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8-K - 8-K - WESTWATER RESOURCES, INC.a13-18378_18k.htm

Exhibit 99.1

 

GRAPHIC

NEWS
RELEASE

 

6950 South Potomac St.

Suite 300

Centennial, CO  80112

 

Investor Contact:

Deborah K. Pawlowski

Kei Advisors LLC

716.843.3908

dpawlowski@keiadvisors.com

 

Uranium Resources Provides Second Quarter 2013 Update

 

CENTENNIAL, CO, August 9, 2013 — Uranium Resources, Inc. (NASDAQ: URRE) (“URI” or the “Company”) today provided an update on the Company’s activities and financials through June 30, 2013, as well as its strategy and outlook.

 

Second Quarter and Recent Highlights

 

·                  Consolidated corporate headquarters in Denver, Colorado, and rationalized office locations which should generate $1.5 million in annualized savings.

·                  Strengthened team with the appointment of Jeffrey L. Vigil as Vice President-Finance and Chief Financial Officer.

·                  Improved economics from future production in Texas with renegotiated uranium supply contract.

·                  URI continues to actively monitor all expenses and is executing initiatives to conserve cash; the Company expects a lower monthly cash burn during the second half of the year.

 

“We continue to take the necessary actions to conserve cash and strengthen our balance sheet in the near term and to place us on solid ground for the future.  During the quarter, we executed our consolidation plan and enhanced the corporate team based in Denver with the appointment of Jeff Vigil as CFO,” stated Christopher M. Jones, President and Chief Executive Officer of URI.  “The recently announced renegotiated ITOCHU agreement and the progress made at the Kingsville Dome pond project are important steps that will position us to resume production activities in Texas during the latter half of 2014.”

 

Preparing for return to production in Texas; Restoration and rehabilitation activities progressing

 

Groundwater restoration activities in Texas continue to progress, with well plugging of the Rosita project’s production areas 1 and 2 by the end of the year.  The Company continues restoration activities with stabilization targeted for the fourth quarter of 2013 for all production areas at the Kingsville Dome and Vasquez projects.

 

The Kingsville Dome holding pond rehabilitation is expected to be completed by the end of the year, and the refurbishment of the processing facility back to production capability will take approximately six months thereafter.  The Company expects to be in a position for production in Texas during the latter half of 2014.

 

URI amended its uranium supply contract with ITOCHU International Inc. in early July.  The new contract strengthens the economics of production from URI’s facilities by providing an improved sales pricing structure.  ITOCHU committed to purchase one-half of all production from the Vasquez, Rosita or Kingsville properties up to three million pounds of U3O8.

 

-MORE-

 



 

In early January 2013, URI announced the expansion of its exploration program with Cameco to include 22,700 net acres known as the Tecolote tract.  URI and Cameco are currently in phase three of a five-phase exploration program.  This phase is expected to wrap up by the end of 2013 and to date, seven wide-spaced holes at an average depth of about 1,200 feet have been completed.  A second drill rig was recently brought onto the property.

 

Evaluating long-term assets in New Mexico

 

URI recently initiated evaluation work in an effort to produce national instrument 43-101 reports for some of its long-term assets in New Mexico, including Roca Honda and the Cebolleta property. The Company believes that this additional technical analysis will provide management with greater strategic clarity.

 

URI has continued its efforts on reaching a permanent access agreement with the Navajo Nation.  Conversations continue and recently environmental and surveying contractors were on the site and completed some initial work on a proposed right of way.  These actions are aimed at further de-risking and improving the economics of the Churchrock project.

 

Liquidity Position

 

Cash at June 30, 2013 was $5.3 million compared with $4.4 million at the end of the first quarter of 2013 and $4.7 million as of December 31, 2012.  The June balance reflected the return of capital as a result of replacing $9.0 million of fully collateralized financial surety instruments with new surety bonds requiring collateral of only 40% of the face amount of the bonds, resulting in approximately $5.4 million in additional cash available for operations.  At the end of July 2013, URI’s cash position was $4.25 million.

 

Mr. Jones stated, “We have lowered our core cash requirements now that we have completed many of our efficiency and consolidation initiatives and expect to see further cost reductions as restoration activities come to a close around the end of the year.”

 

URI did not utilize its existing At-The-Market Sales Agreement (“ATM”) during the second quarter of 2013.  At the end of the quarter, the Company had a total of $9.0 million in share value available for future sales under the ATM.

 

Teleconference and Webcast

 

URI will host a conference call and webcast today at 11:30 a.m. ET.  During the call, management will provide an update on URI’s strategies, outlook, and progress in advancing its Texas and New Mexico properties.  A question-and-answer session will follow.

 

The URI conference call can be accessed by calling (201) 689-8471.  The live listen-only audio webcast can be monitored on the Company’s website at www.uraniumresources.com, where it will be archived afterwards.

 

A telephonic replay will be available from 2:30 p.m. ET the day of the teleconference until Friday, August 16, 2013.  To listen to the archived call, dial (858) 384-5517 and enter replay pin number 417986.  A transcript will also be posted on the Company’s website, once available.

 

About Uranium Resources, Inc.

 

Uranium Resources, Inc. explores for, develops and mines uranium.  Since its incorporation in 1977, URI has produced uranium by in-situ recovery (ISR) methods in the state of Texas and currently has a number of initiatives underway to return the Company to production.  URI has over 206,600 acres of uranium mineral holdings and 144.8 million pounds of in-place mineralized uranium material in New Mexico and an NRC license to produce up to 3 million pounds of uranium per year.  URI has an additional 664,000 pounds of in-place reserves in Texas.  The Company acquired these properties over the past 20 years along with an extensive information database of historic drill hole logs, assay certificates, maps and technical reports.

 

2



 

Uranium Resources routinely posts news and other information about the Company on its website at www.uraniumresources.com.

 

Safe Harbor Statement

 

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements are subject to risks, uncertainties and assumptions and are identified by words such as “expects,” “estimates,” “projects,” “anticipates,” “believes,” “could,” and other similar words.  All statements addressing operating performance, events, or developments that the Company expects or anticipates will occur in the future, including but not limited to statements relating to the Company’s mineralized uranium materials, access to properties, completion of restoration activities, the outcome of discussions with the Navajo Nation and royalty holders, production capacity of mining operations planned for properties in South Texas and New Mexico, planned dates for commencement of production at such properties, annualized savings from consolidating offices, improved economics from revised supply contract, lower monthly cash burn, and the Company’s ability to conserve cash and strengthen its balance sheet and the timing and completion of exploration activities at Tecolote are forward-looking statements. Because they are forward-looking, they should be evaluated in light of important risk factors and uncertainties. These risk factors and uncertainties include, but are not limited to, the Company’s ability to raise additional capital in the future, spot price and long-term contract price of uranium, the outcome of negotiations with the Navajo Nation, the Company’s ability to reach agreements with current royalty holders, weather conditions, operating conditions at the Company’s mining projects, government and tribal regulation of the mining industry and the nuclear power industry, world-wide uranium supply and demand, availability of capital, maintaining sufficient financial assurance in the form of sufficiently collateralized surety instruments and other factors which are more fully described in the Company’s documents filed with the Securities and Exchange Commission.  Should one or more of these risks or uncertainties materialize, or should any of the Company’s underlying assumptions prove incorrect, actual results may vary materially from those currently anticipated. In addition, undue reliance should not be placed on the Company’s forward-looking statements. Except as required by law, the Company disclaims any obligation to update or publicly announce any revisions to any of the forward-looking statements contained in this news release.

 

TABLES FOLLOW.

 

3



 

URANIUM RESOURCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

 

June 30,
2013

 

December 31,
2012

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

5,325,813

 

$

4,664,596

 

Receivables, net

 

5,925

 

276,801

 

Prepaid and other current assets

 

395,654

 

431,427

 

Total current assets

 

5,727,392

 

5,372,824

 

Property, plant and equipment, at cost:

 

 

 

 

 

Uranium properties

 

108,232,478

 

107,672,404

 

Other property, plant and equipment

 

1,333,861

 

1,360,598

 

Less-accumulated depreciation, depletion and impairment

 

(65,466,430

)

(65,318,921

)

Net property, plant and equipment

 

44,099,909

 

43,714,081

 

Long-term investment:

 

 

 

 

 

Certificates of deposit, restricted

 

4,010,292

 

9,491,865

 

 

 

$

53,837,593

 

$

58,578,770

 

Current liabilities:

 

 

 

 

 

Accounts payable

 

$

764,448

 

$

1,331,888

 

Note payable

 

 

5,000,000

 

Current portion of asset retirement obligations

 

887,257

 

1,160,378

 

Royalties and commissions payable

 

665,745

 

665,745

 

Accrued interest and other accrued liabilities

 

748,787

 

859,981

 

Current portion of capital leases

 

40,431

 

112,140

 

Total current liabilities

 

3,106,668

 

9,130,132

 

Asset retirement obligations

 

3,455,798

 

3,337,679

 

Other long-term deferred credits

 

500,000

 

500,000

 

Long-term capital leases, less current portion

 

8,847

 

17,582

 

Long-term debt, less current portion

 

450,000

 

450,000

 

Total liabilities

 

7,521,313

 

13,435,393

 

Shareholders’ equity:

 

 

 

 

 

Common stock, $.001 par value, shares authorized: 200,000,000; shares issued and outstanding (net of treasury shares): 2013—20,020,258; 2012—16,150,163

 

20,024

 

16,154

 

Paid-in capital

 

216,504,760

 

207,338,549

 

Accumulated deficit

 

(170,199,086

)

(162,201,908

)

Less: Treasury stock (3,813 shares), at cost

 

(9,418

)

(9,418

)

Total shareholders’ equity

 

46,316,280

 

45,143,377

 

 

 

$

53,837,593

 

$

58,578,770

 

 

4



 

URANIUM RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

 

 

 

2013

 

2012

 

2013

 

2012

 

Revenues:

 

 

 

 

 

 

 

 

 

Uranium sales

 

$

 

$

 

$

 

$

 

Total revenue

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

Cost of uranium sales:

 

 

 

 

 

 

 

 

 

Operating expenses

 

630,907

 

923,429

 

1,318,124

 

1,143,837

 

Accretion/amortization of asset retirement obligations

 

97,435

 

23,624

 

194,870

 

46,743

 

Depreciation and depletion

 

73,919

 

110,996

 

149,818

 

227,318

 

Impairment of uranium properties

 

400,226

 

482,849

 

679,655

 

751,772

 

Exploration expenses and land maintenance costs

 

652,455

 

30,744

 

751,360

 

57,459

 

Total cost of uranium sales

 

1,854,942

 

1,571,642

 

3,093,827

 

2,227,129

 

Loss from operations before corporate expenses

 

(1,854,942

)

(1,571,642

)

(3,093,827

)

(2,227,129

)

Corporate expenses:

 

 

 

 

 

 

 

 

 

General and administrative

 

1,939,882

 

2,183,553

 

4,575,118

 

5,196,689

 

Depreciation

 

37,163

 

31,956

 

83,142

 

63,840

 

Total corporate expenses

 

1,977,045

 

2,215,509

 

4,658,260

 

5,260,529

 

Loss from operations

 

(3,831,987

)

(3,787,151

)

(7,752,087

)

(7,487,658

)

Other income (expense):

 

 

 

 

 

 

 

 

 

Interest expense

 

(9,908

)

(3,121

)

(249,626

)

(6,668

)

Interest and other income (expense), net

 

(4,691

)

129,593

 

4,535

 

227,177

 

Net loss

 

$

(3,846,586

)

$

(3,660,679

)

$

(7,997,178

)

$

(7,267,149

)

Basic and diluted net loss per common share

 

$

(0.19

)

$

(0.30

)

$

(0.43

)

$

(0.70

)

Average weighted shares outstanding

 

19,879,847

 

10,626,011

 

18,580,078

 

10,215,350

 

 

5



 

URANIUM RESOURCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

Six Months Ended
June 30,

 

 

 

2013

 

2012

 

Operating activities:

 

 

 

 

 

Net loss

 

$

(7,997,178

)

$

(7,267,149

)

Reconciliation of net loss to cash used in operations—

 

 

 

 

 

Accretion/amortization of asset retirement obligations

 

194,870

 

46,743

 

Depreciation and depletion

 

232,960

 

291,158

 

Impairment of uranium properties

 

679,655

 

751,772

 

Decrease in restoration and reclamation accrual

 

(933,897

)

(879,269

)

Stock compensation expense

 

183,316

 

311,797

 

Other non-cash items, net

 

73,795

 

609

 

Effect of changes in operating working capital items—
(Increase) decrease in receivables

 

270,876

 

(83,354

)

Decrease in prepaid and other current assets

 

35,773

 

46,242

 

Increase (decrease) in payables, accrued liabilities and deferred credits

 

(291,301

)

1,672,138

 

Net cash used in operating activities

 

(7,551,131

)

(5,109,313

)

Cash flows from investing activities:

 

 

 

 

 

(Increase) decrease in certificates of deposit, restricted

 

5,481,573

 

(46,715

)

Increase in notes receivable

 

 

(3,156,765

)

Additions to uranium properties

 

(788,213

)

(3,155,448

)

Net cash provided by (used in) investing activities

 

4,693,360

 

(6,358,928

)

Cash flows from financing activities:

 

 

 

 

 

Payments on borrowings

 

(80,444

)

(31,702

)

Issuance of common stock, net

 

3,599,432

 

11,434,055

 

Net cash provided by financing activities

 

3,518,988

 

11,402,353

 

Net increase (decrease) in cash and cash equivalents

 

661,217

 

(65,888

)

Cash and cash equivalents, beginning of period

 

4,664,596

 

2,890,263

 

Cash and cash equivalents, end of period

 

$

5,325,813

 

$

2,824,375

 

Non-cash transactions:

 

 

 

 

 

Issuance of common stock for short-term loan principal and interest payments

 

$

5,095,833

 

 

Issuance of common stock for services

 

$

291,500

 

 

Issuance of restricted stock to employees and directors

 

$

247

 

$

341

 

Capital lease obligations

 

$

 

$

24,931

 

 

###

 

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