USEC EMPHASIZES COMMITMENT TO AMERICAN CENTRIFUGE AFTER BIG LOSS

USEC executives sought to reassure investors of the company’s future in a call yesterday after reporting $1.2 billion in losses in 2012, emphasizing that the American Centrifuge project is on a path toward obtaining a Department of Energy loan guarantee. USEC still needs about $4 billion in financing for the project—in addition to the $2 billion DOE loan guarantee, USEC CEO John Welch said that the company would need a $1 billion loan from the Japanese export credit agency and likely at least $1 billion dollars of additional equity capital. While USEC was forced last year to declare $1.1 billion in ACP expenses as a loss, he emphasized that since then a DOE program supporting ACP has gone well. “We understand your concerns about the business, especially with regard to the accounting action for 2012 and what it means for the future of the American Centrifuge,” Welch said. “Please know that we are as committed as ever to moving forward with commercialization of the American Centrifuge and continue to believe that it is the path to USEC’s long term competitiveness in the uranium enrichment business and the best way to maximize value for all stakeholders.”

DOE provided about $44 million in additional funding for the program on Friday, Welch said, which will fund it through June. Last week USEC also extended a credit facility with lenders until September for a total of $110 million. Welch also told investors that the company has not had a formal evaluation of a potential sale of the company or the ACP technology. And while a DOE tails reenrichment program for the Paducah Gaseous Diffusion Plant run by USEC is set to expire at the end of May, Welch said USEC is in talks with DOE on extending that program for several months. “An important topic in these discussions with DOE is the timing of our delease of the site. We are seeking to minimize our transitions costs, which could be substantial. We expect to delease the site and return it to DOE in 2014,” he said.