Cameco (TSX: CCO) announced this morning its financial results for 2021, highlighting an annual revenue of $1.48 billion. This is a decrease from 2020’s revenue of $1.80 billion.
“Our results reflect the very deliberate execution of our strategy of full-cycle value capture,” said CEO Tim Gitzel. “We have been undertaking work to ensure we have operational flexibility, we are aligning our production decisions with the market fundamentals and our contracting portfolio, and we have been financially disciplined.”
Gross margin for the year came in at 0.1% compared to last year’s 5.9%. This further led to the firm notching a net loss of $102.7 million for the year compared to last year’s $53.2 million net loss.
The company’s operations are said to be heavily affected by the COVID-19 pandemic. For instance, as a result of its four-month precautionary production suspension at Cigar Lake, the property only produced 6.1 million pounds in 2021 which is below the committed sales.
For Q4, the firm earned $465 million in revenue, up from Q3 2021’s $361 million but down from Q4 2020’s $550 million. It also ended the quarter with net earnings of $11 million compared to a net loss of $72 million in the previous quarter and an $80 million net earnings in the previous year. The quarterly net income translates to $0.03 earnings per share.
Considering financial calibrations, adjusted net earnings came in at $23 million from a loss of $54 million last quarter and earnings of $48 million last year.
The company also ended the year with $1.25 billion in cash and cash equivalents, putting the balance of current assets at $2.14 billion. Current liabilities ended at $413.7 million.
The firm also announced the “next phase of our supply discipline decisions.” It has added 70 million pounds to its portfolio for the year and with the “improving market sentiment,” it bared its plans for its supply discipline strategy until 2024.
“Our plan in no way represents an end to our supply discipline,” explained Gitzel. “What we are contemplating for our supply discipline still represents a much greater reduction than any other producer has made. In fact, we are continuing with indefinite supply discipline.”
Coming from 2021 when the firm was operating at 75% below capacity, it plans to increase this to 40% below capacity by 2024. Gitzel added that this production plan will remain “until [the firm sees] further improvements in the uranium market and have made further progress in securing the appropriate homes for [its] unencumbered, in-ground inventory under long-term contracts.”
This plan includes producing 15 million pounds annually at McArthur River/Key Lake and 13.5 million pounds annually at Cigar Lake, for a combined 33% reduction of licensed capacity.
Cameco last traded at $25.24 on the TSX.
Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.