Cameco Corporation Q1 FY2025 earnings call

• Nuclear Energy Market Momentum: Cameco highlights positive momentum in the global nuclear energy market, with Canada's role in the global nuclear fuel supply chain due to its uranium resources and nuclear expertise.
• Q1 2025 Financial Results: Cameco saw revenue up 24%, gross profit up 44%, adjusted net earnings up 52%, and adjusted EBITDA up 5%. The first quarter average realized price increased year-over-year despite the average uranium spot price falling 30%.
• Westinghouse Outlook: Westinghouse is expected to have an annual net loss of $20M to $70M in 2025. Adjusted EBITDA for Westinghouse is a key performance measure, with 19% improvement in Q1 2025 compared to Q1 2024. First half results weaker, stronger performance in Q4.
• Uranium Segment Operations: Production from Northern Saskatchewan operations was 6 million pounds in Q1 2025, slightly higher than Q1 2024. Evaluating optimal mix of production, inventory, and purchases. JV Inkai targeting 8.3 million pounds of uranium for 2025, with deliveries expected in H2 2025.
• Fuel Services Production: Production up 5% in Q1 2025. Annual production expectation 13-14 million kg. Long-term uranium price around $80 per pound, marketing pipeline growing.
• Financial Strength: Strong balance sheet, repaid $200M term loan used to finance Westinghouse acquisition. Received $49M cash distribution from Westinghouse and $87M cash dividend from JV Inkai

Uranium Segment: In Q1 2025, Cameco's share of production from Northern Saskatchewan operations was 6 million pounds, slightly higher than 5.8 million pounds in Q1 2024. It continues to expect 18 million pounds of production from MacArthur River, Key Lake, and Cigar Lake. JV Inkai targets 8.3 million pounds of uranium for 2025, with Cameco's share at 3.7 million pounds, and deliveries expected in the second half of 2025. Revenue contribution details weren't explicitly stated but the segment is a key part of the business. Westinghouse Segment: Reported a net loss in Q1 2025. Expected annual net loss of $20 million to $70 million in 2025. Adjusted EBITDA improved 19% compared to Q1 2024. First half results expected to be weaker, with stronger performance and higher cash flows in the fourth quarter. Cameco's share of adjusted EBITDA is expected between $355 million and $405 million for the year. Fuel Services Segment: Production was up 5% in Q1 2025 compared to Q1 2024. Annual production expectation is between 13 million and 14 million kg of combined products. Revenue contribution details weren't explicitly stated but it's a significant segment in the nuclear fuel cycle

• Westinghouse: Expected annual net loss of $20M to $70M in 2025. Cameco's share of adjusted EBITDA for Westinghouse is between $355M and $405M.
• Uranium Segment: Expecting 18 million pounds of production from MacArthur River, Key Lake, and Cigar Lake operations. JV Inkai targeting 8.3 million pounds of uranium for 2025, with Cameco's share at 3.7 million pounds.
• Fuel Services: Annual production expected to be between 13 million and 14 million kg of combined products. Long-term uranium price around $80 per pound, marketing pipeline growing
• Long-Term Contracting: Uncovered uranium requirements through 2045 amount to 3.2 billion pounds, with 70% of needs still uncovered

• Geopolitical and Trade Risks: Geopolitical challenges, trade policies, and tariffs affecting uranium movement. Uncertainty in long-term utility contracting leading to uncovered uranium requirements.
• Supply Chain Challenges: Acid issues at JV Inkai impacting production. Transportation and logistics challenges, including Panama Canal constraints and reshuffling of ocean alliances.
• Uncertainty in Supply: Ongoing uncertainty in primary and secondary uranium supply, with 1.3 billion pounds of uranium requirements still unclear in source

Q: Orest Wowkodaw asks about capital allocation and returns to shareholders.

A: Grant Isaac discusses supply discipline, conservative financial approach, and potential capital returns, noting the need to navigate uncertainty before returning capital to shareholders Q: Ralph Profiti asks about industry markers for transition in fuel buyer procurement.

A: Tim Gitzel and Grant Isaac discuss uncovered uranium requirements, primary and secondary supply stacks, and the need for stronger demand to drive contracting Q: Alexander Pearce asks about Inkai deliveries and McArthur River production.

A: Tim Gitzel responds that Inkai deliveries are expected in H2 2025 and provides details on McArthur River production plans Q: Lawson Winder asks about transportation logistics and USTR Section 301.

A: Grant Isaac discusses transportation challenges, trade dependence, and the importance of monitoring transportation for the industry Q: Bob Brackett asks about Westinghouse's relationship with China.

A: Tim Gitzel and Grant Isaac talk about China's nuclear plans, Westinghouse's role in China, and the benefits of energy deals in U.S.-China relations Q: Gordon Johnson asks about exploration investment.

A: Tim Gitzel mentions exploration efforts, new VP of Exploration, and continued work on Athabasca Basin properties Q: Craig Hutchison asks about fuel services pricing.

A: Heidi Shockey and Grant Isaac discuss fuel services pricing, rolling on of new contracts, and future upside from stronger pricing Q: Andrew Wong asks about India's nuclear plans and inventory held by physical funds.

A: Tim Gitzel talks about India's nuclear ambitions and Grant Isaac discusses noise around inventory held by physical funds and its irrelevance to structural deficit