PEAK ASSET: ARVO WRAP 26 February: ASX hits new peak as Ramsay soars; Qantas dives 9pc | Oil steadies as traders focus on upcoming US-Iran nuclear talks | Boss Energy Reports $36.2m Positive Net Cash Flow from Honeymoon Uranium Project |

Boss Energy Reports $36.2m Positive Net Cash Flow from Honeymoon Uranium Project

• BOE: $36.2m op cash flow; H1 rev $81.8m; prod 842k lbs.

• Inventory costs: $68.3/lb; C1 to $40/lb; 1.65m lbs on hand.

• Cash: end-H1 $208m; bank $52.9m; pos cash.

Boss Energy (ASX: BOE) has achieved $36.2 million in positive net cash flow from operating activities at the Honeymoon uranium project in South Australia during the six months to end December.

The company’s revenue during the period increased by 71% to $81.8m on the back of a boost in uranium sales to 750,000 pounds (from 400,000lbs in the previous period), fuelling an increase in production to 842,000lbs (from 227,000lbs) as additional wellfields and NIMCIX columns were brought online.

Operating costs of $71.2m comprised $42.2m for 400,000lbs of purchased uranium and $29m for 350,000lbs of produced uranium.

The weighted average cost of inventory dropped from $85.4/lb to $68.3/lb as recent lower-cost production reduced the weighting of purchased uranium and higher-cost first production.

Accumulated Inventory Impact

Boss reported a net loss after tax of $7.9m primarily driven by the accounting impact of selling purchased and accumulated inventory including the higher-cost first production.

It also recorded a reduction to its C1 cost guidance from around $45/lb to $40/lb following positive results from reagent optimisation programs in the wellfields and plant.

The company finished the half-year with 1.65 million pounds uranium concentrate inventory and plans to continue accumulating to increase its exposure to rising commodity prices.

“We are pleased to deliver a strong financial and operational result to produce 842k lbs and reduce our C1 cost guidance during the half-year—this reflects our continued focus on improving cost, productivity, and efficiency,” chief executive officer Matthew Dusci said.

“With the Honeymoon review now concluded, we have a clear pathway forward as we prioritise the new feasibility study based on a revised wide-spaced wellfield design.”

Expenses and Investments

Expenses were attributed to corporate costs (including employee and consultant fees of $8.2m), adverse fair value movements in financial assets ($7.2m), exploration and evaluation expenditure ($1.6m) and net financing costs ($1.3m).

Investments decreased by $6.7m reflecting a marked to market write-down in the fair value of investments in listed entities, while loan receivables decreased by $15.8m as enCore Energy repaid the remaining half of a 200,000lb uranium loan plus accumulated interest.

Net cash and liquid assets dropped by $25.8m as a result of a $9.4m increase in trade payables and capital accruals, also reflecting increased capital works related to onsite drilling and wellfield construction to support future production.

Boss invested $28m in Honeymoon and Alta Mesa development activities during the reporting period to create additional plant capacity and build-out wellfield infrastructure at both operations.

At the end of the period, Boss had $208m at bank including cash of $52.9m (up $16.3m or 45% on the same time last year), driven by the positive net cash result.

Source: SmallCaps