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Share Name Share Symbol Market Type Share ISIN Share Description
Yellow Cake Plc LSE:YCA London Ordinary Share JE00BF50RG45 ORD GBP0.01
  Price Change % Change Share Price Shares Traded Last Trade
  1.00 0.27% 365.20 847,817 16:28:37
Bid Price Offer Price High Price Low Price Open Price
364.40 365.20 372.80 362.00 362.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
General Industrials 317.40 197.77 1.7 671
Last Trade Time Trade Type Trade Size Trade Price Currency
18:21:11 O 5,000 366.07 GBX

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Posted at 08/12/2022 08:20 by Yellow Cake Daily Update
Yellow Cake Plc is listed in the General Industrials sector of the London Stock Exchange with ticker YCA. The last closing price for Yellow Cake was 364.20p.
Yellow Cake Plc has a 4 week average price of 360p and a 12 week average price of 360p.
The 1 year high share price is 486.80p while the 1 year low share price is currently 294p.
There are currently 183,671,232 shares in issue and the average daily traded volume is 839,840 shares. The market capitalisation of Yellow Cake Plc is £670,767,339.26.
Posted at 21/11/2022 07:03 by jonwig
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Mark Carney has a new sideline: he is helping to build nuclear power stations. Last month, as vice-chairman of Brookfield Asset Management, the former Bank of England governor was on hand to hail its $8 billion joint acquisition of Westinghouse, a nuclear power plant designer.

After years in the doldrums, the deal was a sign that the nuclear sector was finally sparking to life, as countries recognise its value in providing clean energy. “Every credible net-zero pathway relies on significant growth in nuclear power,” Carney said.

Demand for new nuclear power is soaring. Last week, in the autumn statement, chancellor Jeremy Hunt reaffirmed plans to build the Sizewell C reactor on the Suffolk coast. Across the Channel, France wants six new plants. The US is looking at ways to extend the life of its existing plants and China wants to build an astonishing 220-plus reactors in the coming decades, with President Xi Jinping eyeing self-sufficiency in nuclear.
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But a crunch is coming. Supply of uranium is not expected to keep up with demand and Russia has a tight grip on its production — particularly in the conversion and enrichment of uranium, the two-stage process that gives the material its potency as a nuclear fuel. Vladimir Putin has already shown how to wield power by throttling Europe’s supply of gas. Could a similar fate befall uranium?

In its natural form, uranium is fairly plentiful, found in rock and even sea water. There are large deposits in Australia, Kazakhstan, Canada, Russia and Namibia. After being mined, the ore is leached into a yellowy powder known as “yellow cake”. This material is converted and enriched into nuclear fuel through industrial processes using centrifuges, before being turned into pellets that are loaded into fuel rods for power stations.

The uranium market has been depressed since the Fukushima disaster in Japan in 2011. Prices collapsed, miners stopped mining and utilities sold off stockpiles. But, as Carney noted, nuclear power is having a renaissance. Supporters are quick to point out it can deliver emissions-free power — just as the world needs more electricity to decarbonise. Putin’s war on Ukraine has jolted every nation into rethinking its energy supply.

Russia’s share of enriched uranium is about 40 per cent globally. “There’s a shortage of enrichment supply. It’s a huge issue,” Tim Gitzel, chief executive of Canadian producer Cameco, told investors last month. He said Russia was also responsible for 27 per cent of uranium conversion and 14 per cent of mined supply. “If they’re pulling back, that’s leaving a huge gap,” he said.
President Xi Jinping may choose to copy his ally Vladimir Putin’s tactic of controlling supply of a needed resource
President Xi Jinping may choose to copy his ally Vladimir Putin’s tactic of controlling supply of a needed resource

Europe’s dependence on Russian gas has caused political and social heartache. How, then, did uranium also fall under Putin’s influence? The trend was noted by investor Marin Katusa in his 2014 book The Colder War, which devoted a chapter to the “Putinization of Uranium”.

Katusa wrote that Putin had deliberately cultivated nuclear deals with places such as Japan, Egypt and Mongolia, and described Russia’s grip on the sector as a “stranglehold”.

Putin’s war in Ukraine has created headaches for neighbouring Kazakhstan, which was responsible for 47 per cent of mined uranium supply in 2021, much of it shipped via St Petersburg. Since the war began, the country’s national uranium producer Kazatomprom has been trialling an alternative route via Azerbaijan, Georgia and the Black Sea. But shipments on this route have faced problems: Cameco, which has a joint venture with Kazatomprom, admitted that no deliveries from this business would arrive this year as they were held up by red tape in Azerbaijan.

Russian uranium has not been sanctioned as a result of the war, but utilities firms are jittery, with many reportedly rushing to sign new supply contracts. “The West is trying to wean itself off Russian material and services,” said John Ciampaglia, chief executive of Sprott Asset Management, which last year launched a uranium fund that allows investors to bet on the rising price of the commodity. He added: “There are absolutely no sanctions on any Russian nuclear fuel and the reason for that is very simple: there is no plan B.”
STB.URANIUM_PROCESS.20.11.22.R

The only alternative is to “onshore”; enrichment capability and cut Russia out of the supply chain.

“It’s somewhat analogous to semiconductors — we’ve outsourced everything for so long that we don’t do it ourselves any more,” said Ross McElroy, chief executive of Fission Uranium, which is developing a new mine in Canada.

Some experts predict it could take three to five years for that capacity to be rebuilt. The US closed its only conversion facility in 2017, but plans to reopen it next year. In the UK, some enrichment capability remains at the Springfields site in Lancashire.

The British government has woken up to the challenge and this year set up the £75 million Nuclear Fuel Fund to boost domestic supply. The business and energy committee is also scrutinising the matter. “The data suggests that there is quite a lot of political risk [with nuclear fuel supply],” said Darren Jones, the Labour MP who is the committee’s chairman. “The price is going to go up. And the UK is very reliant on international supply chains, including connections to Russia.”

Miners are licking their lips at the prospect of higher prices.

“Since the Russian invasion, energy security has become a key topic,” said Andre Liebenberg, chief executive of London-listed Yellow Cake, whose business model works by buying up uranium and sitting on it to cash in on future price rises. “There’s been a fundamental change in demand for nuclear. This is going to be a very exciting time [for uranium].”

Nick Lawson, chief executive of Ocean Wall, a niche alternatives investment house, said uranium was facing a string of “black swan” events that meant its price could finally rally. The price of yellow cake has risen 14 per cent this year to $50 a pound, but the price for converted uranium has rocketed 150 per cent, he said. “We see the next five years in uranium investing as a generational wealth-creating opportunity,” Lawson said.

Mined supply is already running at a deficit of about 60 million pounds a year. The gap is bridged by stockpiles of the material, which are running low.

“Uranium deposits are not so rare, but good ones are extremely rare,” said McElroy. He reckons prices would need to hit at least $90 a pound before miners are incentivised to bring back production. “We’re part-way towards recovery, but prices still have an awful long way to go.”

Though prices may be rising, the very long lead times to build nuclear power stations may work in Britain’s favour when it comes to securing uranium. It will give firms time to source supply, according to Professor Gregg Butler of the Dalton Nuclear Institute at Manchester University. “Most of the utilities will have two to four years of uranium stock, so they’re not going to suddenly get desperate because the price goes up,” he said. Moreover, uranium is only a relatively small part of a nuclear power station’s running costs, he added.

The bigger challenge for the UK, Butler suggested, is to pick a consistent nuclear policy and stick with it. Very few of Britain’s nuclear power stations since the 1950s have followed the same design, he noted. “The technology choices we have made as a nation have not been that wonderful,” Butler said.

As a new nuclear age dawns, there is a chance to do things differently.

Posted at 18/11/2022 16:46 by return_of_the_apeman
Skyship,

has this fallen through the support line on your previous chart?

Perhaps the 200ma will come to the rescue @385 but that is not far away and would be only a 12.3% discount

U.UN is approx. the same discount to NAV as YCA. YCA tends to normally be on a higher discount (happy to be corrected if my perception is wrong)

I would like it to get to 350 which is a 20% discount and seems to have some decent support even though it has traded at greater than 20% discount before

Perhaps I will take a small bite at 385 and a large one at 350

Just my musings

Posted at 19/10/2022 23:17 by 7kiwi
SPUT up to nearly $35m cash, but no new cash raised today and no lbs bought. But spot creeping up to $51.50 mid. Pound also weaker so YCA NAV up but share price down.
Posted at 22/9/2022 23:17 by 7kiwi
Back to a very substantial deficit to NAV, over 14% because GBP has fallen and the U3O8 spot price is ticking up again, so surely the share price should start to recover again soon.
Posted at 25/8/2022 17:08 by 7kiwi
I got this off Twitter. If the next leg of the bull market is really on, then the YCA share price may well get a turbo boost when these guys cover their shorts. Between them, they're short over 4m shares. Of course some might be part of a complex hedging strategy.
Posted at 30/6/2022 21:17 by 7kiwi
Yes, good news of sorts yupa. Another tick on the ratchet of tightening supply.

I can't quite believe the YCA share price falling in the face of a rising U3O8 price.

I am not quite sure what it will take to cause a reversal, but surely some institutions are going to find the opportunity to good to resist soon.

Posted at 13/5/2022 09:04 by 7kiwi
Mr N.

Allow me to try and answer your questions.

1) The US does not import U3O8 from Russia (or only very little). It imports both UF6 (after conversion) and enriched Uranium for fuel rods. There is talk of the US banning the import of Russian product and banning the export of U3O8 to Russia for conversion. Separately, there is talk in Russia of banning the export of Uranium products to "unfriendly" countries like US/Europe.

2) There is no talk of the US banning Uranium imports from Kazakhstan. However, the main route of Kazakh material to the west is through St. Petersburg. Even though that route is not yet formally sanctioned, the risk of sanctions and lack of ships willing to go to Russia is effectively blocking exports by that route (see Cameco announcement last week). They do have another route across the Caspian and Black Sea, avoiding Russian territory. They say they have used it before. However, practically speaking, it's difficult to get marine insurance for ships on the Black Sea at the moment, so that route is effectively blocked as well, probably until the Ukraine war ends. KAP already exports material to China, indeed it is a big customer. CGNC owns a stake in its Ortalyk mine. Plus, KAP is working on a massive stockpile/trading hub on the border with China. However, exports to the West through China have not been tried, and my understanding is that it would be difficult to obtain licenses to export from China. So, practically speaking, exports to the west from Kazakhstan look "difficult" at the moment. The first sign we have seen is that Cameco have delayed a shipment from its Inkai JV. KAP have not so far admitted any difficulties.

3) YCA has obtained most of its material from KAP. However, last year it did buy some from a Chinese trading company.

4) Whilst it would be good if YCA can keep adding material from KAP, or indeed anyone else, it isn't necessary. As others have said, it's effectively an investment trust and its pounds of U3O8 are stockpiled. The share price fluctuates around the NAV according to market sentiment.


I did ask the IR people the other day about whether there are any risks that the ~3m lbs of U3O8 YCA is due to receive over the next couple of months will not arrive. I also asked whether the material they are due to receive was already in a safe country, just awaiting title transfer. The response I got just referred me to prior RNSs and didn't really answer my questions.

So, my interpretation is that there is a risk that they aren't yet ready to disclose to the market. However, the impact is relatively small. Essentially, the NAV will be reduced by a small amount. They contracted the most recent purchases at ~$42/lb from memory. Spot now around $50. So, we would "lose" the appreciation in the U3O8 price on those 3m lbs. 3m * $8/lb difference = $24m reduction in NAV or ~2.5%. Plus they retain cash to buyback more shares or enter into deals with other parties.

Posted at 13/5/2022 07:30 by kinbasket
Mr N,

YCA is not a trading company and doesn't need to buy or sell Uranium. YCA stockpiles U so investors can effectively own the commodity by owning the shares. More like an ETC. However, If there is no more U available to buy, it doesn't matter. They don't need to issue more shares to raise more money and could use spare cash to buy back shares. Or just sit on what they have.

There is also no reason to sell any. It's not an ETF needing to provide cash for redemptions. It functions like an Investment trust. If an investor wants to sell, they sell their shares in the market. The underlying is unaffected.

The market price of YCA shares is set by the markets opinion of where the price of U is going and the balance of buyers and sellers. Currently the market is puking up an opportunity if you think the price of U will be higher in the future.

Whats happening in Kaz, Russia, the US or anywhere else is of no relevance beyond its ability to effect the price of U and therefore the value of our stockpile.

Posted at 04/4/2022 10:33 by 7kiwi
alpal,

Right now, I think there's a discount of around 6.3%. share price 437p, NAV 466p (based on Numerco mid-price of 58.62/lb on Friday and GBPUSD of 1.311).

But you're right, the buyback only kicks in if share price more than 10% below NAV. However, the buyback programme fulfils a number of objectives:

1. Highlights the persistent discount, and indicates to investors there's a bargain to be had.

2. Gives a statement of intent that big discounts will not be tolerated.

3. Puts a floor on the share price

Posted at 11/11/2021 11:17 by bpdon
With the stronger dollar, U spot price rising slightly, and the YCA share price drifting..... I calculate we are finally back to a very small discount. Good to see the froth and the excessive premium from mid October worked off.
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