《Cameco Corporation (CCO) 2015年年度報告「TSX」.pdf》由會員分享，可在線閱讀，更多相關《Cameco Corporation (CCO) 2015年年度報告「TSX」.pdf（144頁珍藏版）》請在三個皮匠報告上搜索。
1、 Managements discussion and analysis February 9,2017 6 2016 PERFORMANCE HIGHLIGHTS 9 MARKET OVERVIEW AND 2016 DEVELOPMENTS 13 OUR STRATEGY 20 MEASURING OUR RESULTS 22 FINANCIAL RESULTS 51 OUR OPERATIONS AND PROJECTS 76 MINERAL RESERVES AND RESOURCES 81 ADDITIONAL INFORMATION 84 2016 CONSOLIDATED FIN
2、ANCIAL STATEMENTS This managements discussion and analysis(MD&A)includes information that will help you understand managements perspective of our audited consolidated financial statements(financial statements)and notes for the year ended December 31,2016.The information is based on what we knew as o
3、f February 8,2017.We encourage you to read our audited consolidated financial statements and notes as you review this MD&A.You can find more information about Cameco,including our financial statements and our most recent annual information form,on our website at ,on SEDAR at or on EDGAR at sec.gov.Y
4、ou should also read our annual information form before making an investment decision about our securities.The financial information in this MD&A and in our financial statements and notes are prepared according to International Financial Reporting Standards(IFRS),unless otherwise indicated.Unless we
5、have specified otherwise,all dollar amounts are in Canadian dollars.Throughout this document,the terms we,us,our,the Company and Cameco mean Cameco Corporation and its subsidiaries,including NUKEM Energy GmbH(NUKEM),unless otherwise indicated.2 CAMECO CORPORATION Caution about forward-looking inform
6、ation Our MD&A includes statements and information about our expectations for the future.When we discuss our strategy,plans,future financial and operating performance,or other things that have not yet taken place,we are making statements considered to be forward-looking information or forward-lookin
7、g statements under Canadian and United States(US)securities laws.We refer to them in this MD&A as forward-looking information.Key things to understand about the forward-looking information in this MD&A:It typically includes words and phrases about the future,such as:anticipate,believe,estimate,expec
8、t,plan,will,intend,goal,target,forecast,project,strategy and outlook(see examples below).It represents our current views,and can change significantly.It is based on a number of material assumptions,including those we have listed on page 3,which may prove to be incorrect.Actual results and events may
9、 be significantly different from what we currently expect,due to the risks associated with our business.Welist a number of these material risks on pages 2 and 3.We recommend you also review our most recent annual information form,whichincludes a discussion of other material risks that could cause ac
10、tual results to differ significantly from our current expectations.Forward-looking information is designed to help you understand managements current views of our near and longer term prospects,andit may not be appropriate for other purposes.We will not necessarily update this information unless we
11、are required to by securities laws.Examples of forward-looking information in this MD&A our expectations about 2017 and future global uraniumsupply,consumption,demand,contracting volumes,numberof reactors and nuclear generating capacity,including thediscussion under the headings Market overview and
12、2016developmentsthe discussion under the heading Our strategyour 2017 objectivesour expectations for uranium deliveries in 2017the discussion of our expectations relating to our transferpricing disputes,including our estimate of the amount andtiming of expected cash taxes and transfer pricing penalt
13、iesthe discussion of our expectations relating to our dispute withTokyo Electric Power Company Holdings,Inc.(TEPCO)our consolidated outlook for the year and the outlook for oururanium,fuel services and NUKEM segments for 2017our expectations for future tax payments and rates,includingeffective tax r
14、atesour expectations for future royalty paymentsour price sensitivity analysis for our uranium segmentour expectation that existing cash balances and operatingcash flows will meet our anticipated 2017 capitalrequirements without the need for any significant additionalfunding,other than temporary dra
15、wings on short-termliquidity during the course of the yearour expectations for 2017,2018 and 2019 capitalexpendituresour expectation that in 2017 we will be able to comply with allthe covenants in our unsecured revolving credit facilityour future plans and expectations for each of our uraniumoperati
16、ng properties and projects under evaluation,and fuelservices operating sitesour expectations related to annual Rabbit Lake care andmaintenance costsour mineral reserve and resource estimatesMaterial risks actual sales volumes or market prices for any of our productsor services are lower than we expe
17、ct for any reason,including changes in market prices or loss of market share toa competitorwe are adversely affected by changes in currency exchangerates,interest rates,royalty rates,or tax ratesour production costs are higher than planned,or our costreduction strategies are unsuccessful,or necessar
18、y suppliesare not available,or not available on commerciallyreasonable termsour estimates of production,purchases,costs,care andmaintenance,decommissioning or reclamation expenses,orour tax expense estimates prove to be inaccuratewe are unable to enforce our legal rights under our existingagreements
19、,permits or licenceswe are subject to litigation or arbitration that has an adverseoutcome,including lack of success in our disputes with taxauthorities or with TEPCOwe are unsuccessful in our dispute with Canada RevenueAgency(CRA)and this results in significantly higher cashtaxes,interest charges a
20、nd penalties than the amount of ourcumulative tax provisionwe are unable to utilize letters of credit to the extentanticipated in our dispute with CRAthere are defects in,or challenges to,title to our propertiesour mineral reserve and resource estimates are not reliable,or we face unexpected or chal
21、lenging geological,hydrological or mining conditionswe are affected by environmental,safety and regulatoryrisks,including increased regulatory burdens or delayswe cannot obtain or maintain necessary permits or approvalsfrom government authorities,including AREVAs renewal ofthe McClean Lake mills ope
22、rating licence,and our renewalof the Port Hope conversion facilitys operating licencewe are affected by political riskswe are affected by terrorism,sabotage,blockades,civilunrest,social or political activism,accident or a deteriorationin political support for,or demand for,nuclear energyMANAGEMENTS
23、DISCUSSION AND ANALYSIS 3 we are impacted by changes in the regulation or publicperception of the safety of nuclear power plants,whichadversely affect the construction of new plants,therelicensing of existing plants and the demand for uraniumthere are changes to government regulations or policies th
24、atadversely affect us,including tax and trade laws and policiesour uranium suppliers fail to fulfil delivery commitments,orour uranium purchasers fail to fulfil purchase commitmentsour McArthur River development,mining or production plansare delayed or do not succeed for any reasonour Cigar Lake dev
25、elopment,mining or production plans aredelayed or do not succeed for any reasonany difficulties with the McClean Lake mill modifications orexpansion or milling of Cigar Lake oreour expectations relating to Rabbit Lake care andmaintenance costs prove to be inaccuratewe are affected by natural phenome
26、na,including inclementweather,fire,flood and earthquakesour operations are disrupted due to problems with our own orour suppliers or customers facilities,the unavailability ofreagents,equipment,operating parts and supplies critical toproduction,equipment failure,lack of tailings capacity,labourshort
27、ages,labour relations issues,strikes or lockouts,underground floods,cave-ins,ground movements,tailingsdam failures,transportation disruptions or accidents,unanticipated consequences of our cost reduction strategies,or other development and operating risksMaterial assumptions our expectations regardi
28、ng sales and purchase volumes andprices for uranium and fuel services,and that thecounterparties to our sales and purchase agreements willhonour their commitmentsour expectations regarding the demand for uranium,theconstruction of new nuclear power plants and the relicensingof existing nuclear power
29、 plants not being more adverselyaffected than expected by changes in regulation or in thepublic perception of the safety of nuclear power plantsour expected production level and production costs,including our expectations regarding the success of our costreduction strategiesthe assumptions regarding
30、 market conditions upon which wehave based our capital expenditures expectationsour expectations regarding spot prices and realized pricesfor uranium,and other factors discussed under the headingPrice sensitivity analysis:uranium segmentour expectations regarding tax rates and payments,royaltyrates,
31、currency exchange rates and interest ratesour expectations about the outcome of disputes with taxauthorities and with TEPCOwe are able to utilize letters of credit to the extent anticipatedin our dispute with CRAour decommissioning and reclamation expensesour mineral reserve and resource estimates,a
32、nd theassumptions upon which they are based,are reliableour understanding of the geological,hydrological and otherconditions at our minesour McArthur River development,mining and productionplans succeedour Cigar Lake development,mining and production planssucceedmodification and expansion of the McC
33、lean Lake mill arecompleted as planned and the mill is able to process CigarLake ore as expectedthat annual Rabbit Lake care and maintenance costs will beas expectedour ability to continue to supply our products and services inthe expected quantities and at the expected timesour ability to comply wi
34、th current and future environmental,safety and other regulatory requirements,and to obtain andmaintain required regulatory approvals,including AREVAsrenewal of the McClean Lake mills operating licence,andour renewal of the Port Hope conversion facilitys operatinglicenceour operations are not signifi
35、cantly disrupted as a result ofpolitical instability,nationalization,terrorism,sabotage,blockades,civil unrest,breakdown,natural disasters,governmental or political actions,litigation or arbitrationproceedings,the unavailability of reagents,equipment,operating parts and supplies critical to producti
36、on,labourshortages,labour relations issues,strikes or lockouts,underground floods,cave-ins,ground movements,tailingsdam failure,lack of tailings capacity,transportationdisruptions or accidents,unanticipated consequences of ourcost reduction strategies,or other development or operatingrisks6 CAMECO C
37、ORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS 7 6 CAMECO CORPORATION HIGHLIGHTS DECEMBER 31($MILLIONS EXCEPT WHERE INDICATED)2016 2015 CHANGE Revenue 2,431 2,754(12)%Gross profit 463 697(34)%Net earnings(loss)attributable to equity holders(62)65(195)%$per common share(diluted)(0.16)0.16(194)%Adjust
38、ed net earnings(non-IFRS,see page 24)143 344(58)%$per common share(adjusted and diluted)0.36 0.87(59)%Cash provided by operations(after working capital changes)312 450(31)%Net earnings attributable to equity holders(net earnings)and adjusted net earnings were lower in 2016 compared to 2015.See 2016
39、consolidated financial results beginning on page 23 for more information.Our uranium segment continued to outperform the market In our uranium segment,we exceeded our annual production expectations,and realized a number of successes and new developments at our mining operations.Key highlights:annual
40、 production of 27.0 million pounds5%higher than the guidance provided in our 2016 third quarter MD&Aquarterly production of 7.1 million pounds in the fourth quarter26%lower than in 2015 due to the suspension ofproduction at Rabbit Lake,the curtailment of production at Cameco Resources US operations,
41、and lower production atInkaiexceeded planned production at the Cigar Lake mine and AREVAs McClean Lake millwe signed an agreement with our partner Kazatomprom and JV Inkai to restructure and enhance JV Inkaihigher-cost production was suspended at our Rabbit Lake operation and curtailed at Cameco Res
42、ources US ISRoperations;by the end of August,2016,Rabbit Lake was in a state of safe care and maintenancewe received conditional environmental approval for our Yeelirrie uranium project in Western Australia,and we were granteda 10-year extension of the requirement to provide the government with a de
43、velopment proposalSee Our operations and projects beginning on page 51 for more information.Updates on our other segments and investments Production in 2016 from our fuel services segment was 13%lower than in 2015.We continue to face weak market conditions for conversion services,and we are continui
44、ng to operate Port Hope at a reduced production level.Back to Table of Contents2016 performance highlights Our focus throughout 2016 was to lower our costs and improve efficiency amid difficult uranium market conditions.We continue to anticipate a market shift as demand increases in the form of rest
45、arts and new reactors,while current and future supply decreases through curtailments and lack of investment.However,until we see signs of that shift emerging,we will continue to take the necessary actions intended to preserve shareholder value and position the company for long term success.Financial
46、 performance MANAGEMENTS DISCUSSION AND ANALYSIS 7 HIGHLIGHTS 2016 2015 CHANGE Uranium Production volume(million lbs)27.0 28.4(5)%Sales volume(million lbs)1 31.5 32.4(3)%Average realized price($US/lb)41.12 45.19(9)%($Cdn/lb)54.46 57.58(5)%Revenue($millions)1 1,718 1,866(8)%Gross profit($millions)444
47、 608(27)%Fuel services Production volume(million kgU)8.4 9.7(13)%Sales volume(million kgU)1 12.7 13.6(7)%Average realized price($Cdn/kgU)25.37 23.37 9%Revenue($millions)1 321 319 1%Gross profit($millions)63 61 3%NUKEM Sales volume U3O8(million lbs)1 7.1 10.7(34)%Average realized price($Cdn/lb)47.90
48、48.82(2)%Revenue($millions)1 391 554(29)%Gross profit(loss)($millions)(28)42(167)%1 Includes sales and revenue between our uranium,fuel services and NUKEM segments.Please see 2016 Financial results by segment beginning on page 42.Industry prices In 2016,the uranium spot price ranged from a high of$3
49、5(US)per pound to a low of about$18(US)per pound,averaging around$26(US)for the year.Utilities continue to be well covered under existing contracts,and,given the current uncertainties in the market,we expect they and other market participants will continue to be opportunistic in their buying.As a re
50、sult,contracting is expected to remain somewhat discretionary in 2017.2016 2015 CHANGE Uranium($US/lb U3O8)1 Average annual spot market price 25.64 36.55(30)%Average annual long-term price 39.00 46.29(16)%Fuel services($US/kgU as UF6)1 Average annual spot market price North America 6.40 7.35(13)%Eur
51、ope 6.91 7.85(12)%Average annual long-term price North America 12.58 15.33(18)%Europe 13.56 16.38(17)%Note:the industry does not publish UO2 prices.1 Average of prices reported by TradeTech and Ux Consulting(Ux)8 CAMECO CORPORATION Also of note On January 31,2017,Tokyo Electric Power Company Holding
52、s,Inc.(“TEPCO”)confirmed that it would not accept a uranium delivery scheduled for February 1,2017,and would not withdraw the contract termination notice it provided to Cameco Inc.on January 24,2017 with respect to a uranium supply agreement between TEPCO and Cameco Inc.TEPCO alleged that an event o
53、f“force majeure”has occurred because it has been unable to operate its nuclear reactors for 18 consecutive months due to the Fukushima nuclear accident in March 2011 and the resulting government regulations.Cameco Inc.sees no basis for terminating the agreement and will pursue all its legal rights a
54、nd remedies against TEPCO.Under the agreement,TEPCO has already received and paid for 2.2 million pounds of uranium since 2014.The termination would affect approximately 9.3 million pounds of uranium deliveries through 2028,worth approximately$1.3 billion in revenue to Cameco,including about$126 mil
55、lion in each of 2017,2018 and 2019 based on 855,000 pounds of deliveries in each of those years.All estimates and uranium volumes are provided on a consolidated basis for Cameco using expected contract prices and an exchange rate of$1.00(US)for$1.30(Cdn)and do not reflect any resale of the cancelled
56、 deliveries under the contract with TEPCO.In this MD&A,our 2017 financial outlook and other disclosures relating to our contract portfolio are presented on a basis that excludes this agreement with TEPCO,which is under dispute.SHARES AND STOCK OPTIONS OUTSTANDING At February 7,2017,we had:395,792,52
57、2 common shares and one Class B shareoutstanding7,969,882 stock options outstanding,with exerciseprices ranging from$16.38 to$54.38DIVIDEND Our board of directors has established a quarterly dividend of$0.10($0.40 per year)per common share.The dividend is reviewed quarterly based on our cash flow,ea
58、rnings,financial position,strategy and other relevant factors.MANAGEMENTS DISCUSSION AND ANALYSIS 9 Back to Table of ContentsMarket overview and 2016 developments Cautiously optimistic Todays uranium market is challenging,but we are cautiously optimistic that we are starting to see some of the signp
59、osts required for a market recovery.The future uncovered uranium requirements of utilities due to low levels of long-term contracting over the past four years are increasing.There have been several announcements on both the supply and demand side that are expected to have a positive impact on the ch
60、allenging market,and there is renewed interest in nuclear power and uranium from non-traditional market participants.However,we believe it will ultimately be the return of term contracting in a significant way that will signal that market dynamics have turned more positive.TODAY:A STORY OF OVERSUPPL
61、Y The uranium market continues to be in a state of oversupply.Market recovery has taken longer than anticipated as a result of a slower than expected pace of reactor restarts in Japan,unexpected reactor shutdowns in other regions,delays in reactor construction programs,and reactors under constructio
62、n not yet consuming uranium.At the same time,supply has continued to perform well,adding to the delay in market improvement.On the supply side,secondary supplies,consisting largely of government inventories and enricher underfeeding,continue to provide the industry with an exceptionally low-cost sou
63、rce of uranium supply,where the economics differ considerably from mined production.Similarly,several producers,whose production drivers are not always economic,such as large diversified miners and companies mining uranium for strategic or social purposes,negatively impact the supply-demand balance.
64、The lowest cost tier-one production,including our own assets,continues to perform well,with cash costs that allow them to remain economic,even at current prices.Finally,higher-cost production,though sensitive to the uranium price,continues to be supported by higher prices under long-term contracts a
65、nd/or advantageous foreign exchange rates.The excess supply has impacted the market in a significant way.Abundant spot material has been available to satisfy utilities appetite for low-priced pounds to meet near-to mid-term requirements.As a result,strategic inventories have grown across the industr
66、y and the need to sign significant long-term contracts has been deferred.These industry dynamics make it difficult to predict the timing of a market recovery.However,given that Ux Consulting Company,LLC(UxC)reports that over the last four years only 245 million pounds have been locked-up in the long
67、-term market,while over 635 million pounds have been consumed in reactors,we remain confident that utilities have a growing gap to fill.As annual supply adjusts and utilities uncovered requirements grow,we believe the pounds available in the spot market wont be enough to satisfy the demand.OPPORTUNI
68、TIES FOR THOSE WHO CAN WAIT 10 CAMECO CORPORATION Like other commodities,the uranium industry is cyclical and the low level of contracting at low prices that were seeing today is not new.When prices are low,there is no urgency to contract.The heavy contracting that took place during the previous pri
69、ce run,which drove investment in higher-cost sources of production,contributes to the perception that uranium is abundant and always will be.History demonstrates that the opposite tends to occur when prices rise.After years of low investment in supply,as has been the case so far this decade,security
70、 of supply tends to overtake price concerns at some point,and utilities re-enter the long-term market to ensure they have the reliable supply of uranium they need to run their reactors.The backlog of future contracting needs created by the low-price environment presents a substantial opportunity for
71、 suppliers like us that can weather the low-price part of the cycle.As a low-cost producer,we plan our business with these price cycles in mind.In our industry,customers dont come to the market right before they need to load uranium into their reactors.To operate a reactor that could run for more th
72、an 60 years,natural uranium and the downstream services have to be purchased years in advance,allowing time for a number of processing steps before it arrives at the power plant as a finished fuel bundle.At present,we believe there is a significant amount of uranium that needs to be contracted to ke
73、ep reactors running into the next decade.Estimates by industry consultants show cumulative uncovered requirements to be about 800 million pounds over the next nine years.While uncovered requirements do not ramp up significantly in the near-term,the longer the delay in the recovery of the long-term m
74、arket,the less certainty there is around the availability of future supply to fill growing demand.Ultimately,we expect the current price-sensitive sentiment to give way to increasing concerns about the security of future supply.SUPPLY IS NOT GUARANTEED Economic difficulties are beginning to take a t
75、oll on the supply side.Producers who have been protected from the low market prices under long-term contracts,are beginning to emerge from that protection.As a result,it is not just future supply that is at risk we are seeing evidence that even existing supply is at risk:most recently,Kazatomprom an
76、nounced its intention to reduce 2017 output from Kazakhstan by 10%,citing marketchallenges due to the current oversupply situationPaladin has announced reduced production from their 75%owned Langer Heinrich mine and modification of the mine planto reduce costsin the conversion space,Honeywell is mak
77、ing permanent adjustments to its operation and lowering nameplate capacity oftheir facility from 15 million kgU to 7 million kgU as UF6some enrichers are retiring centrifuge capacity,reducing the excess capacity in the enrichment space that is contributing tobroader oversupply via underfeeding and t
78、ails re-enrichmentwe have suspended and curtailed three operations in addition to taking cost-cutting measures that carry additional supplyriskCoupled with looming uncovered requirements,we expect the risks to future and existing supply could decrease the availability of spot material and increase t
79、he pressure for a return to long-term contracting.MANAGEMENTS DISCUSSION AND ANALYSIS 11 DEMAND SIDE CHALLENGES There was mixed news for the broader nuclear industry in 2016.On a regional demand basis,there were significant positive and negative developments:China struggled with a lower economic gro
80、wth forecast and excess capacity in the energy sector,although the countryremains committed to a fast-paced and growing nuclear power programin Japan,a total of 10 reactors now meet the new regulatory standards;however,the pace of restarts continues to be slowIndia made strides in agreements with we
81、stern nuclear vendors,including engineering and design work,and finalizingcontractual arrangements,but the industry continues to face delays in achieving significant progress in nuclear powerdevelopmentRussia saw domestic challenges due to weaker demand for electricity,but continues to pursue an agg
82、ressive reactor exportstrategyUS operators announced additional early reactor closures,but policy developments in some states targeted support forkeeping at-risk reactors profitableA number of additional reactors remain under threat of early closure subject to political and energy policy supportIt r
83、emains to be seen what impact the new US administration will have on the success of their reactor programin the United Arab Emirates,construction of four units is proceeding smoothly,with the startup of the first unit expected in2017,but continued growth remains uncertainthe United Kingdom approved
84、construction of Hinkley Point C,but the rest of Europe is expecting little to no growth innuclear power in the next 10 yearsadvances were also made in the potential growth of some other existing nuclear programs(South Korea,South Africa)andnew nuclear programs(Bangladesh),while steps in the opposite
85、 direction occurred in other jurisdictions(Vietnam andTaiwan)in Canada,the Province of Ontario has shown a strong commitment to nuclear power for nearly 50 years,but continuedsupport is subject to a successful refurbishment programseveral units in Frances nuclear fleet were taken offline due to regu
86、latory reviews linked to technical issues,though somehave been cleared for restart.France is also showing signs of reversing a previously announced intention to reducereliance on nuclear power.While 2016 offered some welcome progress in bringing supply and demand closer to equilibrium,uncertainty pe
87、rsists.WHAT HAS TO CHANGE?Ultimately,the industry needs to fill the demand gap left by forced and premature shut-downs since March of 2011 by continuing to safely bring reactors online.This means Japanese restarts,successful commissioning of new reactors under construction,and continued development
88、of new construction plans.And were seeing positive progress on all fronts:Japanese utilities have now successfully navigated through the new,rigorous safety inspection process58 reactors are currently under construction around the world,the majority of which are expected to come online in the nextth
89、ree years12 CAMECO CORPORATION the growth in nuclear power generation is real,with 10 new reactors connected to the grid in 2016Global population is on the rise,and with the worlds need for safe,clean,reliable baseload energy,nuclear remains an important part of the mix.We remain confident in the fu
90、ture of the nuclear industry,while at the same time recognizing that uncertainty persists.With demand coming on in the form of restarts and new reactors,and supply falling on curtailments and lack of investment,were continuing to expect a market shift.Until that time,we will continue to take the act
91、ions we believe are necessary to position the company for long-term success.Therefore,we will undertake contracting activity which aligns with the uncertain timing of a market recovery intended to ensure we have adequate protection under our contract portfolio,while maintaining exposure to the rewar
92、ds that come from having uncommitted,low-cost supply to deliver into a strengthening market.MANAGEMENTS DISCUSSION AND ANALYSIS 13 Our strategy Tier-one focus Our strategy is set within the context of a challenging market environment,which we expect to give way to strong long-term fundamentals drive
93、n by increasing population and electricity demand.We are a pure-play nuclear fuel supplier,focused on taking advantage of the long-term growth we see coming in our industry,while maintaining the ability to respond to market conditions as they evolve.Our strategy is to focus on our tier-one assets an
94、d profitably produce at a pace aligned with market signals in order to increase long-term shareholder value,and to do that with an emphasis on safety,people and the environment.URANIUM Uranium production is central to our strategy,as it is the biggest value driver of the nuclear fuel cycle and our b
95、usiness.We plan to focus on our tier-one assets and manage our supply according to market conditions in order to return the best value possible.During a prolonged period of uncertainty,our tier-one strategy helps to mitigate risk.As conditions improve,we expect to meet rising demand with production
96、from our best margin operations.In light of todays oversupplied market and the lingering uncertainty as to how long the weak market conditions will persist,we are focussing our resources on our lowest cost assets,on maintaining a strong balance sheet,and on efficiently managing the company in a low
97、price environment.Consistent with this strategy,in 2016,we suspended production at our Rabbit Lake operation in northern Saskatchewan,we curtailed production at Cameco Resources US operations by deferring wellfield development,and we reduced the workforce in our corporate office.In addition,actions
98、we have planned for 2017,including a 10%reduction of the workforce at our McArthur River,Key Lake and Cigar Lake operations,changes to work rotation schedules,and changes to the commuter flight services at our sites,are all expected to further reduce costs and improve efficiency at our mining operat
99、ions.See Uranium production overview on page 55 for additional details FUEL SERVICES Our fuel services division is a source of profit and supports our uranium segment while allowing us to vertically integrate across the fuel cycle.Our focus is on maintaining and optimizing profitability.ENRICHMENT W
100、e continue to explore opportunities in the second largest value driver of the fuel cycle.Having operational control of both uranium production and enrichment facilities would offer operational synergies that could enhance profit margins.NUKEM NUKEMs activities provide a source of profit and give us
101、insight into market dynamics.Capital allocation focus on value Delivering returns to our long-term shareholders is a top priority.We continually evaluate our investment options to ensure we allocate our capital in a way that we believe will:create the greatest long-term value for our shareholdersall
102、ow us to maintain our investment grade ratingensure we execute on our dividendTo deliver value,free cash flow must be productively reinvested in the business or returned to shareholders,which requires good execution and disciplined allocation.We have a multidisciplinary capital allocation team that
103、evaluates all possible uses of investable capital.We start by determining how much cash we have to invest(investable capital),which is based on our expected cash flow from operations minus expenses we consider to be a higher priority,such as dividends and financing costs,and could include others.Thi
104、s investable capital can be reinvested in the company or returned to shareholders.Amid the uncertain times we are facing today,the objective of our strategy is to maximize cash flow,while maintaining our investment grade rating through close management of our balance sheet metrics,allowing us to sel
105、f-manage risks.Risks like:a market that remains low for longerlitigation risk related to the CRA and TEPCO disputesrefinancing risk Back to Table of Contents14 CAMECO CORPORATION With the metrics that inform that rating in mind,we have taken steps to improve margin and cash flow by focusing on our t
106、ier-one assets,and reduce operating,capital,and general and administrative spend in this time of low uranium prices.REINVESTMENT Before investable capital is reinvested in sustaining,capacity replacement,or growth,all opportunities are ranked and only those that meet the required risk-adjusted retur
107、n criteria are considered for investment.We also must identify,at the corporate level,the expected impact on cash flow,earnings,and the balance sheet.All project risks must be identified,including the risks of not investing.Allocation of capital only occurs once an investment has cleared these hurdl
108、es.This may result in some opportunities being held back in favour of higher return investments,and should allow us to generate the best return on investment decisions when faced with multiple prospects,while also controlling our costs.If there are not enough good growth prospects internally or exte
109、rnally,this may result in residual investable capital,which we would then consider returning directly to shareholders.RETURN If we determine the best use of cash is to return it to shareholders,we can do that through a share repurchase or dividendeither a one-time special dividend or a dividend grow
110、th policy.When deciding between these options,we consider a number of factors,including generation of excess cash,growth prospects for the company,growth prospects for the industry,and the nature of the excess cash.Share buyback:If we were generating excess cash while there were little or no growth
111、prospects for the company or the industry,then a share buyback might make sense.However,our current view is that the long-term fundamentals for Cameco and the industry remain strong.Dividend:We view our dividend as a priority.It is evaluated by our board of directors on a quarterly basis with carefu
112、l consideration of long-term sustainability.A re-assessment of our current dividend would require a significant fact change at the industry or company level.Marketing strategy balanced contract portfolio As with our corporate strategy and approach to capital allocation,the purpose of our marketing s
113、trategy is to deliver value.Our approach is to secure a solid base of earnings and cash flow by maintaining a balanced contract portfolio that optimizes our realized price.Uranium is not traded in meaningful quantities on a commodity exchange.Utilities have historically bought the majority of their
114、uranium and fuel services products under long-term contracts with suppliers,and have met the rest of their needs on the spot market.We sell uranium and fuel services directly to nuclear utilities around the world as uranium concentrates,UO2 and UF6,conversion services,or fuel fabrication.We have a s
115、olid portfolio of long-term sales contracts that reflect the long-term,trusting relationships we have with our customers.In addition,we are active in the spot market,buying and selling uranium when it is beneficial for us.Our NUKEM business segment enhances our ability to participate,as they are one
116、 of the worlds leading traders of uranium and uranium-related products.We undertake activity in the spot market prudently,looking at the spot price and other business factors to decide whether it is appropriate to purchase or sell into the spot market.Not only is this activity a source of profit,it
117、gives us insight into underlying market fundamentals.LONG-TERM CONTRACTING We deliver large volumes of uranium every year,therefore our net earnings and operating cash flows are affected by changes in the uranium price.Market prices are influenced by the fundamentals of supply and demand,geopolitica
118、l events,disruptions in planned supply and demand,and other market factors.The objective of our contracting strategy is to:maximize realized price while reducing volatility of our future earnings and cash flowfocus on meeting the nuclear industrys growing uncovered requirements with our future uncom
119、mitted supply while ensuringadequate regional diversityestablish and grow market share with strategic customersMANAGEMENTS DISCUSSION AND ANALYSIS 15 We target a ratio of 40%fixed-pricing and 60%market-related pricing in our portfolio of long-term contracts,including mechanisms to protect us when th
120、e market price is declining and allow us to benefit when market prices go up.This is a balanced and flexible approach that allows us to adapt to market conditions and put a floor on our average realized price,and deliver the best value to shareholders over the long term.This strategy has allowed us
121、to realize prices higher than the market prices during periods of weak uranium demand,and we expect it will enable us to realize increases linked to higher market prices in the future.Fixed-price contracts:are typically based on the industry long-term price indicator at the time the contract is acce
122、pted and escalated over the term of the contract.Market-related contracts:are different from fixed-price contracts in that they may be based on either the spot price or the long-term price,and that price is as quoted at the time of delivery rather than at the time the contract is accepted.These cont
123、racts sometimes provide for discounts,and often include floor prices and/or ceiling prices,all of which are escalated over the term of the contract.Fuel services contracts:the majority of our fuel services contracts are at a fixed price per kgU,escalated over the term of the contract,and reflect the
124、 market at the time the contract is accepted.OPTIMIZING THE CONTRACT PORTFOLIO In todays weak market environment,we have been working with certain customers to optimize the value of our existing contract portfolio.In cases where a customer is seeking relief due to a challenging policy,operating,or e
125、conomic environment,we evaluate their specific circumstances and assess their long-term sustainability.Where we deem the customers long-term demand to be at risk,we may consider options that allow us to benefit from converting that uncertain future value into certain present value.In contrast,where
126、the customer is considered to have a more certain and predictable future,we may offer relief,for example by blending in more market-related volumes in the near term,but only where the customer is willing to extend the terms and conditions of that contract out into the future,and only where it is ben
127、eficial to us.CUSTOMERS FUTURE OPERATING ENVIRONMENT UNCERTAIN OPTIMISTIC Changing Policy Clear pathways Challenges Regulatory Established Unregulated Economic Benefits recognized Future uncertainty for present certain value Resulting trade-off considerations Relief where it is beneficial for us CON
128、TRACT PORTFOLIO STATUS Currently,our production is heavily committed under long-term uranium contracts through 2019,so we are being selective when considering new commitments and working to achieve our contracting objectives.We have commitments to sell approximately 150 million pounds of U3O8 with 4
129、0 customers worldwide in our uranium segment,and over 50 million kilograms as UF6 conversion with 31 customers worldwide in our fuel services segment.Customers U3O8:Five largest customers account for 52%of commitments COMMITTED U3O8 SALES BY REGION Americas 36%Asia 44%Europe 20%16 CAMECO CORPORATION
130、 Customers UF6 conversion:Five largest customers account for 56%of commitments COMMITTED UF6 SALES BY REGION MANAGING OUR CONTRACT COMMITMENTS To meet our delivery commitments,we use our uranium supply,which includes uranium obtained from:our existing productionpurchases under long-term agreements a
131、nd in the spot marketour existing inventoryWe allow sales volumes to vary year-to-year depending on:the level of sales commitments in our long-term contract portfolio(the annual average sales commitments over the next fiveyears in our uranium segment is 24 million pounds,with commitment levels throu
132、gh 2019 higher than in 2020 and 2021)our production volumespurchases under existing and/or new arrangementsdiscretionary use of inventoriesmarket opportunitiesFocusing on cost efficiency PRODUCTION COSTS In order to operate efficiently and cost-effectively,we manage operating costs and improve plant
133、 reliability by prudently investing in production infrastructure,new technology,and business process improvements.Like all mining companies,our uranium segment is affected by the cost of inputs such as labour and fuel.2016 URANIUM OPERATING COSTS BY CATEGORYOperating costs in our fuel services segme
134、nt are mainly fixed.In 2016,labour accounted for about 52%of the total.The largest variable operating cost is for zirconium,followed by energy(natural gas and electricity),maintenance supplies,and anhydrous hydrogen fluoride.Americas 33%Asia 29%Europe 38%UtilitesandcampcostsAirchartersMining&mainten
135、ancecontractorsSecurity&groundfreightContracted servicesLabour36%ReagentsFuelsOtheritemsProduction supplies 22%42%MANAGEMENTS DISCUSSION AND ANALYSIS 17 PURCHASES AND INVENTORY COSTS Our costs are also affected by the purchases of uranium and conversion services we make under long-term contracts and
136、 on the spot market.To meet our delivery commitments,we make use of our mined production and inventories,and we purchase material where it is beneficial to do so.The cost of purchased material may be higher or lower than our other sources of supply,depending on market conditions.The cost of purchase
137、d material affects our cost of sales,which is determined by calculating the average of all of our sources of supply,including opening inventory,production,and purchases.FINANCIAL IMPACT As greater certainty returns to the uranium market,based on our view that the market will transition from being su
138、pply-driven to being demand-driven,we expect uranium prices will rise to reflect the cost of bringing on new primary production to meet growing demand.In addition,as we execute our strategy to focus on tier-one production,we expect to see more stability in the unit cost of sales for our uranium segm
139、ent.Sustainable development:A key part of our strategy Social responsibility and environmental protection are top priorities for us,so much so that we have built our corporate objectives around them within our four measures of success:a safe,healthy and rewarding workplace,a clean environment,suppor
140、tive communities,and outstanding financial performance.For us,sustainability isnt an add-on for our company;its at the core of our company culture.It helps us:build trust,credibility and corporate reputationgain and enhance community support for our operations and plansattract and retain employeesma
141、nage riskdrive innovation and continual improvement to build competitive advantageBecause they are so important,we integrate sustainable development principles and practices at each level of our organization,from our overall corporate strategy to individual employee practice in day-to-day operations
142、.Consequently,we recognize that changes in our operations and support functions,including the suspension of production at Rabbit Lake,curtailment at Cameco Resources US operations,and the reduction of the workforce at our northern Saskatchewan operations and at our corporate office,all have a signif
143、icant impact on the communities where we operate.While we regret the negative impact that these carefully deliberated decisions have on affected employees and other stakeholders,these actions are deemed necessary for the long-term health of the company in a uranium market that continues to be weak a
144、nd oversupplied.Improving operational efficiency is part of our strategy to effectively manage costs and remain competitive through these low times,while positioning the company and our stakeholders to benefit as the market improves.SAFE,HEALTHY,REWARDING WORKPLACE We are committed to living a stron
145、g safety culture,while looking to continually improve.As a result of this commitment,we have a long history of strong safety performance at our operations and across the organization.2016 Highlights:several operations reached significant safety milestones,including the Blind River refinery and the C
146、row Butte operationpassing 10 and 9 years respectively,without a lost time incidentcontinued low average dose of radiation to workers while ramping up Cigar Lakeawarded the John T Ryan National Safety award at McArthur River mine based on prior year performance for the third yearin a rowrecognized f
147、or several top employer awardsA CLEAN ENVIRONMENT We are committed to being a leading environmental performer.We strive to be a leader not only by complying with legal requirements,but also by keeping risks as low as reasonably achievable,and looking for opportunities to move beyond requirements.We
148、track our progress by monitoring the air,water and land near our operations,and by measuring the amount of energy we use and the amount of waste generated.We use this information to help identify opportunities to improve.2016 Highlights:sustained the significantly reduced uranium-to-air emissions ac
149、hieved at our Port Hope conversion facility in 2014continued to reduce low level radioactive waste stored at our Fuel Services division facilitiesimproved effluent performance at the McArthur River minesuccessfully transitioned the Rabbit Lake operation into care and maintenance with no significant
150、environmental incidentcontinued to carry out industry leading research and innovation in groundwater restoration at our US in situ recoveryoperationsSUPPORTIVE COMMUNITIES Gaining the trust and support of our communities,indigenous people,and governments is necessary to sustain our business.We earn
151、support and trust through excellent safety and environmental performance,by proactively engaging our stakeholders in an open and transparent way,and by making a difference in communities wherever we operate.These efforts are critical to obtaining and maintaining the necessary regulatory approvals.20
152、16 Highlights:over$210 million in procurement from locally owned northern Saskatchewan companies(80%of total)1,088 local personnel from northern Saskatchewan(704 Cameco employees,384 contractors)signed a Collaboration Agreement,our third in the region,with the seven communities of the Athabasca,incl
153、uding threeFirst Nationscommunity engagement activities at all of our operationscontinued work on groundwater restoration with five universities,Los Alamos National Laboratory,and the United StatesGeological SurveyOUTSTANDING FINANCIAL PERFORMANCE Long-term financial stability and profitability are
154、essential to our sustainability as a company.We firmly believe that sound governance is the foundation for strong corporate performance.2016 Highlights:continue to achieve an average realized price that outperforms the marketranked 23rd out of 231 Canadian companies by Globe and Mail in governance p
155、racticesMONITORING AND MEASUREMENT We take the integration of sustainable development and measurement of our performance seriously.We have been producing a Sustainable Development(SD)Report since 2005,using the Global Reporting Initiatives Sustainability Framework(GRI).It is our report card to our s
156、takeholders.It tells them how were performing against globally recognized key indicators that measure our social,environmental and economic impacts in the areas that matter most to them.It provides information about our goals,where weve met,exceeded or struggled with them,and how we plan to do bette
157、r.Our most recent SD Report was released in August,2016 and we expect to release our next full report in 2018.All of our operating sites are ISO 14001 compliant.In addition,we have now transitioned from individual site-based ISO 14001 certifications to a single corporate certification.We have begun
158、to roll our operations into this single certification.Achievements We are a five-time Gold award winner through the Progressive Aboriginal Relations program as judged by the Canadian Council for Aboriginal Business.We are also proud to have been named one of Canadas Top 100 Employers,Saskatchewans T
159、op Employers,and Canadas Best Diversity Employers for eight years running,and one of Canadas Top Employers for Young People for the seventh year.We are a leading employer of indigenous peoples in Canada,and have procured nearly$3.5 billion in services from local suppliers in northern Saskatchewan si
160、nce 2004.We encourage you to review our SD report at which outlines our commitment to people and the environment in more detail.18 CAMECO CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS 21 20 CAMECO CORPORATION Measuring our results Each year,we set corporate objectives that are aligned with our str
161、ategic plan.These objectives fall under our four measures of success,and performance against specific targets under these objectives forms the foundation for a portion of annual employee and executive compensation.See our most recent management proxy circular for more information on how executive co
162、mpensation is determined.2016 OBJECTIVES1 TARGET RESULTS OUTSTANDING FINANCIAL PERFORMANCE Earnings measures Achieve targeted adjusted net earnings and cash flow from operations(before working capital changes).Did not achieve adjusted net earnings was below the minimum target cash flow from operatio
163、ns was below the minimumtargetCapital management measures Execute capital projects within the approved scope,cost and schedule.Achieved cost performance was under budget(better than thetarget)project milestones were achieved largely onscheduleCigar Lake measure Average daily production rate.Exceeded
164、 the average daily production rate mined from CigarLake in 2016 was higher than the targetSAFE,HEALTHY AND REWARDING WORKPLACE Workplace safety measures Strive for no injuries at all Cameco-operated sites.Maintain a long-term downward trend in combined employee and contractor injury frequency and se
165、verity,and radiation doses.Partially Achieved injury rates were stable but did not meet one of thetwo planned reduction targets for the year average radiation doses remained low and stableRewarding workplace measures Attract and retain the employees needed to support operations.Partially achieved di
166、versity and inclusion strategy developmentmilestones were achieved on schedule turnover rate for new hires during the first year ofemployment was higher than the target(higherturnover)CLEAN ENVIRONMENT Environmental performance measures Achieve divisional environmental aspect improvement targets.Ach
167、ieved performance was within the targeted range there were no significant environmental incidents in2016SUPPORTIVE COMMUNITIES Stakeholder support measures Implement Collaboration Agreements by supporting northern business development opportunities and build corporate reputation.Exceeded sourcing of
168、 northern services from NorthernSaskatchewan vendors was above the target sourcing of capital projects construction servicesfrom Northern Saskatchewan vendors was above thetarget public support index scoring was slightly above ourtarget1 Detailed results for our 2016 corporate objectives and the rel
169、ated targets will be provided in our 2017 management proxy circular prior to our Annual Meeting of Shareholders on May 11,2017.Back to Table of ContentsMANAGEMENTS DISCUSSION AND ANALYSIS 21 2017 objectives OUTSTANDING FINANCIAL PERFORMANCE Achieve targeted adjusted net earnings and cash flow from o
170、perations.SAFE,HEALTHY AND REWARDING WORKPLACE Improve workplace safety performance at all sites.CLEAN ENVIRONMENT Improve environmental performance at all sites.SUPPORTIVE COMMUNITIES Build and sustain strong stakeholder support for our activities.22 CAMECO CORPORATION Financial results This sectio
171、n of our MD&A discusses our performance,financial condition and outlook for the future.23 2016 CONSOLIDATED FINANCIAL RESULTS 34 OUTLOOK FOR 2017 36 LIQUIDITY AND CAPITAL RESOURCES 42 2016 FINANCIAL RESULTS BY SEGMENT 42.URANIUM 44.FUEL SERVICES 44.NUKEM 46 FOURTH QUARTER FINANCIAL RESULTS 46.CONSOL
172、IDATED RESULTS 48.URANIUM 50.FUEL SERVICES 50.NUKEM Back to Table of ContentsMANAGEMENTS DISCUSSION AND ANALYSIS 232016 consolidated financial results On February 1,2017,we announced that on January 31,2017,TEPCO,alleging force majeure,confirmed that it would not withdraw a contract termination noti
173、ce it provided to Cameco Inc.with respect to a uranium supply agreement,which affects approximately 9.3 million pounds of uranium deliveries through 2028,worth approximately$1.3 billion in revenue to Cameco,including about$126 million in 2017.We see no basis for terminating the agreement.In this MD&
174、A,our 2017 financial outlook and other disclosures relating to our contract portfolio are presented on a basis which excludes this agreement with TEPCO,which is under dispute.HIGHLIGHTS CHANGE FROM DECEMBER 31($MILLIONS EXCEPT WHERE INDICATED)2016 2015 20141 2015 TO 2016 Revenue 2,431 2,754 2,398(12
175、)%Gross profit 463 697 638(34)%Net earnings(loss)attributable to equity holders(62)65 185(195)%$per common share(basic)(0.16)0.16 0.47(194)%$per common share(diluted)(0.16)0.16 0.47(194)%Adjusted net earnings(non-IFRS,see page 24)143 344 412(58)%$per common share(adjusted and diluted)0.36 0.87 1.04(
176、59)%Cash provided by operations(after working capital changes)312 450 480(31)%1 On January 31,2014,we announced the sale of our 31.6%limited partnership interest in Bruce Power Limited Partnership(BPLP)and related entities for$450 million.The sale closed on March 27,2014,and was accounted for as bei
177、ng completed effective January 1,2014.Net earnings Our net loss attributable to equity holders(net loss)in 2016 was$62 million($0.16 per share diluted)compared to earnings of$65 million($0.16 per share diluted)in 2015,mainly due to:lower gross profit from our uranium and NUKEM segmentshigher adminis
178、tration costshigher impairment charges($362 million in 2016;$215 million in 2015)higher loss on disposal of assetshigher foreign exchange losses compared to gains in 2015lower tax recovery.See Income taxes on page 28 for details.partially offset by:higher gross profit from our fuel services segmentg
179、ain from remeasurement of Rabbit Lake reclamation obligationmark-to-market gains on foreign exchange derivatives compared to losses in 2015.See Foreign exchange on pages 32 and33 for details.gain from termination of long-term contractsTHREE-YEAR TREND Our net earnings normally trend with revenue,but
180、,in recent years,have been significantly influenced by unusual items.In 2015,our net earnings were$120 million lower than in 2014 primarily due to:higher administration costshigher losses on foreign exchange derivatives due to the weakening of the Canadian dollar.See Foreign exchange onpages 32 and
181、33 for details.lower income tax recoverypartially offset by:higher earnings from all segmentsa decrease in impairment charges($215 million in 2015;$327 million in 2014)a reduction the provision related to our CRA litigation Back to section Table of Contents24 CAMECO CORPORATION In addition,in 2014 t
182、here were a number of one-time items that contributed to the higher net earnings in 2014 compared to 2015,including:a$127 million gain on the sale of our interest in BPLP in 2014a favourable settlement of$66 million in 2014 in a dispute regarding a long-term supply contract with a utility customerpa
183、rtially offset by:payment of an early termination fee of$18 million incurred as a result of our toll conversion agreement with SpringfieldsFuels Limited(SFL),and settlement costs of$12 million with respect to early termination of our Series C debenturesthe write-off of$41 million of assets under con
184、struction in 2014 as a result of changes made to the scope of a number ofprojectsImpairment charges Production was suspended at our Rabbit Lake operation in the second quarter and as a result,we recognized an impairment charge for the full carrying value of$124 million during the second quarter.Duri
185、ng the fourth quarter of 2016,we recorded a$238 million write-down of the full carrying value of our interest in Kintyre,our uranium exploration project in Australia.Due to the weakening of the uranium market since the asset was purchased in 2008,and the budget decision not to allocate any further s
186、pend to the project,we concluded it was appropriate to recognize a further impairment charge for this asset.See note 8 to the financial statements.Non-IFRS measures ADJUSTED NET EARNINGS Adjusted net earnings is a measure that does not have a standardized meaning or a consistent basis of calculation
187、 under IFRS(non-IFRS measure).We use this measure as a more meaningful way to compare our financial performance from period to period.We believe that,in addition to conventional measures prepared in accordance with IFRS,certain investors use this information to evaluate our performance.Adjusted net
188、earnings is our net earnings attributable to equity holders,adjusted to better reflect the underlying financial performance for the reporting period.The adjusted earnings measure reflects the matching of the net benefits of our hedging program with the inflows of foreign currencies in the applicable
189、 reporting period,and is adjusted for impairment charges,the write-off of assets,NUKEM purchase price inventory recovery,Rabbit Lake reclamation provision adjustment,gain on interest in BPLP(after tax),and income taxes on adjustments.Adjusted net earnings is non-standard supplemental information and
190、 should not be considered in isolation or as a substitute for financial information prepared according to accounting standards.Other companies may calculate this measure differently,so you may not be able to make a direct comparison to similar measures presented by other companies.To facilitate a be
191、tter understanding of these measures,the table below reconciles adjusted net earnings with our net earnings for the years ended 2016,2015 and 2014.($MILLIONS)2016 2015 2014 Net earnings(loss)attributable to equity holders(62)65185Adjustments Adjustments on derivatives(130)16647NUKEM purchase price i
192、nventory recovery(6)(3)(5)Impairment charges 362 215327Write-off of assets-41Rabbit Lake reclamation provision adjustment(34)-Income taxes on adjustments 13(99)(56)Gain on interest in BPLP(after tax)-(127)Adjusted net earnings 143 344412MANAGEMENTS DISCUSSION AND ANALYSIS 25 The following table show
193、s what contributed to the change in adjusted net earnings for 2016.($MILLIONS)Adjusted net earnings 2015 344 Change in gross profit by segment(we calculate gross profit by deducting from revenue the cost of products and services sold,and depreciation and amortization(D&A),net of hedging benefits)Ura
194、nium Lower sales volume(16)Lower realized prices($US)(129)Foreign exchange impact on realized prices 30 Higher costs(49)change uranium(164)Fuel services Lower sales volume(4)Higher realized prices($Cdn)25 Higher costs(19)change fuel services 2 NUKEM Gross profit(71)change NUKEM(71)Other changes High
195、er administration expenditures(20)Higher exploration expenditures(2)Higher loss on disposal of assets(21)Lower loss on derivatives 19 Higher foreign exchange losses(65)Gain on customer contract settlements 59 Higher income tax recovery 63 Other(1)Adjusted net earnings 2016 143 THREE-YEAR TREND Our a
196、djusted net earnings decreased from 2014 to 2015,and decreased again from 2015 to 2016.The 17%decrease from 2014 to 2015 resulted from:greater losses on foreign exchange derivatives due to the weakening of the Canadian dollar,see Foreign exchange onpage 32 for more informationlower tax recoveries,pr
197、imarily due to the write-off of our deferred tax asset in the US.See Income taxes on page 28 fordetails.partially offset by:higher earnings in our uranium and fuel services segments mainly due to a higher average realized pricehigher earnings from our NUKEM segment mainly due to higher sales volumes
198、 and a higher average realized pricea reduction of the provision related to our CRA litigation,see Income taxes on page 28 for detailsIn addition,in 2014 there was a favourable settlement of$66 million with respect to a dispute regarding a long-term supply contract with a utility customer that contr
199、ibuted to the higher adjusted net earnings in 2014 compared to 2015.The impact of the settlement was partially offset by an early termination fee of$18 million incurred as a result of the cancellation of our toll conversion agreement with SFL and settlement costs of$12 million with respect to the ea
200、rly redemption of our Series C debentures in 2014.The 58%decrease from 2015 to 2016 resulted from:lower gross profit from our uranium and NUKEM segmentshigher administration costshigher loss on disposal of assetshigher foreign exchange losses compared to gains in 2015partially offset by:higher gross
201、 profit from our fuel services segmentlower losses on foreign exchange derivatives.See Foreign exchange on page 32 for details.gain from termination of long-term contractshigher tax recovery.See Income taxes on page 28 for details.Average realized prices CHANGE FROM 2016 2015 2014 2015 TO 2016 Urani
202、um1$US/lb41.12 45.1947.53(9)%$Cdn/lb54.46 57.5852.37(5)%Fuel services$Cdn/kgU 25.37 23.3719.709%NUKEM$Cdn/lb47.90 48.8244.90(2)%1 Average realized foreign exchange rate($US/$Cdn):2016 1.32,2015 1.27 and 2014 1.10.Revenue The following table shows what contributed to the change in revenue for 2016.($
203、MILLIONS)Revenue 2015 2,754 Uranium Lower sales volume(50)Lower realized prices($Cdn)(98)Change in intersegment sales 1 Fuel services Lower sales volume(23)Higher realized prices($Cdn)25 Change in intersegment sales(1)NUKEM Change in revenue(162)Change in intersegment sales 23 Other(38)Revenue 2016
204、2,431 See 2016 Financial results by segment on page 42 for more detailed discussion.THREE-YEAR TREND In 2015,revenue increased by 15%compared to 2014 due to significant weakening of the Canadian dollar during the year,which resulted in record annual consolidated revenue and record annual revenue for
205、 our uranium segment.The realized foreign exchange rate was 1.27 compared to 1.10 in 2014.In addition,we had higher revenues in our NUKEM segment as a result of higher sales volumes,which were driven by increased market activity.In 2016,revenue decreased by 12%compared to 2015 due to lower sales rev
206、enues in all of our operating segments as a result of reduced sales volumes in response to market conditions.In addition,we had lower revenues in our uranium and NUKEM segments as a result of the lower US dollar average realized price which was due to lower prices on market-related contracts.This wa
207、s partially offset by further weakening of the Canadian dollar exchange rate realized on sales during 2016.The realized foreign exchange rate was 1.32 compared to 1.27 in 2015.Revenue Outlook for 2017 We expect consolidated revenue to decrease in 2017(outlook of$1,950 million to$2,080 million),based
208、 on currently committed sales volumes,due to a decrease in average realized prices in our uranium segment as a result of lower prices under both fixed and market related contracts,TEPCO contract dispute,and an expected decrease in NUKEM sales volumes.If we make additional sales with deliveries in 20
209、17,we would expect our revenue outlook to increase.26 CAMECO CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS 27 In our uranium and fuel services segments,our customers choose when in the year to receive deliveries.As a result,our quarterly delivery patterns and,therefore,our sales volumes and revenu
210、e can vary significantly.We expect the quarterly distribution of uranium deliveries in 2017 to be weighted to the second half of the year as shown below.However,not all delivery notices have been received to date and the expected delivery pattern could change.Typically,we receive notices six months
211、in advance of the requested delivery date.Corporate expenses ADMINISTRATION($MILLIONS)2016 2015 CHANGE Direct administration 195 173 13%Stock-based compensation 12 14(14)%Total administration 207 187 11%Direct administration costs in 2016 were$22 million higher than in 2015 due mainly to:one-time co
212、sts related to collaboration agreementscharges related to the consolidation of office spacelegal costs as we prepared the CRA case for trial,which began in October,2016restructuring of our NUKEM segment,andcosts related to our reduction of staffing levels at our corporate officeWe recorded$12 millio
213、n in stock-based compensation expenses in 2016 under our stock option,restricted share unit,deferred share unit,performance share unit and phantom stock option plans,compared to$14 million in 2015.See note 23 to the financial statements.Administration outlook for 2017 We expect administration costs(
214、not including stock-based compensation)to be approximately 20%lower compared to 2016(outlook between$150 million to$160 million)due to the actions that we took during 2016 to reduce costs.EXPLORATION Our 2016 exploration activities remained focused on Canada and Australia.Our spend increased from$40
215、 million in 2015 to$43 million in 2016.Exploration outlook for 2017 We expect exploration expenses to be about$30 million in 2017 due to an overall decrease in activity on our regional exploration projects.FINANCE COSTS Finance costs were$112 million compared to$104 million in 2015.The increase from
216、 last year was mainly a result of increased letter of credit fees.See note 18 to the financial statements.FINANCE INCOME Finance income was$4 million compared to$5 million in 2015,reflecting lower average cash balances in 2016.GAINS AND LOSSES ON DERIVATIVES In 2016,we recorded$34 million in gains o
217、n our derivatives compared to losses of$281 million in 2015.The gains reflect the strengthening of the Canadian dollar compared to the US dollar from the exchange rate at the end of 2015.See Foreign exchange on page 32 and note 25 to the financial statements.INCOME TAXES We recorded an income tax re
218、covery of$94 million in 2016 compared to a recovery of$143 million in 2015.The decrease in recovery was primarily due to the change in the distribution of earnings between jurisdictions compared to 2015.In addition,in 2015,the tax recovery included a$73 million write-off of our deferred tax asset in
219、 the US,partially offset by a$42 million reduction in the provision related to the CRA litigation.See note 20 to the financial statements.In 2016,we recorded losses of$464 million in Canada compared to$960 million in 2015,while earnings in foreign jurisdictions decreased to$310 million from$880 mill
220、ion.The tax rate in Canada is higher than the average of the rates in the foreign jurisdictions in which our subsidiaries operate.On an adjusted earnings basis,we recognized a tax recovery of$107 million in 2016 compared to a recovery of$44 million in 2015.Our effective tax rate was a recovery of 28
221、2%in 2016,compared to a recovery of 15%in 2015.The table below presents our adjusted earnings and adjusted income tax expenses attributable to Canadian and foreign jurisdictions.($MILLIONS)2016 2015 Pre-tax adjusted earnings1 Canada(504)(578)Foreign 542 877 Total pre-tax adjusted earnings 38 299 Adj
222、usted income taxes1 Canada(128)(177)Foreign 21 133 Adjusted income tax recovery(107)(44)Effective tax rate(%)(282)%(15)%1 Pre-tax adjusted earnings and adjusted income taxes are non-IFRS measures.Our IFRS-based measures have been adjusted by the amounts reflected in the table in adjusted net earning
223、s(non-IFRS measures on page 24).TRANSFER PRICING DISPUTES We have been reporting on our transfer pricing disputes with CRA since 2008,when it originated,and with the United States Internal Revenue Service(IRS)since the first quarter of 2015.Below,we discuss the general nature of transfer pricing dis
224、putes and,more specifically,the ongoing disputes we have.Transfer pricing is a complex area of tax law,and it is difficult to predict the outcome of cases like ours.However,tax authorities generally test two things:the governance(structure)of the corporate entities involved in the transactions the p
225、rice at which goods and services are sold by one member of a corporate group to anotherWe have a global customer base and we established a marketing and trading structure involving foreign subsidiaries,including Cameco Europe Limited(CEL),which entered into various intercompany arrangements,includin
226、g purchase and sale agreements,as well as uranium purchase and sale agreements with third parties.Cameco and its subsidiaries made reasonable efforts to put arms-length transfer pricing arrangements in place,and these arrangements expose the parties to the risks and rewards accruing to them under th
227、ese contracts.The intercompany contract prices are generally comparable to those established in comparable contracts between arms-length parties entered into at that time.28 CAMECO CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS 29 For the years 2003 to 2011,CRA has shifted CELs income(as recalculat
228、ed by CRA)back to Canada and applied statutory tax rates,interest and instalment penalties,and,from 2007 to 2010,transfer pricing penalties.There has not yet been a decision regarding a transfer pricing penalty for 2011.The IRS is also proposing to allocate a portion of CELs income for the years 200
229、9 through 2012 to the US,resulting in such income being taxed in multiple jurisdictions.Taxes of approximately$350 million for the 2003 2016 years have already been paid in a jurisdiction outside Canada and the US.Bilateral international tax treaties contain provisions that generally seek to prevent
230、 taxation of the same income in both countries.As such,in connection with these disputes,we are considering our options,including remedies under international tax treaties that would limit double taxation;however,there is a risk that we will not be successful in eliminating all potential double taxa
231、tion.The expected income adjustments under our tax disputes are represented by the amounts claimed by CRA and IRS and are described below.CRA dispute Since 2008,CRA has disputed our corporate structure and the related transfer pricing methodology we used for certain intercompany uranium sale and pur
232、chase agreements.To the end of 2015,we received notices of reassessment for our 2003 through 2010 tax returns,and,in the fourth quarter of 2016,we received a notice of reassessment for our 2011 tax year.We have recorded a cumulative tax provision of$58 million,where an argument could be made that,ba
233、sed on our methodology,our transfer price may have fallen outside of an appropriate range of pricing in uranium contracts for the period from 2003 through 2016.We are confident that we will be successful in our case and continue to believe the ultimate resolution of this matter will not be material
234、to our financial position,results of operations and cash flows in the year(s)of resolution.For the years 2003 through 2011,CRA issued notices of reassessment for approximately$4.1 billion of additional income for Canadian tax purposes,which would result in a related tax expense of about$1.2 billion.
235、CRA has also issued notices of reassessment for transfer pricing penalties for the years 2007 through 2010 in the amount of$292 million.The Canadian income tax rules include provisions that require larger companies like us to remit or otherwise secure 50%of the cash tax plus related interest and pen
236、alties at the time of reassessment.To date,under these provisions,after applying elective deductions,we have paid a net amount of$264 million in cash.In addition,we have provided$420 million in letters of credit(LC)to secure 50%of the cash taxes and related interest amounts reassessed after 2014.The
237、 amounts paid or secured are shown in the table below.INTEREST TRANSFER AND INSTALMENT PRICING CASH SECURED BY YEAR PAID($MILLIONS)CASH TAXES PENALTIES PENALTIES TOTAL REMITTANCE LC Prior to 2013-13-13 13 -2013 1 9 36 46 46 -2014 106 47-153 153 -2015 202 71 79 352 20 332 2016 51 38 31 120 32 88 Tota
238、l 360 178 146 684 264 420 Using the methodology we believe CRA will continue to apply,and including the$4.1 billion already reassessed,we expect to receive notices of reassessment for a total of approximately$8.1 billion of additional income taxable in Canada for the years 2003 through 2016,which wo
239、uld result in a related tax expense of approximately$2.4 billion.As well,CRA may continue to apply transfer pricing penalties to taxation years subsequent to 2010.As a result,we estimate that cash taxes and transfer pricing penalties for these years would be between$1.75 billion and$1.95 billion.In
240、addition,we estimate there would be interest and instalment penalties applied that would be material to us.While in dispute,we would be responsible for remitting or otherwise providing security for 50%of the cash taxes and transfer pricing penalties(between$875 million and$975 million),plus related
241、interest and instalment penalties assessed,which would be material to us.Under the Canadian federal and provincial tax rules,the amount required to be paid or secured each year will depend on the amount of income reassessed in that year and the availability of elective deductions and tax loss carryo
242、vers.CRA has decided to disallow the use of any loss carry-backs for any transfer pricing adjustment,starting with the 2008 tax year.This does not impact the anticipated income tax expense for a particular year,but does impact the timing of any required security or payment.As noted above,beginning w
243、ith the 2010 tax year,as an alternative to paying cash,we used letters of credit to satisfy our obligations related to the reassessed income tax and related interest amounts.We expect to be able to continue to provide security in the form of letters of credit to satisfy these requirements.The estima
244、ted amounts summarized in the table below reflect actual amounts paid or secured and estimated future amounts owing based on the actual and expected reassessments for the years 2003 through 2016,and include the expected timing adjustment for the inability to use any loss carry-backs starting in 2008
245、.We will update this table annually to include the estimated impact of reassessments expected for completed years subsequent to 2016.$MILLIONS 2003-2016 2017-2018 2019-2023 TOTAL 50%of cash taxes and transfer pricing penalties paid,secured or owing in the period Cash payments 187 65-90 145-170 390-4
246、45 Secured by letters of credit 319 10-35 150-175 480-530 Total paid1 506 75-125 295-345 875-975 1 These amounts do not include interest and instalment penalties,which totaled approximately$178 million to December 31,2016.In light of our view of the likely outcome of the case as described above,we e
247、xpect to recover the amounts remitted,including the$684 million already paid or otherwise secured to date.The trial related to the 2003,2005 and 2006 reassessments commenced in October,2016.Final arguments are expected in the second half of 2017.If this timing is adhered to,we expect to receive a Ta
248、x Court decision within six to 18 months after the trial is complete.IRS dispute We received Revenue Agents Reports(RARs)from the IRS for the 2009 though 2012 tax years,whereby the IRS has challenged the transfer pricing used under certain intercompany transactions pertaining to the above tax years
249、for certain of our US subsidiaries.The RARs list the adjustments proposed by the IRS and calculate the tax and any penalties owing based on the proposed adjustments.The audit position of the IRS is that a portion of the non-US income reported under our corporate structure and taxed in non-US jurisdi
250、ctions should be recognized and taxed in the US on the basis that:the prices received by our US mining subsidiaries for the sale of uranium to CEL are too lowthe compensation earned by Cameco Inc.,one of our US subsidiaries,is inadequateThe proposed adjustments result in an increase in taxable incom
251、e in the US of approximately$419 million(US)and a corresponding increased income tax expense of approximately$122 million(US)for the 2009 through 2012 taxation years,with interest being charged thereon.In addition,the IRS proposed cumulative penalties of approximately$8 million(US)in respect of the
252、adjustment.We believe that the conclusions of the IRS in the RARs are incorrect and we are contesting them in an administrative appeal,during which we are not required to make any cash payments.Until this matter progresses further,we cannot provide an estimation of the likely timeline for a resoluti
253、on of the dispute.We believe that the ultimate resolution of this matter will not be material to our financial position,results of operations and cash flows in the year(s)of resolution.30 CAMECO CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS 31 Overview of disputes The table below provides an overv
254、iew of some of the key points with respect to our CRA and IRS tax disputes.CRA IRS Basis for dispute Corporate structure/governance Transfer pricing methodology used forcertain intercompany uranium sale andpurchase agreements Allocates Cameco Europe Ltd.(CEL)income(as adjusted)for 2003 through2011 t
255、o Canada(same income we paid taxon in foreign jurisdictions and includesincome that IRS is proposing to tax)Income earned on sales of uranium by theUS mines to CEL is inadequate Compensation earned by Cameco Inc.,one of our US subsidiaries,is inadequate Allocates a portion of CELs income for theyear
256、s 2009 through 2012 to the US(aportion of the same income we paid tax onin foreign jurisdictions and which the CRAis proposing to tax)Years under consideration CRA reassessed 2003 to 2011 Auditing 2012 to 2014 IRS has proposed adjustments for 2009through 2012 Auditing 2013 to 2015Timing of resolutio
257、n The trial related to the 2003,2005 and2006 reassessments commenced inOctober 2016,with final argumentsexpected in the second half of 2017 Expect Tax Court decision six to 18months after completion of trial Contesting proposed adjustments in anadministrative appeal We cannot yet provide an estimate
258、 as tothe timeline for resolutionRequired payments Expect to provide security in form of lettersof credit and/or make cash payments for50%of cash taxes,interest and penaltiesas reassessed Paid$264 million in cash to date Secured$420 million using letters of credit No security or cash payments requir
259、edwhile under administrative appealCaution about forward-looking information relating to our CRA and IRS tax dispute This discussion of our expectations relating to our tax disputes with CRA and IRS and future tax reassessments by CRA and IRS is forward-looking information that is based upon the ass
260、umptions and subject to the material risks discussed under the heading Caution about forward-looking information beginning on page 2 and also on the more specific assumptions and risks listed below.Actual outcomes may vary significantly.Assumptions CRA will reassess us for the years 2012 through 201
261、6 usinga similar methodology as for the years 2003 through 2011,and the reassessments will be issued on the basis we expectwe will be able to apply elective deductions and utilize lettersof credit to the extent anticipatedCRA will seek to impose transfer pricing penalties(in amanner consistent with
262、penalties charged in the years 2007through 2010)in addition to interest charges and instalmentpenaltieswe will be substantially successful in our dispute with CRAand the cumulative tax provision of$58 million to date will beadequate to satisfy any tax liability resulting from theoutcome of the dispu
263、te to dateIRS may propose adjustments for later years subsequent to2012we will be substantially successful in our dispute with IRSMaterial risks that could cause actual results to differ materially CRA reassesses us for years 2012 through 2016 using adifferent methodology than for years 2003 through
264、 2011,orwe are unable to utilize elective deductions or letters of creditto the extent anticipated,resulting in the required cashpayments or security provided to CRA pending the outcomeof the dispute being higher than expectedthe time lag for the reassessments for each year is differentthan we curre
265、ntly expectwe are unsuccessful and the outcomes of our dispute withCRA and/or IRS result in significantly higher cash taxes,interest charges and penalties than the amount of ourcumulative tax provision,which could have a materialadverse effect on our liquidity,financial position,results ofoperations
266、 and cash flowscash tax payable increases due to unanticipated adjustmentsby CRA or IRS not related to transfer pricingIRS proposes adjustments for years 2013 through 2015using a different methodology than for 2009 through 2012we are unable to effectively eliminate all double taxationTax outlook for
267、 2017 On an adjusted net earnings basis,we expect a tax recovery of$10 to$20 million in 2017 from our uranium,fuel services and NUKEM segments.Our consolidated tax rate is a blend of the statutory rates applicable to taxable income earned or tax losses incurred in Canada and in our foreign subsidiar
268、ies.We have a global customer base and we have established a marketing and trading structure involving foreign subsidiaries,which entered into various intercompany purchase and sale arrangements,as well as uranium purchase and sale agreements with third parties.Cameco and its subsidiaries made reaso
269、nable efforts to put arms-length transfer pricing arrangements in place,and these arrangements expose the parties to the risks and rewards accruing to them under these contracts.The intercompany contract prices are generally comparable to those established in comparable contracts between arms-length
270、 parties entered into at that time.In 2016,many of the existing intercompany purchase and sale arrangements in our portfolio expired.We have started to replace these contracts and will continue to put new intercompany arrangements in place,which,as the existing arrangements did,will reflect the mark
271、et at the time they are signed.As a result,in 2018,we expect our consolidated tax rate will transition to a modest expense,and trend toward a tax expense of approximately 20%over the next five years.The actual effective tax rate will vary from year-to-year,primarily due to the actual distribution of
272、 earnings among jurisdictions and the market conditions at the time transactions occur under both our intercompany and third-party purchase and sale arrangements.FOREIGN EXCHANGE The exchange rate between the Canadian dollar and US dollar affects the financial results of our uranium and fuel service
273、s segments.We sell the majority of our uranium and fuel services products under long-term sales contracts,which are routinely denominated in US dollars,while our production costs are largely denominated in Canadian dollars.To provide cash flow predictability we hedge a portion of our net US/Cdn expo
274、sure(e.g.total US dollar sales less US dollar expenditures and product purchases)to manage shorter term exchange rate volatility.Our risk management policy permits us to hedge 35%to 100%of our expected net exposure over a rolling 60-month period.Our normal practice is to layer in hedge contracts ove
275、r a three-to four-year period with the hedge percentage being highest in the first 12 months and decreasing hedge percentages in subsequent years.The portion of our net exposure that remains unhedged is subject to prevailing market exchange rates for the period.Therefore,our results are affected by
276、the movements in the exchange rate on our hedge portfolio(explained below),and on the unhedged portion of our net exposure.A weakening Canadian dollar would have a positive effect on the unhedged exposure,and a strengthening Canadian dollar would have a negative effect.See Revenue,adjusted net earni
277、ngs,and cash flow sensitivity analysis on page 35 for more information on how a change in the exchange rate will impact our revenue,cash flow,adjusted net earnings(ANE),and gains and losses on derivatives,presented on an ANE basis.Impact of hedging on IFRS earnings We do not use hedge accounting und
278、er IFRS and,therefore,we are required to report gains and losses on all hedging activity,both for contracts that close in the period and those that remain outstanding at the end of the period.For the contracts that remain outstanding,we must treat them as though they were settled at the end of the r
279、eporting period(mark-to-market).However,we do not believe the gains and losses that we are required to report under IFRS appropriately reflect the intent our hedging activities,so we make adjustments in calculating our ANE to better reflect the benefits of our hedging program in the applicable repor
280、ting period.Impact of hedging on ANE We designate contracts for use in particular periods,based on our expected net exposure in that period.Hedge contracts are layered in over time based on this expected net exposure.The result is that our current hedge portfolio is made up of a number of contracts
281、which are currently designated to net exposures we expect in 2017,2018 and 2019 and we will recognize the gains or losses in ANE in those periods.32 CAMECO CORPORATION MANAGEMENTS DISCUSSION AND ANALYSIS 33 For the purposes of ANE,gains and losses on derivatives are reported based on the difference
282、between the effective hedge rate of the contracts designated for use in the particular period and the exchange rate at the time of settlement.This results in an adjustment to current period IFRS earnings to effectively remove reported gains or losses on derivatives that arise from contracts put in p
283、lace for use in future periods.The effective hedge rate will lag the market in periods of rapid currency movement.See Non-IFRS measures on page 24.The table below provides a summary of our hedge portfolio at December 31,2016.You can use this information to estimate the expected gains or losses on de
284、rivatives for 2017 on an ANE basis.However,if we add contracts to the portfolio that are designated for use in 2017 or if there are changes in the US/Cdn exchange rates in the year,those expected gains or losses could change.HEDGE PORTFOLIO SUMMARY DECEMBER 31,2016 AFTER($MILLIONS)2017 2018 2019 201
285、9 TOTAL US dollar forward contracts($millions)403290 50-743Average contract rate 1(US/Cdn dollar)1.311.311.31-1.31US dollar option contracts($millions)50 20 40-110Average contract rate range1(US/Cdn dollar)1.30 to 1.35 1.29 to 1.34 1.28 to 1.35-1.29 to 1.35Total US dollar hedge contracts($millions)4
286、53 310 90-853Effective Hedge Rate range2(US/Cdn dollar)1.19 to 1.20 1.20 to 1.21 1.20 to 1.21-1.20 to 1.21Hedge ratio350%32%11%0%21%1 The average contract rate is the average of the rates stipulated in the outstanding contracts.2 The effective hedge rate is the exchange rate on the original hedge co
287、ntract at the time it was established and designated for use.Therefore the effective hedge rate range shown reflects an average of contract exchange rates at the time of designation.3 Hedge ratio is calculated by dividing the amount(in foreign currency)of outstanding derivative contracts by estimate
288、d future net exposures.At December 31,2016:The value of the US dollar relative to the Canadian dollar was$1.00(US)for$1.34(Cdn),down from$1.00(US)for$1.38(Cdn)at December 31,2015.The exchange rate averaged$1.00(US)for$1.32(Cdn)over the year.The mark-to-market loss on all foreign exchange contracts w
289、as$25 million compared to a$167 million loss at December31,2015.We manage counterparty risk associated with hedging by dealing with highly rated counterparties and limiting our exposure.At December 31,2016,all of our hedging counterparties had a Standard&Poors(S&P)credit rating of A or better.For in
290、formation on the impact of foreign exchange on our intercompany balances,see note 25 to the financial statements.34 CAMECO CORPORATION Outlook for 2017 Our strategy is to focus on our tier-one assets and profitably produce at a pace aligned with market signals,while maintaining the ability to respon
291、d to conditions as they evolve.Our outlook for 2017 reflects the expenditures necessary to help us achieve our strategy and is based on the assumptions found below the table,including a given uranium spot price,uranium term price,and foreign exchange rate.For more information on how changes in the e
292、xchange rate or uranium prices can impact our outlook see Revenue,adjusted net earnings,and cash flow sensitivity analysis on page 35,and Foreign exchange on page 32.Our 2017 financial outlook,and other disclosures relating to our contract portfolio,have been presented on a basis that excludes our c
293、ontract with TEPCO,which is under dispute.We do not provide an outlook for the items in the table that are marked with a dash.See 2016 Financial results by segment on page 42 for details.2017 FINANCIAL OUTLOOK CONSOLIDATED URANIUM FUEL SERVICES NUKEM EXPECTED CONTRIBUTION TO GROSS PROFIT 100%84%15%1
294、%Production-25.2 million lbs 8 to 9 million kgU-Sales volume1-30 to 32 million lbs2 11 to 12 million kgU 5 to 6 million lbs U3O8 Revenue($million)1 1,950 to 2,080 1,470 to 1,5703 300 to 330-Average realized price3-$49.00/lb2-Average unit cost of sales(including D&A)-$36.00-38.00/lb4$21.60-22.60/kgU-
295、Gross profit-3%to 4%Direct administration costs5$150-160 million-Exploration costs-$30 million-Expected loss on derivatives-ANE basis3$45-50 million-Tax recovery-ANE basis6$10-20 million-Capital expenditures$190 million-1 Our 2017 outlook for sales volume and revenue does not include sales between o
296、ur uranium,fuel services and NUKEM segments.2 Based on the volumes we currently have commitments to deliver under contract in 2017.3 Based on a uranium spot price of$26.00(US)per pound(the Ux spot price as of February 6,2017),a long-term price indicator of$30.00(US)per pound(the Ux long-term indicat
297、or on January 30,2017)and an exchange rate of$1.00(US)for$1.30(Cdn).4 Based on the expected unit cost of sales for produced material and committed long-term purchases.If we make discretionary purchases in 2017,then we expect the overall unit cost of sales may be affected.5 Direct administration cost
298、s do not include stock-based compensation expenses.See page 27 for more information.6 Our outlook for the tax recovery is based on adjusted net earnings and the other assumptions listed in the table.If other assumptions change then the expected recovery may be affected.Back to section Table of Conte
299、ntsMANAGEMENTS DISCUSSION AND ANALYSIS 35 REVENUE,ADJUSTED NET EARNINGS,AND CASH FLOW SENSITIVITY ANALYSIS IMPACT ON:FOR 2017($MILLIONS)CHANGE REVENUE ANE CASH FLOW Uranium spot and term price1$5(US)/lb increase 65 46 55$5(US)/lb decrease (43)(29)(33)Value of Canadian dollar vs US dollar One cent de
300、crease in CAD 14 6 5 One cent increase in CAD (14)(6)(5)1 Assuming change in both Ux spot price($26.00(US)per pound on February 6,2017)and the Ux long-term price indicator($30.00(US)per pound on January 30,2017)PRICE SENSITIVITY ANALYSIS:URANIUM SEGMENT The following table is not a forecast of price
301、s we expect to receive.The prices we actually realize will be different from the prices shown in the table.It is designed to indicate how the portfolio of long-term contracts we had in place on February 1,2017 would respond to different spot prices.In other words,we would realize these prices only i
302、f the contract portfolio remained the same as it was on February 1,2017,and none of the assumptions we list below change.We intend to update this table each quarter in our MD&A to reflect deliveries made and changes to our contract portfolio.As a result,we expect the table to change from quarter to
303、quarter.Expected realized uranium price sensitivity under various spot price assumptions(rounded to the nearest$1.00)SPOT PRICES($US/lb U3O8)$20$40$60$80$100$120$140 2017 Provided above in financial outlook table and in revenue,adjusted net earnings,and cash flow sensitivity analysis 2018 37 45 57 6
304、8 78 87 952019 34 44 56 66 75 83 892020 36 45 57 66 75 82 882021 33 44 58 68 77 86 94The table illustrates the mix of long-term contracts in our February 1,2017 portfolio,and is consistent with our marketing strategy.It has been updated to reflect contracts entered into up to February 1,2017,and it
305、excludes our contract under dispute with TEPCO.Our portfolio includes a mix of fixed-price and market-related contracts,which we target at a 40:60 ratio.Those that are fixed at lower prices or have low ceiling prices will yield prices that are lower than current market prices.36 CAMECO CORPORATION _
306、 Our portfolio is affected by more than just the spot price.We made the following assumptions(which are not forecasts)to create the table:Sales sales volumes on average of 24 million pounds per year,with commitment levels in 2017 through 2019 higher than in2020 and 2021excludes sales between our ura
307、nium,fuel services and NUKEM segments excludes the contract under dispute with TEPCODeliveries deliveries include best estimates of requirements contractsand contracts with volume flex provisionsAnnual inflation is 2%in the USPrices the average long-term price indicator is the same as theaverage spo
308、t price for the entire year(a simplified approach for this purpose only).Since 1996,the long-term price indicator has averaged 20%higher than the spot price.This differential has varied significantly.Assuming the long-term price is at a premium to spot,the prices in the table and graph will be highe
309、r.Liquidity and capital resources Our financial objective is to ensure we have the cash and debt capacity to fund our operating activities,investments and growth.At the end of 2016,we had cash and short-term investments of$320 million in a mix of short-term deposits,while our total debt amounted to$
310、1.5 billion.We have large,creditworthy customers that continue to need uranium even during weak economic conditions,and we expect the uranium contract portfolio we have built to provide a solid revenue stream for years to come.We expect to continue investing in maintaining our tier-one production ca
311、pacity and flexibility over the next several years.We have a number of alternatives to fund future capital requirements,including using our operating cash flow,drawing on our existing credit facilities,entering new credit facilities,and raising additional capital through debt or equity financings.We
312、 are always considering our financing options so we can take advantage of favourable market conditions when they arise.Due to the cyclical nature of our business,we may need to temporarily draw on our short-term liquidity during the course of the year.However,apart from these short-term fluctuations
313、,we expect our cash balances and operating cash flows to meet our capital requirements during 2017.We have an ongoing transfer pricing dispute with CRA.See page 28 for more information.Until this dispute is resolved,we expect to pay cash or provide security in the form of letters of credit for futur
314、e amounts owing to the Government of Canada for 50%of the cash taxes payable and the related interest and penalties.We have provided an estimate of the amount and timing of the expected cash taxes and transfer pricing penalties paid,secured or owing in the table on page 30.FINANCIAL CONDITION 2016 2
315、015 Cash position($millions)320 459(cash and cash equivalents)Cash provided by operations($millions)312 450(net cash flow generated by our operating activities after changes in working capital)Cash provided by operations/net debt 27%44%(net debt is total consolidated debt,less cash position)Net debt
316、/total capitalization 18%16%(total capitalization is net debt and equity)CREDIT RATINGS The credit ratings assigned to our securities by external ratings agencies are important to our ability to raise capital at competitive pricing to support our business operations.Our investment grade credit ratin
317、gs reflect the current financial strength of our company.Back to section Table of ContentsMANAGEMENTS DISCUSSION AND ANALYSIS 37 Third-party ratings for our commercial paper and senior debt as of February 8,2017:SECURITY DBRS S&P Commercial paper R-2(high)A-1(low)1Senior unsecured debentures BBB(hig
318、h)BBB+Rating trend/rating outlook Stable Stable2 1 Canadian National Scale Rating.The Global Scale Rating is A-2.2 On January 19,2017,S&P confirmed Camecos outlook as stable,but placed Cameco on Credit Watch Negative.DBRS provides guidance for the outlook of the assigned rating using the rating tren
319、d.The rating trend represents their assessment of the likelihood and direction that the rating could change in the future,should present tendencies continue,or in some cases,if challenges are not overcome.S&P uses rating outlooks to assess the potential direction of a long-term credit rating over th
320、e intermediate term.Their outlook indicates the likelihood that the rating could change in the future.The rating agencies may revise or withdraw these ratings if they believe circumstances warrant.A change in our credit ratings could affect our cost of funding and our access to capital through the c
321、apital markets.Liquidity($MILLIONS)2016 2015 Cash and cash equivalents at beginning of year 459 567 Cash from operations 312 450 Investment activities Additions to property,plant and equipment and acquisitions(217)(359)Other investing activities(1)18Financing activities Interest paid(71)(70)Dividend
322、s(158)(158)Exchange rate on changes on foreign currency cash balances(4)11Cash and cash equivalents at end of year 320 459 CASH FROM OPERATIONS Cash from operations was 31%lower than in 2015.This was primarily due to lower profits in our uranium and NUKEM segments partially offset by the settlement
323、and rollover of contracts in our hedge portfolio which required less cash during 2016 compared to 2015.Not including working capital requirements,our operating cash flows in the year were down$140 million.See note 22 to the financial statements.INVESTING ACTIVITIES Cash used in investing includes ac
324、quisitions and capital spending.Capital spending We classify capital spending as sustaining,capacity replacement or growth.As a mining company,sustaining capital is the money we spend to keep our facilities running in their present state,which would follow a gradually decreasing production curve,whi
325、le capacity replacement capital is spent to maintain current production levels at those operations.Growth capital is money we invest to generate incremental production,and for business development.38 CAMECO CORPORATION CAMECOS SHARE($MILLIONS)2016 PLAN1 2016 ACTUAL 2017 PLAN Sustaining capital McArt
326、hur River/Key Lake 301815 Cigar Lake 201815 Rabbit Lake 1012-US ISR 525 Inkai 515 Fuel services 151220 Other 555 Total sustaining capital 906865 Capacity replacement capital McArthur River/Key Lake 403945 Cigar Lake 201950 US ISR 58-Inkai 101215 Total capacity replacement capital 7578110 Growth capi
327、tal McArthur River/Key Lake 352910 Cigar Lake 3035-Inkai 1045 Fuel services 53-Total growth capital 807115 Total uranium&fuel services 245 1217190 1 Capital spending outlook was updated to$245 million(from$320 million)in our third quarter MD&A.Outlook for investing activities CAMECOS SHARE($MILLIONS
328、)2018 PLAN 2019 PLAN Total uranium&fuel services 200-250200-250 Sustaining capital 70-9085-105Capacity replacement capital 110-125100-115 Growth capital 20-3515-30We expect total 2017 capital expenditures for uranium and fuel services to be about 12%lower than in 2016.Major sustaining,capacity repla
329、cement and growth expenditures in 2017 include:McArthur River/Key Lake the expansion of freeze capacity and mine development.Cigar Lake work to expand freezing capacity and underground development make up the largest portion of capital at theCigar Lake site.Our expectation to spend between$200 milli
330、on and$250 million in 2018 remains unchanged.This information regarding currently expected capital expenditures for future periods is forward-looking information,and is based upon the assumptions and subject to the material risks discussed on pages 2 and 3.Our actual capital expenditures for future
331、periods may be significantly different.FINANCING ACTIVITIES Cash from financing includes borrowing and repaying debt,and other financial transactions including paying dividends and providing financial assurance.MANAGEMENTS DISCUSSION AND ANALYSIS 39 Long-term contractual obligations 2018 AND 2020 AN
332、D 2022 AND DECEMBER 31($MILLIONS)2017 2019 2021 BEYOND TOTAL Long-term debt-500-1,0001,500 Interest on long-term debt6913982185475Provision for reclamation1895828421,037Provision for waste disposal 2 12 1-15Other liabilities-7070Capital commitments51-51Total1407461652,0973,148We have contractual cap
333、ital commitments of approximately$51 million at December 31,2016.Certain of the contractual commitments may contain cancellation clauses;however,we disclose the commitments based on managements intent to fulfil the contracts.We have unsecured lines of credit of about$2.8 billion,which include the following:A$1.25 billion unsecured revolving credit facility that matures November 1,2020.Each year on
0731-84720580
sgpjbg002
工作日 9:30 - 18:00
研報
新質生產力
DeepSeek?
低空經濟
大模型
AI Agent
AI Infra
具身智能
自動駕駛
寵物
銀發經濟
人形機器人
企業出海
算力
微短劇
薪酬
白皮書
創新藥
人工智能
AI產業
信息科技
互聯網
消費經濟
汽車交通
電商零售
傳媒娛樂
醫藥健康
投資金融
能源環境
地產建筑
傳統產業
英文報告
其它
最新報告
中英對照
全文搜索
報告精選
PDF上傳翻譯
多格式文檔互轉
入駐&報告售賣
會員權益
機構報告
券商研報
財報庫
專題合集
英文報告
數據圖表
會議報告
其他資源
行業聚焦
芯片產業
熱點概念
全球咨詢智庫
人工智能
500強
新質生產力
會議峰會
新能源汽車
企業年報
互聯網
公司研究
行業綜觀
消費教育
科技通信
醫藥健康
人力資源
投資金融
汽車產業
物流地產
電子商務
傳統產業
傳媒營銷
其它
2025低空經濟/低空產業報告合集（共50套打包）
2025年智算中心/AIDC/AI數據中心研究報告合集（共37套打包）
AI、科技與通信
廣告、傳媒與營銷
消費、零售與支付
HR、文化與旅游
金融、保險與投資
能源、環境與工業
醫療制藥與大健康
物流、地產與建筑
其他行業
AI ? 科技 ? 通信
數字化
金融財經
智能制造
電商傳媒
地產建筑
醫療醫學
能源化工
其他行業
收藏
下載
2025-05-20
AI查數
行業數據
政策法規
商業模式
產業鏈
競爭格局
市場規模
產業概述
其它
2025年
AI讀財報
年報
一季報
半年報
三季報
IPO招股書
社會責任報告
A股
IPO申報
港股
美股&全球
新三板
掃碼登錄
手機快捷登錄
賬號登錄
