BETHESDA, MD. – Centrus Energy Corp. (NYSE American: LEU) closed 2024 with significant revenue growth, expanded government contracts, and major strategic investments, but declining profits and geopolitical risks cast uncertainty over the company’s trajectory.
Revenue surges, but profit margins take a hit
Centrus reported $442.0 million in total revenue for 2024, a 38% increase from $320.2 million in 2023. Despite this surge, gross profit dipped slightly to $111.5 million, down 0.5% from $112.1 million the prior year.
Net income dropped 13.3%, landing at $73.2 million compared to $84.4 million in 2023. Earnings per share also declined:
- Basic EPS: $4.49 (2024) vs. $5.55 (2023).
- Diluted EPS: $4.47 (2024) vs. $5.44 (2023).
The decline in profitability was attributed to increased costs in the company’s Low-Enriched Uranium (LEU) segment, including a 67% rise in SWU unit costs and a 33% increase in uranium costs. A single loss contract significantly impacted LEU margins, accounting for 87% of the gross margin decline in that segment.
Government contracts drive growth
Centrus secured multiple Department of Energy (DOE) contracts for Low-Enriched Uranium (LEU) and High-Assay Low-Enriched Uranium (HALEU) production, along with HALEU Deconversion services. The company’s DOE-backed funding pool now totals $3.4 billion, positioning Centrus as a key player in the U.S. nuclear fuel supply chain.
The company continues to produce HALEU at its American Centrifuge Operating Plant in Piketon, Ohio, with DOE increasing its Phase 2 contract value to $129.0 million to support Centrus’ goal of delivering 900 kg of HALEU UF6.
Strategic investments and financial position
To bolster its domestic supply chain, Centrus announced a $60 million investment in centrifuge manufacturing at its Oak Ridge, Tennessee facility. Additionally, the company raised $402.5 million through 2.25% convertible senior notes due in 2030.
As of December 31, 2024, Centrus reported:
- Unrestricted cash balance of $671.4 million.
- Total liabilities of $932.0 million, with $472.5 million in long-term debt.
The company also transferred pension obligations for over 1,400 participants, reducing its pension liability by $277.5 million.
Geopolitical risks cloud long-term outlook
Centrus is navigating increased uncertainty due to the Prohibiting Russian Uranium Imports Act, which bans Russian LEU imports starting in August 2024. While the DOE granted temporary waivers for 2024-2025, it deferred a decision on whether Centrus can import LEU from Russia in 2026 and 2027.
Further complicating matters, Russia enacted Decree No. 1544, revoking TENEX’s general export license to the U.S. TENEX, Russia’s uranium supplier, now requires individual export approvals for each shipment—creating significant risks for Centrus’ ability to fulfill future contracts.
Backlog and future opportunities
Centrus’ backlog reached $3.7 billion at the end of 2024, extending into 2040. This includes:
- $2.8 billion in LEU contracts, with $2.0 billion in contingent sales tied to potential expansion at its Piketon, Ohio facility.
- $0.9 billion in Technical Solutions contracts, including government-funded projects.
CEO outlook: Betting on nuclear’s future
Centrus President and CEO Amir Vexler pointed to a growing demand for nuclear fuel, driven by:
- Congress’ ban on Russian uranium imports starting in 2028.
- Mothballed reactors coming back online.
- The increasing energy needs of AI and data centers.
“As the only U.S.-owned, U.S.-technology enrichment company, we are well-positioned to compete for more than $3.4 billion in federal funding, and we’re uniquely positioned to deliver a made-in-America solution that supports American jobs,” Vexler stated.
The bottom line
Centrus ended 2024 on solid financial footing, but uncertainties surrounding policy shifts, supply chain risks, and pricing pressures could define its trajectory in the coming years. While the company has positioned itself as a leader in domestic uranium enrichment, its reliance on Russian-sourced LEU and pending DOE funding decisions will determine how aggressively it can expand.
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