Yellow Cake Plc · LSE:YCA
Yellow Cake — Investor Presentation (October 2022)
21 slides from Yellow Cake's investor presentation, October 2022
Slide 1: Pure Exposure to the Uranium Commodity
PURE EXPOSURE TO THE URANIUM COMMODITY INVESTOR PRESENTATION October 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$100m of U3O8 from Kazatomprom volume, at the spot price per year Inventory stored
Slide 4: Uranium market update
Uranium market update September 2022 Spot Market Overview1 ▪ Activity in the spot market showed a slight improvement during September as volume rose from August’s level of less than one million lbs. up to 3.6 million lbs. This brings the total for CY2022 to 46.9 million lbs., well off the total purc
Slide 5: Uranium market update
Uranium market update September 2022 The United Nations1 ▪ The United Nations Economic Commission for Europe (“UNECE”) released a study of the impacts of climate change (“Roadmap to Carbon Neutrality for Europe, North America and Central Asia”). The report identifies a range of technology and policy
Slide 6: Uranium market update
Uranium market update September 2022 Germany1 ▪ Germany has taken the decision to maintain operations at the country’s three remaining reactors; The Emsland, Isar-2, and Neckarwestheim-2, until mid-April 2023, rather than shut-down and decommission the units which had been slated for December 2022.
Slide 7: Estimated net asset value as at 21 October 2022
Estimated net asset value as at 21 October 2022 Investment in Uranium Units Uranium oxide in concentrates (“U₃O₈”) (A) lb 18,805,601 U₃O₈ fair value per pound (1) (B) US$ /lb 52.50 U₃O₈ fair value (A) x (B) = (C) US$ mm 987.3 Cash and other net current assets / (liabilities) (2) (D) US$ mm 14.8 Net
Slide 8: Yellow Cake corporate summary
Yellow Cake corporate summary Corporate overview GBP share price and uranium price(1,3) Last share price(1) £4.32 70 6.00 NAV per share(2) £4.92 60 5.00 Market cap (mm)(1) £791.4 Uranium Spot Price (US$/lb.) 50 Yellow Cake Share Price (£) Shares out less those held in 4.00 183.1 treasury (mm) 40 Sha
Slide 9: 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 10: 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 11: 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 22 reactors 8 reactors 3 reactors 3 operating reactors, under construction, under construction, under construction, 1 reactors under 38 plan
Slide 12: 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 13: 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 14: 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 15: 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 16: 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 17: Unfilled Uranium Requirements
Unfilled Uranium Requirements – United States / European Union / Japan (31 Dec 2021) 45 40 35 30 25 Mlbs U3O8 20 15 10 5 0 2022 2023 2024 2025 2026 2027 2028 2029 2030 United States European Union Japan Source: 16 1) USDOE-EIA / Euratom/ TradeTech
Slide 18: Utilities are Returning to the Term Market
Utilities are Returning to the Term Market Term Contracting Volume ➢ 2022 term contracting volume of 85.0 million lbs. to 17 October as compared to 52.6 million lbs. in the same period for 2021 ▪ Annual term contracting volume averaged 73 Mlbs./year 2013-2021 ➢ Junior Producer Contracting (ex. Camec
Slide 19: Impacts of Russian Invasion of Ukraine
Impacts of Russian Invasion of Ukraine ➢ Western Nuclear Utility Dependency on Russian Nuclear Fuel ➢ Political / Economic Sanctions ➢ Utility “Self Sanctioning” ➢ “Deglobalization” of Nuclear Fuel Market ▪ Russian nuclear fuel deliveries to the EU since 1975 and the U.S. since 1980 ➢ Initial Utilit
Slide 20: 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 21: Market Price Movements in Conversion and Enrichment
Market Price Movements in Conversion and Enrichment Conversion and SWU Price Increases - L12M (1) 160% 140% US$38.0 US$38.0 US$37.0 120% US$32.0 100% US$30.3 US$27.5 80% % Change US$26.0 60% US$90.0 US$92.0 US$89.5 US$87.0 US$84.0 40% US$82.0 US$60.0 US$80.0 20% US$58.0 US$55.5 US$56.0 US$56.0 US$56