(Reuters) - Canadian uranium producer Cameco Corp (CCO.TO) (CCJ.N) on Tuesday said it expected its 2016 adjusted profit to be significantly lower than analysts’ estimates and also said it would cut 120 jobs at three of its uranium mines in 2017.
The Saskatoon, Canada-based company said it expects to report a net loss for 2016 citing asset impairments resulting from fair market assessments at the end of the year. The average estimate among Reuters’ analysts was a profit of 86 cents per share for 2016.
Cameco said it plans to reduce workforce at the McArthur River, Key Lake and Cigar Lake operations by 10 percent.
“The current earnings expectations do...reflect the consequences of a continued weak uranium market and our resolve to make the necessary decisions to defend and preserve our core uranium business for the long-term benefit of our stakeholders,” Chief Executive Officer Tim Gitzel said in a statement.
Cameco reported a 35 percent rise in uranium sales in the quarter ended Sept. 30, even at a time when uranium prices are near multiyear lows.
Excess supplies has kept uranium prices at record lows, forcing mining companies to mothball mines, slice costs and cut debt as they struggle to survive.
Reporting by Gayathree Ganesan in Bengaluru