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BETHESDA, Md. - Centrus Energy (NYSE:LEU) Corp. (NYSE American: LEU) announced that its subsidiary, American Centrifuge Operating, LLC (ACO), has been selected as one of six awardees by the U.S. Department of Energy (DOE) to support the deconversion of High-Assay, Low-Enriched Uranium (HALEU) from uranium hexafluoride (UF6) to uranium oxide and/or uranium metal. This process is vital for the production of nuclear fuel.
The contract awarded to ACO has a minimum value of $2 million, with the maximum value for all awardees reaching up to $800 million. The final amount for ACO will depend on the task orders issued and their respective values.
Centrus Energy's President and CEO, Amir Vexler, emphasized the importance of the award in advancing the nuclear fuel supply chain and enhancing the capabilities of the company's Ohio facility. He noted that Centrus is the only U.S.-owned enrichment company using American technology and staffed by American workers, positioning it to reclaim leadership in the country's nuclear fuel sector.
Centrus Energy, known for providing nuclear fuel and services, has supplied more than 1,750 reactor years of fuel since 1998, which the company equates to avoiding the use of 7 billion tons of coal. The company also focuses on developing centrifuge technologies to potentially restore U.S. domestic uranium enrichment capabilities in the future.
The information for this report is based on a press release statement. The press release also contains forward-looking statements regarding Centrus Energy's future business and financial performance, which involve risks and uncertainties that could cause actual results to differ materially. These include risks related to DOE contracts, financing, market demand, legal restrictions on Russian uranium imports, competition, and government funding for HALEU. Centrus Energy has cautioned readers not to place undue reliance on these forward-looking statements, which are valid only as of the date of the news release.
In other recent news, Centrus Energy Corp. has been making notable strides in the uranium industry. The company reported mixed first-quarter 2024 financial results, with total revenue of $43.7 million, a gross profit of $4.3 million, and a net loss of $6.1 million. In a significant development, Centrus secured a contingent supply commitment with Korea Hydro & Nuclear Power, part of its efforts to secure $1.8 billion in sales commitments for the expansion of its operations.
The Biden administration is investigating an increase in enriched uranium imports from China, a development closely watched by Centrus and the broader uranium industry. The U.S. House of Representatives enacted a ban on Russian enriched uranium in December 2023, leading to a significant increase in uranium shipments from China.
Centrus has also been granted a partial waiver from the U.S. Department of Energy, allowing it to import low enriched uranium from Russia for deliveries already committed to its U.S. customers for the years 2024 and 2025. The company is actively pursuing funding to boost production of High Assay Low-Enriched Uranium, a special uranium fuel planned for use in next-generation nuclear reactors in the United States. These are recent developments that underline the evolving landscape in the nuclear fuel industry.
InvestingPro Insights
Centrus Energy Corp.'s recent contract award from the U.S. Department of Energy aligns with the company's strong financial performance and market position. According to InvestingPro data, Centrus has shown impressive revenue growth, with a 92.07% increase in quarterly revenue as of Q2 2024. This growth trajectory is further supported by the company's robust EBITDA growth of 95.18% over the last twelve months.
The company's profitability is also noteworthy, with InvestingPro Tips highlighting that Centrus has been profitable over the last twelve months and analysts predict continued profitability this year. This financial health is reflected in the company's ability to operate with a moderate level of debt and maintain liquid assets that exceed short-term obligations.
Investors have taken notice of Centrus Energy's potential, as evidenced by the significant returns over various time frames. InvestingPro data shows a remarkable 82.86% price return over the last month and a 64.86% return over the last three months. These strong returns align with the company's strategic positioning in the nuclear fuel sector and its recent contract win.
For those interested in a deeper analysis, InvestingPro offers 12 additional tips for Centrus Energy, providing a comprehensive view of the company's financial health and market position. These insights can be particularly valuable given the company's unique role in the U.S. nuclear fuel supply chain.
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