CENTRUS ENERGY CORP

Previous wording

Our LEU segment currently provides most of the Company’s revenue and involves the sale of enriched uranium, the fissile component of nuclear fuel, primarily to utilities that operate commercial nuclear power plants. The majority of these sales are for the enrichment component of LEU, which is measured in SWU. Centrus also sells natural uranium hexafluoride (the raw material needed to produce LEU) and occasionally sells uranium concentrates, uranium conversion, or LEU with the natural uranium hexafluoride and SWU components combined into one sale.

Current wording

Our LEU segment provides most of the Company’s revenue and involves the sale of enriched uranium, the fissile component of nuclear fuel, primarily to utilities that operate commercial nuclear power plants. The majority of these sales are for the enrichment component of LEU, which is measured in SWU. Centrus also sells natural uranium hexafluoride (the raw material needed to produce LEU) and occasionally sells uranium concentrates, uranium conversion, or LEU with the natural uranium hexafluoride and SWU components combined into one sale.

Previous wording

The Company’s work on HALEU began under the HALEU Demonstration Contract, signed with the DOE in 2019 to construct a cascade of 16 AC100M centrifuges in Piketon, Ohio to demonstrate HALEU production. The DOE has funded the contract up to $173.0 million with a period of performance that ended November 30, 2022. Closeout activities on the HALEU Demonstration Contract are ongoing. In 2022, the DOE elected to change the scope of the HALEU Demonstration Contract and moved the operational portion of the contract to the new, competitively-awarded HALEU Operation Contract that would provide for a longer period of operation and HALEU production than would have been possible under the HALEU Demonstration Contract.

Current wording

The Company’s work on HALEU began under the HALEU Demonstration Contract, signed with the DOE in 2019 to construct a cascade of 16 AC100M centrifuges in Piketon, Ohio to demonstrate HALEU production. The DOE has funded the contract up to $173.0 million with a period of performance that ended November 30, 2022. Closeout activities on the HALEU Demonstration Contract are ongoing.

Previous wording

On November 10, 2022, the DOE notified Centrus that the Company had been awarded the HALEU Operation Contract and work began on December 1, 2022. The base contract value was approximately $150.0 million with two phases through 2024. Phase 1 included an approximately $30.0 million cost-share contribution from Centrus matched by approximately $30.0 million from the DOE to complete construction of the cascade, begin operations and produce the initial 20 kilograms of HALEU UF 6 by no later than December 31, 2023. On November 7, 2023, the Company announced that it made its first delivery of HALEU to the DOE, completing Phase 1 by successfully demonstrating its HALEU production process.

Current wording

On November 10, 2022, the DOE notified Centrus that the Company had been awarded the HALEU Operation Contract and work began on December 1, 2022. The base contract value was approximately $150.0 million with two phases through 2024. Phase 1 included an approximately $30.0 million cost-share contribution from Centrus matched by approximately $30.0 million from the DOE to complete construction of the cascade, begin operations and produce the initial 20 kilograms of HALEU UF 6 by no later than December 31, 2023. On November 7, 2023, the Company announced that it made its first contractual delivery of HALEU to the DOE, completing Phase 1 by successfully demonstrating its HALEU production process.

Previous wording

During November 2023, the Company transitioned to Phase 2 of the HALEU Operation Contract which includes production of 900 kilograms of HALEU UF 6 per year as well as continued operations and maintenance. The DOE owns the HALEU produced from the demonstration cascade, and Centrus is being compensated on a cost-plus-incentive-fee basis, with an initial Phase 2 contract value of approximately $90.0 million, subject to Congressional appropriations. DOE has increased the Phase 2 contract value and related funding to $152.3 million. The HALEU Operation Contract also gives DOE options to pay for up to nine additional years of production from the cascade beyond the base contract; those options are at the DOE’s sole discretion and subject to the availability of Congressional appropriations. Concurrently, pursuant to an amendment to our lease for the Piketon facility, the DOE assumed all D&D liabilities arising out of the HALEU Operation Contract.

Current wording

During November 2023, the Company transitioned to Phase 2 of the HALEU Operation Contract, which included production of 900 kilograms of HALEU UF 6 per year, as well as continued operations and maintenance. Phase 2 had an initial contract value of approximately $90.0 million and the Company is being compensated on a cost-plus-incentive-fee-basis. The DOE owns the HALEU produced from the demonstration cascade. The HALEU Operation Contract also gives DOE the ability to exercise three optional periods to contract for up to nine additional years of production from the cascade beyond the base contract; those options are at the DOE’s sole discretion and subject to the availability of Congressional appropriations. Pursuant to an amendment to the Company’s lease for the Piketon facility, the DOE assumed all D&D liabilities arising out of the HALEU Operation Contract.

Previous wording

Under the HALEU Operation Contract, DOE is contractually required to provide the 5B Cylinders necessary to collect the output of the cascade, but ongoing supply chain challenges had created difficulties for DOE in securing enough 5B Cylinders for the entire production year under Phase 2. During the time periods when 5B Cylinders were insufficient, the Company was able to continue operations of the cascade, but did not produce HALEU as it did not have cylinders to store the enriched uranium. Due to these delays, Centrus was unable to achieve delivery of the 900 kilograms of HALEU UF6 for Phase 2 by November 2024. In light of these delays, on November 5, 2024, the HALEU Operation Contract was modified to extend the Phase 2 period of performance to June 30, 2025. In accordance with the HALEU Operation Contract, the Company has submitted several change requests for work being performed on infrastructure, facility repairs, and 5B Cylinders. The additional work is being performed under the DOE’s technical direction. Centrus delivered approximately 670 kilograms of HALEU UF 6 to DOE through March 31, 2025. The target fee for Phase 2 of the contract was estimated to be $7.7 million based on the estimated costs for the contract and is subject to a contract minimum fee of $6.9 million.

Current wording

Under the HALEU Operation Contract, DOE is contractually obligated to provide the 5B Cylinders necessary to collect the output of the cascade, but supply chain challenges had created difficulties for DOE in securing enough 5B Cylinders for the entire production year under Phase 2. During time periods when 5B Cylinders were insufficient, the Company was able to continue operations of the cascade, but did not produce HALEU as it did not have 5B Cylinders to store the enriched uranium. Due to these delays, Centrus was unable to achieve contractual delivery of the 900 kilograms of HALEU UF 6 by the date set for the end of Phase 2 performance. Centrus’ contractual delivery obligation of 900 kilograms by November 2024, was conditioned on DOE’s ability to provide the 5B Cylinders on a timeline that allowed for continuous production throughout Phase 2 of the contract. In light of the delays, on November 5, 2024, the HALEU Operation Contract was modified to extend the Phase 2 period of performance to June 30, 2025. On June 25, 2025, the Company announced that it had produced and contractually delivered to the DOE 900 kilograms of HALEU under the HALEU Operation Contract, thereby achieving the Phase 2 production target. As of June 30, 2025, the total Phase 2 contract value and funded value is $169.1 million. The fee for the Phase 2 period of performance that was extended beyond November 30, 2024 was not definitized and is subject to negotiation.

Previous wording

While the obligation to furnish compliant 5B Cylinders under the HALEU Operation Contract continues to rest with the DOE, Centrus has worked to help the DOE to secure additional cylinders. To support the DOE in mitigating the risk of further delays in delivery of 5B Cylinders, the Company received technical direction and a contract modification from the DOE to procure compliant 5B Cylinders and components. Centrus began to receive deliveries of additional 5B Cylinders in October 2024 and believes it has adequate cylinders to complete Phase 2.

Current wording

While the obligation to furnish compliant 5B Cylinders under the HALEU Operation Contract continues to rest with the DOE, Centrus has worked to help the DOE to secure additional cylinders. To support the DOE in mitigating the risk of further delays in delivery of 5B Cylinders, the Company received Contracting Officer approval and a contract modification from the DOE to procure compliant 5B Cylinders and components.

Previous wording

The DOE continues to pursue the availability of HALEU for the ARDP and for the advanced reactor market and the availability of domestically enriched uranium in a quantity that would be sufficient to address a supply disruption and gaps in domestic production and enrichment and has issued separate RFPs for the deconversion of HALEU, the production of HALEU and domestic production of LEU. The DOE awarded multiple IDIQ contracts to the successful bidders, after which the awardees will compete for individual task orders. The total aggregate funding to be awarded under the contracts is $3.4 billion with a minimum of $2.0 million for each contract which is partly funded through the IRA. Executive Order 14154, issued on January 20, 2025, directed executive agencies of the U.S. federal government to pause the distribution of federal funding, including funding appropriated under the IRA, pending a review of programs for issuing grants, loans, contracts, or any other financial disbursements. The timing of the pause and subsequent review, as well as the outcome of such review, remain uncertain.

Current wording

Of the $3.4 billion in appropriated funds, $700 million specifically related to HALEU is from the Inflation Reduction Act (“IRA”). Executive Order 14154, issued on January 20, 2025, directed executive agencies of the U.S. federal government to pause the distribution of federal funding, including funding appropriated under the IRA, pending a review of programs for issuing grants, loans, contracts, or any other financial disbursements. While implementation of the funding pause is currently subject to legal challenges, the ultimate outcomes, and DOE actions during the pendency, of these legal challenges remain uncertain. Should the pause continue to be implemented, the timing of the pause and subsequent review, as well as the outcome of such review, remain uncertain.

Previous wording

Meanwhile, on November 20, 2024, the Company announced the resumption of centrifuge manufacturing activities and the expansion of its manufacturing capacity at our facility in Oak Ridge, Tennessee. The Company is investing approximately $60.0 million over an 18 month period in this effort, which will help lay the groundwork to support a potential large-scale expansion of uranium enrichment in Piketon, Ohio.

Current wording

On November 20, 2024, the Company announced the resumption of centrifuge manufacturing activities and the expansion of its manufacturing capacity at its facility in Oak Ridge, Tennessee. The Company is investing approximately $60.0 million over an 18 month period in this effort, which will help lay the groundwork to support a potential large-scale expansion of uranium enrichment in Piketon, Ohio.

Previous wording

The Qualifying Advanced Energy Project Credit (“§48C”) was established by the American Recovery and Reinvestment Act of 2009 and renewed and expanded under the Inflation Reduction Act of 2022 (“IRA”). The §48C program aims to strengthen U.S. industrial competitiveness and clean energy supply chains. On October 18, 2024, the Company submitted an application for a clean energy manufacturing and recycling project associated with re-equipping our manufacturing property at our manufacturing facility in Oak Ridge. This will recreate a viable enrichment supply chain and allow ACO to manufacture centrifuge parts to be used in centrifuge machines to enrich uranium. Our application requested an allocation of $62.4 million based on a qualified investment in eligible property of $208.0 million made by Centrus. On January 10, 2025, the Company was informed that the Internal Revenue Service (“IRS”) granted our request for a $62.4 million credit allocation for this facility. Centrus now has two years from that date to provide evidence that the requirements of the credit have been met thus certifying our credit allocation. Upon certification of our credit allocation, we then have two years from that date to notify the DOE that the qualified investment in eligible property is placed in service to receive the credit allocation. It is uncertain how Executive Order 14154 will impact the IRS determination regarding our application request. For further details refer to Liquidity and Capital Resources in this Quarterly Report on Form 10-Q.

Current wording

The Qualifying Advanced Energy Project Credit (“§48C”) was established by the American Recovery and Reinvestment Act of 2009 and renewed and expanded under the IRA. The §48C program aims to strengthen U.S. industrial competitiveness and clean energy supply chains. On October 18, 2024, the Company submitted an application for a clean energy manufacturing and recycling project associated with re-equipping our manufacturing property at our manufacturing facility in Oak Ridge. This will recreate a viable enrichment supply chain and allow ACO to manufacture centrifuge parts to be used in centrifuge machines to enrich uranium. Our application requested an allocation of $62.4 million based on a qualified investment in eligible property of $208.0 million made by Centrus. On January 10, 2025, the Company was informed that the Internal Revenue Service (“IRS”) granted our request for a $62.4 million credit allocation for this facility. Centrus now has two years from that date to provide evidence that the requirements of the credit have been met thus certifying our credit allocation. Upon certification of our credit allocation, we then have two years from that date to notify the DOE that the qualified investment in eligible property is placed in service to receive the credit allocation. It is uncertain how Executive Order 14154 will impact the IRS determination regarding our application request. For further details refer to Liquidity and Capital Resources in this Quarterly Report on Form 10-Q.

Previous wording

While the monthly price indicators have increased for several years, the uranium enrichment segment of the nuclear fuel market remains oversupplied and faces uncertainty about future demand for nuclear power generation. However, without Russian supply, the global market would be undersupplied for uranium enrichment. Recent data from the International Trade Commission shows a significant increase in the importation of enriched uranium into the U.S. from China in 2023 and 2024. If this trend continues, it will likely result in significant changes in the competitive landscape that will affect pricing trends and customer spending patterns and create uncertainty and likely have a negative impact on our business. To address these changes, we have taken steps to adjust our cost structure; we may seek further adjustments to our cost structure and operations and evaluate opportunities to grow our business organically or through acquisitions and other strategic transactions.

Current wording

While the monthly price indicators have increased for several years, the uranium enrichment segment of the nuclear fuel market remains oversupplied and faces uncertainty about future demand for nuclear power generation. However, without Russian supply, the global market would be undersupplied for uranium enrichment. Recent data from the International Trade Commission shows a significant increase in the importation of enriched uranium into the U.S. from China beginning in 2023. If this trend continues, it will likely result in significant changes in the competitive landscape that will affect pricing trends and customer spending patterns and create uncertainty and likely have a negative impact on our business. To address these changes, we have taken steps to adjust our cost structure; we may seek further adjustments to our cost structure and operations and evaluate opportunities to grow our business organically or through acquisitions and other strategic transactions.

Previous wording

According to the WNA, as of March 2025, there were 66 reactors under construction worldwide, approximately one-half of which are in China. The United States, with over 90 operating reactors, remains the world’s largest market for nuclear fuel. The nuclear industry in the United States, Japan, and Europe faces headwinds as well as opportunities. In the United States, the industry has been under pressure from the expansion of subsidized renewable energy as well as relatively low-cost natural gas resources in recent years, although natural gas prices in the U.S. electricity sector tripled between 2020 and 2022 according to data from the U.S. Energy Information Administration (“EIA”). Eight U.S. reactors have prematurely shut down in the past ten years, and others could shut down in the next few years. At the same time, construction was completed and commercial operations began in the second quarter of 2024 on one large reactor and two formerly shutdown reactors have plans to restart. In 2023, the DOE released a report outlining a pathway to deployment of approximately 200 gigawatts of additional capacity by 2050, which would triple the nuclear energy capacity in the United States.

Current wording

According to the WNA, as of June 2025, there were 69 reactors under construction worldwide, approximately one-half of which are in China. The United States, with over 90 operating reactors, remains the world’s largest market for nuclear fuel. The nuclear industry in the United States, Japan, and Europe faces headwinds as well as opportunities. In the United States, the industry has been under pressure from the expansion of subsidized renewable energy as well as relatively low-cost natural gas resources in recent years. Eight U.S. reactors have prematurely shut down in the past ten years, and others could shut down in the next few years. At the same time, construction was completed and commercial operations began in the second quarter of 2024 on one large reactor and two formerly shutdown reactors have plans to restart.

Previous wording

The war in Ukraine escalated tensions between Russia and the international community. As a result, the United States and other countries imposed, including through the U.S.’s enactment of the Import Ban Act discussed below, and may continue imposing, additional sanctions, tariffs, and export controls against certain Russian products, services, organizations, and/or individuals. Such additional restrictions could affect our ability to purchase, take delivery of, transport, or re-sell Russian uranium enrichment, engage in transactions with TENEX, or implement the TENEX Supply Contract, which would have a negative material impact on our business. Further, tariffs or sanctions by the United States, Russia or other countries may impact our ability and cost to transport, export, import, take delivery, or make payments related to the LEU we purchase and may require us to increase purchases from non-Russian sources to the extent available. For example, due to restrictions imposed by Canada on the ability of Canadian persons and entities to provide ocean transportation services to Russia, a permit is required for our shipper, a Canadian company, to transport the LEU that we procure under the TENEX Supply Contract to the United States. A Canadian permit issued to our shipper was extended to March 2027, but for so long as the sanctions remain in place, the shipper will require further extensions beyond the current validity of the permit for continued shipments of LEU imports.

Current wording

The war in Ukraine escalated tensions between Russia and the international community. As a result, the United States and other countries imposed, including through the United States’s enactment of the Import Ban Act discussed below, and may continue imposing, additional sanctions, tariffs, and export controls against certain Russian products, services, organizations, and/or individuals. Such additional restrictions could affect our ability to purchase, take delivery of, transport, or re-sell Russian uranium enrichment, engage in transactions with TENEX, or implement the TENEX Supply Contract, which would have a negative material impact on our business. Further, tariffs or sanctions by the United States, Russia or other countries may impact our ability and cost to transport, export, import, take delivery, or make payments related to the LEU we purchase and may require us to increase purchases from non-Russian sources to the extent available. For example, due to restrictions imposed by Canada on the ability of Canadian persons and entities to provide ocean transportation services to Russia, a permit is required for our shipper, a Canadian company, to transport the LEU that we procure under the TENEX Supply Contract to the United States. A Canadian permit issued to our shipper was extended to March 2027, but for so long as the sanctions remain in place, the shipper will require further extensions beyond the current validity of the permit for continued shipments of LEU imports.

Previous wording

In addition to limitations targeted specifically at imports of LEU, the expanding sanctions imposed by the United States and foreign governments on the mechanisms used to make payments to Russia and to obtain services, including transportation and other services, have increased the risk that implementation of the TENEX Supply Contract may be disrupted in the future. For example, on April 17, 2025, the Office of the United States Trade Representative (“USTR”) released a notice issuing the results of its investigation into China’s dominance in the maritime, logistics, and shipbuilding sectors pursuant to Section 302(a) of the Trade Act of 1974, as amended. The USTR imposed new service fees on Chinese-built vessels entering U.S. ports above certain capacity. Our shipper of Russian LEU from Russia to the U.S. uses ships manufactured in China which happen to be exempt from the new fees under this notice. However, these fees would be significant if they were to be imposed on our shipper of Russian LEU. If the USTR changes its position and does not exempt the type of vessel our shipper uses, then the additional fees imposed on our shipper for docking at U.S. ports would be cost prohibitive and would have a significant impact on our ability to transport Russian LEU and would also have a material adverse effect on our financial position and results of operations. If the U.S. government were to prohibit companies and individuals from engaging in transactions with Rosatom and its subsidiaries, including TENEX, the Company and its suppliers could not implement the TENEX Supply Contract absent a license or other authorization from the sanctioning government.

Current wording

In addition to limitations targeted specifically at imports of LEU, the expanding sanctions imposed by the United States and foreign governments on the mechanisms used to make payments to Russia and to obtain services, including transportation and other services, have increased the risk that implementation of the TENEX Supply Contract may be disrupted in the future. For example, effective January 10, 2025, the U.S. Secretary of the Treasury, made a determination pursuant to section l(a)(i) of Executive Order 14024, to apply certain sanctions to any person determined, pursuant to that section, to operate or have operated in “the energy sector of the Russian Federation economy.” TENEX’s financial institutions have had challenges in accepting payments denominated in U.S. dollars and the Company and TENEX have agreed to delay certain payments under the TENEX Supply Contract as the parties review payment processing options. Additionally, on April 17, 2025, the Office of the United States Trade Representative (“USTR”) released a notice issuing the results of its investigation into China’s dominance in the maritime, logistics, and shipbuilding sectors pursuant to Section 302(a) of the Trade Act of 1974, as amended. The USTR imposed new service fees on Chinese-built vessels entering U.S. ports above certain capacity. Our shipper of Russian LEU from Russia to the U.S. uses ships manufactured in China which happen to be exempt from the new fees under this notice. However, these fees would be significant if they were to be imposed on our shipper of Russian LEU. If the USTR changes its position and does not exempt the type of vessel our shipper uses, then the additional fees imposed on our shipper for docking at U.S. ports would be cost prohibitive and would have a significant impact on our ability to transport Russian LEU and would also have a material adverse effect on our financial position and results of operations. If the U.S. government were to prohibit companies and individuals from engaging in transactions with Rosatom and its subsidiaries, including TENEX, the Company and its suppliers could not implement the TENEX Supply Contract absent a license or other authorization from the sanctioning government.

Previous wording

The Company’s backlog is $3.8 billion and $3.7 billion as of March 31, 2025 and December 31, 2024, respectively, and extends to 2040. The backlog is recognized as revenue in future periods as work is performed or deliveries of SWU and uranium are made.

Current wording

The Company’s backlog is $3.6 billion and $3.7 billion as of June 30, 2025 and December 31, 2024, respectively, and extends to 2040. The backlog is recognized as revenue in future periods as work is performed or deliveries of SWU and uranium are made.

Previous wording

Our backlog in the LEU segment extends to 2040. As of both March 31, 2025 and December 31, 2024, our backlog was approximately $2.8 billion. The backlog is the estimated aggregate dollar amount of revenue for future SWU and uranium deliveries primarily under medium and long-term contracts with fixed commitments and approximately $2.1 billion in contingent LEU sales commitments, with $1.7 billion of the total under definitive agreements and $0.4 billion of the total subject to entering into definitive agreements, in support of potential construction of LEU production capacity at the Piketon, Ohio facility. The contingent sales commitments depend on our ability to secure substantial public and private investment necessary to build new enrichment capacity. The LEU segment backlog also includes approximately $0.2 billion of deferred revenue and advances from customers as of March 31, 2025, whereby customers have made advance payments to be applied against future deliveries. No orders in our backlog are considered at risk related to customer operations. However, these medium and long-term contracts are subject to significant risks and uncertainties, including existing import laws and restrictions such as the RSA, which limits imports of Russian uranium products into the United States and applies to our sales using material procured under the TENEX Supply Contract, as well as the potential for additional sanctions and other restrictions affecting the Company or its suppliers, in response to the evolving situation regarding the war in Ukraine.

Current wording

Our backlog in the LEU segment extends to 2040. As of June 30, 2025 and December 31, 2024, our backlog was approximately $2.7 billion and $2.8 billion, respectively. The backlog is the estimated aggregate dollar amount of revenue for future SWU and uranium deliveries primarily under medium and long-term contracts with fixed commitments and approximately $2.1 billion in contingent LEU sales commitments, with $1.7 billion of the total under definitive agreements and $0.4 billion of the total subject to entering into definitive agreements, in support of potential construction of LEU production capacity at the Piketon, Ohio facility. The contingent sales commitments depend on our ability to secure substantial public and private investment necessary to build new enrichment capacity. The LEU segment backlog also includes approximately $0.2 billion of deferred revenue and advances from customers as of June 30, 2025, whereby customers have made advance payments to be applied against future deliveries. No orders in our backlog are considered at risk related to customer operations. However, these medium and long-term contracts are subject to significant risks and uncertainties, including existing import laws and restrictions such as the RSA, which limits imports of Russian uranium products into the United States and applies to our sales using material procured under the TENEX Supply Contract, as well as the potential for additional sanctions and other restrictions affecting the Company or its suppliers, in response to the evolving situation regarding the war in Ukraine.

Previous wording

Our backlog in the Technical Solutions segment extends to 2034. As of both March 31, 2025 and December 31, 2024, our backlog is approximately $0.9 billion, respectively. Our backlog includes both funded amounts (services for which funding has been both authorized and appropriated by the customer), unfunded amounts (services for which funding has not been appropriated), and unexercised options in our contracts. If any of our contracts were to be terminated or options not being exercised, our remaining backlog would be reduced by the expected value of the cancelled contracts or forgone options.

Current wording

Our backlog in the Technical Solutions segment extends to 2034. As of both June 30, 2025 and December 31, 2024, our backlog is approximately $0.9 billion. Our backlog includes both funded amounts (services for which funding has been both authorized and appropriated by the customer), unfunded amounts (services for which funding has not been appropriated), and unexercised options in our contracts. If any of our contracts were to be terminated or options not being exercised, our remaining backlog would be reduced by the expected value of the cancelled contracts or forgone options.

Previous wording

Revenue from our LEU segment accounted for approximately 70% of our total revenue for the three months ended March 31, 2025. The majority of our customers are domestic and international utilities that operate nuclear power plants, with international sales constituting approximately 34% of revenue from our LEU segment since 2023. Our agreements with electric utilities are primarily medium and long-term fixed-commitment contracts under which our customers are obligated to purchase a specified quantity of the SWU component of LEU from us. Contracts where we sell both the SWU and natural uranium hexafluoride components of LEU to utilities or where we sell natural uranium hexafluoride to utilities and other nuclear fuel related companies are generally shorter-term, fixed-commitment contracts. Individual customer orders for the SWU component of LEU fulfilled in the three months ended March 31, 2025 averaged approximately $12.8 million per order. As a result, a relatively small shift in the timing of customer orders for LEU may cause significant variability in our operating results period over period.

Current wording

Revenue from our LEU segment accounted for approximately 81% and 78% of our total revenue for the three and six months ended June 30, 2025, respectively. The majority of our customers are domestic and international utilities that operate nuclear power plants, with international sales constituting approximately 37% of revenue from our LEU segment since 2023. Our agreements with electric utilities are primarily medium and long-term fixed-commitment contracts under which our customers are obligated to purchase a specified quantity of the SWU component of LEU from us. Contracts where we sell both the SWU and natural uranium hexafluoride components of LEU to utilities or where we sell natural uranium hexafluoride to utilities and other nuclear fuel related companies are generally shorter-term, fixed-commitment contracts. Individual customer orders for the SWU component of LEU fulfilled in the six months ended June 30, 2025 averaged approximately $12.6 million per order. As a result, a relatively small shift in the timing of customer orders for LEU may cause significant variability in our operating results period over period.

Previous wording

Revenue from the Technical Solutions segment was $21.8 million and $20.1 million for the three months ended March 31, 2025 and 2024, respectively, an increase of $1.7 million (or 8%). The increase in revenue is primarily attributable to a $2.0 million increase in revenue generated by the HALEU Operation Contract. Revenue from the HALEU Operation Contract is recorded on a cost-plus-incentive-fee basis and includes a target fee for Phase 2 of the contract.

Current wording

Revenue from the Technical Solutions segment was $28.8 million and $19.4 million for the three months ended June 30, 2025 and 2024, respectively, an increase of $9.4 million (or 48%). The increase in revenue is primarily attributable to a $9.1 million increase in revenue generated by the HALEU Operation Contract, while the remaining increase is related to other contracts. Revenue from the HALEU Operation Contract is recorded on a cost-plus-incentive-fee basis and includes a target fee for Phase 2 of the contract.

Previous wording

Cost of sales for the LEU segment was $20.1 million and $23.1 million for the three months ended March 31, 2025 and 2024, respectively, a decrease of $3.0 million (or 13%). SWU costs decreased as a result of a 48% decrease in the average unit cost of SWU sold, partially offset by a 49% increase in the volume of SWU sold. Cost of sales for the three months ended March 31, 2025 and 2024, included $2.1 million and $0.3 million, respectively, for the revaluation of inventory loans.

Current wording

Cost of sales for the LEU segment was $75.0 million and $136.6 million for the three months ended June 30, 2025 and 2024, respectively, a decrease of $61.6 million (or 45%). SWU costs decreased as a result of a 27% decrease in the volume of SWU sold and an 8% decrease in the average unit cost of SWU sold. Uranium costs decreased primarily as a result of a decrease in the volume of uranium sold. Cost of sales for both the three months ended June 30, 2025 and 2024, included $1.5 million for the revaluation of inventory loans.

Previous wording

Gross profit for the LEU segment was $31.2 million and $0.5 million for the three months ended March 31, 2025 and 2024, respectively, an increase of $30.7 million (or 6,140%). LEU customers generally have multi-year contracts that carry annual purchase commitments, not quarterly commitments. The gross profit in our LEU business varies based upon the timing of those contracts. The pricing applied to deliveries varies depending upon the market conditions at the time the contract was signed. The increase for the three months ended March 31, 2025 was due to the increase in sales volume and composition of contracts in the current quarter.

Current wording

Gross profit for the LEU segment was $50.7 million and $33.0 million for the three months ended June 30, 2025 and 2024, respectively, an increase of $17.7 million (or 54%). LEU customers generally have multi-year contracts that carry annual purchase commitments, not quarterly commitments. The gross profit in our LEU business varies based upon the timing of those contracts. The pricing applied to deliveries varies depending upon the market conditions at the time the contract was signed. The increase for the three months ended June 30, 2025 was due to the composition of contracts in the current quarter, compared to the prior quarter.

Previous wording

Gross profit for the Technical Solutions segment was $1.7 million and $3.8 million for the three months ended March 31, 2025 and 2024, respectively, a decrease of $2.1 million (or 55%). The decrease was primarily attributable to the factors discussed above. Because of the delay in completing Phase 2 of the HALEU Operation Contract, in November 2024, DOE extended Phase 2 to June 30, 2025. Costs incurred subsequent to the extension have not yet been subject to a fee, but Centrus expects the fee to be recovered later this year once the extension is definitized.

Current wording

Gross profit for the Technical Solutions segment was $3.2 million and $3.5 million for the three months ended June 30, 2025 and 2024, respectively, a decrease of $0.3 million (or 9%). The decrease was primarily attributable to the factors discussed above. Because of the delay in completing Phase 2 of the HALEU Operation Contract, in November 2024, DOE extended the Phase 2 period of performance to June 30, 2025. Costs incurred subsequent to the extension have not yet been subject to a fee as this portion of Phase 2 remains undefinitized and is subject to negotiation.

Previous wording

Revenue from the LEU segment was $51.3 million and $23.6 million for the three months ended March 31, 2025 and 2024, respectively, an increase of $27.7 million (or 117%). SWU revenue increased by $27.7 million as a result of a 46% increase in the average price of SWU sold and a 49% increase in the volume of SWU sold.

Current wording

Revenue from the LEU segment was $177.0 million and $193.2 million for the six months ended June 30, 2025 and 2024, respectively, a decrease of $16.2 million (or 8%). Uranium revenue decreased by $29.9 million as a result of a decrease in the volume of uranium sold. SWU revenue increased by $13.7 million as a result of a 24% increase in the average price of SWU sold, partially offset by a 12% decrease in the volume of SWU sold.

Previous wording

Cost of sales for the Technical Solutions segment was $20.1 million and $16.3 million for the three months ended March 31, 2025 and 2024, respectively, an increase of $3.8 million (or 23%). The increase is primarily attributable to a $4.1 million increase in costs incurred under the HALEU Operation Contract, partially offset by a decrease in costs related to other contracts.

Current wording

Cost of sales for the Technical Solutions segment was $45.7 million and $32.2 million for the six months ended June 30, 2025 and 2024, respectively, an increase of $13.5 million (or 42%). The increase is primarily attributable to a $13.8 million increase in costs incurred under the HALEU Operation Contract, partially offset by a decrease in costs related to other contracts.

Previous wording

Interest expense was $3.4 million and $0.4 million for the three months ended March 31, 2025 and 2024, respectively, an increase of $3.0 million (or 750%). This increase was due primarily to interest incurred on the 2.25% Convertible Notes issued in November 2024.

Current wording

Interest expense was $3.1 million and $0.3 million for the three months ended June 30, 2025 and 2024, respectively, an increase of $2.8 million (or 933%). This increase was due primarily to interest incurred on the 2.25% Convertible Notes issued in November 2024.

Previous wording

Investment income was $7.3 million and $2.8 million for the three months ended March 31, 2025 and 2024, respectively, an increase of $4.5 million (or 161%). The Company’s investment income represents interest earned on operating cash, which is primarily held in money market accounts. The increase was due primarily to a higher cash balance driven by the proceeds from the issuance of the 2.25% Convertible Notes issued in November 2024.

Current wording

Investment income was $8.0 million and $2.4 million for the three months ended June 30, 2025 and 2024, respectively, an increase of $5.6 million (or 233%). The Company’s investment income represents interest earned on operating cash, which is primarily held in money market accounts. The increase was due primarily to a higher cash balance driven by the proceeds from the issuance of the 2.25% Convertible Notes issued in November 2024.

Previous wording

Advanced technology costs were $3.0 million and $5.7 million for the three months ended March 31, 2025 and 2024, respectively, a decrease of $2.7 million (or 47%). Advanced technology costs consist of American Centrifuge work and related expenses that are outside of our customer contracts in the Technical Solutions segment, including bid and proposal activities and work to improve our centrifuge manufacturing capability.

Current wording

Advanced technology costs were $6.3 million and $9.8 million for the six months ended June 30, 2025 and 2024, respectively, a decrease of $3.5 million (or 36%). Advanced technology costs consist of American Centrifuge work and related expenses that are outside of our customer contracts in the Technical Solutions segment, including bid and proposal activities and work to improve our centrifuge manufacturing capability.

Previous wording

Pursuant to the a redemption notice, on March 26, 2025, the Company redeemed all 8.25% Notes at a redemption price equal to 100% of the principal amount, together with any accrued and unpaid interest. The Company recorded a gain of $11.8 million related to the extinguishment of the 8.25% Notes in the three months ended March 31, 2025.

Current wording

Pursuant to the a redemption notice, on March 26, 2025, the Company redeemed all 8.25% Notes at a redemption price equal to 100% of the principal amount, together with any accrued and unpaid interest. The Company recorded a gain of $11.8 million related to the extinguishment of the 8.25% Notes in the six months ended June 30, 2025.

Previous wording

Income tax expense (benefit) was $8.0 million and ($2.3) million for the three months ended March 31, 2025 and 2024, respectively, a change of $10.3 million (or 448%). Income tax expense (benefit) for both periods resulted from applying the annual effective tax rate to the quarterly income (loss) from continuing operations adjusted for discrete items. For more information about the valuation allowance, see Note 14, Income Taxes, in our Consolidated Financial Statements on our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

Income tax expense was $16.5 million and $6.6 million in the six months ended June 30, 2025 and 2024, respectively, an increase of $9.9 million (or 150%). Income tax expense for both periods resulted from applying the annual effective tax rate to the quarterly income from continuing operations adjusted for discrete items. For more information about the valuation allowance, see Note 14, Income Taxes, in our Consolidated Financial Statements on Form 10-K for the year ended December 31, 2024.

Previous wording

Net income (loss) netted to income of $27.2 million and a loss of $6.1 million for the three months ended March 31, 2025 and 2024, respectively, a change of $33.3 million (or 546%). The change of $33.3 million was primarily attributable to an increase of $30.7 million in gross profit from the LEU segment, a gain of $11.8 million on the extinguishment of long-term debt, an increase of $4.5 million in investment income, and a decrease of $2.7 million in advanced technology costs. This was partially offset by an increase of $3.0 million in interest expense and a decrease of $2.1 million in gross profit from the Technical Solutions segment.

Current wording

Net income was $56.1 million and $24.5 million in the six months ended June 30, 2025 and 2024, respectively, an increase of $31.6 million (or 129%). The increase was primarily attributable to an increase of $46.0 million in gross profit, as discussed above, a gain of $11.8 million on the extinguishment of long-term debt, and an increase of $10.1 million in investment income. This was partially offset by an increase of $18.1 million in nonoperating components of net periodic benefit expense, an increase of $9.9 million in income tax expense, and an increase of $5.8 million in interest expense.

Previous wording

As of March 31, 2025, the Company had a consolidated cash and cash equivalents balance of $653.0 million. In addition, the Company had $29.8 million of restricted cash related to three inventory loans, which required a cash deposit into an escrow fund. In May 2025, $18.6 million of the restricted cash was released from escrow, following the repayment of two of the three inventory loans in March 2025. See Note 3, Cash, Cash Equivalents, and Restricted Cash of the Consolidated Financial Statements. The Company anticipates having adequate liquidity to support our business operations for at least the next 12 months from the date of this Quarterly Report on Form 10-Q. Our view of liquidity is dependent on, among other things, conditions affecting our operations, including market, international trade restrictions, sanctions and other conditions, the impact of the May 2024 enactment of the Import Ban Act and our ability to obtain additional waivers thereunder, the impact of the November 2024 Russian Decree and the ability of TENEX to secure export licenses thereunder, the level of expenditures and government funding for our services contracts, and the timing of customer payments. Liquidity requirements for our existing operations are affected primarily by the timing and amount of customer sales and our inventory purchases.

Current wording

As of June 30, 2025, the Company had a consolidated cash and cash equivalents balance of $833.0 million. In addition, the Company had $11.2 million of restricted cash related to one of three initial inventory loans, which required a cash deposit into an escrow fund. In May 2025, $18.6 million of the restricted cash was released from escrow, following the repayment of two of the three inventory loans in March 2025. In July 2025, the remaining $11.2 million of the restricted cash was released from escrow, following the repayment of the last of the three inventory loans in June 2025. See Note 3, Cash, Cash Equivalents, and Restricted Cash of the Consolidated Financial Statements. The Company anticipates having adequate liquidity to support our business operations for at least the next 12 months from the date of this Quarterly Report on Form 10-Q. Our view of liquidity is dependent on, among other things, conditions affecting our operations, including market, international trade restrictions, sanctions and other conditions, the impact of the May 2024 enactment of the Import Ban Act and our ability to obtain additional waivers thereunder, the impact of the November 2024 Russian Decree and the ability of TENEX to secure export licenses thereunder, the level of expenditures and government funding for our services contracts, and the timing of customer payments. Liquidity requirements for our existing operations are affected primarily by the timing and amount of customer sales and our inventory purchases.

Previous wording

On November 10, 2022, the Company was awarded the HALEU Operation Contract. The HALEU Operation Contract provides for a 50/50 cost-share contract for Phase 1 of the base contract to complete the cascade, begin operations and produce the initial, small quantity demonstration HALEU. Phase 2 includes continued operations and maintenance on a cost-plus-incentive-fee basis. Finally, the HALEU Operation Contract includes options for the government to unilaterally extend performance for up to an additional nine years comprised of three options of three years each, also on a cost-plus-incentive-fee basis. The Company also is performing additional work on infrastructure and facility repairs and costs associated with 5B Cylinder refurbishment under the DOE’s technical direction. On November 5, 2024, the HALEU Operation Contract Phase 2 period of performance was extended to June 30, 2025. DOE has increased the Phase 2 contract value and related funding to approximately $152.3 million. The Company’s goal is to modularly scale up the facility as demand for HALEU grows in the commercial and government sectors, subject to the availability of funding and/or contracts to purchase the output of the plant.

Current wording

On November 10, 2022, the Company was awarded the HALEU Operation Contract. The HALEU Operation Contract provides for a 50/50 cost-share contract for Phase 1 of the base contract to complete the cascade, begin operations and produce the initial, small quantity demonstration HALEU. Phase 2 includes continued operations and maintenance on a cost-plus-incentive-fee basis. Finally, the HALEU Operation Contract includes options for the government to unilaterally extend performance for up to an additional nine years comprised of three options of three years each, also on a cost-plus-incentive-fee basis. The Company also is performing additional work on infrastructure and facility repairs and costs associated with 5B Cylinder refurbishment under either the DOE Contracting Officer’s approval or contract modifications. On November 5, 2024, the HALEU Operation Contract Phase 2 period of performance was extended to June 30, 2025. DOE has increased the Phase 2 contract value and related funding to approximately $169.1 million. On June 17, 2025, the DOE exercised Option 1a of Phase 3 of the HALEU Operation Contract and extended the period of performance to June 30, 2026. The Company’s goal is to modularly scale up the facility as demand for HALEU grows in the commercial and government sectors, subject to the availability of funding and/or contracts to purchase the output of the plant.

Previous wording

Further, any sanctions or other restrictions, including the Import Ban Act banning LEU imports from Russia and the Russian Decree prohibiting LEU exports out of Russia in the absence of a license, represent a significant risk to our business as we currently rely on the TENEX Supply Contract as a significant supply source to meet our delivery obligations. Such restrictions on LEU imports to the U.S. or exports from Russia could have a material impact on our operations and liquidity. For further discussion, please see Part I, Item 1A, Risk Factors.

Current wording

Further, any sanctions or other restrictions, including the Import Ban Act banning LEU imports from Russia and the Russian Decree prohibiting LEU exports out of Russia in the absence of a license, represent a significant risk to our business as we rely on the TENEX Supply Contract as a significant supply source to meet our delivery obligations. Such restrictions on LEU imports to the U.S. or exports from Russia could have a material impact on our operations and liquidity. For further discussion, please see Part I, Item 1A, Risk Factors.

Previous wording

Capital expenditures of approximately $23.3 million are anticipated over the next 12 months.

Current wording

Capital expenditures of approximately $44.7 million are anticipated over the next 12 months.

Previous wording

The Qualifying Advanced Energy Project Credit (“§48C”) was established by the American Recovery and Reinvestment Act of 2009 and renewed and expanded under the IRA. The Qualifying Advanced Energy Project Credit (“§48C”) program aims to strengthen U.S. industrial competitiveness and clean energy supply chains. As the nation builds a net-zero economy, the §48C tax credit program aims to play a critical role to create high-quality jobs, reduce industrial emissions, and increase domestic production of critical clean energy products and materials. The IRA provided $10.0 billion in new funding under §48C(e), with at least $4.0 billion reserved for projects in certain energy communities with closed coal mines or retired coal-fired power plants, to allocate credits to projects in three categories: (1) Clean energy manufacturing and recycling, (2) industrial decarbonization, and (3) critical materials refining, processing, and recycling.

Current wording

The Qualifying Advanced Energy Project Credit (“§48C”) was established by the American Recovery and Reinvestment Act of 2009 and renewed and expanded under the IRA. The §48C program aims to strengthen U.S. industrial competitiveness and clean energy supply chains. As the nation builds a net-zero economy, the §48C tax credit program aims to play a critical role to create high-quality jobs, reduce industrial emissions, and increase domestic production of critical clean energy products and materials. The IRA provided $10.0 billion in new funding under §48C(e), with at least $4.0 billion reserved for projects in certain energy communities with closed coal mines or retired coal-fired power plants, to allocate credits to projects in three categories: (1) Clean energy manufacturing and recycling, (2) industrial decarbonization, and (3) critical materials refining, processing, and recycling.

Previous wording

On October 18, 2024, the Company submitted an application for a clean energy manufacturing and recycling project associated with re-equipping our manufacturing property at our manufacturing facility in Oak Ridge. This would recreate a viable enrichment supply chain and allow ACO to manufacture centrifuge parts to be used in centrifuge machines to enrich uranium. Our application requested an allocation of $62.4 million based on a qualified investment in eligible property of $208.0 million made by Centrus. On January 10, 2025, the Company was informed that the IRS granted our request for a $62.4 million credit allocation for this facility. Centrus now has two years from that date to provide evidence that the requirements of the credit have been met thus certifying our credit allocation. Upon certification of our credit allocation, we then have two years from that date to notify the DOE that the qualified investment in eligible property is placed in service to receive the credit allocation.

Current wording

On October 18, 2024, the Company submitted an application for a clean energy manufacturing and recycling project associated with re-equipping our manufacturing property at our manufacturing facility in Oak Ridge. This would recreate a viable enrichment supply chain and allow ACO to manufacture centrifuge parts to be used in centrifuge machines to enrich uranium. Our application requested an allocation of $62.4 million based on a qualified investment in eligible property of $208.0 million made by Centrus. On January 10, 2025, the Company was informed that the IRS granted our request for a $62.4 million credit allocation for this facility. Centrus now has two years from that date to provide evidence that the requirements of the credit have been met thus certifying our credit allocation. Upon certification of our credit allocation, the Company then has two years from that date to notify the DOE that the qualified investment in eligible property is placed in service to receive the credit allocation.

Previous wording

On May 28, 2024, the Company entered into an agreement with an insurer (“Insurer”) for two of its defined benefit plans to purchase a group annuity contract and transferred approximately $234.0 million of its pension plan obligations to the insurer. The purchase of the group annuity contract was funded directly by the assets of the pension plan of approximately $224.0 million. The purchase resulted in a transfer of future benefit obligations and administrative responsibilities for more than 1,000 beneficiaries effective September 1, 2024.

Current wording

On May 28, 2024, the Company entered into an agreement with an insurer for two of its defined benefit plans to purchase a group annuity contract and transferred approximately $234.0 million of its pension plan obligations to the insurer. The purchase of the group annuity contract was funded directly by the assets of the pension plan of approximately $224.0 million. The purchase resulted in a transfer of future benefit obligations and administrative responsibilities for more than 1,000 beneficiaries effective September 1, 2024.

Previous wording

For the three months ended March 31, 2025, net cash provided by operating activities was $36.5 million. The net increase was primarily due to approximately $123.0 million in cash collected from customers and investment income. These cash inflows were partially offset by approximately $87.0 million of disbursements for operations, of which approximately $59.0 million relates to both payments for LEU inventory deliveries and cash outflows for the Technical Solutions segment, with the remaining disbursements being for corporate administration, benefits claims, and advanced technology costs.

Current wording

For the six months ended June 30, 2025, net cash provided by operating activities was $89.3 million. The net increase was primarily due to approximately $214.0 million in cash collected from customers and investment income. These cash inflows were partially offset by approximately $125.0 million of disbursements for operations, of which approximately $85.0 million relates to both payments for LEU inventory deliveries and cash outflows for the Technical Solutions segment, with the remaining disbursements being for corporate administration, benefits claims, and advanced technology costs.

Previous wording

For the three months ended March 31, 2024, net cash provided by operating activities was $5.3 million. The net increase was primarily due to approximately $81.0 million in cash collected from customers, investment income, and reimbursements for postretirement health and life benefits paid by the Company. These cash inflows were partially offset by approximately $76.0 million of disbursements for operations, of which approximately $52.0 million relates to payments for LEU inventory deliveries and cash outflows for the Technical Solutions segment, with the remaining disbursements being for corporate administration, benefits claims, and advanced technology costs.

Current wording

For the six months ended June 30, 2024, net cash provided by operating activities was $12.3 million. The net increase was primarily due to approximately $199.0 million in cash collected from customers, investment income, and reimbursements for postretirement health and life benefits paid by the Company. These cash inflows were partially offset by approximately $187.0 million of disbursements for operations, of which approximately $143.0 million relates to payments for LEU inventory deliveries and cash outflows for the Technical Solutions segment, with the remaining disbursements being for corporate administration, benefits claims, and advanced technology costs.

Previous wording

For the three months ended March 31, 2025 and 2024, cash of $25.2 million and $7.1 million, respectively, was provided from the net proceeds related to the issuance of 258,197 and 176,628 shares, respectively, of Class A Common Stock under ATM offerings.

Current wording

For the six months ended June 30, 2025 and 2024, cash of $139.9 million and $19.0 million, respectively, was provided from the net proceeds related to the issuance of 1,415,924 and 451,830 shares, respectively, of Class A Common Stock under ATM offerings.

Previous wording

Pursuant to the Redemption Notice, on March 26, 2025, the Company redeemed all 8.25% Notes at a redemption price equal to 100% of the principal amount of $74.3 million, together with any accrued and unpaid interest. For the three months ended March 31, 2025 and 2024, payments of $3.5 million and $3.1 million, respectively, of interest classified as debt are classified as a financing activity. Refer to Note 6, Debt, of the Consolidated Financial Statements regarding the accounting for the 8.25% Notes.

Current wording

Pursuant to the Redemption Notice, on March 26, 2025, the Company redeemed all 8.25% Notes at a redemption price equal to 100% of the principal amount of $74.3 million, together with any accrued and unpaid interest. For the six months ended June 30, 2025 and 2024, payments of $3.5 million and $3.1 million, respectively, of interest classified as debt are classified as a financing activity. Refer to Note 6, Debt, of the Consolidated Financial Statements regarding the accounting for the 8.25% Notes.