Fuel Services
(Includes results for UF6, UO2 and fuel fabrication)
| Highlights | 2012 | 2011 | Change |
|---|---|---|---|
| Production volume (million kgU) | 14.2 | 14.7 | (3)% |
| Sales volume (million kgU) | 16.1 | 18.3 | (12)% |
| Realized price ($Cdn/kgU) | 17.24 | 16.71 | 3% |
| Average unit cost of sales ($Cdn/kgU) (including D&A) | 14.63 | 13.75 | 6% |
| Revenue ($ millions) | 277 | 305 | (9)% |
| Gross profit ($ millions) | 42 | 54 | (22)% |
| Gross profit (%) | 15 | 18 | (17)% |
Total revenue decreased by 9% due to a 12% decrease in sales volumes. We set a lower sales target in 2012 due to weak market conditions at the beginning of the year.
The total cost of products and services sold (including D&A) decreased by 6% ($235 million compared to $251 million in 2011) due to the decrease in sales volumes. The average unit cost of sales was 6% higher due to higher unit costs for UF6 relating to lower production.
The net effect was a $12 million decrease in gross profit.
Outlook For 2013
In 2013, we plan to produce 15 million to 16 million kgU1, and we expect sales volumes to be up to 5% higher than in 2012. Overall revenue is expected to increase by 5% to 10%, as a result of the higher volumes and an expected increase in the average realized price. We expect the unit cost of product sold (including D&A) to decrease by 0% to 5%; therefore, overall gross profit will increase as a result.
1Outlook corrected from 14 million to 15 million KgU on February 19, 2013 to match the Port Hope 2013 production target.