Fourth Quarter Consolidated Results

Net earnings

In the fourth quarter of 2013, our net earnings were $64 million ($0.16 per share diluted), an increase of $23 million compared to $41 million ($0.10 per share diluted) in 2012, mainly due to:

• the impact of a one-time $168 million write-down of our investment in the Kintyre project in the fourth quarter of 2012
• lower exploration and administrative expenditures
• higher income tax recovery

offset by:

• lower uranium gross profits due to lower sales volumes and higher average unit cost of sales
• a $70 million write-down of our Talvivaara asset, due to their weakened financial position and pending corporate restructuring
• higher losses on foreign exchange derivatives due to the weakening of the Canadian dollar

On an adjusted basis, our earnings this quarter were $150 million ($0.38 per share diluted) compared to $233 million ($0.59 per share diluted) (non-IFRS measure) in the fourth quarter of 2012, mainly due to:

• lower uranium gross profits due to lower sales volumes and higher average unit cost of sales

offset by:

• lower exploration and administrative expenditures
• higher income tax recovery

We use adjusted net earnings, a non-IFRS measure, as a more meaningful way to compare our financial performance from period to period. See non-IFRS measures for more information. The table below reconciles adjusted net earnings with our net earnings.

Administration

As a result of restructuring activities, direct administration costs were $45 million in the quarter, $8 million lower than the same period last year. Stock-based compensation expenses were $2 million higher than the fourth quarter of 2012. See note 27 to the financial statements.