Cameco Annual Report 2011
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Outlook for 2012

Over the next several years, we expect to invest significantly in expanding production at existing mines and advancing projects as we pursue our growth strategy. The projects are at various stages of development, from exploration and evaluation to construction.

We expect our existing cash balances and operating cash flows will meet our anticipated capital requirements without the need for significant additional funding. Cash balances will decline as we use the funds in our business and pursue our growth plans.

Our outlook for 2012 reflects the growth expenditures necessary to help us achieve our strategy. We do not provide an outlook for the items in the table that are marked with a dash.

See Financial results by segment for details.

2012 Financial outlook

  Consolidated Uranium Fuel services Electricity
  1. (1) Based on a uranium spot price of $52.00 (US) per pound (the Ux spot price as of February 6, 2012), a long-term price indicator of $61.00 (US) per pound (the Ux long-term indicator on January 30, 2012) and an exchange rate of $1.00 (US) for $1.00 (Cdn).
  2. (2) This increase is based on the unit cost of sale for produced material and committed long-term purchases. If we decide to make discretionary purchases in 2012 then we expect the average unit cost of sales to increase further.
  3. (3) Direct administration costs do not include stock-based compensation expenses. See here for more information.
  4. (4) Does not include our share of capital expenditures at BPLP.
Production – 21.7 million lbs 13 to 14 million kgU –
Sales volume – 31 to 33 million lbs Decrease 10% to 15% –
Capacity factor – – – 95%
Revenue
compared to 2011		 Decrease
0% to 5%		 Decrease
0% to 5%1		 Decrease
10% to 15%		 Increase
5% to 10%
Average unit cost of
sales (including D&A)		 – Increase 0% to 5%2 Increase
10% to 15%		 Decrease
5% to 10%
Direct administration
costs compared
to 20113		 Increase
10% to 15%		 – – –
Exploration costs
compared
to 2011		 – Increase
15% to 20%		 – –
Tax rate Recovery of 0% to 5% – – –
Capital expenditures $620 million4 – – $80 million

Sensitivity analysis

For 2012:

  • a change of $5 (US) per pound in each of the Ux spot price ($52.00 (US) per pound on February 6, 2012) and the Ux long-term price indicator ($61.00 (US) per pound on January 30, 2012) would change revenue by $68 million and net earnings by $55 million.
  • a change of $5/MWh in the electricity spot price would change our 2012 net earnings by $4 million based on the assumption that the spot price will remain below the floor price of $50.18/MWh provided for under BPLP's agreement with the Ontario Power Authority (OPA).