Cameco operating profit up on prices

Mon Nov 7, 2011 9:18am EST
 
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(Reuters) - Uranium producer Cameco Corp (CCO.TO: Quote) said on Monday its third-quarter operating profit rose on higher uranium sales volumes and better realized prices, but fell short of analysts expectations for the quarter.

Excluding one-time items, earnings were C$104 million, or 26 Canadian cents a share, compared with C$80 million, or 20 Canadian cents a share, a year earlier.

Analysts, on average, had expected earnings of 31 Canadian cents per share, according to Thomson Reuters I/B/E/S.

Net profit for the quarter was C$39 million, or 10 Canadian cents per share, compared with a year-earlier profit of C$98 million, or 25 Canadian cents a share.

Cameco said its net profit fell on losses on foreign exchange derivatives and a weaker Canadian dollar.

Revenue rose 26 percent to C$527 million in the quarter, as uranium sales volumes rose 29 percent to 7.2 million pounds at an average realized price of $47.33 a pound. That compared with 5.6 million pounds at $40.63 in the year-earlier quarter.

The Saskatoon, Saskatchewan-based miner produced 5.3 million pounds of uranium, compared with 5.6 million pounds in the third quarter of 2010, as production fell at its Smith Ranch-Highland mine in Wyoming and the Inkai mine in Kazakhstan.

The company lowered its uranium production outlook for the year to 21.7 million pounds from an earlier estimate of 21.9 million pounds. It also lowered its guidance for UF6, a compound used to make enriched uranium, by about 6 percent due to unfavorable market conditions.

(Reporting by Julie Gordon, editing by Gerald E. McCormick and Maureen Bavdek)