Uranium producer, Cameco posted 30% hike to its Q4 profits after markets closed largely on the success of its Uranium business.
For the 3 months ended December 31st 2011, Cameco posted net earnings of USD 265 million or USD 0.67 per share up 29% from USD 206 million or USD 0.52 per share a year ago.
Adjusted for certain one time items, earnings rose 31% to USD 249 million or USD 0.63 per share. Revenues for the period increased 45 percent to USD 977 million from USD 673 million in the same quarter last year.
Uranium revenues rose 60% to USD 731 million as the company produced 6.6 million pounds of Uranium up 3%. Cameco sold 13.8 million pounds of Uranium, up 52% at an average realized price of USD 52.09 per pound up seven percent from a year ago.
Cameco expects to produce a total of 21.7 million pounds of Uranium in 2012. Based on the contracts that it already has in place it expects to sell between 31 million and 33 million pounds of Uranium during the year though prices are expected to fall between flat and 5%.
Revenues under its fuel services segment increased 16% to USD 106 million. Cameco produced less Uranium hexafluoride than it did a year ago, though it sold 14% more. Meanwhile its electricity business posted a 14% decline in revenues due to lower output and lower prices.
Cameco said that its operations were negatively affected by the March 2011 earthquake and tsunami in Japan, which resulted in the failure of the Fukushima Daiichi nuclear power plant there. The plant leaked nuclear toxins leading to reduced public confidence in the use of nuclear materials.
As a result, Germany which represents five percent of the world's nuclear generating capacity, opted to revert to its previous phase out policy. It has already shut down eight of its nuclear reactors and will shut down the remaining nine by 2022.
Mr Tim Gitzel CEO of Cameco said that "2011 was a challenging year for the nuclear industry. However it was business as usual for us and in some ways, even better than usual. We achieved a number of financial records including record revenue and gross profit from our nuclear business and record realized prices for Uranium. At our operations we delivered on a number of key milestones in a safe and responsible manner."
(Sourced from www.proactiveinvestors.com.au)
