Paladin Energy Ltd
TSX : PDN
ASX : PDN

Paladin Energy Ltd

August 27, 2010 02:58 ET

Paladin Energy Ltd: 30 June 2010 APPENDIX 4E Preliminary Financial Report

PERTH, WESTERN AUSTRALIA--(Marketwire - Aug. 27, 2010) - Paladin Energy Ltd ("Paladin" or "the Company") (TSX:PDN)(ASX:PDN) announces the release of its 30 June 2010 Appendix 4E – Preliminary Financial Report. The Appendix 4E – Preliminary Financial Report is appended to this News Release.

Final 2010 Year Results

References to 2010 and 2009 refer to the equivalent twelve months ended 30 June 2010 and 2009 respectively.

  • Record total uranium oxide (U3O8) production of 4,320,000lb for 2010 compared to 2,700,000lb for 2009. A year on year increase of 60%.
  • Total U3O8 production of 1,440,000lb for the June 2010 quarter compared to 700,000lb for the 30 June 2009 quarter. A quarter on quarter increase of 106%. For the second successive quarter, production has exceeded 1,000,000lb.
  • Langer Heinrich Mine delivered a second successive full quarter production at Stage 2 nameplate of 3.7Mlb per annum equivalent.
    • June 2010 quarterly production of 930,000lb U3O8 at nameplate.
    • Full year production of 3,350,000lb U3O8 for 2010 compared to 2,700,000lb for 2009. A year on year increase of 24%.
    • Stage 3 construction to expanded capacity of 5.2Mlb per annum is significantly advanced with construction now 50% complete as of mid-July.
    • Stage 4 resource upgrade drilling of 30,000m for expansion to 10Mlb per annum completed in May. A new reserve estimation to underpin the Stage 4 feasibility study is expected in the September quarter.
  • Kayelekera Mine commercial production declared 1 July 2010.
    • Production of 960,000lb U3O8 for FY 2010
    • Production of over 515,000lb for the quarter ended 30 June 2010 compared to 230,000lb for the quarter ended 31 March 2010, a quarter on quarter increase of 125%
    • KM process plant continues to operate at levels announced in our Quarterly Activities Report. Advancements in resin handling will be complete during the September quarter which will allow the circuits, (already proven to nameplate) to operate on a consistent basis and at design recovery levels. 
    • Reconciliation of the ore mined to the resource model remains excellent.
  • Langer Heinrich Mine cost of sales for 2010 remained at US$26/lb. This represents an improved operational performance given the strengthening in the Namibian dollar exchange rate by 15% during this period.
  • Record total sales volume for 2010 of 3,730,000lb U3O8 represents an 84% increase compared to 2,020,000lb for 2009. Langer Heinrich Mine sold 2,730,000lb and Kayelekera Mine sold 1,000,000lb. The average realised uranium sales price for 2010 was maintained at an industry leading US$54/lb compared to US$55/lb for 2009.
  • Establishing a footprint in Niger, a major underexplored uranium province; Paladin launched a A$27M recommended takeover offer for NGM Resources Limited.
  • Memorandum of Understanding (MOU) announced with CGNPC Uranium Resources Co., Ltd setting a framework of co-operation for long term sales of uranium, potential participation in growth strategies and possible expansion of joint venture relationships.
  • Resource upgrades during the year included:-
    • Kayelekera: Drilling totalling 7,061m was completed resulting in the Inferred Resource increasing 63% to 7.57Mlb U3O8 and the Measured and Indicated Resource increasing by 6% to 38.8Mlb U3O8.
    • Valhalla: Measured and Indicated Resources were increased by 9.9% to 60.0Mlb U3O8 and total Resources were increased from 67.5Mlb to 69.9Mlb U3O8.
    • Skal East: Initial Indicated Resource estimates for the deposit were increased 38% to 3.9Mlb U3O8.
  • US$17.1M spent during the year across Paladin's exploration properties. The results have identified a previously announced resource expansion at Kayelekera, advanced both the Angela and Mount Isa programmes and identified the new Odin prospect, 500m north of Valhalla, that has significant potential. At Odin 3 to 5 mineralised lenses have been identified at shallow depths having true thicknesses of 5 to 15 metres. Paladin's exploration programme remains one of the cornerstones of the Company.
  • During the year the Company continued its strategy of placing more uranium into the term market and concluded contracts for the sale of approximately 6.2Mlbs U3O8 over the period from 2011 to 2017.
  • Profit and Loss
        30 June 2010 US$M 30 June 2009 US$M
Revenue from sales of uranium oxide Up 81% to 202.0 111.8
Gross profit Up 5% to 51.0 48.4
Loss after tax attributable to members Down 89% to 52.9 480.2
Loss per share (US cents)       (8) (78)
  Year Ended 30 June 2010 US$M   Year Ended 30 June 2009 US$M
Revenue 204.3   114.8
Gross profit 51.0   48.4
Exploration and evaluation expenses (17.1)   (12.2)
Corporate and other (35.3)   (38.4)
Finance costs (21.4)   (30.5)
Impairment of exploration and evaluation -   (753.8)
Impairment of available-for-sale financial assets -   (26.0)
Impairment of asset (2.9)   -
Share of loss of associate -   (0.9)
Loss before income tax (expense)/benefit (25.7)   (813.4)
Income tax (expense)/benefit (28.1)   237.0
Loss after income tax (expense)/benefit (53.8)   (576.4)
Non-controlling interests 0.9   96.2
Net loss after tax (52.9)   (480.2)
  • Net loss for 2010, which includes a non-cash tax charge of US$28.1M, narrowed to US$52.9M from US$480.2M for 2009.
  • Strong balance sheet at 30 June 2010 with US$348.8M in cash invested with Australian banks with a minimum AA Standard & Poor's credit rating.

The documents comprising the 30 June 2010 Appendix 4E – Preliminary Financial Report, including the Management Discussion and Analysis and Financial Statements (unaudited) are available through the following link (http://media3.marketwire.com/docs/10_08_27_30_June_2010_Appendix_4E_ASX.pdf) and will be filed with the Company's other documents on Sedar (sedar.com) and on the Company's website (paladinenergy.com.au). The 30 June 2010 audited financial statements are expected to be released in mid September however it is not anticipated that there will be any material changes from those presented in this release.

Conference Call

Conference Call and Investor Update scheduled for 07:00 Perth & Hong Kong, Wednesday 1 September 2010.

19:00 Toronto, Tuesday 31 August 2010 and 24:00 (midnight) London, Tuesday 31 August 2010. 

Details were included in a separate news release made on 12 August 2010.

ACN 061 681 098

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