USEC Inc. (NYSE: USU) today held its annual meeting of shareholders and reported on the challenges the Company faced in 2011 and the steps it is taking to address them in 2012 as it charts a course for the future. John K. Welch, USEC president and chief executive officer, said that last year’s results demanded that USEC’s management team take action and make fundamental changes to the organization to position the Company to capitalize on the long-term prospects for nuclear power, which includes demand from more than 60 new reactors under construction. Meeting that demand will require USEC to transition from production at the Paducah Gaseous Diffusion Plant to its American Centrifuge technology. “Despite near-term challenges and uncertainties, we remain positive about the longer term prospects for the enrichment sector and the nuclear industry,” said Welch. “We remain convinced that the American Centrifuge technology is our best path to a competitive source of enrichment that will meet the long-term needs for our customers, while providing an indigenous capability for U.S. domestic energy and national security requirements. Meeting those needs through a reliable, competitive source will, in turn, build long-term value for shareholders.” Welch noted that USEC is proceeding with a two-year, cost-sharing research, development and demonstration program designed to enhance the technical and financial readiness of the centrifuge technology, which USEC sees as a bridge to obtaining a U.S. Department of Energy (DOE) loan guarantee and commercial deployment of the technology. “We have been encouraged by the Administration’s increasingly visible support for the essential national security role that both our Paducah gaseous diffusion plant and the American Centrifuge project play in providing indigenous U.S. sources to enrich uranium,” said Welch. Welch said USEC is working with DOE and Congress on legislative and non-legislative paths for obtaining funding for the RD&D program, which USEC has funded through the end of May. He noted that both House and Senate appropriators have included funding for the program in fiscal 2013, but he reiterated that the Company is prepared to demobilize the project if federal funding for the remainder of fiscal year 2012 is not secured before May 31.
Welch concluded by highlighting that the Company is in a major transition to align its workforce with its future business structure, resulting in a smaller workforce and leaner cost structure. While USEC is taking a phased approach, he expects further reductions in the months ahead.To read a copy of Welch’s complete remarks to shareholders, please go to Speeches in the Media section of the Company’s website, www.usec.com. During the meeting, shareholders voted to reelect ten directors for a one-year term. Director Michael H. Armacost retired from the board and did not stand for reelection. On behalf of the shareholders, Chairman James R. Mellor thanked Armacost for his service to the board since 2002. Shareholders also approved an advisory resolution on executive compensation, a tax benefit preservation plan and ratified the appointment of PricewaterhouseCoopers as the Company’s independent auditors for 2012. The specific voting results will be provided in a current report on Form 8-K. USEC Inc., a global energy company, is a leading supplier of enriched uranium fuel and nuclear industry related services for commercial nuclear power plants. Forward-Looking Statements: This news release contains “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934 – that is, statements related to future events. In this context, forward-looking statements may address our expected future business and financial performance, and often contain words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “will” and other words of similar meaning. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For USEC, particular risks and uncertainties that could cause our actual future results to differ materially from those expressed in our forward-looking statements include, but are not limited to: risks related to the ongoing transition of our business, including uncertainty regarding the transition of the Paducah gaseous diffusion plant and uncertainty regarding continued funding for the American Centrifuge project and the impact of decisions we may make in the near term on our business and prospects; the impact of the March 2011 earthquake and tsunami in Japan on the nuclear industry and on our business, results of operations and prospects; the impact of excess supply in the market and the lack of uncommitted demand for low enriched uranium over the next two to four years; the potential impacts of a decision to cease enrichment operations at Paducah; the outcome of ongoing discussions with the U.S. Department of Energy (“DOE”) regarding the research, development and demonstration (“RD&D”) program, including uncertainty regarding the timing, amount and availability of funding for such RD&D program and the dependency of government funding on Congressional appropriations; restrictions in our credit facility on our spending on the American Centrifuge project after May 31, 2012 and the potential for us to demobilize the project; the impact of any conditions that are placed on us or on the American Centrifuge project in connection with or as a condition to the RD&D program or other funding, including a restructuring of our role and investment in the project; limitations on our ability to provide any required cost sharing under the RD&D program; the ultimate success of efforts to obtain a DOE loan guarantee for the American Centrifuge project, including the ability through the RD&D program or otherwise to address the concerns raised by DOE with respect to the financial and project execution depth of the project, and the timing and terms thereof; the impact of actions we have taken or may take to reduce spending on the American Centrifuge project, including the potential loss of key suppliers and employees, and impacts to cost and schedule; the impact of delays in the American Centrifuge project and uncertainty regarding our ability to remobilize the project; the potential for DOE to seek to exercise its remedies under the June 2002 DOE-USEC agreement; our dependence on deliveries of LEU from Russia under a commercial agreement (the “Russian Contract”) with a Russian government entity known as Techsnabexport (“TENEX”) and on a single production facility and the potential for us to cease commercial enrichment of uranium in the event of a decision to shut down Paducah enrichment operations; changes in U.S. government priorities and the availability of government funding, including loan guarantees; and other risks and uncertainties discussed in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K, which are available on our website at www.usec.com. We do not undertake to update our forward-looking statements except as required by law.