Yellow Cake Plc · LSE:YCA
Yellow Cake — Investor Presentation (December 2023)
31 slides from Yellow Cake's investor presentation, December 2023
Slide 1: Pure Exposure to the Uranium Commodity – Investor Presentation December 2023
PURE EXPOSURE TO THE URANIUM COMMODITY INVESTOR PRESENTATION December 2023
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$100m of U3O8 from Kazatomprom volume, at the spot price per year Inventory stored
Slide 4: Uranium market update
Uranium market update November 2023 Spot Market Overview(1) ▪ Activity in the global spot market increased slightly during November with UxC reporting a total of 4.9Mlbs. transacted as compared to 4.5Mlbs. during October 2023. Total spot market volume for the year now stands at 53.0Mlbs. ▪ While spo
Slide 5: Uranium market update
Uranium market update November 2023 Kazatomprom(1) ▪ Kazatomprom released its 3Q23 Operations and Trading Update, which reported a slight decline in Kazakh uranium production for the first nine months of the year (2023 – 39.8Mlbs. compared to 2022 – 40.2Mlbs), but reconfirming the 2023 guidance at 5
Slide 6: Uranium market update
Uranium market update November 2023 The Philippines / The U.S.(1) ▪ The United States and the Philippines executed a 123 Agreement addressing nuclear cooperation between the two countries. The Philippine government has committed to pursuing nuclear power especially SMRs within the country as peak en
Slide 7: Proforma net asset value as at December 2023
Proforma net asset value as at 11 December 2023 Investment in Uranium Units Uranium oxide in concentrates (“U₃O₈”)(1) (A) lbs. 21,682,318 U₃O₈ fair value per pound(2) (B) US$ /lb. 82.30 U₃O₈ fair value (A) x (B) = (C) US$ mm 1,784.5 Cash and other net current assets / (liabilities)(3) (D) US$ mm 33.
Slide 8: Yellow Cake corporate summary
Yellow Cake corporate summary Corporate overview GBP share price and uranium price L12M(1,3) Last share price(1) £5.95 90 8.00 NAV per share(2) £6.68 80 7.00 70 Market cap (mm)(1) £1,290.3 6.00 Uranium Spot Price (US$/lb.) Yellow Cake Share Price (£) Shares outstanding less those held 60 216.9 5.00
Slide 9: U3O8 spot price has recovered to levels at the time of the Fukushima accident
U3O8 spot price has recovered to levels at the time of the Fukushima accident(1,2) Current spot price 90 11 December 2023 Fukushima accident (Spot US$82.30) 11 March 2011 (Spot US$68.08) 80 70 SPUT completes UPC acquisition 19 July 2021 (Spot US$32.41) 60 U3O8 Spot Price (US$ /lb.) Yellow Cake IPO 5
Slide 10: Decarbonisation
Decarbonisation Climate change and energy transition supporting nuclear growth 9
Slide 11: Climate change and energy transition supporting nuclear growth
Climate change and energy transition supporting nuclear growth Nuclear power generates the least CO2 equivalent emissions compared to all other power sources CO2 equivalent emissions per GWh over the lifecycle of a power plant (tonnes)(1) 720 820 490 78-230 34 3 4 5 Nuclear Wind Solar Hydropower Bio
Slide 12: Global demand for nuclear increasing towards 2050
Global demand for nuclear increasing towards 2050 Market conditions and policies are shifting views on natural gas and limiting its role, while underlining the potential for nuclear power to cut emissions and strengthen electricity security(1) Global nuclear energy demand scenarios (GW)(1) 1,000 800
Slide 13: Uranium demand growth
Uranium demand growth Reactor build programs, life extensions, and small modular reactor developments 12
Slide 14: Reactor build programs and life extensions driving uranium demand
Reactor build programs and life extensions driving uranium demand Global nuclear reactor fleet will continue to grow, especially in China, India, and the Middle East China India Russia UAE 26 reactors 8 reactors 3 reactors 3 operating reactors, under construction, under construction, under construct
Slide 15: Countries re-engaging nuclear power
Countries re-engaging nuclear power Rather than declining, western demand for nuclear power is stable to growing through reactor life extensions and new construction ▪ Five operating reactors with another planned, will take nuclear contribution to 60% ▪ On 16 February, Finland’s government issued op
Slide 16: Small modular reactors are becoming a reality
Small modular reactors are becoming a reality SMR market value could reach US$1 trillion by 2050 76 SMR designs are being developed globally across 18 countries(1) Early Stage Middle Stage Final Stage Finished Stage 18 16 14 12 10 8 6 4 2 -- Source: 1) Barclays Research, European Utilities – “New Ho
Slide 17: Energy security
Energy security Energy independence and security of energy supply now becoming increasingly important 16
Slide 18: Energy independence and security of energy supply now becoming increasingly important
Energy independence and security of energy supply now becoming increasingly important 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 3
Slide 19: Impact of the Russian invasion of Ukraine
Impact of the Russian invasion of Ukraine ▪ Western nuclear utility dependency on Russian nuclear fuel highlighted ▪ Sanctions have to date not yet been imposed on Russian nuclear fuel, but growing number of nuclear utilities are “self sanctioning” ▪ “Deglobalisation” of the nuclear fuel market, wit
Slide 20: Global utilities are exposed to escalating geopolitical risk of natural uranium supply
Global utilities are exposed to escalating geopolitical risk of natural uranium supply The United States, the largest consuming country, is currently at its lowest annual uranium production level in more than 70 years. Domestic suppliers are generally idled and commercial inventory is decreasing Tot
Slide 21: Contracting
Contracting Long term contracting has increased significantly, but is not yet close to replacement levels 20
Slide 22: Long-term contracts are being replaced
Long-term contracts are being replaced Increased term contracting activity during 2022 was one factor leading to the spot price rise Future contracted coverage rates of US and European utilities(1,2) 140% 125% 120% 113% 108% 100% 95% 90% 88% 75% 76% 80% 70% 75% 62% 62% 70% 60% 40% 45% 37% 20% 29% 10
Slide 23: Unfilled uranium requirements
Unfilled uranium requirements United States / European Union / Japan (31 Dec 2021)(1) 45 40 35 30 25 Mlbs. U3O8 20 15 10 5 -- 2022 2023 2024 2025 2026 2027 2028 2029 2030 United States European Union Japan Source: 1) USDOE-EIA / Euratom/ TradeTech 22
Slide 24: Long term contracting has increased significantly, but is not yet at replacement levels
Long term contracting has increased significantly, but is not yet at replacement levels ▪ Term contracting identified for 2023 has already exceeded the total for 2022 Term market buying trend - 2023(1) 180 160.1 160 140 125.0 Mlbs. U3O8 120 100 95.8 89.9 80 71.8 60 53.0 40 20 -- 2018 2019 2020 2021
Slide 25: Supply
Supply The supply side is being challenged to meet growing demand 24
Slide 26: 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 company Production by country(1) (Mlbs. U3O8, 2022) (%, 2022) 45.0% 42.4% Kazatomprom 30.5 40.0% Orano 14.6 35.0% Cameco 13.7 30.0% U
Slide 27: Declining secondary supply
Declining secondary supply Secondary supply is expected to decline by 4% p.a. until 2033 due to decreases of available excess enrichment capacity Secondary uranium supplies, 2013-2033 (Mlbs. U3O8) (1) 60 HEU Tails Re-Enrichment / Underfeeding MOX/RepU 50 (9)% p.a. 40 30 (4)% p.a. 20 10 -- 2013 2017
Slide 28: Supply / demand balance
Supply / demand balance There is a growing supply deficit 27
Slide 29: The supply side is being challenged to meet growing demand
The supply side is being challenged to meet growing demand(1) 250 200 Uranium Price (US$/lb.) 150 100 50 -- 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 P
Slide 30: Summary
‘YELLOW CAKEPLC Summary 29
Slide 31: Yellow Cake is well positioned to benefit from current market trends
Yellow cake is well positioned to benefit from current market trends ▪ Nuclear energy provides low emission power generation that is critical to decarbonisation ▪ Globally, demand for uranium is increasing due to aggressive nuclear plant build programs, reactor life extensions, and small modular rea