Yellow Cake Plc · LSE:YCA
Yellow Cake — Investor Presentation (August 2021)
20 slides from Yellow Cake's investor presentation, August 2021
Slide 1: Investor Presentation: Pure Exposure to the Uranium Commodity
PURE EXPOSURE TO THE URANIUM COMMODITY INVESTOR PRESENTATION August 2021
Slide 2: Disclaimer
Disclaimer This presentation (the “Presentation”) is provided on a strictly Requirements, Exemptions and Ongoing Registrant Recipients of this Presentation are not to construe its private and confidential basis for information purposes only Obligations; (D) in Australia, are sophisticated investors
Slide 3: Yellow Cake
Yellow Cake Strategy Industry Context Investment Highlights To buy and hold physical uranium Steady uranium demand and to deliver maximum exposure growth from nuclear reactor Holds physical U₃O₈ to the expected resurgence in the build programme uranium market No exposure to exploration, Sustained lo
Slide 4: Uranium market update
Uranium market update July 2021 Spot Market Overview ▪ The UxC U3O8 price strengthened reaching US$32.30 /lb at the end of July, an increase from the previous month’s spot price of US$32.10 /lb(1) ▪ Near-term uranium demand in July rose to 6.6 Mlb U3O8 with approximately 48 Mlb (YTD) transacted in t
Slide 5: Uranium market update
Uranium market update July 2021 Cameco ▪ Cameco reported (28 July 2021, Q2 Result Conference Call) Cigar Lake production could be as much as 12.0 Mlb in 2021 (subject to any further disruptions due to Covid-19 or forest fires in the area) with Cameco receiving “up to 6 Mlb” ▪ Regarding 2021 market p
Slide 6: Uranium market update
Uranium market update July 2021 Euratom Supply Agency (ESA) ▪ The Euratom Supply Agency (ESA) released it’s “Annual Report – 2020” (2 July, 2021) which documents nuclear fuel activities by the commercial nuclear power industry within the European Union and the United Kingdom ▪ Gross uranium requirem
Slide 7: Estimated net asset value
Estimated net asset value On 13 August, the ordinary shares of Yellow Cake closed on the LSE at a value of GBP 2.61 per share, which represents a 9% premium to the net asset value of GBP 2.39 per share. Investment in Uranium Units Uranium oxide in concentrates (“U₃O₈”)(1) (A) lb 13,855,601 U₃O₈ fair
Slide 8: Yellow Cake corporate summary
Yellow Cake corporate summary Corporate overview GBP share price and uranium price(1,3) Last share price(1) £2.61 $35 £2.90 NAV per share(2) £2.39 $34 £2.70 Market cap (mm)(1) £400 $33 Share Price (GBp /sh) Uranium Price (USD/lb) £2.50 $32 Shares out. (mm) 153.6 £2.30 $31 Shares held in treasury (mm
Slide 9: Strategic relationship with Kazatomprom allows for value accretive growth
Strategic relationship with Kazatomprom allows for value accretive growth Option Agreement with Kazatomprom, the world’s largest and lowest cost producer(1) ▪ 10-year Framework Agreement with Kazatomprom ▪ Yellow Cake has the right to purchase up to US$100m of U₃O₈ annually ▪ Term of the option agre
Slide 10: 2020 was a transition year for the uranium market
2020 was a transition year for the uranium market Uranium market impacts ▪ COVID-19 pandemic highlighted the supply side vulnerability ▪ Nuclear energy demonstrated its resilience as a reliable, low-cost electricity supply source ▪ US policy issues overhanging the market were resolved ▪ A number of
Slide 11: Investor interest in uranium equities increased significantly since Q4 2020
Investor interest in uranium equities increased significantly since Q4 2020 Uranium Equities Performance – LTM(1) – Global X Uranium ETF v Uranium spot price 140.00% 120.00% 100.00% 80.00% 60.00% 40.00% 20.00% 0.00% ( -20.00% ) October 2020 November 2020 December 2020 January 2021 February 2021 Marc
Slide 12: Yellow Cake raises c.US$225 m in H1-2021 on the back of strong investor demand
Yellow Cake raises c.US$225 m in H1-2021 on the back of strong investor demand June 2021 – US$86.9m Equity Raise ▪ Issued 25 million new ordinary shares at a price of £2.50 per share ▪ Raised gross proceeds of £62.5 million (approximately US$86.9 million) ▪ Proceeds partly applied to acquire a furth
Slide 13: Yellow Cake has seen a significant increase in trading volumes since February 2021
Yellow Cake has seen a significant increase in trading volumes since February 2021 ▪ Main drivers for the increase are: - Increased number of shares on issue and increased market capitalisation - Increased retail volume - Significant improvements in the uranium market sentiment 500 14.0 US$140m fund
Slide 14: Nuclear is a key element of global energy supply
Nuclear is a key element of global energy supply One of the lowest sources Lowest non-carbon of carbon emissions operating cost per mWh(1) per mWh Nuclear energy provides Nuclear energy reliable baseload power is sustainable Nuclear is increasingly being Growing interest in recognised as a contribut
Slide 15: Future demand
Future demand Global nuclear reactor fleet will continue to grow, especially in China, India and the Middle East China India Russia UAE 18 reactors 7 reactors 2 reactors 3 reactors under construction, under construction, under construction, under construction 37 planned 14 planned 25 planned Operabl
Slide 16: Increasing commitments to carbon neutrality includes nuclear
Increasing commitments to carbon neutrality includes nuclear Commitments to carbon neutrality(1) ▪ Canada – 2050 ▪ China – 2060 ▪ European Union – 2050 ▪ France – 2050 ▪ Japan – 2050 ▪ United Kingdom – 2050 ▪ U.S.A. – 2050 Carbon Free Energy Initiatives ▪ United States of America officially re-joine
Slide 17: Growing interest in small Modular Reactors
Growing interest in small Modular Reactors ▪ SMR’s generate up to 300MW of electricity and are Feedwater line(2) more flexible and more affordable than large Steam line reactors(1) Containment vessel ▪ SMR’s are ideal for smaller grids and remote locations Pressuriser ▪ Across 9 countries there are
Slide 18: Long-term contracts need to be replaced
Long-term contracts need to be replaced Contract covering has the potential to create a rapid tightening of the spot market Future contracted coverage rates of US and European utilities 140% 116% 120% 103% 104% 99% 100% 93% 98% 80% 71% 84% 70% 67% 72% 57% 60% 61% 55% 40% 42% 39% 20% 21% 14% 0% 2021
Slide 19: Global supply cuts
Global supply cuts Producers have made significant production cuts, exacerbated by COVID-19 Production cuts seen from 2016(1) 180 World U3O8 mining production (mlb) 150 120 90 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 (2) Source 1) World Nuclear Association, World Uranium Mining Pr
Slide 20: Growing mine supply gap
Growing mine supply gap Underinvestment in exploration and development is leading to a potential future supply gap. The Reference market scenario incorporated in the latest WNA nuclear fuel market report shows an immediate global market supply deficit(1) Supply/demand imbalance (U₃O₈ tU) 120,000 100