A majority of reactors served by USEC are refueled on an 18-to-24-month cycle, which can lead to significant quarterly and annual swings in SWU sales volume that reflects the mix of refueling cycles. Therefore, short-term comparisons of USEC’s financial results are not necessarily indicative of longer-term results.Cost of Sales and Gross Profit Margin Cost of sales for the quarter ended March 31, 2012, for SWU and uranium was $501.2 million, an increase of $194.0 million or 63 percent, compared to the corresponding period in 2011 due to the associated increase in SWU sales volume. Cost of sales per SWU was 2 percent lower in the quarter compared to the first quarter of 2011 due to revisions to prior accrued amounts associated with estimated disposal costs for depleted uranium and property taxes related to enrichment operations. Excluding the effect of these items, cost of sales per SWU was approximately 1 percent higher than the first quarter of 2011. Cost of sales for SWU reflects monthly moving average inventory costs based on production and purchase costs. Production costs increased $3.2 million, or 2 percent, as production volume increased 4 percent in the three months ended March 31, 2012, compared to the corresponding period in 2011. The unit production cost, however, declined 3 percent in the first quarter of 2012 compared to the corresponding period in 2011. USEC purchased supplemental power during the first quarter of 2012 from the Tennessee Valley Authority (TVA) that had been deferred from 2011 due to regional flood conditions. The average cost per megawatt hour declined 5 percent reflecting lower TVA fuel cost adjustments, partially offset by the fixed, annual increase in the TVA contract price. Although the unit cost of production declined, the SWU unit cost of sales was negatively affected by higher production and purchase costs embedded in our inventory costs from prior periods.