Yellow Cake Plc · LSE:YCA
Yellow Cake — Investor Presentation (May 2024)
16 slides from Yellow Cake's investor presentation, May 2024
Slide 1: Investor presentation 2024
Investor presentation 2024
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: The resurgence of the uranium price is being driven by a number of key themes
THE RESURGENCE OF THE URANIUM PRICE IS BEING DRIVEN BY A NUMBER OF KEY THEMES 1. Energy transition and the drive towards carbon neutrality 2. The growth in the global nuclear reactor fleet 3. Energy independence and energy security 4. Historic under-investment in the supply side Commodity price tren
Slide 4: Yellow Cake
YELLOW CAKE Buy and hold strategy We purchase natural uranium (U3O8) 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 up to US$100m of U3O8 from volume, at the spot price Kazatomprom per y
Slide 5: Proforma net asset value as at May 2024
PROFORMA NET ASSET VALUE AS AT 13 MAY 2024 Investment in Uranium Units Uranium oxide in concentrates (“U₃O₈”)(1) (A) lbs. 21,682,318 U₃O₈ fair value per pound(2) (B) US$ /lb. 91.00 U₃O₈ fair value (A) x (B) = (C) US$ mm 1,973.1 Cash and other net current assets / (liabilities)(3) (D) US$ mm 30.1 Net
Slide 6: Yellow Cake has become the fourth largest company on AIM
YELLOW CAKE HAS BECOME THE FOURTH LARGEST COMPANY ON AIM Since IPO in 2018: ▪ The U3O8 spot price has increased c. 300% from US$22.85 /lb. to US$91.00 /lb.(1) ▪ YCA has raised over US$800m ▪ YCA has secured an inventory of 21.6Mlbs. U3O8 ▪ YCA has become the most liquid stock on the AIM segment of t
Slide 7: There is strong government and policy support for nuclear
THERE IS STRONG GOVERNMENT AND POLICY SUPPORT FOR NUCLEAR ▪ Around 100 countries have communicated net zero targets ▪ At COP28, over 20 countries committed to tripling nuclear energy by 2050 ▪ In the US, various legislative bills have provided significant financial incentives and support for the nuc
Slide 8: Electricity demand growth
ELECTRICITY DEMAND GROWTH ▪ Growth of the Middle Class in the developing economies ▪ Proliferation of new technologies in the developed economies – data centres, AI, streaming Global electricity demand by scenario (TWh)(1) 70,000 60,000 50,000 40,000 30,000 20,000 10,000 -- Stated Policy Scenario An
Slide 9: Small modular reactors will be a new source of demand
SMALL MODULAR REACTORS WILL BE A NEW SOURCE OF DEMAND SMR market value could reach US$1 trillion by 2050(1) ▪ More than 75 designs have been proposed globally ▪ Commercial operations are expected in the late 2020’s ▪ SMRs offer the versatility of both on-grid and off-grid applications ▪ SMRs can pro
Slide 10: Demand for uranium is expected to rise as nuclear capacity grows through 2035
DEMAND FOR URANIUM IS EXPECTED TO RISE AS NUCLEAR CAPACITY GROWS THROUGH 2035 Forecasted nuclear capacity 2022-2035(1) 600 300 550 250 Nuclear Capacity (GWe) 500 U308 Demand (Mlbs.) 200 450 400 150 350 100 300 50 250 200 - 2022a 2023e 2024e 2025e 2026e 2027e 2028e 2029e 2030e 2031e 2032e 2033e 2034e
Slide 11: Long-term contracts are being replaced
LONG-TERM CONTRACTS ARE BEING REPLACED European utilities have their uranium secured until the middle of the decade, while new contracts are required for the U.S. utilities Future contracted coverage rates of U.S. and European utilities(1,2) 160% 136% 140% 124% 121% 120% 103% 100% 90% 91% 89% 95% 80
Slide 12: Energy security now a key focus post Russia's invasion of Ukraine
ENERGY SECURITY NOW A KEY FOCUS POST RUSSIA’S INVASION OF UKRAINE ▪ Russia’s share of uranium supply – c.11% ▪ Russia’ share of conversion – c.35% ▪ Russia’s share of enrichment – c. 45% ▪ On 30 April 2024, the United States Senate unanimously passed “Prohibiting Russian Uranium Imports Act (H.R. 10
Slide 13: 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 14: The global uranium supply side is concentrated
THE GLOBAL URANIUM SUPPLY SIDE IS CONCENTRATED(1) ▪ The world is highly dependent on supply from Kazakhstan and Kazatomprom ▪ Nearly 80% of primary production is in the hands of state-owned enterprises ▪ Over 70% of supply comes from countries that consume little or no uranium Forecasted nuclear sup
Slide 15: The supply side is being challenged to meet growing demand
THE SUPPLY SIDE IS BEING CHALLENGED TO MEET GROWING DEMAND The widening supply gap will be exacerbated by long mine development timelines, supply chain challenges and capital cost inflation Forecasted nuclear supply by source 2022-2035 (Mlbs. U3O8)(1) 300 250 200 150 100 50 -- 2022a 2023e 2024e 2025
Slide 16: 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