Typical lumpiness in contracts with utilities held uranium fuel-broker and technology developer Centrus Corp. to a net loss in the third quarter of 2020, but the company expects to close out the year with a revenue bang, CEO Daniel Poneman told investors recently.
Also, Poneman said, construction of the company’s new, Department of Energy-funded uranium-enrichment cascade at DOE’s Portsmouth Site in Piketon, Ohio, remains on track to wrap up in early 2022 as scheduled, despite some COVID-19-related slowdowns in the supply chain.
Centrus had a net loss of nearly $9 million, or 83 cents a share, in the quarter ended Sept. 30, during which it delivered no enriched uranium to utilities. The company book keeps that money in its flagship LEU segment. In the 2019 third quarter, when there were more deliveries to utilities, the company posted a net income of nearly $21 million, or $2.17 a share.
Quarterly revenue company-wide was about flat year-over-year, at $154 million, according to the company’s latest 10-Q filing with the Securities and Exchange Commission.
But the cavalry is coming, Centrus said.
“We anticipate that revenue in the fourth quarter of this year for [the] LEU segment will be the highest of any quarter for 2020, assuming there are no interruptions to our planned customer deliveries based on changes in the market or Covid-19,” the company wrote in a statement Nov. 13.
Meanwhile, Centrus’ latest uranium enrichment demonstration for the Department of Energy remains more or less unaffected by the worsening COVID-19 pandemic, Poneman told investors on a conference call.
Centrus is building a 16-machine, enrichment cascade that will use the company’s AC100 technology to produce 19.75% uranium 235 for the Department of Energy. DOE wants to use this so-called high-assay low-enriched uranium (HALEU) fuel to help develop next-generation nuclear reactors.
“Construction activities are on track, on schedule and on budget,” Poneman said on the investor call, adding that there have been “issues with some of our suppliers as a result of the pandemic.”
Even so, “the demonstration should be completed in early 2022 and we can then transition to commercial production,” Poneman said. “The facility in PIketon, Ohio, is large enough to accommodate thousands of centrifuges if necessary.”
The company has a three-year, $115-million 80-20 cost-share contract with DOE for the work. Centrus’ AC100 technology is also in the running to produce low-enriched uranium for nuclear weapons programs at the National Nuclear Security Administration. The semi-autonomous DOE weapons steward was on track to choose between Centrus’ technology and an in-house option developed at the Oak Ridge National Laboratory by December.
