What Centrus Energy (LEU) Said on Its Q3 Earnings Call

Key Points

• Third-quarter results weakened: Revenue fell 26% year over year to $55.5 million, and Centrus reported a normalized net loss of $10.2 million, versus net income a year earlier.
• Enrichment demand and expansion advanced: Total backlog reached $7 billion, including $5.4 billion in contingent LEU and HALEU commitments. Centrus began commercial HALEU production using its demonstration cascade and completed its first newly manufactured centrifuge.
• Guidance was reaffirmed: Centrus maintained its 2026 revenue outlook of $450 million to $500 million and capital-spending guidance of $350 million to $500 million. It ended the quarter with about $2.2 billion in unrestricted cash and said it would provide more expansion details at its Dec. 7 investor day.

Centrus Energy NYSE: LEU reported lower third-quarter revenue and a normalized net loss as it advanced its uranium enrichment expansion, completed its first newly manufactured centrifuge and began producing high-assay low-enriched uranium for commercial use.

On its Nov. 5 earnings call, the company said its enrichment backlog rose to $5.4 billion in contingent sales commitments, up from $3 billion. Centrus reaffirmed its full-year revenue and capital spending guidance and said it expects to provide more details about its expansion at an investor day on Dec. 7.

Quarterly revenue falls

Third-quarter revenue declined 26% from a year earlier to $55.5 million. The low-enriched uranium, or LEU, segment generated $31.8 million, down 29%, while Technical Solutions revenue fell 21% to $23.7 million. Chief Financial Officer Todd Tinelli said the Technical Solutions decline was primarily due to lower revenue under the company’s HALEU operation contract and changes related to other contracts.

Centrus posted a third-quarter gross loss of $10.6 million, compared with a $4.3 million gross loss a year earlier. Its normalized net loss was $10.2 million, or 49 cents per diluted share, compared with normalized net income of $3.9 million, or 19 cents per diluted share, in the prior-year quarter.

The normalized figures exclude a $46.4 million noncash gain from a decrease in the liability associated with warrants issued in a recent capital raise. Tinelli said the gain boosted operating income and net income but was not part of the company’s ordinary course of business.

Asked about the fourth-quarter margin outlook, Tinelli pointed to fluctuations in the timing of product receipts and customer deliveries. He said Centrus remained confident in its full-year outlook but did not provide a specific gross-margin forecast.

Commercial HALEU production begins

Centrus is using its existing 16-centrifuge demonstration cascade to enrich high-assay low-enriched uranium, or HALEU, for the commercial market. Tinelli said the Department of Energy has given the company rights to use the centrifuges commercially and that the parties are working on a longer-term arrangement.

CEO Amir Vexler did not identify which customer would receive the material or specify when commercial HALEU revenue would be recognized. Tinelli declined to discuss contract margins, saying terms and feedstock arrangements vary by agreement.

Vexler said Centrus remains primarily focused on LEU demand from established nuclear utilities, while seeing advanced reactors and national security as additional opportunities. He said reactor developers are making stronger commitments to secure fuel but that he has not seen them pull demand forward enough to change the company’s planned capacity rollout.

Total backlog across both segments reached $7 billion and extends through 2040, according to Tinelli. Of the $5.4 billion in contingent LEU and HALEU commitments, $5.1 billion is under definitive agreements. Vexler said the vast majority of the enrichment backlog is LEU, either for LEU customers or as feedstock for future HALEU offtakers.

Expansion and Westerman acquisition

Centrus completed its first centrifuge at its Oak Ridge, Tennessee, manufacturing facility ahead of its year-end target. Vexler said the company is working to reduce production cycle times and increase throughput, but reserved further details about the manufacturing ramp for the investor day.

After the quarter ended, Centrus acquired supplier Westerman for approximately $116 million, consisting of $95 million in cash and $21 million in equity. Management said the acquisition is intended to reduce supply-chain and project risks and diversify revenue. Tinelli said he expects the deal to be accretive in its first year, without providing specific margin figures.

Vexler also said Centrus had secured all suppliers it considers critical and completed its first certified-for-construction package for its Piketon, Ohio, project. The company plans to host its investor day at the Piketon plant.

Guidance and financing

Centrus reaffirmed 2026 revenue guidance of $450 million to $500 million and total capital spending guidance of $350 million to $500 million. Management said the outlook excludes the Westerman acquisition and its potential revenue contribution.

The company ended the third quarter with approximately $2.2 billion in unrestricted cash. In September, it raised about $500 million through an offering of stock, pre-funded warrants and accompanying common warrants. Tinelli said the common warrants could generate approximately $2 billion in additional gross proceeds if exercised in full, at exercise prices ranging from about $227 to $363 per share.

Tinelli said Centrus expects to deploy capital at a faster pace as construction and manufacturing progress, with additional guidance expected at the December investor day.

About Centrus Energy (NYSE:LEU)

Centrus Energy Corp. NYSE: LEU is a U.S.-based supplier of nuclear fuel and related services. The company provides enriched uranium products, including low-enriched uranium used to fuel commercial nuclear reactors, as well as uranium and fuel-management services for utilities and other customers in the nuclear energy industry.

Centrus is also developing high-assay low-enriched uranium (HALEU), an advanced fuel intended for certain next-generation and small modular reactors. Its American Centrifuge technology is being developed to support domestic uranium enrichment and reduce reliance on foreign fuel-supply chains.

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