Centrus Energy (LEU) risk factors, FY2024 10-K

Risks related to general factors primarily include

1. 01The current war in Ukraine and related international or U.S. sanctions and restrictions on trade could have a material adverse impact on our business, results of operations, and financial condition
2. 02Our future prospects are tied directly to the nuclear energy industry worldwide. The financial difficulties experienced by, and operating conditions of, our customers and suppliers could adversely affect our results of operations and financial condition
3. 03Our business, financial and operating performance could be adversely affected by epidemics and other health related issues
4. 04Our business is exposed to price volatility associated with the procurement of SWU and uranium

Operational Risks

1. 05Restrictions on imports or sales of SWU or uranium that we buy from our Russian supplier and our other sources of supply could adversely affect profitability and the viability of our business
2. 06We are dependent on purchases from our suppliers and other sources to meet our obligations to customers and rely on third parties to provide essential goods and services
3. 07We face significant competition from major producers who may be less cost sensitive or may be favored due to support from foreign governments
4. 08The ability to compete in certain foreign markets may be limited for legal, political, economic, or other reasons
5. 09Dependence on our largest customers or suppliers could adversely affect us
6. 10There is no assurance that we will be awarded any task orders under any of our IDIQ contracts and, if awarded, the nature, timing and amount of the task orders that may be issued under an award is uncertain
7. 11The dollar amount of the LEU backlog, as stated at any given time, is not necessarily indicative of future sales revenues and is subject to uncertainty
8. 12Our ability to operate the HALEU enrichment facility we are deploying under the HALEU Operation Contract after the completion of the contract is dependent on our ability to secure additional contracts and funding from the U.S. government or other sources
9. 13In Phase 2, we expect to continue operating for a full year at an annual production rate of 900 kilograms of HALEU, but there is no assurance that we will produce 900 kilograms by June 2025
10. 14Our Technical Solutions segment conducts business under various types of contracts, including fixed-price and cost-share contracts, which subjects us to risks associated with cost overruns

Financial Risks

1. 15We continue to have significant long-term liabilities, including the indebtedness under our 2.25% Convertible Notes, which mature in November 2030 and our 8.25% Notes, which mature in February 2027
2. 16The terms of the indenture governing our 8.25% Notes do not restrict Centrus or any of its subsidiaries from incurring substantial additional indebtedness in the future. If we incur substantial additional indebtedness, however, the foregoing risks would intensify
3. 17The conditional conversion feature of our 2.25% Convertible Notes, if triggered, may adversely affect our financial condition and operating results
4. 18Conversion of our 2.25% Convertible Notes may dilute the ownership interest of our stockholders or may otherwise depress the price of our common stock
5. 19Certain provisions in the indenture governing the 2.25% Convertible Notes may delay or prevent an otherwise beneficial takeover attempt of us
6. 20Servicing our debt requires a significant amount of cash, and we may not have sufficient cash flow from our business to pay our debt
7. 21The Company has material unfunded postretirement health and life benefit obligations. Changes in interest rates and other factors affecting the amounts to be contributed to fund future postretirement benefit liabilities could adversely affect earnings and cash flows in future periods
8. 22Our revenues and operating results may fluctuate significantly from quarter to quarter and year to year, which could have an adverse effect on our cash flows
9. 23Results of operations could be negatively impacted if adverse conditions or changes in circumstances indicate a possible impairment loss related to our intangible assets
10. 24Centrus is dependent on intercompany support from Enrichment Corp
11. 25A small number of holders of our Class A Common Stock may exert significant influence over the direction of the Company
12. 26A small number of Class A stockholders, who also have significant holdings of the Company’s 8.25% Notes, may be motivated by interests that are not aligned with the Company’s other Class A stockholders
13. 27Our ability to utilize our NOL carryforwards to offset future taxable income may be limited

Legal and Compliance Risks

1. 28Our operations are highly regulated by the U.S. government, including the NRC and the DOE as well as the States of Ohio and Tennessee and could be significantly impacted by changes in government policies and priorities
2. 29Our operations involve the use, transportation and disposal of toxic, hazardous and/or radioactive materials and could result in liability without regard to fault or negligence
3. 30Failures to protect classified or other sensitive information, or cybersecurity incidents could result in significant liability or otherwise have an adverse effect on our business
4. 31The inability to attract and retain key personnel could have an adverse impact on our business
5. 32The potential for the DOE to seek to terminate or exercise its remedies under the 2002 DOE-USEC Agreement and our other agreements with DOE, or to require modifications to such agreements that are adverse to our interests, may have adverse consequences on the Company
6. 33Our success depends on our ability to adapt to a rapidly changing competitive environment in the nuclear industry