TORONTO (miningweekly.com) – Dual-listed Paladin Energy on Thursday said it had widened its full-year loss by 110% to 172.8-million, mainly impacted by its decision to take an impairment associated with the write down of its Kayelekera assets in the September quarter of 2011.
The $133-million write-down and impairment of its Malawi assets was considered necessary as uranium prices fell after the Fukushima Daiichi nuclear disaster in Japan last year.
Sales revenue increased by 37% to $365.8-million, mainly as a result of 39% higher sales volumes of 6.7-million pounds of uranium oxide (U3O8) compared with the 2011 sales volume of 4.812-million pounds.
The average realised uranium price for the year was $55/lb of U3O8, slightly lower than the $56/lb it achieved in the last year. Year-on-year it cost the company slightly more to produce U3O8 at $39/lb.
The company said it had already signed new contracts for the delivery of 2.8-million pounds of U3O8 from 2012 to 2016, at prices ranging from $60/lb to $65/lb, as well as the extension of an existing contract for the delivery of more than one-million pounds over the same period at market-related pricing.
The yellowcake producer said term market interest from nuclear utilities in all regions had increased for deliveries starting in 2013/14, which would provide additional multiyear contracting opportunities in an improving long-term market.
At the end of June, Paladin had $112.1-million cash in the bank.
Paladin said the cost optimisation plan it had approved in 2011 had reduced corporate and marketing costs by at least 15%. Tighter controls have led to a reduction of corporate overheads, including travel costs and outsourced work. Labour costs were also reduced as the high capital investment phase had largely been completed.
In Labrador, Canada, the three-year moratorium on the mining, development and production of uranium ended, providing access to the Michelin deposit and validating Paladin's decision to acquire the Aurora uranium assets at a discounted price of $1.90/lb U3O8.
This had cleared the way to restart work on the project and substantial long-term resource increases were expected, the company said.
The company’s Toronto-listed stock closed down 3.52% at C$1.37 apiece on Thursday. The share price had more than halved in the past year.