News

Full Year 2022 Audited Results

08 March 2023

Robust response to a changing market drives strong cash generation and increased order book.

London – 9 March 2023 – Urenco Group (“Urenco”), an international supplier of uranium enrichment services and nuclear fuel cycle products, today announces its results for the full year ended 31 December 2022.

Summary

• Revenue increased to €1,716.5 million (2021: €1,669.3 million), reflecting increased SWU volumes sold and higher realised prices.
• EBITDA(i) declined to €824.6 million (€971.1 million in 2021) due to higher nuclear provisions and increased costs as the business repositions itself for growth opportunities.
• Pre-exceptional items, net income fell to €285.1 million (2021: €364.5 million). Net income post-exceptional items up at €1,173.2 million driven by non-cash reversal of previously recognised impairment charges of €888.1 million. 
• Net cash at 31 December 2022 of €627.2 million (2021: Net debt €11.5 million).
• Order book up by 24% since the start of the year to €10.8 billion.
• US Decommissioning Trust established and €482.1 million invested as of 31 December 2022.
• Sustainability highlights include: carbon emissions (scope 1&2) down overall by 25.4% against baseline year of 2019; enriched enough uranium to generate an estimated 780,000 GWh of electricity from nuclear power, avoiding c.320 million tonnes of carbon emissions.(ii)

Financial Highlights (€m)

	2022	2021
Revenue	1,716.5	1,669.3
EBITDA(i)	824.6	971.1
EBITDA margin %	48.0%	58.2%
Income from operating activities (pre-exceptional items)	443.8	635.8
Exceptional items (pre-tax)(ii)	921.4	-
Income from operating activities (post-exceptional items)	1365.2	635.8
Net income (pre-exceptional items)	285.1	364.5
Exceptional items (post-tax)(iii)	888.1	-
Net income (post-exceptional items)	1,173.2	364.5
Capital expenditure(iv)	184.0	142.3
Cash generated from operating activities	1,133.7	1,027.6
Net Cash/(Net debt)	627.2	(11.5)

(i) EBITDA is earnings before exceptional items, interest (including other finance costs), taxation, depreciation and amortisation and results from joint venture and other investments. Depreciation and amortisation are adjusted to remove elements of such charges included in changes to inventories and net costs of nuclear provisions. Further details on the calculation of EBITDA are set out in note 4 to the Group’s Consolidated Financial Statements contained in the Annual Report and Accounts.
(ii) As a proportion of the nuclear carbon offset as calculated by the International Energy Agency.
(iii) Exceptional items relate to the non-cash reversal of previously recognised impairment charges of the USA operations of €921.4 million pre-tax and €888.1 million post-tax.
(iv) Capital expenditure includes net cash flows on the purchases of property, plant and equipment and intangible assets of €166.6 million and on the decrease of capital accruals of €17.4 million (included in working capital payables).  Capital expenditure for the year ended 31 December 2021 has been represented from €129.8 million to €142.3 million and comprised net cash flows on the purchases of property, plant and equipment and intangible assets of €143.5 million and on the increase of capital accruals of €1.2 million (included in working capital payables).

Boris Schucht, Chief Executive of Urenco Group, commenting on the results, said:

“Urenco’s full year results for 2022 demonstrate our dedication and resilience in the face of geopolitical and economic uncertainty.   

The invasion of Ukraine has had repercussions around the world. In addition to the need to use low carbon technologies to combat climate change, there is now a focus on energy independence and security of energy supply. As a result, more countries are turning to nuclear or expanding their existing nuclear supply. This has led to visible growth in the long term demand for our enrichment services. We have responded by launching a programme to upgrade and potentially expand our enrichment capacity at all four of our sites. Price levels in the uranium enrichment market are becoming more sustainable, which will facilitate long term investment in our business, underwritten by long term customer contracts. This has also resulted in the reversal of impairments recorded in previous years against our US facility.

Urenco’s finances remain strong. Our order book has grown by 24% due to increased long term demand and price levels. Revenue of €1,716.5 million is up on 2021 (€1,669.3 million), primarily driven by increased demand. EBITDA of €824.6 million is down from 2021 (€971.1 million) due to increased short term costs as the business repositions itself for current and future growth opportunities. Pre-exceptional items, which in the year related entirely to a one-time non-cash post-tax reversal of a previous impairment charge of €888.1 million, net income fell to €285.1 million (2021: €364.5million). We retain a strong balance sheet, with net cash of €627.2 million at the end of December 2022 (2021: Net debt €11.5 million).  

We are currently planning for investment in our uranium enrichment capacity, while developing advanced fuels to serve the future demand of our customers. We are also enhancing our associated services in stable isotopes production and responsible management of nuclear materials. This includes continuing to ramp up production at our Tails Management Facility, which converts tails - the by-product of our enrichment services - to uranium oxide ready for long term storage or disposal.

Climate change remains at the forefront of energy challenges worldwide. We play a key part in providing low carbon fuel for nuclear power generators and within our business we have accelerated our own net zero transition, bringing forward our targets and working with wider industry to help others to decarbonise. Our ambition is to offer carbon free nuclear fuel production and related services to our customers no later than 2040.”

Sustainability and decarbonisation

We were the first commercial nuclear organisation to sign the Climate Pledge in 2020. As such, we are increasing our efforts to reach net zero in our scope 1, direct, and scope 2, indirect, emissions by 2030 and within our supply chain by 2040. We are ensuring our direct suppliers are independently assessed to help us reach these targets and we are also collaborating with our customers and their suppliers to help them reach their own carbon reduction objectives. This will help to make nuclear a fully carbon free energy source for society.

This year we have been recognised by the Science Based Target Initiative (SBTi) for taking action to reduce carbon emissions. Our annual Carbon Disclosure Project performance has improved to B from B-. We also joined the World Business Council for Sustainable Development (WBCSD) to help us impact global corporate sustainability.

Our sustainability performance remains steady. Our scope 1 and 2 carbon emissions decreased by 25.4% when compared to our baseline year of 2019. However, they increased by 4.8% compared to 2021 due to higher carbon intensities of electricity supplies to our sites in the Netherlands and Germany. These were affected by variations in the renewable and fossil fuel mix available in the public supply.  Natural gas and refrigerants make up the majority of our scope 1 emissions and we are utilising the skills and expertise within Urenco to develop innovative solutions to drive them down. It is our goal to have carbon free electricity at all of our sites by 2030.

We have reduced our water usage by 12.2% against our baseline year of 2020. We enriched enough uranium to generate an estimated 780,000 GWh of electricity from nuclear power, avoiding approximately 320 million tonnes of carbon emissions[1]. In addition, we met 100% of customer deliveries, and the volume of our annual stable isotopes sales equate to approximately two million patient treatments being performed in the medical sector.

Outlook and Order Book

We are a unique uranium enrichment company and due to our international diversity we offer security of supply to our customers. We have enrichment facilities in four countries and our operations are underpinned by robust international treaty commitments on nuclear safeguards and non-proliferation.

SWU spot prices are increasing. From their low point of US$34/SWU in August 2018, they have been on an upward trajectory with a recent steep increase reaching US$125/SWU by the end of December 2022, as reported by UxC. We are signing new contracts and amending existing contracts, maintaining our customer base and raising our profile in new markets. We have long term visibility in our order book, extending into the 2030s. Our order book value as of 31 December 2022 was €10.8 billion, based on €/$ of 1 : 1.07 (31 December 2021: €8.7 billion based on €/$ of 1 : 1.14).

We are optimistic about the prospects for our core enrichment business as the market looks to low carbon and carbon free technologies alongside prioritising security of supply. There are also significant opportunities in the market for advanced fuels and stable isotopes which we believe we are well positioned to offer.

-- ENDS --

The Full Year 2022 Audited Financial Results are available on the Urenco website

Contact
Rebecca Astles
Interim Head of Communications
+44 1753 660 660

Benedict Guilfoyle
Madano +44 (0) 7771 241 358
Benedict.Guilfoyle@madano.com
urenco@madano.com

About Urenco Group

Urenco is an international supplier of enrichment services and fuel cycle products with sustainability at the core of its business. Operating in a pivotal area of the nuclear fuel supply chain for more than 50 years, Urenco facilitates zero carbon electricity generation for consumers around the world.

With its head office near London, UK, Urenco’s global presence ensures diversity and security of supply for customers through enrichment facilities in Germany, the Netherlands, the UK and the USA. Using centrifuge technology designed and developed by Urenco, and through the expertise of our people, the Urenco Group provides safe, cost effective and reliable services, operating within a framework of high environmental, social and governance standards, complementing international safeguards.

Urenco is committed to continued investment in the responsible management of nuclear materials; innovation activities with clear sustainability benefits, such as nuclear medicine, industrial efficiency and research; and nurturing the next generation of scientists and engineers.

Visit www.urenco.com

Disclaimer

This press release is not intended to be read as the Group’s statutory accounts as defined in section 435 of the Companies Act 2006. Information contained in this release is based on the 2022 Consolidated Financial Statements of the Urenco Group, which were authorised for issue by the Board of Directors on 8 March 2023. The auditor's report on the 2022 Consolidated Financial Statements of the Group was unqualified and did not contain a statement under section 498 of the Companies Act 2006. The Group's 2021 statutory accounts have been delivered to the registrar of companies.

This release and the information contained within it does not constitute an offering of securities or otherwise constitute an invitation or inducement to underwrite, subscribe for or otherwise acquire securities in any company within the Urenco Group.

Any forward-looking statements contained within this release are inherently subject to risks and uncertainties. Actual results may differ materially from those expressed or implied by such forward-looking statements and, accordingly, any person reviewing this release should not rely on such forward-looking statements.

[1] As a proportion of the nuclear carbon offset as calculated by the International Energy Agency.