Energy Fuels (TSE:EFR) reported a second-quarter net loss of $33.6 million as transaction and development spending weighed on results, while its uranium business generated $25 million in revenue, approximately $14 million in gross profit and a 57% gross margin.
President and Chief Executive Officer Ross Bhappu said the company is pursuing a strategy to build a vertically integrated rare earth supply chain, spanning mining, processing, separation, metallization, alloy production and magnet manufacturing. The company is advancing acquisitions of Australian Strategic Materials, or ASM, and Germany-based magnet producer Vacuumschmelze, or VAC.
Uranium operations and inventory
During the second quarter, Energy Fuels mined 365,000 pounds of uranium and produced more than 860,000 pounds of finished U3O8. The company ended June with 2.27 million pounds of uranium inventory.
Chief Financial Officer Nate Bennett said the White Mesa Mill produced about 1.7 million pounds of finished U3O8 in the first half of 2026, reaching Energy Fuels’ full-year production guidance range of 1.5 million to 2.5 million pounds ahead of schedule. The mill has entered a planned maintenance period, with uranium processing expected to restart in the fourth quarter of 2026 or early 2027.
Mining operations are continuing during the maintenance period. Energy Fuels maintained its expectation to mine more than 2 million pounds of contained U3O8 during 2026, with grades expected to improve during the second half as mining advances into higher-grade areas at the Pinyon Plain mine.
The company reported weighted average uranium production costs of approximately $23 per pound of recovered U3O8 during the processing campaign, at the low end of its prior $23-to-$30-per-pound range. Bennett said mining and transportation costs averaged about $14 per pound, while milling costs averaged about $9 per pound.
Finished uranium inventory carried an average cost of about $33.92 per pound at quarter-end, down from approximately $36 per pound at the end of the first quarter. Bennett attributed the reduction primarily to low-cost production from Pinyon Plain and said inventory costs are expected to continue falling as additional production moves through inventory.
Balance sheet and acquisition costs
At June 30, Energy Fuels had approximately $996 million of working capital and $1.53 billion of total assets. Bennett said the quarterly loss included approximately $10.7 million in acquisition- and integration-related expenses tied to the ASM and VAC transactions.
The company also recorded planned spending in its rare earth and heavy mineral sands businesses, including engineering, permitting, infrastructure development and organizational growth. Bhappu said Energy Fuels has access to several funding sources, including its balance sheet, potential government support and a $250 million Goldman Sachs term loan facility.
Energy Fuels announced conditional support for a $725 million loan from the U.S. Office of Strategic Capital. Bhappu said the company is completing legal documentation and other conditions associated with the facility. He said the company likely would not need to draw on the financing until early 2027, with initial potential uses including the Phase I-B and I-C expansion at White Mesa.
Bennett said the Phase I-B and I-C project is expected to cost $104 million, with about one-fourth of the spending anticipated in 2026 and the remainder in 2027.
Rare earth expansion and feedstock plans
Energy Fuels has begun construction on its Phase I-B and I-C rare earth expansion at the White Mesa Mill, including a circuit to process mixed rare earth carbonate, or MREC. Bhappu said the expansion is intended to allow simultaneous commercial-scale processing of uranium and rare earth materials, rather than requiring the company to choose between the two.
The company expects the facility to be able to produce heavy rare earth oxides, including dysprosium and terbium, in late 2027. Bhappu said Energy Fuels has completed pilot work on dysprosium and terbium and has moved on to gadolinium and potentially other heavy rare earth oxides.
Energy Fuels is also advancing a Phase II expansion at White Mesa. The company previously released a feasibility study describing capacity of more than 6,000 metric tons annually of neodymium-praseodymium oxide, about 300 metric tons of dysprosium oxide and 80 metric tons of terbium oxide. Permitting is underway, and the company plans to commission the facility in late 2029.
Bhappu said the company expects a final investment decision for its Donald Project as early as the third quarter of 2026, though he acknowledged that decision had been delayed while the company works on financing alternatives in Australia. If Donald is delayed, he said Energy Fuels could source monazite from its existing arrangement with Chemours, acquire MREC from third-party producers, or pursue supply discussions with heavy mineral sands producers.
The company is also seeking government approvals and an investment agreement in Madagascar for its Vara Mada project. At its Bahia project in Brazil, Energy Fuels restarted drilling after obtaining exploration permits in 2025 and expects a resource estimate later in 2026 or in early 2027.
ASM and VAC integration plans
Bhappu said ASM operates metals and alloy-making facilities that Energy Fuels expects to supply with its rare earth oxides. ASM’s Korean metals plant is operating and is being expanded with eight new furnaces, according to Bhappu. The company is also planning to expand strip-casting capabilities, with an objective of approximately doubling the facility’s current 12,000-to-14,000-ton annual capacity.
Following the planned VAC acquisition, Energy Fuels expects to supply VAC’s magnet manufacturing operations, including its 2,000-ton capacity facility in Sumter, South Carolina. Bhappu said the company anticipates increasing magnet-making capacity there sixfold to 12,000 tons annually through 2031.
“Our story is about execution,” Bhappu said, adding that the company is staging investments across mining, processing and magnet manufacturing over the next five years.
About Energy Fuels (TSE:EFR)
Energy Fuels is a leading U.S. -based critical materials company, focused on uranium, rare earth elements (REEs), heavy mineral sands, vanadium and medical isotopes. Energy Fuels, which owns and operates several conventional and in-situ recovery uranium projects in the western United States, has been the leading U.S. producer of natural uranium concentrate for the past several years, which is sold to nuclear utilities for the production of carbon-free nuclear energy. Energy Fuels also owns the White Mesa Mill in Utah, which is the only fully licensed and operating conventional uranium processing facility in the United States.
