Centrus Energy Corp., Bethesda, Md., on Wednesday posted net income of about $41.5 million, or $2.95 a share for the 2021 third quarter, up from a loss of $7 million or 83 cents a share, in the year-ago period. Quarterly revenue was about $91 million, up from more than $57.5 million a year ago, mostly due to a $43.5 million pension settlement with the Department of Energy in the 2021 quarter, the company reported this week.
Quarterly revenue in the company’s bedrock LEU, or Separative Work Units, segment — which accounts for uranium fuel sold to utilities — was about $19 million, up from only $100,000 in the 2020 third-quarter, the company reported Wednesday after markets closed.
Revenue for the Uranium segment, which sells natural uranium to traders and utilities, was just under $13 million for the third quarter, down from more than $18.5 million in the 2020 quarter.
At the Technical Solutions segment, the main beneficiary of the pension settlement in the quarter, quarterly revenue was about $59 million, up from nearly $15 million in the 2020 third quarter. Net out the settlement and technical solutions revenue was about $20 million for the third quarter of 2021, the company said.
Technical Solutions handles Centrus’ uranium enrichment technology development, including the high-assay low enriched uranium (HALEU) demonstration contract with DOE and the Portsmouth Site in Piketon, Ohio.
The sole-source deal is a three-year, 80-20 cost-share pact including a two-year base and a one-year option that would increase its total value to $115 million. Centrus is seeking additional funding from DOE to cover cost overruns related to what the company characterized as COVID-19-related supply chain disruptions.
“Centrus has managed to keep our own construction work on track throughout the pandemic, as we have previously noted,” Centrus CEO Daniel Poneman said Thursday on a conference call with investors. However, “[t]he COVID-related challenges include increased delays from vendors and higher costs. We are working with the department to minimize the impacts and to address these cost increases as we go forward.”
Under the HALEU contract, Centrus is on the hook to produce 600 kilograms of high-assay low-enriched uranium fuel — consisting of about 20% uranium-235 — using AC100M centrifuges. It is supposed to be fuel for next-generation small modular reactors, which DOE wants to develop and commercialize. A planned Air Force micro reactor demonstration project at Eielson Air Force Base near Fairbanks, Alaska, would also use HALEU fuel. The service was expected to release a request for proposals for the reactor this fall, said Poneman.
“We expect that the centrifuge cascade will be completed and ready to begin demonstrating HALEU production next year,” Poneman said Thursday. Under the company’s contract with DOE, finalized in 2019, the cascade of 16 AC100 machines is supposed to switch on by March 1, 2022, provide a HALEU sample to DOE by March 15, 2022. the contract’s one year option, which DOE had yet to exercise at deadline, calls for production of at least 200 kilograms of HALEU by June 1, 2022.
