Wedoany.com Report-Oct 28, Paladin Energy Ltd (ASX:PDN)'s latest quarterly production report sparked a sharp downturn in its share price that has been felt across the broader uranium sector.
Shares in Paladin plummeted by more than 21% in morning trading and were down by about 15% this afternoon as the market reacted to weaker-than-anticipated results.
Fellow uranium companies, including Boss Energy, Bannerman Energy and Deep Yellow, also saw declines, each losing more than 4% in response to Paladin’s report.
During the three months ending September 30, Paladin’s Langer Heinrich Mine (LHM) in Namibia reported production of 0.64 million pounds of U3O8 — a 23% increase from the previous quarter's 0.52 million pounds.
The company sold 0.62 million pounds of U3O8, bringing in cash receipts of $24.8 million.
But despite the increased production, revenue fell below expectations due to lower sales prices than prevailing uranium spot prices, compounding the company’s high production costs.
Operational challenges significantly impacted Paladin’s performance. Variability in stockpiled ore led to a lower-than-anticipated feed grade and the company faced delays in commissioning the mine’s second classification circuit.
Additionally, lower tailings water recovery created water balance issues within the plant, reducing recovery rates. These operational setbacks dampened overall production volumes and weighed heavily on investor sentiment.
In response, Paladin is implementing operational improvements to address these challenges and stabilise production as it ramps up toward nameplate capacity at LHM. However, the company plans a two-week shutdown in November to execute further upgrades and mitigate these issues.
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