Uranium Participation Corporation Reports Financial Results for the Year Ended February 29, 2016
TORONTO, ONTARIO--(Marketwired - May 5, 2016) -
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Uranium Participation Corp. (TSX:U) ("UPC" of the "Corporation") reports results for the year ended February 29, 2016. All amounts are in Canadian dollars unless otherwise noted.
Total equity ("Net Asset Value") decreased by $81.6 million in the year ended February 29, 2016, mainly as a result of the net loss during the year as discussed below. The Net Asset Value at February 29, 2016 and February 28, 2015 were:
| February 29, 2016 | February 28, 2015 | |||
| Net asset value (in thousands) | $ | 649,479 | $ | 731,058 |
| Net asset value per common share - basic and diluted | $ | 5.62 | $ | 6.26 |
| U3O8 spot price(1) (US$) | $ | 32.15 | $ | 38.75 |
| UF6 spot price(1) (US$) | $ | 90.00 | $ | 107.00 |
| Foreign exchange noon-rate (US$ to CAD$) | 1.3523 | 1.2508 | ||
| (1) | Spot prices as published by Ux Consulting Company, LLC ("UxC"). Translation to Canadian dollars is calculated at the period-end foreign exchange noon-rate. |
The net loss for the year ended February 29, 2016 was mainly due to unrealized net losses on investments in uranium of $71,181,000, storage fees of $2,347,000 and management fees of $2,216,000, slightly offset by the realized gain on sale of uranium of $1,027,000. The net gain for the year ended February 28, 2015 was mainly due to unrealized net gains on investments in uranium of $134,606,000, slightly offset by storage fees of $2,431,000, management fees of $1,871,000 and transaction fees of $919,000.
Unrealized net losses on investments in uranium during the year ended February 29, 2016 were caused by an overall decrease in spot prices, partly offset by the increase in the U.S. dollar to Canadian dollar exchange rate to 1.3523 from 1.2508 during the fiscal year. The spot prices during the fiscal year decreased to US$32.15 per pound U3O8 and US$90.00 per KgU as UF6 at February 29, 2016, from US$38.75 per pound U3O8 and US$107.00 per KgU as UF6 at February 28, 2015.
Unrealized net gains on investments in uranium during the year ended February 28, 2015 were caused by an overall increase in spot prices from US$35.50 per pound U3O8 and US$99.00 per KgU as UF6 at February 28, 2014, as well as an increase in the U.S. dollar to Canadian dollar foreign exchange noon-rate from 1.0867 during the fiscal year.
UPC's NAV per share decreased to $5.62 at February 29, 2016, from $6.26 at February 28, 2015. Total equity decreased to $649,479,000 at February 29, 2016, from $731,058,000 at February 28, 2015.
The Corporation had an effective tax rate of nil for the years ended February 29, 2016 and February 28, 2015, primarily due to the fact that the Company's available tax shelter and cost basis related to its investments in uranium give rise to a net deductible temporary difference - for which the Company does not recognize deferred tax assets.
About Uranium Participation Corporation
Uranium Participation Corp. is a company that invests substantially all of its assets in uranium oxide in concentrates ("U3O8") and uranium hexafluoride ("UF6") (collectively "uranium"), with the primary investment objective of achieving appreciation in the value of its uranium holdings through increases in the uranium price. Additional information about Uranium Participation Corporation is available on SEDAR at www.sedar.com and on Uranium Participation Corp.'s website at www.uraniumparticipation.com.
Cautionary Statement Regarding Forward-Looking Statements
Certain information contained in this press release constitutes forward looking statements or forward looking information. These statements can be identified by the use of forward looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "plan", "should", "believe" or "continue" or the negative thereof or variations thereon or similar terminology. In particular, this press release contains forward-looking information pertaining to expectations regarding the uranium market factors and spot prices.
By their very nature, forward looking statements involve numerous factors, assumptions and estimates. A variety of factors, many of which are beyond the control of UPC, may cause actual results to differ materially from the expectations expressed in the forward looking statements. For a list of the principal risks of an investment in UPC, please refer to the "RISK FACTORS" section in the Corporation's Annual Information Form dated May 11, 2015 available under UPC's profile at www.sedar.com. These and other factors should be considered carefully, and readers are cautioned not to place undue reliance on these forward looking statements. Although management reviews the reasonableness of its assumptions and estimates, unusual and unanticipated events may occur which render them inaccurate. Under such circumstances, future performance may differ materially from those expressed or implied by the forward looking statements. Except where required under applicable securities legislation, UPC does not undertake to update any forward looking information.
Contact
Uranium Participation Corp.
David Cates
President & Chief Executive Officer
(416) 979-1991 Ext. 362
Uranium Participation Corp.
Mac McDonald
Chief Financial Officer
(416) 979-1991 Ext. 242