Net loss of $6.1 million on $43.7 million in revenue, compared to net income of $7.2 million on $66.9 million in revenue in Q1 2023 Consolidated cash balance of $209.3 million as of March 31, 2024 Continued enrichment operations in Piketon, Ohio, with total production of approximately 135 kilograms of High Assay Low-Enriched Uranium ("HALEU") Signed approximately $900 million in contingent sales commitments for Low-Enriched Uranium ("LEU") BETHESDA, Md., May 7, 2024 /PRNewswire/ -- Centrus Energy Corp. (NYSE:LEU) ("Centrus" or the "Company") today reported first quarter 2024 results. The Company reported a net loss of $6.1 million for the three months ended March 31, 2024, which is $0.38 (basic and diluted) per common share. "Centrus had a strong start to the year, making additional HALEU deliveries to the Department of Energy ("Department" or "DOE") and submitting bids on two Requests for Proposals from the Department aimed at expanding its HALEU production capacity. In addition, the Company signed approximately $900 million in contingent LEU sales commitments to support the potential construction of LEU production capacity alongside our HALEU production," said Centrus President and CEO, Amir Vexler. "Recent funding legislation enacted with wide, bipartisan support includes a $2.7 billion federal investment in domestic enrichment. With the support of a strong, public-private partnership, we look forward to scaling up production to meet the full range of commercial and national security requirements for enriched uranium, including HALEU for advanced reactors and LEU for the existing reactor fleet. While our first quarter results reflect the expected quarter-to-quarter fluctuations in our revenues and margins – largely resulting from the timing of customer deliveries – we are encouraged by the progress we are making to reclaim American leadership in uranium enrichment." Financial Results Centrus generated total revenue of $43.7 million and $66.9 million for the three months ended March 31, 2024 and 2023, respectively, a decrease of $23.2 million. Revenue from the LEU segment was $23.6 million and $58.8 million for the three months ended March 31, 2024 and 2023, respectively, a decrease of $35.2 million. SWU revenue decreased by $35.2 million as a result of a decrease in the volume of SWU sold and a decrease in the average price of SWU sold. Revenue from the Technical Solutions segment was $20.1 million and $8.1 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $12.0 million. Revenue generated by the HALEU Operation Contract increased $12.0 million due to the transition from Phase 1 to Phase 2 in late 2023. Cost of sales for the LEU segment was $23.1 million and $34.9 million for the three months ended March 31, 2024 and 2023, respectively, a decrease of $11.8 million. SWU costs decreased by $12.3 million as a result of a decrease in the volume of SWU sold, partially offset by an increase in the average unit cost of SWU sold. Cost of sales for the three months ended March 31, 2024 and 2023 included $0.3 million and $2.1 million, respectively, for the revaluation of inventory loans. Cost of sales for the Technical Solutions segment was $16.3 million and $9.0 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $7.3 million. Costs incurred for the HALEU Operation Contract increased by $7.3 million due to the transition from Phase 1 to Phase 2 in late 2023. Gross profit for the Company was $4.3 million and $23.0 million for the three months ended March 31, 2024 and 2023, respectively. The decrease for the three months ended March 31, 2024 was primarily attributed to the decrease in gross profit in the LEU segment, as previously discussed. LEU customers generally have multi-year contracts that carry annual purchase commitments, not quarterly commitments. The gross profit in our LEU business varies based upon the timing of those contracts. The pricing of those deliveries varies depending upon the market conditions at the time the contract was signed with a portion of our outstanding contracts entered into at historically higher prices. The Company's gross profit was lower primarily due to the composition of contracts in the prior year, which included legacy and higher priced contracts. This was partially offset by an increase in gross profit in the Technical Solutions segment, primarily related to the transition from Phase 1 to Phase 2 of the HALEU Operation Contract. HALEU Update On October 11, 2023, the Company announced the beginning of enrichment operations, and on November 7, 2023, it announced its first delivery of 20 kilograms of HALEU uranium hexafluoride (UF6), completing Phase 1 of the HALEU Operation Contract under budget and ahead of schedule. The DOE is contractually required to provide storage cylinders necessary to collect the output of the cascade. Using the storage cylinders currently made available by the DOE, Centrus has now achieved cumulative deliveries to the DOE of approximately 135 kilograms of HALEU UF6. On November 28, 2023 and January 9, 2024, the DOE issued two RFPs for the deconversion and enrichment of HALEU, respectively. The Company submitted bids for both RFPs, with the goal of expanding HALEU production capability at the Piketon, Ohio facility. Contingent Sales Commitments Centrus also announced that it has signed approximately $900 million in contingent LEU sales commitments, subject to entering into definitive agreements, in support of potential construction of LEU production capacity at Centrus' American Centrifuge Plant in Piketon, Ohio. These commitments, reflecting deliveries of LEU to customers from 2028 to 2040, are contingent upon Centrus securing substantial public and private funding and financing to build the new capacity. Centrus competes against large, government-owned entities and is the sole publicly traded enrichment company in the industry. Congress recently included $2.72 billion for new, domestic nuclear fuel production as part of a government funding bill signed into law on March 9, 2024. Enriched Uranium Ban On April 30, 2024, the Senate passed the Prohibiting Russian Uranium Imports Act (H.R. 1042), which bans uranium imports from Russia and becomes effective 90 days after enactment. The legislation, which was previously passed by the U.S. House of Representatives, has been presented to the President of the United States for signature into law. The legislation includes a provision that allows for the granting of waivers through 2027, including if the waiver serves the national interest. When the legislation is enacted, we will apply for waivers from the Secretary of Energy and other applicable government agencies to request permission to continue supplying LEU to our customers. It is uncertain whether any waiver would be granted and, if granted, whether any waiver would be granted in a timely manner. The Company anticipates having adequate liquidity to support its business operations for at least the next 12 months. About Centrus Energy Corp. Centrus Energy is a trusted supplier of nuclear fuel components and services for the nuclear power industry. Centrus provides value to its utility customers through the reliability and diversity of its supply sources – helping them meet the growing need for clean, affordable, carbon-free electricity. Since 1998, the Company has provided its utility customers with more than 1,750 reactor years of fuel, which is equivalent to 7 billion tons of coal. With world-class technical and engineering capabilities, Centrus is also advancing the next generation of centrifuge technologies so that America can restore its domestic uranium enrichment capability in the future. Find out more at centrusenergy.com. Forward-Looking Statements: This news release contains "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. In this context, forward-looking statements mean statements related to future events, which may impact our expected future business and financial performance, and often contain words such as "expects", "anticipates", "intends", "plans", "believes", "will", "should", "could", "would" or "may" and other words of similar meaning. These forward-looking statements are based on information available to us as of the date of this news release and represent management's current views and assumptions with respect to future events and operational, economic and financial performance. Forward-looking statements are not guarantees of future performance, events or results and involve known and unknown risks, uncertainties and other factors, which may be beyond our control. For Centrus Energy Corp., particular risks and uncertainties (hereinafter "risks") that could cause our actual future results to differ materially from those expressed in our forward-looking statements include but are not limited to and which are, and may be, exacerbated by any worsening of the global business and economic environment include but are not limited to the following: risks related to the war in Ukraine and geopolitical conflicts and the imposition of sanctions or other measures by (i) the U.S. or foreign governments and institutions, (ii) organizations (including the United Nations or other international organizations), or (iii) entities (including private entities or persons), that could directly or indirectly impact our ability to obtain, deliver, transport or sell low enriched uranium ("LEU") or the Separative Work Units ("SWU") and natural uranium hexafluoride components of LEU delivered to us under our existing supply contract with the Russian government-owned entity, TENEX, Joint-Stock Company ("TENEX") ("TENEX Supply Contract"), or make related payments or deliveries of natural uranium hexafluoride to TENEX; risks related to proposed and imminent legislation to ban imports of Russian LEU into the United States, or transaction with the Russian State Atomic Energy Corporation ("Rosatom") or its subsidiaries, which includes TENEX, or similar bills that become law and the potential inability to secure a waiver or other exception from the ban or sanction in a timely manner or at all in order to allow us to continue importing Russian LEU under the TENEX Supply Contract or otherwise doing business with TENEX or implementing the TENEX Supply Contract; risks related to the refusal or inability of TENEX to deliver LEU to us if, among other reasons, (i) U.S. or foreign government sanctions are imposed on LEU from Russia or on TENEX, (ii) for any reason, TENEX is unable or unwilling to deliver LEU, receive payments, receive the return of natural uranium hexafluoride, or conduct other activities related to the TENEX Supply Contract, or (iii) TENEX elects, or is directed (including by its owner or the Russian government ), to limit or stop transactions with us or with the United States or other countries; risks related to disputes with third parties, including contractual counterparties, that could result if we are unable to receive timely deliveries of LEU under the TENEX Supply Contract; risks related to whether or when government funding or demand for high-assay low-enriched uranium ("HALEU") for government or commercial uses will materialize and at what level; risks regarding funding for continuation and deployment of the American Centrifuge technology; risks related to (i) our ability to perform and absorb costs under our agreement with the U.S. Department of Energy ("DOE") to deploy and operate a cascade of centrifuges to demonstrate production of HALEU for advanced reactors (the "HALEU Operation Contract"), (ii) our ability to obtain new contracts and funding to be able to continue operations and (iii) our ability to obtain and/or perform under other agreements; risks that (i) we may not obtain the full benefit of the HALEU Operation Contract and may not be able or allowed to operate the HALEU enrichment facility to produce HALEU after the completion of the HALEU Operation Contract or (ii) the output from the HALEU enrichment facility may not be available to us as a future source of supply; risks related to our dependence on others, such as TENEX, under the TENEX Supply Contract, a subsidiary of Orano Cycle ("Orano"), under our long-term commercial supply agreement with Orano and other suppliers (including, but not limited to, transporters) who provide, or deliver, us the goods and services we need to conduct our business; risks related to natural and other disasters, including the continued impact of the March 2011 earthquake and tsunami in Japan on the nuclear industry and on our business, results of operations and prospects; risks related to financial difficulties experienced by customers or suppliers, including possible bankruptcies, insolvencies, or any other situation, event or occurrence that affect the ability of others to pay for our products or services in a timely manner or at all; risks related to pandemics, endemics, and other health crises; risks related to the impact and potential extended duration of a supply/demand imbalance in the market for LEU; risks related to our ability to sell or deliver the LEU we procure pursuant to our purchase obligations under our supply agreements and the impacts of sanctions or limitations on imports of such LEU, including those imposed under the 1992 Russian Suspension Agreement as amended, international trade legislation and other international trade restrictions; risks related to existing or new trade barriers and to contract terms that limit our ability to procure LEU for, or deliver LEU to customers; risks related to pricing trends and demand in the uranium and enrichment markets and their impact on our profitability; risks related to the movement and timing of customer orders; risks related to the fact that we face significant competition from major LEU producers who may be less cost sensitive or are wholly or partially government owned; risks that our ability to compete in foreign markets may be limited for various reasons; risks related to the fact that our revenue is largely dependent on our largest customers; risks related to our backlog, including ...