Cameco Corp. (CCJ)

BUSINESS SUMMARY
Cameco Corporation engages in the exploration, development, mining, refining, and conversion of uranium that is used as fuel for generating electricity in nuclear power reactors worldwide. It operates four uranium mines in Canada and the United States, as well as two uranium mines under development in Canada and central Asia. The company also involves in the refining and conversion of uranium concentrate, and the purchase and sale of conversion services. Cameco operates as a commercial converter of uranium concentrates to uranium hexafluoride or uranium dioxide, a commercial supplier of services to convert uranium concentrates to uranium dioxide in the western world, and a supplier of fuel fabrication services for CANDU reactors. In addition, it engages in the generation and sale of electricity, as well as in the exploration, mining, milling, and sale of gold. The company generates electricity through its 31.6% interest in the Bruce Power Limited Partnership, which operates the four Bruce B nuclear reactors in Ontario. Cameco owns 52.7% of Centerra Gold, Inc., which owns 100% interest in the Kumtor gold mine in the Kyrgyz Republic and 95% interest in the Boroo gold mine in Mongolia. Centerra Gold also has interests in exploration properties, including a 100% interest in the Gatsuurt property in Mongolia and a 62% joint-venture interest in the REN property in Nevada. The company was founded in 1987 and is headquartered in Saskatoon, Canada.

Vision

Cameco will be a dominant nuclear energy company producing uranium fuel and generating clean electricity.

Strategy

Cameco’s strategy is to build on our solid asset base in uranium and uranium conversion, and expertise in the global nuclear industry with sustainable investments to provide clean-energy solutions for growing world markets. Our measures of success are a safe, healthy and rewarding workplace, a clean environment, supportive communities wherever we operate, and increasing return to shareholders.

Strength

In the past five years, Cameco generated more than $1 billion in cash flow and our net debt-to-capitalization ratio is about 5%. Outstanding operating performance and conservative financial stewardship have given us an excellent credit rating that allows us the flexibility to pursue opportunities for growth.

Market Potential Industry Information

Growing demand for electricity and concern over greenhouse gas emissions are fuelling a rediscovery of nuclear as a clean, reliable and affordable source of baseload electricity.

Existing uranium supply is expected to fall short of demand over the next decade demonstrating a need for new primary mine production which will require higher sustained prices. Cameco is positioned to benefit from this shortfall through our control of more than 50% of all identified new uranium production that may come to the market over the next 10 years.

VALUATION MEASURES
Market Cap (intraday): 13.76B
Enterprise Value (13-Jan-07)3: 13.90B
Trailing P/E (ttm, intraday): 38.42
Forward P/E (fye 31-Dec-07) 1: 26.22
PEG Ratio (5 yr expected): N/A
Price/Sales (ttm): 8.59
Price/Book (mrq): 5.93
Enterprise Value/Revenue (ttm)3: 8.72
Enterprise Value/EBITDA (ttm)3: 30.035
FINANCIAL HIGHLIGHTS
Fiscal Year
Fiscal Year Ends: 31-Dec
Most Recent Quarter (mrq): 30-Sep-06
Profitability
Profit Margin (ttm): 23.52%
Operating Margin (ttm): 16.24%
Management Effectiveness
Return on Assets (ttm): 4.44%
Return on Equity (ttm): 17.53%
Income Statement
Revenue (ttm): 1.59B
Revenue Per Share (ttm): 4.55
Qtrly Revenue Growth (yoy): 26.50%
Gross Profit (ttm): 378.51M
EBITDA (ttm): 462.95M
Net Income Avl to Common (ttm): 375.02M
Diluted EPS (ttm): 1.02
Qtrly Earnings Growth (yoy): -8.70%
Balance Sheet
Total Cash (mrq): 408.93M
Total Cash Per Share (mrq): 1.161
Total Debt (mrq): 609.90M
Total Debt/Equity (mrq): 0.264
Current Ratio (mrq): 3.115
Book Value Per Share (mrq): 6.561
Cash Flow Statement
Operating Cash Flow (ttm): 428.52M
Levered Free Cash Flow (ttm): -164.03M