* Q3 adjusted EPS C$0.20 vs C$0.24 a year earlier
* Revenue down 24 pct to C$419 mln
* Shares end 8.5 pct higher in Toronto on uranium prices
(Updates with closing stock price; in U.S. dollars unless
TORONTO, Nov 8 Shares of Cameco Corp (CCO.TO)
surged on Monday after a weekend jump in uranium prices, even
as the Canadian miner said its quarterly operating profit
dropped on higher spending and a decline in sales volumes.
Cameco also raised its 2010 uranium production forecast and
lowered its capital expenditure outlook for the year, dulling
the sting of the 15 percent drop in its third-quarter operating
The Saskatchewan-based company said it expects to deliver a
third of its overall uranium sales for 2010 in the fourth
quarter, signaling a strong performance for the final three
months of the year.
"The uranium spot price has increased 10.6 percent to
$57.50 per pound over the weekend," said Macquarie analyst
Duncan McKeen, in a note to clients. "This significant increase
follows a number of weeks of upward movement to the spot
Shares of smaller rivals Uranium One UUU.TO, First
Uranium FIU.TO and Denison Mines (DML.TO) all posted gains on
the Toronto Stock Exchange on Monday.
The company expects uranium production to be 22 million
pounds this year, compared with its previous estimate of 21.5
million pounds, with increased production at Rabbit Lake in
Saskatchewan and Inkai in Kazakhstan.
Cameco also expects capital expenditures to come in at
about C$475 million in 2010, down from its previous estimate of
C$510 million, due to changes in the scheduling of some
The company said it does not expect this reduction in its
2010 capital expenditure budget to affect its long-term goal of
doubling uranium output by 2018.
Excluding gains from financial instruments and other
one-time items, Cameco reported adjusted earnings of C$80
million, or 20 Canadian cents a share. That compared with a
profit of C$94 million, or 24 Canadian cents a share, a year
Net income in the quarter was C$98 million, or 25 Canadian
cents a share. That compared with a year-before profit of C$172
million, or 44 Canadian cents a share.
Quarterly revenue fell 19 percent to C$419 million, due to
a 33 percent decrease in uranium sales volumes.
Analysts, on average, had forecast adjusted earnings of 21
Canadian cents a share, on revenue of C$467.2 million,
according to Thomson Reuters I/B/E/S.
"While uranium sales in the third quarter were lower
compared to a year ago, gross profit in our core business
actually increased due to higher realized prices and lower
product costs," Chief Executive Jerry Grandey noted on a
Cameco shares closed 8.5 percent higher at $35.98 on the
Toronto Stock Exchange, and 7.46 percent higher at C$35.74 on
the New York Stock Exchange.
(Reporting by Euan Rocha, editing by Frank McGurty)