enCore Energy Corp. (EU)·Q2 2025 Earnings Summary

Executive Summary

• Mixed quarter: revenue fell sharply on lower scheduled deliveries (60k lbs vs 290k in Q1), but EPS improved year over year; gross profit turned positive on much lower costs per lb sold ($42.23 vs $115.87 YoY) .
• EPS missed Wall Street “Primary EPS” consensus by ~$0.01 as lighter delivery cadence weighed on the P&L; revenue consensus was not available (limited coverage)*. Drivers: fewer deliveries in Q2 vs Q1, higher OpEx tied to ramp, offset by realized gains on marketable securities .
• Operations ramped: Q2 extraction rose 79% sequentially to 203,798 lbs; daily production averaged 1,942–2,678 lbs/day in Apr–Jun; inventory built to 244,204 lbs at $39.63/lb, positioning for heavier 2H deliveries .
• Strategic catalysts: Upper Spring Creek added to Rosita RML enabling satellite IX build-out ; management targets 30 rigs in Q3 to accelerate wellfield development . Potential stock reaction catalysts: sustained extraction gains, delivery cadence normalization, and permitting milestones .

What Went Well and What Went Wrong

• What Went Well

  • Extraction ramp and efficiency: Q2 U3O8 extraction 203,798 lbs (+79% QoQ); daily production averaged 2,678 lbs/day in June, 2,103 in May, 1,942 in April .
  • Cost structure: Costs per lb sold fell to $42.23 from $115.87 YoY; realized price rose to $61.07 from $59.11 YoY, supporting positive gross profit .
  • Permitting and growth: Upper Spring Creek included in Rosita’s Radioactive Materials License; construction of satellite IX plant and wellfields commenced .
  • Management quote: “The continued improvements in our rate of uranium extraction and advancement of wellfield development are truly a result of a top performing team…” — William M. Sheriff, Executive Chairman .

• What Went Wrong

  • Light delivery quarter: Revenue dropped to $3.664M (vs $18.239M in Q1; $5.320M YoY) on only 60k lbs delivered in Q2 .
  • Operating expenses: Total operating expenses rose to $20.4M from $17.9M YoY, reflecting growth and activity levels tied to ramp .
  • Controls and litigation overhang: Material weaknesses in ICFR persist; ongoing securities litigation and employment-related arbitrations add uncertainty .

Financial Results

Revenue, EPS, unit economics and profitability

KPIs and balance sheet

Notes: Gross margin for Q2 2025 was ~30.8% (Gross Profit $1.130M / Revenue $3.664M ).

Guidance Changes

Earnings Call Themes & Trends

Note: A Q2 earnings call transcript was not available; we reference the Aug 27 investor update and filings.

Management Commentary

• “The continued improvements in our rate of uranium extraction and advancement of wellfield development are truly a result of a top performing team…” — William M. Sheriff, Executive Chairman .
• “We’ve seen… production increases averaging well over 2,500 pounds a day… we’ve more than doubled [rigs]… We are in a big growth phase.” — Robert Willette, Acting CEO (Investor Update) .
• “We will make our production this year and deliveries without buying any uranium in the market.” — William M. Sheriff (Investor Update) .
• “Biggest challenge is really the permitting… The future is pretty much in our hands… urgency and execution.” — William M. Sheriff (Investor Update) .

Q&A Highlights

• Guidance: Management reiterated intention to meet 2025 deliveries without market purchases and will provide multi‑year delivery projections annually; no 2026 production guidance until permits finalize .
• Permitting: Dewey Burdock renewals/proceedings advancing; company expects resolution and no delays to development .
• Capital/convertible: August convertible provided flexibility and broadened investor base; proceeds earmarked for Alta Mesa/Upper Spring Creek and northern tier projects (post‑Q2 development context) –.

Estimates Context

• Q2 2025 EPS: Actual $(0.03) vs S&P Global “Primary EPS” consensus mean of approximately $(0.02), a miss of ~$0.01* .
• Q2 2025 Revenue: Actual $3.664M; revenue consensus unavailable due to limited coverage* .
• Estimate depth: EPS estimate count = 1*, indicating thin sell‑side coverage.
  Values retrieved from S&P Global.*

Key Takeaways for Investors

• Delivery phasing, not demand, drove revenue compression; commitments suggest heavier delivery volumes ahead (305k lbs remainder 2025; 900k–1,500k lbs annually through 2029) .
• Structural cost improvement: transition from purchased pounds to extracted pounds dropped costs/lb, improving gross profitability at moderate realized prices .
• Execution focus: rig additions (to 30), wellfield expansion, and Upper Spring Creek’s RML inclusion can sustain extraction growth and reduce per‑unit costs into 2H .
• Risk watchlist: internal control remediation and litigation remain active; monitor remediation milestones and legal updates .
• Tactical: Stock likely reacts to monthly production updates, delivery executions, and permitting milestones; lighter quarters on delivery cadence may present opportunities ahead of heavier shipment periods .
• Medium term: As satellite IX capacity comes online and inventory builds convert to deliveries, earnings sensitivity improves with uranium prices and delivery schedule normalization .

Supporting Data Details

Unit cost and inventory detail (non‑GAAP disclosed)

• Costs of U3O8 sold H1’25: 350k lbs at $59.42/lb (incl. purchased 225k at $68.58; extracted 125k at $42.92; cash cost $28.86; non‑cash $14.06) .
• Inventory at 6/30/25: 244,204 lbs at $39.63/lb (purchased 20k at $59.42; extracted 224,204 at $37.87; cash $27.20; non‑cash $10.67) .

Operational timelines

• Daily production cadence improved through Q2; management aims to increase rigs to 30 in Q3 to sustain wellfield expansion .
• Upper Spring Creek satellite IX and wellfield construction commenced upon RML inclusion (feeds Rosita CPP), supporting 2026 throughput .

Unavailable materials

• A Q2 earnings call transcript was not available; qualitative themes were drawn from the Aug 27 investor update and the Q2 10‑Q/press release – – –.

Footnote: Values marked with an asterisk (*) are retrieved from S&P Global.