Yellow Cake Plc · LSE:YCA
Yellow Cake — Investor Presentation (July 2022)
20 slides from Yellow Cake's investor presentation, July 2022
Slide 1: Pure Exposure to the Uranium Commodity
PURE EXPOSURE TO THE URANIUM COMMODITY INVESTOR PRESENTATION July 2022
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 Buy and hold strategy We purchase uranium and hold for the long-term Pure exposure to the No exploration, development or operating risk uranium commodity price Ability to purchase in Ability to purchase US$100m of U3O8 from Kazatomprom volume, at the spot price per year Inventory stored
Slide 4: Uranium market update
Uranium market update June 2022 Spot Market Overview1 ▪ The Ux U3O8 spot price finished June at $49.00/lb., an increase of $2.00/lb. over the end of May level ($47.00/lb.). Daily price volatility remained high with the daily price reaching $52.00/lb. on 9 June and a low point of $45.50/lb. on 20 Jun
Slide 5: Uranium market update
Uranium market update June 2022 European Union1 ▪ The European Parliament voted to reject objections to the inclusion of natural gas and nuclear power in its taxonomy plan which had been subjected to extensive debate since late 2021. A majority (353) of MEPs voted against the effort to block the inc
Slide 6: Uranium market update
Uranium market update June 2022 International Energy Agency (IEA)1 ▪ The International Energy Agency (IEA) published its latest analysis of the potential role of nuclear energy for the global transition away from fossil fuels to generate electricity. “Nuclear Power and Secure Energy Transitions” pro
Slide 7: Uranium market update
Uranium market update June 2022 United States1 ▪ In a blog posted 16 June 2022, John Kotek, Senior Vice President, Policy Development and Public Affairs at the Nuclear Energy Institute in Washington DC, set forth the need for secure nuclear fuel sources in the face of the Russian-Ukraine conflict. K
Slide 8: Proforma estimated net asset value as at 7 July 2022
Proforma estimated net asset value as at 7 July 2022 Investment in Uranium Units Uranium oxide in concentrates (“U₃O₈”) (A) lb 18,805,601 U₃O₈ fair value per pound(1) (B) US$ /lb 47.75 U₃O₈ fair value (A) x (B) = (C) US$ mm 898.0 Cash and other net current assets / (liabilities)(2) (D) US$ mm 16.6 N
Slide 9: Yellow Cake corporate summary
Yellow Cake corporate summary Corporate overview GBP share price and uranium price(1,3) Last share price(1) £3.43 70 6.00 NAV per share(2) £4.16 60 5.00 Market cap (mm)(1) £627 Uranium Spot Price (US$/lb.) 50 Yellow Cake Share Price (£) Shares out less those held in 4.00 183.1 treasury (mm) 40 Share
Slide 10: The Uranium Story is Becoming Increasingly Compelling
The Uranium Story is Becoming Increasingly Compelling ➢ Nuclear is being recognised as a contributor to a lower carbon future ▪ Provides stable, low carbon baseload power ▪ Broad adoption of carbon neutral goals ➢ High costs of energy infrastructure construction encourages life extensions for existi
Slide 11: Nuclear as a Cornerstone of a Low-Carbon Future
Nuclear as a Cornerstone of a Low-Carbon Future Tonnes of CO2 Emitted by the Power Generation Sector (1) 6,000 5,238 5,000 CO2 per Year (Mt) 4,000 3,000 2,000 1,699 1,173 1,000 506 317 239 137 134 98 72 65 37 -- China United India Japan South Germany Poland Turkey Egypt United Brazil France States K
Slide 12: Future demand for uranium is growing
Future demand for uranium is growing Global nuclear reactor fleet will continue to grow, especially in China, India and the Middle East China India Russia UAE 19 reactors 8 reactors 3 reactors 2 operating reactors, under construction, under construction, under construction, 2 reactors under 33 plann
Slide 13: Small Modular Reactors: An Exciting New Source of Demand
Small Modular Reactors An Exciting New Source of Demand Total Capacity of Small Modular Reactors Under Design, Construction, or Operation (1) 3,500 3,186 3,000 2,723 2,500 2,250 Capacity (MW) 2,000 1,500 1,331 1,094 1,000 595 447 500 340 -- United States Russia RoW / China Japan Canada United France
Slide 14: Broad Based Impetus to Protect Existing Nuclear Capacity
Broad Based Impetus to Protect Existing Nuclear Capacity Selected Recent Reactor Extension Activity (1) Previously set to shut down in 2025, both Doel 4 and Tihange 3 have been approved to continue operations until 2035 by the Federal Agency for Nuclear Control Fortum is seeking an extension on both
Slide 15: Global Uranium Supply Side is Concentrated
Global Uranium Supply Side is Concentrated U3O8 Production is Concentrated, with the Top 5 Companies Producing 59% of the Total Supply in 2021(1) Global production by mine Production by Country (1) (mlb U3O8, 2021) (%, 2021) 50.0% Cigar 12.2 31.4 44.7% Cigar LakeLake Kazatomprom 45.0% Husab Husab Or
Slide 16: Uranium supply-demand balance
Uranium supply-demand balance 250.0 200.0 Uranium Price (US$/lb) 150.0 100.0 50.0 0.0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 Secondary supply Operation Closed Operation Operation On Hold Probable Project Demand Source:
Slide 17: 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 18: Utilities are Returning to the Term Market
Utilities are Returning to the Term Market Long-term Contracting Activity Accelerates After Years of Moderate Commitments Term Market Buying Trend - 2022 (1) 163.0 - Annualised 160 120 95.8 89.9 Mlb U3O8 80 71.8 67.9 53.0 40 -- 2018 2019 2020 2021 2022 YTD Source: 1) UxC Weekly Vol 33 No 1; Vol 34 N
Slide 19: Capacity Constraints Impacting the Front-End of the Nuclear Fuel Cycle
Capacity Constraints Impacting the Front-End of the Nuclear Fuel Cycle Russia is a Key Player in Both Conversion and Enrichment Front-End Nuclear Cycle Overview (1) Mining Conversion Enrichment Fuel Fabrication Global Conversion Capacity (2) Global Enrichment Capacity (3) 16.0 15 15 30.0 27.7 14.0 1
Slide 20: Market Price Movements in Conversion and Enrichment
Market Price Movements in Conversion and Enrichment Conversion and SWU Price Increases - L12M (1) 70% US$87.0 60% US$82.0 US$84.0 US$80.0 US$32.0 50% US$30.3 40% US$27.5 30% US$26.0 % Change 20% US$60.0 10% US$58.0 US$55.5 US$55.5 US$56.0 US$56.0 US$56.0 US$54.0 US$54.5 -- US$19.5 US$19.3 US$19.0 (1