Cameco to suspend production from McArthur River and Key Lake operations and reduce its dividend - Seite 2

Cameco has committed sales volumes of 28 to 30 million pounds in 2018. Using inventory to help meet contract commitments now allows Cameco to draw down its inventory without suffering a loss by selling at low market prices. It also avoids the risk of holding excess inventory valued above market prices on its balance sheet if prices remain low.

This measure is consistent with other actions Cameco has implemented over the past five years as part of a deliberate and disciplined strategy to strengthen the company in the long term. We have reduced supply, avoided selling into a weak spot market, resisted locking-in long-term sales commitments at low prices, and significantly reduced costs.

To decrease costs, we suspended production at the Rabbit Lake operation, stopped development and curtailed production at our US operations, reduced workforce across all our sites including head office, changed air commuter services for operations in Saskatchewan, changed shift schedules at two Saskatchewan sites, and downsized corporate office functions including a consolidation of our global marketing activities.

As discussed in our third quarter 2017 MD&A, year over year, average unit cost of sales (including depreciation and amortization) is down 13%, our cash production costs are down 10%, and direct administration costs are down 20%. Planned capital expenditures for 2017 are expected to be 26% lower than in 2016.

"To date, we have made good progress in reducing costs but unfortunately given the continued market weakness, more needs to be done," said Gitzel. "We can't control the market so our focus is on positioning the company to weather the continued low uranium prices and have uncommitted, low-cost supply to deliver into a strengthening market."

In addition, Cameco's board of directors has determined that the company's annual dividend in 2018 will be $0.08 per common share, a reduction of $0.32 per common share on an annual basis. Further, the board has approved a change in the dividend payment schedule to an annual payment instead of quarterly. This change does not impact the quarterly dividend, announced on October 27, 2017, of $0.10 per common share payable on January 15, 2018, to shareholders of record at the close of business on December 29, 2017.