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Operator: Thank you for standing by. This is the conference operator. Welcome to The Cameco Corporation First Quarter 2025 Results Conference Call. As a reminder, all participants are in a listen-only mode and the conference is being recorded. [Operator Instructions]. I would now like to turn the conference over to Cory Kos, Vice President, Investor Relations. Please go ahead.

Cory Kos: Thank you, operator, and good morning, everyone. Welcome to Cameco’s first quarter conference call. I would like to acknowledge that we are speaking from our corporate office which is on Treaty 6 Territory, the traditional territory of the Cree People and the homeland of the Metis. With us today are Tim Gitzel, President and CEO; Grant Isaac, Executive VP and CFO; Heidi Shockey, Senior VP and Deputy CFO; and Rachelle Girard, Senior VP and Chief Corporate Officer. I will hand it over to Tim momentarily to briefly discuss the continued positive momentum across the nuclear energy market and our strong Q1 performance alongside a solid financial position. After, we will open it up to your questions. Today’s call will be approximately one hour concluding at 9:00am Eastern Time.

As always, our goal is to be open and transparent with our communication. However, we do want to respect everyone’s time and conclude the call on time. Therefore, should we not get to your questions during this call or if you would like to get into detailed financial modeling questions about our quarterly results, we would be happy to respond to any follow up inquiries. There are a few ways to contact us with additional questions. You can reach out to the contacts provided in our news release. You can submit a question through the Send Us a Message link in the Invest section of our website or you can use the Ask a Question form at the bottom of the webcast screen and we’ll be happy to follow up after this call. If you join the conference call through our website event page, there are slides available which will be displayed during the call.

In addition, for your reference, our quarterly investor handout is available for download in a PDF on our website at cameco.com. Today’s conference call is open to all members of the investment community, including the media. During the Q&A session, please limit yourself to two questions and then return to the queue. Note that this conference call will include forward-looking information which is based on a number of assumptions and actual results could differ materially. You should not place undue reliance on forward-looking statements. You should not place undue reliance on forward-looking statements. Actual results may differ materially from these forward-looking statements and we do not undertake any obligation to update any forward-looking statements we make today except as required by law.

As required by securities laws, we also have to make you aware that during today’s discussion, the company will make a number of references to non IFRS and other financial measures. Cameco believes these measures provide investors with useful perspective on underlying business trends and a full reconciliation of non IFRS financial measures is available at cameco.com/invest. Please refer to our most recent annual information form in MD&A for more information about the factors that could cause different results and the assumptions we have made. I will now turn it over to our President and CEO, Tim Gitzel. Tim?

Tim Gitzel: Well, thank you Cory and hello everyone. We appreciate you joining us on our call today. I hope everyone is doing well and enjoying spring or autumn, depending on where you’re listening from. Here in Canada, the snow is gone, it’s spring and we just wrapped up a federal election earlier this week. I’d like to personally congratulate Prime Minister Mark Carney and the Liberal Party. We’re excited to begin working with the newly elected Canadian government and look forward to Prime Minister Carney’s strong leadership in navigating the current uncertain environment of global tariffs, evolving fiscal policy and complex geopolitics. Our hope is that we can work together to advance the development of the nuclear fuel cycle and expand the use of nuclear energy in Canada and abroad.

As a country, Canada is blessed with a rich uranium resource base that makes this country a key player in the global nuclear fuel supply chain. But like Cameco, when it comes to nuclear energy, Canada is much more than just mining. Beyond our resources we have a long, deep history in the nuclear sector. So when combined with our advanced technology and generational nuclear expertise, a supportive and collaborative government will be key in helping put Canada on the map as a nuclear industry leader in support of global energy, national and climate security objectives. As we get started, I first want to encourage stakeholders to focus on our long-term strategy and the long-term industry outlook discussions in our disclosure beyond the near-term geopolitical and trade policy distractions.

That said, there is no doubt that those distractions have created new and unexpected risks that must be carefully monitored and diligently managed. It is extremely difficult to operate the world’s nuclear fleet if the movement of uranium fuel is restricted because those who need it most, tend to have the least. At the outset of the quarter in January, the U.S. threatened to impose a 10% tariff on Canadian energy products. But amid the flurry of tariff changes, retaliatory tariffs and ongoing negotiations, energy products that are compliant with the Canada, United States, Mexico Free Trade Agreement are currently exempt. That means, for the time being, there are no tariffs on our natural uranium, UF6 and enriched uranium products, preserving the flow of nuclear fuel imports into the U.S. Market.

But regardless of the current exemption, we know that a lot can change overnight. For example, In April, the U.S. launched a new Section 232 investigation to address the risks of reliance on foreign sources of processed critical minerals. Notably, the executive order outlined uranium in the definition of critical minerals, directing agencies to assess the national security risks stemming from U.S. dependence on foreign imports. We went through a similar Section 232 investigation covering steel, aluminum and uranium under the previous Trump administration, and at that time uranium was spared. However, we take nothing for granted. That was a different time and a different trade environment. Following that first investigation in 2019, we proactively took steps to minimize potential future impacts, such as adjusting and clarifying our contract terms and positioning material well ahead of expected deliveries.

Those pre-emptive actions helped us prepare for the more recent threat of tariffs on Canadian nuclear fuel products, and we will continue to adapt accordingly and mitigate such risks in the future. I’m sure there will be more to come this year as negotiations continue and policies evolve, but two things are certain. There’s no substitute for uranium in a nuclear fuel bundle, and there’s no elasticity to the demand for nuclear fuel. You need it to run your reactors and power your economy regardless of tariffs or higher costs. Looking at the future picture for nuclear beyond the near-term noise, it continues to be more positive than we’ve ever seen. You’ve heard us consistently express a positive long-term demand outlook quarter-after-quarter for a few years now, so I won’t spend much time reiterating the strong industry tailwinds.

I would say it’s now a regular occurrence to see news and announcements of significant positive industry developments, with nations reaffirming commitments to nuclear, extending reactor lives and saving those that were to be shuttered, and planning new reactors. We’ve recently seen the world bank announce plans to lift its decades old ban on funding nuclear projects, and we’ve had more announcements of reactor operating licenses being extended in the U.S. pushing some reactor lives to 80 years. This week, 10 new builds were approved in China, marking the fourth consecutive year that China has approved at least 10 new reactors. Just yesterday, Poland signed an agreement with Westinghouse Bechtel and Polish utility PEJ launching the next phase of preparatory and engineering work for its three-unit AP1000 project, the first commercial nuclear plant in the country.

Those are just a few of the headlines that support our unwavering view that full cycle demand is durable and stronger than ever. The world remains focused on energy security, national security, climate security and sustainability, all in the context of growing clean energy demand. But as we keep emphasizing, the risks to supply are far greater than the risks to demand. Despite the long-term uranium price remaining near its highest level in over a decade, the industry is still not seeing the level of long-term utility contracting necessary to support both brownfield expansion plans and the significant investment in new projects that will be required to meet growing future demand. 787 To meet the total fuel requirements of the world reactors between now and 2045, the world’s utilities still have a lot of uranium to buy.

In fact, 70% of their needs through 2045 remain uncovered. That’s about 3.2 billion pounds that remains to be contracted and for roughly one third, or about 1.3 billion pounds, the source of annual primary production is not yet known. With each passing quarter that long-term contracting remains below replacement rate, the uncovered requirements line continues to steepen. Long-term contracts must be in place to support mining economics and underpin ongoing investments in supply. But with the continued uncertainty driven by global trade policies and unclear market access, fuel buyers have remained focused on adapting procurement plans under the threat of tariffs and securing downstream conversion and enrichment services before buying the natural uranium.

Looking ahead, we believe a move upstream to focus on security of uranium supply is inevitable and unavoidable. Shifting to briefly highlight Cameco’s first quarter. As always, normal quarterly variability in customer deliveries impacted our results. However, under our strategy, which remains consistent and centered on operational marketing and financial discipline, we delivered strong results. We saw notable improvements across all key financial metrics. With revenue up 24%, gross profit up 44%, adjusted net earnings up 52% and adjusted EBITDA up 5%. And with our first quarter average realized price increasing year-over-year at a time when the average uranium spot price fell 30%, it remains clear that value creation in our industry requires a long-term contracting strategy and we are clearly well positioned.

As expected, our Westinghouse segment reported a net loss in the first quarter of 2025. Due to the normal quarterly variations in customer requirements and the ongoing amortization of the intangible assets related to the acquisition. We continue to expect an annual net loss of $20 million to $70 million for Westinghouse in 2025. We focus on adjusted EBITDA as a key performance measure for Westinghouse as it adjusts for non-operational or non-cash items like amortization costs. In the first quarter this year we saw a 19% improvement in Westinghouse’s adjusted EBITDA compared to the first quarter of last year. Beyond Q1, Westinghouse’s first half results are expected to be weaker with stronger performance and higher cash flows expected in the fourth quarter.

For the year, our share of adjusted EBITDA is still expected to be between $355 million and $405 million. And needless to say, with all of the growth opportunities that have materialized post-acquisition, we continue to be pleased with the performance and excited about the potential of our investment. Our operational performance across all segments continues to improve and our outlook for the year remains strong and consistent with our expectations. In our uranium segment, our share of Production from our two Northern Saskatchewan operations was six million pounds in the first quarter of 2025, slightly higher than the 5.8 million pounds in Q1 last year. We continue to expect 18 million pounds of production on a 100% basis at each of our MacArthur River, Key Lake and our Cigar Lake operations.

We also continue to evaluate the optimal mix of production, inventory and purchases to retain the flexibility to deliver long-term value. The first source of supply is our tier one primary production which always has a home under a long-term contract before it is pulled out of the ground. The next source is our purchase material and our inventory, including our share of production purchased from JV Inkai. Following the unexpected suspension of production for most of January, JV Inkai updated its plans to adjust for the suspension and is targeting 8.3 million pounds of uranium for 2025 of which our purchase allocation is 3.7 million pounds. The team is still working on a delivery schedule based on the new production plan, but we do not expect to receive any deliveries from JV Inkai until at least the second half of 2025.

And with ongoing acid and other supply chain challenges, the updated 2025 production target is certainly not without risk. In the fuel services segment, production also started the year strong, up 5% over the first quarter of last year. Our annual production expectation for fuel services remains between 13 million and 14 million kg of combined products for the year. In the uranium market, long-term contracting activity is expected to continue to gain momentum. The long-term price increased from $68 per pound in January 2024, holding now around $80 per pound for several quarters. Our marketing team continues to be very busy with a large and growing pipeline of business under discussion that is expected to further grow our long-term portfolio.

As contracting picks up, we continue to be selective in committing our uranium inventory and UF6 conversion capacity in order to maintain a contract book that preserves exposure to the rising prices while maintaining downside protection. Maintaining financial balance and balanced liquidity to execute on our strategy remains a priority. Our balance sheet is strong and we continue to expect strong cash flow generation in 2025. Thanks to our risk managed financial discipline and strong cash position in January 2025 we made the final repayment of $200 million to fully repay the $600 million term loan we used to finance the acquisition of Westinghouse. As previously disclosed, we received our first cash distribution from Westinghouse, our share being $49 million of the $100 million distribution paid in February.

And in April, following the end of the first quarter, we received a cash dividend of $87 million net of withholdings from JV Inkai based on its 2024 financial performance. So, from a financial perspective we continue to be in excellent shape. We’ve remained diligent in managing the capital, resources and tools required to deliver on our strategy, maintaining a strong balance sheet guided by our investment grade rating. Amid the intensifying geopolitical challenges and complex international trade relationships, it’s more important than ever to procure nuclear fuel from responsible, reliable, experienced and sustainable suppliers like Cameco. Fuel that supports a future energy supply that is secure, reliable and carbon free. We believe Cameco’s premier tier one fuel cycle assets, complemented by our investments across the reactor life cycle, puts us in a unique position to power a secure energy future.

So I thank everyone on the line and on the webcast for your interest today and we will now take your questions.

Operator: We will now begin the question-and-answer session. [Operator Instructions] The first question today comes from Orest Wowkodaw with Scotiabank. Please go ahead.

Orest Wowkodaw: Hi, good morning. Obviously, the balance sheet’s in great shape here with paying down the remaining term loan debt on the Westinghouse acquisition. I’m just wondering, given the forecast or the outlook moving forward in terms of solid free cash flow and no real material uses of cash that we’re aware of, can you really talk about what the priorities are for capital allocation moving forward here? And I’m wondering whether increasing capital returns or returns to shareholders either be dividends or could we see a buyback coming from Cameco? It really seems like you’re in a strong financial position moving forward.

Tim Gitzel: Hi Orest, thanks for the question. We’ve got the CFO and deputy CFO here. So Grant, why don’t you start?

Grant Isaac: Yeah, happy to do that. Maybe a bit of a tag team if necessary. Hi Orest, thanks and thanks to everybody for joining. We’re always excited to talk about Cameco and its really critical role in this nuclear fuel cycle and reactor cycle. There is no doubt that our strategy is playing out. We’ve simply delivered on what we said we would deliver on. And you’re seeing that in the financial results and you’re seeing that in the outlook. But I would remind folks that we remain in supply discipline as Cameco for a very specific reason and that is we have yet to see the uranium segment hit replacement rate or above replacement rate contracting. So while in supply discipline, that always reminds us that we must remain financially conservative because you have to design a strategy that’s got the right mining plan, the right milling plan, the right marketing plan, and it has to be backed up by a balance sheet that allows you the patience, the patience that utilities can show and has to be matched on the supply side.

So, with that backdrop, we remain very conservative in our focus. We are seeing strong cash flow, strong earnings build. But while we’re in supply discipline, we always want to make sure we can self-manage the risk of say, a prolonged delay in the contracting cycle so that there are no awkward lurches to the capital markets because we mistimed it, for example, that would be a, an inappropriate thing for us to do. As we look ahead, what are the things that we might spend capital on? Well, no doubt that our position in a recovering nuclear fuel cycle is an important one. We have opportunities through our Cameco asset base on the uranium side, we have opportunities on the conversion side, obviously opportunities in enrichment. And then of course through Westinghouse, we have opportunities for further investments.

But we have to, we have to be very careful with making those decisions because there is some uncertainty that we’re trying to navigate. I would just point to, for example, making sure we have clarity and certainty over the role of Russia going forward in the nuclear fuel cycle, because we’ve all seen what’s happened in the past. So we have not abandoned our conservative financial discipline yet. As we go forward, we will look for appropriate risk adjusted growth opportunities. After that we would then be looking at maybe it’s appropriate to return capital to our owners. Maybe that’s appropriate through enhancing our dividend growth strategy, which we have out there right now. Maybe it’s appropriate through shrinking the outstanding denominator of our shares through a share buyback.

But I would just say that the strategy is paying off, but it’s paying off in a market that hasn’t yet fully come with its demand. We remain in supply discipline and that’s what’s driving our conservativism. We will obviously keep this group up to date on any plans on capital allocation, but I just wanted to provide that strategic backdrop.

Tim Gitzel: And Orest. It’s certainly something our board has at the top of their agenda every meeting as well. So we’re looking at it closely.

Orest Wowkodaw: Thank you. And as a follow up, if I could, can you speak to what the implications are for Westinghouse with respect to the recent IP legal settlement with Korea? What could that mean to that five-year outlook for Westinghouse if there are material builds outside of Korea that is done by that organization?

Grant Isaac: Yes. Thank you, Orest. At the time of acquiring Westinghouse, there was an outstanding intellectual property dispute between the Koreans and between Westinghouse over the use of what is essentially Westinghouse technology in the Korean reactors. There was a very important government to government agreement that was signed between the U.S. and the Korean government. And following that was a commercial agreement between Westinghouse and the Koreans. There’s a confidentiality agreement wrapped around that for the moment. But let me just step back in effect — and say what effectively means. It means that Westinghouse and the Koreans have gone from potentially being competitors in markets for gigawatt scale, new build to be important collaborators, reflecting, in fact, what is the shared contribution each makes to a new build program.

And so as markets where Westinghouse may not have been competitive, for example, where utilities or states were looking for a fixed price turnkey solution, which, of course, everybody knows, you’ve heard us say Westinghouse is not in the market offering fixed price on a turnkey reactor, that would — those were markets that the Koreans were very competitive in. But now instead of being excluded from those markets, Westinghouse has an opportunity to participate in the scope of the those newbuilds. So, if you want to think about it from an energy systems point of view, remember, that’s a segment that we valued at zero at the time of acquisition. For Westinghouse and AP1000, we’ve since seen positive announcements in Poland, Bulgaria, Slovenia, Ukraine, and now there are markets where Westinghouse was not successful like the Czech Republic, Czechia where Westinghouse will now participate.

So it actually just grows the scope of the Energy Systems business. It’s very exciting. But ultimately, there are some steps that we have to still go through with the agreement before we can say more. But when we can, we’re going to be very excited. It’s an agreement definitely to the mutual benefit of Westinghouse and the Koreans.

Orest Wowkodaw: And just finally, how quickly could it impact Westinghouse’s performance?

Grant Isaac: The trigger, if you will, for impacting Westinghouse performance is when the announcement of a new build or a vendor selection in the new build gets to the point where a final investment decision is made by the country that’s considering it. And as we’ve been talking about from the Poland example, once a reactor is chosen, you still go through a series of front-end engineering and design work, not to design the reactor, but to engineer the reactor in a novel location, that’s all part of leading towards that final investment decision, which usually coincides with an EPC contract. So if you look at the markets where the Koreans have been successful in bidding their reactor offering, Czechia is a market that is well ahead with respect to going down that process.

It is a nuclear market. They’re very familiar with operating building nuclear reactors. So really, the trigger becomes when a final investment decision is made and an EPC contract is signed. Now those are incredibly hard to predict, and I’m not going to try to predict them. But that process, let me just say, is well underway in the Czech Republic.

Orest Wowkodaw: Thank you. Thanks, Grant. Thanks, Tim.

Operator: The next question comes from Ralph Profiti with Stifel. Please go ahead.

Ralph Profiti: Thanks, operator. And good morning, everyone. Tim, I wanted to come back to your comments about fuel buyer procurement emphasis upstream versus downstream. And from your comments, it doesn’t seem like we are in a phase of normal buying prioritization. Just wondering what the industry markers you’re looking for that will mark more of a transition? How far are we away from that type of market? And what are the indications that we can look to see that changing?

Tim Gitzel: Yes, Ralph, thanks for the question. I think you also heard me say that between now and 2045, I think there’s over GBP 3 billion on procured at GBP 3.2 billion and over a billion of those not sure where they’re coming from, yet what source is going to provide those. So we’re not seeing the panic yet. You’ve heard Grant probably many, many times, say, fuel buyers start at the back end and they worry about their fuel bundles and then work backwards from there. Where is your enrichment coming from, you see an enormous pressure on the enrichment space. in the last couple of years, especially since the Russian move into Ukraine conversion, same thing, enormous pressure. There is no reason why that’s not going to come to the uranium space.

It just hasn’t got there yet. And so we’re being patient. We were saying, I think, to our board yesterday that you can run, but you can’t hide. I mean people need uranium to make this whole thing work. And so you can defer and wait and hope for better times, but they have to come to the market, and we have not yet seen replacement rate contracting really in the last 10 years. And so there’s a deficit out there. That’s going to have to be filled. And as Grant said in his comments, we’re patient. We make sure our production is patient, our marketing is patient. We have a very strong financial position that we’re ready and we can wait it out, but it’s coming. We’re sure of that.

Grant Isaac: Yes, Tim, if I could, I’ll jump in. And Ralph, there’s always a risk trying to call a turning point, but let me go ahead and try to do it anyway. At the recent WFC conference in Montreal our Vice President of Global Marketing, Lisa Akin, was on a panel, and she made a couple of observations that I think are really important. And if I can point you to a slide and point everybody to a slide, it’s Slide 6, in Tim’s comments — or Slide 16 in the investor handout for Q1 of 2025. And what I — what it feels like is starting to happen in the long-term contracting market for uranium, it is the challenge that’s depicted in that slide is really starting to impress upon fuel buyers. So if you look at the left-hand panel, the shaded area is good.

Just think of that as if you see a shaded area, that’s good. That’s the wedge of uncovered requirements. That’s the wedge of demand that Tim was referring to. It now goes out to 2045 and it now equals 3.2 billion pounds of uranium that needs to be procured over the next 20 years. That 70% of the requirements over the next 20 years that have not yet been bought and you look to the panel on the right-hand side and you say, well, how worried should we be, you see after a decade of underinvestment due to low prices, and a decade of harvesting inventories and secondary supplies, you see a primary supply stack that’s falling over the same period. You see a secondary supply stack that’s falling. You layer in some known proposed production, the kind of stuff that’s been hyped for many, many years.

Well, let’s assume it’s going to come into the market. And even under the base case demand, you see that red wedge there of 1.3 billion pounds of uranium, we’re not sure where it’s coming from. And I would just echo the comments that Lisa made on the panel until we see stronger demand in the market until we see utilities calling for that, the investments simply won’t be made to fill that red wedge that feels really good to an incumbent uranium producer who has yet to run at full capacity, who hasn’t even got its Tier 1 assets at full capacity, let alone the contemplating restarting our Tier 2s. This is why we’re patient. This is why we’re still in supply discipline because this is an incredibly strong setup.

Ralph Profiti: Understood. Well said. Thanks very much. And if I could just ask a follow-up on your recent meetings in — with the Kazakhs and we’ve got some production visibility now for 2025 at Inkai. Just wondering what your meetings over the last several weeks and months since the production shutdown have yielded in terms of commitment going forward? Your feeling on being able to meet those long-term production targets, your comfort around the long-term viability of Chemicals Kazakhstan business?

Tim Gitzel: Yes. Ralph, it’s Tim. We have met with them several times here in Canada, PDAC. And in other places, we’ve had teams go over. I’ll be heading over there in a couple of weeks for the Foreign Investors’ Council, meeting with the President. I’d say things are back on track there after those 23 days in January that we weren’t sure what exactly was happening. They got the licensing back in place. restarted operations. We’re targeting 8.3 million pounds now of production for the year, 3.7 or share. I think we’ve got just under a million pounds sitting there that will be coming over sometime this year as well. And so I’d say our relations are back on track, we obviously have great respect for the Kazatomprom team, Mr. Yussupov, who runs the place is a good leader and a good friend of ours.

And so I’d say — I mean there’s always the risk. The acid risk hasn’t gone away. Supply chain risk hasn’t gone away. But our relations with them have stabilized, and we’re on a good track.

Ralph Profiti: And from a sulfuric acid availability and procurement, what does that outlook look like?

Tim Gitzel: I’m going to ask Cory Kos, who’s our Kazakh expert, the lateston sulfuric acid.

Cory Kos: Ralph. Yes, we haven’t seen any indication that an agreement has been signed to actually go ahead and build a plant, but they’ve remained on that line that the — I think 2027 is when they expect to have the plant in place. But again, haven’t seen construction start and haven’t seen agreements signed. So no solution is in place yet.

Ralph Profiti: Okay, thanks. Important answers.

Operator: The next question comes from Alexander Pearce with BMO Capital Markets. Please go ahead.

Alexander Pearce: Good morning, all. I have a follow-up question on Inkai. So Tim, you mentioned that you weren’t expecting to get deliveries until, I think you said at least H2 this year. Is it fair to say that you think the deliveries are more likely to be weighted in the back end of the year, i.e., kind of Q4? And could you see a situation where actually there’s any more delay to those deliveries?

Tim Gitzel: Yes, I don’t have any specific information. We know it’s probably a second half of the year is what we said. And so, Alex, I really don’t have any more specific timing on that yet. And as soon as we do, we’ll let everybody know, but we’re confident it will come in the second part of the year.

Alexander Pearce: Okay. Thanks, Tim. And then maybe I can ask just a question on McArthur River. So can I just ask where you stand with some of the studies you’re doing there for potential production upside? I know there’s no mention of it in the MD&A this time. Are you still looking at the potential upside towards the line capacity levels? Thanks.

Tim Gitzel: Yes. Thanks, Alex. No decision to expand there. We’re in supply discipline, as Grant has said many, many times, we’ve said we’re not moving until our contract book calls for it. And so no decision to produce anything more than 18 million pounds at McArthur River, Key Lake. I think Key Lake is down at the moment. We’re on a shutdown. Stan stood the mine down — the mill down to do our annual maintenance on it this month. So you’ll see a little bit less production there. But we — no, no change, 18 million at McArthur. We continue to evaluate how to reduce risk and debottleneck the site in the event that at some point, we want to increase our production. We could go to 25 million pounds. I think everyone know that. Those are the best 7 million extra pounds probably on the planet. But today, no decision to make any moves on that.

Alexander Pearce: Okay. Thanks, Tim.

Operator: The next question comes from Lawson Winder with Bank of America. Please go ahead.

Lawson Winder: Thank you very much, operator. And good morning, Tim and Grant. Thank you very much for the update today. There was an interesting comment in your MD&A, just noting that prices from fixed price contracts had increased. Can you provide any color in terms of the direction of travel relative to the current $80 per pound long-term price indicator? And would you describe the situation as one where the balance sheet shifting more towards fixed-price contracting?

Grant Isaac: Yes. There’s a lot to unpack in that question, Lawson. Let me just back and talk about it from a market point of view. When you look at the interest in long-term contracting there would be some utilities that do have a preference for market-related there would be some utilities that have a strong preference for fixed. And then that preference tends to shift with where you are in the cycle. For those utilities that are looking at our Slide 6 that shows there’s 1.3 billion pounds of uranium. We don’t know where it’s coming from against the $3.2 billion that needs to be bought. That’s a pretty shocking risk that’s been transferred to fuel buyers we will see an interest in trying to fix the price because that would be driven by a fuel buyer who understands prices probably have to go up and have to go up significantly in order to incent supply to come to the market.

Market-related because suppose we’re in a market where they’ve agreed to fix the price, but the price happens to be below. They just don’t want to take that kind of risk. You don’t want to be taken out behind the woodshed for trying to call a price around volatility. So really, it is specific to where you are in the cycle and then specific to the value at risk metrics of the utilities themselves. For Cameco, we said in Q4, and we’ll continue to say today we just remain disciplined in this kind of market. We want market-related exposure. That is a requirement for us if we’re going to commit long-term pounds. And we want market-related exposure at floors and ceilings that reflect the structural gap ahead, not the softening of the spot market that we saw over the first quarter of this year.

We don’t believe that, that has anything to do with what the appropriate is under a long-term contract that starts delivery a couple of years out and then delivers into this window of the structural deficit. So we continue to be very disciplined and we want market related and we want market-related at escalated floors and ceilings that work for us. And for those utilities that are aligned with the need to secure those pounds, we’re still able to have productive conversations for those utilities that want to drag those floors and ceilings down because of the current — because of the spot softness that they saw in the first quarter, I would note that we’ve seen some recent strengthening the bid and ask is just too big for us to have a fruitful conversation.

So we are — again, I’m going to use the term turning point. It feels like there is a growing awareness that it is time to start contracting. We’re starting to see some momentum around some RFPs and momentum around on-market RFPs, is always joined with increased momentum off market directly on a bilateral basis.

Lawson Winder: All right. That’s very helpful commentary. I think as a follow-up; I’d kind of like to get your sense of the transportation and logistics challenges that the industry might be facing today. And it was actually something that came up at WNFC, quite a bit, and it hasn’t been a focus at other more recent conferences. So things that were coming up were impacts from — leftover impact from the pandemic and Panama Canal constraints, reshuffling of Ocean and Alliances. I mean, there’s a lot — and then there’s the USTR Section 301. What are your concerns about potential transportation bottlenecks? And are you seeing any in your supply chains?

Grant Isaac: Lawson, yourself and others who have been dialing in and listening to us for a long time, know that we have been warning about falling asleep on uranium for years. And we’ve been warning about it because we said, look, building new uranium supply is hard. It’s not as easy as I will tell you in a feasibility study. Restarting assets that are already licensed and already permitted is hard, as you see from the efforts from some of the smaller producers to come back to the market. And we’ve always said this is a highly trade-dependent commodity. It is one where the vast majority of production occurs in nation the supply are greater than the risk to demand. So in our industry, we tend to have long lead times on the transportation requirements.

So for example, when somebody wants delivery, there’s a nonbinding notice that’s sent over a year in advance of delivery beginning to signal that it’s time to start putting in place and the actual transportation commitments can be made. So unlike other commodities, we are not just in time for stumbling around and looking for transport options. Having said that, it is still challenging. The tariff overhang. The uncertainty around who owns the Panama Canal. The transportation logistics of establishing new channels like we saw in Central Asia. These are all challenges for the industry that are now adding to that getting rather full bucket of risks to supply. So I would watch the transportation piece. I wouldn’t fall asleep on it. Cameco has never missed a delivery.

We never will miss a delivery, but that doesn’t mean others aren’t going to struggle with the transportation challenges.

Lawson Winder: Thank you very much.

Operator: The next question comes from Bob Brackett with Bernstein Research. Please go ahead.

Bob Brackett: Good morning. I’m struck by last week’s announcement of 10 new reactors from China, the $27 billion number that you alluded to. And in that context, how do you think of Westinghouse’s relationship with China amidst the tariff and trade disputes we’re having?

Tim Gitzel: Well, Bob, thanks for the question. Obviously, we watch with great interest as well. China, whether you deal with them or you don’t, they are a mighty force in the nuclear space and 10 reactors a year been announced over the last four years in a row, and you do the math on that, they’ll be at 100 by 2030 and probably 200 on by 2040 and then we start thinking about where the fuel — on the chemical side where the fuel is going to come from to service those and all of the rest of the reactors around the world. So that’s — I mean when we talk optimism and durable demand and a great future. China is a big part of it. Westinghouse has a relationship with China. Obviously, the CAP 1000s that they’re building there now of Westinghouse origin. And I know there’s some enduring agreements between Westinghouse and China on each of those units to perform work on those. So I think the relationship is very strong. and Cameco as well has a good relationship with China.

Bob Brackett: And is there an opportunity there where China doing more business with Westhouse helps balance out some of the trade balance. And what would the timing of that look like? If the announcement of the reactors hits April ’27, when do those turn into feed or when do those turn into sort of capital commitments?

Tim Gitzel: Yes. That’s a good question. Your first question is the interesting one, and it’s really a geopolitical question with really what we’ve been dealing with the last number of months, the relations between China and Canada, China and the U.S., China and the rest of the world, Canada, U.S. We have a new Prime Minister and government, as you know, in Canada as of this week. And so we’ll see how that goes with — at the political level between Canada and China. On a B2B business-to-business level, the relationship has been strong and enduring. And I’ll just talk — ask Grant if he has anything to add.

Grant Isaac: Yes. One of the common threads to all of the tariff discussion and trade disruption is we want a better deal. And what we’ve discovered after spending a lot of time in Washington, a deal on energy is a really compelling story. So any time you have an opportunity for a U.S. business to expand and project U.S. energy strategy, it tends to be favorably well received. So we’re delighted to see the CAP1000 become a really important part of China’s new build Westinghouse enjoys what Dan Littman and team call Phase 2 of their relationship with the Chinese. There are instrumentation and control contracts. There are fabrication contracts, which benefit the United States to be a participant in that. And also, let’s just remind ourselves that for everybody out there who says we don’t know how to build gigawatt scale reactors, the Chinese are building essentially the AP1000 in 60 months at a cost of about $2.5 billion of reactors.

So the world knows how to do this, and it’s done by starting and not stopping, continuing that momentum, getting to the Nth unit. So, I think there’s two really important messages: One, an energy deal is always well received; and number two, we see the benefits of a nation that starts to build and continues to build in every country, the Western countries included, can certainly follow in those footsteps.

Bob Brackett: Very clear. Thank you.

Operator: The next question comes from Gordon Johnson with GLJ Research. Please go ahead.

Gordon Johnson: Hey, gentlemen, thanks for taking the question. I have, I guess, a more general question. I have a lot of clients asking those. But can you guys talk about the extent to which your projected demand on your output is affecting your current investment in new exploration? And I ask because given the global slowdown in exploration we’ve seen over the past two years after Fukushima, you guys laid off a bunch of people, a number of people laid off. It seems like there’s a big gap in the cycle. I’m just trying to figure out how you guys are planning for that?

Tim Gitzel: Yes. Thanks, Gordon. So obviously, exploration is very important to our strategy. We just put a new Vice President in place. Alexandre Aubin is our new VP of Exploration. We continue our efforts. As we’ve said many times in the past, we’ve held on to through those lean years, all of the, we think, are the best properties in the Athabasca Basin, we continue to work them. We’ve been growing our exploration budget over the last few years. So yes, absolutely, exploration continues to be a very, very important part of our business. We don’t stand up and brag too much about it. It’s just something that we do. We try not to blow too hard on it. It’s but we do have some very good projects. So, if you look at our report… [Technical Difficulty] Operator test, it’s Tim Gitzel. Can you hear us?

Bob Brackett: I can hear you guys now. You guys have cut out a bit.

Tim Gitzel: Okay. Sorry about that. Hopefully, you got the answer to our bottom-line exploration remain… [Technical Difficulty] Yes, it’s Tim Gitzel. I’ll just keep speaking to see if people can hear me. It’s Tim Gitzell. Grant, do you want to try your mic?

Grant Isaac: Yes. Operator, can you hear us?

Operator: Yes, you are coming in loud and clear now.

Tim Gitzel: Okay. Thank you. I’m not sure what happened. Thank you.

Grant Isaac: Maybe we can move on to the next question.

Operator: The next question comes from Craig Hutchison with TD Cowen. Please go ahead.

Craig Hutchison: Hi, good morning, guys. I want to ask a question on the fuel services business. You realized very strong pricing in the quarter, up year-over-year, quarter-over-quarter. And as I mentioned about mainly a result of contracts were entered as an improved pricing environment. Can you just provide some context? Is that a function of a mix of the products you were selling — and is there potential upside here to your guidance just given the strong environment for some of those services? Thanks.

Tim Gitzel: I’m going to ask Heidi Shockey to provide some comments.

Heidi Shockey: Yes, hi there. It was a bit — a couple of things going on really. You’re seeing the rolling on of new contracts. So just — as you know, we layer in contracts over time. So slowly, you see older contracts rolling off and improvement in our prices. And just in this quarter, in particular, we had just the timing of one particular contract that had a higher price, less so on the mix of products, but just really the mix of contracts in this particular quarter.

Grant Isaac: As we look ahead, Craig, it’s always important to remember that our strategy is about contracting forward. Again, if I refer to that Slide 6 that was in Tim’s comments or 16 in the handout, you remember that, that spot sliver is no different for conversion than it is for uranium, and that is — there is no utility on the planet that’s loading a fuel bundle in 2025 that needs to buy the uranium and conversion in 2025. So, we’re always selling forward. And why do I say that? Well, to your question about what to expect. The historic pricing that’s come through the conversion business, it is not yet being realized by us. So, all of that is in front of us from a pricing point of view. So you’re beginning to see the early days of strong performance, as a result of that much stronger pricing and conversion, but certainly more to come.

That’s how we build our strategy and you’re seeing it being executed, and it just yet is another reason we’re delighted with our position in the nuclear fuel cycle.

Craig Hutchison: Great. Thanks. Maybe just a quick follow-up question for me. In the past, you guys have given great color on floors and ceilings. Can you just kind of give some color on where those sit right now in terms of your discussions?

Grant Isaac: Yes, happy to do that. We continue to be very stubborn, Craig. We — you heard me say in Q4 that there is a bit of connective tissue between the spot market and the long-term market with respect to market-related contracts. Remember, those are the contracts for which we’re not trying to price them today. We’re pricing them at time of delivery out into the future. But many are — tend to orient that conversation around. Operator, do we still have you?

Craig Hutchison: I’m still there, you’re kind of coming in and out on my line.

Grant Isaac: Okay. I’m not sure what’s going on. The floors and ceilings, we orient around where the structural demand and supply is in the market on a forward basis. But no doubt, when you have primary producers bringing small volumes of production to the spot market and putting downward pressure on it or when you have a fund like a fund out of Central Asia that was being dissolved rather clumsily, it puts down or to where we should be with respect to floors and ceilings in contracts out into the future. So, we’re still holding out for floors that are in the $70 escalated. [Technical Difficulty]

Operator: We have lost connection with our speakers. Please wait while we reconnect.

Grant Isaac: Feeling to come rather than try to chase it, and we’re liking the setup.

Operator: The next question comes from Andrew Wong with RBC Capital Markets. Please go ahead.

Andrew Wong: Hey good morning. So aside from China, India, the other country with pretty ambitious nuclear energy plans and obviously, it’s taking a little bit of time to get it going. But seems like they’ve taken some actions to speed that up recently. Can you just talk about that nuclear growth opportunity in India and the potential there for Cameco Westinghouse specifically? I recall a few years ago, there was a then AP1000 project that was Shell because of liability issues, but it seems like those issues might be getting addressed. So maybe just talk about that? Thanks.

Tim Gitzel: Yes. Thanks, Andrew. You’re cutting a note on us. I think the question was on India and some of the recent announcements. [Audio gap] is a big stretch, very ambitious. We have good relations with India. We’ve been supplying them since 2015 on the Cameco side. And so we continue to talk to them. And hopefully, the Canada India relationship will — at the political level will improve going forward. But then again, that’s not stopped to set the business-to-business level. So from the Cameco point of view, we have a great relationship with India, and we’ll be a big player in supplying their fuel needs going forward. Westinghouse same. I know they have teams over there working with the Indians talking about future growth there.

And so I don’t have any specifics yet there was a site put aside for Westinghouse units. I think it still exists. So nothing really to report, Andrew, on that at this point, but — we’re still working — and India is going to play a big role in the future in the world and in the nuclear market.

Andrew Wong: Okay, thank you. Maybe just another question. In your conversations with utility customers, you have a lot of those. How much of the inventory that’s held by the physical funds come up in the conversation? And just curious from your perspective, is there still a view among the utilities that those pounds may be available in the future at some point? Or is there a better understanding that those accounts mostly aren’t going to be available?

Grant Isaac: Hi Andrew, it’s a bit mixed. You would have picked up some of that messaging in Montreal while you were there as well. I think we’re in one of those markets where folks are looking at that structural deficit and then they’re cleaning to hope of something. And one of that areas of hope is well, maybe if you can get your hands on uranium that’s already in a can and already in North America, well, that’s my that’s my hope that’s going to bail me out from the fact that I haven’t been contracting. So, we’ve seen a lot of what I might call noise around the SPET vehicle, for example, where we’ve seen a lot of noise around the yellow cake vehicle. And I would just say that it seems like it’s noise. I haven’t heard anything from either of those two that suggests they’re not in it for the long run.

But more importantly, those are almost irrelevant volumes now in the face of the structural deficit. I mean they couldn’t even begin to plug a one-year gap just a few years out. So yes, there are some who point to it and say, well, this material must come to the market at some point. I’d tell you, we worry about it less and less and less every day.

Andrew Wong: That’s great. Thank you.

Operator: This concludes the question-and-answer session. Ladies and gentlemen, we’d like to apologize for the clarity of the audio. I would like to turn the conference back over to Tim Gitzel for any closing remarks.