International Isotopes President and CEO Steve Laflin said in the company’s third quarter earnings report last week that design and construction progress on the Hobbs de-conversion facility would be “put on hold” until more contracts could be found. “Part of that cost control involves placing additional engineering work and formal design activities for the planned Hobbs de-conversion facility on hold for the time being,” he said in a statement. “We are still confident that we will eventually be able to obtain contracts for additional de-conversion service and once we have fully committed the capacity of the facility under contract we will once again resume our search for financing the balance of the project and resume the schedule for design and construction.” The planned facility, located on a 640-acre parcel in Lea County, N.M., marks the first commercial depleted uranium de-conversion facility in the United States. International Isotopes entered into a contract with URENCO to provide depleted uranium de-conversion services for its enrichment facility located in Eunice, New Mexico. This contract amounts to 50 percent of the facilities de-conversion capabilities.
The earnings report also showed a relatively stagnant gross profit for the third quarter and yearly totals so far. Gross profit for the third quarter was $623,942 compared to $626,507 gross profit in 2012, a decrease of one percent. Gross profit for the year so far is $1,991,574 compared to $1,954,200 in 2012, an increase of around two percent. The company also announced that operating expenses were reduced in the third quarter from last year by 20 percent, and operating expenses were down 13 percent for the year to date so far compared to 2012. “Despite the small decline in revenue seen this year we have been able to successfully control production costs and reduce operating expenses in order to improve gross profit and continue to move the company to profitability,” said Laflin. Part of the expenses reduced included research and development expenses of the planning and construction of the de-conversion facility in New Mexico, which decreased by 48 percent and 29 percent for the third quarter and year to date, compared to the same periods in 2012.
