TORONTO (miningweekly.com) – Canadian uranium producer Cameco on Thursday reported surging second-quarter earnings despite continued weakness in the global uranium market brought on by a near complete shutdown of all Japanese nuclear reactors since an earthquake and tsunami struck Japan in March 2011, crippling the Fukushima-Daiichi nuclear power plant.

Net earnings attributable to equity holders totalled $34-million, or $0.09 a share, in the quarter ended June 30, compared with $5-million in the same period in 2012.

Improved earnings from its uranium business, based on higher realised prices and increased sales volumes, positively impacted on net earnings, but were partially offset by market-to-market losses on foreign exchange derivatives.

On an adjusted basis, Cameco’s net earnings were $61-million, or $0.15 a share, compared with $31-million, or $0.08 a share. Analysts on average expected adjusted earnings of $0.19 a share on revenue of $571.54-million.

Revenue in the period soared 49% to $421-million.

“Despite the prolonged weakness in the uranium market, our strong contract portfolio has continued to serve us well, providing us with average realised prices that continue to be above the current uranium spot price,” president and CEO Tim Gitzel said.

He added that the company would implement restructuring to increase profitability and achieve a sustainable 10% future cost reduction. This resulted in the consolidation of a number of business and operating functions, which allowed the company to reduce the workforce by about 8%. In order to achieve the targeted cost reduction, Cameco incurred $13-million in restructuring costs, which would impact its financial results this year.

Cameco also said its share of the total capital cost for the Cigar Lake mine, in Saskatchewan, would increase by 15% to 25% from the previous estimate of C$1.1-billion. The mine, in which uranium major Areva also owns a significant stake, is expected to begin production at the end of the year.

The Saskatoon-based company said it did, however, see some progress in Japan. The Japanese Nuclear Regulatory Authority recently finalised new safety guidelines against which reactor restarts would be evaluated, and as of July 31, four utilities had applied to restart 12 reactors.