26th Apr 2019 11:23
LONDON (Alliance News) - Uranium investor Yellow Cake PLC on Friday expressed confidence in the outlook for the commodity, despite a fall in its price.
Uranium finished the first quarter of 2019 at USD25.75 per ounce of triuranium octoxide, a uranium compound, despite reaching USD28.90 at the end of January.
Aggressive sellers entered the market in March, Yellow Cake said, offering lower prices to sell off their assets by the end of the quarter.
The uranium market also has been held back by uncertainty ahead of an upcoming US Department of Commerce decision on a petition relating to the US Trade Expansion Act. The petition was filed by a US uranium miner looking for trade relief for the US uranium mining industry.
Yellow Cake's net asset value at March 31 was GBP2.24 per share, made up of 8.4 million pounds of triuranium octoxide as well as some other assets. At the London equities close on Thursday, Yellow Cake was quoted at 212.00 pence a share, a 5% discount to net asset value.
Shares were at 214.00p on Friday morning, up 0.9%.
"Our confidence in the long-term outlook for uranium is unchanged despite the short-term uncertainty created by the Section 232 investigation in the US," said Chief Executive Andre Liebenberg.
"We see robust market fundamentals regardless of the outcome of the Section 232 investigation, where rising demand and constrained supply, together with the steady run-off of long-term contracts has created a positive price environment."
"The recent pullback in the uranium price provided us with a good opportunity to acquire additional uranium at a competitive price. Demand from institutional investors in the offering was strong, highlighting continued investor interest in uranium, and we thank them for their continued support."
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