REG - Yellow Cake PLC - Interim Financial Report
10/12/2024 07:00
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RNS Number : 4114P Yellow Cake PLC 10 December 2024
10 December 2024
Yellow Cake plc ("Yellow Cake", the "Company" or "Group")
Unaudited Consolidated Interim Financial Report for the six-month period ended
30 September 2024
Yellow Cake, a specialist Group operating in the uranium sector, holding
physical uranium for the long term and engaging in uranium-related commercial
activities, is pleased to announce its unaudited consolidated interim
financial report for the six-month period ended 30 September 2024
("half-year").
Highlights
· Increase in the Group's holdings of physical uranium
("U(3)O(8)") from 20.16 million lb of U(3)O(8) to 21.68 million lb of
U(3)O(8).
· Increase of 1.1% in the value of the Group's U(3)O(8) holdings from
USD1,753.5 million(( 1 )) as at 31 March 2024, to USD1,772.5 million 2 as
at 30 September 2024, as a result of an increase of 1.53 million lb of
U(3)O(8) received in June 2024, partly offset by a 6% decrease in the U(3)O(8)
spot price from USD87.00/lb(( 3 )) to USD81.75/lb(( 4 )).
· Decrease in net asset value from USD1,883.6 million 5 as at 31
March 2024 to USD1,796.0 million 6 as at 30 September 2024. Decrease in net
asset value per share from GBP6.88 per share (USD8.69 per share) 7 as at 31
March 2024 to GBP6.17 per share (USD8.28 per share) 8 as at 30 September
2024.
· Loss after tax for the half-year of USD87.6 million (30
September 2023: profit of USD458.8 million).
· On 3 June 2024, the Group took delivery of 1.53 million lb of
U(3)O(8) from JSC National Atomic Company Kazatomprom ("Kazatomprom") at
Orano's storage facility in France, in settlement of the Group's exercise of
its 2023 uranium purchase option under its agreement with Kazatomprom (the
"Framework Agreement"). Yellow Cake exercised the option in October 2023
agreeing to purchase 1.53 million lb of U(3)O(8) from Kazatomprom at a price
of USD65.50/lb, or USD100.0 million in aggregate. The purchase was funded by
way of an oversubscribed share placing in October 2023 which raised gross
proceeds of approximately GBP103 million (approximately USD125 million).
· All U(3)O(8) to which the Group has title and has paid for, is
held at the Cameco storage facility in Canada and the Orano storage facility
in France.
· The Group's net asset value on 6 December 2024 9 was GBP6.14 per
share or USD1,697.4 million, based on 21.69 million lb of U(3)O(8) valued at
a spot price of USD77.20/lb 10 and cash and other net current assets of
USD23.5 million as at 30 September 2024.
Group Estimated Net Asset Value as at 6 December 2024 (9)
Units
Uranium Holdings
Uranium oxide in concentrates ("U(3)O(8)") ((10)) (A) lb 21,682,318
U(3)O(8) fair value per pound ((11)) (B) USD/lb 77.20
U(3)O(8) fair value (A) x (B) = (C) USD m 1,673.9
Cash and other net current assets (() 11 ()) (D) USD m 23.5
Net asset value in USD m (C) + (D) = (E) USD m 1,697.4
Exchange Rate (F) USD/GBP 1.2742
Net asset value in GBP million (E) / (F) = (G) GBP m 1,332.1
Shares in issue less shares held in treasury(() 12 ()) (H) 216,856,447
Net asset value per share (G) / (H) GBP/share 6.14
Andre Liebenberg, CEO of Yellow Cake, said:
"We are seeing a standoff between producers seeking higher prices due to
rising costs and supply side strains, and buyers hesitant to commit, resulting
in a largely stable uranium price recently. Despite this, demand for uranium
is set to grow significantly, with the rapid growth in AI a particular driver.
Nuclear energy is increasingly recognised as a low-carbon, reliable energy
source, with global sentiment shifting in its favour. This is evident in
recent developments including China approving 11 new reactors, as well as
global ambitions to triple global nuclear capacity by 2050. Small modular
reactors are also advancing, offering shorter construction times and lower
costs, with robust government and investor backing. Meanwhile, uranium supply
faces challenges. Kazatomprom, for example, has cut its 2025 production
forecasts due to material shortages and development challenges, highlighting
broader supply constraints. These supply limitations and geopolitical
tensions, such as Russian export restrictions, suggest price volatility but
also present investment opportunities in physical uranium."
ENQUIRIES:
Yellow Cake plc
Andre Liebenberg, CEO Carole Whittall, CFO
Tel: +44 (0) 153 488 5200
Nominated Adviser and Joint Broker: Canaccord Genuity Limited
Henry Fitzgerald-O'Connor James Asensio
Charlie Hammond
Tel: +44 (0) 207 523 8000
Joint Broker: Berenberg
Matthew Armitt Jennifer Lee
Detlir Elezi
Tel: +44 (0) 203 207 7800
Financial Adviser: Bacchus Capital Advisers
Peter Bacchus Richard Allan
Tel: +44 (0) 203 848 1640
Communications Adviser: Sodali & Co
Peter Ogden
Tel: +44 (0) 7793 858 211
ABOUT YELLOW CAKE
Yellow Cake is a London-quoted company, headquartered in Jersey, which offers
exposure to the uranium spot price. This is achieved through its strategy of
buying and holding physical triuranium octoxide ("U(3)O(8)"). It may also seek
to add value through other uranium-related activities. Yellow Cake and its
wholly owned subsidiary (the "Group") seek to generate returns for
shareholders through the appreciation of the value of its holding of U(3)O(8)
and its other uranium-related activities in a rising uranium price
environment. The business is differentiated from its peers by its ten-year
Framework Agreement for the supply of U(3)O(8) with Kazatomprom, the world's
largest uranium producer. The Group currently holds 21.68 million pounds of
U(3)O(8), all of which is held in storage in Canada and France.
FORWARD LOOKING STATEMENTS
Certain statements contained herein are forward looking statements and are
based on current expectations, estimates and projections about the potential
returns of the Company and the industry and markets in which the Company will
operate, the Directors' beliefs and assumptions made by the Directors. Words
such as "expects", "anticipates", "should", "intends", "plans", "believes",
"seeks", "estimates", "projects", "pipeline", "aims", "may", "targets",
"would", "could" and variations of such words and similar expressions are
intended to identify such forward looking statements and expectations. These
statements are not guarantees of future performance or the ability to identify
and consummate investments and involve certain risks, uncertainties and
assumptions that are difficult to predict, qualify or quantify. Therefore,
actual outcomes and results may differ materially from what is expressed in
such forward looking statements or expectations. Among the factors that could
cause actual results to differ materially are: uranium price volatility,
difficulty in sourcing opportunities to buy or sell U(3)O(8), foreign exchange
rates, changes in political and economic conditions, competition from other
energy sources, nuclear accident, loss of key personnel or termination of the
services agreement with 308 Services Limited, changes in the legal or
regulatory environment, insolvency of counterparties to the Company's material
contracts or breach of such material contracts by such counterparties. These
forward-looking statements speak only as at the date of this announcement. The
Company expressly disclaims any obligation or undertaking to disseminate any
updates or revisions to any forward looking statements contained herein to
reflect any change in the Company's expectations with regard thereto or any
change in events, conditions or circumstances on which any such statements are
based unless required to do so by applicable law or the AIM Rules.
Chief Executive's Statement
The uranium market currently represents something of a standoff between
producers demanding prices more reflective of the complexities and increased
costs they face, and purchasers who seem reluctant to commit at current
levels. This led to the uranium price trading largely sideways in the six
months to 30 September 2024, despite production falling further behind
forecast demand.
Strong growth in electricity production will be required to meet increasing
demand from population growth, development, urbanisation, growth in heavy
industry and increased electrification. Emerging technologies such as electric
vehicles, AI and big tech data centres are also driving demand. Nuclear power
is now entrenched in the future energy mix as a viable source of secure,
low-carbon and reliable baseload energy production.
As a result, sentiment towards nuclear is continuing to shift positively in
many countries. This is evident in current commitments to build new nuclear
facilities as well as in extensions to reactor lifespans and uprating
facilities. Several countries are also advancing plans to restart previously
decommissioned reactors.
On the new build front, China approved the construction of 11 new reactors in
August with an investment of USD31 billion, and plans to add nuclear capacity
of approximately 90% of the current global reactor count by 2060, while Russia
is planning 37 new reactors by 2042. Small modular reactor ("SMR") designs are
advancing towards commercial operation with strong support from governments
and investors due to their shorter construction cycles, lower upfront capital
requirements and versatility.
While the plans currently underway to increase nuclear make a compelling
argument for strong growth in uranium demand, bringing new supply resources to
market is costly, complex and slow, while some of the largest uranium
suppliers are facing production issues. Kazatomprom, the world's largest
uranium producer, recently downgraded its production estimates for 2025 due to
sulfuric acid availability and construction delays. The reduction in
production targets of roughly 13-16 million pounds represents approximately
10% of 2023 global production. Kazatomprom also reported a significant
increase in production costs, including a substantial rise in the Mineral
Extraction Tax in Kazakhstan, adding further pressure to the supply side.
In this context of increasing demand and complexities in increasing supply, it
is perhaps surprising that the uranium spot price fell by 6% from 31 March
2024 to 30 September 2024 and medium-term uranium price indicators also
decreased, while the long-term price increased.
We expect to see some near term price volatility, but expect the supply-side
constraints to force a further correction at some stage. Recent comments by
Vladimir Putin threatening to restrict the sale of enriched uranium to the
west, highlight both the challenge and the opportunity for the uranium price.
We believe that the current market situation represents an excellent
opportunity to rebuild stakes in physical uranium.
Global Uranium Market
After ending March at USD87.00/lb, the uranium spot price rose to USD93.45
early in May before tracking down to trade between USD90/lb and USD80/lb for
most of the rest of the period, ending at USD81.75/lb on 30 September 2024 13
(#_ftn13) . Aggregate spot market volumes from April to September were 18 %
lower than the equivalent period in 2023 at 24.8 million lb of U(3)O(8)e 14 .
Two of the three longer‐term uranium price indicators weakened during the
period, with the 3‐year Forward Price declining to USD94.00/lb (March 2024:
USD97.00/lb) and the 5‐year Forward Price decreasing to USD101.00/lb (March
2024: USD108.00/lb). The Long‐Term Price rose by USD6.00/lb from the end of
March, reaching USD81.00/lb by the end of the six month period. This term
price indicator has risen by almost 20% since the end of 2023 when it was
reported at USD68/lb.
Nuclear Generation / Uranium Demand
On 13 May 2024, President Biden signed into law the Prohibiting Russian
Uranium Imports Act (H.R. 1042), which came into effect on 11 August 2024,
prohibiting the importation of Russian‐sourced uranium. The Secretary of
Energy, in consultation with the Secretaries of State and Commerce, may issue
a waiver if no alternative viable source of low‐enriched uranium is
available to sustain the continued operation of a nuclear reactor or a United
States nuclear energy company, or if the importation of low‐enriched uranium
is in the national interest. Any granted waivers shall terminate no later than
1 January 2028, when all Russian uranium importation will be banned through
until the end of 2040 15 .
In the US, Georgia Power announced commercial operation at the Vogtle‐4
reactor following the completion of Vogtle‐3 in July 2023. Construction of
the two Westinghouse AP‐1000 reactors began in 2013 but was beset with
numerous delays and cost overruns. Vogtle Units 1 and 2 have been in operation
since 1987 and 1989, respectively, and are currently licensed to operate for
60 years 16 .
Responding to rising electricity demand principally from data centres, John
Ketchum, CEO of NextEra Energy, owner of the Duane Arnold Energy Centre (600
Mwe) in Palo, Iowa, stated that the company might consider restarting the
plant which has been in decommissioning since 2020. Reportedly, Google is
evaluating the development of a USD576 million data centre in Cedar Rapids,
Iowa, approximately 20 miles from the nuclear reactor 17 .
Constellation Energy will restart the 835 MWe Three Mile Island Unit 1 reactor
after a five-year shutdown. The company has reached a 20-year power off-take
agreement to supply electricity to Microsoft in support of the company's
planned hyperscale data centre development. Operating as the Crane Clean
Energy Center, the reactor is expected to re-enter commercial service in 2028
after refurbishment. Constellation plans to apply for an operating license
that would allow the plant to operate until at least 2054 18 .
Oracle announced plans to develop a hyperscale data centre incorporating three
SMRs. While the location and schedule for the data centre were not disclosed,
the data centre would be "north of a gigawatt" and already has building
permits for the associated SMRs 19 .
After the period-end, Google announced an agreement with Kairos Power for the
development, construction and operation of a series of advanced SMRs and for
the supply of energy, ancillary services and environmental attributes to
Google data centres. 20 Amazon announced that they had signed three new
agreements to support the development of nuclear energy projects, including
the construction of several new SMRs, with companies across Washington,
Virginia and Pennsylvania. 21
The US Department of Energy released the results of a recent analysis
concluding that 60 to 95 GWe of new nuclear generating capacity could be sited
at existing and recently retired nuclear power plant sites. The report
evaluated all 54 operating and 11 recently retired nuclear power plant sites
in 31 states. Early indications suggest that 41 operating and retired nuclear
power plant sites have sufficient room to host one or more large light-water
reactors totalling 60 GW of new capacity, increasing to 95 GW if sites
included SMRs 22 .
The Philippines Department of Energy is reportedly evaluating the development
of up to 2,400 MW of SMR capacity to supplement its electricity generation by
2032. Energy Assistant Secretary, Mario Marasigan, stated that SMR technology
"would provide enhanced safety features, scalability and efficient waste
management." The country's initial venture into nuclear power with the Bataan
Nuclear Power Plant was terminated in 1986 subsequent to the Chernobyl nuclear
accident 23 .
On 4 June 2024, the Japanese Cabinet approved the FY23 Annual Report on Energy
(known as the Energy White Paper 2024), which covers the period from April
2023 to March 2024. Subsequently, the report was submitted to the Diet for
review and approval. The report advises that the near‐term (2020‐2030)
level of annual electricity demand of 1,000 TWh is forecast to increase to
1,350‐1,500 TWh by 2050, driven by data centres and semiconductor
plants 24 . Furthermore, the country's Strategic Energy Plan, which will be
revised this year, is expected to incorporate a nuclear power policy that
would allow utilities to build new reactors to replace units that are
decommissioned/ dismantled 25 .
Tokyo Electric Power Company initiated fuel loading at its Kashiwazaki Unit 7
on 15 April following approval from Japan's Nuclear Regulation Authority
("NRA"). Subsequent to fuel loading, the facility will undergo a series of
safety inspections before regulatory approval for reactor restart. The
Kashiwazaki‐Kariwa nuclear power plant ("NPP") consists of seven boiling
water‐type reactors with a total gross electrical capacity of 8,212 Mwe. It
has been offline since 2012 following the Fukushima Daiichi accident in 2011.
Japan has 12 operating reactors following the restart of the Takahama‐2 unit
in September 2023 26 .
In May 2024, the NRA approved twenty‐year operating licence extensions for
Kansai Electric Power Company's Takahama 3 and 4 reactors (2 x 830 Mwe).
Previously, Kansai's Takahama 1 and 2 (2 x 780 Mwe) were the first two
reactors in Japan to receive operating licence extensions beyond 40 years 27 .
Swedish utility, Vattenfall, announced that the company has decided to pursue
operating lifetime extensions for the Forsmark and Ringhals NPPs, which would
allow the units to operate for 80 years compared to the current 60 years.
Vattenfall intends to invest an estimated USD4‐5 billion to replace or
renovate systems and components 28 .
South Korea's draft 11th Basic Electricity Supply and Demand Plan forecasts
the country's demand for electricity increasing to 129.3 GW by 2028, an
increase of 30% from 2023, driven mainly by growing demand from the
semiconductor and data centre industries. The draft plan envisions
carbon‐free energy sources in the energy mix increasing from about 40% in
2023 up to 70% by 2028. The nuclear power component would rise from the
expected 2030 level of 31.8% up to 35.6% in 2038. One scenario incorporates
the construction of three AP‐1400 reactors supplemented by 0.7 GW allocated
for the commercialisation demonstration of SMRs currently under
development 29 .
South Korea and the Republic of Kazakhstan executed a memorandum of
understanding on critical minerals supply chains, which will allow South
Korean companies to participate in the exploration for a spectrum of minerals,
including uranium, within the Central Asian republics. South Korea is pursuing
expanded sources of critical minerals, including uranium, in support of their
increasing electricity demand 30 .
South Korea's Nuclear Safety and Security Commission has issued construction
licenses for Korea Hydro & Nuclear Power for the development of Units 3
and 4 of the Shin Hanul Nuclear Power Plant. The APR1400 reactors had
previously been scheduled to enter commercial operation by 2022 and 2023, but
construction was halted under the previous President's nuclear phase-out
policy. The two units are now scheduled for operations commencing in 2032 and
2033 31 .
Taiwan Power Company announced the pending closure of the Maanshan Unit 1
reactor effective 27 July 2024. The government plans to replace the generation
capacity lost with energy from thermal power plants and renewable sources.
Previously, under the government's nuclear phase‐out policy, Taiwan shut
down Chinshan 1 and 2 as well as Kuosheng 1 and 2. The operating licence for
Maanshan Unit 2 expires in May 2025 32 . Citing the need to supply stable
electricity to Taiwan's expanding artificial intelligence sector, Taiwan's
National Development Council stated that the council would not reject nuclear
energy generation as long as there is government consensus in support of
nuclear power 33 .
Russia's ROSATOM announced an agreement to construct a small NPP in
Uzbekistan. The project, to be located in the Jizzakh region of the Central
Asian republics, will incorporate the RITM‐200N reactor technology which
Russia has adapted from reactors used by their icebreaker fleet. The
land‐based version has an electrical power capacity of 55 MW and an expected
operating life of 60 years 34 .
In a recent meeting between Alexei Likachev, the Director General of ROSATOM,
and Bangladesh Prime Minister, Sheikh Hasina, the topic of SMRs was tabled.
Likachev visited Bangladesh to inspect the Russian‐built Rooppur Unit 1
(VVER‐1200) which is planned to enter commercial operation later in 2024, to
be followed by Rooppur‐2 in 2026 35 .
Norwegian power company, Norsk Kjernekraft, announced plans to construct SMRs
to provide "off‐grid" power for data centres and other industrial users. The
SMRs would be deployed on‐site at data centres and offer dedicated power for
individual facilities or regions. Norway's current power plants produced 156
TWh in 2023, however forecasts of future power needs vary from an additional
50 TWh up to as much as 233 TWh 36 .
Italy has initiated an evaluation of reintroducing nuclear power. Previously,
the country operated four commercial reactors totalling 1,423 GWe, but a
national referendum following the 1986 Chernobyl nuclear accident resulted in
a total nuclear phase-out, with the last two operating reactors, Caorso and
Trino Vercellese, closing in 1990. Italy's National Integrated Energy and
Climate Plan, submitted to the European Commission in early July, sets out
potential nuclear power goals ranging from 11% of generating capacity up to as
much as 20-22% (16 GWe) of total capacity by 2050 37 .
China reported a record level of nuclear generation in 2023 as NPPs provided
440,000 GWh of output. The China Atomic Energy Authority reported 55
operational NPPs and 36 approved or under construction on the Chinese mainland
at the end of 2023, with a total installed capacity of 57 GWe and 44 GWe,
respectively 38 .
In August 2024, China's State Council approved the construction of 11 nuclear
reactors across five sites located in Jiangsu, Shandong, Guangdong, Zhejiang,
and Guangxi. The estimated total investment in the 11 reactors amounts to 220
billion yuan (USD31 billion), with construction times expected to be five
years. China General Nuclear Power Corporation received approvals for six
reactors, China National Nuclear for three reactors, and State Power
Investment Corporation for the remaining two units. The State Council has
approved a total of 31 reactors over the period 2022-2024 and is expected to
approve ten reactors per year over the next three to five years 39 .
Reuters reported that the United Arab Emirates/Emirates Nuclear Power
Corporation is planning to construct a second NPP following the recent
completion of the Barakah NPP, which comprises four Korean‐built APR‐1400
reactors. The associated tender could be distributed sometime this year with
the target date for commercial operations being as early as 2032 40 .
Indonesia's Energy and Mineral Resources Ministry reports that nuclear power
has been included in the country's 2033 National Electricity General Plan. The
Ministry's Director General of New Renewable Energy and Energy Conservation,
Eniya Listiani Dewi, stated in a panel discussion that nuclear power can be
implemented in 2033. A proposed new government bureau, the Nuclear Energy
Program Implementation Organization, would oversee the development of nuclear
power in Indonesia 41 .
Eastern European countries plan to develop at least twelve nuclear reactors
with a total budget of approximately €130 billion. The principal objectives
of these programmes are to achieve carbon neutrality and reduce dependence on
Russian gas imports 42 .
The government of South Africa intends to progress its proposed expansion of
commercial nuclear power. The country's Minister of Energy and Electricity,
Kgosientsho Ramokgopa, plans to pursue approvals for funding to construct
2,500 MW of nuclear capacity, likely to be located at the proposed Thyspunt
site in the Eastern Cape's Nelson Mandela Bay hub 43 . Separately, government
approval has been granted for a 20-year operating life extension for Unit 1 of
South Africa's two-reactor nuclear power plant, Koeberg. The South African
utility, ESKOM, applied for the extension of the initial 40-year license in
2021 44 .
The Russian Federation published a draft planning document outlining the
country's nuclear power expansion plan to 2042. Designed to support the
government's plan for nuclear power to provide 25% of the country's
electricity by 2045, Rosatom's General Director, Alexei Likhachev, stated that
the new general scheme provides for the construction of 28 GW of new nuclear
generating capacity by 2042, consisting of 37 new reactors, including
replacement reactors at several current sites and 11 new nuclear power
plants 45 .
A group of the world's largest banks announced their support for expanding
commercial nuclear power. During New York Climate Week, the group, which
includes 14 major banks such as Barclays, Bank of America, Citi, Morgan
Stanley, BNP Paribas, Goldman Sachs and Société Générale, stated that they
would endeavour to provide capital resources to the industry in response to
the COP28 declaration to triple global nuclear power by 2050 to meet net zero
carbon goals 46 .
The International Atomic Energy Agency ("IAEA") released the 44th edition of
its annual forecast of installed nuclear generating capacity, examining two
scenarios: a low case and a high case. At the end of 2023, there were 413
nuclear power reactors in operation totalling 371.5 GWe, with 59 reactors
(61.1 GWe) under construction. During 2023, five new nuclear reactors (5 GWe)
were connected to the grid, while five reactors (6 GWe) were retired. The high
case scenario envisions current global commercial nuclear power capacity of
372 GWe increasing by 2.5 times, reaching 950 GWe by 2050. IAEA Director
General Rafael Mariano Grossi stated that the new IAEA projections reflect
increasing acknowledgment of nuclear power as a clean and secure energy
supply, as well as increasing interest in SMRs to meet climate goals and
foster sustainable development 47 .
Uranium / Nuclear Fuel Supply
Cameco reported second-quarter 2024 results showing increased production,
rising from 8.8 million pounds during the first six months of 2023 to 12.9
million pounds year-on-year as McArthur River continued ramp-up. The company
reported that while forecast total uranium deliveries in 2024 remained at
32-34 million pounds, additional term contract commitments during the quarter
now show an annual average of about 29 million pounds during the 2024-2028
period, up from the 28 million pounds per year reported as of the end of the
March quarter 48 .
Kazatomprom announced that the Mineral Extraction Tax ("MET") rate applicable
to uranium production had been modified by the national government. The tax
base for MET on uranium is determined by the weighted average price for
uranium from public price reporting sources for the corresponding reporting
period, multiplied by the amount of uranium mined and a MET rate of 6%. Under
the modified tax regime, the 2025 MET rate will increase to 9% for that year.
However, commencing in 2026, uranium production will be taxed on a sliding
scale, taking into account the annual production volume at a specific
production facility, with rates up to 18% for facilities producing up to and
including 10.4 million pounds, and an additional tax applied, based on the
weighted average U(3)O(8) price, of up to 2.5% if the price exceeds
USD110/lb 49 .
Kazatomprom released its second-quarter 2024 operations and trading update in
August, reporting total uranium production of 28.3 million pounds, a 5%
increase compared to the first six months of 2023. The company secured
sufficient sulfuric acid to meet aggregate production at the minus 20% level
relative to Subsoil Use Agreements. Production guidance for 2024 was adjusted
upwards from 54.6-57.2 million pounds to 58.5-61.1 million pounds. The world's
largest uranium producer stated that the production increase would be used to
replenish uranium inventories 50 (#_ftn50) . Production costs rose
significantly during the first half of 2024 compared to the same period of
2023 due to the increase in the Mineral Extraction Tax coupled with the cost
of sulfuric acid. All-in sustaining cash cost (attributable C1 + capital cost)
rose by 45% year-over-year, reported at USD28.06/lb for the first six months
of 2024 51 .
Kazatomprom announced that 2025 production would fall well short of previous
guidance as sulfuric acid availability and construction schedules lagged.
Meirzhan Yussupov, CEO, stated that amid continued success in long-term
contracting activity, Kazatomprom had initially intended to ramp up its 2025
production to 100% of Subsoil Use Agreement levels. However, uncertainty
around sulfuric acid supplies for 2025 needs and delays in construction works
at newly developed deposits resulted in a need to re-evaluate 2025 plans.
Total Kazakh uranium production for 2025 has been reset at 65.0-68.9 million
pounds compared to the previous guidance of 79.3-81.9 million pounds(51).
The government of the Republic of Niger, installed subsequent to the July 2023
coup d'état, has withdrawn the mining permits for both the Imouraren Mining
Project (majority‐owned by Orano) and the proposed Madaouela Mining Project
(majority‐owned by GoviEx Uranium Inc.). The government stated that the
rights to the proposed uranium mines now reside in the "public domain" 52 (,
53 ).
After the period end, the Russian Federation issued a decree limiting export
of LEU to the US, with effect from 15 November 2024, with exports requiring a
one-time license by Russia's Federal Service for Technical and Export Control.
Enriched Uranium Product shipments from Russia to the US must now receive both
a license in Russia (decided on an individual delivery basis) as well as a
waiver from the US Department of Energy 54 .
Market Outlook
Global uranium spot market activity appears to be rising as financial
entities, trading companies, nuclear utilities, and possibly uranium
production companies enter the near-term market to secure material as prices
firm. Total transactional volume for 2024 may reach or slightly exceed 50
million pounds, which would generally reflect the 2023 level. As uranium
production in Kazakhstan continues to face a spectrum of challenges including
sulfuric acid availability, upward cost pressure, and transportation-related
hurdles, Kazatomprom has signalled that further downgrading of production
guidance for 2025 may occur, which could impact spot market purchasing
activity during the fourth quarter. Utility term contracting remains subdued,
especially in the United States, as utilities pursue waivers under the
recently-enacted Russian nuclear fuel ban legislation while the term uranium
price continues to strengthen. Increasing commitments for deliveries in the
long term (post 2026/2027) may be expected, especially as utilities assess the
potential market impacts of the hyperscale data centre developers.
Andre Liebenberg
Chief Executive Officer
Chief Financial Officer's Report
Highlights
• Increase in the Group's uranium holdings from 20.16 million lb
of U(3)O(8) to 21.68 million lb of U(3)O(8).
• Increase in the value of the Group's uranium holdings by 1.1%
from USD1,753 million(( 55 )) to USD1,772.5 million 56 , as a result of an
increase in uranium held, partly offset by a decrease in the U(3)O(8) spot
price.
• Loss after tax of USD87.6 million (30 September 2023: profit of
USD458.8 million).
Uranium purchase
The Group began the period with a holding of 20.16 million lb of U(3)O(8)(.)
On 3 June 2024, the Group took delivery of 1,526,717 lb of U(3)O(8) that it
had elected to purchase as part of its 2023 uranium purchase option under its
Framework Agreement with JSC National Atomic Company Kazatomprom at a price of
USD65.50/lb, or USD100.0 million in aggregate. The delivery was made at the
Cameco storage facility in Ontario, Canada. The purchase was funded by an
oversubscribed share placing on 2 October 2023 which raised gross proceeds of
approximately GBP103 million (approximately USD125 million). Following
receipt, the Group holds 21.68 million lb of U(3)O(8).
Uranium-related losses and gains
The Group made a total uranium loss of USD81.0 million in the half-year to 30
September 2024 (30 September 2023: gain USD462.9 million).
Operating performance
• The Group delivered a loss after tax for the half-year of USD87.6
million (30 September 2023: profit of USD458.8 million).
• Expenses for the half-year were USD8.3 million (September 2023:
USD5.8 million) and comprised:
o USD0.8 million in commissions payable to 308 Services Limited in relation to
the purchase by the Group of U(3)O(8) (30 September 2023: USD0.7 million); and
o USD7.5 million in expenses of a recurring nature (30 September 2023: USD5.1
million) comprising the following):
§ Procurement and market consultancy fees (holding fees and storage incentive
fees) paid to 308 Services Limited of USD2.5 million (30 September 2023:
USD1.5 million), with the year-on-year increase in fees resulting from the
increase in the underlying value of uranium held (detailed in note 8); and
§ Storage and other expenses of USD5.0 million (30 September 2023: USD3.6
million).
The Group's Management Expense Ratio for the half-year (total operating
expenses of a recurring nature, excluding commissions and equity offering
expenses, expressed as an annualised percentage of average daily net asset
value during the period) was 0.80% (30 September 2023: 0.88%).
Statement of financial position and cash flow
The value of the Group's investment in U(3)O(8) increased by 1.1% during the
half-year from USD1,753.5 million as at 31 March 2024 to USD1,772.5 million
as at 30 September 2024, as a result of the increase in the volume of uranium
held from 20.16 million lb of U(3)O(8) to 21.68 million lb of U(3)O(8),
which offset the decrease in the uranium price from USD87.00/lb(( 57 )) to
USD81.75/lb(( 58 )).
As at 30 September 2024, the Group had cash and cash equivalents of
USD26.5 million (31 March 2024 USD133.6 million).
The Company does not propose to declare a dividend for the period.
Net Asset Value
Net asset value during the half-year decreased from USD1,883.6 million or
GBP6.88 per share 59 as at 31 March 2024 to USD1,796.0 million or GBP6.17 per
share 60 as at 30 September 2024. The Group's net asset value on
30 September 2024, comprised 21.68 million lb of U(3)O(8), valued at a spot
price of USD81.75/lb 61 and cash and other net current assets of USD23.5
million 62 (31 March 2024: comprised 20.16 million lb of U(3)O(8), valued at
a spot price of USD87.00/lb 63 and cash and net current assets of USD130.1
million 64 ).
The Group's Net Asset Value
Units 30 September 31 March
2024
2024
Uranium Holdings
Uranium oxide in concentrates ("U(3)O(8)") (A) lb 21,682,318 20,155,601
U(3)O(8) fair value per pound (B) USD/lb 81.75 87.00
U(3)O(8) fair value (A) x (B) = (C) USD m 1,772.5 1,753.5
Cash and other net current assets (D) USD m 23.5 130.1
Net asset value in USD m (C) + (D) = (E) USD m 1,796.0 1,883.6
Exchange Rate (( 65 )) (F) USD/GBP 1.3413 1.2632
Net asset value in GBP million (E) / (F) = (G) GBP m 1,339.0 1,491.1
Shares in issue less shares held in treasury (H) 216,856,447 216,856,447
Net asset value per share (G) / (H) GBP/share 6.17 6.88
Carole Whittall
Chief Financial Officer
Independent Review Report to Yellow Cake Plc
Conclusion
We have been engaged by Yellow Cake plc ('the Group') to review the
consolidated financial statements of the Group in the interim financial report
for the six months ended 30 September 2024 which comprise the Consolidated
Statement of Financial Position, Consolidated Statement of Comprehensive
Income, Consolidated Statement of Changes in Equity, Consolidated Statement of
Cash Flows and the associated explanatory notes. We have read the other
information contained in the interim financial report and considered whether
it contains any apparent material misstatements of fact or material
inconsistencies with the information in the consolidated financial statements.
Based on our review, nothing has come to our attention that causes us to
believe that the consolidated financial statements in the interim financial
report for the six months ended 30 September 2024 is not prepared, in all
material respects, in accordance with International Accounting Standard 34,
"Interim Financial Reporting" as contained in UK-adopted International
Accounting Standards, and the AIM Rules for Companies.
Basis for Conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" ('ISRE (UK) 2410') issued for use in
the United Kingdom. A review of interim financial information consists of
making enquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review procedures. A
review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and consequently does not enable
us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an audit
opinion.
As disclosed in note 2, the annual financial statements of the Group are
prepared in accordance with UK-adopted International Accounting Standards.
The consolidated financial statements included in this interim financial
report has been prepared in accordance with International Accounting Standard
34, "Interim Financial Reporting" as contained in UK-adopted International
Accounting Standards.
Conclusions Relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for Conclusion section of this report,
nothing has come to our attention to suggest that management have
inappropriately adopted the going concern basis of accounting or that
management have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410, however future events or conditions may cause the group to
cease to continue as a going concern.
Responsibilities of Directors
The interim financial report, is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the interim
financial report in accordance with International Accounting Standard 34,
"Interim Financial Reporting" as contained in UK-adopted International
Accounting Standards and the AIM Rules for Companies.
In preparing the interim financial report, the directors are responsible for
assessing the Group's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the Group or to
cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the Review of the Financial Information
In reviewing the interim financial report, we are responsible for expressing
to the Group a conclusion on the consolidated set of financial statements in
the interim financial report. Our conclusions, including our Conclusions
Relating to Going Concern, are based on procedures that are less extensive
than audit procedures, as described in the Basis for Conclusion paragraph of
this report.
Use of our report
This report is made solely to the Group in accordance with International
Standard on Review Engagements (UK) 2410 "Review of Interim Financial
Information performed by the Independent Auditor of the Entity". Our review
work has been undertaken so that we might state to the Group those matters we
are required to state to them in an independent review report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Group, for our review work, for this
report, or for the conclusions we have formed.
RSM UK Audit LLP
Chartered Accountants
25 Farringdon Street
London
EC4A 4AB
Date: 9 December 2024
Consolidated Statement of Financial Position
As at As at
30 September 2024 31 March 2024
(unaudited) (audited)
Notes USD '000 USD '000
ASSETS:
Non-current assets
Uranium holdings 3 1,772,529 1,753,537
Total non-current assets 1,772,529 1,753,537
Current assets
Receivables 443 432
Cash and cash equivalents 4 26,493 133,189
Total current assets 26,936 133,621
1,799,465 1,887,158
Total assets
LIABILITIES:
Current liabilities
Trade and other payables (3,452) (3,544)
Total current liabilities (3,452) (3,544)
Total liabilities (3,452) (3,544)
NET ASSETS 1,796,013 1,883,614
Equity
Attributable to the equity owners of the Group
Share capital 5 2,951 2,951
Share premium 5 781,233 781,233
Share-based payment reserve 6 121 107
Treasury shares 7 (14,061) (14,061)
Retained earnings 1,025,769 1,113,384
TOTAL EQUITY 1,796,013 1,883,614
Consolidated Statement of Comprehensive Income
1 April 2024 1 April 2023
To To
30 September 2024 30 September 2023
(unaudited) (unaudited)
Notes USD '000 USD '000
Uranium holding (losses)/gains
Fair value movement of uranium holdings 3 (81,008) 462,918
Total uranium (losses)/gains (81,008) 462,918
Expenses
Share-based payments 6 (14) (14)
Commission on uranium transactions 8 (750) (660)
Procurement and market consultancy fees 8 (2,477) (1,469)
Storage and other operating expenses (5,000) (3,582)
Total expenses (8,241) (5,725)
Bank interest income 1,628 1,637
Gain/(loss) on foreign exchange 6 (6)
(87,615) 458,824
(Loss)/profit before tax attributable to the equity owners of the Group
Tax expense - -
Total comprehensive (loss)/profit for the period after tax attributable to the (87,615) 458,824
equity owners of the Group
Basic (loss)/earnings per share attributable to the equity owners of the Group 10 (0.40) 2.32
(USD)
Diluted (loss)/earnings per share attributable to the equity owners of the 10 (0.40) 2.31
Group (USD)
Consolidated Statement of Changes in Equity
Attributable to the equity owners of the Group
Share
capital
Total
equity
Share premium Share Treasury Retained
based
Shares
earnings
payment
reserve
Notes USD '000 USD '000 USD '000 USD '000 USD '000 USD '000
As at 31 March 2023 (audited) 2,724 660,203 166 (14,216) 386,449 1,035,326
Total comprehensive income after tax for the period - - - - 458,824 458,824
Transactions with owners:
Share-based payments 6 - - 14 - - 14
Exercise of incentive options 7 - - (84) 155 (71) -
As at 30 September 2023 (unaudited) 2,724 660,203 96 (14,061) 845,202 1,494,164
Total comprehensive income after tax for the period - - - - 268,182 268,182
Transactions with owners:
Shares issued 227 124,448 - - - 124,675
Share issue costs (3,418) - - - (3,418)
Share-based payments 6 - - 11 - - 11
As at 31 March 2024 (audited) 2,951 781,233 107 (14,061) 1,113,384 1,883,614
Total comprehensive loss after tax for the period - - - - (87,615) (87,615)
Transactions with owners:
Share-based payments 6 - - 14 - - 14
As at 30 September 2024 (unaudited) 2,951 781,233 121 (14,061) 1,025,769 1,796,013
Consolidated Statement of Cash Flows
1 April 2024 1 April 2023
To To
30 September 2024 30 September 2023
(unaudited) (unaudited)
Notes USD '000 USD '000
Cash flows from operating activities
(Loss)/Profit after tax for the financial period (87,615) 458,824
Adjustments for:
Change in fair value of uranium holdings 3 81,008 (462,918)
Share-based payments 6 14 14
(Gain)/loss on foreign exchange (6) 6
Interest income (1,628) (1,637)
Operating cash outflows before changes in working capital (8,227) (5,711)
Changes in working capital:
(Increase)/Decrease in trade and other receivables (11) 178
(Decrease)/Increase in trade and other payables (104) 68,906
Cash (used in)/generated from operating activities including changes in (115) 63,373
working capital
Interest received 1,628 1,637
Cash (used in)/generated from operating activities (6,714) 65,010
Cash flows from investing activities
Purchase of uranium 3 (100,000) (66,015)
Net cash used in investing activities (100,000) (66,015)
Cash flows from financing activities
Net cash generated from financing activities - -
Net decrease in cash and cash equivalents during the period (106,714) (1,005)
Cash and cash equivalents at the beginning of the period 133,189 84,428
Effect of exchange rate changes 18 (22)
Cash and cash equivalents at the end of the period 26,493 83,401
Notes to the Consolidated Interim Financial Statements
For the period from 1 April 2024 to 30 September 2024
1. General information
Yellow Cake plc (the "Company") was incorporated in Jersey, Channel Islands on
18 January 2018. The Company is the holding company of YCA Commercial Ltd
("YCA Commercial") which was incorporated on 26 September 2023 in Jersey,
Channel Islands (together the "Group"). YCA Commercial is wholly owned by the
Company. The address of the registered office of the Group is 3rd Floor,
Gaspé House, 66-72 Esplanade, St. Helier, Jersey, JE1 2LH.
The Group operates in the uranium sector and was established to purchase and
hold U(3)O(8) and to add value through other uranium-related activities. The
strategy of the Group is to acquire long-term holdings of U(3)O(8) and not to
actively speculate with regards to short-term changes in the price of
U(3)O(8). The Group engages in uranium-related commercial activities such as
location swaps and may enter into uranium lending transactions.
The Company was admitted to list on the London Stock Exchange AIM market
("AIM") on 5 July 2018. On 22 June 2022, the Company's shares were admitted to
trading on the OTCQX, the highest tier of the US over-the-counter market.
2. Summary of significant accounting policies
Basis of preparation
The unaudited consolidated interim financial statements for the six months
ended 30 September 2024 have been prepared in accordance with International
Accounting Standard 34 "Interim Financial Reporting." This report should be
read in conjunction with the Group's annual financial statements for the
period ended 31 March 2024, available on the Company's website
(www.yellowcakeplc.com), which were prepared in accordance with UK-adopted
International Financial Reporting Standards ("IFRS"). The audited financial
information for the year ended 31 March 2024 is based on the statutory
accounts for the financial year ended 31 March 2024. The auditors reported on
those accounts: their report was unqualified and did not contain statements
where the auditor is required to report by exception.
The accounting policies adopted and methods of computation followed in the
consolidated interim financial statements are consistent with those applied in
the preparation of the consolidated annual financial statements for the year
ended 31 March 2024 and are expected to be applied to the consolidated annual
financial statements for the year ending 31 March 2025.
The unaudited consolidated interim financial statements do not constitute
statutory accounts within the meaning of Section 105 of the Companies (Jersey)
Law 1991.
New and revised standards
At the date of authorisation of these financial statements there were
standards and amendments which were in issue but not yet effective and which
have not been applied. The principal ones were:
· Amendments to IFRS 9: Financial Instruments (Effective 1 January
2026);
· Amendments to IFRS 7: Financial instruments - Disclosures
(Effective 1 January 2026);
· Amendments to IAS 21: Accounting where there is a lack of
exchangeability (effective 1 January 2025); and
· IFRS 18: Presentation and Disclosure in Financial Statements
(effective 1 January 2027 - subject to endorsement by the UKEB).
The Directors do not expect the adoption of these standards and amendments to
have a material impact on the financial statements.
The principal accounting policies adopted are set out below.
Going concern
The Directors, having considered the Group's objectives and available
resources along with its projected income and expenditure for at least twelve
months from the date of approval of the consolidated interim financial
statements, are satisfied that the Group has adequate resources to continue in
operational existence for the foreseeable future. Accordingly, the Directors
have adopted the going concern basis in preparing these consolidated interim
financial statements.
The Board continues to monitor the ongoing impact of the Ukraine/Russian
Conflict and sanctions relating to this conflict which could impact the
uranium industry and the world economy.
The Group considered that, as at 30 September 2024, it had sufficient working
capital to meet approximately 18 months of operating expenses before it would
need to raise additional funds. The Group has no debt or hedge liabilities on
its balance sheet. In the absence of other sources of capital, the Group can
reasonably be expected to realise a portion of its uranium holdings to raise
working capital if required.
Consolidation
The consolidated financial statements are prepared by combining the financial
statements of the Company and its subsidiaries. Subsidiaries are all entities
over which the parent company has control, as defined in IFRS 10 "Consolidated
financial statements". Subsidiaries are fully consolidated from the date on
which control is transferred to the parent company. They are de-consolidated
from the date that control ceases.
Uranium holdings
Acquisitions of U(3)O(8) are initially recorded at cost and are recognised in
the Consolidated statement of financial position on the date the risks and
rewards of ownership pass to the Group, which is the date that the legal title
to the uranium passes.
After initial recognition, U(3)O(8) holdings are measured at fair value based
on the daily spot price for U(3)O(8) published by UxC LLC.
IFRS lacks specific guidance in respect of accounting for uranium holdings. As
such the Directors of the Group have considered the requirements of
International Accounting Standard 1 "Presentation of Financial Statements" and
International Accounting Standard 8 "Accounting Policies, Changes in
Accounting Estimates and Errors" to develop and apply an accounting policy.
The Directors of the Group consider that measuring the U(3)O(8) holdings at
fair value provides information that is most relevant to the economic decision
making of users. This is consistent with International Accounting Standard 40
Investment Property, which allows for assets held for long-term capital
appreciation to be presented at fair value.
Critical accounting judgements and estimation uncertainty
The preparation of the consolidated financial statements requires management
to make judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets, liabilities, income
and expenses.
Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances. Revisions to accounting
estimates are recognised in the period in which the estimate is revised and in
any future periods affected.
The resulting accounting estimates will, by definition, seldom equate to the
related actual results.
Accounting estimates
In preparing these unaudited consolidated interim financial statements the
Directors have not made any significant accounting estimates.
Judgements
Taxation
The Group receives regular tax advice and opinions from its advisors and
accountants to ensure it is aware of, and can seek to mitigate the effects on
its tax position of, changes in regulation. While the Group stores its uranium
in storage facilities in Canada and France, the Group does not carry on
business in either of these jurisdictions. The directors have considered the
tax implications of the Group's operations and have reached judgement that no
tax liability has arisen during the period (year ended 31 March 2024: USD
nil).
Uranium Holdings
As set out under the accounting policy for uranium holdings above, the Group
measures its holdings in U(3)O(8) at fair value.
Kazatomprom Framework Agreement
Under the terms of its Framework Agreement with Kazatomprom, the Group has an
annual purchase option which entitles it to contract for up to USD100 million
of U3O8 each calendar year at the U3O8 spot price prevailing at the date that
the Group binds itself to make the purchase. The purchase is accounted for on
delivery of the U(3)O(8) at the storage facility, which may be in a subsequent
accounting period. The Group has determined that the terms of this arrangement
do not fall within the scope of IFRS 9.
3. Uranium holdings
Fair value
USD '000
As at 31 March 2023 (audited) 952,504
Acquisition of U(3)O(8) 66,015
Change in fair value 462,918
As at 30 September 2023 (unaudited) 1,481,437
Change in fair value 272,100
As at 31 March 2024 (audited) 1,753,537
Acquisition of U(3)O(8) 100,000
Change in fair value (81,008)
As at 30 September 2024 (unaudited) 1,772,529
The value of the Group's holdings of U(3)O(8) is based on the daily spot price
for U(3)O(8) of USD81.75/lb as published by UxC LLC on 30 September 2024 (31
March 2024: USD87.00/lb).
As at 30 September 2024, the Group:
· has since inception, purchased a total of 24,353,232 lb of
U(3)O(8) at an average cost of USD33.14/lb;
· has since inception, disposed of 2,670,914 lb of U(3)O(8) at an
average selling price of USD40.23/lb that had been acquired at an average
price of USD21.01/lb, assuming a first in first out methodology; and
· held a total of 21,682,318 lb of U(3)O(8) at an average cost of
USD34.64/lb for a net total cash consideration of USD751.1 million, assuming a
first in first out methodology.
Acquisition of uranium
On 3 June 2024, the Group took title to 1,526,717 lb of U(3)O(8,) acquired as
part of its 2023 uranium purchase option under its Framework Agreement with
Kazatomprom, at a price of USD65.50/lb for a total consideration of
USD100 million.
The following table provides a summary of the Group's U(3)O(8) holdings as at
30 September 2024:
Quantity Fair Value
Location lb USD '000
Canada 19,885,601 1,623,195
France 1,826,717 149,334
Total 21,682,318 1,772,529
As at 31 March 2024:
Quantity Fair Value
Location lb USD '000
Canada 19,855,601 1,727,437
France 300,000 26,100
Total 20,155,601 1,753,537
4. Cash and cash equivalents
Cash and cash equivalents as at 30 September 2024 were banked with Citi Bank
Europe plc in a variable interest account with full access. Balances at the
end of the period were USD25,929,768 and GBP420,041, a total of USD26,493,170
equivalent (31 March 2024: USD133,188,698 equivalent).
5. Share capital
Authorised:
10,000,000,000 ordinary shares of GBP0.01
Issued and fully paid:
Ordinary shares
Number GBP '000 USD '000
Share capital as at 31 March 2023 (audited) 202,740,730 2,027 2,724
Share capital as at 30 September 2023 (unaudited) 202,740,730 2,027 2,724
Issued 2 October 2023 18,700,000 187 227
Share capital as at 31 March 2024 (audited) 221,440,730 2,214 2,951
Share capital as at 30 September 2024 (unaudited) 221,440,730 2,214 2,951
The number of shares in issue above includes 4,584,283 treasury shares - refer
to note 7.
Share
premium
GBP '000 USD '000
Share premium as at 31 March 2023 (audited) 492,700 660,203
Share premium as at 30 September 2023 (unaudited) 492,700 660,203
Proceeds of issue of shares 102,663 124,448
Share issue costs (2,812) (3,418)
Share premium as at 31 March 2024 (audited) 592,551 781,233
Share premium as at 30 September 2024 (unaudited) 592,551 781,233
The Company has one class of shares which carry no right to fixed income.
6. Share-based payments
The Group implemented an equity-settled share-based compensation plan in 2019
which provides for the award of long-term incentives and an annual bonus to
management personnel.
During the period, USD14,328 was recognised in the consolidated statement of
comprehensive income, in relation to share-based payments (30 September 2023:
USD14,109).
7. Treasury shares
Number GBP '000 USD '000
Treasury shares as at 31 March 2023 (audited) 4,636,331 11,033 14,216
Exercise of long-term incentive options (52,048) (123) (155)
Treasury shares as at 30 September 2023 (unaudited) 4,584,283 10,910 14,061
Treasury shares as at 31 March 2024 (audited) 4,584,283 10,910 14,061
Treasury shares as at 30 September 2024 (unaudited) 4,584,283 10,910 14,061
On 2 June 2023, following an exercise of share options on 24 May 2023 under
the Yellow Cake plc Share Option Plan 2019, 31,686 ordinary shares held as
treasury shares were transferred at 213p per share to satisfy the exercise.
On 25 July 2023, following an exercise of share options on 19 July 2023
under the Yellow Cake plc Share Option Plan 2019, 20,362 ordinary shares held
as treasury shares were transferred at 288p per share to satisfy the exercise.
Following these transfers, the total number of treasury shares in the Company
reduced from 4,636,331 to 4,584,283. The reduction in the value of treasury
shares resulting from the exercise of share options was calculated based on
the weighted average acquisition cost of the treasury shares.
8. Commission, procurement and consultancy fees
308 Services Limited ("308 Services") provides procurement services to the
Group relating to the sourcing of U(3)O(8) and other uranium transactions and
in securing competitively priced converter storage services.
Under the terms of the agreement entered into between the Group and 308
Services on 30 May 2018, 308 Services is entitled to receive:
1. Holding Fee comprised of a Fixed Fee of USD275,000
per calendar year plus a Variable Fee equal to 0.275% per annum of the amount
by which the value of the Group's holdings of U(3)O(8) exceeds USD100 million;
and
2. Storage Incentive Fee equal to 33% of the difference
between the amount obtained by multiplying the Target Storage Cost (initially
set at USD0.12 /lb per year) by the volume of U(3)O(8) (in pounds) owned by
the Group on 31 December of each respective year and the total converter
storage fees paid by the Group in the preceding calendar year.
The Group considers Holding Fees and Storage Incentive Fees to be costs of an
ongoing nature. During the period the Group paid Holding Fees and Storage
Incentive Fees of USD2,476,984 (30 September 2023: USD1,469,168) to 308
Services.
308 Services is also entitled to receive commissions equivalent to 0.5% of the
transaction value in respect of certain uranium sale and purchase transactions
completed at the request of the Yellow Cake Board. Commissions in respect of
the period payable by the Company to 308 Services were USD500,000 (30
September 2023: USD330,075).
In addition, if the purchase price paid by the Group in respect of such a
purchase transaction is in the lowest quartile of the range of reported
uranium spot prices in the calendar year in which the transaction was agreed,
308 Services is entitled to receive, at the beginning of the following
calendar year, an additional commission of 0.5% of the value of the uranium
transacted. If the purchase price paid by the Group in respect of such a
purchase transaction is in the second lowest quartile of the range of reported
uranium spot prices in the calendar year in which the transaction was agreed,
308 Services is entitled to receive, at the beginning of the following
calendar year, an additional commission of 0.25% of the value of the uranium
transacted. If the purchase price is in the top half of the range for the
calendar year in which the transaction was agreed, no additional commission
will be payable to 308 Services.
The purchase price paid by the Group in respect of the uranium purchase
completed in June 2024 was in the second lowest quartile of the range of
reported uranium spot prices in the 2023 calendar year, being the calendar
year in which the uranium purchase transaction was agreed. The Group has
therefore recognised an additional commission of USD250,000 in respect of this
uranium purchase transaction within these interim financial statements equal
to 0.25% of the value transacted, which will be payable in the next calendar
year.
During the period, commissions payable to 308 Services totalled USD750,000 (30
September 2023: USD660,150).
9. Related party transactions
During the period, the Group incurred USD118,541 (30 September 2023:
USD86,033) of administration fees payable to Langham Hall Fund Management
(Jersey) Limited ("Langham Hall"). Claire Brazenall is an employee of Langham
Hall and has served as a Non-Executive Director of the Company since 9
November 2022, for which she has received no Directors' fees. As at 30
September 2024 there were no amounts due to Langham Hall (31 March 2024: USD
nil).
The following Directors own ordinary shares in the Company as at 30 September
2024:
Name Number of ordinary shares % of share capital
The Lord St John of Bletso* 26,302 0.01%
Sofia Bianchi 13,186 0.01%
The Hon Alexander Downer 29,925 0.02%
Claire Brazenall - -
Alan Rule 18,837 0.01%
Andre Liebenberg 121,478 0.06%
Carole Whittall 101,966 0.05%
Total 311,694 0.16%
* The Lord St John of Bletso's shares are held through African Business
Solutions Limited, in which he holds 100% of the Ordinary Shares.
While the Non‐Executive Directors hold shares in the Company, the holdings
are considered sufficiently small so as not to impinge on their independence.
10. Earnings per share
1 April 2024 1 April 2023
To To
30 September 2024 30 September 2023
(unaudited) (unaudited)
USD '000 USD '000
(Loss)/profit for the period (USD '000) (87,616) 458,824
Weighted average number of shares during the period - Basic* 216,856,447 198,135,025
Weighted average number of shares during the period - Diluted* 217,066,445 198,390,197
(Loss)/earnings per share attributable to the equity owners of the Company
(USD):
Basic (0.40) 2.32
Diluted (0.40) 2.31
*The weighted average number of shares excludes treasury shares.
11. Events after the period end
In the opinion of the directors, there are no significant events subsequent to
the period end that are deemed necessary to be disclosed in the consolidated
interim financial statements.
1 Based on the daily spot price of USD87.00/lb published
by UxC, LLC on 29 March 2024 and 20,155,601 lb of U₃O₈ held by the Company
on that date.
2 Based on the daily spot price of USD81.75/lb published
by UxC, LLC on 30 September 2024 and 21,682,318 lb of U₃O₈ held by the
Company on that date.
3 Daily spot price published by UxC, LLC on 29 March
2024.
4 Daily spot price published by UxC, LLC on 30 September
2024.
5 Net asset value as at 31 March 2024 of
USD1,883.6 million comprises 20.16 million lb of U(3)O(8) valued at the
daily spot price of USD87.00/lb published by UxC, LLC on 29 March 2024 and
cash and other net current assets of USD130.1 million.
6 Net asset value as at 30 September 2024 of
USD1,796.0 million comprises 21.68 million lb of U(3)O(8) valued at the
daily spot price of USD81.75/lb published by UxC, LLC on 30 September 2024
and cash and other net current assets of USD23.5 million.
7 Net asset value per share as at 31 March 2024 is
calculated assuming 221,440,730 ordinary shares in issue less 4,584,283 shares
held in treasury on that date and the Bank of England's daily USD/GBP exchange
rate of 1.2632 on 28 March 2024.
8 Net asset value per share as at 30 September 2024 is
calculated assuming 221,440,730 ordinary shares in issue, less 4,584,283
shares held in treasury on that date and the Bank of England's daily USD/GBP
exchange rate of 1.3413.
9 Estimated net asset value as at 6 December 2024 is
neither audited nor reviewed.
10 Daily spot price published by UxC, LLC on 6 December 2024.
11 Cash and other net current assets of USD23.5 million as at
30 September 2024.
12 Estimated net asset value per share on 6 December 2024 is
calculated assuming 221,440,730 ordinary shares in issue, less 4,584,283
shares held in treasury on that date.
13 Ux Weekly, "Ux Price Indicators"; 30 September 2024.
14 Ux Weekly, "The Market"; 20 May 2024 and 7 October 2024.
15 US Department of Energy Press Release; "Biden‐Harris
Administration Enacts Law Banning Importation of Russian Uranium"; 14 May
2024.
16 World Nuclear News; "Commercial operation marks completion
of Vogtle expansion"; 29 April 2024.
17 The Gazette; "NextEra CEO says he'd "consider" restarting
Duane Arnold nuclear power plant"; 27 June 2024.
18 Constellation Energy Press Release, "Constellation to Launch
Crane Clean Energy Center, Restoring Jobs and Carbon-Free Power to the Grid";
20 September 2024.
19 Datacenterdynamics.com, "Oracle to build nuclear SMR-powered
gigawatt data center"; 11 September 2024.
20 World Nuclear News; "Google and Kairos Power team up for SMR
deployments"; 15 October 2024.
21 Amazon Press Release; "Amazon signs agreements for innovative
nuclear energy projects to address growing energy demands"; 16 October 2024.
22 U.S. Department of Energy, Office of Nuclear Energy, "Could
the Nation's Nuclear Power Plant Sites Support New Reactor Builds?"; 9
September 2024.
23 Power Philippines; "DOE eyes 2,400 MW for small modular
reactors"; 10 June 2024.
24 Japan Atomic Industrial Forum; "Japanese Cabinet Approves
Japan's Energy White Paper 2024"; 4 June 2024.
25 Asahi Shimbun; "Japan to allow building new reactors if
others are dismantled"; 16 June 2024.
26 Asahi Shimbun; "Nuke authorities approve loading fuel at
Niigata nuclear plant"; 15 April 2024.
27 World Nuclear News; "Takahama units cleared for extended
operation"; 29 May 2024.
28 Vattenfall Press Release; "Forsmark and Ringhals nuclear
power plants aim for 80 years of operation of existing reactors"; 17 June
2024.
29 World Nuclear News; "New nuclear included in draft Korean
energy plan"; 31 May 2024.
30 Mining.com; "South Korea, Kazakhstan sign minerals deals as
Seoul moves to diversify supply chain"; 12 June 2024.
31 World Nuclear News, "Construction permit granted for new
Korean APR1400 units"; 12 September 2024.
32 Taiwan News; "Taiwan's Maanshan Nuclear Plant Unit 1 to shut
down in July"; 29 May 2024.
33 TaiwanPlus News; "Taiwan's Government Open to Possibility of
continuing Nuclear Power"; 30 May 2024.
34 ROSATOM Digital Press Office; "The Russian Federation and
Uzbekistan sign an agreement on the construction of a small nuclear power
plant"; 27 May 2024.
35 Weekly Blitz; "Russian Rosatom proposes establishing several
small nuclear power plants in Bangladesh"; 5 April 2024.
36 Datacenterdynamics.com; "Norsk Kjernekraft wants to build
small modular nuclear reactors at Norway's data centres"; 21 May 2024.
37 World Nuclear News, "Italy could get 22% of electricity from
nuclear by 2050"; 2 July 2024.
38 Xinhua; "China's nuclear power generation reached 440,000
GWh in 2023"; 23 April 2024.
39 Bloomberg News, "China Makes $31 Billion Nuclear Push With
Record Approvals"; 19 August 2024.
40 Reuters; "Exclusive: UAE planning second nuclear power
plant, sources say"; 26 April 2024.
41 Indonesian National News Agency, "Nuclear power included in
National Electricity Plan: ESDM Ministry"; 11 July 2024.
42 AzerNews, "Countries of Eastern Europe intend to build at
least 12 nuclear power units"; 15 July 2024.
43 Reuters, "South African Energy Chief Seeks Nod for Nuclear
Plant"; 7 July 2024.
44 Reuters, "South African nuclear power plant wins approval
for 20-year life extension"; 15 July 2024.
45 Nuclear Engineering International, "Russia unveils nuclear
expansion plan"; 26 August 2024.
46 World Nuclear News, "International banks express support for
nuclear expansion"; 23 September 2024.
47 International Atomic Energy Agency Press Release, "IAEA
Outlook for Nuclear Power Increases for Fourth Straight Year, Adding to Global
Momentum for Nuclear Expansion"; 16 September 2024.
48 Cameco Press Release, "Cameco reports Q2 results: 2024 outlook on
track; strong operational performance; financial results reflect transition to
tier-one economics; durable demand outlook driving long-term price increases;
disciplined strategy capturing long-term value"; 31 July 2024.
49 Kazatomprom Press Release, "Kazatomprom informs on Changes
to Mineral Extraction Tax Rate"; 10 July 2024.
50 Kazatomprom Press Release, "Kazatomprom 2Q24 Operations and
Trading Update"; 1 August 2024.
51 Kazatomprom Press Release, "Kazatomprom 1H24 Financial
Results and 2025 Production Plan Update"; 23 August 2024.
52 Orano Press Release; "Update on the situation of the
Imouraren mining project in Niger"; 20 June 2024.
53 GoviEx Uranium Press Release; "GoviEx Uranium Provides
Update on Madaouela Project"; 4 July 2024.
54 Ux Weekly Vol 38, No 47; 18 November 2024.
55 Based on the daily spot price of USD87.00/lb published by
UxC, LLC on 29 March 2024 and 20,155,601 lb of U₃O₈ held by the Company on
that date.
56 Based on the daily spot price of USD81.75/lb published by UxC,
LLC on 30 September 2024 and 21,682,318 lb of U₃O₈ held by the Company on
that date.
57 Daily spot price published by UxC, LLC on 29 March 2024.
58 Daily spot price published by UxC, LLC on 30 September 2024.
59 Net asset value as at 31 March 2024 of USD1,883.6 million comprises
20.16 million lb of U(3)O(8) valued at the daily spot price of USD87.00/lb
published by UxC, LLC on 29 March 2024 and cash and other net current assets
of USD130.1 million. Net asset value per share as at 31 March 2024 is
calculated assuming 221,440,730 ordinary shares in issue less 4,584,283 shares
held in treasury on that date and the Bank of England's daily USD/ GBP
exchange rate of 1.2632.
60 Net asset value as at 30 September 2024 of USD1,796.0 million
comprises 21.68 million lb of U(3)O(8) valued at the daily spot price of
USD81.75/lb published by UxC, LLC on 30 September 2024 and cash and other net
current assets of USD23.5 million. Net asset value per share on 30 September
2024 is calculated assuming 221,440,730 ordinary shares in issue less
4,584,283 shares held in treasury on that date and the Bank of England's daily
USD/ GBP exchange rate of 1.3413.
61 Daily spot price published by UxC, LLC on
30 September 2024.
62 Cash and cash equivalents and other net current assets as
at 30 September 2024.
63 Daily spot price published by UxC, LLC on 29 March 2024.
64 Cash and cash equivalents and other net current assets as
at 31 March 2024.
65 Bank of England's daily USD/ GBP exchange rate as at 30
September 2024 and 28 March 2024.
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