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Centrus Energy Q2 net loss $15.6 million

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Christian Fernsby |
Centrus Energy
Centrus Energy   Centrus generated total revenue of $10.6 million

Centrus Energy Corp. reported a net loss of $15.6 million for the quarter ended June 30, 2019.

Centrus generated total revenue of $10.6 million for the second quarter of 2019, a decrease of $28.8 million, or 73%, from the prior year period.

For the six-month period ended June 30, 2019, revenue was $49.3 million, a decrease of $25.8 million or 34%, from the same period in 2018.

Revenue from the LEU segment declined $30.3 million, or 92%, in the three months and $16.5 million, or 30% in the six months ended June 30, 2019, compared to the corresponding periods in 2018, reflecting the variability in timing of utility customer orders.

Consistent with prior years, revenue is anticipated to be heavily weighted to the second half of the year.

There was no revenue from separative work unit ("SWU") sales in the current quarter, and the volume of SWU sales declined 62% in the six-month period.

The average price billed to customers for sales of SWU declined 35% in the six-month period ended June 30, 2019, compared to the corresponding period in 2018, reflecting the trend of lower SWU market prices in recent years and the particular contracts under which SWU were sold during the periods.

The volume of uranium sales increased 528% in the six-month period ended June 30, 2019, compared to the corresponding period in 2018.

The average price billed to customers for uranium sales increased 13% in the six-month period.

Cost of sales for the LEU segment declined $35.2 million, or 82%, in the three months and $31.7 million, or 41%, in the six months ended June 30, 2019, compared to the corresponding periods in 2018, reflecting the decline in SWU sales volumes partially offset by the increase in uranium sales volume.

The average cost of sales per SWU declined approximately 21% in the six months ended June 30, 2019, compared to the corresponding period in 2018, primarily due to lower pricing in supply contracts.

Cost of sales includes legacy costs related to former employees of the Portsmouth and Paducah Gaseous Diffusion Plants of $1.8 million in the six months ended June 30, 2019 and June 30, 2018.

Centrus Energy's inventories are valued at the lower of cost or net realizable value.

Valuation adjustments for Centrus Energy's uranium inventory to reflect declines in uranium market price indicators totaled $2.3 million in the six months ended June 30, 2019, including $2.0 million in the second quarter of 2019.

Revenue from the contract services segment increased $1.5 million, or 23%, in the three months and declined $9.3 million, or 44%, in the six months ended June 30, 2019, compared to the corresponding periods in 2018.

The six-month period in 2018 included $9.5 million of revenue related to the January 2018 settlement with DOE related to past work performed.

Cost of sales for the contract services segment remained flat in the three months and declined $0.3 million, or 2%, in the six months ended June 30, 2019, compared to the corresponding periods in 2018, reflecting the mix of contract services work performed in each of the periods.

Centrus realized a gross loss of $4.3 million in the three months ended June 30, 2019, a decrease of $6.4 million compared to the gross loss of $10.7 million in the corresponding period in 2018.

In the six months ended June 30, 2019, the company realized a gross loss of $9.8 million, a decrease of $6.2 million compared to the gross loss of $16.0 million in the corresponding period in 2018.


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