BETHESDA, Md. – Centrus Energy Corp. (NYSE MKT: LEU) announced today that it has reached agreement with TENEX to modify the terms of the long-term supply contract the two companies signed in 2011 and to extend their contractual relationship through 2026.
See presser for more.
I'm wondering how much of the stuff will come from Iran via Tenex.
"Again...next 10 years relies on margins on Russia price vs Centrus Retail price."
Anybody who thinks Centrus has a ten-year life expectancy should be buying the bonds hand over fist. Yesterday the bonds traded in only once, a broker-to-broker transaction at 13 (that's $130 per $1,000 bond for anybody not hip to the way bonds are quoted).
These bonds pay a cash yield of 5% plus a payment in kind (PIK) of 3% of the bonds themselves based on their $1,000 face value. With the bonds trading at 13, the PIK has a value of about 0.4% annual cash equivalent yield.
So, at 5.4% and selling at $13, the bonds have an annual current yield of 41.5%. A new bond owner would get all her money back in the first five semi-annual interest payments. That is, two-and-a-half years.
Using a little advanced logic, I believe that 2.5 is
Centrus to earn a modicum of profit on its continuing arrangement to manage the facilities and continue the research.
What's the value of the debt? Maybe ten cents on the dollar at most?
Seems like the believers ought to buy out the non-believers (even at a premium to the market) and give the Company a chance at survival. But, I know, creditors never think that way.
a steal in my humble opinion. Again, IF! CUSIP 15643UAA2.
Disclosure: I am the long-suffering owner of both.
Here we go, from the Company's presser today: "Centrus Energy Corp. (NYSE MKT: LEU) announced today that the text of 2016 Omnibus Appropriations legislation under consideration by Congress authorizes a total of $100 million in continued funding to the U.S. Department of Energy to maintain and advance American leadership in uranium enrichment technology. This includes $50 million in direct appropriations, which the Department had previously stated it would use to support critical centrifuge research and testing at Centrus' facilities in Oak Ridge, Tennessee. The legislation also authorizes the Department to continue operating America's only industrial-scale cascade of advanced centrifuges – located in Piketon, Ohio – by providing authority to use an additional $50 million from other accounts in the Department's budget."
That's a headline from the Washington Times.
I'm wondering how much pork the Ohio delegation brought home for ACP.
That's a pretty sad story. The question now is whether CLF is a long-term buy. CLF now trades for less than two times next year's projected operating cash flow. I own it and MSB too. Sheesh! What's the floor?
Regrettably I didn't follow their advice and stay away. LG insulted them and he was wrong. Let's see if he is man enough to admit it.
For the record, I just bought more at $2.05. MSB too at $5.19.
No guts, no air medal.
Who can ever explain the shallow thinking of these Socialists?
What assurances are there that the Russians won't resell it to Centrus?
None, I presume. So why didn't Moniz just make a deal for us to purchase it directly from the Iranians?
Maybe I'm just too cynical?
The market cap of the common is only $3 million. So you're saying that the market value of the debt is at least $3.997 billion? No way. Maybe you need to understand the meaning of enterprise value a little better.
Lot's of distributors fulfill a need in the marketplace. My question is, if Centrus never returns to the refinement business, could it possibly survive and prosper as a conduit between the refiners and the nuclear power customers.
i am a total hypocrite on this. I think global warming is a bunch of bunk but am for anything that bails me out of this.
If the Company can survive for four more years and refi the debt I will be one happy camper, but not 'til then. Bonds are currently at 17, so the market is saying it's unlikely.
Let's just say that Sponge Bob is unprincipled.
"Dex has said that it may file for bankruptcy to execute whatever agreement it reaches with lenders. "Dex Lenders Forbear Until Dec. 14 -- Market Talk," at 12:36 ET, incorrectly said that Dex said it will file for bankruptcy."
Think about that. With the bonds now trading at under 19, the whole enterprise has about the value of a nice roadside hotel. Four billion dollars invested.
Spin it any way you want.