Measuring our Results

Outstanding financial performance

2012 Objectives	Results
1 We use adjusted net earnings and cash flow from operations (before working capital changes) as a more meaningful way to compare our financial performance from period to period. These are not standard measures and not a substitute for financial information prepared in accordance with IFRS. Other companies may calculate these measures differently. Cash flow from operations (before working capital changes) is derived by adding amounts included in “Other operating items” to the line item “Net cash provided by operations” presented in the consolidated statements of cash flows in our 2012 audited financial statements. See Adjusted net earnings (Non-IFRS measures) on page 34 and note 26 to our audited financial statements for more information.
Production Achieve budgeted production from our uranium and fuel services segments.	Achieved Our share of U3O8 production was 21.9 million pounds, or 99% of plan, and we produced 14.2 million kgU at fuel services, or 99% of plan.
McArthur River Implement productivity improvements to maintain planned production during mining zone transitions.	Achieved Made productivity improvements on cycle times, and changed the sequencing of the raises in zone 2, panel 5. Mitigated the risk to production in 2013 associated with the transition to the upper mining area of zone 4.
Financial measures Corporate performance Achieve budgeted net earnings and cash flow from operations (before working capital changes).	Exceeded Adjusted net earnings1 were $447 million, 20% higher than budget. Cash flow from operations (before working capital changes)1 was $717 million, 22% higher than budget.
Costs Achieve budgeted unit operating costs and corporate support costs.	Achieved Actual consolidated unit operating costs were in line with budget. Unit operating costs for uranium were $20.46 or 3% higher than budget and unit operating costs for fuel services were 2% lower than our budget of $17.11 per kgU. For the purposes of calculating performance on this objective, unit costs are weighted 70% for uranium and 30% for fuel services. Direct administrative expenses (corporate support costs) at year-end were 3% better than budgeted costs of $168 million. Our minimum target was to achieve budgeted unit costs on a consolidated basis.
Growth Meet regulatory project milestones and stage gate assessments on projects that support our Double U growth strategy.	Achieved Licence renewal applications were submitted for McArthur River, Key Lake and Rabbit Lake sites. Draft Environmental Impact Statements were submitted for the Millennium project, Key Lake extension project, and Eagle Point water management. Licence renewals were received for Blind River refinery, Port Hope conversion facility and Cameco Fuel Manufacturing. Engineering, procurement and construction management (EPCM) approach rolled out for McArthur River expansion, Millennium and the Port Hope Vision in Motion projects, and EPCM negotiations completed and firms retained. In Q4, we adjusted our growth strategy down from 40 million to 36 million pounds U3O8 by 2018.
Cigar Lake Advance the project towards startup in 2013 by successfully completing critical activities planned for 2012.	Achieved Completed the sinking of shaft 2 to its final depth of 500 metres and began installing shaft infrastructure. Assembled the first jet boring system unit underground, moved it to a production tunnel and began preliminary commissioning and system testing. Cigar Lake is a challenging deposit to mine. Completion of these critical milestones requires careful planning and deliberate execution.
Inkai Advance block 3 mineral resource delineation drilling and complete the test leach facility.	Partially achieved Received regulatory approval for the detailed block 3 delineation and test leach work programs. Continued to advance block 3 mineral resource delineation, started technological drilling of test wellfields, continued infrastructure development and started construction of a test leach facility.
Receive approval to increase annual production from blocks 1 and 2 to design capacity of 5.2 million pounds per annum (100% basis). Continue to advance our longer-term objective of receiving approval to double annual production from blocks 1 and 2, extend the lease terms and secure block 3 mining rights.	Partially achieved We continue to await government approval of an amendment to the resource use contract to increase annual production from blocks 1 and 2 to 5.2 million pounds per year (100% basis). We signed a binding memorandum of agreement with our partner setting out the framework to increase annual production to 10.4 million pounds (100% basis), to extend the term of Inkai's resource use contract, and to co-operate on the development of uranium conversion capacity, with the primary focus on uranium refining. Implementation of the MOA in this complex and developing regulatory environment is subject to further agreements and receipt of all necessary Canadian and Kazakhstan government approvals.
Kintyre Continue to advance project evaluation in 2012 and decide if we will proceed to feasibility.	Achieved We drill tested ten additional prospective areas on the property in 2012 and no additional resources were identified. We completed the prefeasibility study and decided not to proceed with the feasibility study at this time due to challenging project economics.
Exploration and innovation Replace mineral reserves and resources at the rate of annual U3O8 production based on a three-year rolling average.	Achieved Over the last three years, mineral reserves decreased by 13.5 million pounds compared to production of 67.2 million pounds, measured and indicated resources increased by 104.4 million pounds and inferred resources decreased by 67 million pounds. On average, production was replaced and exceeded by nearly 8 million pounds per year in each of the last three years (2010 to 2012). Replacing our reserves and resources is fundamental to our long-term success.
Capital project management Deliver capital projects planned for completion in 2012 within budget and on schedule.	Partially achieved The 165 capital projects that closed in 2012 were on schedule but 11.9% over our budget of $300 million.

Safe, healthy and rewarding workplace

2012 Objectives	Results
Strive for no lost-time injuries at all Cameco-operated sites and, at a minimum, maintain a long-term downward trend in combined employee and contractor injury frequency and severity, and radiation doses.	Achieved Safety performance was strong in 2012 with a downward trend in lost-time frequency and severity with the best lost-time frequency performance in the company’s history at 0.13 versus a target of 0.29. Average radiation doses were low and stable.
Attract, retain, engage and develop employees in support of current and future operations, and establish succession pools for key positions.	Partially achieved Turnover rate of 7.5% was lower than the targeted performance range of 8.1% to 9.9%; but there was a higher than expected turnover rate for new hires within the first year of employment at 12.4%. Cameco was listed as both a Top 100 Employer and on the Financial Post’s 10 Best Companies to Work For, in addition to receiving awards for being among Saskatchewan’s top Employers, Canada’s Best Diversity Employers, and a Top Employer of Canadians over 40.

Clean environment

2012 Objectives	Results
Strive for zero reportable environmental incidents, reduce the frequency of incidents and have no significant incidents at Cameco-operated sites.	Achieved We incurred a total of 28 reportable environmental incidents in 2012, less than our long-term average of 40 reportable environmental incidents per year. There were no significant environmental incidents.

Supportive communities

2012 Objectives	Results
Develop long-term relationships by engaging with regulators and other stakeholders important to our sustainability. Secure continued support from our employees, impacted communities, investors, governments and the general public through communications, community investment and business development.	Achieved Maintained positive relationships with groups affected by our operating activities. Received a higher management credibility rating of 79% in our investor perception study compared to 74% in 2011. Maintained strong corporate trust ratings in Saskatchewan (7.52/10 compared to 7.24 in 2011) and Port Hope (8.03/10 compared to 7.98 in 2011); polling was not conducted in the US this year.
Implement Cameco’s corporate social responsibility policy to advance Cameco projects in all locations and secure support from indigenous communities affected by our operations.	Achieved A revised corporate social responsibility policy was developed and approved, and rollout to operations commenced as planned. Meetings in local communities in northern Saskatchewan, Nunavut, James Bay and Australia took place throughout the year. Successfully concluded the negotiation and signing of the Martu/Cameco Mining Development Agreement in Australia. Signed a collaboration agreement with the Northern Village of Pinehouse and Kineepik Metis Local Inc. in northern Saskatchewan. Negotiations are in progress with other communities in northern Saskatchewan.

2013 objectives

We set corporate, business unit and departmental objectives every year under our four measures of success, and these become the foundation for a portion of annual employee compensation.

Outstanding financial performance

• Achieve targeted adjusted net earnings and cash flow from operations.
• Execute capital projects within scope, on time and on budget.
• Achieve production at Cigar Lake in 2013, and advance other activities needed to achieve medium and long-term growth objectives.

Safe, healthy and rewarding workplace

• Improve workplace safety performance at all sites.
• Attract and retain the employees needed to support operations and growth.

Clean environment

• Improve environmental performance at all sites.

Supportive communities

• Build and sustain strong stakeholder support for our activities.