Company Quick10K Filing
Energy Fuels
Price13.01 EPS-0
Shares98 P/E-43
MCap1,277 P/FCF-37
Net Debt-35 EBIT-28
TEV1,243 TEV/EBIT-44
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-06-30 Filed 2020-08-03
10-Q 2020-03-31 Filed 2020-05-04
10-K 2019-12-31 Filed 2020-03-17
10-Q 2019-09-30 Filed 2019-11-04
10-Q 2019-06-30 Filed 2019-08-05
10-Q 2019-03-31 Filed 2019-05-08
10-K 2018-12-31 Filed 2019-03-12
10-Q 2018-09-30 Filed 2018-11-05
10-Q 2018-06-30 Filed 2018-08-06
10-Q 2018-03-31 Filed 2018-05-04
10-K 2017-12-31 Filed 2018-03-12
10-Q 2017-09-30 Filed 2017-11-02
10-Q 2017-06-30 Filed 2017-08-03
10-Q 2017-03-31 Filed 2017-05-05
10-K 2016-12-31 Filed 2017-03-10
10-Q 2016-09-30 Filed 2016-11-03
10-Q 2016-06-30 Filed 2016-08-05
10-Q 2016-03-31 Filed 2016-05-06
10-K 2015-12-31 Filed 2016-03-15
8-K 2020-09-08 Other Events
8-K 2020-08-20 Officers, Other Events
8-K 2020-06-16
8-K 2020-05-27
8-K 2020-02-14
8-K 2019-12-31
8-K 2019-08-01
8-K 2019-05-30
8-K 2019-05-03
8-K 2019-03-28
8-K 2019-02-22
8-K 2018-11-02
8-K 2018-10-25
8-K 2018-08-10
8-K 2018-07-18
8-K 2018-06-28
8-K 2018-06-01
8-K 2018-05-02
8-K 2018-04-03
8-K 2018-03-14
8-K 2018-02-16
8-K 2018-01-25
8-K 2018-01-17

EFR 10Q Quarterly Report

Part I
Item 1. Condensed Consolidated Financial Statements.
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Item 4. Controls and Procedures.
Part II
Item 1. Legal Proceedings.
Item 1A. Risk Factors.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 3. Defaults Upon Senior Securities.
Item 4. Mine Safety Disclosure.
Item 5. Other Information.
Item 6. Exhibits.
EX-23.1 efr6302020-exx231.htm
EX-31.1 efr6302020-exx311.htm
EX-31.2 efr6302020-exx312.htm
EX-32.1 efr6302020-exx321.htm
EX-32.2 efr6302020-exx322.htm
EX-95.1 efr6302020-exx951.htm

Energy Fuels Earnings 2020-06-30

Balance SheetIncome StatementCash Flow
0.30.20.20.10.10.02015201620182020
Assets, Equity
0.10.10.0-0.0-0.1-0.12015201620182020
Rev, G Profit, Net Income
0.10.10.0-0.0-0.1-0.12015201620182020
Ops, Inv, Fin

Document
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2020
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission File Number: 001-36204
eflogoa17.jpg
ENERGY FUELS INC.
(Exact name of registrant as specified in its charter)
Ontario,
Canada
98-1067994
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)

225 Union Blvd.,
Suite 600
 
Lakewood,
Colorado
80228
(Address of principal executive offices)
(Zip Code)

(303) 974-2140
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common shares, no par value
UUUU
NYSE American
 
EFR
Toronto Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes      No





Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes      No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act): Yes      No

As of July 31, 2020, the registrant had 125,562,618 common shares, without par value, outstanding.




ENERGY FUELS INC.
FORM 10-Q
For the Quarter Ended June 30, 2020
INDEX


3



CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report and the exhibits attached hereto (the “Quarterly Report”) contain “forward-looking statements” within the meaning of applicable United States ("U.S.") and Canadian securities laws, which are included but are not limited to statements with respect to Energy Fuels Inc.’s (the “Company” or “Energy Fuels”) anticipated results and progress of the Company’s operations in future periods, planned exploration, if warranted, development of its properties, plans related to its business, and other matters that may occur in the future. These statements relate to analyses and other information that are based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.
Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, schedules, assumptions, future events, or performance (often, but not always, using words or phrases such as “expects” or “does not expect,” “is expected,” “is likely,” “budget,” “scheduled," "forecasts,” "intends,” “anticipates” or “does not anticipate,” "continues," “plans,” “estimates,” or “believes,” and similar expressions or variations of such words and phrases or statements stating that certain actions, events or results “may,” “could,” “would,” “might,” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements.
Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Energy Fuels believes that the expectations reflected in these forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct, and such forward-looking statements included in, or incorporated by reference into, this Quarterly Report should not be unduly relied upon. This information speaks only as of the date of this Quarterly Report.
Readers are cautioned that it would be unreasonable to rely on any such forward-looking statements and information as creating any legal rights, and that the statements and information are not guarantees and may involve known and unknown risks and uncertainties, and that actual results are likely to differ (and may differ materially) and objectives and strategies may differ or change from those expressed or implied in the forward-looking statements or information as a result of various factors. Such risks and uncertainties include global economic risks such as the occurrence of a pandemic and risks generally encountered in the exploration, development, operation, and closure of mineral properties and processing and recovery facilities, as well as risks related to the activities proposed in the President’s Budget for fiscal year 2021, including the establishment of a Uranium Reserve for the United States, and risks related to any additional recommendations of the United States Nuclear Fuel Working Group not benefiting the Company in any material way. Forward-looking statements are subject to a variety of known and unknown risks, uncertainties and other factors which could cause actual events or results to differ from those expressed or implied by the forward-looking statements, including, without limitation:
global economic risks, including the occurrence of unforeseen or catastrophic events, such as the emergence of a pandemic or other widespread health emergency (or concerns over the possibility of such an emergency), which could create economic and financial disruptions and require the Company to reduce or cease operations at some or all of its facilities for an indeterminate period of time, and which could have a material impact on the Company’s business, operations, personnel and financial condition;
risks associated with mineral reserve and resource estimates, including the risk of errors in assumptions or methodologies;
risks associated with estimating mineral extraction and recovery, forecasting future price levels necessary to support mineral extraction and recovery, and the Company’s ability to increase mineral extraction and recovery in response to any increases in commodity prices or other market conditions;
uncertainties and liabilities inherent to conventional mineral extraction and recovery and/or in-situ uranium recovery operations;
risks associated with the activities proposed in the President’s Budget for fiscal year 2021, including the establishment of a Uranium Reserve for the United States, being subject to appropriation by the Congress of the United States, and the details of implementation of the President’s Budget not yet having been defined;
risks associated with any additional recommendations of the U.S. Nuclear Fuel Working Group not benefiting the Company in any material way;
geological, technical and processing problems, including unanticipated metallurgical difficulties, less than expected recoveries, ground control problems, process upsets, and equipment malfunctions;
risks associated with the depletion of existing mineral resources through mining or extraction, without replacement with comparable resources;
risks associated with identifying and obtaining adequate quantities of alternate feed materials and other feed sources required for operation of the White Mesa Mill in Utah;
risks associated with labor costs, labor disturbances, and unavailability of skilled labor;
risks associated with the availability and/or fluctuations in the costs of raw materials and consumables used in the Company’s production processes;

4



risks and costs associated with environmental compliance and permitting, including those created by changes in environmental legislation and regulation, and delays in obtaining permits and licenses that could impact expected mineral extraction and recovery levels and costs;
actions taken by regulatory authorities with respect to mineral extraction and recovery activities;
risks associated with the Company’s dependence on third parties in the provision of transportation and other critical services;
risks associated with the ability of the Company to obtain, extend or renew land tenure, including mineral leases and surface use agreements, on favorable terms or at all;
risks associated with the ability of the Company to negotiate access rights on certain properties on favorable terms or at all;
the adequacy of the Company's insurance coverage;
uncertainty as to reclamation and decommissioning liabilities;
the ability of the Company’s bonding companies to require increases in the collateral required to secure reclamation obligations;
the potential for, and outcome of, litigation and other legal proceedings, including potential injunctions pending the outcome of such litigation and proceedings;
the ability of the Company to meet its obligations to its creditors;
the ability of the Company to access credit facilities on favorable terms;
risks associated with paying off indebtedness at its maturity;
risks associated with the Company’s relationships with its business and joint venture partners;
failure to obtain industry partner, government, and other third-party consents and approvals, when required;
competition for, among other things, capital, mineral properties, and skilled personnel;
failure to complete and integrate proposed acquisitions and incorrect assessments of the value of completed acquisitions;
risks posed by fluctuations in share price levels, exchange rates and interest rates, and general economic conditions;
risks inherent in the Company’s and industry analysts’ forecasts or predictions of future uranium, vanadium and copper price levels;
fluctuations in the market prices of uranium, vanadium and copper, which are cyclical and subject to substantial price fluctuations;
risks associated with the Company's uranium sales, if any, being required to be made at spot prices, unless the Company is able to enter into new long-term contracts at satisfactory prices in the future;
risks associated with the Company's vanadium sales, if any, generally being required to be made at spot prices;
failure to obtain suitable uranium sales terms at satisfactory prices in the future, including spot and term sale contracts;
failure to obtain suitable vanadium sales terms at satisfactory prices in the future;
risks associated with asset impairment as a result of market conditions;
risks associated with lack of access to markets and the ability to access capital;
public resistance to nuclear energy or uranium extraction and recovery;
Governmental resistance to nuclear energy or uranium extraction or recovery;
risks associated with inaccurate or nonobjective media coverage of the Company's activities and the impact such coverage may have on the public, the market for the Company's securities, government relations, permitting activities and legal challenges, as well as the costs to the Company of responding to such coverage;
uranium industry competition, international trade restrictions and the impacts on world commodity prices of foreign state subsidized production;
risks associated with the Company's involvement in industry petitions for trade remedies, including the costs of pursuing such remedies and the potential for negative responses or repercussions from various interest groups, consumers of uranium and participants in other phases of the nuclear fuel cycle;
risks associated with governmental actions, policies, laws, rules and regulations with respect to nuclear energy or uranium extraction and recovery;
risks related to potentially higher than expected costs related to any of the Company's projects or facilities;

5



risks associated with the Company’s ability to continue to recover vanadium from pond solutions at the White Mesa Mill, with potentially higher than expected costs for any such recoveries, and the Company’s ability to sell any recovered vanadium at satisfactory price levels;
risks related to the Company’s ability to recover copper from our Canyon uranium project ores;
risks related to securities regulations;
risks related to stock price and volume volatility;
risks related to the Company's ability to maintain our listing on the NYSE American and Toronto Stock Exchanges;
risks related to the Company's ability to maintain our inclusion in various stock indices;
risks related to dilution of currently outstanding shares, from additional share issuances, depletion of assets or otherwise;
risks related to the Company's lack of dividends;
risks related to recent market events;
risks related to the Company's issuance of additional common shares under our At-the-Market ("ATM") program or otherwise to provide adequate liquidity in depressed commodity market circumstances;
risks related to acquisition and integration issues;
risks related to defects in title to the Company's mineral properties;
risks related to the Company's outstanding debt;
risks related to the Company's securities; and
risks related to any material weakness that may be identified in our internal controls over financial reporting. If we are unable to implement and maintain effective internal controls over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may be negatively affected.
This list is not exhaustive of the factors that may affect our forward-looking statements. Some of the important risks and uncertainties that could affect forward-looking statements are described further under the section heading: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Quarterly Report. Although we have attempted to identify important factors that could cause actual results to differ materially from those described in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, believed, estimated, or expected. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Except as required by law, we disclaim any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. Statements relating to “Mineral Reserves” or “Mineral Resources” are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions that the Mineral Reserves and Mineral Resources described may be profitably extracted in the future.
We qualify all the forward-looking statements contained in this Quarterly Report by the foregoing cautionary statements.


6



Cautionary Note to United States Investors Concerning Disclosure of Mineral Resources
The Company is a U.S. Domestic Issuer for United States ("U.S.") Securities and Exchange Commission ("SEC") purposes, most of its shareholders are U.S. residents, the Company is required to report its financial results under U.S. Generally Accepted Accounting Principles ("U.S. GAAP"), and its primary trading market is the NYSE American. However, because the Company is incorporated in Canada and also listed on the Toronto Stock Exchange ("TSX"), this Quarterly Report contains certain disclosure that satisfies the additional requirements of Canadian securities laws, which differ from the requirements of United States’ securities laws. Unless otherwise indicated, all reserve and resource estimates included in this Quarterly Report, and in the documents incorporated by reference herein, have been prepared in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) classification system. NI 43-101 is a rule developed by the Canadian Securities Administrators (the “CSA”), which establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects.
Canadian standards, including NI 43-101, differ significantly from the requirements of SEC Industry Guide 7, and reserve and resource information contained herein, or incorporated by reference in this Quarterly Report, and in the documents incorporated by reference herein, may not be comparable to similar information disclosed by companies reporting reserve and resource information under SEC Industry Guide 7. In particular, and without limiting the generality of the foregoing, the term “resource” does not equate to the term “reserve” under SEC Industry Guide 7. Under SEC Industry Guide 7 standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. Under SEC Industry Guide 7 standards, a “final” or “bankable” feasibility study is required to report reserves; the three-year historical average price, to the extent possible, is used in any reserve or cash flow analysis to designate reserves; and the primary environmental analysis or report must be filed with the appropriate governmental authority.
SEC Industry Guide 7 disclosure standards historically have not permitted the inclusion of information concerning “Measured Mineral Resources,” “Indicated Mineral Resources” or “Inferred Mineral Resources” or other descriptions of the amount of mineralization in mineral deposits that do not constitute “reserves” by SEC Industry Guide 7 standards. United States investors should also understand that “Inferred Mineral Resources” have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an “Inferred Mineral Resource” will ever be upgraded to a higher category. Under Canadian rules, estimated “Inferred Mineral Resources” may not form the basis of feasibility or pre-feasibility studies. United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into mineral reserves. Investors are cautioned not to assume that all or any part of an “Inferred Mineral Resource” exists or is economically or legally mineable.
Disclosure of “contained pounds” or “contained ounces” in a resource estimate is permitted and typical disclosure under Canadian regulations; however, SEC Industry Guide 7 historically only permitted issuers to report mineralization that does not constitute “reserves” by SEC standards as in-place tonnage and grade without reference to unit measures. The requirements of NI 43-101 for identification of “reserves” are also not the same as those of SEC Industry Guide 7, and reserves reported by the Company in compliance with NI 43-101 may not qualify as “reserves” under SEC Industry Guide 7 standards. Accordingly, information concerning mineral deposits set forth herein may not be comparable to information made public by companies that report in accordance with SEC Industry Guide 7 standards.
On October 31, 2018, the SEC adopted the Modernization of Property Disclosures for Mining Registrants (the “New Rule”), introducing significant changes to the existing mining disclosure framework to better align it with international industry and regulatory practice including NI 43-101. The SEC adopted a two-year transition period for registrants to come into compliance with the New Rule. Accordingly, the Company will need to bring its disclosure into compliance in 2021. At this time, the Company does not know the full effect of the New Rule on its mineral resources and reserves and therefore the disclosure related to the Company’s mineral resources and reserves may be significantly different when computed using the requirements set forth in the New Rule.



7



PART I
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.

8



ENERGY FUELS INC.
Condensed Consolidated Statements of Operations and Comprehensive Loss
(unaudited) (Expressed in thousands of U.S. dollars, except per share amounts)
 
Three months ended
 
Six months ended
 
June 30,
 
June 30,
 
2020
 
2019
 
2020
 
2019
Revenues
 
 
 
 
 
 
 
Uranium concentrates
$

 
$
66

 
$

 
$
66

Vanadium concentrates

 
773

 
$

 
$
1,941

Alternate feed materials processing and other
395

 
2,232

 
788

 
2,734

Total revenues
395

 
3,071

 
788

 
4,741

Costs and expenses applicable to revenues
 
 
 
 
 
 
 
Costs and expenses applicable to uranium concentrates

 
63

 

 
63

Costs and expenses applicable to vanadium concentrates

 
928

 

 
1,460

Costs and expenses applicable to alternate feed materials and other

 
1,695

 

 
2,079

Total costs and expenses applicable to revenues

 
2,686

 

 
3,602

Other operating costs
 
 
 
 
 
 
 
Impairment of inventories
428

 
4,906

 
1,506

 
6,082

Development, permitting and land holding
60

 
1,399

 
737

 
5,741

Standby costs
2,729

 
1,251

 
4,653

 
2,335

Accretion of asset retirement obligation
478

 
481

 
956

 
994

Selling costs

 
127

 
12

 
137

General and administration
3,170

 
3,725

 
7,200

 
7,476

Total operating loss
(6,470
)
 
(11,504
)
 
(14,276
)
 
(21,626
)
 
 
 
 
 
 
 
 
Interest expense
(345
)
 
(362
)
 
(695
)
 
(691
)
Other (loss) income
(1,375
)
 
2,552

 
1,117

 
869

Net loss
(8,190
)
 
(9,314
)
 
(13,854
)
 
(21,448
)
 
 
 
 
 


 


Items that may be reclassified in the future to profit and loss
 
 
 
 

 

Foreign currency translation adjustment
(379
)
 
(771
)
 
(227
)
 
(907
)
Other comprehensive income (loss)
(379
)

(771
)

(227
)
 
(907
)
Comprehensive loss
$
(8,569
)
 
$
(10,085
)
 
$
(14,081
)
 
$
(22,355
)
 
 
 
 
 

 

Net loss attributable to:
 
 
 
 

 

Owners of the Company
$
(8,187
)
 
$
(9,312
)
 
$
(13,844
)
 
$
(21,439
)
Non-controlling interests
(3
)
 
(2
)
 
(10
)
 
(9
)
 
$
(8,190
)
 
$
(9,314
)
 
$
(13,854
)
 
$
(21,448
)
Comprehensive loss attributable to:
 
 
 
 

 

Owners of the Company
$
(8,566
)
 
$
(10,083
)
 
$
(14,071
)
 
$
(22,346
)
Non-controlling interests
(3
)
 
(2
)
 
(10
)
 
(9
)
 
$
(8,569
)
 
$
(10,085
)
 
$
(14,081
)
 
$
(22,355
)
 
 
 
 
 


 


Basic and diluted loss per share
$
(0.08
)
 
$
(0.10
)
 
$
(0.12
)
 
$
(0.23
)
See accompanying notes to the condensed consolidated financial statements.

9



ENERGY FUELS INC.
Condensed Consolidated Balance Sheets
(unaudited) (Expressed in thousands of U.S. dollars, except share amounts)
 
June 30, 2020
 
December 31, 2019

ASSETS
 
 
 
Current assets
 
 
 
Cash and cash equivalents
$
26,635

 
$
12,810

Marketable securities
1,682

 
4,838

Trade and other receivables, net
853

 
1,254

Inventories, net
26,576

 
22,808

Prepaid expenses and other assets
1,274

 
1,462

Total current assets
57,020

 
43,172

Inventories, net
1,149

 
1,149

Operating lease right of use asset
780

 
922

Investments accounted for at fair value
658

 
654

Property, plant and equipment, net
24,742

 
26,203

Mineral properties, net
83,539

 
83,539

Restricted cash
20,237

 
20,081

Total assets
$
188,125

 
$
175,720

 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
 
 
 
Current liabilities
 
 
 
Accounts payable and accrued liabilities
$
3,045

 
$
5,438

Current portion of operating lease liability
273

 
288

Current portion of asset retirement obligation
46

 
46

Current portion of loans and borrowings
15,613

 
16,866

Total current liabilities
18,977

 
22,638

Warrant liabilities
2,751

 
2,791

Operating lease liability
618

 
758

Asset retirement obligation
19,882

 
18,926

Total liabilities
42,228

 
45,113

Equity
 
 
 
Share capital
Common shares, without par value, unlimited shares authorized; shares issued and outstanding 120,534,705 at June 30, 2020 and 100,735,889 at December 31, 2019
523,196

 
493,958

Accumulated deficit
(383,880
)
 
(370,036
)
Accumulated other comprehensive income
2,762

 
2,989

Total shareholders' equity
142,078

 
126,911

Non-controlling interests
3,819

 
3,696

Total equity
145,897

 
130,607

Total liabilities and equity
$
188,125

 
$
175,720

 
 
 
 
Commitments and contingencies (Note 14)


 


See accompanying notes to the condensed consolidated financial statements.

10



ENERGY FUELS INC.
Condensed Consolidated Statements of Changes in Equity
(unaudited) (Expressed in thousands of U.S. dollars, except share amounts)
 
Common Stock
 
Deficit
 
Accumulated
other
comprehensive
income
 
Total
shareholders'
equity
 
Non-controlling
interests
 
Total equity
 
Shares
 
Amount
 
 
 
 
 
Balance at December 31, 2019
100,735,889

 
$
493,958

 
$
(370,036
)
 
$
2,989

 
$
126,911

 
$
3,696

 
$
130,607

Net loss

 

 
(5,657
)
 

 
(5,657
)
 
(7
)
 
(5,664
)
Other comprehensive loss

 

 

 
152

 
152

 

 
152

Shares issued for cash by public offering
13,688,815

 
20,658

 

 

 
20,658

 

 
20,658

Share issuance cost

 
(1,563
)
 

 

 
(1,563
)
 

 
(1,563
)
Share-based compensation

 
997

 

 

 
997

 

 
997

Shares issued for the vesting of restricted stock units
490,453

 

 

 

 

 

 

Cash paid to fund employee income tax withholding due upon vesting of restricted stock units

 
(415
)
 

 

 
(415
)
 

 
(415
)
Shares issued for consulting services
30,000

 
57

 

 

 
57

 

 
57

Contributions attributable to non-controlling interest

 

 

 

 

 
133

 
133

Balance at March 31, 2020
114,945,157

 
$
513,692

 
$
(375,693
)
 
$
3,141

 
$
141,140

 
$
3,822

 
$
144,962

Net loss

 

 
(8,187
)
 

 
(8,187
)
 
(3
)
 
(8,190
)
Other comprehensive loss

 

 

 
(379
)
 
(379
)
 

 
(379
)
Shares issued for cash by at-the-market offering
5,559,548

 
8,969

 

 

 
8,969

 

 
8,969

Share issuance cost

 
(202
)
 

 

 
(202
)
 

 
(202
)
Share-based compensation

 
704

 

 

 
704

 

 
704

Shares issued for consulting services
30,000

 
33

 

 

 
33

 

 
33

Balance at June 30, 2020
120,534,705

 
$
523,196

 
$
(383,880
)
 
$
2,762

 
$
142,078

 
$
3,819

 
$
145,897



11



 
Common Stock
 
Deficit
 
Accumulated
other
comprehensive
income
 
Total
shareholders'
equity
 
Non-controlling
interests
 
Total equity
 
Shares
 
Amount
 
 
 
 
 
Balance at December 31, 2018
91,445,066

 
$
469,303

 
$
(332,058
)
 
$
3,843

 
$
141,088

 
$
3,766

 
$
144,854

Net loss

 

 
(12,127
)
 

 
(12,127
)
 
(7
)
 
(12,134
)
Other comprehensive loss

 

 

 
(136
)
 
(136
)
 

 
(136
)
Shares issued for cash by public offering
754,712

 
2,471

 

 

 
2,471

 

 
2,471

Share issuance cost

 
(62
)
 

 

 
(62
)
 

 
(62
)
Share-based compensation

 
1,121

 

 

 
1,121

 

 
1,121

Shares issued for exercise of stock options
33,906

 
102

 

 

 
102

 

 
102

Shares issued for the vesting of restricted stock units
850,150

 

 

 

 

 

 

Shares issued for consulting services
18,848

 
52

 

 

 
52

 

 
52

Balance at March 31, 2019
93,102,682

 
$
472,987

 
$
(344,185
)
 
$
3,707

 
$
132,509

 
$
3,759

 
$
136,268

Net loss

 

 
(9,312
)
 

 
(9,312
)
 
(2
)
 
(9,314
)
Other comprehensive loss

 

 

 
(771
)
 
(771
)
 

 
(771
)
Shares issued for cash by at-the-market offering
2,141,817

 
6,595

 

 

 
6,595

 

 
6,595

Shares issued to settle liabilities
266,272

 
847

 
 
 
 
 
847

 
 
 
847

Share issuance cost

 
(151
)
 

 

 
(151
)
 

 
(151
)
Share-based compensation

 
663

 

 

 
663

 

 
663

Shares issued for exercise of stock options
20,899

 
44

 

 

 
44

 

 
44

Shares issued for exercise of warrants
1,450

 
5

 

 

 
5

 

 
5

Shares issued for consulting services
18,237

 
63

 

 

 
63

 

 
63

Contributions attributable to non-controlling interest

 

 

 

 

 
46

 
46

Balance at June 30, 2019
95,551,357

 
$
481,053

 
$
(353,497
)
 
$
2,936

 
$
130,492

 
$
3,803

 
$
134,295


See accompanying notes to the condensed consolidated financial statements.


12



ENERGY FUELS INC.
Condensed Consolidated Statements of Cash Flows
(unaudited) (Expressed in thousands of U.S. dollars)
 
Six months ended
 
June 30,
 
2020
 
2019
OPERATING ACTIVITIES
 
 
 
Net loss for the period
$
(13,854
)
 
$
(21,448
)
Items not involving cash:
 
 
 
Depletion, depreciation and amortization
1,104

 
625

Share-based compensation
1,701

 
1,784

Change in value of Convertible Debentures

 
493

Change in value of warrant liabilities
92

 
(1,115
)
Accretion of asset retirement obligation
956

 
994

Unrealized foreign exchange gain
(706
)
 
(216
)
Impairment of inventories
1,506

 
6,082

Revision of asset retirement obligation

 
151

Other non-cash expenses
647

 
974

Changes in assets and liabilities
 
 
 
Increase in inventories
(4,765
)
 
(7,079
)
Decrease in trade and other receivables
401

 
343

Decrease in prepaid expenses and other assets
188

 
541

Decrease in accounts payable and accrued liabilities
(3,100
)
 
(2,397
)
Changes in deferred revenue

 
(2,724
)
 
(15,830
)
 
(22,992
)
INVESTING ACTIVITIES
 
 
 
Purchase of mineral properties and property, plant and equipment
(152
)
 

Maturities and sales of marketable securities
3,203

 
16,116

 
3,051

 
16,116

FINANCING ACTIVITIES
 
 
 
Issuance of common shares for cash, net of issuance cost
27,862

 
8,853

Cash paid to fund employee income tax withholding due upon vesting of restricted stock units
(415
)
 

Repayment of loans and borrowings
(484
)
 

Cash received from exercise of warrants

 
5

Cash received from exercise of stock options

 
146

Cash received from non-controlling interest
133

 
46

 
27,096

 
9,050

CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH DURING THE PERIOD
14,317

 
2,174

Effect of exchange rate fluctuations on cash held in foreign currencies
(336
)
 
110

Cash, cash equivalents and restricted cash - beginning of period
32,891

 
34,292

CASH, CASH EQUIVALENTS AND RESTRICTED CASH - END OF PERIOD
$
46,872

 
$
36,576

Supplemental disclosure of cash flow information:
 
 
 
Net cash paid during the period for:
 
 
 
Interest
$
695

 
$
691

Warrant liability transferred to equity upon exercise
$

 
$
2

See accompanying notes to the condensed consolidated financial statements.

13



ENERGY FUELS INC.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 2020
(unaudited) (Tabular amounts expressed in thousands of U.S. Dollars, except share and per share amounts)
 
1.    THE COMPANY AND DESCRIPTION OF BUSINESS
Energy Fuels Inc. was incorporated under the laws of the Province of Alberta and was continued under the Business Corporations Act (Ontario).
Energy Fuels Inc. and its subsidiary companies (collectively “the Company” or “EFI”) are engaged in uranium extraction, recovery and sales of uranium from mineral properties and the recycling of uranium bearing materials generated by third parties. As a part of these activities the Company also acquires, explores, evaluates and, if warranted, permits uranium properties. The Company’s final uranium product, uranium oxide concentrate (“U3O8” or “uranium concentrate”), is sold to customers for further processing into fuel for nuclear reactors. The Company produces vanadium as a co-product of its uranium recovery from certain of its mines as market conditions warrant and from time to time from solutions in its tailing impoundment system. The Company is also evaluating potentially processing rare earth element ("REE") ores for the recovery of REEs and uranium.
The Company is an exploration stage mining company as defined by the U.S. SEC Industry Guide 7 as it has not established the existence of proven or probable reserves on any of its properties.
2.
BASIS OF PRESENTATION
The consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States (“U.S. GAAP”) and are presented in thousands of U.S. dollars, except for share and per share amounts. Certain footnote disclosures have share prices which are presented in Canadian dollars (“Cdn$”).
The condensed consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures included are adequate to make the information presented not misleading.
In management’s opinion, these unaudited condensed consolidated financial statements reflect all adjustments, consisting solely of normal recurring items, which are necessary for the fair presentation of the Company’s financial position, results of operations and cash flows on a basis consistent with that of the Company’s audited consolidated financial statements for the year ended December 31, 2019. However, the results of operations for the interim periods may not be indicative of results to be expected for the full fiscal year.  These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto and summary of significant accounting policies included in the Company’s annual report on Form 10-K for the year ended December 31, 2019.
The condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company accounts and transactions have been eliminated.
3.
MARKETABLE SECURITIES
The following table summarizes our marketable securities by significant investment categories as of June 30, 2020:

 
Cost Basis
Gross Unrealized Losses
Gross Unrealized Gains
Fair Value
Marketable debt securities(1)
$
993

$

$
14

$
1,007

Marketable equity securities
824

(580
)
431

675

Marketable securities
$
1,817

$
(580
)
$
445

$
1,682

(1) Marketable debt securities are comprised primarily of U.S. government notes, and also include U.S. government agencies and tradeable certificates of deposits.
The following table summarizes our marketable securities by significant investment categories as of December 31, 2019:


14



 
Cost Basis
Gross Unrealized Losses
Gross Unrealized Gains
Fair Value
Marketable debt securities (1)
$
4,171

$

$
37

$
4,208

Marketable equity securities
824

(543
)
349

630

Marketable securities
$
4,995

$
(543
)
$
386

$
4,838


(1) Marketable debt securities are comprised primarily of U.S. government notes, and also include U.S. government agencies, and tradeable certificates of deposits.
During the six months ended June 30, 2020 and 2019, we did not recognize any other-than-temporary impairment losses.
The following table summarizes the estimated fair value of our investments in marketable debt securities with stated contractual maturity dates, accounted for as available-for-sale securities and classified by the contractual maturity date of the securities:
Due in less than 12 months
$
1,007

Due in 12 months to two years

Due in greater than two years

 
$
1,007


4.
INVENTORIES
 
June 30, 2020
 
December 31, 2019
 Concentrates and work-in-progress(1)
$
24,771

 
$
20,893

 Inventory of ore in stockpiles
241

 
241

 Raw materials and consumables
2,713

 
2,823

 
$
27,725

 
$
23,957

Inventories - by duration


 


   Current
$
26,576

 
$
22,808

   Long term - raw materials and consumables
1,149

 
1,149


$
27,725

 
$
23,957

(1) For the three and six months ended June 30, 2020, the Company recorded an impairment loss of $0.43 million and $1.51 million in the statement of operations related to concentrates and work in progress inventories (June 30, 2019 - $4.91 million and $6.08 million).
5.
PROPERTY, PLANT AND EQUIPMENT AND MINERAL PROPERTIES
The following is a summary of property, plant and equipment:
 
June 30, 2020
 
December 31, 2019
 
Cost
 
Accumulated
Depreciation
 
Net Book Value
 
Cost
 
Accumulated
Depreciation
 
Net Book
Value
Property, plant and equipment
 
 
 
 
 
 
 
 
 
 
 
Nichols Ranch
$
29,210

 
$
(15,133
)
 
$
14,077

 
$
29,210

 
$
(14,115
)
 
$
15,095

Alta Mesa
13,626

 
(3,634
)
 
9,992

 
13,626

 
(3,179
)
 
10,447

Equipment and other
13,052

 
(12,379
)
 
673

 
12,900

 
(12,239
)
 
661

Property, plant and equipment total
$
55,888

 
$
(31,146
)
 
$
24,742

 
$
55,736

 
$
(29,533
)
 
$
26,203




15



The following is a summary of mineral properties:
 
June 30, 2020
 
December 31, 2019
Mineral properties
 
 
 
Uranerz ISR properties
$
25,974

 
$
25,974

Sheep Mountain
34,183

 
34,183

Roca Honda
22,095

 
22,095

Other
1,287

 
1,287

Mineral properties total
$
83,539

 
$
83,539


6.    ASSET RETIREMENT OBLIGATIONS AND RESTRICTED CASH
The following table summarizes the Company’s asset retirement obligations:
 
June 30, 2020
 
December 31, 2019
Asset retirement obligation, beginning of period
$
18,972

 
$
19,104

 Revision of estimate

 
(2,063
)
 Accretion of liabilities
956

 
1,931

Asset retirement obligation, end of period
$
19,928

 
$
18,972

Asset retirement obligation:
 
 
 
 Current
$
46

 
$
46

 Non-current
19,882

 
18,926

Asset retirement obligation, end of period
$
19,928

 
$
18,972


The asset retirement obligations of the Company are subject to legal and regulatory requirements. Estimates of the costs of reclamation are reviewed periodically by the Company and the applicable regulatory authorities. The above provision represents the Company’s best estimate of the present value of future reclamation costs, discounted using credit adjusted risk-free interest rates ranging from 9.5% to 11.5% and an inflation rate of 2.0%. The total undiscounted decommissioning liability at June 30, 2020 is $41.75 million (December 31, 2019 - $41.75 million).
The following table summarizes the Company’s restricted cash:
 
June 30, 2020
 
December 31, 2019
Restricted cash, beginning of period
$
20,081

 
$
19,652

Additional collateral posted
188

 
429

Restricted cash, end of period
$
20,237

 
$
20,081


The Company has cash, cash equivalents and fixed income securities as collateral for various bonds posted in favor of the applicable state regulatory agencies in Arizona, Colorado, New Mexico, Texas, Utah and Wyoming, and the U.S. Bureau of Land Management and U.S. Forest Service for estimated reclamation costs associated with the White Mesa Mill, Nichols Ranch, Alta Mesa and other mining properties. Cash equivalents are short-term highly liquid investments with original maturities of three months or less. The restricted cash will be released when the Company has reclaimed a mineral property or restructured the surety and collateral arrangements. See Note 14 for a discussion of the Company’s surety bond commitments.
Cash, cash equivalents and restricted cash are included in the following accounts at June 30, 2020 and December 31, 2019:
 
June 30, 2020
 
December 31, 2018
Cash and cash equivalents
$
26,635

 
$
12,810

Restricted cash included in other long-term assets
20,237

 
20,081

Total cash, cash equivalents and restricted cash
$
46,872

 
$
32,891


7.    LOANS AND BORROWINGS

16



The Company’s interest-bearing loans and borrowings, which are recorded at amortized cost, and the Company’s Convertible Debentures, which are recorded at fair value, are as follows.
 
June 30, 2020
 
December 31, 2019
Current portion of loans and borrowings:
 
 
 
Convertible Debentures
$
15,613

 
$
16,382

Notes payable

 
484

Total current loans and borrowings
$
15,613

 
$
16,866


On July 24, 2012, the Company completed a bought deal public offering of 22,000 floating-rate convertible unsecured subordinated debentures originally maturing June 30, 2017 (the “Convertible Debentures”) at a price of Cdn$1,000 per Debenture for gross proceeds of Cdn$21.55 million (the “Offering”). The Convertible Debentures are convertible into Common Shares at the option of the holder. Interest is paid in cash and in addition, unless an event of default has occurred and is continuing, the Company may elect, from time to time, subject to applicable regulatory approval, to satisfy its obligation to pay interest on the Convertible Debentures, on the date it is payable under the indenture: (i) in cash; (ii) by delivering sufficient common shares to the debenture trustee, for sale, to satisfy the interest obligations in accordance with the indenture in which event holders of the Convertible Debentures will be entitled to receive a cash payment equal to the proceeds of the sale of such common shares; or (iii) any combination of (i) and (ii).
On August 4, 2016, the Company, by a vote of the Debentureholders, extended the maturity date of the Convertible Debentures from June 30, 2017 to December 31, 2020, and reduced the conversion price of the Convertible Debentures from Cdn$15.00 to Cdn$4.15 per Common Share of the Company. In addition, a redemption provision was added that will enable the Company, upon giving not less than 30 days' notice to Debentureholders, to redeem the Convertible Debentures, for cash, in whole or in part at any time after June 30, 2019, but prior to maturity, at a price of 101% of the aggregate principal amount redeemed, plus accrued and unpaid interest (less any tax required by law to be deducted) on such Convertible Debentures up to but excluding the redemption date. A right (in favor of each Debentureholder) was also added which gave the Debentureholders the option to require the Company to purchase, for cash, on the previous maturity date of June 30, 2017, up to 20% of the Convertible Debentures held by the Debentureholders at a price equal to 100% of the principal amount purchased plus accrued and unpaid interest (less any tax required by law to be deducted). In the three months ended June 30, 2017, Debentureholders elected to redeem Cdn$1.13 million ($0.87 million) under this right. No additional purchases are allowed under this right. In addition, certain other amendments were made to the Indenture, as required by the U.S. Trust Indenture Act of 1939, as amended, and with respect to the addition of a U.S. Trustee in compliance therewith, as well as to remove provisions of the Indenture that no longer apply, such as U.S. securities law restrictions.
The Convertible Debentures accrue interest, payable semi-annually in arrears on June 30 and December 31 of each year at a fluctuating rate of not less than 8.5% and not more than 13.5%, indexed to the simple average spot price of uranium as reported on the UxC, LLC ("UxC") Weekly Indicator Price. The Convertible Debentures may be redeemed in whole or part, at par plus accrued interest and unpaid interest by the Company between June 30, 2019 and December 31, 2020 subject to certain terms and conditions, provided the volume weighted average trading price of the common shares of the Company on the TSX during the 20 consecutive trading days ending five days preceding the date on which the notice of redemption is given is not less than 125% of the conversion price.
Upon redemption or at maturity, the Company will repay the indebtedness represented by the Convertible Debentures by paying to the debenture trustee in Canadian dollars an amount equal to the aggregate principal amount of the outstanding Convertible Debentures which are to be redeemed or which have matured, as applicable, together with accrued and unpaid interest thereon.
Subject to any required regulatory approval and provided no event of default has occurred and is continuing, the Company has the option to satisfy its obligation to repay the Cdn$1,000 principal amount of the Convertible Debentures, in whole or in part, due at redemption or maturity, upon at least 40 days’ and not more than 60 days’ prior notice, by delivering that number of common shares obtained by dividing the Cdn$1,000 principal amount of the Convertible Debentures maturing or to be redeemed as applicable, by 95% of the volume-weighted average trading price of the common shares on the TSX during the 20 consecutive trading days ending five trading days preceding the date fixed for redemption or the maturity date, as the case may be.
On July 14, 2020, the Company redeemed Cdn$10.43 million principal amount of the Cdn$20.86 million Debentures. The Debentures were redeemable for an amount equal to 101% plus accrued and unpaid interest thereon, up to but excluding July 14, 2020. Following the partial redemption, Cdn$10.43 million aggregate principal amount of the Debentures remain outstanding and shall continue to be subject to the terms of the Indenture and remain listed on the Toronto Stock Exchange.
The Convertible Debentures are classified as fair value through profit or loss where the Convertible Debentures are measured at fair value based on the closing price on the TSX (a Level 1 measurement) and changes are recognized in earnings. For the three

17



and six months ended June 30, 2020, the Company recorded a loss on revaluation of Convertible Debentures of $0.47 million and $0.00 million (June 30, 2019 – gain of $0.94 million and loss of $0.49 million).
8.
LEASES
The Company’s leases primarily include operating leases for corporate offices. These leases have remaining lease terms of less than one year to four years, and include options to extend the leases for up to five years. Certain of our leases include variable payments for lessor operating expenses that are not included within right-of-use ("ROU") assets and lease liabilities in the Condensed Consolidated Balance Sheets. The Company’s lease agreements do not contain any material residual value guarantees or restrictive covenants.
Beginning January 1, 2019, operating ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Operating leases in effect prior to January 1, 2019 were recognized at the present value of the remaining payments on the remaining lease term as of January 1, 2019. Because most of the Company's leases do not provide an explicit rate of return, the Company's incremental secured borrowing rate based on lease term information available at the commencement date of the lease will be used in determining the present value of lease payments. For purposes of calculating operating lease liabilities, lease terms may be deemed to include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. The Company’s operating lease expense is recognized on a straight-line basis over the lease term and is recorded in General and Administration expenses. Short-term leases, which have an initial term of 12 months or less, are not recorded in the Condensed Consolidated Balance Sheets.
Total lease cost includes the following components:
 
Three months ended
June 30,

Six months ended
June 30,
 
2020

2019

2020

2019
Operating leases
$
89

 
$
105

 
$
184

 
$
210

Short-term leases
74

 
65

 
149

 
126

Sublease income

 
(28
)
 

 
(56
)
Total Lease Expense
$
163

 
$
142

 
$
333

 
$
280


 
The weighted average remaining lease term and weighted average discount rate were as follows:
 
Six months ended
June 30,
 
2020

2019
Weighted average remaining lease term of operating leases
2.9 years

 
3.7 years

Weighted average discount rate of operating leases
9.0
%
 
9.0
%


Supplemental cash flow information related to leases was as follows:
 
Three months ended
June 30,
 
Six months ended
June 30,
 
2020
 
2019
 
2020
 
2019
Operating cash flow information:
 
 
 
 
 
 
 
Cash paid for amounts included in the measurement of operating lease liabilities
$
101

 
$
56

 
$
196

 
$
138



Future minimum payments of operating lease liabilities as of June 30, 2020 are as follows:

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Years Ending December 31:
 
2020 (excluding the six months ended June 30, 2020)
$
170

2021
343

2022
350

2023