UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 5, 2016
UR-ENERGY INC.
(Exact name of registrant as specified in its charter)
| Canada | 001- 33905 | Not applicable |
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
| 10758 W Centennial Road, Suite 200 | |
| Littleton, Colorado | 80127 |
| (Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code: (720) 981-4588
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 2.02 | Results of Operations and Financial Condition. |
On May 6, 2016, Ur-Energy Inc. issued a press release announcing its financial results for the first quarter ended March 31, 2016.
A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information in this Current Report on Form 8-K, including the information set forth in Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing by the company under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
| Item 5.07 | Submission of Matters to a Vote of Security Holders |
The Company held its Annual and Special Meeting of Shareholders (the “Meeting”) on May 5, 2016. At the Meeting, five proposals were submitted to the shareholders for approval as set forth in the Company’s definitive proxy statement, filed April 8, 2016. As of March 31, 2016, the record date for the meeting, a total of 143,350,685 Common Shares were outstanding and entitled to vote. In total, 80,982,004 Common Shares were present in person or represented by proxy at the Meeting, which represented 56.49% of the Common Shares outstanding and entitled to vote as of the record date.
Proposal No. 1 – Election of Directors. The shareholders elected all of the directors presented to the shareholders. For the election of directors, there were a total of 44,250,038 broker non-votes.
| Name | For | % | Withheld | % | ||||||||||||
| Jeffrey T. Klenda | 36,259,381 | 98.73 | 467,478 | 1.27 | ||||||||||||
| James M. Franklin | 33,954,108 | 92.45 | 2,772,751 | 7.55 | ||||||||||||
| Paul Macdonell | 33,911,803 | 92.34 | 2,815,056 | 7.66 | ||||||||||||
| W. William Boberg | 35,605,016 | 96.95 | 1,121,843 | 3.05 | ||||||||||||
| Thomas Parker | 33,938,613 | 92.41 | 2,788,246 | 7.59 | ||||||||||||
| Gary C. Huber | 35,626,736 | 97.00 | 1,100,123 | 3.00 | ||||||||||||
Proposal No. 2 – Reappointment of PricewaterhouseCoopers LLP as our independent auditors of the Company and authorization for the directors to fix the remuneration of the auditors.
| For | Withheld | |
| 80,037,633 | 939,264 |
Proposal No. 3 – Advisory (non-binding) vote regarding the compensation of the Company’s named executive officers.
| For | Against | Broker Non Vote | ||
| 34,464,672 | 2,267,294 | 44,250,038 |
Proposal No. 4 – Approval and reconfirming of the Company’s Amended Restricted Share Unit Plan.(1)
| For | Against | Broker Non Vote | ||
| 21,418,657 | 10,553,697 | 44,250,038 |
(1) Does not include 4,759,612 shares of certain insiders and their affiliates, which were excluded from the shares voted.
Proposal No. 5 – Resolution to approve and confirm By-Law No. 2 (Advance Notice By-Law).
| For | Against | Broker Non Vote | ||
| 35,530,192 | 1,201,774 | 44,250,038 |
| Item 9.01 | Financial Statements and Exhibits. |
| (d) | Exhibits. |
| Exhibit No. |
Description | ||
| 99.1 | Press release of Ur-Energy Inc., dated May 6, 2016, reporting financial results for the first quarter ended March 31, 2016.* |
| *This Exhibit is intended to be furnished to, not filed with, the SEC pursuant to General Instruction B.2 of Form 8-K. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: May 10, 2016
| Ur-Energy Inc. | |||
| By: | /s/ Penne A. Goplerud | ||
| Name: | Penne A. Goplerud | ||
| Title: | Corporate Secretary and General Counsel | ||
EXHIBIT INDEX
| Exhibit No. |
Description | ||
| 99.1 | Press release of Ur-Energy Inc., dated May 6, 2016, reporting financial results for the first quarter ended March 31, 2016.* |
| *This Exhibit is intended to be furnished to, not filed with, the SEC pursuant to General Instruction B.2 of Form 8-K. |
Exhibit 99.1
Ur-Energy Releases 2016 Q1 Results; Webcast May 11, 2016
Littleton, Colorado (PR Newswire – May 6, 2016) Ur-Energy Inc. (NYSE MKT:URG TSX:URE,) (“Ur-Energy” or the “Company”) has filed the Company’s Form 10-Q for the quarter ended March 31, 2016, with the U.S. Securities and Exchange Commission at www.sec.gov/edgar.shtml and with Canadian securities authorities on SEDAR at www.sedar.com.
Chairman of the Company, Jeff Klenda noted “Our program of term-priced contracts, which are in place through the end of the decade, is serving us extremely well in the current challenging market environment. Our Board of Directors is to be commended for its foresight and commitment to safeguard the Company and its shareholders with these contracts. Also key in this market, Lost Creek operations continue to be reliable, at industry-leading costs of production.
Lost Creek Uranium Production and Sales
During the three months ended March 31, 2016, 159,331 pounds of U3O8 were captured within the Lost Creek plant. 173,844 pounds were packaged in drums and 182,150 pounds of the drummed inventory were shipped to the conversion facility. We sold 75,000 pounds of U3O8 during the quarter. Inventory, production and sales figures for the Lost Creek Project are presented in the following tables.
| Production Costs | Unit | 2016 Q1 | 2015 Q4 | 2015 Q3 | 2015 Q2 | |||||||||||||||
| Pounds captured | lb | 159,331 | 211,717 | 172,282 | 207,268 | |||||||||||||||
| Ad valorem and severance tax | $ | 000 | $ | 420 | $ | 470 | $ | 674 | $ | 310 | ||||||||||
| Wellfield cash cost (1) | $ | 000 | $ | 1,013 | $ | 1,017 | $ | 990 | $ | 830 | ||||||||||
| Wellfield non-cash cost (1)(2) | $ | 000 | $ | 731 | $ | 619 | $ | 1,087 | $ | 1,333 | ||||||||||
| Ad valorem and severance tax per pound captured | $/lb | $ | 2.64 | $ | 2.22 | $ | 3.91 | $ | 1.50 | |||||||||||
| Cash cost per pound captured | $/lb | $ | 6.36 | $ | 4.80 | $ | 5.75 | $ | 4.00 | |||||||||||
| Non-cash cost per pound captured | $/lb | $ | 4.59 | $ | 2.92 | $ | 6.31 | $ | 6.43 | |||||||||||
| Pounds drummed | lb | 173,844 | 189,480 | 176,850 | 183,858 | |||||||||||||||
| Plant cash cost (3) | $ | 000 | $ | 1,696 | $ | 1,687 | $ | 1,824 | $ | 1,983 | ||||||||||
| Plant non-cash cost (2)(3) | $ | 000 | $ | 497 | $ | 497 | $ | 498 | $ | 498 | ||||||||||
| Cash cost per pound drummed | $/lb | $ | 9.76 | $ | 8.90 | $ | 10.31 | $ | 10.79 | |||||||||||
| Non-cash cost per pound drummed | $/lb | $ | 2.86 | $ | 2.63 | $ | 2.82 | $ | 2.71 | |||||||||||
| Pounds shipped to conversion facility | lb | 182,150 | 181,568 | 184,380 | 179,672 | |||||||||||||||
| Distribution cash cost (4) | $ | 000 | $ | 88 | $ | 128 | $ | 80 | $ | 141 | ||||||||||
| Cash cost per pound shipped | $/lb | $ | 0.48 | $ | 0.70 | $ | 0.43 | $ | 0.78 | |||||||||||
| Pounds purchased | lb | - | - | - | 200,000 | |||||||||||||||
| Purchase costs | $ | 000 | $ | - | $ | - | $ | - | $ | 7,878 | ||||||||||
| Cash cost per pound purchased | $/lb | $ | - | $ | - | $ | - | $ | 39.39 | |||||||||||
Notes:
| 1 | Wellfield costs include all wellfield operating costs plus amortization of the related mineral property acquisition costs and depreciation of the related asset retirement obligation costs. Wellfield construction and development costs, which include wellfield drilling, header houses, pipelines, power lines, roads, fences and disposal wells, are treated as development expense and are not included in wellfield operating costs. |
| 2 | Non-cash costs include depreciation of plant equipment, capitalized ARO costs and amortization of the investment in the mineral property acquisition costs. The expenses are calculated on a straight line basis so the expense is constant for each quarter. The cost per pound from these costs will therefore vary based on production levels only. |
| 3 | Plant costs include all plant operating costs, site overhead costs and depreciation of the related plant construction and asset retirement obligation costs. |
| 4 | Distribution costs include all shipping costs and costs charged by the conversion facility for weighing, sampling, assaying and storing the U3O8 prior to sale. |
| Sales and cost of sales | Unit | 2016 Q1 | 2015 Q4 | 2015 Q3 | 2015 Q2 | |||||||||||||||
| Pounds sold | lb | 75,000 | 225,000 | 150,000 | 404,000 | |||||||||||||||
| U3O8 sales | $ | 000 | $ | 2,709 | $ | 7,756 | $ | 8,459 | $ | 18,213 | ||||||||||
| Average contract price | $/lb | $ | 39.35 | $ | 28.49 | $ | 66.71 | $ | 46.88 | |||||||||||
| Average spot price | $/lb | $ | 34.50 | $ | 36.18 | $ | 35.75 | $ | 36.50 | |||||||||||
| Average price per pound sold | $/lb | $ | 36.12 | $ | 34.47 | $ | 56.39 | $ | 45.08 | |||||||||||
| U3O8 cost of sales (1) | $ | 000 | $ | 1,855 | $ | 5,931 | $ | 4,180 | $ | 13,791 | ||||||||||
| Ad valorem and severance tax cost per pound sold | $/lb | $ | 2.61 | $ | 2.80 | $ | 2.59 | $ | 2.78 | |||||||||||
| Cash cost per pound sold | $/lb | $ | 15.41 | $ | 15.42 | $ | 15.19 | $ | 16.15 | |||||||||||
| Non-cash cost per pound sold | $/lb | $ | 6.71 | $ | 8.13 | $ | 10.09 | $ | 10.05 | |||||||||||
| Cost per pound sold - produced | $/lb | $ | 24.73 | $ | 26.35 | $ | 27.87 | $ | 28.98 | |||||||||||
| Cost per pound sold - purchased | $/lb | $ | - | $ | - | $ | - | $ | 39.39 | |||||||||||
| Average cost per pound sold | $/lb | $ | 24.73 | $ | 26.35 | $ | 27.87 | $ | 34.14 | |||||||||||
| U3O8 gross profit | $ | 000 | $ | 854 | $ | 1,825 | $ | 4,279 | $ | 4,422 | ||||||||||
| Gross profit per pound sold | $/lb | $ | 11.39 | $ | 8.11 | $ | 28.52 | $ | 10.94 | |||||||||||
| Gross profit margin | % | 31.5 | % | 23.5 | % | 50.6 | % | 24.3 | % | |||||||||||
| Ending Inventory Balances | ||||||||||||||||||||
| Pounds | ||||||||||||||||||||
| In-process inventory | lb | 71,602 | 88,788 | 71,860 | 79,036 | |||||||||||||||
| Plant inventory | lb | 22,062 | 30,367 | 22,455 | 30,006 | |||||||||||||||
| Conversion facility inventory | lb | 173,178 | 63,776 | 102,782 | 66,314 | |||||||||||||||
| Total inventory | lb | 266,842 | 182,931 | 197,097 | 175,356 | |||||||||||||||
| Total cost | ||||||||||||||||||||
| In-process inventory | $ | 000 | $ | 977 | $ | 994 | $ | 1,121 | $ | 1,219 | ||||||||||
| Plant inventory | $ | 000 | $ | 569 | $ | 742 | $ | 712 | $ | 850 | ||||||||||
| Conversion facility inventory | $ | 000 | $ | 4,388 | $ | 1,609 | $ | 3,025 | $ | 1,815 | ||||||||||
| Total inventory | $ | 000 | $ | 5,934 | $ | 3,345 | $ | 4,858 | $ | 3,884 | ||||||||||
| Cost per pound | ||||||||||||||||||||
| In-process inventory | $/lb | $ | 13.64 | $ | 11.20 | $ | 15.60 | $ | 15.42 | |||||||||||
| Plant inventory | $/lb | $ | 25.79 | $ | 24.43 | $ | 31.71 | $ | 28.33 | |||||||||||
| Conversion facility inventory | $/lb | $ | 25.34 | $ | 25.23 | $ | 29.43 | $ | 27.37 | |||||||||||
Notes:
| 1 | Cost of sales include all production costs (notes 1, 2, 3 and 4 in the previous Inventory and Production table) adjusted for changes in inventory values. |
U3O8 sales of $2.7 million for 2016 Q1 were based on selling 75,000 pounds at an average price of $36.12, with a regularly-scheduled contract delivery of 25,000 pounds and a sale of 50,000 pounds on the spot market. For the quarter, our cost of sales totaled $1.9 million based on selling 75,000 pounds from production at a total cost per pound of $24.73, down from $26.35 in the previous quarter. As most of the sales were from inventory already at the conversion facility, the cost per pound sold was not reflective of the increased cost per pound produced for the quarter.
The gross profit from uranium sales for the quarter was $0.9 million, which represents a gross profit margin of approximately 32%. This was higher than the previous quarter due to higher contract price and a decrease in costs mainly associated with the change in the non-cash wellfield costs in the fourth quarter of 2015 which flowed through to cost of sales in the current quarter.
| Total Cost Per Pound Sold Reconciliation | Unit | 2016 Q1 | 2015 Q4 | 2015 Q2 | 2015 Q2 | |||||||||||||||
| Ad valorem & severance taxes | $ | 000 | $ | 420 | $ | 470 | $ | 674 | $ | 310 | ||||||||||
| Wellfield costs | $ | 000 | $ | 1,744 | $ | 1,636 | $ | 2,077 | $ | 2,163 | ||||||||||
| Plant and site costs | $ | 000 | $ | 2,193 | $ | 2,184 | $ | 2,322 | $ | 2,481 | ||||||||||
| Distribution costs | $ | 000 | $ | 88 | $ | 128 | $ | 80 | $ | 141 | ||||||||||
| Inventory change | $ | 000 | $ | (2,590 | ) | $ | 1,513 | $ | (973 | ) | $ | 818 | ||||||||
| Cost of sales - produced | $ | 000 | $ | 1,855 | $ | 5,931 | $ | 4,180 | $ | 5,913 | ||||||||||
| Cost of sales - purchased | $ | 000 | $ | — | $ | — | $ | — | $ | 7,878 | ||||||||||
| Total cost of sales | $ | 000 | $ | 1,855 | $ | 5,931 | $ | 4,180 | $ | 13,791 | ||||||||||
| Pounds sold produced | lb | 75,000 | 225,000 | 150,000 | 204,000 | |||||||||||||||
| Pounds sold purchased | lb | — | — | — | 200,000 | |||||||||||||||
| Total pounds sold | lb | 75,000 | 225,000 | 150,000 | 404,000 | |||||||||||||||
| Average cost per pound sold - produced (1) | $/lb | $ | 24.73 | $ | 26.35 | $ | 27.87 | $ | 28.98 | |||||||||||
| Average cost per pound sold - purchased | $/lb | $ | - | $ | - | $ | - | $ | 39.39 | |||||||||||
| Total average cost per pound sold | $/lb | $ | 24.73 | $ | 26.35 | $ | 27.87 | $ | 34.14 | |||||||||||
| 1 | The cost per pound sold reflects both cash and non-cash costs, which are combined as cost of sales in the statement of operations included in this filing. The cash and non-cash cost components are identified in the above inventory, production and sales table. |
The cost of sales includes ad valorem and severance taxes related to the extraction of uranium, all costs of wellfield, plant and site operations including the related depreciation and amortization of capitalized assets, reclamation and mineral property costs, plus product distribution costs. These costs are also used to value inventory and the resulting inventoried cost per pound is compared to the estimated sales prices based on the contracts or spot sales anticipated for the distribution of the product. Any costs in excess of the calculated market value are charged to cost of sales.
Continuing Guidance for 2016
As a result of the continuing low spot price environment, we anticipate that we will continue to maintain production at levels that will be consistent with our contractual sales obligations, which are 662,000 pounds at an average realizable price of $47.61 per pound (including the deliveries assigned during the quarter) in the current year. The monthly 2016 production target for Lost Creek is to dry and drum an average of 55,000 to 60,000 pounds U3O8. Production at this level will permit delivery into our 2016 term contract commitments, discretionary spot sales, and the continuing buildup of our inventory, with an estimated final production for 2016 within the previously-projected range of 650,000 to 750,000 pounds U3O8. Our production rate may be adjusted based on operational refinements, and indicators in the market, including uranium spot market and term pricing, and other factors. The assignment of delivery obligations we made in March 2016 permits us greater flexibility to make such operational decisions and/or to continue to build inventory.
We ended the quarter with 195,240 pounds of dried and drummed U3O8 in ending inventory, of which 173,178 pounds were held at the conversion facility. The increase in inventory is the result of continued drumming and shipments to the converter at targeted production rates, together with lower scheduled deliveries into sales contracts and only one spot sale. At the end of the quarter, the average cash cost per pound in the conversion facility ending inventory was $15.85, an increase from $15.39 at the end of the previous quarter, and is reflective of the increased cost per pound produced for the quarter, which was again primarily driven by the lower production levels.
Webcast and Teleconference
A webcast and teleconference will be held on Wednesday, May 11, 2016 at 9:00 a.m. (MT) / 11:00 a.m. (ET) to discuss the results and provide an operational update. A Q&A session will follow the presentation. Those wishing to participate by phone can do so by calling:
US Toll-free Number 1-877-226-2859
Canada Toll-free Number 1-855-669-9657
International Number 1-412-542-4134
Ask to be joined into the Ur-Energy call.
The call is being webcast by PR Newswire. The webcast can be accessed 10 minutes prior to the call. Pre-registration and participation access is available by clicking here or by copying the following URL into your web browser:
https://www.webcaster4.com/Webcast/Page/1186/14900
If you are unable to join the call, a link will be available following the webcast on the Company’s website www.ur-energy.com.
About Ur-Energy
Ur-Energy is a junior uranium mining company operating the Lost Creek in-situ recovery uranium facility in south-central Wyoming. The Lost Creek processing facility has a two million pounds per year nameplate capacity. The Company has begun to submit applications for permits and licenses to operate Shirley Basin. Ur-Energy is engaged in uranium mining, recovery and processing activities, including the acquisition, exploration, development and operation of uranium mineral properties in the United States. Shares of Ur-Energy trade on the NYSE MKT under the symbol “URG” and on the Toronto Stock Exchange under the symbol “URE.” All currency figures in this announcement are in US dollars unless otherwise stated. Ur-Energy’s corporate office is located in Littleton, Colorado; its registered office is in Ottawa, Ontario. Ur-Energy’s website is www.ur-energy.com.
FOR FURTHER INFORMATION, PLEASE CONTACT
| Rich Boberg, Senior Director IR/PR | Jeffrey T. Klenda, Chair, Executive Director |
| 866-981-4588 | 866-981-4588 |
| rich.boberg@ur-energy.com | jeff.klenda@ur-energy.com |
Cautionary Note Regarding Forward-Looking Information
This release may contain “forward-looking statements” within the meaning of applicable securities laws regarding events or conditions that may occur in the future (e.g., results of production and continued maintenance of steady state operations at the Lost Creek facility; ability to meet production targets and to timely deliver into existing contractual obligations; whether the Company’s long term contracts adequately protect against market volatility; the ability to realize the technical and economic viability of the Lost Creek Project as set forth in the PEA for the Lost Creek Property) and are based on current expectations that, while considered reasonable by management at this time, inherently involve a number of significant business, economic and competitive risks, uncertainties and contingencies. Factors that could cause actual results to differ materially from any forward-looking statements include, but are not limited to, capital and other costs varying significantly from estimates; failure to establish estimated resources and reserves; the grade and recovery of ore which is mined varying from estimates; production rates, methods and amounts varying from estimates; delays in obtaining or failures to obtain required governmental, environmental or other project approvals; inflation; changes in exchange rates; fluctuations in commodity prices; delays in development and other factors described in the public filings made by the Company at www.sedar.com and www.sec.gov. Readers should not place undue reliance on forward-looking statements. The forward-looking statements contained herein are based on the beliefs, expectations and opinions of management as of the date hereof and Ur-Energy disclaims any intent or obligation to update them or revise them to reflect any change in circumstances or in management’s beliefs, expectations or opinions that occur in the future.