 256,2 64%
(1) Calculated as: Profit for the period attributable to owners of the Company
divided by total share capital, rounded to the nearest KZT.
(2) Adjusted EBITDA is calculated by excluding from EBITDA items not related
to the main business and having a one-time effect.
(3) Attributable EBITDA (previously "Adjusted Attributable EBITDA") is
calculated as Adjusted EBITDA less the share of the results in the net profit
in JVs and associates, plus the share of Adjusted EBITDA of JVs and associates
engaged in the uranium segment (except JV Budenovskoye LLP's EBITDA due to
minor effect it has during each reporting period), less non-controlling share
of adjusted EBITDA of Appak LLP, JV Inkai LLP, Baiken-U LLP, MC Ortalyk LLP
and JV Khorasan-U LLP, less any changes in the unrealized gain in the Group.
(4) Includes income tax and interest paid.
Operating and Financial Review and Financial Statements
The Operating and Financial Review, and Consolidated Financial Statements
(unaudited, reviewed) provide detailed explanations of Kazatomprom's results
for the first half-year ended 30 June 2023 with guidance for 2023. This press
release should be read alongside these documents, all of which are available
at www.kazatomprom.kz.
(https://www.kazatomprom.kz/en/investors/finansovaya_otchetnost/page-1)
Changes in the Group structure
In the first half of 2023 the Group completed the following transactions:
· According to the plans for the sale of non-core assets as
presented in the Company's 2018 IPO Prospectus, a contract for the purchase
and sale of 40% of the shares of Caustic JSC was signed on 30 December 2021
between Kazatomprom and United Chemical Technologies Trading house LLP. On
March 28, 2023, United Chemical Technologies Trading House LLP made full
payment according to the purchase and sale agreement. On April 07, 2023,
Central Securities Depository JSC transferred shares from Kazatomprom's
account. To date, the transaction has been completed in full.
· Kazatomprom received a certificate of state registration of a new
entity Taiqonyr Qyshqyl Zauyty LLP, aimed to implement a project for the
construction of a sulfuric acid plant in the Sozak district of Turkestan
region. The participants of Taiqonyr Qyshqyl Zauyty LLP: Kazatomprom (49%),
RU-6 LLP (25%), Kazatomprom-SaUran LLP (26%).
Revenue, net profit, EBITDA
During the first half of 2023 the Group's consolidated revenue was
KZT 618,744 million, an increase of 25% compared to the same period of
2022 (KZT 493,716 million in the first half of 2022). The increase was
mainly due to:
· growth in the average realized price associated with an increase
in the market spot price for U(3)O(8);
· an increase in sales volume in the first half of 2023 in
comparison to the same period of 2022 mainly related to the changes in the
timing of customer requirements and the resulting differences in the timing of
deliveries for first half of 2023 and 2022;
· increase in revenue from uranium products (fuel pellets), and UMP
segment rare metal products.
Operating profit in the first half of 2023 was KZT 252,497 million, an
increase of 46% compared to the same period of 2022 (KZT 172,818 million
in the first half of 2022). The increase was mainly due to higher revenues in
2023 as indicated above.
Net profit in the first half of 2023 was KZT 222,333 million, an increase
of 33% compared to the same period of 2022 (KZT 167,374 million in the
first half of 2022). The increase was mainly due to higher operating profit in
the first half of 2023 as indicated above. There were no significant adjusting
one-time effects during the first halves of 2023 and 2022. Profit for the
period attributable to non-controlling interest decreased during the first
half of 2023 compared to the same period of 2022, was influenced by the
compensation to the Government from MC Ortalyk LLP.
Adjusted EBITDA totalled KZT 331,248 million in the first half of 2023, an
increase of 48% compared to the same period of 2022 (KZT 224,457 million
in the first half of 2022), while attributable EBITDA was
KZT 278,257 million in the first half of 2023, an increase of 52% compared
to the same period of 2022 (KZT 182,825 million in the first half of 2022).
These changes were mainly driven by a higher operating profit on consolidated
level and a higher EBITDA of JVs and associates mostly affected by the growth
in the average realized price associated with an increase in the market spot
price for U(3)O(8).
Cost of sales
Cost of sales totalled KZT 320,543 million in the first half of 2023, an
increase of 10% compared to the same period of 2022
(totalled KZT 291,532 million in the first half of 2022) mainly due to
higher sales volume of U(3)O(8) in the first half of 2023.
The cost of materials and supplies was KZT 194,574 million in the first half
of 2023, a decrease of 4% compared to the same period of 2022
(KZT 202,194 million in the first half of 2022) due to decrease in the
proportion of sales of uranium purchased from JVs and associates, as well as
from third parties (when such uranium is sold, the cost of sales is
predominantly represented by the cost of purchased materials and supplies at
the prevailing spot price with certain applicable discounts). However, the
purchase price of materials and supplies, including U(3)O(8,) increased as a
result of inflationary pressure and an increase in the spot prices.
Selling expenses
Selling expenses totalled KZT 13,521 million in the first half of 2023
(KZT 10,592 million in the first half of 2022), a significant increase
compared to the same period of 2022. The increase was due to an increase in
transportation tariffs.
General & administrative expenses (G&A)
General and administrative expenses in the first half of 2023 amounted to 32,183 million tenge (18,774 million tenge in the same period of 2022).
The increase in G&A expenses includes amount of KZT 11,357 million payable
to the government, which the entity is remitting to the Republic's budget for
the unaccounted volume of extracted uranium by MC Ortalyk LLP. Additionally,
the Company has accrued a provision for the payment of compensation to the
second party of the entity, amounting to KZT 4,657 million as explained below.
Provision for compensation payment for unauthorised volume of uranium produced
at Zhalpak field
Provision for payment of compensation for the unauthorised volume of uranium
relates to MC Ortalyk LLP (hereinafter- Partnership). In October 2017, the
Partnership obtained a Contract for uranium exploration at Zhalpak field for a
period up to 31 May 2018. In May 2018, the Ministry of Energy of the Republic
of Kazakhstan agreed to extend the exploration period under the Contract until
31 December 2022 for performing evaluation works. However, the approval
process of the Project of Evaluation Works by the Ministry of Energy of the
Republic of Kazakhstan was delayed. In May 2020, the Partnership stopped all
work that was reported to the Ministry of Energy of the Republic of Kazakhstan
by information letter. Test production was stopped in April 2020. In December
2021, the Company transferred subsoil use rights to the Partnership. The
volume of unauthorised uranium at the Zhalpak field for the period from June
2018 to April 2020 amounted to 162.454 tons. In early 2023 the issue of paying
compensation for the unauthorised volume of uranium began to be actively
discussed with the government authorities. According to preliminary
calculations, as of the reporting date, the amount of compensation to the
Government is KZT 11,357 million.
On 15 August 2023 MC Ortalyk LLP paid a compensation of KZT 11,404 million to
the Government for unauthorised volume of uranium including exchange rate
difference at the date of payment.
Provision for compensation payment to the second participant of the subsidiary
According to the sale and purchase agreement of the 49% stake (hereinafter-
Agreement) in the MC Ortalyk LLP, in the event of an obligation of the
Partnership in respect of any unpaid amount in exceeding the threshold of
2,000,000 US dollars not accounted for as part of the sale and purchase of
stake in the Partnership, and that occurred before the second participant
joined the Partnership, the Company is obliged to reimburse 49% of the
compensation amount to the second participant, except for the amount at the
established threshold in accordance with the Agreement. Taking into account
the obligation of the Partnership to pay compensation for the unsettled volume
of uranium, the preliminary cost of which is KZT 11,357 million, the Company
has accrued a provision for payment of compensation to the second participant
of the Partnership in the amount of KZT 4,657 million.
Liquidity
The Group manages its liquidity requirements to ensure the continued
availability of cash sufficient to meet its obligations on time, avoid
unacceptable losses, and settle its financial obligations without jeopardizing
its reputation.
(KZT million) As at June 30, 2023 As at December 31, 2022 As at June 30, 2022 Change for six months of 2023
Cash and cash equivalents 268,467 169,536 380,394 58%
Current term deposit 18,947 930 8 >200%
Total cash 287,414 170,466 380,402 69%
Undrawn borrowing facilities 83,714 84,665 165,560 (1%)
The Group's total cash and cash equivalents, including current term deposits
at 30 June 2023 were KZT 287,414 million, increasing by 69% compared to
KZT 170,466 million as at 31 December 2022, mainly due to the accumulation
of cash prior to the distribution of the 2022 dividend. The Group's total cash
and cash equivalents of KZT 287,414 million, including current term deposits
at 30 June 2023 were lower in comparison to KZT 380,402 million as of 30 June
2022, mainly due to investments made during the first half of 2023 in
short-term debt securities amounted to KZT 211,309 million.
Undrawn borrowing facilities are the credit lines available to the Group and
considered as an additional liquidity source payable within 12 months,
primarily used to temporarily cover cash deficits related to uneven receipts
of trade receivables. As at 30 June 2023, the Group's available limit of
revolving credit lines comprised a total of KZT 106,340 million (USD 235
million), of which KZT 83,714 million (USD 185 million) were available for
use, while as at 31 December 2022 the Group's available limit of revolving
credit lines comprised a total of KZT 108,723 million (USD 235 million) of
which KZT 84,665 million (USD 183 million) were available for use; as at
30 June 2022, the Group's available limit of revolving credit lines available
in full comprised a total of KZT 165 560 million (USD 352 million). The
decrease in undrawn borrowing facilities balance as at December 31, 2022 in
comparison to June 30, 2022 was primarily related to the closure of unused
credit lines.
Debt leverage ratios
The following table summarises the key ratios used by the Company's management
to measure financial stability. Management targets a net debt to adjusted
EBITDA of less than 1.0.
(KZT million) As at June 30, 2023 As at December 31, 2022 As at June 30, 2022 Change for six months of 2023
Total debt (excluding guarantees) 110,682 138,444 97,971 (20%)
Total cash balances (see Section 7.1) (287,414) (170,466) (380,402) 69%
Net debt (176,732) (32,022) (282,431) >200%
Adjusted EBITDA* 737,689 630,898 475,356 17%
Net debt / Adjusted EBITDA (coefficient) (0.24) (0.05) (0.59) >200%
* For the purposes of "Net debt/Adjusted EBITDA (coefficient)" calculation
Adjusted EBITDA for the six months 2023 and 2022 was calculated for 12
months (the first half of the reporting period and the second half of the
previous period). Adjusted EBITDA is calculated as Profit before tax - finance
income + finance expense +/- Net FX loss/(gain) + Depreciation and
amortisation + Impairment losses - reversal of impairment +/- one-off or
unusual transactions.
Uranium segment production and sales metrics
Six months
ended 30 June
2023 2022 Change
Production volume of U(3)O(8) (100% basis) tU 10,225 10,070 2%
Production volume of U(3)O(8) (attributable basis)(1) tU 5,411 5,414 0%
U(3)O(8) sales volume (consolidated)(2) tU 9,527 9,017 6%
Including KAP U(3)O(8) sales volume(2) tU 8,565 8,032 7%
Group inventory of finished goods (U(3)O(8)) tU 7,644 9,276 (18%)
Including KAP inventory of finished goods (U(3)O(8))(3) tU 6,031 7,156 (16%)
Group average realized price KZT/kg 55,257 47,807 16%
Group average realized price USD/lb 47.04 40.88 15%
KAP average realized price(4) USD/lb 46.63 39.70 17%
Average weekly spot price USD/lb 52.16 50.31 4%
Average month-end spot price(5) USD/lb 52.60 50.09 5%
(1) The Production volumes of U(3)O(8) (attributable basis) are not equal to
the volumes purchased by KAP headquarters (HQ) in the Section 4.8 Transactions
with subsidiaries, JVs, JOs and associates.
(2) KAP U(3)O(8) sales volume (incl. in Group): includes only the total
external sales of KAP HQ and THK. Intercompany transactions between KAP HQ and
THK are not included. Yet, some part of Group U(3)O(8) production goes to the
production of EUP, fuel pellets and fuel assemblies (FA) at Ulba-FA LLP.
(3) KAP inventory of finished goods (incl. in Group): includes the inventories
of KAP HQ and THK.
(4) KAP average realized price: the weighted average price per pound for the
total external sales of KAP and THK. The pricing of intercompany transactions
between KAP and THK are not included.
(5) Source: UxC, TradeTech. Values provided represent the average of the
uranium spot prices quoted at month end, and not the average of each weekly
quoted spot price, as contract price terms generally refer to a month-end
price.
Production (on both a 100% basis and an attributable basis) in the first half
of 2023 were nearly on the same level compared to the same period in 2022.
In the first half of 2023, both Group and KAP sales volumes were higher
compared to the same period in 2022, primarily due to timing of
customer-scheduled deliveries, decreasing the inventory volumes on both
consolidated (i.e., Group) and at the level of Kazatomprom HQ and THK (see
footnote below the table above). Sales volumes may vary substantially each
period based on timing of customer delivery requests during the year and terms
of physical delivery activity.
Consolidated Group inventory of finished U(3)O(8) products as at 30 June 2023
amounted to 7,644 tonnes, which was 18% lower than as at 30 June 2022 (as at
30 June 2022 amounted to 9,276 tonnes). At the level of Kazatomprom HQ and
THK the inventory of finished U(3)O(8) products was 6,031 tonnes, a decrease
of 16% compared to 30 June 2022 (as at 30 June 2022 amounted to
7,156 tonnes). Overall, the decrease in inventory is attributed to the
increased sales.
Average realized price for the first half of 2023 was higher compared to the
same period in 2022 due to higher uranium spot price. The Company's current
overall contract portfolio pricing correlates to uranium spot prices. However
deliveries under some long-term contracts in the first half of 2023
incorporated a proportion of fixed pricing that was negotiated during a lower
price environment.
In the uranium market, the trends in quarterly metrics and interim results are
rarely representative of annual expectations; for annual expectations, please
see the Company's guidance metrics for 2023 below, and the price sensitivity
table from Section 10.0 "Guidance for 2023" and subsection 10.1 Uranium sales
price sensitivity analysis, respectively, in the Company's Operating and
Financial Review for the six months ended June 30, 2023.
Uranium segment costs and capital expenditures
Six months
ended 30 June
(KZT million unless noted) 2023 2022 Change
C1 Cash cost (attributable basis) USD/lb 12.18 9.97 22%
Capital cost (attributable basis) USD/lb 7.22 5.33 35%
All-in sustaining cash cost (attributable C1 + capital cost)(1) USD/lb 19.40 15.30 27%
Capital expenditures of mining companies (100% basis)(2) 76,845 56,293 37%
(1) For the first half 2023 year the all-in sustaining cash cost excluding the
expenditures for the expansion is 18.80 USD/lb. In the first half of 2022
significant CAPEX for expansion projects are excluded.
(2) Excludes liquidation funds and closure costs. Note that in Section 6.0
CAPITAL EXPENDITURES REVIEW total results include liquidation funds and
closure cost.
ESG Update at Kazatomprom
In December 2022, the international rating agency S&P Global Ratings ("the
Agency") assigned Kazatomprom its first independent ESG rating at a score of
51 (the global average score for the mining sector is 50). Of note, the
current global maximum ESG evaluation score among Metal & Mining sector
companies is 68 (of 100) with a global Metal & Mining sector average of 50
(of 100). The Agency's assessment was based upon an in-depth analysis of
Kazatomprom's exposure to mining, environmental and social risks. In 2023,
Kazatomprom continued its efforts to improve its sustainability performance.
Based on the assessment of the Agency and the world's best practices,
2023-2024 Roadmap for ESG practices advancement at Kazatomprom has been
developed and approved by the Board of Directors.
Adhering to global priorities and following the national strategy, Kazatomprom
also strives to contribute to the fight against climate change. In the
reporting period, the Company included climate risks in the risk register. In
order to implement the Decarbonization and Carbon Neutrality Strategy until
2060, approved by the Board of Directorsin December 2022, the Comprehensive
Action Plan for Decarbonization and Carbon Neutrality of Kazatomprom until
2040 was developed and approved. In addition, for the first time the Company
completed and submitted the CDP (Carbon Disclosure Project) questionnaire on
climate change to obtain an international climate rating.
Kazatomprom recognizes its responsibility for the impact on the environment,
health, safety and quality of life of people. Since the beginning of the year,
the Company has been working on the development of a Water Resources
Management Strategy and a Radioactive Waste Management Program.
The Company continued to improve the practice of disclosing non-financial
information. The Integrated Annual Report of Kazatomprom for 2022 has been
prepared in accordance with GRI, SASB and TCFD standards. Also, in the current
period, Kazatomprom, for the first time, has prepared a Progress Report for
the UN Global Compact, in which the Company has been a party since March last
year.
Health, safety and environment (HSE) results
Active measures continued to be undertaken in the first half of 2023 to focus
on safety awareness, which helped to prevent major industrial accidents
(including uncontrolled explosions, emissions of dangerous substances or
destruction of buildings) and production injuries at the Company's
enterprises.
The following table reflects safety results of the first half of 2022-2023:
Six months
ended 30 June
Indicator 2023 2022 Change
Industrial accidents(1) - - -
LTIFR (per million man-hours)(2) 0.31 - -
Unsafe conditions, unsafe actions, near-miss reporting 18,422 18,049 2%
Number of accidents(3) 4 - -
Fatalities - - -
(1) Defined as uncontrolled explosions, emissions of dangerous substances, or
destruction of buildings.
(2) Lost-Time Injury Frequency Rate (LTIFR) per million hours.
(3) Defined as impact on the employee of a harmful and (or) dangerous
production factor in performance of his work (job) duties or tasks of the
employer, which resulted in an industrial accident, sudden deterioration of
health, or poisoning of the employee that led to temporary or persistent
disability, or death.
The Group continues to pay significant attention to improving health and
safety in the workplace. However, despite the comprehensive measures taken
during the first half of 2023, there were four (4) accidents in which five (5)
employees were injured. After each accident, thorough special and internal
investigations were conducted, identifying the root causes, developing
preventive measures, and modifying procedures to prevent the recurrence of
similar incidents in the future. The investigation results were communicated
to all Group entities so that each one could learn from the events and
appropriately adjust their processes. The Company will continue its efforts to
enhance employee engagement and awareness in matters of ensuring production
safety.
Kazatomprom's 2023 Guidance
2023
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Production volume U(3)O(8) (tU) (100% basis)(1) 20,500 - 21,500(2) 20,500 - 21,500(2)
Production volume U(3)O(8) (tU) (attributable basis)(3) 10,600 - 11,200(2) 10,600 - 11,200(2)
Group U(3)O(8) sales volume (tU) (consolidated)(4) 15,400 - 15,900 17,500 - 18,000
Incl. KAP U(3)O(8) sales volume (incl. in Group) (tU)(5) 12,100 - 12,600 14,500 - 15,000
Revenue - consolidated (KZT billions)(6) 1,080 - 1,090 1,270 - 1,310
Revenue from Group U(3)O(8) sales, (KZT billions)(6) 820 - 840 1,020 - 1,060
C1 cash cost (attributable basis) (USD/lb)(*) $12.00 - $13.50 $13.00 - $14.50
All-in sustaining cash cost (attributable C1 + capital cost) (USD/lb)(7*) $20.00 - $21.50 $21.00 - $22.50
Total capital expenditures of mining entities (KZT billions) (100% basis)(8) 240 - 250 220 - 230
(1) Production volume U3O8 (tU) (100% basis): Amounts represent the entirety
of production of an entity in which the Company has an interest; it disregards
that some portion of production may be attributable to the Group's JV partners
or other third-party shareholders. Actual drummed production volumes remain
subject to converter adjustments and adjustments for in-process material.
(2) The duration and full impact of the Russian-Ukrainian conflict is not yet
known. Annual production volumes could therefore vary from internal
expectations.
(3) Production volume U3O8 (tU) (attributable basis): Amounts represent the
portion of production of an entity in which the Company has an interest,
corresponding only to the size of such interest; it excludes the portion
attributable to the JV partners or other third-party shareholders, except for
JV "Inkai" LLP, where the annual share of production is determined as per
Implementation Agreement as disclosed in IPO Prospectus. Actual drummed
production volumes remain subject to converter adjustments and adjustments for
in-process material.
(4) Group sales volume: includes the sales of U3O8 by Kazatomprom's sales and
those of its consolidated subsidiaries (companies that KAP controls by having
(i) the power to direct their relevant activities that significantly affect
their returns, (ii) exposure, or rights, to variable returns from its
involvement with these entities, and (iii) the ability to use its power over
these entities to affect the amount of the Group's returns. The existence and
effect of substantive rights, including substantive potential voting rights,
are considered when assessing whether KAP has power to control another
entity). For consistency, Group U3O8 sales volumes do not include other forms
of uranium products (including, but not limited to, the sales of fuel pellets
and EUP). Yet, some part of Group U3O8 production goes to the production of
EUP, fuel pellets and fuel assemblies (FA) at Ulba-FA LLP.
(5) KAP sales volume: includes only the total external sales of U3O8 of KAP HQ
and THK. Intercompany transactions between KAP HQ and THK are not included.
(6) Revenue estimates have only been updated to account for a change in
expectations for uranium price and exchange rate for the Kazakhstani Tenge.
Revenue expectations are based on uranium prices taken at a single point in
time using third-party sources and on an internal exchange rate assumption of
KZT/USD 460. 2023 revenue could be materially impacted by how actual uranium
prices and exchange rates vary from the described assumptions.
(7) Excluding capital expenditure for expansion, the project range will be
$20.5 - $22.00 USD/lb.
(8) Total capital expenditures (100% basis): includes only capital
expenditures of the mining entities, includes significant CAPEX for investment
and expansion projects. Excludes liquidation funds and closure costs. For 2023
includes new well construction and mine development costs of JV Budenovskoye
LLP and JV KATCO LLP (South Tortkuduk) for a total amount of approximately KZT
50 billion. Excluding capital expenditure for expansion, the projected range
will be KZT 200 - 210 billion.
* Please note that the conversion of kgU to pounds U3O8 is 2.5998
As was previously disclosed in Kazatomprom 2Q2023 Operations and Trading
Update, available on the corporate website, www.kazatomprom.kz
(http://www.kazatomprom.kz/) all 2023 guidance metrics except for production
volumes on both 100% and attributable basis were revised using the updated
spot prices estimates, exchange rates and sales portfolio expansion. The
Company expects an increase in sales volume compared to previous guidance
indicators due to customer requests to flex up their annual deliveries under
existing contracts, the conclusion of new long-term contracts with the
delivery in 2023, as well as Yellow Cake plc.'s execution of its annual option
to purchase uranium from KAP.
At this time, all 2023 guidance metrics remain unchanged from previously
disclosed expectations set out in Kazatomprom 2Q2023 Operations and Trading
Update.
Revenue, C1 cash cost (attributable basis) and All-in Sustaining Cash Cost
(attributable C1 + capital cost) may vary from the ranges shown, depending on
the extent that the USD / KZT exchange rate and uranium spot price differ from
the Company's assumptions.
The Company only intends to update annual guidance in relation to operational
factors and internal changes that are within its control. Key assumptions used
for external metrics, such as exchange rates and uranium prices, are
established using third-party sources during the Company's annual budget
process in the previous year or adjustments made due to high volatility in the
current year; such assumptions will only be updated on an interim basis in
exceptional circumstances.
Conference Call Notification - 2023 Half-Year Operating and Financial Review
(25 August 2023)
Kazatomprom has scheduled a conference call to discuss the 2023 half-year
operating and financial results, after they are released on 25 August 2023.
The call will begin at 17:00 (AST) / 12:00 (BST) / 07:00 (ET). Following
management remarks, an interactive English Q&A session will be held with
investors.
For the English live webcast (participants on the webcast can also submit
questions during the event), conference call dial-in details and for
information on how to participate in the Q&A, please visit:
https://www.lsegissuerservices.com/spark/JSCNationalAtomicCoKazatomprom/events/2db13238-705c-4c10-85ef-0bfebd7f3e6c
(https://www.lsegissuerservices.com/spark/JSCNationalAtomicCoKazatomprom/events/2db13238-705c-4c10-85ef-0bfebd7f3e6c)
For the Russian live webcast (listen-only, no Q&A) and corresponding
dial-in details, please visit:
https://www.lsegissuerservices.com/spark/JSCNationalAtomicCoKazatomprom/events/b672bfe2-cd74-448e-a6d9-1327eba53cde
(https://www.lsegissuerservices.com/spark/JSCNationalAtomicCoKazatomprom/events/b672bfe2-cd74-448e-a6d9-1327eba53cde)
A recording of the webcast will also be available at www.kazatomprom.kz
(https://www.kazatomprom.kz/) shortly after it concludes.
For further information, please contact:
Kazatomprom Investor Relations Inquiries
Yerlan Magzumov, Director of Investor Relations
Tel: +7 (8) 7172 45 81 80
Email: ir@kazatomprom.kz (mailto:ir@kazatomprom.kz)
Kazatomprom Public Relations and Media Inquiries
Sabina Kumurbekova, Director of PR Department
Gazhaiyp Kumisbek, Chief Expert of PR Department
Tel: +7 (8) 7172 45 80 63
Email: pr@kazatomprom.kz (mailto:pr@kazatomprom.kz)
About Kazatomprom
Kazatomprom is the world's largest producer of uranium, with the Company's
attributable production representing approximately 22% of global primary
uranium production in 2022. The Group benefits from the largest reserve base
in the industry and operates, through its subsidiaries, JVs and Associates, 26
deposits grouped into 14 mining assets. All of the Company's mining operations
are located in Kazakhstan and extract uranium using ISR technology with a
focus on maintaining industry-leading health, safety and environmental
standards (ISO 45001 and ISO 14001 compliant).
Kazatomprom securities are listed on the London Stock Exchange, Astana
International Exchange, and Kazakhstan Stock Exchange. As the national atomic
company in the Republic of Kazakhstan, the Group's primary customers are
operators of nuclear generation capacity, and the principal export markets for
the Group's products are China, South and Eastern Asia, Europe and North
America. The Group sells uranium and uranium products under long-term
contracts, short-term contracts, towards the second shareholders of jointly
owned subsidiaries, as well as in the spot market, directly from its
headquarters in Astana, Kazakhstan, and through its Switzerland-based trading
subsidiary, Trade House KazakAtom AG (THK).
For more information, please see the Company website at www.kazatomprom.kz
(https://www.kazatomprom.kz/)
Forward-looking statements
All statements other than statements of historical fact included in this
communication or document are forward-looking statements. Forward-looking
statements give the Company's current expectations and projections relating to
its financial condition, results of operations, plans, objectives, future
performance and business. These statements may include, without limitation,
any statements preceded by, followed by or including words such as "target",
"believe", "expect", "aim", "intend", "may", "anticipate", "estimate", "plan",
"project", "will", "can have", "likely", "should", "would", "could" and other
words and terms of similar meaning or the negative thereof. Such
forward-looking statements involve known and unknown risks, uncertainties and
other important factors beyond the Company's control that could cause the
Company's actual results, performance or achievements to be materially
different from the expected results, performance or achievements expressed or
implied by such forward-looking statements. Such forward-looking statements
are based on numerous assumptions regarding the Company's present and future
business strategies and the environment in which it will operate in the
future.
THE INFORMATION WITH RESPECT TO ANY PROJECTIONS PRESENTED HEREIN IS BASED ON A
NUMBER OF ASSUMPTIONS ABOUT FUTURE EVENTS AND IS SUBJECT TO SIGNIFICANT
ECONOMIC AND COMPETITIVE UNCERTAINTY AND OTHER CONTINGENCIES, NONE OF WHICH
CAN BE PREDICTED WITH ANY CERTAINTY AND SOME OF WHICH ARE BEYOND THE CONTROL
OF THE COMPANY. THERE CAN BE NO ASSURANCES THAT THE PROJECTIONS WILL BE
REALISED, AND ACTUAL RESULTS MAY BE HIGHER OR LOWER THAN THOSE INDICATED. NONE
OF THE COMPANY NOR ITS SHAREHOLDERS, DIRECTORS, OFFICERS, EMPLOYEES, ADVISORS
OR AFFILIATES, OR ANY REPRESENTATIVES OR AFFILIATES OF THE FOREGOING, ASSUMES
RESPONSIBILITY FOR THE ACCURACY OF THE PROJECTIONS PRESENTED HEREIN.
The information contained in this communication or document, including but not limited to forward-looking statements, applies only as of the date hereof and is not intended to give any assurances as to future results. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to such information, including any financial data or forward-looking statements, and will not publicly release any revisions it may make to the Information that may result from any change in the Company's expectations, any change in events, conditions or circumstances on which these forward-looking statements are based, or other events or circumstances arising after the date hereof.
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