CAMECO CORPORATION (Reuters) - Cameco Corp (>> Cameco Corp)
The stock fell more than 9 percent in Toronto trading to C$12.92, even though Cameco maintained its full-year guidance for deliveries and revenue.
Tokyo Electric Power (Tepco) (>> Tokyo Electric Power Company Holding Inc), the operator of Japan's wrecked Fukushima nuclear plant, scrapped its uranium supply contract with Cameco, the company said in February.
The Canadian company said its loss was also related to weak uranium prices amid a prolonged glut, tracing back to the 2011 tsunami in Japan which shut all of that country's nuclear reactors. A few have since restarted.
"We’re managing through the uncertainty, but even low-cost operations like ours, face pressure," Chief Executive Tim Gitzel said in a statement.
Spot prices of uranium, used to fuel nuclear reactors, dipped to a 13-year low late last year and have rebounded modestly in 2017.
"While the market will view the earnings miss as a negative, we point out that Cameco maintained its guidance across the board," said Rob Chang, analyst at Cantor Fitzgerald.
Its sales have historically been weighted to the last two quarters, when it is likely to get a higher price, he said.
The selloff looked like "nervous money" getting out of the stock, as the slumping uranium sector is slowly recovering, said Brian Madden, portfolio manager at Goodreid Investment Counsel, which owns the stock.
The industry continues to be oversupplied, but less so than previously, Madden said. The biggest global producer Kazatomprom[KZTPR.UL] said in January it would cut uranium output by 10 percent.
Cameco said severance costs and a strengthening Canadian dollar also weighed on its first-quarter results.
The net loss was C$18 million ($13 million), or 5 Canadian cents per share, in the first quarter, compared with a profit of C$78 million, or 20 Canadian cents per share, a year earlier.
Excluding items, the company lost 7 Canadian cents per share, bigger than the average analyst estimate of 1 Canadian cent, according to Thomson Reuters I/B/E/S.
Revenue at the Saskatoon, Saskatchewan-based company fell nearly 4 percent to C$393 million, with declines stemmed by high revenue from its Nukem unit, which is a nuclear fuel broker.
Analysts had expected revenue of C$372.345 million.
(Additional reporting by Muvija M in Bengaluru; Editing by Maju Samuel and Bernadette Baum)
By Swetha Gopinath and Rod Nickel
