Centrus Energy Corp. on Monday reported $9.3 million of net income in the 2020 first quarter, up from a loss of more than $20 million a year ago, as revenue improved to $45 million from just under $40 million a year ago,
That comes out to earnings of $0.95, on a diluted, per-share basis, up from a loss of $2.40 per share a year ago, according to the Bethesda, Md.-based nuclear-fuel broker and technology development company.
Uranium-fuel and natural-uranium brokerage revenue in the low-enriched uranium segment, the company’s top business line, fell nearly $4.5 million to just over $30 million, mostly because Centrus didn’t sell any natural uranium in the period. That left only segment revenue from separative work sales — enriched uranium sold to utilities — which more than doubled the 2019 mark of about $12.5 million, Centrus reported.
In the Technical Solutions segment, which includes the company’s work on next-generation enrichment technology, quarterly revenue nearly quadrupled to more than $14 million from about $3.5 million in 2019. Most of that was from the company’s potentially three-year, $115 million, cost-share contract with the Department of Energy to build a mostly domestically sourced 16-machine enrichment cascade at the agency’s Portsmouth Site in Ohio.
That cascade is supposed to produce uranium fuel containing 19.75% uranium-235, called high-assay low-enriched uranium (HALEU), that DOE wants to help develop next-generation nuclear reactors. The underlying AC100 technology could be used by DOE’s semiautonomous National Nuclear Security Administration (NNSA) starting in the 2040s to make low-enriched uranium to produce tritium for nuclear weapons.
The 16-machine cascade will not itself, at least as planned, produce unobligated uranium that could be used for defense purposes, Centrust CEO Daniel Poneman said Tuesday on a conference call with investors.
“A few of the legacy components we are using in the demonstration cascade do contain some foreign material, but we could swap those out with identical U.S. components if unobligated enrichment is needed in the future,” Poneman said.
The demo cascade is using mostly parts that are already built, a Centrus spokesperson said Tuesday. New parts to make unobligated uranium could be built “quickly.”
Centrus revenues can swing wildly from quarter to quarter, as utilities decide when to take delivery of nuclear fuel.
“Operating results for the three months ended March 31, 2020, are not necessarily indicative of the results that may be expected for the year ending December 31, 2020,” the company stated Monday in its latest quarterly earnings report.
In its previous earnings report, Centrus suspended its 2020 earnings guidance because of the ongoing COVID-19 pandemic, and said it might not return to profitability for 2020 as predicted last year.
During the quarter, Centrus, like many other businesses, began asking most of its employees to telework to avoid spreading COVID-19: the respiratory disease caused by the novel coronavirus that broke out in Wuhan, China, in 2019. Those mandates continue, Poneman said Tuesday.
When states and localities begin to ease restrictions on movement and gatherings because of COVID-19, Centrus will start bringing people back to work in accordance with whatever guidelines the various levels of government provide.
“[T]he health and safety of our employees is our paramount concern,” Poneman said.
