Uranium One Inc. Condensed Consolidated Interim Financial Statements For the three and nine months ended September 30, 2013 (unaudited) (In U.S. dollars, tabular amounts in millions, except where indicated)
CONSOLIDATED INCOME STATEMENTS - UNAUDITED For the three and nine months ended September 30, 2013 and 2012 THREE MONTHS ENDED NINE MONTHS ENDED NOTES SEP 30, 2013 SEP 30, 2012 SEP 30, 2013 SEP 30, 2012 Revenues 41.0 8.5 58.1 26.8 Cost of sales Operating expense (14.8) (1.6) (19.8) (8.2) Depreciation (15.8) (1.5) (20.9) (4.8) Earnings from mine operations 10.4 5.4 17.4 13.8 Share of results from joint ventures 5 28.9 (39.2) 58.5 33.7 Revenues 179.8 134.1 348.3 308.5 Operating expense (77.9) (44.0) (149.6) (94.0) Depreciation (62.7) (36.7) (115.8) (80.1) Impairment - (90.2) - (90.2) Finance and other costs (2.0) (3.6) (8.7) 0.3 Income tax (8.3) 1.2 (15.7) (10.8) General and administrative (9.8) (11.8) (28.3) (33.0) Impairment 4.1 (67.8) - (67.8) - Exploration expense (0.5) (0.5) (2.0) (3.2) Care and maintenance (0.7) (0.4) (1.4) (1.3) Operating (loss) / earnings (39.5) (46.5) (23.6) 10.0 Finance income 4.6 0.9 14.9 4.0 Finance expense (49.8) (14.3) (93.6) (45.2) Foreign exchange gain / (loss) 25.2 (18.2) 49.6 (13.6) Corporate development expense (6.6) (0.2) (12.6) (2.6) Gain on business combination - 17.2-17.2 Other 2.7 0.1 7.3 (6.0) Loss before income taxes (63.4) (61.0) (58.0) (36.2) Current and deferred income tax (expense) / recovery (0.2) (0.6) (4.5) 8.3 Net loss (63.6) (61.6) (62.5) (27.9) Net earnings / (loss) per share Basic and diluted (0.07) (0.06) (0.07) (0.03) Weighted average number of shares (millions) Basic and diluted 959.2 957.2 957.9 957.2 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS) - UNAUDITED For the three and nine months ended September 30, 2013 and 2012 Other comprehensive income / (loss) for the period Items that may be reclassified subsequently to profit and loss THREE MONTHS ENDED NINE MONTHS ENDED NOTES SEP 30, 2013 SEP 30, 2012 SEP 30, 2013 SEP 30, 2012 Unrealized loss recognized on translation of foreign operations (20.6) (17.1) (42.7) (35.8) Realized foreign currency translation gain on business combination - 6.6-6.6 Unrealized fair value adjustments on available for sale securities - 0.1 - (0.1) Realized fair value reclassified to income statement (4.3) - (4.3) - Unrealized foreign exchange gain / (loss) on Ruble Bonds 1.9 (21.2) 29.7 (9.2) Unrealized fair value (loss)/gain on Ruble Bonds swap derivative 1.5 13.1 (30.1) (1.2) Total other comprehensive loss for the period (21.5) (18.5) (47.4) (39.7) Net loss (63.6) (61.6) (62.5) (27.9) Total comprehensive loss (85.1) (80.1) (109.9) (67.6) See accompanying notes to the condensed consolidated interim financial statements URANIUM ONE INC. Financial Statements 1
CONSOLIDATED BALANCE SHEETS - UNAUDITED AS AT SEP 30, 2013 AS AT DEC 31, 2012 NOTES ASSETS Current assets Cash and cash equivalents 482.3 430.7 Restricted cash 1,450.5 11.3 Dividends receivable 67.3 - Trade and other receivables 55.9 60.4 Inventories 3 25.8 25.6 Loans receivable 6 7.5 4.4 Other assets 7 17.4 22.0 2,106.7 554.4 Non-current assets Mineral interests, property, plant and equipment 4 218.3 277.9 Investment in associate 47.7 47.7 Investments in joint ventures 5 1,590.2 1,718.0 Loans receivable 6 91.3 73.3 Other assets 7 56.3 53.9 2,003.8 2,170.8 Total assets 4,110.5 2,725.2 LIABILITIES Current liabilities Trade and other payables 62.1 67.8 Current tax payable 8.1 - Interest bearing liabilities 8 1,464.9 3.0 Convertible debentures 3.1 - Other liabilities 10 1.8 12.0 1,540.0 82.8 Non-current liabilities Interest bearing liabilities 8 454.3 463.7 Convertible debentures 9 250.3 231.1 Provisions 72.2 63.6 Other liabilities 10 34.5 17.0 811.3 775.4 Total liabilities 2,351.3 858.2 EQUITY Share capital 5,325.4 5,325.4 Reserves 12 117.8 163.1 Deficit (3,684.0) (3,621.5) 1,759.2 1,867.0 Total equity and liabilities 4,110.5 2,725.2 Subsequent events see note 15 See accompanying notes to the condensed consolidated interim financial statements URANIUM ONE INC. Financial Statements 2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - UNAUDITED For the periods ended September 30, 2013, December 31, 2012 and September 30, 2012 NUMBER OF SHARE RESERVES SHARES CAPITAL (NOTE 12) DEFICIT TOTAL (millions) Balance as at January 1, 2013 957.2 5,325.4 163.1 (3,621.5) 1,867.0 Net loss for the period - - - (62.5) (62.5) Stock option expense - - 2.1-2.1 Exercise of warrants 7.0 - - - - Unrealized loss on translation of foreign operations - - (42.7) - (42.7) Realized fair value reclassified to income statement - - (4.3) - (4.3) Unrealized foreign exchange gain on Ruble Bonds - - 29.7-29.7 Unrealized fair value loss on Ruble Bonds swap derivative - - (30.1) - (30.1) Balance as at September 30, 2013 964.2 5,325.4 117.8 (3,684.0) 1,759.2 Balance as at January 1, 2012 957.2 5,325.4 193.0 (3,524.8) 1,993.6 Net loss for the period - - - (27.9) (27.9) Stock option expense - - 4.7-4.7 Unrealized loss on translation of foreign operations - - (35.8) - (35.8) Realized gain on business combination - - 6.6-6.6 Unrealized fair value adjustments on available for sale securities - - (0.1) - (0.1) Unrealized foreign exchange gain on Ruble Bonds - - (9.2) - (9.2) Unrealized fair value loss on Ruble Bonds swap derivative - - (1.2) - (1.2) Balance as at September 30, 2012 957.2 5,325.4 158.0 (3,552.7) 1,930.7 See accompanying notes to the condensed consolidated interim financial statements. URANIUM ONE INC. Financial Statements 3
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED For the three and nine months ended September 30, 2013 and 2012 THREE MONTHS ENDED NINE MONTHS ENDED NOTES SEP 30, 2013 SEP 30, 2012 SEP 30, 2013 SEP 30, 2012 Net loss (63.6) (61.6) (62.5) (27.9) Items not affecting cash: - Share of results from joint ventures (28.9) 39.2 (58.5) (33.7) - Depreciation 15.8 1.5 20.9 4.8 - Stock option expense 0.7 1.8 2.1 4.7 - Impairment 67.8-67.8 - - Finance income (4.6) (0.9) (14.9) (4.0) - Finance expense 41.7 14.3 85.5 45.2 - Gain on business combination - (17.2) - (17.2) - Unrealized foreign exchange (gain) / loss (17.1) 19.6 (41.5) 15.0 - Current income tax expense / (recovery) 0.2 0.6 4.5 (8.3) - Other 17.0 18.4 24.4 5.1 Movement in non-cash working capital 24.6 (22.0) 11.5 6.7 Operating cash flows before interest and tax 53.6 (6.3) 39.3 (9.6) Cash tax paid (1.0) (0.7) (2.8) (1.6) Cash interest paid (19.6) - (56.4) (27.5) Cash flows from / (used in) operating activities 33.0 (7.0) (19.9) (38.7) Additions of mineral interests, property, plant and equipment (10.4) (20.1) (36.8) (60.5) Mitsui withdrawal - 3.4-3.4 Cash receipts / (payments) for other assets (19.1) 9.2 (1.0) 7.7 Investment in associate - - - (150.0) Investment in restricted cash - - (1,450.0) - Redemption on letter of credit 8.4-8.4 - Joint venture charter capital contribution - - (9.0) (11.7) Loans to related parties (6.0) (11.2) (21.5) (28.7) Loans advanced to joint ventures 3.7-3.7 (3.5) Interest received 9.9 0.8 12.5 3.1 Dividends received 83.3 111.9 98.3 129.1 Cash flows from / (used in)) investing activities 69.8 94.0 (1,395.4) (111.1) Revolving loan facility issued, net of issue costs 8 - - 1,450.0 - Redemption of Ruble Bonds Series 1 (359.4) - (359.4) - Issue of Ruble Bonds Series 2 380.7-380.7 - Cash flows from financing activities 21.3-1,471.3 - Effects of exchange rate changes on cash and cash equivalents (6.6) (1.1) (4.4) (1.3) Net increase / (decrease) in cash and cash equivalents 117.5 85.9 51.6 (151.1) Cash and cash equivalents at the beginning of the period 364.8 323.8 430.7 560.8 Cash and cash equivalents at the end of the period 482.3 409.7 482.3 409.7 See accompanying notes to the condensed consolidated interim financial statements URANIUM ONE INC. Financial Statements 4
1 NATURE OF OPERATIONS Uranium One Inc. ( Uranium One, and together with its subsidiaries and joint ventures collectively, the Corporation ) is a Canadian corporation engaged through subsidiaries and joint ventures in the mining and production of uranium, and in the acquisition, exploration and development of properties for the production of uranium in Kazakhstan, the United States, Australia and Tanzania. The Corporation s head office address is 333 Bay Street, Suite 1710, Toronto, Ontario, Canada, M5H 2R2. Uranium One is a controlled company, with JSC Atomredmetzoloto ( ARMZ ), a Russian state-owned mining company, now owning 100% of the outstanding common shares. The Corporation had entered into a definitive agreement with ARMZ under which the Corporation would be taken private pursuant to a plan of arrangement, under which ARMZ, through an affiliate, would acquire all of the common shares that ARMZ and its affiliates do not already own for cash consideration of CDN$2.86 per share. The transaction was completed on October 18, 2013. In Kazakhstan, the Corporation holds a 70% interest in the Betpak Dala joint venture, which owns the Akdala and South Inkai Uranium Mines, a 50% interest in the Karatau joint venture, which owns the Karatau Uranium Mine, a 50% interest in the Akbastau joint venture, which owns the Akbastau Uranium Mine, a 49.67% interest in the Zarechnoye joint venture, which owns the Zarechnoye Uranium Mine, a 30% interest in the Kyzylkum joint venture, which owns the Kharasan Uranium Mine, and a 19% interest in the SKZ-U joint venture, a sulphuric acid plant near Kharasan as an additional source of sulphuric acid for its operations. In the United States, the Corporation owns the Willow Creek uranium mine and projects in the Powder River and Great Divide basins in Wyoming. The Corporation owns a 100% interest in the Honeymoon Uranium Project in Australia. The Corporation is the operator of the Mkuju River Project in Tanzania, and owns a 13.9% interest in Mantra Resources Pty Limited ( Mantra ), which owns the Mkuju River Project. The Corporation also owns, either directly or through joint ventures, uranium exploration properties in the western United States and South Australia. The unaudited condensed consolidated interim financial statements were approved on November 4, 2013 by the Corporation s Audit Committee on behalf of Board of Directors. 2 SIGNIFICANT ACCOUNTING POLICIES STATEMENT OF COMPLIANCE The unaudited condensed consolidated interim financial statements have been prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting. BASIS OF PREPARATION AND CONSOLIDATION The unaudited condensed consolidated interim financial statements, prepared in conformity with IAS 34, follow the same accounting principles and methods of application of the most recent annual consolidated financial statements, with the exception of the new accounting standards which are applicable beginning January 1, 2013 outlined below. Since the unaudited condensed consolidated interim financial statements do not include all disclosures required by the International Reporting Standards ( IFRS ) for annual financial statements, th ey should be read in conjunction with the Corporation s annual consolidated financial statements for the year ended December 31, 2012. FUNCTIONAL AND PRESENTATION CURRENCY The unaudited condensed consolidated interim financial statements are presented in US dollars. The functional currency of Uranium One Inc. is the US dollar. ADOPTION OF NEW INTERNATIONAL FINANCIAL REPORTING STANDARDS AND CHANGES IN ACCOUNTING POLICIES The following new IFRS has been applied for the first time in the current year: IFRS 10, Consolidated financial statements IFRS 10 replaces the consolidation requirements in IAS 27, Consolidated and Separate Financial Statements, and SIC-12 Consolidation - Special Purpose Entities. The adoption of this new standard had no impact on the Corporation s unaudited condensed consolidated interim financial statements. IFRS 11, Joint arrangements IFRS 11 supersedes IAS 31, Interests in Joint Ventures, and SIC-13, Jointly Controlled Entities - Non-Monetary Contributions by Venturers. Under IFRS 11, the Corporation classifies its interests in joint arrangements as either joint operations or joint ventures depending on the Corporation s rights to the assets and obligations for the liabilities of the arrangements. When making this assessment, the Corporation considers the structure of the arrangements, the legal form of any separate vehicles, the contractual terms of the arrangements and other facts and circumstances. Previously, the structure of the arrangement was the sole focus of classification. The Corporation has re-evaluated its involvement in its joint arrangements and has accounted for the investments as joint ventures. As a result the investments are now recognized by applying the equity method, compared to proportionate consolidation applied in the past. The change had a significant impact on the recognized assets and liabilities of the Corporation as well as the revenues, cost of sales and expenditures in the income statement presentation. The tables in note 14 summarize the adjustments made to the Corporation s comparative income statement and statements of cash flows. IFRS 12, Disclosure of interests in other entities IFRS 12 is a new and comprehensive standard on disclosure requirements for all forms of interests in other entities, including subsidiaries, joint arrangements, associates and unconsolidated structured entities. URANIUM ONE INC. Financial Statements 5
2 SIGNIFICANT ACCOUNTING POLICIES IFRS 13, Fair value measurement IFRS 13 is a new standard that defines fair value, sets out in a single IFRS framework for measuring fair value and requires disclosures about fair value measurements. IFRS 13 does not determine when an asset, a liability or an entity s own equity instrument is measured at fair value. Rather, the measurement and disclosure requirements of IFRS 13 apply when another IFRS requires or permits the item to be measured at fair value (with limited exceptions). As a result of adopting IFRS 13, the Corporation has provided additional disclosures in Note 11. There were no other impacts on the condensed consolidated interim financial statements on adoption of this standard. IAS 28, Investments in associates and joint ventures IAS 28 was re-issued by the IASB on May 12, 2011 in order to conform to changes as a result of the issuance of IFRS 10, IFRS 11, and IFRS 12. IAS 28 continues to prescribe the accounting for investments in associates, but is now the only source of guidance describing the application of the equity method. The amended IAS 28 will be applied by all entities that are investors with joint control of, or significant influence over, an investee. As a result of the adoption of the new standards above, the following accounting policies have been changed effective January 1, 2013: SUBSIDIARIES Subsidiaries are entities controlled by the Corporation. The Corporation controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the condensed consolidated interim financial statements from the date that control commences. JOINT ARRANGEMENTS Joint arrangements are arrangements of which the Corporation has joint control, established by contracts requiring unanimous consent for decisions about the activities that significantly affect the arrangements returns. They are classified and accounted for as follows: Joint operation When the Corporation has rights to the assets, and obligations for the liabilities, relating to an arrangement, it accounts for each of its assets, liabilities and transactions, including its share of those held or incurred jointly, in relation to the joint operation. Joint venture When the Group has rights only to the net assets of the arrangements, it accounts for its interest using the equity method, as for associates. EXCHANGE RATES The following exchange rates to the US dollar have been applied in these condensed consolidated interim financial statements: AVERAGE AVERAGE CLOSING CLOSING CLOSING PERIOD ENDED PERIOD ENDED PERIOD ENDED PERIOD ENDED PERIOD ENDED SEP 30, 2013 SEP 30, 2012 SEP 30, 2013 SEP 30, 2012 DEC 31, 2012 Canadian dollar 1.04 1.00 1.03 0.98 1.00 Australian dollar 1.09 0.96 1.07 0.96 0.96 Russian ruble 32.82 32.08 32.39 31.20 30.49 Kazakh tenge 152.90 149.67 153.62 149.86 150.74 Euro 0.76 0.80 0.74 0.78 0.76 3 INVENTORIES SEP 30, 2013 DEC 31, 2012 Finished uranium concentrates 18.8 18.8 Solutions and concentrates in process 4.2 4.6 Product inventory 23.0 23.4 Materials and supplies 2.8 2.2 25.8 25.6 URANIUM ONE INC. Financial Statements 6
4 MINERAL INTERESTS, PROPERTY, PLANT AND EQUIPMENT SEPTEMBER 30, 2013 MINERAL INTERESTS PROPERTY, PLANT AND EQUIPMENT DEVELOPMENT EXPENDITURE TOTAL Cost Balance at January 1 107.0 127.8 76.3 311.1 Additions 6.2 0.6 35.1 41.9 Impairment (2.3) (42.6) (22.9) (67.8) Currency translation adjustments taken to reserves (0.1) (5.1) (4.4) (9.6) Transfers - 0.6 (0.6) - At the end of the period 110.8 81.3 83.5 275.6 Accumulated depreciation Balance at January 1 (4.7) (28.5) - (33.2) Charge for the period (3.9) (20.8) - (24.7) Currency translation adjustments taken to reserves - 0.6-0.6 At the end of the period (8.6) (48.7) - (57.3) Carrying value at September 30, 2013 102.2 32.6 83.5 218.3 DECEMBER 31, 2012 MINERAL INTERESTS PROPERTY, PLANT AND EQUIPMENT DEVELOPMENT EXPENDITURE TOTAL Cost Balance at January 1 106.6 92.4 40.2 239.2 Additions - 29.4 34.2 63.6 Business combination 1.1-20.8 21.9 Disposals - (0.5) - (0.5) Transfers to inventory - - (18.6) (18.6) Currency translation adjustments taken to reserves (0.7) 5.4 0.8 5.5 Transfers - 1.1 (1.1) - At the end of the year 107.0 127.8 76.3 311.1 Accumulated depreciation Balance at January 1 - (11.2) - (11.2) Charge for the year (4.7) (23.3) - (28.0) Business combination - 5.0-5.0 Disposals - 0.2-0.2 Currency translation adjustments taken to reserves - 0.8-0.8 At the end of the year (4.7) (28.5) - (33.2) Carrying value at December 31, 2012 102.3 99.3 76.3 277.9 4.1 IMPAIRMENT An impairment of $67.8 million was recognized on the Honeymoon Project due to continuing difficulties in the production process, issues in attaining design capacity and high operating costs. The recoverable amount of the cash generating unit is determined based on its fair value less cost to sell, calculated as the present value of the estimated future cash flows, using assumptions such as production volumes, uranium prices and discount rate. The key assumptions were: Production volumes Annual production volumes are estimated based on resource estimates, operational considerations and licensing constraints. Uranium prices Uranium prices are based on market-observable data and gradually increased to $65 per pound U 3O 8 in the long term, based on detailed analysis of market fundamentals. Discount rate The discount rate used for impairment testing is the real, post tax weighted average cost of capital. The discount rate is further adjusted for political and development risk based on the jurisdiction in which the CGU or investment resides. A discount rate of 11.4% was used for the Honeymoon Project. URANIUM ONE INC. Financial Statements 7
5 INVESTMENTS IN JOINT VENTURES The Corporation owns the following interests subject to joint control as a result of governing contractual agreements. These interests are accounted for under the equity method: COUNTRY OF PRINCIPAL OWNERSHIP SEP 30, 2013 DEC 31, 2012 INCORPORATION ACTIVITY INTEREST Akbastau JSC Kazakhstan Uranium mining 50% 612.9 620.2 Betpak Dala LLP Kazakhstan Uranium mining 70% 465.8 531.7 Karatau LLP Kazakhstan Uranium mining 50% 321.5 372.3 Zarechnoye JSC Kazakhstan Uranium mining 49.67% 94.7 105.2 Kyzylkum LLP Kazakhstan Uranium mining 30% 83.1 78.0 SKZ-U LLP Kazakhstan Sulphuric acid plant 19% 12.2 10.6 1,590.2 1,718.0 Movement in investment in joint ventures SEP 30, 2013 DEC 31, 2012 Balance at January 1 1,718.0 1,844.5 Share of net income 58.5 78.8 Dividends (165.5) (184.3) Charter capital contributions 9.0 11.8 Foreign exchange and other adjustments (29.8) (32.8) At the end of the period 1,590.2 1,718.0 The joint ventures assets and liabilities are as follows, on a 100% basis: AS AT SEPTEMBER 30, 2013 BETPAK AKBASTAU DALA KARATAU ZARECHNOYE KYZYLKUM SKZ-U TOTAL Current assets Cash 19.6 42.0 10.1 12.3 21.8 1.5 107.3 Inventories 15.5 54.4 40.7 25.2 14.7 3.3 153.8 Other 30.0 78.8 53.7 25.6 34.5 14.7 237.3 65.1 175.2 104.5 63.1 71.0 19.5 498.4 Non-current assets Mineral interests, property, plant and equipment 1,177.2 666.1 849.6 246.0 405.1 181.9 3,525.9 Goodwill 222.7 - - 35.3 - - 258.0 Other 37.0 10.4 14.6 6.9 2.6 20.2 91.7 1,436.9 676.5 864.2 288.2 407.7 202.1 3,875.6 Total assets 1,502.0 851.7 968.7 351.3 478.7 221.6 4,374.0 Current liabilities Current portion of interest bearing liabilities 37.5 - - 59.8 0.1 12.1 109.5 Other 15.4 71.8 76.6 24.5 9.3-197.6 52.9 71.8 76.6 84.3 9.4 12.1 307.1 Non-current liabilities Non-current portion of interest bearing liabilities 8.7-100.1 8.8 134.7 112.9 365.2 Deferred tax liabilities 210.1 98.7 138.5 31.6 49.6 2.6 531.1 Provisions 4.4 15.8 8.4 6.5 5.7-40.8 Other - - 2.0 29.3 2.3 29.6 63.2 223.2 114.5 249.0 76.2 192.3 145.1 1,000.3 Total liabilities 276.1 186.3 325.6 160.5 201.7 157.2 1,307.4 Net assets 1,225.9 665.4 643.1 190.8 277.0 64.4 3,066.6 URANIUM ONE INC. Financial Statements 8
5 INVESTMENT IN JOINT VENTURES (continued) AS AT DECEMBER 31, 2012 BETPAK AKBASTAU DALA KARATAU ZARECHNOYE KYZYLKUM SKZ-U TOTAL Current assets Cash 13.1 3.6 2.3 2.0 3.4 3.1 27.5 Inventories 22.8 85.6 35.4 23.0 6.7 1.9 175.4 Other 71.7 114.4 32.2 25.3 51.9 5.8 301.3 107.6 203.6 69.9 50.3 62.0 10.8 504.2 Non-current assets Mineral interests, property, plant and equipment 1,217.5 690.7 898.5 264.7 404.1 183.0 3,658.5 Goodwill 226.9 - - 36.0 - - 262.9 Other 7.2 8.1 7.1 7.0 3.0 24.8 57.2 1,451.6 698.8 905.6 307.7 407.1 207.8 3,978.6 Total assets 1,559.2 902.4 975.5 358.0 469.1 218.6 4,482.8 Current liabilities Current portion of interest bearing liabilities 47.5 - - 46.6 0.1 7.3 101.5 Other 7.4 18.2 23.8 17.9 20.3 5.9 93.5 54.9 18.2 23.8 64.5 20.4 13.2 195.0 Non-current liabilities Non-current portion of interest bearing liabilities 36.1-50.0 38.3 131.4 118.9 374.7 Deferred tax liabilities 222.2 109.1 149.0 37.0 48.3 1.0 566.6 Provisions 4.3 15.5 8.2 6.5 5.7-40.2 Other 1.4 - - - 3.4 30.2 35.0 264.0 124.6 207.2 81.8 188.8 150.1 1,016.5 Total liabilities 318.9 142.8 231.0 146.3 209.2 163.3 1,211.5 Net assets 1,240.3 759.6 744.5 211.7 259.9 55.3 3,271.3 The joint ventures revenue, cost of sales, earnings from mine operations, expenses and net earnings / (loss) are as follows, on a 100% basis: THREE MONTHS ENDED AKBASTAU BETPAK DALA KARATAU ZARECHNOYE KYZYLKUM SKZ-U TOTAL SEPTEMBER 30, 2013 Revenue 69.1 131.7 70.7 20.3 25.5-317.3 Operating expenses (26.0) (57.7) (23.0) (16.9) (15.0) - (138.6) Depreciation (28.8) (34.3) (29.3) (14.4) (8.5) - (115.3) Earnings / (loss) from mine operations 14.3 39.7 18.4 (11.0) 2.0-63.4 Interest income 0.1 0.6 0.1 - (0.3) - 0.5 Interest expense (1.0) 0.4 (1.4) (1.2) (1.2) (1.1) (5.5) Expenses and other income 0.2 0.2 (1.1) (0.1) (0.7) 11.0 9.5 Foreign exchange (loss) / gain (0.2) 1.1 (1.2) (0.8) (1.4) (2.1) (4.6) Earnings / (loss) before income taxes 13.4 42.0 14.8 (13.1) (1.6) 7.8 63.3 Current and deferred income tax (expense) / recovery (2.5) (7.9) (3.8) 2.6 (2.3) (1.1) (15.0) Net earnings / (loss) 10.9 34.1 11.0 (10.5) (3.9) 6.7 48.3 Dividends paid - 98.6 26.4 - - - 125.0 URANIUM ONE INC. Financial Statements 9
5 INVESTMENT IN JOINT VENTURES (continued) NINE MONTHS ENDED AKBASTAU BETPAK DALA KARATAU ZARECHNOYE KYZYLKUM SKZ-U TOTAL SEPTEMBER 30, 2013 Revenue 115.8 257.9 135.6 63.5 35.1-607.9 Operating expenses (40.3) (114.3) (41.3) (43.7) (22.8) - (262.4) Depreciation (44.7) (65.4) (54.3) (35.0) (10.5) - (209.9) Earnings / (loss) from mine operations 30.8 78.2 40.0 (15.2) 1.8-135.6 Interest income 0.1 0.6 0.1 - (0.1) - 0.7 Interest expense (3.7) - (3.9) (4.1) (3.4) (3.4) (18.5) Expenses and other income (0.5) 0.3 (3.4) (0.5) (1.7) 18.1 12.3 Foreign exchange (loss) / gain (0.4) 1.4 (1.7) (1.3) (2.1) (3.0) (7.1) Earnings / (loss) before income taxes 26.3 80.5 31.1 (21.1) (5.5) 11.7 123.0 Current and deferred income tax (expense) / recovery (5.8) (15.2) (6.7) 4.2 (2.1) (1.6) (27.2) Net earnings / (loss) 20.5 65.3 24.4 (16.9) (7.6) 10.1 95.8 Dividends paid - 98.7 58.4 - - - 157.1 THREE MONTHS ENDED AKBASTAU BETPAK DALA KARATAU ZARECHNOYE KYZYLKUM SKZ-U TOTAL SEPTEMBER 30, 2012 Revenue 26.6 90.8 74.6 30.7 16.0-238.7 Operating expenses (6.2) (30.9) (17.4) (15.2) (10.0) - (79.7) Depreciation (8.4) (19.7) (23.3) (11.8) (4.1) - (67.3) Earnings from mine operations 12.0 40.2 33.9 3.7 1.9-91.7 Interest income 0.1-0.1 - - - 0.2 Interest expense (1.0) (1.3) - (1.5) (1.2) - (5.0) Expenses and other income 0.6 - (1.3) (181.7) (0.2) 1.2 (181.4) Foreign exchange (loss) / gain (1.5) 0.1 0.4 (1.3) (2.5) (2.6) (7.4) Earnings / (loss) before income taxes 10.2 39.0 33.1 (180.8) (2.0) (1.4) (101.9) Current and deferred income tax (expense) / recovery (1.8) (9.4) (6.7) 21.5 5.7 (2.2) 7.1 Net earnings / (loss) 8.4 29.6 26.4 (159.3) 3.7 (3.6) (94.8) Dividends paid - 148.7 15.7 - - - 164.4 NINE MONTHS ENDED AKBASTAU BETPAK DALA KARATAU ZARECHNOYE KYZYLKUM SKZ-U TOTAL SEPTEMBER 30, 2012 Revenue 61.7 214.6 175.1 70.8 16.0-538.2 Operating expenses (14.1) (68.9) (38.3) (33.3) (10.0) - (164.6) Depreciation (18.2) (44.5) (51.7) (25.8) (4.1) - (144.3) Earnings from mine operations 29.4 101.2 85.1 11.7 1.9-229.3 Interest income 0.1 1.8 0.2 0.1 - - 2.2 Interest expense (4.2) - - (4.0) (4.8) - (13.0) Expenses and other income (2.0) (2.0) 0.5 (164.0) 0.6 1.4 (165.5) Foreign exchange (loss) / gain (0.9) - 0.2 (0.8) (1.4) (1.6) (4.5) Earnings / (loss) before income taxes 22.4 101.0 86.0 (157.0) (3.7) (0.2) 48.5 Current and deferred income tax (expense) / recovery (4.2) (19.5) (14.2) 21.7 5.2 (1.7) (12.7) Net earnings / (loss) 18.2 81.5 71.8 (135.3) 1.5 (1.9) 35.8 Dividends paid 9.0 148.7 41.1 - - - 198.8 URANIUM ONE INC. Financial Statements 10
6 LOANS RECEIVABLE Loans to related parties SEP 30, 2013 DEC 31, 2012 Mantra 72.9 47.6 Loans to joint ventures 72.9 47.6 SKZ-U 25.9 30.1 25.9 30.1 Current portion 7.5 4.4 Non-current portion 91.3 73.3 Total 98.8 77.7 6.1 MANTRA LOAN The Corporation made a loan available to Mantra to provide project financing for construction and commissioning of the Mkuju River project. The loan bears interest at 7.74% per annum. The loan has no fixed repayment terms. SEP 30, 2013 DEC 31, 2012 Opening balance 47.6 6.1 Additions during the period 21.5 39.6 Interest accrued 3.8 1.9 Balance at the end of the period 72.9 47.6 Less: current portion - - Long term portion 72.9 47.6 The loan to Mantra is guaranteed by ARMZ. 6.2 SKZ-U LOAN The Corporation made loans available to SKZ-U LLP ( SKZ-U ), a joint venture in which the Corporation has a 19% interest, pursuant to its obligation to provide project financing in the amount of $31.0 million for construction and commissioning of a sulphuric acid plant. The loans bear interest at LIBOR plus 6% per annum, with interest payable on a semi-annual basis between 2013 and 2017. SEP 30, 2013 DEC 31, 2012 Opening balance 30.1 25.6 Additions during the period - 4.5 Principal received (3.7) - Interest accrued 1.4 1.9 Interest received (1.9) (1.9) Balance at the end of the period 25.9 30.1 Less: current portion (7.5) (4.4) Long term portion 18.4 25.7 The loans to SKZ-U are unsecured. URANIUM ONE INC. Financial Statements 11
7 OTHER ASSETS SEP 30, 2013 DEC 31, 2012 Current Purchased uranium concentrates 9.3 12.4 Borrowed uranium concentrates - 8.7 Cross currency swap asset - 0.9 Derivatives through profit and loss 8.1-17.4 22.0 Non-current Asset retirement funds 55.6 44.7 Cross currency swap asset - 8.8 Other 0.7 0.4 56.3 53.9 Cross currency swap asset The Corporation entered into a cross currency interest rate swap agreement ( Swap ) for the outstanding RUB 14.3 billion principal amount on its 9.75% five-year ruble-denominated bonds issued on December 7, 2011 (the Series 1 Ruble Bonds ) during 2011. Th e Swap was designated as a cash flow hedge. The Corporation applied a hedge ratio of 80% to the debt, resulting in the Swap covering 80% of the foreign currency risk inherent in the interest and principal payments on the RUB 14.3 billion borrowing under the Series 1 Ruble Bonds. On August 23, 2013, the Corporation made an offer to the holders of the Series 1 Ruble Bonds and redeemed RUB 11.8 billion of the Series 1 Ruble Bonds. This redemption resulted in RUB 2.5 billion of the principal of the Series 1 Ruble Bonds remaining outstanding. Consequently, the Corporation de-designated the hedge relationship on RUB 11.8 billion of the Swap. The Swap economically converts the remaining Series 1 Ruble Bonds into a synthetic US dollar borrowing by fixing the Corporation s principal and interest payments in US dollar terms and while the Swap is in force, the Corporation is not economically exposed to any Ruble currency risks. The Corporation recognized certain foreign exchange gains or losses in the income statement and cash flow hedge reserve during the term of the Series 1 Ruble Bonds and Swap at each reporting period. The Corporation is exposed to counterparty risk when the Swap is in an asset position. The counterparty to the Swap is an offshore subsidiary of Sberbank of Russia ( Sberbank ). Derivatives through profit and loss The Corporation entered into six further derivatives ( Derivatives ) in September 2013 for the outstanding RUB 12.5 billion principal amount on its 10.25% seven-year ruble-denominated bonds issued on August 26, 2013 (the Series 2 Ruble Bonds ). The Derivatives were interest rate forwards, currency interest swaps totaling RUB 700 million and forward starting currency interest swaps totaling RUB 11.8 billion. These Derivatives are not designated as a hedge, nor is the de-designated amount of the Swap of RUB 11.8 billion. Consequently any movement in the fair value of these instruments is taken as a gain or loss in the income statement. The Derivatives and de-designated Swap economically convert the Series 2 Ruble Bonds into synthetic US dollar borrowings by fixing the Corporation s exchange rate at USD1.00 = RUB 32.2 for the principal and interest and fixing 35% of the interest payments at 7.5% (with 65% of the interest payments subject to a rate related to LIBOR). The Corporation is not economically exposed to any Ruble currency risks while the Derivatives and the de-designated Swap are in force. The Corporation will recognize all fair value gains or losses in the income statement during the term of the Series 2 Ruble Bonds and Derivatives and de-designated Swap at each reporting period. The Corporation is exposed to counterparty risk when the Derivatives and de-designated Swap are in an asset positions. The counterparties to the Derivatives and Swap are an offshore subsidiary of Sberbank of Russia ( Sberbank ) and Gazprombank of Russia ( Gazprombank ). URANIUM ONE INC. Financial Statements 12
8 INTEREST BEARING LIABILITIES SEP 30, 2013 DEC 31, 2012 Ruble Bonds 465.3 466.7 Revolving loan facility 1,453.9-1,919.2 466.7 Current portion 1,464.9 3.0 Non-current portion 454.3 463.7 Total 1,919.2 466.7 8.1 RUBLE BONDS SEP 30, 2013 DEC 31, 2012 Opening balance 466.7 441.7 Issued 380.7 - Interest accrued 33.5 44.7 Interest paid (29.4) (43.7) Redeemed (359.4) - Amortization of transaction costs 1.0 1.4 Foreign exchange (gain) / loss (27.8) 22.6 465.3 466.7 Less: current portion (11.0) (3.0) Long term portion 454.3 463.7 On December 7, 2011, the Corporation carried out an offering and issuance of Series 1 Ruble Bonds having an aggregate principal amount of $463.5 million (RUB 14.3 billion) repayable five years from the date of issuance. The Series 1 Ruble Bonds bear intere st at a Ruble rate of 9.75%, payable semi-annually from the date of issue. On August 23, 2013 the Corporation made an offer to the holders of the Series 1 Ruble Bonds and redeemed $382.5 million (RUB 11.8 billion) of the Series 1 Ruble Bonds. This redemption resulted in $81.0 million (RUB 2.5 billion) of the principal of the Series 1 Ruble Bonds remaining outstanding. In connection with the 2011 offering, the Corporation entered into the Swap. The Swap has a USD fixed exchange rate of $1.00 = RUB 30.855 and results in a USD fixed interest rate of 6.74% on the principal amount. The Swap was entered into by the Corporation to effectively create a synthetic US dollar borrowing by converting the Ruble denominated coupon payments and principal amount of the Series 1 Ruble Bonds to fixed US dollar cash flows, and therefore eliminate any exposure to Ruble / USD fluctuations. For accounting purposes the Corporation designated 80% of the Series 1 Ruble Bonds as a cash flow hedge of the foreign currency risk inherent in the interest and principal payments on the RUB 2.5 billion borrowing. Following the partial redemption of the Series 1 Ruble Bonds, the Corporation de-designated RUB 11.8 billion of the Swap to match the principal of the remaining Series 1 Ruble Bond. On August 26, 2013, the Corporation completed a public offering in Russia of seven-year ruble-denominated Series 2 Ruble Bonds for gross proceeds of US$380.7 million (RUB12.5 billion) with a ruble interest rate of 10.25%; and simultaneous public offering to repurchase, through the facilities of the Moscow Exchange, US$359.4 million (RUB11.8 billion) of the Company s outstanding US$433.3 million (RUB1 4.3 billion) aggregate principal amount five-year Series 1 Ruble Bonds with a ruble interest rate of 9.75%. In connection with the borrowing of the Series 2 Ruble Bonds, the Corporation entered into six Derivatives. The Derivatives together with the de-designated Swap effectively create synthetic US dollar borrowing by converting the Ruble denominated principal amount and coupon payments at a fixed exchange rate for the Series 2 Ruble Bonds, and therefore eliminate any exposure to Ruble / USD fluctuations. For accounting purposes the Derivatives and de-designated Swap are not designated as a hedge. The Ruble Bonds are direct, unsecured, non-convertible, interest-bearing obligations of the Corporation, subordinated to any present or future secured obligations, and ranking equally with all other unsecured indebtedness. URANIUM ONE INC. Financial Statements 13
8 INTEREST BEARING LIABILITIES (continued) 8.2 REVOLVING LOAN FACILITY SEP 30, 2013 DEC 31, 2012 Opening balance - - Issued 1,450.0 - Interest accrued 24.6 Interest paid (20.7) - 1,453.9 - Less: current portion Long term portion (1,453.9) - - - On March 25, 2013, the Corporation arranged a three year, $1.45 billion revolving unsecured credit facility with an ARMZ affiliate. Drawings under the facility bear interest at the rate of 3.3%. Interest is payable monthly. On March 26, 2013, the Corporation drew down the facility in full and on October 21, 2013, the Corporation repaid $1.2 billion of the facility. The facility has been classified as current liability as the agreement includes certain provisions with regards to accelerated payment. 9 CONVERTIBLE DEBENTURES 2010 Debentures On March 12, 2010, the Corporation issued convertible unsecured subordinated debentures for gross proceeds of C$260 million ($253.3 million), (the 2010 Debentures ). The 2010 Debentures have a March 13, 2015 maturity date, with interest payable at a rate of 5.0% per annum, payable semi-annually. The 2010 Debentures are convertible into common shares of the Corporation at a conversion price of C$3.15 per common share, being a rate of 317.46 common shares per C$1,000 principal. The debentures had a cash settlement option which was accounted for as an embedded derivative. The Corporation allocated the fair value of the debentures to the individual liability and derivative components by establishing the derivative component and then allocating the balance remaining, after subtracting the fair value of the derivative from the face value, to the liability component. The embedded derivative was designated as a financial liability carried at fair value through profit or loss. On October 12, 2010, the Corporation received all necessary Kazakh regulatory approvals to allow the conversion of the 2010 Debentures into common shares of Uranium One at the option of the holders of the 2010 Debentures and as a result the cash settlement option was cancelled. The embedded derivative was reclassified as equity on cancellation of the cash settlement option. Within 30 days of completion of the going private transaction mentioned in note 1, which occurred on October 18, 2013, the Corporation will make an offer to purchase the C$260 million aggregate principal amount of the 2010 Debentures in accordance with the terms of the trust indenture governing the debentures. As a result of the change in the estimated cash flows an additional charge of $17.8 million was recorded in the quarter. The effective annual interest rate is 10.38%. The table below indicates the movement in the liability: SEP 30, 2013 DEC 31, 2012 Opening balance 231.1 214.4 Interest accrued 36.4 24.0 Coupon interest payments (6.3) (12.9) Foreign exchange movement (7.8) 5.6 Liability as at the end of the period 253.4 231.1 Current portion (3.1) - Non-current portion 250.3 231.1 Fair value of convertible debentures 254.9 264.9 URANIUM ONE INC. Financial Statements 14
10 OTHER LIABILITIES SEP 30, 2013 DEC 31, 2012 Current Uranium concentrates loan - 8.7 Unfavorable contracts 1.2 2.6 Other 0.6 0.7 1.8 12.0 Non-current Cross currency swap liability (note 7) 18.9 - Unfavorable contracts 15.4 17.0 Other 0.2-34.5 17.0 Uranium concentrates loan On September 22, 2008, the Corporation entered into a loan agreement to borrow 200,000 pounds of U 3O 8 to be repaid on September 30, 2010. The maturity of the loan was subsequently extended to September 30, 2013 and the contract was settled on this date. Under the loan agreement, loan fees of 3.5% per annum are payable based on the value of the borrowed U 3O 8. In addition to the loan agreement, the Corporation incurred $0.3 million in loan arrangement fees, which have been expensed. The Corporation recognized the borrowed uranium in other assets (note 7). The loan is classified as a financial liability carried at fair value through profit or loss. Unfavorable contracts The Corporation has legacy sales contracts for Honeymoon with unfavorable terms. With the withdrawal of Mitsui & Co. (the Corporation s former joint venture partner in the Honeymoon project), the Corporation is required to account for these contracts at their realizable values. Production from Honeymoon will be used to deliver into these contracts. Cross currency swap liability Refer to note 7. 11 FAIR VALUE MEASUREMENT The carrying values of the assets and liabilities presented in the tables below are shown at their fair values. There are three levels of the fair value hierarchy that prioritize the input valuation techniques used to measure fair value, with level 1 inputs having the highest level of certainty. AS AT SEPTEMBER 30, 2013 FAIR VALUE HIERARCHY OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE LEVEL 1 LEVEL 2 LEVEL 3 TOTAL Available for sale securities 0.3 - - 0.3 Purchased uranium concentrates - 9.3-9.3 Net cross currency swap derivative liability - - (18.9) (18.9) Derivatives through profit and loss - - 8.1 8.1 Total 0.3 9.3 (10.8) (1.2) AS AT DECEMBER 31, 2012 FAIR VALUE HIERARCHY OF ASSETS AND LIABILITIES MEASURED AT FAIR VALUE LEVEL 1 LEVEL 2 LEVEL 3 TOTAL Available for sale securities 0.3 - - 0.3 Purchased uranium concentrates - 12.4-12.4 Borrowed uranium concentrates - 8.7-8.7 Uranium concentrates loan - (8.7) - (8.7) Net cross currency swap derivative asset - - 9.8 9.8 Total 0.3 12.4 9.8 22.5 Level 1 of the fair value hierarchy includes unadjusted quoted prices in active markets for identical assets or liabilities; Level 2 of the hierarchy includes inputs that are observable for the asset or liability, either directly or indirectly; and Level 3 includes inputs for the asset or liability that are not based on observable market data. URANIUM ONE INC. Financial Statements 15
11 FAIR VALUE MEASUREMENT (continued) Fair value assets and liabilities classified as Level 2 are valued using pricing models or discounted cash flow (DCF) models. These models require a variety of observable inputs including market prices, forward price curves, yield curves and credit spreads. These inputs are obtained from or verified with the market where possible. The table below shows a reconciliation of level 3 fair value measurements of financial liabilities / (assets): SEP 30, 2013 DEC 31, 2012 Opening balance 29.2 54.5 Additions 20.4 - Unrealized (gain) / loss recognized in other comprehensive income 29.5 (25.3) Interest accrued on swap (8.7) (13.1) Interest paid 7.9 11.8 Foreign exchange (8.1) 1.3 70.2 29.2 Unrealized loss due to unobservable inputs at inception (59.4) (39.0) 10.8 (9.8) Current portion (asset) (8.1) (0.9) Non-current portion (asset) / liability 18.9 (8.9) The Corporation entered into the Swap for the outstanding Series 1 Ruble Bonds. The Swap is designated as a cash flow hedge. The Swap is valued using a DCF model based on observable and unobservable inputs. The Corporation applied a hedge ratio of 80% to the debt, resulting in the Swap covering 80% of the foreign currency risk inherent in the interest and principal payments on the RUB 2.5 billion borrowing. Following the partial redemption of the Series 1 Ruble Bonds, the Corporation de-designated RUB 11.8 billion of the Swap. The Swap economically converts the remaining Series 1 Ruble Bonds into a synthetic US dollar borrowing by fixing the Corporation s principal and interest payments in US dollar terms and, while the Swap is in force, the Corporation is not economically exposed to any ruble currency risks. The Corporation recognized certain foreign exchange gains or losses in the income statement and cash flow hedge reserve during the term of the Series 1 Ruble Bonds and Swap at each reporting period. The Corporation is exposed to counterparty risk when the Swap is in an asset position. The counterparty to the Swap is an offshore subsidiary of Sberbank. The Corporation entered into six Derivatives which together with the de-designated Swap effectively create synthetic US dollar borrowings by converting the Ruble denominated principal amount of RUB 12.5 billion and coupon payments at a fixed exchange rate for the Series 2 Ruble Bonds, and therefore eliminate any exposure to Ruble / USD fluctuations. For accounting purposes the Derivatives and de-designated Swap are not designated as a hedge. The Corporation will recognize all foreign exchange gains or losses in the income statement during the term of the Series 2 Ruble Bonds and Derivatives and de-designated Swap at each reporting period. The Derivatives and de-designated Swap are valued using a DCF model based on observable and unobservable inputs. The fair value of the Derivatives as at September 30, 2013 were for: the interest rate forwards - USD 0.1 million, the currency interest swaps USD 1.5 million and, forward starting currency interest swaps USD 6.5 million. The following table illustrates the movement in the Ruble Bonds and the Swap, and the effect of the application of hedge accounting on the financial results. SEPTEMBER 30, 2013 RUBLE BONDS (NOTE 8) SWAP (ASSET) / LIABILITY (NOTES 7 AND 10) RESERVES (NOTE 12) INCOME STATEMENT (LOSS) / GAIN Opening balance 466.7 (9.8) 4.1 - Issued 380.7 - - - Interest accrued 33.5 (8.7) - (24.8) Interest paid (29.4) 7.9 - - Repaid (359.4) - - - Transaction costs, amortized 1.0 - - (1.0) Realized fair value reclassified to income statement - - (4.3) 4.3 Foreign exchange (27.8) (8.1) 29.7 6.2 Revaluation - 29.5 (30.1) 0.6 Closing balance 465.3 10.8 (0.6) (14.7) URANIUM ONE INC. Financial Statements 16
11 FAIR VALUE MEASUREMENT (continued) DECEMBER 31, 2012 RUBLE BONDS (NOTE 8) SWAP (ASSET) / LIABILITY (NOTES 7 AND 10) RESERVES (NOTE 12) INCOME STATEMENT (LOSS) / GAIN Opening balance 441.7 15.5 (2.0) Transaction costs, amortized 1.4 - - (1.4) Interest accrued 44.7 (13.1) - (31.6) Interest paid (43.7) 11.8 - Foreign exchange 22.6 1.3 (18.0) (5.9) Revaluation - (25.3) 24.1 1.2 Closing balance 466.7 (9.8) 4.1 (37.7) 12 RESERVES SEP 30, 2013 DEC 31, 2012 Equity settled employee benefits reserve Balance at the beginning of the period 128.3 122.3 Stock options expense 2.1 6.0 Balance at the end of the period 130.4 128.3 Equity component of convertible debentures Balance at the beginning of the period 67.0 67.0 Balance at the end of the period 67.0 67.0 Foreign currency translation reserve Balance at the beginning of the period (36.2) 5.7 Exchange fluctuations on translation of foreign operations (42.7) (48.5) Business combination - 6.6 Balance at the end of the period (78.9) (36.2) Cash flow hedging reserve Balance at the beginning of the period 4.1 (2.0) Realized fair value reclassified to income statement (4.3) - Foreign exchange 29.7 (18.0) Revaluation (30.1) 24.1 Balance at the end of the period (0.6) 4.1 Fair value reserve Balance at the beginning of the period (0.1) - Unrealized fair value adjustments on available for sale securities - (0.1) Balance at the end of the period (0.1) (0.1) Total reserves 117.8 163.1 URANIUM ONE INC. Financial Statements 17
13 SEGMENTED INFORMATION Information reported to the Corporation s chief operating decision maker for the purposes of resource allocation and assessment of segment performance is primarily by operating mine or mineral property and its location. The following financial information is presented by operating segment and is reconciled to these condensed consolidated financial statements. The proportionate share of the Corporation's reportable operating segments are summarized in the table below: THREE MONTHS ENDED SEPTEMBER 30, 2013: REVENUES OPERATING EXPENSE DEPRECIATION EXPLORATION EXPENSE NET FINANCE COSTS INCOME TAX (EXPENSE) / RECOVERY NET EARNINGS / (LOSS) Kazakhstan Akbastau Mine 34.6 (13.0) (14.5) - (0.4) (1.2) 5.3 Akdala Mine 43.6 (15.2) (9.8) - - (2.8) 15.9 South Inkai Mine 64.3 (25.2) (14.6) - - (2.7) 23.0 Karatau Mine 35.4 (11.5) (14.7) - (0.8) (2.0) 5.4 Zarechnoye Mine 10.2 (8.4) (7.1) - (0.7) 1.3 (5.3) Kharasan Mine 7.6 (4.6) (2.5) - (0.4) (0.9) 0.2 United States Willow Creek Mine 25.1 (14.8) (15.3) - (0.4) - (5.5) ISR projects - - - - - - (0.4) Conventional mining projects - - - - - - (0.1) Australia Honeymoon Project - - - (0.2) (0.9) - (65.9) Corporate and other - - - (0.3) (44.2) (0.2) (36.2) 220.8 (92.7) (78.5) (0.5) (47.8) (8.5) (63.6) Attributable to joint ventures (179.8) 77.9 62.7-2.6 8.3-41.0 (14.8) (15.8) (0.5) (45.2) (0.2) (63.6) NINE MONTHS ENDED SEPTEMBER 30, 2013: REVENUES OPERATING EXPENSE DEPRECIATION EXPLORATION EXPENSE NET FINANCE COSTS INCOME TAX (EXPENSE) / RECOVERY NET EARNINGS / (LOSS) Kazakhstan Akbastau Mine 57.9 (20.2) (22.5) - (1.8) (2.9) 10.3 Akdala Mine 73.1 (24.7) (15.9) - - (5.1) 27.6 South Inkai Mine 139.4 (55.4) (30.1) - - (5.5) 49.5 Karatau Mine 67.8 (20.7) (27.3) - (2.2) (3.4) 11.6 Zarechnoye Mine 31.6 (21.7) (17.4) - (2.2) 2.1 (8.6) Kharasan Mine 10.5 (6.9) (3.1) - (1.0) (0.9) (0.2) United States Willow Creek Mine 26.1 (19.8) (20.4) - (0.6) - (14.7) ISR projects - - - (0.7) - - (0.5) Conventional mining projects - - - - - - 0.1 Australia Honeymoon Project - - - (0.8) 0.3 - (65.5) Corporate and other (0.5) (79.2) (4.5) (72.1) 406.4 (169.4) (136.7) (2.0) (86.7) (20.2) (62.5) Attributable to joint ventures (348.3) 149.6 115.8-8.0 15.7-58.1 (19.8) (20.9) (2.0) (78.7) (4.5) (62.5) URANIUM ONE INC. Financial Statements 18
13 SEGMENTED INFORMATION (continued) THREE MONTHS ENDED SEPTEMBER 30, 2012: REVENUES OPERATING EXPENSE DEPRECIATION EXPLORATION EXPENSE NET FINANCE COSTS INCOME TAX (EXPENSE) / RECOVERY NET EARNINGS / (LOSS) Kazakhstan Akbastau Mine 13.3 (3.1) (4.2) - (0.5) (0.9) 4.5 Akdala Mine 29.3 (7.6) (5.8) - (0.4) (3.1) 13.1 South Inkai Mine 42.5 (14.0) (8.2) - (0.6) (3.4) 16.1 Karatau Mine 37.3 (8.8) (11.7) - - (3.4) 12.9 Zarechnoye Mine 15.3 (7.5) (5.9) - (0.8) 10.7 (78.7) Kharasan Mine (1) 4.9 (3.0) (1.2) - (0.4) 1.3 1.5 United States Willow Creek Mine (2) - (1.6) (1.2) - (0.3) - (3.1) ISR projects - - - (0.2) - - 0.3 Conventional mining projects - - - - - - (0.5) Australia Honeymoon Project - - - (0.3) - - 15.4 Corporate and other - - - - (13.1) (0.6) (43.1) Attributable to joint ventures 142.6 (45.6) (38.2) (0.5) (16.1) 0.6 (61.6) (134.1) 44.0 36.7-2.7 (1.2) - 8.5 (1.6) (1.5) (0.5) (13.4) (0.6) (61.6) (1) The Kharasan Mine was successfully commissioned during the period ended September 30, 2012. (2) The Willow Creek Mine was successfully commissioned during the period ended June 30, 2012. The mine was previously disclosed within ISR projects. NINE MONTHS ENDED SEPTEMBER 30, 2012: REVENUES OPERATING EXPENSE DEPRECIATION EXPLORATION EXPENSE NET FINANCE COSTS INCOME TAX (EXPENSE) / RECOVERY NET EARNINGS / (LOSS) Kazakhstan Akbastau Mine 31.3 (7.0) (9.1) - (2.2) (2.1) 10.5 Akdala Mine 84.3 (20.6) (16.0) - 0.2 (8.1) 40.0 South Inkai Mine 80.8 (27.7) (15.7) - 0.6 (5.5) 31.3 Karatau Mine 88.9 (19.2) (26.0) - (0.1) (7.1) 35.6 Zarechnoye Mine 35.7 (16.5) (12.9) - (2.3) 10.8 (67.0) Kharasan Mine (1) 4.9 (3.0) (1.2) - (1.4) 1.2 0.2 United States Willow Creek Mine (2) 9.4 (8.2) (4.0) - (0.3) - (3.1) ISR projects - - - (1.7) - - (1.2) Conventional mining projects - - - (0.3) - - (1.6) Australia Honeymoon Project - - - (1.2) - - 14.8 Corporate and other - - (40.9) 8.3 (87.4) Attributable to joint ventures 335.3 (102.2) (84.9) (3.2) (46.4) (2.5) (27.9) (308.5) 94.0 80.1-5.2 10.8-26.8 (8.2) (4.8) (3.2) (41.2) 8.3 (27.9) (1) The Kharasan Mine was successfully commissioned during the period ended September 30, 2012. (2) The Willow Creek Mine was successfully commissioned during the period ended June 30, 2012. The mine was previously disclosed within ISR projects. URANIUM ONE INC. Financial Statements 19