ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
52-2107911
|
(State of incorporation)
|
(I.R.S. Employer Identification No.)
|
Title of Each Class
|
Trading Symbol
|
Name of Each Exchange on Which Registered
|
Class A Common Stock, par value $0.10 per share
|
LEU
|
NYSE American
|
Large accelerated filer
|
o
|
|
Accelerated filer
|
o
|
|
Non-accelerated filer
|
ý
|
Smaller reporting company
|
ý
|
|
Emerging growth company
|
o
|
|
|
|
|
|
Page
|
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PART I – FINANCIAL INFORMATION
|
|
|
|
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||
|
||
|
||
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||
|
||
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||
|
|
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PART II – OTHER INFORMATION
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
109.2
|
|
|
$
|
130.7
|
|
Accounts receivable
|
17.5
|
|
|
21.1
|
|
||
Inventories
|
67.9
|
|
|
64.5
|
|
||
Deferred costs associated with deferred revenue
|
144.1
|
|
|
144.1
|
|
||
Other current assets
|
7.8
|
|
|
9.2
|
|
||
Total current assets
|
346.5
|
|
|
369.6
|
|
||
Property, plant and equipment, net of accumulated depreciation of $2.3 as of March 31, 2020 and $2.2 as of December 31, 2019
|
3.6
|
|
|
3.7
|
|
||
Deposits for financial assurance
|
5.7
|
|
|
5.7
|
|
||
Intangible assets, net
|
68.1
|
|
|
69.5
|
|
||
Other long-term assets
|
6.9
|
|
|
7.4
|
|
||
Total assets
|
$
|
430.8
|
|
|
$
|
455.9
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable and accrued liabilities
|
$
|
50.7
|
|
|
$
|
50.7
|
|
Payables under SWU purchase agreements
|
6.1
|
|
|
8.1
|
|
||
Inventories owed to customers and suppliers
|
7.4
|
|
|
5.6
|
|
||
Deferred revenue and advances from customers
|
243.0
|
|
|
266.3
|
|
||
Current debt
|
6.1
|
|
|
6.1
|
|
||
Total current liabilities
|
313.3
|
|
|
336.8
|
|
||
Long-term debt
|
111.0
|
|
|
114.1
|
|
||
Postretirement health and life benefit obligations
|
134.7
|
|
|
138.6
|
|
||
Pension benefit liabilities
|
137.2
|
|
|
141.8
|
|
||
Advances from customers
|
29.4
|
|
|
29.4
|
|
||
Other long-term liabilities
|
30.6
|
|
|
32.1
|
|
||
Total liabilities
|
756.2
|
|
|
792.8
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
|
|
||
Stockholders’ deficit:
|
|
|
|
||||
Preferred stock, par value $1.00 per share, 20,000,000 shares authorized
|
|
|
|
||||
Series A Participating Cumulative Preferred Stock, none issued
|
—
|
|
|
—
|
|
||
Series B Senior Preferred Stock, 7.5% cumulative, 104,574 shares issued and outstanding and an aggregate liquidation preference of $129.2 as of March 31, 2020 and $127.2 as of December 31, 2019
|
4.6
|
|
|
4.6
|
|
||
Class A Common Stock, par value $0.10 per share, 70,000,000 shares authorized, 8,783,189 and 8,347,427 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively
|
0.8
|
|
|
0.8
|
|
||
Class B Common Stock, par value $0.10 per share, 30,000,000 shares authorized, 719,200 and 1,117,462 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively
|
0.1
|
|
|
0.1
|
|
||
Excess of capital over par value
|
61.8
|
|
|
61.5
|
|
||
Accumulated deficit
|
(393.7
|
)
|
|
(405.0
|
)
|
||
Accumulated other comprehensive income, net of tax
|
1.0
|
|
|
1.1
|
|
||
Total stockholders’ deficit
|
(325.4
|
)
|
|
(336.9
|
)
|
||
Total liabilities and stockholders’ deficit
|
$
|
430.8
|
|
|
$
|
455.9
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Revenue:
|
|
|
|
||||
Separative work units
|
$
|
30.7
|
|
|
$
|
12.4
|
|
Uranium
|
—
|
|
|
22.7
|
|
||
Technical solutions
|
14.3
|
|
|
3.6
|
|
||
Total revenue
|
45.0
|
|
|
38.7
|
|
||
Cost of Sales:
|
|
|
|
||||
Separative work units and uranium
|
13.3
|
|
|
38.3
|
|
||
Technical solutions
|
12.1
|
|
|
5.9
|
|
||
Total cost of sales
|
25.4
|
|
|
44.2
|
|
||
Gross profit (loss)
|
19.6
|
|
|
(5.5
|
)
|
||
Advanced technology costs
|
0.9
|
|
|
6.6
|
|
||
Selling, general and administrative
|
8.5
|
|
|
8.1
|
|
||
Amortization of intangible assets
|
1.4
|
|
|
1.1
|
|
||
Special charges (credits) for workforce reductions
|
(0.1
|
)
|
|
(0.1
|
)
|
||
Gain on sales of assets
|
—
|
|
|
(0.4
|
)
|
||
Operating income (loss)
|
8.9
|
|
|
(20.8
|
)
|
||
Nonoperating components of net periodic benefit expense (income)
|
(2.2
|
)
|
|
(0.1
|
)
|
||
Interest expense
|
0.1
|
|
|
1.0
|
|
||
Investment income
|
(0.4
|
)
|
|
(0.7
|
)
|
||
Income (loss) before income taxes
|
11.4
|
|
|
(21.0
|
)
|
||
Income tax expense (benefit)
|
0.1
|
|
|
(0.1
|
)
|
||
Net income (loss) and comprehensive income (loss)
|
11.3
|
|
|
(20.9
|
)
|
||
Preferred stock dividends - undeclared and cumulative
|
2.0
|
|
|
2.0
|
|
||
Net income (loss) allocable to common stockholders
|
$
|
9.3
|
|
|
$
|
(22.9
|
)
|
|
|
|
|
||||
Net income (loss) per common share:
|
|
|
|
|
|
||
Basic
|
$
|
0.97
|
|
|
$
|
(2.40
|
)
|
Diluted
|
$
|
0.95
|
|
|
$
|
(2.40
|
)
|
Average number of common shares outstanding (in thousands):
|
|
|
|
|
|
||
Basic
|
9,619
|
|
|
9,532
|
|
||
Diluted
|
9,839
|
|
|
9,532
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
OPERATING
|
|
|
|
||||
Net income (loss)
|
$
|
11.3
|
|
|
$
|
(20.9
|
)
|
Adjustments to reconcile net loss to cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
1.5
|
|
|
1.3
|
|
||
PIK interest on paid-in-kind toggle notes
|
—
|
|
|
0.4
|
|
||
Gain on sales of assets
|
—
|
|
|
(0.4
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
3.6
|
|
|
11.2
|
|
||
Inventories, net
|
0.1
|
|
|
25.6
|
|
||
Accounts payable and other liabilities
|
1.3
|
|
|
1.2
|
|
||
Payables under SWU purchase agreements
|
(1.9
|
)
|
|
(46.0
|
)
|
||
Deferred revenue and advances from customers, net of deferred costs
|
(23.3
|
)
|
|
—
|
|
||
Accrued loss on long-term contract
|
(3.5
|
)
|
|
—
|
|
||
Pension and postretirement benefit liabilities
|
(8.6
|
)
|
|
(4.2
|
)
|
||
Other, net
|
1.0
|
|
|
(0.1
|
)
|
||
Cash used in operating activities
|
(18.5
|
)
|
|
(31.9
|
)
|
||
|
|
|
|
||||
INVESTING
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
FINANCING
|
|
|
|
||||
Payments for deferred financing costs
|
(0.1
|
)
|
|
—
|
|
||
Exercise of stock options
|
0.2
|
|
|
—
|
|
||
Payment of interest classified as debt
|
(3.1
|
)
|
|
(3.1
|
)
|
||
Cash used in financing activities
|
(3.0
|
)
|
|
(3.1
|
)
|
||
|
|
|
|
||||
Decrease in cash, cash equivalents and restricted cash
|
(21.5
|
)
|
|
(35.0
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of period (Note 4)
|
136.6
|
|
|
159.7
|
|
||
Cash, cash equivalents and restricted cash, end of period (Note 4)
|
$
|
115.1
|
|
|
$
|
124.7
|
|
|
|
|
|
||||
Supplemental cash flow information:
|
|
|
|
||||
Interest paid in cash
|
$
|
—
|
|
|
$
|
0.4
|
|
Non-cash activities:
|
|
|
|
||||
Conversion of interest payable-in-kind to debt
|
$
|
—
|
|
|
$
|
0.7
|
|
Deferred financing costs included in accounts payable and accrued liabilities
|
$
|
(0.5
|
)
|
|
$
|
—
|
|
|
Preferred Stock,
Series B
|
|
Common Stock,
Class A,
Par Value
$.10 per Share
|
|
Common Stock,
Class B,
Par Value
$.10 per Share
|
|
Excess of
Capital Over
Par Value
|
|
Accumulated Deficit
|
|
Accumulated
Other Comprehensive Income (Loss)
|
|
Total
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance at December 31, 2018
|
$
|
4.6
|
|
|
$
|
0.8
|
|
|
$
|
0.1
|
|
|
$
|
61.2
|
|
|
$
|
(388.5
|
)
|
|
$
|
(0.1
|
)
|
|
$
|
(321.9
|
)
|
Net loss for the three months ended March 31, 2019
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20.9
|
)
|
|
—
|
|
|
(20.9
|
)
|
|||||||
Issuance and amortization of restricted stock units and stock options
|
—
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|||||||
Balance at March 31, 2019
|
4.6
|
|
|
0.8
|
|
|
0.1
|
|
|
61.3
|
|
|
(409.4
|
)
|
|
(0.1
|
)
|
|
(342.7
|
)
|
Balance at December 31, 2019
|
$
|
4.6
|
|
|
$
|
0.8
|
|
|
$
|
0.1
|
|
|
$
|
61.5
|
|
|
$
|
(405.0
|
)
|
|
$
|
1.1
|
|
|
$
|
(336.9
|
)
|
Net income for the three months ended March 31, 2020
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.3
|
|
|
—
|
|
|
11.3
|
|
|||||||
Issuance and amortization of restricted stock units and stock options
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
(0.1
|
)
|
|
0.2
|
|
|||||||
Balance at March 31, 2020
|
4.6
|
|
|
0.8
|
|
|
0.1
|
|
|
61.8
|
|
|
(393.7
|
)
|
|
1.0
|
|
|
$
|
(325.4
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
United States
|
$
|
7.3
|
|
|
$
|
35.1
|
|
Foreign
|
23.4
|
|
|
—
|
|
||
Revenue - SWU and uranium
|
$
|
30.7
|
|
|
$
|
35.1
|
|
|
|
March 31, 2020
|
|
December 31,
2019
|
||||
|
|
($ millions)
|
||||||
Accounts receivable:
|
|
|
|
|
||||
Billed
|
|
$
|
7.5
|
|
|
$
|
13.2
|
|
Unbilled *
|
|
10.0
|
|
|
7.9
|
|
||
Accounts receivable
|
|
$
|
17.5
|
|
|
$
|
21.1
|
|
|
|
|
|
|
||||
* Billings under certain contracts in the technical services segment are invoiced based on approved provisional billing rates. Unbilled revenue represents the difference between actual costs incurred and invoiced amounts. The Company expects to invoice and collect the unbilled amounts after actual rates are submitted to the customer and approved. Unbilled revenue also includes unconditional rights to revenue that are not yet billable under applicable contracts pending the compilation of supporting documentation.
|
|
|
March 31,
2020
|
|
December 31, 2019
|
|
Year-To-Date Change
|
||||||
Accrued loss on HALEU Contract:
|
|
|
|
|
|
|
||||||
Current - Accounts payable and accrued liabilities
|
|
$
|
9.7
|
|
|
$
|
10.0
|
|
|
$
|
(0.3
|
)
|
Noncurrent - Other long-term liabilities
|
|
$
|
5.6
|
|
|
$
|
8.3
|
|
|
$
|
(2.7
|
)
|
Deferred revenue - current
|
|
$
|
243.0
|
|
|
$
|
243.0
|
|
|
$
|
—
|
|
Advances from customers - current
|
|
$
|
—
|
|
|
$
|
23.3
|
|
|
$
|
(23.3
|
)
|
Advances from customers - noncurrent
|
|
$
|
29.4
|
|
|
$
|
29.4
|
|
|
$
|
—
|
|
|
|
Liability
December 31,
2019
|
|
Three Months Ended
March 31, 2020 |
|
Liability
March 31,
2020
|
||||||||||
|
|
|
Charges (Credits) for Termination Benefits
|
|
Paid/
Settled
|
|
||||||||||
Workforce reductions:
|
|
|
|
|
|
|
|
|
||||||||
Corporate functions
|
|
$
|
1.2
|
|
|
$
|
(0.1
|
)
|
|
$
|
(1.1
|
)
|
|
$
|
—
|
|
Piketon facility
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
0.2
|
|
||||
Total
|
|
$
|
1.4
|
|
|
$
|
(0.1
|
)
|
|
$
|
(1.1
|
)
|
|
$
|
0.2
|
|
|
March 31,
2020
|
|
December 31, 2019
|
||||
|
|
|
|
||||
Cash and cash equivalents
|
$
|
109.2
|
|
|
$
|
130.7
|
|
Deposits for financial assurance - current
|
0.2
|
|
|
0.2
|
|
||
Deposits for financial assurance - noncurrent
|
5.7
|
|
|
5.7
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
115.1
|
|
|
$
|
136.6
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||
|
Current
Assets
|
|
Current
Liabilities
(a)
|
|
Inventories, Net
|
|
Current
Assets
|
|
Current
Liabilities
(a)
|
|
Inventories, Net
|
||||||||||||
Separative work units
|
$
|
9.2
|
|
|
$
|
2.8
|
|
|
$
|
6.4
|
|
|
$
|
7.8
|
|
|
$
|
—
|
|
|
$
|
7.8
|
|
Uranium
|
58.7
|
|
|
4.6
|
|
|
54.1
|
|
|
56.7
|
|
|
5.6
|
|
|
51.1
|
|
||||||
Total
|
$
|
67.9
|
|
|
$
|
7.4
|
|
|
$
|
60.5
|
|
|
$
|
64.5
|
|
|
$
|
5.6
|
|
|
$
|
58.9
|
|
(a)
|
Inventories owed to customers and suppliers, included in current liabilities, include SWU and uranium inventories owed to fabricators.
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Amount
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Amount
|
||||||||||||
Sales order book
|
$
|
54.6
|
|
|
$
|
30.1
|
|
|
$
|
24.5
|
|
|
$
|
54.6
|
|
|
$
|
29.9
|
|
|
$
|
24.7
|
|
Customer relationships
|
68.9
|
|
|
25.3
|
|
|
43.6
|
|
|
68.9
|
|
|
24.1
|
|
|
44.8
|
|
||||||
Total
|
$
|
123.5
|
|
|
$
|
55.4
|
|
|
$
|
68.1
|
|
|
$
|
123.5
|
|
|
$
|
54.0
|
|
|
$
|
69.5
|
|
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
|
Maturity
|
|
Current
|
|
Long-Term
|
|
Current
|
|
Long-Term
|
||||||||
8.25% Notes:
|
Feb. 2027
|
|
|
|
|
|
|
|
|
||||||||
Principal
|
|
|
$
|
—
|
|
|
$
|
74.3
|
|
|
$
|
—
|
|
|
$
|
74.3
|
|
Interest
|
|
|
6.1
|
|
|
36.7
|
|
|
6.1
|
|
|
39.8
|
|
||||
Total
|
|
|
$
|
6.1
|
|
|
$
|
111.0
|
|
|
$
|
6.1
|
|
|
$
|
114.1
|
|
•
|
Level 1 – quoted prices for identical instruments in active markets.
|
•
|
Level 2 – quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.
|
•
|
Level 3 – valuations derived using one or more significant inputs that are not observable.
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cash and cash equivalents
|
$
|
109.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
109.2
|
|
|
$
|
130.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
130.7
|
|
Deferred compensation asset (a)
|
1.5
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
|
1.8
|
|
|
—
|
|
|
—
|
|
|
1.8
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred compensation obligation (a)
|
$
|
1.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.5
|
|
|
$
|
1.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.8
|
|
(a)
|
The deferred compensation obligation represents the balance of deferred compensation plus net investment earnings. The deferred compensation plan is funded through a rabbi trust. Trust funds are invested in mutual funds for which unit prices are quoted in active markets and are classified within Level 1 of the valuation hierarchy.
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
|
Carrying Value
|
|
Estimated Fair Value (a)
|
|
Carrying Value
|
|
Estimated Fair Value (a)
|
||||||||
8.25% Notes
|
$
|
117.1
|
|
(b)
|
$
|
54.7
|
|
|
$
|
120.2
|
|
(b)
|
$
|
61.5
|
|
(b)
|
The carrying value of the 8.25% Notes consists of the principal balance of $74.3 million and the sum of current and noncurrent interest payment obligations until maturity. Refer to Note 7, Debt.
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Service costs
|
$
|
0.9
|
|
|
$
|
0.8
|
|
Interest costs
|
6.1
|
|
|
7.6
|
|
||
Amortization of prior service costs (credits), net
|
(0.1
|
)
|
|
—
|
|
||
Expected return on plan assets (gains)
|
(9.4
|
)
|
|
(9.1
|
)
|
||
Net periodic benefit (credits)
|
$
|
(2.5
|
)
|
|
$
|
(0.7
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Interest costs
|
$
|
1.2
|
|
|
$
|
1.5
|
|
Net periodic benefit costs
|
$
|
1.2
|
|
|
$
|
1.5
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Numerator (in millions):
|
|
|
|
||||
Net income (loss)
|
$
|
11.3
|
|
|
$
|
(20.9
|
)
|
Preferred stock dividends - undeclared and cumulative
|
2.0
|
|
|
2.0
|
|
||
Net income (loss) allocable to common stockholders
|
$
|
9.3
|
|
|
$
|
(22.9
|
)
|
|
|
|
|
||||
Denominator (in thousands):
|
|
|
|
||||
Average common shares outstanding - basic
|
9,619
|
|
|
9,532
|
|
||
Potentially dilutive shares related to stock options and restricted stock units (a)
|
220
|
|
|
—
|
|
||
Average common shares outstanding - diluted
|
9,839
|
|
|
9,532
|
|
||
|
|
|
|
||||
Net income (loss) per common share (in dollars):
|
|
|
|
|
|
||
Basic
|
$
|
0.97
|
|
|
$
|
(2.40
|
)
|
Diluted
|
$
|
0.95
|
|
|
$
|
(2.40
|
)
|
|
|
|
|
||||
(a) Common stock equivalents excluded from the diluted calculation as a result of a net loss in the period (in thousands)
|
—
|
|
|
41
|
|
||
|
|
|
|
||||
Options outstanding and considered anti-dilutive as their exercise price exceeded the average share market price (in thousands)
|
—
|
|
|
360
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Revenue
|
|
|
|
||||
LEU segment:
|
|
|
|
||||
Separative work units
|
$
|
30.7
|
|
|
$
|
12.4
|
|
Uranium
|
—
|
|
|
22.7
|
|
||
Total
|
30.7
|
|
|
35.1
|
|
||
Technical solutions segment
|
14.3
|
|
|
3.6
|
|
||
Total revenue
|
$
|
45.0
|
|
|
$
|
38.7
|
|
|
|
|
|
||||
Segment Gross Profit (Loss)
|
|
|
|
||||
LEU segment
|
$
|
17.4
|
|
|
$
|
(3.2
|
)
|
Technical solutions segment
|
2.2
|
|
|
(2.3
|
)
|
||
Gross profit (loss)
|
$
|
19.6
|
|
|
$
|
(5.5
|
)
|
•
|
Additional purchases or sales of SWU and uranium;
|
•
|
Conditions in the LEU and energy markets, including pricing, demand, operations, and regulations;
|
•
|
Timing of customer orders, related deliveries, and purchases of LEU or components;
|
•
|
Financial market conditions and other factors that may affect pension and benefit liabilities and the value of related assets;
|
•
|
The outcome of legal proceedings and other contingencies;
|
•
|
Potential use of cash for strategic or financial initiatives;
|
•
|
Actions taken by customers, including actions that might affect existing contracts;
|
•
|
Market, international trade and other conditions impacting Centrus’ customers and the industry; and
|
•
|
The length and severity of the COVID-19 pandemic and its impact on our operations.
|
•
|
sales of the SWU component of LEU;
|
•
|
sales of both the SWU and uranium components of LEU; and
|
•
|
sales of natural uranium.
|
|
Three Months Ended
March 31, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
LEU segment
|
|
|
|
|
|
|
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
SWU revenue
|
$
|
30.7
|
|
|
$
|
12.4
|
|
|
$
|
18.3
|
|
|
148
|
%
|
Uranium revenue
|
—
|
|
|
22.7
|
|
|
(22.7
|
)
|
|
(100
|
)%
|
|||
Total
|
30.7
|
|
|
35.1
|
|
|
(4.4
|
)
|
|
(13
|
)%
|
|||
Cost of sales
|
13.3
|
|
|
38.3
|
|
|
25.0
|
|
|
65
|
%
|
|||
Gross profit (loss)
|
$
|
17.4
|
|
|
$
|
(3.2
|
)
|
|
$
|
20.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Technical solutions segment
|
|
|
|
|
|
|
|
|
|
|||||
Revenue
|
$
|
14.3
|
|
|
$
|
3.6
|
|
|
$
|
10.7
|
|
|
297
|
%
|
Cost of sales
|
12.1
|
|
|
5.9
|
|
|
(6.2
|
)
|
|
(105
|
)%
|
|||
Gross profit (loss)
|
$
|
2.2
|
|
|
$
|
(2.3
|
)
|
|
$
|
4.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total
|
|
|
|
|
|
|
|
|
|
|||||
Revenue
|
$
|
45.0
|
|
|
$
|
38.7
|
|
|
$
|
6.3
|
|
|
16
|
%
|
Cost of sales
|
25.4
|
|
|
44.2
|
|
|
18.8
|
|
|
43
|
%
|
|||
Gross profit (loss)
|
$
|
19.6
|
|
|
$
|
(5.5
|
)
|
|
$
|
25.1
|
|
|
|
|
Three Months Ended
March 31, |
|
|
|
|
|||||||||
|
2020
|
|
2019
|
|
$ Change
|
|
% Change
|
|||||||
Gross profit (loss)
|
$
|
19.6
|
|
|
(5.5
|
)
|
|
$
|
25.1
|
|
|
456
|
%
|
|
Advanced technology costs
|
0.9
|
|
|
6.6
|
|
|
5.7
|
|
|
86
|
%
|
|||
Selling, general and administrative
|
8.5
|
|
|
8.1
|
|
|
(0.4
|
)
|
|
(5
|
)%
|
|||
Amortization of intangible assets
|
1.4
|
|
|
1.1
|
|
|
(0.3
|
)
|
|
(27
|
)%
|
|||
Special charges (credits) for workforce reductions
|
(0.1
|
)
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
%
|
|||
Gain on sales of assets
|
—
|
|
|
(0.4
|
)
|
|
(0.4
|
)
|
|
(100
|
)%
|
|||
Operating income (loss)
|
8.9
|
|
|
(20.8
|
)
|
|
29.7
|
|
|
143
|
%
|
|||
Nonoperating components of net periodic benefit expense (income)
|
(2.2
|
)
|
|
(0.1
|
)
|
|
2.1
|
|
|
2,100
|
%
|
|||
Interest expense
|
0.1
|
|
|
1.0
|
|
|
0.9
|
|
|
90
|
%
|
|||
Investment income
|
(0.4
|
)
|
|
(0.7
|
)
|
|
(0.3
|
)
|
|
(43
|
)%
|
|||
Income (loss) before income taxes
|
11.4
|
|
|
(21.0
|
)
|
|
32.4
|
|
|
154
|
%
|
|||
Income tax expense (benefit)
|
0.1
|
|
|
(0.1
|
)
|
|
(0.2
|
)
|
|
(200
|
)%
|
|||
Net income (loss)
|
11.3
|
|
|
(20.9
|
)
|
|
32.2
|
|
|
154
|
%
|
|||
Preferred stock dividends - undeclared and cumulative
|
2.0
|
|
|
2.0
|
|
|
—
|
|
|
—
|
%
|
|||
Net income (loss) allocable to common stockholders
|
$
|
9.3
|
|
|
$
|
(22.9
|
)
|
|
$
|
32.2
|
|
|
141
|
%
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Cash used in operating activities
|
$
|
(18.5
|
)
|
|
$
|
(31.9
|
)
|
Cash provided by investing activities
|
—
|
|
|
—
|
|
||
Cash used in financing activities
|
(3.0
|
)
|
|
(3.1
|
)
|
||
Decrease in cash, cash equivalents and restricted cash
|
$
|
(21.5
|
)
|
|
$
|
(35.0
|
)
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Cash and cash equivalents
|
$
|
109.2
|
|
|
$
|
130.7
|
|
Accounts receivable
|
17.5
|
|
|
21.1
|
|
||
Inventories, net
|
60.5
|
|
|
58.9
|
|
||
Current debt
|
(6.1
|
)
|
|
(6.1
|
)
|
||
Deferred revenue and advances from customers, net of deferred costs
|
(98.9
|
)
|
|
(122.2
|
)
|
||
Other current assets and liabilities, net
|
(49.0
|
)
|
|
(49.6
|
)
|
||
Working capital
|
$
|
33.2
|
|
|
$
|
32.8
|
|
Exhibit No.
|
Description
|
|
|
4.1
|
Third Amendment to the Section 382 Rights Agreement, dated as of April 13, 2020, by and among Centrus Energy Corp., Computershare Trust Company N.A. and Computershare Inc. (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the SEC on April 14, 2020).
|
|
|
10.1
|
Voting and Nomination Agreement, dated April 13, 2020, by and among Centrus Energy Corp. and the MB Group (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on April 14, 2020).
|
|
|
10.2
|
Consulting Agreement dated January 2, 2020 between the Company and Stephen S. Greene (certain personally identifiable information has been omitted) (incorporated by reference to Exhibit 10.62 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 27, 2020). (b)
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
101
|
Unaudited condensed consolidated financial statements from the Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, filed in interactive data file (XBRL) format.
|
(a)
|
Filed herewith.
|
(b)
|
Management contracts and compensatory plans and arrangements required to be filed as exhibits pursuant to Item 6 of this report.
|
|
Centrus Energy Corp.
|
|
|
May 12, 2020
|
/s/ Philip O. Strawbridge
|
|
Philip O. Strawbridge
|
|
Senior Vice President, Chief Financial Officer,
|
|
Chief Administrative Officer and Treasurer
|
|
(Duly Authorized Officer and Principal Financial Officer)
|
Grant Date
|
April 27, 2020
|
Number of Shares Subject to Stock Appreciation Right
|
|
Exercise Date
|
The end of the 20th trading day immediately following the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
|
Grant Date
|
April 27, 2020
|
Number of Notional Stock Units
|
|
Settlement Date
|
The end of the 20th trading day immediately following the filing of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Centrus Energy Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting that are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
May 12, 2020
|
/s/ Daniel B. Poneman
|
|
Daniel B. Poneman
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Centrus Energy Corp.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
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The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting that are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
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May 12, 2020
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/s/ Philip O. Strawbridge
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Philip O. Strawbridge
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Senior Vice President, Chief Financial Officer, Chief Administrative Officer and Treasurer
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May 12, 2020
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/s/ Daniel B. Poneman
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Daniel B. Poneman
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President and Chief Executive Officer
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May 12, 2020
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/s/ Philip O. Strawbridge
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Philip O. Strawbridge
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Senior Vice President, Chief Financial Officer, Chief Administrative Officer and Treasurer
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