Uranium Resources, Inc. (



Q3 2011 Earnings Call

November 14, 2011; 11:00 am ET


Don Ewigleben - President & Chief Executive Officer

Tom Ehrlich - Chief Financial Officer

Van Horn - Senior Vice President of Operations & Exploration

Mark Pelizza - Senior Vice President of Environmental Safety & Public Affairs

Deborah Pawlowski - Investor Relations


David Snow - Energy Equities Inc.

David Talbot - Dundee Capital Markets

Kurt Churdavis (ph) - Private Investor



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Greetings and welcome to the Uranium Resources Incorporated third quarter 2011 quarterly update conference call. At this time all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions).

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It is now my pleasure to introduce your host, Ms. Deborah Pawlowski, Investor Relations for Uranium Resources Incorporated. Thank you Ms. Pawlowski; you may begin.

Deborah Pawlowski

Thank you Jackie and good morning everyone. We appreciate your time today and your interest in Uranium Resources.

On the call I have President and CEO, Don Ewigleben, who will discuss the quarter and recent events, as well as our strategy and outlook as we move forward. We also have Tom Ehrlich, Chief Financial Officer who will discuss our liquidity position with Van Horn, Senior Vice President of Operations and Exploration; as well as Mark Pelizza, our Senior Vice President of Environmental Safety and Public Affairs who’ll be available as well for Q&A.

I will conclude the call with an opportunity for the Q&A. If you don't have today's release, it can be found on our website at uraniumresources.com.

As you are aware, we may make some forward-looking statements during the formal presentation and the Q&A portion of this teleconference. Those statements apply to future events, which are subject to risks and uncertainties, as well as other factors that could cause the actual results to differ materially from where we are today.

These factors are outlined in the news release, as well as the documents filed by the company with the Securities and Exchange Commission. You can find those on our website where we regularly post information about the company, as well as on the SEC's website at sec.gov. So please review our forward-looking statements in conjunction with these cautionary factors.

With that, let me turn the call over to Don to begin the discussion. Don.

Don Ewigleben

Thank you Debbie and thanks to all of you that are joining us this morning and keeping your interest in URI, we appreciate it. I’d like to start today’s discussion with a bit of an industry overview and then move onto URI and our strategy to get to production in both New Mexico and Texas, while we are trying to enhance our uranium asset base through additional expiration and acquisition.

Although the uranium market continues to be out of favor for the most part with investors, there are some early rumblings of increasing confidence developing that beings to re-embrace the opinion that many of us have on the long term outlook for nuclear power and the expected imbalance of uranium supply to meet the growing demand.

The M&A activity in our industry has resurrected of late. It’s also good news in general to those of us who believe that this industry will survive the present pricing. However the near term situation still reflects the seriousness of the incident at Fukushima; it’s impact on the current nuclear powered market place and it’s resulting impact to the uranium thirst.

This combined with the issues that uranium miners are facing with rising cost for equipment, difficulty in gaining personnel and generate a good capital are certainly making these times in our industry quite challenging, but I remain confident that the uranium industry will continue to rise to these challenges.

Current consensus on pricing still has most believing that reaching $60 to $65 per pound per spot is all that should be expected for the next two years. The reported weekly stock price was $52.25 a week ago, but the daily broker price mid point end of the week was an encouragingly increased price of $53.50.

Long-term contract prices dropped a bit to about $63. The current overhangs that had been weighing down the price which include the DOEs, sales of it’s inventory that have not been in line with it’s filed plans, as well as the inventory building in Japan and Germany from a shutdown of reactors there. We believe however that these are short-term phenomenon. As we discussed regularly, there still exist drivers for a supply demand imbalance, an overall support for an improvement in uranium prices. Let me recount a few of those.

As we all know the Russian ACU contract comes to an end in 2013 and Russia has it’s own need for uranium to address it’s nuclear power plants. Efforts by the DOE to salvage inventories have come under pressure recently from the GAO, the General Accounting Office. The DOE will be updating their plan and this should help to remove that uncertainty from the market side.

The products become more concentrated, making the market more vulnerable to disruptions if there are any problems with a particular supply force. With many of the major producers reducing their production guidance there are indications that supply could be tightening and lets just accept the fact that the likelihood of delays with certain mining projects expected in the next year are pretty good and that it’s possible will change the nature of pricing, because it is the nature of mining.

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