• Net Earnings: Strong fourth quarter and annual net earnings, reflecting a return to tier 1 production levels, higher sales volumes, and improved average realized price.
• Adjusted Net Earnings: Reflects strong underlying performance, excluding the full-year net loss from Westinghouse due to purchase accounting impacts.
• Adjusted EBITDA: Westinghouse's adjusted EBITDA was very strong, indicating robust performance.
• Uranium Production: Produced about 23.4 million pounds in 2024, with strong production from MacArthur River Key Lake operation.
• Uranium Deliveries: Delivered just under 34 million pounds of uranium in 2024.
• Long-term Uranium Contracts: Commitments to deliver an average of about 28 million pounds of uranium over the next five years.
• Fuel Services Contracts: Long-term contract book totals approximately 85 million kg of UF6.
• Debt Refinancing: Successfully refinanced $500 million in unsecured debt, extending maturity to 2031.
• Term Loan Repayment: Fully repaid the $600 million US floating rate term loan used for Westinghouse acquisition.
• Westinghouse Distribution: Received first distribution of $49 million US from Westinghouse.

• Warning! GuruFocus has detected 3 Warning Sign with CCJ.

Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Cameco Corp (NYSE:CCJ) reported strong fourth quarter and annual net earnings, reflecting a return to tier 1 production levels, higher sales volumes, and improved average realized prices.
• The company has a robust long-term contract portfolio, with commitments to deliver an average of about 28 million pounds of uranium over the next five years.
• Cameco Corp (NYSE:CCJ) has positioned itself to benefit from supportive market conditions in the nuclear sector, with a positive outlook for existing and new nuclear reactors.
• The company successfully refinanced $500 million in unsecured debt, extending the maturity to 2031, and fully repaid a $600 million US floating rate term loan used for the acquisition of Westinghouse.
• Cameco Corp (NYSE:CCJ) has a strong balance sheet, enabling it to self-manage risks related to global macroeconomic uncertainty and trade policy decisions.

Negative Points

• Uranium production at Inkai was impacted by ongoing supply chain issues in Kazakhstan, particularly related to sulfuric acid deliveries, resulting in lower production than planned.
• Cameco Corp (NYSE:CCJ) faces potential risks from US tariffs on Canadian energy products, although the company has taken steps to mitigate potential impacts.
• The company experienced a decline in reported long-term contracting volumes in 2024, which remained below the replacement rate contracting level.
• There is uncertainty regarding future production levels at JV Inkai, with ongoing discussions with Kazatomprom to determine 2025 production plans.
• Cameco Corp (NYSE:CCJ) is facing challenges related to aging infrastructure and potential bottlenecks at Key Lake, requiring capital projects to ensure reliability and sustainability.

Q & A Highlights

Q: Can you provide an update on the current term market for uranium contracts and any changes in utility buying behavior? A: Grant Isaac, CFO, noted that while term volumes were down in 2024 compared to 2023, term prices increased significantly, indicating a recognition of the need for higher production economic pricing. Utilities still need to purchase a substantial amount of uranium, and the demand is being pushed into a window where supply is tight, which is constructive for pricing. Cameco is being patient, focusing on conversion and fabrication opportunities, and waiting for the market to price in the challenges facing uranium supply.

Q: How is Cameco addressing the recent production suspension at Inkai and its impact on 2025 production levels? A: Tim Gitzel, CEO, stated that Cameco has a strong long-term relationship with Kazatomprom, their partner in Kazakhstan, and they are working together to address the production suspension. Production resumed on January 23, 2025, and discussions are ongoing to determine the impact on 2025 production plans. Cameco remains committed to its strategy in Kazakhstan.

Q: What is the impact of potential US tariffs on Canadian energy products on Cameco's operations and contracts? A: Tim Gitzel explained that Cameco has taken steps to mitigate the potential impact of US tariffs, including adding clauses in contracts to pass tariff costs to customers and positioning material strategically. Grant Isaac added that a 10% tariff would likely increase uranium prices by 10% due to inelastic demand and low domestic supply substitution, which would ultimately be price supportive for the market.

Q: Can you update us on the progress and opportunities related to Westinghouse's AP1000 builds and the recent settlement with KHNP? A: Grant Isaac highlighted that the AP1000 opportunities are significant, with projects in Poland, Bulgaria, and Slovenia, among others. The settlement with KHNP opens the door for future cooperation, expanding Westinghouse's energy systems business. The AP1000 is seen as a key technology for meeting nuclear energy goals, and the collaboration with Korea is expected to enhance opportunities in various markets.

Q: How is Cameco planning to address the structural deficit in uranium supply and prepare its assets for future demand? A: Grant Isaac emphasized that Cameco is strategically patient, waiting for demand to show up while preparing its assets for maximum exposure to higher prices. The company is investing in revitalization and optimization projects to ensure reliability and sustainability, positioning itself to take advantage of future production opportunities as demand increases.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.