Q2 2025 Centrus Energy Corp Earnings Call

Operator: Greetings and welcome to the CENTRUS ENERGY CORP Q2 2025 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I'd now like to turn the call over to your host, Mr. Neal Nagarajan, Head of Investor Relations for CENTRUS ENERGY CORP. Thank you. You may begin.

Greetings and welcome to the centers energy Corps. Second quarter 2025 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation.

If anyone should require operator assistance during the conference, please press star zero on your telephone keypad.

As a reminder, this conference is being recorded.

I'd now like to turn the call over to your host, Mr. Neil.

Nagarajan head of investor relations for Centrist energy, Corp.

Neal Nagarajan: Good morning. Thank you all for joining us. Today's call will cover the results for the second quarter 2025 ended June 30th. Today we have Amir Vexler, President and Chief Executive Officer, and Kevin Harrill, Chief Financial Officer. Before turning the call over to Amir, I'd like to welcome all of our callers as well as those listening to our webcast. This conference call follows our earnings news release issued yesterday. We expect to file a report for the second quarter on Form 10-Q later today. All of our news releases and SEC filings, including our 10-K, 10-Qs, and A-Ks, are available on our website. A replay of this call will also be available later this morning on the CENTRUS website.

Thank you. You may begin.

Good morning, thank you all for joining us. Today's call will cover the results for the second quarter of 2025 and in June 30th.

Today we have a mere vexler president and chief executive officer and Kevin Harrell Chief Financial Officer.

Before turning the call over to Amir, I'd like to welcome all of our callers as well as those listening to our webcasts this conference call follows our earnings news release issued yesterday we expect to file a report for the second quarter on form 10q later today.

Neal Nagarajan: I would like to remind everyone that certain information we may discuss on this call today may be considered forward-looking information that involves risks and uncertainty, including assumptions around the future performance of CENTRUS. Our actual results may differ materially from those in our forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in our forward-looking statements is contained in our filings with the SEC, including our annual report on Form 10-K and quarterly reports on Form 10-Q. Finally, the forward-looking information provided today is time-sensitive and accurate only as of today, August 6th, 2025, unless otherwise noted. This call is the property of CENTRUS ENERGY. Any transcription, redistribution, retransmission, or rebroadcast of the call in any form without the express written consent of CENTRUS is strictly prohibited. Thank you for your participation, and now I'll turn the call over to Amir.

All of our news releases and SEC filings including our 10K, 10 q's and AKs are available on our website. A replay of this call will also be available later this morning on the Centrist website.

I would like to remind everyone that certain information. We may discuss on this call today may be considered for looking information that involves risk and uncertainty including assumptions around the future performance of centrists. Our actual results May differ materially from those in our forward-looking statements

Additional information concerning factors that could cause actual results to materially differ from those. In our forward, looking statements is contained in our filings with the SEC, including our annual report on form, 10K, and quarterly reports on form 102.

Finally, the forward-looking information provided today is time-sensitive and accurate. Only, as of today, August 6th 2025, unless otherwise noted.

Amir Vexler: Thank you, Neal, and thank you to everyone on the call today, both longtime listeners and the growing number of those joining us for the first time. In the second quarter, we again witnessed the continued rapid growth of the nuclear industry, driven by both government actions and private industry investments, providing us with great confidence in the mounting and lasting need for nuclear fuel in both the United States as well as abroad. Simply put, on the road to energy dominance, nuclear energy is being unleashed, and the critical fuel required to power this growth is at the center of this nuclear renaissance. Both the existing market for the commercial LEU and the future market for commercial HALU continue to expand at robust rates, backed by public actions and an increase in private financing sources.

This call is the property of centers energy. Any transcription redistribution retransmission, or rebroadcast of the call in any form. Without the express written consent of Centrist is strictly prohibited. Thank you for your participation. And now I'll turn the call over to Amir

Thank you, Neil and thank you to everyone on the call today, both longtime listeners and the growing number of bills joining us for the first time in a second quarter, we again witnessed the continued rapid growth of the nuclear industry driven by both government actions and Private Industry. Investments providing us with great confidence in the mounting and Lasting needs for nuclear fuel in both the United States as well as abroad.

Simply put on the road to energy dominance nuclear energy is being Unleashed and the critical fuel required to power. This growth is at the center of this nuclear Renaissance.

Both the existing market for the commercial Leu and the future market for commercial Halo, continue to expand and robust rates backed by public actions and an increase in private financing sources.

Amir Vexler: Similarly, we are witnessing a potentially significant expansion in our already large national security addressable market, with the growing number of announcements around potential micro and small modular reactor deployments on DOD side. These military reactors would likely require the use of U.S. origin enrichment technology, for which CENTRUS is the only commercially ready technology that can meet these demands. At a macro level, through the turmoil and uncertainty in the global trade environment, we continue to receive shipments of enriched uranium, and our operations have not been significantly impacted by macroeconomic events. Furthermore, as a reminder to our listeners, as we look to expanding our enrichment capacity, we manufacture our centrifuges in the United States by relying upon a secure, growing domestic manufacturing supply chain.

Similarly, we are witnessing a potentially significant expansion in our already large National Security, addressable market with the growing number of announcements around potential micro and small modular reactor deployments on DOD sites.

These military reactors would likely require the use of us origin, enrichment, technology for which Centrist is the only commercially ready, technology that can meet these demands.

The macro level.

Through the turmoil and uncertainty in global trade environment. We continue to receive shipments of enriched uranium and our operations have not been significantly impacted by macroeconomic events.

Amir Vexler: Turning to our results, as many of you know, there can be a significant amount of variability quarter to quarter due to the nature of our business. Customers in the LEU segment, which currently generate the majority of our revenue, generally have multi-year contracts to take delivery of a given quantity at a given price each year. But these customers choose when to take the delivery within the year and do not always choose the same quarter every year. Revenues and margins fluctuate depending on how many deliveries happen to fall into a particular quarter and whether those deliveries come from higher-priced or lower-priced contracts. And as such, we believe our annual results are more indicative of our progress. We again achieved robust financial results in the second quarter, including $154.5 million in revenue, a gross profit of $53.9 million, and an operating income of $33.5 million.

Furthermore as a reminder to our listeners. As we look to expanding our enrichment capacity, we manufacture our centrifuges in the United States by relying upon a secure growing domestic. Manufacturing supply chain.

As many of, you know, there can be a significant amount of variability quarter to quarter due to the nature of our business.

Customers and the Leu segment which currently generate the majority of our Revenue, generally have multi-year contracts to take delivery of a given quantity at a given price each year, but these customers choose when to take the delivery within a year and do not always choose the same quarter every year.

revenues and margins fluctuate, depending on how many deliveries happen to fall into a particular quarter and whether those deliveries come from higher price or lower price contracts,

And as such, we believe our annual results are more indicative of our progress.

Amir Vexler: Kevin will discuss the results and their respective drivers in more depth in a few minutes. We are currently awaiting the DOE's decision on how they plan to allocate the $3.4 billion appropriated to jumpstart domestic nuclear fuel production and how the awards will be structured. Given the administration's urgency and focus on energy dominance, we remain optimistic that a decision will be made soon. Consistent with this agenda, we believe that the only way to achieve nuclear energy dominance is to have a fully American technology and supply chain. We remain confident in our compelling investment case as the only publicly traded proven enricher that can meet commercial and national security needs, thereby maximizing the government's return on its investment. Our goal is to secure sufficient public and private capital to expand our enrichment capacity.

We again, achieve robust Financial results in a second quarter, including 154.5 million in Revenue, a gross profit of 53.9 million and an operating income of 33.5 million.

Kevin will discuss the results and their respective drivers in more depth in a few minutes.

We are currently awaiting, the Doe's decision on how they plan to allocate the 3.4 billion, appropriated to jumpstart domestic nuclear, fuel production, and how the awards will be structured.

Given the administration's urgency and focus on energy dominance. We remain optimistic that a decision will be made soon.

Consistent with this agenda, we will leave that the only way to achieve nuclear energy dominance is to have a fully American technology and supply chain. We remain confident in our compelling investment case, as the only publicly traded proven enricher that can meet commercial and national security needs, thereby maximizing the government's return on its investment.

Amir Vexler: As we await the DOE's decision, we continue to pursue our readiness initiatives to strengthen our investment case. First, we again grew our cash balance, ending the quarter with a healthy $833 million cash balance on our balance sheet. As we have previously noted, we will continue to look for ways to optimize our capital structure and strengthen our position ahead of government funding announcements to put CENTRUS in the best possible position once funding decisions have been made. Second, as announced in late November 2024, we launched a $60 million investment in our supply chain using CENTRUS's funds to lay the groundwork for the future large-scale deployment of our technology. To date, we have invested in facility readiness, procuring long lead items, and completing engineering designs. We also continue to hire and expand our talented workforce to make sure we are ready to start once an award is made.

Our goal is to secure sufficient public and private Capital to expand our enrichment capacity.

As we await the do's decision, we continue to pursue our Readiness initiatives to strengthen. Our investment case,

First, we again grew our cash balance and ending the quarter with a healthy 833 million cash balance on our balance sheet.

As we have previously noted, we will continue to look for ways to optimize our capital structure and strengthen our position ahead of government funding announcements to put Centrist in the best possible position. Once funding decisions have been made,

Second is announced in late November 2024. We launched a $60 million investment in our supply chain using sentence funds to lay the groundwork for the future. This is the large-scale deployment of our technology to date. We have invested in facility readiness, procuring long lead items, and completing engineering designs.

Amir Vexler: Third, we continue to successfully operate our HALU cascade at our Piketon, Ohio, facility under our contract with the U.S. Department of Energy, delivering HALU that the DOE urgently needs to help test the next generation of advanced reactors. CENTRUS achieved the 900 kilogram production milestone for phase two and to date has produced close to a metric ton of HALU for the department. In the quarter, the department also exercised an option to extend our contracts through June 30th, 2026. Our track record of successfully and safely meeting our targets on budget, as well as to receive the department's option to extend the contract, further validates our de-risk technology. Our technology has been proven with nearly 3 million machine hours and can meet the full range of America's commercial and national security enrichment requirements, including but not limited to LEU, LEU+, and HALU.

We also continue to hire and expand our talented Workforce to make sure we are ready to start. Once an award is made

third, we can continue to successfully operate our halo Cascade at our python Ohio facility.

Under our contract, with the US Department of energy delivering Halo that the deal. We urgently needs to help test the next generation of advanced reactors.

Centers achieved the 900 kg production milestone for Phase 2 and, to date, has produced close to a metric ton of Halo for the Department.

In the quarter, the department also exercised, an option to extend our contracts through June 30th 2026.

Amir Vexler: Furthermore, there is little cost differential to deploy and operate any of those cascades. Fourth, as we continue to successfully engage with key stakeholders to articulate our value proposition, we are also seeing clear signals at both the federal and state level that governments are looking to accelerate the deployment of civil nuclear energy to meet the growing demand for stable electricity. We are also seeing an increase in the pace of private market investments in securing nuclear power to fuel their future growth. There is a strong consensus among customers as well as policymakers that there is a need for another enricher to bring new supply and new competition to the market that is otherwise dominated by foreign state-owned enterprises. CENTRUS is proud to offer the free market, a publicly traded American source of enrichment services for commercial and national security needs.

Our track record of successfully and safely meeting our Targets on budget, as well as to receive the Department's option to extend the contract for the validates, our de-risked technology. Our technology has been proven with nearly 3 million machine hours and can meet the full range of America's commercial and National Security enrichment. Requirements, including but not limited to lau lau plus, and Halu for

Furthermore, there's little cost, differential to deploy and operate any of those Cascades.

Forth as we continue to successfully engage with key stakeholders to articulate our value proposition.

We are also seeing clear signals at both the federal and state level that governments are looking to accelerate the deployment of civil nuclear energy to meet the growing demand for stable electricity.

We are also seeing an increase in the pace of private market investments in securing new nuclear power to fuel their future growth.

The reason is a strong consensus among customers, as well as policymakers that there is a need for another enricher to bring new Supply and new competition to the market. That is otherwise dominated by Foreign state-owned Enterprises.

Amir Vexler: With that, I will turn the call over to Kevin to walk through the numbers. Kevin.

And National Security needs.

With that, I will turn the call over to Kevin to walk through the numbers. Kevin

Kevin Harrill: Thank you, Amir. Good morning, everyone. We're pleased to report another quarter of strong financial performance, fueled by solid execution across our operations and enhanced gross margins. This reflects continued discipline in cost management and the successful delivery of key contractual commitments. Total revenue for the second quarter was $154.5 million, a decrease of $34.5 million compared to the same quarter last year. Despite the revenue decrease, gross margin improved to 35%, up from 19% in the prior year's quarter, reflecting our focus on operational efficiency and a favorable shift in contractual mix. Total gross profit for the second quarter was $53.9 million compared to $36.5 million in the same quarter last year. Turning to the bottom line, net income for the second quarter was $28.9 million compared to $30.6 million in the same quarter last year.

Thank you are good morning, everyone. We're pleased to report another quarter of strong financial performance, fueled by solid execution across our operations, and enhanced gross. Margins, this reflects continued discipline and cost management and the successful delivery of key contractual commitments.

Total revenue for the second quarter was 154.5 million. A decrease of 34.5 million compared to the same quarter last year.

Despite the revenue, decrease gross margin improved to 35% up from 19% in the prior Year's quarter, reflecting our focus on operational efficiency and a favorable shift in contractual mix.

Total gross profit for the second quarter was 53.9 Million compared to 36.5%.

Kevin Harrill: We also generated $114.7 million in net proceeds under our ATM program during the quarter. As of June 30th, our cash and cash equivalents stood at $833 million, underscoring our strong liquidity and balance sheet discipline. This elevated cash position continues to generate considerable investment income, particularly in today's high-rate environment. In Q2, investment income reached $8 million, tripling the prior year reported amount. The income meaningfully contributed to our bottom line and reflects our commitment to maximizing returns on idle capital while maintaining flexibility for future growth opportunities. Our LEU business generated $125.7 million in revenue, which was a decrease of $43.9 million compared to the same quarter last year. The decrease in revenue for the second quarter was primarily driven by a reduction in SWU sales volume, as well as the absence of any sales from uranium during the period.

Turning to the bottom line, net income for the second quarter was 28.9 Million compared to 30.6 million in the same quarter last year.

We also generated 114.7 million in net proceeds under our ATM program during the quarter.

As of June 30th, our cash and cash equivalents stood at 833 million underscoring. Our strong liquidity and balance sheet discipline

This elevated cash position, continues to generate considerable investment income. Particularly in today's high rate environment,

In Q2 investment income, reached 8 million tripling, the prior year reported amount, the income meaningfully contributed to our bottom line and reflects our commitment to maximizing Returns on idle Capital while maintaining flexibility for future growth opportunities.

Our Leu business generated 125.7 million in Revenue which was a decrease of 43.9 million compared to the same quarter last year.

The decrease in revenue for the second quarter was primarily driven by a reduction in swoo sales volume as well as the absence of any sales from uranium During the period.

Kevin Harrill: LEU cost of sales for the second quarter was $75 million, a 45% decrease from $136.6 million in the same quarter last year. The decrease was primarily driven by a 27% reduction in SWU sales volume for the quarter. Customers typically operate under multi-year contracts with annual purchase commitments rather than quarterly obligations. As a result, quarterly sales volumes can vary significantly year over year depending on the timing of deliveries, even when annual volumes remain stable. For the six months ended June 30th, overall SWU sales volume is relatively on par with the prior year. Despite the lower volume in Q2, gross profit increased to $50.7 million, up from $33 million in the prior quarter. Variability in revenue and gross profit within our LEU business reflects the influence of market pricing at the time contracts are signed, coupled with the cost basis of inventory at the point of delivery.

Lau cost of sales for the second quarter was $75 million, a 45% decrease from $136.6 million in the same quarter last year.

The decrease was primarily driven by a 27% reduction in swoo sales volume for the quarter.

Customers typically operate under multi-year contracts with annual purchase commitments, rather than quarterly obligations. As a result quarterly sales volumes can vary significantly year-over-year depending on the timing of deliveries, even when annual volumes remain stable,

For the 6 months ended June 30th.

Overall, smooth sales volume is relatively on par with the prior year.

Despite the lower volume in Q2.

Gross profit, increase to 50.7 million up from 33 million in the prior quarter.

Kevin Harrill: In our technical solutions segment, revenue for the second quarter totaled $28.8 million compared to $19.4 million in the same quarter last year. Revenue increased by $9.4 million or 48%, primarily due to LEU feedstock and cylinder costs incurred to complete our contractual delivery under our HALU operation contract phase two. Cost of sales for the second quarter of 2025 was $25.6 million, an increase of $9.7 million or 61% compared to the same quarter in the prior year. Cost of sales increased in line with revenues. Gross profit for the technical solution segment was $3.2 million in the second quarter, a decrease of $0.3 million compared to the prior year's quarter. As previously disclosed, due to the delay in completing phase two of the HALU operation contract, the Department of Energy extended the phase two performance period to June 30th, 2025, effective November 24.

Variability in revenue and gross profit. Within our Lu business, reflects the influence of market pricing at the time. Contracts are signed coupled with the cost basis of inventory at the point of delivery.

In our Technical Solutions segment. Revenue for the second quarter total 28.8 million compared to 19.4 million in the same quarter last year.

Revenue increased by 9.4 million or 48%. Primarily due to Leu feed stock, and cylinder costs incurred to complete our contractual delivery under our halo, operation contract, Phase 2

Cost of sales for the second quarter of 2025 was 25.6 million and increase of 9.7 million, or 61% compared to the same quarter in the prior year.

Cost of sales increased in line with revenues.

Gross profit for the technical solution. Segment was 3.2 million in the second quarter. A decrease of 0.3 million compared to the prior Year's quarter.

As previously disclosed due to the delay in completing Phase, 2 of the Halo operation contract.

Kevin Harrill: However, the fee for the phase two extension has not yet been definitized and is currently under negotiation with the Department of Energy. As Amir mentioned earlier, in June 2025, we announced that we had successfully achieved the phase two production target under the HALU operation contract, contractually delivering 900 kilograms of HALU UF6. The DOE amended the HALU operation contract and exercised the first option period of phase three, which extended the contract through June 30th, 2026. The amendment also set the target cost and fee for the first option period at approximately $99.3 million and $8.7 million, respectively. DOE has the ability to exercise additional optional periods for up to eight additional years of production. As of June 30th, 2025, our total company backlog stood at approximately $3.6 billion, extending through 2040.

Department of energy, extended The Phase 2 performance period to June 30th, 2025 effective November 24th.

However, the fee for the phase 2 extension has not yet been definitive and is currently under negotiation with the Department of energy.

As a mere mentioned earlier. In June 2025 we announced that we had successfully achieved The Phase 2 production Target under the Halo operation contract, contractually delivering 900 kg of Haywood. Uf6.

Option period of phase 3, which extended the contract through June 30th 2026.

The amendment also sets a Target cost and fee for the first option period at approximately 99.3 million and 8.7 million respectively.

Doe has the ability to exercise additional off optional periods for up to 8 additional years of production.

Kevin Harrill: The LEU segment backlog was approximately $2.7 billion, which includes $0.6 billion in future SWU and uranium deliveries, primarily under medium and long-term contracts with fixed commitments, and $2.1 billion in contingent LEU sales commitments tied to the potential construction of LEU production capacity at our Piketon, Ohio, facility. We have now entered into definitive agreements for $1.7 billion of the $2.1 billion in contingent LEU sales commitments. The remaining contingent commitments are subject to our ability to secure significant public and private investment to support the development of LEU production capacity. Furthermore, this July, we secured an additional $0.1 billion in LEU contingent sales commitments under a definitive agreement. This brings our total contingent LEU sales commitments to $2.2 billion, with $1.8 billion being under definitive agreements. Our technical solutions segment backlog was approximately $0.9 billion and includes funded amounts, unfunded amounts, and unexercised options.

As of June 30th 2025 are total company. Backlog stood at approximately 3.6 billion extending through 2040. The Leu segment backlog was approximately 2.7 billion, which includes 0.6 billion in future swoo and uranium deliveries, primarily under medium and long-term contracts with fixed commitments and 2.1 billion in contingent daily use sales. Commitments tied to the potential construction of Leu production capacity at our Pike in Ohio facility.

We have now entered into definitive agreements for 1.7 billion of the 2.1 billion, in contingent Leu sales commitments.

The remaining contingency commitments are subject to our ability to secure significant public and private investment to support the development of Leu production capacity.

Furthermore this July we secured an additional 0.1 billion in Leu contingent sales commitments under a definitive agreement, this brings our total contingent Leu sales commitments, to 2.2 billion with 1.8 billion, being under definitive agreements.

Kevin Harrill: The unexercised options pertain to the HALU operation contract and represent potential future work subject to DOE direction and funding availability. In addition, the company has continued to pursue initiatives aimed at strengthening its capital structure, enhancing financial flexibility to support both near-term operations and long-term growth objectives. As noted earlier, in the second quarter of 2025, our ATM program generated an additional $114.7 million in net proceeds. These proceeds, along with gross margin contributions, resulted in an ending cash balance of $847 million as of June 30th, 2025, which includes $14 million of restricted cash. The company's continued strong cash position furthers to support the execution of near-term contractual obligations and enables strategic investments in our long-term future.

Our technical solution segment backlog was approximately 0.9 billion and includes funded amounts unfunded amounts and unexercised options.

The Unis options pertain to the Halo operation contract and represent.

Potential future work subject to doe Direction and funding availability.

In addition, the company has continued to pursue initiatives aimed at strengthening, its capital structure enhancing Financial flexibility to support support. Both near-term operations and long-term growth objectives.

as noted earlier in the second quarter of 2025, our ATM program, generated an additional 114.7 million in net proceeds

These proceeds along with gross margin contributions. Resulted in an ending cash balance of 847 million as of June 30th 2025 which includes 14 million of restricted cash.

Kevin Harrill: As previously announced, this includes a planned investment of approximately $60 million for manufacturing readiness at our Piketon, Ohio, plant, laying the foundation for a potential large-scale expansion of uranium enrichment capabilities. These achievements build on the momentum established in 2024 and the first quarter of 2025, as we continue to successfully operate our HALU cascade under the contract with the Department of Energy. At the same time, we are actively pursuing investments in our manufacturing capabilities while awaiting the DOE's decision on the allocation of $3.4 billion appropriated to jumpstart domestic nuclear fuel production. This quarter's accomplishments and initiatives have further strengthened CENTRUS's position to execute its long-term strategy of securing sufficient public and private funding. The goal is to deploy our advanced technology at scale and help restore America's domestic uranium enrichment capability. With that, let me turn things back over to Amir.

The company's continued strong cash position. Furthers to support the execution of near-term, contractual obligation and enables strategic investments in our long-term future.

As previously announced this includes a planned investment of approximately 60 million for manufacturing Readiness. At our pipe. In Ohio plan laying the foundation for a potential large scale. Expansion of uranium enrichment capabilities.

These achievements build on the momentum established in 2024 and the first quarter of 2025 as we continue to to successfully operate our halo Cascade under the contract with the Department of energy.

At the same time, we are actively pursuing investments in our manufacturing capabilities, while awaiting the Doe's decision on the allocation of 3.4 billion, appropriated to jumpstart domestic nuclear fuel production.

This quarter's accomplishments and initiatives have further strengthened centric's position to execute its long-term strategy of securing sufficient public and private funding.

The goal is to deploy, our advanced technology at scale and help restore America's domestic uranium enrichment capability.

With that, let me turn things back over to Amir.

Amir Vexler: Thanks, Kevin. I'd like to close by reminding our investors and listeners of the imperative need to both reduce our dependence on foreign nations and to inject more competition into the market to provide customers with more alternatives. This is especially important given recent announcements from both the public and private sectors on their respective goals for near-term nuclear deployment. The public and private markets are arguably more aligned today than they ever have been. At the federal level, the administration's May executive orders clearly served as strong tailwinds for an already robust and growing nuclear market. These included reducing the time to market required to deploy both large and small modular reactors, as well as raising the bar and setting a goal of quadrupling nuclear output by 2050.

Thanksgiving.

I'd like to close by reminding our investors and listeners of the imperative need to both reduce our dependence on foreign Nations and to inject more competition into the market to provide customers work with more alternatives.

This is especially important given recent announcements from both the public and private sectors on their respective goals for near-term. Nuclear deployment.

The public and private markets are arguably more aligned today than they ever have been.

At the federal level, the administration's May executive orders. Clearly served a strong Tailwind for an already robust and growing nuclear Market.

Amir Vexler: We also expect to see an increase in demand for nuclear assets as a direct result of the administration's identification of artificial intelligence as a national security imperative. The President recently unveiled a $70 billion AI and energy plan, which will likely require nuclear power. More recently, the House passed the GENIUS Act to regulate stablecoins. As many know, stablecoins and cryptocurrency mining require a vast amount of computational power. These are but some of the examples that are driving an ever-growing need for safe, reliable nuclear energy and therefore a domestic source of nuclear fuel, and CENTRUS stands ready to meet this demand. The push to expand nuclear isn't just coming at the federal level. In New York, Governor Hochul directed the state's power authority to build their first new nuclear plant in decades. In Wisconsin, Governor Evers signed legislation to begin identifying sites for new reactors.

These included reducing the time to Market required to deploy, both large and small modular reactors, as well as raising the bar and setting a goal of quadrupling nuclear outputs by 2050. We also expect to see an increase in demand for nuclear assets as a direct result of the administration's identification of artificial intelligence as a national security imperative.

Recently unveiled, a $700 billion AI and energy plan, which will likely require nuclear power. More recently, the House passed the Genius Act to regulate stablecoins.

As many know, stable coins and cryptocurrency Mining require a vast amount of computational power

These are but some of the examples that are driving in an Ever growing need for safe, reliable nuclear energy and therefore a domestic source of nuclear Fuel and C stands, ready to meet this demand.

The push to expand. Nuclear isn't just coming at the federal level.

Amir Vexler: And in Texas, Governor Abbott signed legislation establishing a $350 million fund to support nuclear construction projects. These mandates further underscore the need for a resilient domestic fuel supply chain. Finally, we are seeing private industry stepping in and making strong commitments to, as well as putting hard dollars behind nuclear investment. Announcements and agreements like Amazon and Talent Energy's 1.9 gigawatt long-term power purchase agreement, Microsoft's Three Mile Island agreement, Meta's 20-year agreement to buy nuclear power from Constellation Energy, and Westinghouse's commitment to build 10 large reactors in the U.S. demonstrate that the barriers that previously impeded nuclear assets' deployments are being broken. Furthermore, they underscore how private financing can serve as a bridge in the funding gap, representing an exciting new avenue to access private capital that previously did not exist. In short, our addressable market for domestic commercial LEU and HALU continues to grow.

In New York, Governor hoco directed. The state's Power Authority to build their first new nuclear plant. In decades, in Wisconsin, governor Evers. This signed legislation to begin identifying sites for new reactors. And in Texas, governor Abbott signed legislation establishing a 350 million fund to support nuclear construction projects.

These mandates further underscore the need for resilient domestic fuel supply chain.

Finally, we are seeing Private Industry stepping in and making strong commitments to as well as putting hard dollars behind nuclear Investments.

Announcements and agreements like Amazon and talent energies 1.9 gigawatt long-term power purchase agreement. Microsoft 3, Mile Island agreement, meta's 20-year agreement to buy nuclear power from Constellation Energy and Westing houses commitment to build 10, large reactors in the US.

Demonstrate that the barriers that previously impeded nuclear assets deployments are being broken.

Furthermore they underscore how private financing conserved?

As a bridge in the funding Gap, representing an exciting new Avenue to access private Capital that previously did not exist.

Amir Vexler: Our addressable national security market is potentially growing, and we are now seeing private markets stepping in with creative solutions to secure their access to nuclear power, something that could be consequential for CENTRUS as part of our public-private partnership plan. It is an exciting time in the nuclear industry, and CENTRUS is positioned to meet the markets, the nations, and our taxpayers' needs with a proven technology and a domestic supply chain. I would like to close by thanking our growing list of investors, analysts, and listeners, without whom none of this would be possible. We look forward to updating you on our progress on our next earnings call. With that, we are happy to take questions. Operator.

In short, our addressable market for domestic commercial Leu and Halo continues to grow. Our addressable National Security Market is potentially growing, and we are now seeing private markets stepping in with Creative Solutions, to secure their access to nuclear power. Something that could be consequential for centuries as part of our public. Private partnership plans,

It is an exciting time in the nuclear industry and Centrist is positioned to meet the markets, the Nations, and our taxpayers need with a proven technology and a domestic supply chain.

I would like to close by thanking our growing list of investors, analysts and listeners without whom none of this would be possible. We look forward to updating you on our progress on our next earning call with that.

We are happy to take questions. Operator?

Operator: Thank you. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. In the interest of time, we ask that you each keep to one question and one follow-up. Thank you. Our first question comes from the line of Ryan Fisch with B. Riley Securities. Please proceed with your question.

Thank you. If you'd like to ask a question. Please press star 1 on your telephone keypad. Our confirmation tone will indicate your line is in the question queue.

You may press star 2. If you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

In the interest of time, we ask that you each keep to 1 question and 1 follow up. Thank you.

Our first question comes from the line of Ryan fist with B Riley Securities. Please proceed with your question.

Ryan Pfingst: Hey, guys. Thanks for taking my questions. The first one is, do you expect to see federal programs stemming from May's executive orders that would be incremental to the DOE's enrichment awards that you were selected for last year that could help fund or otherwise support your capacity expansion?

Hey guys, thanks for taking my questions. Um, the first one is, do you expect to see federal programs stemming from May's executive orders that would be incremental to the DOE's enrichment awards that you were selected for last year, that could help fund or otherwise support your capacity expansion?

Amir Vexler: Good. Good question. Thank you for that. We really don't have any information. I will say that the executive orders, as you pointed out, are a strong, strong support for what we do, not only for the industry, but specifically for nuclear fuel. So although I don't know if there's anything incremental that is in play, we don't have any information on that. But just the fact that these orders were out there are providing huge support for what we do.

Good. Good question. Thank you for that. Um,

We we really don't have any information. Uh I will say that the executive orders as you pointed out, are a strong strong support for what we do, not only for the industry, but specifically for nuclear fuel.

So, um, although I don't know if there's anything incremental that that is in play. Um, we we we don't have any information on that, but, uh, just the fact that these orders were were out there are providing huge support for, for what we do.

Ryan Pfingst: Got it. Thanks for that, Amir. And then for the $60 million investment in centrifuge manufacturing activities and supply chain readiness that you mentioned, curious how that's progressing and when might we see that show up in earnest in the financial statements?

Got it. Thanks for that Amir and and then for the million dollar investment and centrifuge, manufacturing activities, and supply chain Readiness, that you mentioned.

uh, Curious how that's progressing and and when might we see that show up, um, in Earnest in the financial statements,

Amir Vexler: I'll answer the first part of your question and let Kevin maybe answer the second part of the question. So if things are going well, as you know, we have kicked off this effort towards the end of last year. I'm really glad that we did. We are going through the process of ordering long lead items, making sure that we fine-tune in our cycle times as required, all in preparation of a large centrifuge build. And so we're also going through first article manufacturing as part of it as well. All in all, it's progressing well. The team is reporting regularly on it, and I will let Kevin answer the question around where and when it may show up.

Really glad that we did. Um, we are going through the process of ordering long lead items, making sure that we

Fine-tune in our cycle times as required. All in preparation of a large centrifuge build. And so um we're also going through first article manufacturing as part of it as well.

Kevin Harrill: Yeah. And as a reminder, this was an 18-month initiative that we announced late last year. So it's actually running through our financials today through our CapEx, as well as increases associated with advanced technology costs. There are other aspects that we are working on associated with building up the workforce in anticipation of the larger build. And so we also have some costs that are actually running through other avenues within our financial statements today. But as noted, we do see this as an 18-month project. So we'll continue to have variability in costs in all of the three categories that I just outlined.

All in all it's progressing. Well, uh, the team is reporting regularly on it and I will let Kevin answer the question around where, and when it may show up,

Yeah. And and as a reminder, this was a 18-month initiative that we announced late last year. So um, it's actually running through our financials today through our capex.

As well as increases associated with advanced technology costs. Um, there are other aspects that we are working um associated with building up the workforce and anticipation of the larger build. And so we are we also have um some costs that are actually running through um other avenues within our financial statements today. Uh but as noted we we do see this as an 18-month project so we'll continue to have um variability and costs and all of the 3 categories that that I just outlined

Ryan Pfingst: Great. I appreciate that detail. I'll turn it back.

Kevin Harrill: Absolutely. Thank you, Ryan.

Great, I appreciate that detail. I'll turn it back.

Absolutely. Thank you, Ryan.

Operator: Thank you. Our next question comes from the line of Rob Brown with Lake Street Capital Markets. Please proceed with your question.

Thank you. Our next question comes from the line of Rob Brown with leek Street Capital markets. Please proceed with your question.

Rob Brown: Good morning. Congratulations on the progress.

Uh, good morning and congratulations on the progress.

Ryan Pfingst: Thanks, Rob.

Rob Brown: I'd like to get a little more color on the I think there's some new commitments for the LEU contingent backlog of $100 million. What's sort of the opportunity there in terms of additional customer commitments? And $1.8 billion backlog is pretty good. But how do those you know what's the opportunity for additional commitments as you kind of ramp into your LEU production?

Thanks to.

Make a little more color on the, there's some new commitments, uh, for the Leu contingent, uh, backlog of 100 million. What, what sort of the opportunity there in terms of additional customer commitments and, and, uh, you know, 1.8 billion back looks pretty good. But, uh, how, how, how do those you know, what's the opportunity for additional commitments? As you as you kind of ramp into your Leu production?

Amir Vexler: Let me give you a general answer on this. Obviously, as in the past, all these agreements cover under non-disclosures. We're not really revealing it. And I don't think you're asking about the identity of any specific utility. So obviously, that's not anything we have disclosed before, and we're not going to disclose that. But to your question, these agreements are important to us as we size up our plant, as we build out our capability to enrich. Customer commitments are crucial. As you pointed out correctly, we've added some, and we are continually working with other customers to continue growing that backlog. I'm not sure there's anything else I could add to it other than just reemphasizing again that that is a business imperative for us.

um, let me give you a, a general answer on this obviously as as in the past um

All these agreements, um, go around the non-disclosures. We, we're not really revealing and, and I don't think you're asking about the identity of any, any specific utility. So um, obviously that's not anything we have disclosed before and we are not going to disclose that but to your question, um, these Agreements are important to us um, as we sized up our plan as we

Build out our capability to enrich. Customer commitments are crucial. Um, as you as you pointed out correctly, we we've added some and we are continually working with other customers to continue growing that that backlog.

Um, I'm not sure if there's anything else I could add to it. Other than just re-emphasizing again that that is a business imperative for us.

Rob Brown: Great. Thank you. And then on the HALU phase three extension, do you expect to continue producing sort of at the same rate of physical production there until some DOE decisions are made? Or how do you sort of see that fitting in with the DOE kind of next steps?

Great, thank you. And then the Halo phase 3 extension. Uh, do you expect to continue producing sort of at the same rate, um, of physical production there, until until some day we decisions are made or, or how do you sort of see that, um,

Uh, fitting in with the doe.

Amir Vexler: Yeah. So to answer your first question, yeah, it's business as usual as far as enrichment goes. The plant is operating. We're enriching at a certain rate, and we'll continue to enrich at that rate. I hope I answered your question. Please let me know if I haven't.

Yes, so to answer your first question. Yeah, we...

It's business, as usual, as far as enrichment goes. Um, the plant is operating, we're enriching at a certain rate, we'll continue to enrich us at that rate. Um,

I hope I answered your question please. Um, let me know if I haven't.

Rob Brown: Yeah. That was great. I'll turn it over. Thank you.

Amir Vexler: Thank you.

That was great. I'll turn it over. Thank you.

Operator: Thank you. Our next question comes from the line of Joseph Rieger with Roth Capital Partners. Please proceed with your question.

Thank you, thank you. Our next question comes from the line of Joseph Ruger with Roth Capital Partners, please proceed with your question.

Rob Brown: Hi, Amir and team. Thanks for taking the question. So just some questions on the balance sheet and just kind of general thoughts. The balance sheet is pretty robust at this point. Is there any opportunity for you guys to start moving forward with a smaller build-out of a low-enriched facility, you know, using your existing funds and maybe whatever's left on the ATM while you wait for the government to make a decision, or in the event that the government decides to appropriate less funds than necessary to you guys or, you know, less than you expect?

Hi, mayor and team. Uh, thanks for taking the questions. Um,

So, just some questions on the balance sheet and just to kind of General thoughts. Um, the balance sheet is pretty robust at this point. Is there any opportunity for you guys to start moving forward with say, um, a smaller build out of a low-enriched facility? Um, you know, using your existing funds and maybe whatever's left on the ATM while you wait for the government to make a decision or in the event that the government decides to appropriate less funds than necessary to you guys or, you know, less than you expect.

Amir Vexler: Good question. What you described is exactly the sort of things that we're continually evaluating based on the Department of Energy's decision, based on our conversations with our customers. I can't really point one way or the other, but these are the things that we evaluate regularly. The $60 million readiness that we have kicked off has obviously been done with ensuring that we can execute quickly and rapidly should a decision like that be made. So apologies that I can't give you a more specific answer. I would just repeat again that you're asking exactly the same things that we are continually evaluating.

Um, good question, what you described is?

Exactly. This sort of things that we're continually evaluating, um, based on Department of energy decision based on our conversations with our customers.

um,

But these are the things that we evaluate regularly, um, the 60 million Readiness that that we have kicked off. Um, is is obviously done has been done with ensuring that we can execute quickly and rapidly through the decision like that be made.

So apologies that I can't give you a more specific answer. Um, I would just repeat again that, um, you, you're asking exactly the the same things that we are continually evaluating.

Rob Brown: Okay. Fair enough. And then on the ATM, can you remind us what's remaining on your current ATM?

Okay, fair enough. And and then on the ATM, can you, uh, remind us what's remaining on your current ATM?

Kevin Harrill: So there's nothing remaining on the ATM. We have exhausted what was currently out there. And certainly, I think the follow-up question, I assume, will be, what are we evaluating at a go-forward perspective? And I think what I would tell you is we're very encouraged by the progress within the market, and we're evaluating what's next steps. We can't directly comment on any potential transactions, but I would say we're definitely doing what is necessary to maintain our financial flexibility and be in a position to execute on our strategy as we look forward to potential DOE announcements.

Uh, so there's nothing remaining on the ATM. We have exhausted. What was currently out there? Um,

And certainly, um, I think the follow-up question I assume, uh, will be: what are we evaluating?

Um, at a go forward perspective. And I and I think what I would tell you is, um, we're very encouraged by, you know, the progress within the market. And, you know, we're evaluating, you know, what's next steps? We can't directly comment on any potential transactions, but I would say we're, we're definitely, um, doing what is necessary to to maintain our financial flexibility and and be in a position to execute on our strategy. Um, as we look forward to potential, doe announcements

Rob Brown: Okay. Fair enough. I'll turn it over. Thanks.

Okay, fair enough. I'll turn it over. Thanks.

Operator: Thank you. Our next question comes from the line of Vikram Bagre with CITI. Please proceed with your question.

Thank you. Our next question comes from the line of vicram Barry with City, please, proceed with your question.

Sameer Joshi: Good morning, everyone. I wanted to follow up on the last question. It sounds like you're strengthening the balance sheet ahead of government funding enough that whatever the IDIQ capital is and whatever the cap required for 96 cascades, you can fill the gap using your own balance sheet. I was wondering if you can highlight what the target amount of capital is on the balance sheet that you want over the next three, six months or one year. What's the sort of like the target cash on balance sheet if there is a target?

Good morning, everyone. I want you to follow up on the, uh, on the last question. It sounds like, um, you're strengthening the balance sheet ahead of government funding enough that whatever the idea, IQ Capital is, and whatever the capital required for 96 Cascades, as you can fill the gap using your own balance sheet. I was thinking, if you can highlight what the target amount of capital is on the balance sheet that you want to, you know, over the next 3, 6 months or 1 year, what's the sort of like the target cash and balance sheet? If there is a target.

Kevin Harrill: Yeah, that's a great question. Unfortunately, we don't get into details as it relates to what the costs are from a capital build perspective for a lot of reasons, including just the aspect that it's highly sensitive from a business proprietary perspective. But what I would say is we do have a fulsome business strategy that we have outlined with a variety of sensitivity analyses as it relates to what we need from the government to build out using a public-private partnership. And you mentioned the 96 cascades. It's important to note that what we have right now from an infrastructure perspective is we can build out 48. We would need to expand in order to double that. So our main focus is to build out the existing building and marry both public and private funds in order to facilitate a positive return for investors.

Yeah, that that that's a great question. Unfortunately, we don't get into details. Um, as it relates to what the costs are from a capital build perspective, um, for a lot of reasons. Um, including, uh, just just the aspect. That, that is that's highly sensitive. Um, from a business provider perspective, but what I would say is we do have a

Kevin Harrill: And so we're balancing what we will ultimately need based upon the incoming funds coming from the government through a variety of potential opportunities. Was that helpful, Vikram?

A fulsome business strategy that we have um, outlined with a variety of sensitivity analyses as it relates to what we need from the government um to build out using a public private partnership. And you mentioned the the 96 Cascades. It's important to note that what we have right now. Um from an infrastructure perspective is we can build out 48. We would need to expand in order to double that. So our main focus is to build out the existing building um and Mary both public and private um, funds in order to facilitate a positive return for investors. And so we're balancing what we will ultimately need uh based upon the incoming funds coming from the government um through a variety of of of potential opportunities.

Sameer Joshi: That's very helpful. Yeah, that's very helpful. Thanks a lot. As a follow-up, your two quarters are a pretty meaningful beat on the results. I appreciate your comment about timing of SWU sales and pricing impacting earnings. We have different contracts with different customers. I appreciate that the full-year view provides a more holistic picture of profitability. Can you share directionally where the profitability of the entire portfolio as a whole is currently? I saw the pricing increase 24% year-on-year. Cost was down 8%. As we stand today, when you look at the portfolio, the SWU portfolio, the backlog that you have, what's the sort of the profitability of those contracts given current pricing?

Was that helpful, this very helpful? Yeah, that's very helpful. Thanks a lot, uh, as a follow-up. Uh, you 2 quarters of pretty, meaningful beat uh, on the results. Uh, appreciate the comment about timing of Sue sales and pricing impacting your names, and you have different contracts with different customers. Um, um, appreciate that. You know, fully your view provides a more holistic, picture of profit profitability, can you share directionally where the profitability of the entire portfolio as a whole is currently, I saw the pricing increased 24%, year-on-year, courses down 8% as we stand today. When you look at the portfolio, the Sue portfolio, the backlog that

You have what's the sort of the profitability of those contracts? Uh, given current pricing

Kevin Harrill: Yeah. So what we've spoken about in the past is that much of the backlog that we have ranges from when the SWU market, from a commodity pricing perspective, was low, as well as at its highest point. And we are now at a point in time where we sell into a higher market with our customers, but we also have impacts as it relates to our cost structure. What I would say is, as you noted, you know we did have a very strong quarter with profit at approximately 40%. So I think what this demonstrates is that we continue to realize good margins within this market, but I wouldn't say that should be interpreted as an indication of future margin realization.

Yeah, so so what we've spoken about in the past is that much of the backlog that we have um, ranges from when the sum Market from a commodity pricing perspective was low as well as at its highest point. And we are now at a point in time, where we sell into a higher Market um, with our customers. But but we also have uh, impacts as it relates to our cost structure. What I would say is as you noted, you know, we did have a very strong quarter, um, with profit at approximately 40%.

Kevin Harrill: We do not provide earnings guidance or disclose the mix of the contracts, so I can't get into details on what future quarters or even future years will look like. But I will tell you it is reasonable to expect margin levels to remain within the range we've seen over the past few years. But from a quarterly perspective, you will see variability, but we are on target with regards to our own internal annual outlook. And obviously, we don't disclose that with not providing future guidance, but we are on track with regards to our own internal projections.

Uh, but I wouldn't say that should be interpreted as an indication of future margin real realization. Um, we we, we do not provide earnings guidance or disclose the mix of the contract, so I can't get into details on what, um, future quarters or even future years will look like, but I will tell you it is reasonable to expect margin levels to remain within the range. We've seen over the past few years. Um but from from a quarterly perspective you will see variability but we are on target with regards to our own internal annual Outlook and and obviously we don't disclose that with not providing uh future guidance but but we are on track with regards to our own internal projections.

Sameer Joshi: Thank you. We turn it back.

Thank you.

Kevin Harrill: Thank you.

Thank you.

Operator: Thank you. Our next question comes from the line of Doshi with HC Wainwright. Please proceed with your question.

Thank you. Our next question comes from the line of roshi with HC Wayne Wright please proceed with your question.

Sameer Joshi: Hey, good morning, guys. Congrats on the good progress. Many of the questions have been addressed, but just a few questions. In the first two quarters, there have been no uranium sales, and of course, we understand it depends on timing of customers when they put their orders. But should we expect the next two quarters to show some level of uranium sales to come on par annual levels that you have seen in the past?

Hey, good morning uh guys. Uh, congrats on the good progress.

Uh, many of the questions have been addressed but just uh, a few uh questions.

Um, uh, in the first 2 quarters there have been no uranium sales. And of course, we understand uh, it depends on timing of, uh, customers so when they put their orders. But should we expect the next 2 quarters, uh, to show, uh, some level of uranium sales, um, to come, uh, on, on for annual levels that you have seen in the past?

Kevin Harrill: Yeah, thanks for the question. Again, unfortunately, we don't provide any guidance or details on individual shipments, whether it's SWU or uranium. But what I would say and reiterate my previous point is, from an overall perspective, as it relates to our revenue, we believe that we're on track with our internal projections. So I couldn't, but I couldn't get into any specifics as it relates to any uranium sales and when we would be able to or desire to execute those as it relates to the remaining inventory that we have on hand for UF6.

Yeah, thanks for the question. Um, again, unfortunately, we we, we don't provide any guidance or details on individual shipments, whether it's woo or uranium. Um, but what I would say and reiterate my, my previous point is from an overall perspective, uh, as it relates to our Revenue. We we we believe that we're on track with our internal projections so I couldn't but I couldn't get into any specifics, um, as it relates to, to any uh, uranium sales and and when we would be able to or desire to execute those, um, as it relates to to the remaining inventory that we have on hand for uf6,

Sameer Joshi: That's fair. I understand. So coming to the HALU operations contract, you have sort of visibility, of course, for the next year, but also the option 1B could give you another two years. It falls in this around 263, so around 80 to 90 million annual run rate. This year, it might be over 100. Is there an expectation of that contract increasing and for you to increase your HALU processing capabilities? And is there any CapEx planned or anticipated for that in future years?

That's it. And I, I understand. Uh, so coming to the Halo operations contract, uh, uh, you have sort of visibility, of course, for the next year, but also the option 1 be, uh, could give you another 2 years. Uh, it it, it, it falls in this, uh, 263 so around 80, uh, to 90 million, uh, uh, annual run rate this year, might be over 100, uh, is there, uh, expectation of, uh, that contract increasing and for you to increase in your Halo processing? Uh, capabilities? Um, and is there any capex uh planned or uh anticipated for that in future years?

Amir Vexler: I'll give you an answer, and Kevin, chime in if there's anything you want to add. Obviously, the answer is we are working to the contract with the Department of Energy. We really don't have any insights beyond what's been publicly announced. I will remind you, though, that we are the only Western HALU producer of virgin HALU right now. The Department of Energy is set to provide HALU to the OEMs, the advanced reactors. So that is HALU that's needed. Unfortunately, I don't have any information on what's been publicly communicated. No further insights into what other, you know, exercises there could be. But again, like I said, reiterating, CENTRUS is the only one that enriches HALU right now, and it is needed.

Um, I'll I'll give you an answer and Kevin chime in if if there's anything you want to add. Um obviously the answer is is um we are working to to the contract with the Department of energy. We really don't have any insights Beyond what's what's been publicly announced. Um, I will remind you though that we are the only Western Halo producer of Virgin Halo right now.

uh, the department of energy is uh, set to provide Halo to

the uh, the oems the advanced reactors so that

That that is Halo, that's needed.

Um, unfortunately, I don't have any information. What's been publicly communicated? No further insights into

What what other you know exercises there could be. Um, but again, like I said, reiterating, um, Halo centers is the only ones that that enriches Halo right now and it is needed.

Sameer Joshi: Understood. Maybe I can squeeze in one more on the LEU expansion. I think you just mentioned, or Kevin did, the 48 cascade possibility in your current footprint right now. Do we have any estimate on the CapEx required to expand the facility and then deploy the cascades to get to 96? And is there a timeline for that that you are targeting?

Understood, uh, maybe I can squeeze in 1 more, uh, on the on the, the zoo, uh, Leu expansion. Um, I think you, you just mentioned, uh, our Kevin did, uh, the 48 Cascade, uh, uh, possibility in your current, uh, footprint right now. Um, do we have any uh, estimate on the capex?

Required to expand the facility and then deploy the Cascades uh to to get to 96. Uh, and is there a timeline for that, uh, in that you are targeting?

Kevin Harrill: Yeah. So as mentioned earlier, we don't provide information as it relates to our CapEx numbers. What we have publicly announced throughout the past few years is that the first cascade will take 42 months, the second cascade will take six months, and the third in each successive cascade will take two-month increments. We are currently working, especially through our manufacturing readiness initiative, to focus in on the potential of pulling those timelines in. However, as of today, that is what we've established.

The second Cascade will take 6 months.

Kevin Harrill: And with regards to the project and initiative we announced last year, we've been getting ahead of many of the long lead items that we needed to establish, building up our workforce, as well as establishing key critical tooling components that will enable us to maintain and manage our facility at what we expect from a baseline perspective and potentially evaluate what we can do from an acceleration vantage point. So I think all of those are good points of what we're trying to accomplish, but I couldn't get into any more details as it relates to cost or timeline outside of that. But I think that frames it very well. Was that helpful?

And the third in each successive Cascade will take 2, 2 month increments. Um, we are currently working, especially through our manufact, manufacturing Readiness, um, initiative to focus in on the potential of, uh, pulling those timelines in. However, um, as of today, that that is what we've established. Um, and with regards to to to the project and initiative, we announced last year, we've been getting ahead of many, of the long lead items that we needed to establish.

Sameer Joshi: Yes. I mean, so just clarification or maybe just to get some insight, the first cascade of 42 months, is that mainly a capital constraint, or is it mainly technology or resource constraint? How should we look at that? How quickly can we pull it in if you get a billion additional dollars?

Um, building up our Workforce. Um, as well as establishing key critical tooling components that will enable us to um, m m, maintain and manage our facility at what we expect, from a baseline perspective and potentially evaluate what we can do from an acceleration uh vantage point. So I think all of those are are good points um of what we're trying to accomplish. But uh, couldn't get any into any more details as it relates to, to cost or timeline outside of of that. But I think that frames it very well. Was that helpful? Uh yes. I mean, uh, so just clarification uh, or or maybe just to get some insight the first Cascade of 42 months is that mainly uh, Capital constraint, or is it mainly technology or resource constraints? How should we look at that? Uh, how how quickly can we pull it in? If you get the a billion additional dollars,

Amir Vexler: We are manufacturing the centrifuges ourselves, as you know, in Oak Ridge, Tennessee. We have a supply chain that is tapped into providing materials and subcomponents to this. To your question, what paces that 42 months is, obviously, in any manufacturing cycle, there are cycle times that are associated with manufacturing each component and assembly. And that really is what's pacing it. I won't get into any specifics what specifically is pacing it. You know, just a general comment, costs and things of that nature, if we get into a lot of details, it's information that we guard very, very tightly due to competitive nature.

We we are manufacturing the centrifuges ourselves as, as, you know, in, in Oakridge. Tennessee. Uh, we have a supply chain that, that is tapped into providing, um, materials and sub components to this, um, to your question, what paces that 42 months is obviously, is in any manufacturing cycle. There's a cycle times that are associated with manufacturing, each component and assembly and, uh, that really is what's spacing it. Um, I won't get into any specifics. What specifically is spacing is, you know, just the general comment costs and things of that nature if we get into a lot of details. Uh, there there, it's it's information that we guard. Very, very tightly due to competitive nature.

Amir Vexler: However, just so that I can give you an answer, it really has to do with manufacturing and our ability to manufacture within the cycle times and improve those cycle times, as Kevin alluded, in general, just stating that we're exploring opportunities that are out there. So sorry I could not give you a very specific answer, but I believe I kind of answered the general theme of where you were going with this, Amir.

However, uh, just so that I can give you an answer, it really has to do with manufacturing and our ability to.

To, to manufacture within the cycle times and improve those cycle times as Kevin. Alluded in general, is just stating that we're exploring opportunities that are out there.

so, um,

Sorry, I could not give you a very specific answer, but I believe I kind of answered the general theme of where you were going with this mirror.

Sameer Joshi: Yeah. No. Yes. Amir and Kevin, thanks for the color you provided, and I understand the constraints. Thanks a lot for taking my question.

Yeah, no. Yes, I mean Kevin thanks for uh the color. You provided uh uh and I understand the constraints. Uh thanks a lot for taking my questions.

Amir Vexler: Thank you very much.

Operator: Thank you. Ladies and gentlemen, as a reminder, we ask that you each keep to one question and one follow-up. Our next question comes from the line of Eric Stein with Craig Hallam Capital Group. Please proceed with your question.

Thank you. Ladies and gentlemen, as a reminder, we ask that you reach, keep to 1 question and 1 follow-up. Our next question comes from the line of Eric Stein with Craig Howen. Capital group, please proceed with your question.

Eric Stine: Good morning, everyone.

Good morning, everyone.

Amir Vexler: Good morning.

Kevin Harrill: Morning, Eric.

Good morning morning.

Eric Stine: Hey. So most of the relevant questions have been asked, but maybe just high level, just on kind of the overall enrichment backdrop. Obviously, centrifuges is the established, you know, more mature technology, but have seen a number of announcements on gas diffusion, laser enrichment. So, I mean, maybe your thoughts on kind of the role that each has to play, you know, maybe how you expect, well, this is asking about the IDIQ, but you know how you expect things to kind of shake out going forward by technology.

Hey, um it's the most uh the relevant questions have been asked, but maybe just high level just on, you know, kind of the overall enrichment backdrop. Obviously centrifuges is the, you know, the established, uh, you know, more mature technology but have seen a number of announcements on gas diffusion laser enrichment. So I mean, maybe your thoughts on kind of the role that each has to play. Um, you know, maybe how you expect? Uh, well that this is asking about the idea IQ. But, you know, how you expect things to kind of shake out going forward uh by technology.

Amir Vexler: Good question. Very relevant to our times, particularly in trying to understand the competitive landscape. As in past practice, as in policy, we typically do not talk about any company specifically or any technology specifically. A lot of these technologies are classified, and we really don't have access to them as much as others don't have access to our technology. But in very general terms, I think it's important for the investors and the listeners to understand that there's really only three Western enrichers right now that are enriching uranium, and CENTRUS is one of them, and all three of them are centrifuge enrichment technology. It took us decades and billions of dollars to get to where we are. We have successfully completed a, or in the midst of completing a demonstration program with the Department of Energy. That is a monumental task that was achieved over many years.

Uh, good question. Very relevant to our times, uh, particularly in trying to understand the competitive landscape, um, as in fast practice, as in. And in policy, we typically do not talk about any company specifically or any technology specifically a lot of these Technologies are

Classified and we really don't have access to them as much as others don't have access to our technology, but in very general terms I think it's important for the investors and the listeners to understand that.

Amir Vexler: And so as to where do I see other technologies, I know just looking at public information that they're not at that stage. And so we remain to feel confident that the world will have to continue to rely on centrifuge enrichment for the foreseeable future.

As to where do I see other Technologies? Um I I I you know just looking at public information uh that they're not at that stage.

and so, um,

We remain confident that, um,

You know, the the world will have to continue to rely on centrifuge enrichment for the foreseeable future.

Eric Stine: Okay. That's what I was getting at. Thank you very much.

Okay, that's what I was getting at. Thank you very much.

Amir Vexler: Thank you.

Thank you.

Operator: Thank you. Our next question comes from the line of Lawson Winder with Bank of America. Please proceed with your question.

Thank you. Our next question comes from the line of laws and wonder with Bank of America. Please proceed with your question.

Eric Stine: Thank you very much, Operator. Good morning, Amir and Kevin. Thank you so much for the update. Nice quarter. If I could, I'd like to follow back up on some of the commentary and discussion around the contracting. And so, you know, as per your LEU backlog or the contingent LEU sales, the contract book appears to have remained relatively stable since later last year. What we're hearing from other nuclear fuel participants are that utilities today are focused primarily on securing enrichment. And so we've been kind of anticipating a bit of a pickup in enrichment contracting activity. And so given the stability and the expectation that it might have grown, do you see any hesitation from the utilities today on either pricing or contract duration?

Uh, thank you very much. Operator. Good morning, air and Kevin. Thank you so much for the update and nice quarter. Um, if I could, I'd like to uh, follow back up on some of the uh, commentary and discussion around the the Contracting. And so, you know, as per your Leu backlog or the contingent, Leu sales contract, book appears to, to have remained relatively stable, uh, since since later last year, um, what we're hearing from uh, um, other nuclear fuel participants are that utilities today our Focus primarily on securing enrichment? And and so we've been kind of anticipating a bit of a pickup and enrichment Contracting activity. Um and so so given the the stability and and the expectation that that it might have. Uh grown, do you see any hesitation from the utilities today on either pricing or

Eric Stine: And then looking at it from another way, is there any scope to take a different approach to the contingent sales and, for example, structure these as traditional commodity offtake? So rather than just setting them up as contingent sales, getting payment from customers upfront to help fund construction and then, in turn, deliver those SWU in the future?

Contract duration. And then looking at it from another way, is there any scope to take a different approach to the contingent sales? And, and, and for example, structure these as traditional commodity offtake. So, um, rather than just setting them up as contingent sales, um, getting payment from customers up front, to help, fund construction, and then, and then in turn deliver those, uh, those um, swoo in the future.

Amir Vexler: Yeah. I'm just jotting down. It's a two-part question. So let me address the first part of your question around the steady backlog and the momentum around the backlog. I think I cannot speak for the utilities, obviously. They have their own strategy around securing supply chain. Getting LEU is critical to powering reactors. And I mean, they have entire departments of people that are tasked with ensuring that they can get the right deals and that can secure long-term deals as well. It is my strong belief, based on discussions of what we're seeing, that the customers do want to see more competition in the market. These deals take a while to negotiate. I would not conclude anything based on it appearing to be a steady state at a certain point in time. We're in constant discussions.

Yeah, I'm just jotting down. It's a 2-part question. Um,

So, let let me address the first part of your question around the, the, the steady, backlog and, and, and the momentum around the backlog.

um,

The.

I, I think.

I, I cannot speak for the utilities, obviously, they, they they they they have their own strategy around.

Securing supply chain.

Um, getting Leu is is critical to power powering reactors. And I mean they have entire Departments of people that are tasked with ensuring that they can get.

Um, the right deals and that can secure long-term deals as well.

Uh, it is my strong belief based on discussions of what we're seeing that the customers do want to see more competition in the market.

Um,

Amir Vexler: And as I mentioned earlier to the first question, I think it was, this is an imperative for us. And so competition is critical. And as the Stonex, as the Russians sort of exit the market at the end of the decade, I think the utilities understand that in order for the market to continue to thrive, they have to have more competitors in the market. And so to your second question around the contingent nature of the sales and if there's other ways to contract, we're exploring that all the time. We are utilizing every possible option we have to make sure that we answer the call for the customers. At the end of the day, I believe we have a common goal. You know, we are a new entrant, and the customer is looking for more competition.

Um, the these these deals take a while to negotiate, I would not conclude anything based on it. Appearing to be a steady state at a certain point in time. Uh, we're in constant discussions and as I mentioned earlier to the first question, I think it was this is an imperative for us.

and so, um,

competition is critical. And as the as the 10x is, the Russians sort of exit the market. At the end of the decade. I think the utilities understand that in order for, for the market, to continue to thrive, they have to have more competitors in the market.

And so,

To your second question around, uh, the contingent nature of the sales. And if there's other ways to contract, we're exploring that all the time. Um, we are utilizing every possible option. We have to make sure that we answer the call for the customers.

Amir Vexler: So I don't know that I can say beyond that, but you are raising good questions beyond which I cannot provide details. But we're exploring every type of mechanism to make the customers feel comfortable and for us to get what we need to get into the market.

Um, at the end of the day, I believe we have a common goal. You know, we we are a new entrance and the customer is looking for more competition. So, um, I don't know that I can say beyond that, but you are raising good questions Beyond which I cannot provide details. But we we're we're exploring every type of mechanism to to make the customers feel comfortable. And

Eric Stine: Okay. Fantastic. Thank you very much, Amir.

Okay, fantastic. Thank you very much Omar.

Amir Vexler: Thank you.

Thank you.

Operator: Thank you. Our next question comes from the line of Nick Amakuchi with Evercore ISI. Please proceed with your question.

Thank you. Our next question comes from the line of Nick. I'm a coochie with evercore. Isi, please proceed with your question.

Rob Brown: Hey, good morning, guys. How are you?

Hey, good morning, guys. How are you?

Eric Stine: Morning, Nick.

Rob Brown: Just wanted to touch upon one kind of big one that Amir kind of alluded to before. So with the Russian contract kind of culminating over the next couple of years and only three Western enrichers that are currently enriching, I mean, how should we be thinking about and how should the investors kind of be thinking about, obviously, the demand is there from the nuclear side and the nuclear fuel side. How should we be thinking about filling that gap and where that capacity could come online, just given that, you know, it is a 42-month kind of lead time before once we get the allocation that you guys will be really up and running in earnest?

Good morning, Nick. Um, just uh, just

Obviously, the demand is there from the nuclear side and the nuclear fuel side. How, how should we be thinking about filling that Gap and and where that capacity come online? Just given that, um, you know, it is a 42-month kind of lead time before. Um, once we get the allocation that that you guys will be really up and running um in in in earnest.

Amir Vexler: Yeah. Good question, Nick. I think what you're alluding to is, if I paraphrase your question, please tell me if I don't do a good job paraphrasing it, you're saying there may be a time gap in there where there may be insufficient Western capacity to backfill sort of the Russians pulling out of the market. If that is the question, you know, we obviously are working as hard as we can and working with the customers, with the utilities to get everything we can to come online as quickly as possible. And we talked about it many times. LEU is a market that's here, that's now. That's the market that we're pursuing. HALU is we're positioning ourselves for HALU as well. But we all realize that there is going to be an issue in terms of LEU capacity the years that you mentioned.

Yeah. Good question. Like I think what you're alluding to is if I paraphrase your question, please tell me if I don't do a good job paraphrasing. It is you're saying that maybe a Time Gap in there. Where there may be insufficient Western capacity to

Backfill, uh, sort of the Russians pulling out of the market. Um, if that is the question. Um,

you know, we we obviously are working as hard as we can in working with the customers.

Uh, with the utilities to to get everything we can to come online as as quickly as possible. And um, we talked about it, many times Leu is a market that's here. That's now that's the market that that we're pursuing. Halu is we're positioning ourselves for Halu as well. But we all realize that there is going to be an issue in terms of um, Leu capacity, uh, the years that you mentioned.

Amir Vexler: I don't know if I can add anything else to it other than we're working very hard through this public-private partnership that we've identified. I think the Department of Energy understands that there's going to be a gap as well. I think Congress understood that as well. And there's a general realization that there is going to be an issue. And we hope to be a big part of the solution, maybe not for the earlier years, but definitely be part of the solution.

Um, I don't know if I can add anything else to it.

Other than, um,

We're we're working very hard through this public, private partnership that we've identified. I think the, the department of energy understands that there's going to be a gap as well. I think Congress understood that as well.

And there's a general realization that there is going to be an issue and we hope to be a big part of the solution.

but definitely be part of the solution.

Rob Brown: Right. No, that was perfect. Thanks, Amir. And then if I can try and pry on kind of the balance sheet a little bit more and just kind of ask the question, I guess, a little bit differently. So with $833 million in cash on hand, how I guess we're waiting for the actual allocation number, but then presumably that starts the clock. So, and then there's inevitably a lag from the government between actual allocation and then deployment of cash. So I guess how far, how far can that $833 million of cash kind of take you guys, given that you know, you still have the brokerage business to run? How far, sorry, just to clarify, how far it can take us with regards to meeting our obligations and our financial capabilities?

Right.

Um, no, that was, that was perfect. Thanks mayor. Um, and then if, uh, I can I can try and pry on um, on kind of the balance sheet a little bit more, um, and just kind of ask the question, I guess a little bit differently. Um, so with 833 million in cash on hand. Um, how I, I guess we're waiting for the actual allocation number. But then presumably, that starts the clock. So and then there's inevitably a lag with from the government between actual allocation and then deployment of cash. So I guess how far, how what how far can that a 8 833 million of cash? Kind of take you guys? Um, given that, you know, you still have the brokerage business to run?

Eric Stine: Before you really need to, before you're in need of the deployment of the capital. So the difference between the allocation of the DOE funds and the deployment of the DOE funds, you know, given that, you know, if you're able to start, presumably, once you get the allocation, how far, I mean, how much runway do you have before the allocation becomes, you know, necessary? Sorry, the deployment becomes necessary?

Um how how far sorry just to clarify, how far it can take us with regards to meeting our our obligations before the financials before you before, you really need to before you you're you're in need of the the deployment of the capital. So the difference between the allocation of the doe funds and the deployment of the of the doe funds, you know, given that, you know, you if you're able to start, presumably once you get the allocation, how far, I mean, how how how much runway do you have before the allocation becomes, you know, necessary.

All right. Sorry the deployment becomes necessary.

Kevin Harrill: Yeah. It's a difficult question to answer because there's a lot of variables that are still on the table, specifically associated with what come down from the DOE. So it would be hard to speculate on how long it would last us as it relates to capital deployment, which I think is your question. I think it, what I would say is it's a fairly robust number. And if you look at some of our competitors, and I know many of the folks on this call have heard us mention a competitor in Europe who has announced that they're expanding roughly 2.5 million SWU for the equivalent of $2 billion US dollars, roughly. I think it's a little bit less than that.

Yeah, that it's a difficult question to answer because there's a lot of variables that are still on the table, specifically associated with what come down from the doe. Um, so it would, it would be hard to speculate on

how long it, uh, it it would last us as it relates to Capital deployment, which I think I think is, is your question, I think it. Um,

What I would say is it's it's a fairly robust number. Um, and if you look at some of our competitors and I know many of the, the folks on this call have heard us mention, um, a competitor and in Europe, who is announced that they're expanding, um, roughly 2.5 million swooce for the equivalent of 2 billion US dollars.

um,

Kevin Harrill: But I think that gives you a sense of $833, putting us in a positive position as it relates to being able to not only sustain but grow our business once we receive the allocation from the government. Is that helpful? I know I didn't answer it directly, but I think I did it in a way that gives you a sense of what that money can do for us on a go-forward basis when we actually get an announcement from the Department of Energy.

Roughly. Um, I think it's a little bit less than that, but I think that gives you a sense of 833. Um, putting us in a positive position as it relates to being able to, to not only sustain but grow our business. Once we receive the allocation from the government.

Is that helpful? I know, I didn't answer it directly but I, I I think I did it. Uh,

In a way that gives you a sense of what that money can do for us on a go-forward basis when we actually get an announcement from the Department of Energy.

Amir Vexler: We'll say it's close enough for government work, Kevin. So thank you.

Well, say it's close enough for government Work. Kevin, so thank you.

Kevin Harrill: Excellent. Thank you.

Excellent, thank you.

Eric Stine: Thank you, Nick.

Thank you, next.

Operator: Thank you. Our next question comes from the line of Jed Dorsheimer with William Blair. Please proceed with your question.

Thank you. Our next question comes from the line of Jed dorsheimer with William Blair, please proceed with your question.

Amir Vexler: Hi. Thanks for taking my question, and congratulations on a fantastic quarter, guys.

Eric Stine: Thank you, Jed.

Amir Vexler: I guess, yeah, Amir and maybe Kevin too, just sort of a higher-level structural, you know, a lot of the questions have been asked around capital. But I'm wondering, you know, if we look at what the Department of Defense did with MP materials in setting a market structure in terms of pricing of neodymium, it seems like the government understands the Department of Energy understands the challenges with HALU quite well, but it hasn't necessarily trickled over to LEU. So I'm just wondering, do you see that as kind of the pathway forward in terms of government intervention to setting a floor on the market or a structure that's similar? I'm curious your thoughts on that. Interesting question, Jed.

My question in uh congratulations on uh fantastic quarter guys. Um thank you, I guess.

Yeah, just a mere, Maybe.

uh, and maybe Kevin too just

Sort of a higher.

Structural. You know, a lot of the questions have been asked around Capital, um, but I'm wondering, you know, if we look at the what the Department of Defense did with MP materials in setting a market structure in terms of pricing of neodymium, it seems like the government understand that, the department of energy understands the uh, challenges with uh, um, Halu quite well. Um, but it hasn't necessarily trickled over to, um, Leu. Uh, so I'm just wondering. Do you see? That is kind of the pathway forward in terms of government intervention to, uh, setting a floor on the market or, um, or a structure that's similar. I'm curious your thoughts on that.

Amir Vexler: I do not really wish to go into speculating too far as to how and in what matter the Department of Energy or the government in general will impact the market. I honestly have no insight into this. It would be interesting to watch how things unfold with the awards. And you know, I'll remind you that they have substantial awards to make, not only LEU, but also HALU. There's national security, and there's deconversion. So I think you're asking a very relevant question is whether this size of awards will sort of be enough to sway and influence the market. Honestly, I do not know. It will depend how the agreements, contracts will be structured, and how they will flow down to the award recipients. But nonetheless, a good question to keep in mind and keep an eye on.

Interesting question Jed. Um, um, without I, I do not really wish to go into speculating too far as to how and, and What mattered, the the department of energy or the government in general, will impact the market.

I honestly have no insight into this, it would be interesting to watch how things unfold with, with, with the awards. And, you know, I, I'll remind you that they have substantial Awards to make not only Lou but also Halo there is National Security and there's the conversion. So um, I think you're asking a very relevant question, is whether this size of awards will sort of be enough to sway and influence a market?

Honestly, I do not know it will depend how the agreements contracts will be structured and how they will slow down to to the award recipients.

but nonetheless a, a good question, to keep in mind and keep and keep an eye on

Eric Stine: Great. Thanks. I'll jump back in the queue. And nice to see the quarters. Pretty straightforward.

Great thanks. I'll jump back in the queue um and uh nice to see the uh the quarters pretty straight forward.

Amir Vexler: Thank you, Jed.

Thank you, Jed.

Operator: Thank you. Our next question comes from the line of Stephen Jengaro with Stifel. Please proceed with your question.

Thank you. Our next question comes from the line of Steven jingar with steveo please. Proceed with your question.

Sameer Joshi: Thanks. Good morning, everybody. Just one for me. Outside of sort of the expectations on the centrifuge side over time, are there any other areas of the supply chain that interest you over time?

Uh, thanks. Good morning everybody.

Um just just 1, 1 1 for me. Um, I outside of sort of the expectations on the century side. Over time, are there any other areas of the supply chain that interests you over time?

Hm.

Amir Vexler: I guess I'm trying to understand the question, Stephen, a little more holistically. Obviously, the supply chain.

I guess.

You're I'm I'm trying to understand the question. Stephen, A Little More holistically. Um,

Sameer Joshi: Yeah. So when we think about the life, you know, from mining through fuel fab, are there any other pieces outside of what you're currently focused on on the centrifuge technology side that you think would be additive or strategically important for CENTRUS to be involved in?

Obviously this is why. Yes. So when we think about the life, the life, you know, from from mining through through fuel Fab are there is are there any other pieces outside of of what you're currently focused on on the centrifuge technology side that you think would be additive or strategically important for centers to be involved in? Oh,

Amir Vexler: yes. Now I understand your question. So our focus right now, and we're very laser-focused on reindustrializing and commercializing our centrifuge technology. And as you know, where it kickstarted our readiness, as we mentioned numerous times. Could vertical integration, using my words, be helpful? You know, I would not want to speculate or say anything at this point. I can see just in general terms, not speaking for CENTRUS, but I mean, there's obviously advantages in a certain level of vertical integration and the efficiency that it brings. So I'm not really revealing or announcing anything here, but I do want to say that we're always evaluating opportunities. We're always evaluating possibilities on how to become more efficient, more cost-efficient, more competitive. But our goal and primary mission right now is the enrichment. But nonetheless, good question.

Yes, not now I understand your question. So um,

The our Focus right now and we're very laser focused on reindexing in commercializing our Center Fugue technology.

and um, as as you know, where the kick started our Readiness, as we mentioned, numerous times,

Could.

Could could vertical integration using my words, be helpful. I, you know, I would not want to speculate or or say anything at this point.

um,

I I can see just in general terms, not not speaking for for centuries, but I mean there's obviously advantages in in in uh certain level of vertical integration and the efficiency that it brings

So, I'm I'm not really revealing or announcing anything here, but I, I do want to say that, um, we always evaluating opportunities, we're always evaluating possibilities on how become more efficient, more cost, efficient more competitive.

Uh, but our goal and and primary mission right now is is the enrichment. But nonetheless, good, good question.

Sameer Joshi: Okay. Thank you, Amir.

Okay, thank you. Amir

Amir Vexler: Thanks.

Thanks.

Operator: Thank you. Our next question comes from the line of Jeff Grant with Northland Capital Markets. Please proceed with your question.

Thank you. Our next question comes from the line of Jeff Grant with Northland Capital markets, please proceed with your question.

Jeff Grant: Good morning. I wanted to go back to the phase three HALU contract that you guys are currently underway with. Given that the volume targets, I believe, are fairly consistent with levels that you guys have already kind of proven out or demonstrated, what would you say are kind of the main goals or objectives of phase three relative to what you've demonstrated in phase two? Thanks.

Good morning.

want to go back to the, uh,

Frustrated, what would you say are kind of the main goals or objectives of Phase 3 relative to what you've demonstrated in Phase 2? Thanks.

Amir Vexler: Okay. So I'm assuming you are talking about the HALU contract. The goals are to continue producing at our rates and fulfilling the stated deliveries and the production rates that we've committed to. And we're well positioned to do that.

Okay, so, um, assuming you are talking about the, uh, the Halo contract.

um, the goals are

To continue producing at our rates and fulfilling the uh, the the stated deliveries. And the production rates that we that we that we've committed to and we're well positioned to do that.

Jeff Grant: Okay. Just to peel that onion back a little bit more, would you say it's, I guess, the objective is to continue to demonstrate the, I guess, consistency or longevity to produce at these levels, or is there anything that's particularly, I guess, different in any meaningful way relative to the operations of the past year or so?

Okay. Just to peel that onion back a little bit more. Would you say it's um I I guess the objective is to continue to demonstrate the I guess consistency or longevity to produce it, these levels or is there anything that's particularly, I guess?

Different um in any meaningful way relative to the the operations of the past you know year or so.

Amir Vexler: I see what you mean. So just from my perspective, it's, you know, it is termed as a demo program, and we're very thankful and grateful for the opportunity to be engaged in a long-term demonstration. As you know, we have been already demonstrating and continuously enriching for over a year and a half now. And as we stated publicly before, the performance of our machines has been meeting our expectations as designed. It is a bit awkward because the material that is used during this demo program is actually useful and is going to be used for useful purposes. So it's sort of like a dual-use program. We will continue learning as much as we can out of that demonstration. And as I mentioned earlier, the equipment and the centrifuges, everything runs as designed and as we expect them to, within the parameters we expect them to.

I see what you mean. So, um, just from my perspective, it's.

You know, it is termed as a demo program, and we're very thankful and grateful for the opportunity to be engaged in a long-term demonstration. As you know, we have been already demonstrating and continuously enriching for over a year and a half now. As we stated publicly before, um,

The performance of our machines have been.

Uh, meeting our expectations as designed.

Um, it it is a bit awkward because the material that is used during this demo program, is actually useful. And and it's going to be used for useful purposes, so it's sort of like a, a, a dual use program.

Um,

We, we will continue learning as much as we can out of that demonstration. And as I mentioned earlier, um,

the equipment and centrifuges everything runs as designed and as we expect them to within the parameters, we inspect them too.

Amir Vexler: So we will continue the production.

So we will continue the production.

Jeff Grant: Understood. Thank you. Appreciate the time.

Understood, thank you for your time.

Operator: Thank you. Ladies and gentlemen, that concludes our question and answer session. I'll turn the floor back to Mr. Nagarajan for any final comments.

Thank you.

Ladies and gentlemen, that concludes our question and answer session. I'll turn the floor back to Mr. Narc nagarajan for any final comments,

Neal Nagarajan: Thank you, Operator. This will conclude our investor call for the second quarter of 2025. As always, I want to extend a thank you to our listeners online and our analysts who called in. We look forward to speaking with you again next quarter.

Thank you operator, this will conclude our investor call for the second quarter of 2025. As always, I want to extend a thank you to our listeners online and our analysts who called in

We look forward to speaking with you again, next quarter.

Operator: Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.

Thank you, this concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.