Uranium fuel broker and enrichment-technology developer Centrus Energy posted a profit in the second quarter, rounding out a profitable first half of 2020 in which a major enrichment demonstration contract with the Department of Energy helped stabilize revenue.
Second-quarter net income was more than $33.5 million, or $3.19 per share, up from a loss of $15.6 million, or $1.84, in the 2019 quarter, according to the Bethesda, Md., company’s latest earnings press release. Company-wide revenue was more than $75.5 million, up from around $10.5 million a year ago.
The major driver in the quarter just ended was a non-recurring settlement with a bankrupt customer that accounted for more than half of the roughly $58.5 million in Separative Work Units revenue — sales of enriched uranium to utilities. That is up from no revenue in the 2019 quarter. Centrus revenues can swing wildly from quarter to quarter as utilities, which sign annual contracts with the company, decide when to take delivery of nuclear fuel.
Uranium revenue for the quarter, which in Centrus’ bookkeeping accounts for natural uranium sold to companies that aren’t necessarily utilities, was a little under $5 million: up from more than $2.5 million in the 2019 period.
The Technical Solutions segment earned $13 million in second-quarter revenue, up from a little over $7 million on a year-over-year basis, Centrus reported. That was again “primarily” due to the company’s work on a new 16-machine enrichment cascade that will use the company’s AC100 technology to produce 19.75%-enriched uranium-235 for the Department of Energy. The federal agency wants to use this so-called high-assay low-enriched uranium (HALEU) fuel to help develop next-generation nuclear reactors.
Centrus has about 230 employees, many of whom are still working remotely amid the ongoing COVID-19 pandemic, according to the earnings presser. Some employees remain on-site at DOE’s Portsmouth Site in Piketon, Ohio, to keep an eye on the HALEU cascade.
On Wednesday’s call, Centrus President and CEO Daniel Poneman said the HALEU demonstration remains on-time and on-budget, despite the pandemic.
Centrus will build the cascade mostly from components that its suppliers had already built using parts that carry peaceful-use restrictions. That means the uranium the cascade eventually enriches — and DOE would have to pick up a contract options before that happens — cannot be legally used for nuclear-weapon programs. Centrus has said the cascade being built under the potentially $115-million cost-share contract could be adapted to make defense-usable uranium.
AC100 technology is one of two the National Nuclear Security Administration (NNSA) is considering using for a next-generation domestic enrichment facility needed in the 2040s to produce low-enriched uranium for tritium production.
Net income for the first six months of the year was $41 million, or $4.15 a share, up from a loss of $40.5 million, or $4.24 a share, in the 2019 half. Revenue in the 2020 half was more than $89 million, compared with about $12.5 million last year.
