Company Overview - enCore Energy aims to produce 3 million pounds of U3O8 per year by the end of 2026 and 5 million pounds of U3O8 per year by the end of 2028 [26] - The company has a market capitalization of $835,566,936 USD as of February 12, 2024 [34] Production and Operations - Rosita Central ISR Uranium Processing Plant (CPP) restarted production in November 2023 and is expected to produce approximately 200,000 pounds of U3O8 per year [65, 92] - The Rosita CPP has a licensed production capacity of 800,000 pounds of U3O8 per year, with the potential to double capacity within existing licenses [67] - Alta Mesa CPP is planned for production in 2024, with an initial production target of approximately 500,000 pounds [16, 96] - The combined capacity of the company's three fully licensed CPPs (Rosita, Kingsville Dome, and Alta Mesa) is 3.6 million pounds of U3O8 per year [82] Resource Estimates - Alta Mesa and Mesteña Grande have total Measured and Indicated Mineral Resources of 1,570,000 tons at 0.109% U3O8, containing 3.41 million pounds of U3O8 [95] - Alta Mesa and Mesteña Grande have total Inferred Mineral Resources of 6,996,000 tons at 0.120% U3O8, containing 16.793 million pounds of U3O8 [95] - Dewey-Burdock Project has Measured and Indicated ISR Resources of 7,388,222 tons at an average grade of 0.116% U3O8, containing 17.12 million pounds [102] - Gas Hills Project has Measured & Indicated ISR mineral resources of 3.83 million tons at 0.101% eU3O8, attributable to 7.71 million pounds U3O8 [111] - Crownpoint & Hosta Butte Project has total Indicated Mineral Resource of 10.96 million tons at Grade eU3O8 0.117 %, attributable U3O8 is 25.70 million pounds [124] Market and Strategy - The company has four uranium sales agreements in place [23, 87] - The company is pursuing a non-core asset divestment strategy [25, 136] - The company is investing in new technologies like Prompt Fission Neutron (PFN) technology [25, 58, 137]

Core Viewpoint - enCore Energy Corp. has achieved record uranium extraction rates at the Alta Mesa In-Situ Recovery (ISR) Uranium Central Processing Plant since operations began in June 2024, driven by management changes and operational efficiencies [1][2][3] Group 1: Operational Highlights - The Alta Mesa Project's Wellfield 7 has expanded with the addition of 28 wells, including 13 extraction wells and 15 injection wells, as part of a strategy to ramp up wellfield expansion every 4 to 5 weeks [2] - The company operates 24 drill rigs across its South Texas operations, indicating a consistent acceleration in wellfield development [2][5] - Recent uranium capture rates exceeded 3,000 pounds per day, peaking at 3,705 pounds on June 20, 2025, with an average of 2,410 pounds per day for the first 22 days of June 2025 [5] Group 2: Legislative Support - The company commended the Texas Legislature for passing legislation that streamlines the uranium recovery permitting process, which is expected to promote nuclear energy in Texas [1][3] Group 3: Project Capacity and Technology - The Alta Mesa CPP has a total operating capacity of 1.5 million pounds of uranium per year, with an additional drying capacity of 0.5 million pounds [4] - The project utilizes ISR technology, which is a non-invasive method for uranium extraction using natural groundwater and oxygen [6] Group 4: Future Projects - enCore Energy is planning future projects, including the Dewey-Burdock project in South Dakota and the Gas Hills project in Wyoming, as part of its project pipeline [11]

Core Insights - enCore Energy Corp. has disposed of 170,000,000 common shares of Anfield Energy Inc. at a price of $0.115 per share, resulting in total proceeds of $19,550,000 CAD [1] - Following the transaction, enCore no longer holds any common shares of Anfield, marking a 14.73% decrease in ownership on an undiluted basis [2] - Since the last early warning report on January 15, 2024, enCore's holdings in Anfield have decreased by approximately 16.02% [2] Company Overview - enCore Energy Corp. is focused on providing clean, reliable, and affordable fuel for nuclear energy, being the only U.S. uranium company with multiple central processing plants in operation [5] - The company operates the Rosita Central Processing Plant in South Texas and has a joint venture for the Alta Mesa Central Processing Plant with Boss Energy Ltd. [5] - enCore utilizes in-situ recovery (ISR) for uranium extraction, a technology co-developed by its leadership, and has future projects planned in South Dakota and Wyoming [6]

Global Defense Spending - Global defense spending reached an all-time high of $2.72 trillion in 2024, marking a 9.4% year-over-year increase, the sharpest rise since the Cold War era [1] - The top five spenders—United States, China, Russia, Germany, and India—accounted for 60% of the global defense budget, with U.S. military expenditure growing by 5.7% to $997 billion, representing 37% of total global defense spending [2] European Union Defense Spending - EU member states are expected to increase annual defense spending by around €80 billion ($84 billion) by 2027, equivalent to roughly 0.5% of GDP [6] - Defense expenditures in the euro area accounted for 1.8% of GDP in 2024, projected to rise to 2.4% by 2027, with Germany's military spending jumping 28% to $88.5 billion [7] Factors Driving Increased Spending - Global defense spending has been rising since Russia's invasion of Ukraine, with Europe significantly increasing military equipment purchases from non-EU suppliers [8] - All 32 NATO members increased defense budgets in 2024, with 18 countries meeting or exceeding the bloc's 2% of GDP target [9] Aerospace and Defense Sector Performance - The aerospace sector saw earnings grow by 23.2% in Q1, with an 85.7% beat ratio, while revenues increased by 0.2% with a 71.4% beat ratio [5] - The Zacks Aerospace-Defense industry ranks in the top 20% of over 250 Zacks industries, indicating strong investor interest in defense and aerospace stocks [10] Exchange-Traded Funds (ETFs) in Aerospace and Defense - Several ETFs focus on the aerospace and defense sector, including iShares U.S. Aerospace & Defense ETF (ITA), Invesco Aerospace & Defense ETF (PPA), and SPDR S&P Aerospace & Defense ETF (XAR), each with varying fee structures [12][13][14] - The Global X Defense Tech ETF (SHLD) provides exposure to defense technology companies, with a significant allocation to the U.S. [15]

Core Points - A class action securities lawsuit has been filed against enCore Energy Corp. for alleged securities fraud affecting investors between March 28, 2024, and March 2, 2025 [1][2] - The lawsuit claims that enCore Energy lacked effective internal controls over financial reporting, could not capitalize certain exploratory and development costs under GAAP, and that these issues led to substantially increased net losses [2] - Defendants' positive statements regarding enCore's business, operations, and prospects are alleged to be materially misleading and lacking a reasonable basis [2] Next Steps - Investors who suffered losses during the specified timeframe have until May 13, 2025, to request appointment as lead plaintiff, although participation in any recovery does not require serving as lead plaintiff [3] - Class members may be entitled to compensation without any out-of-pocket costs or fees [3] Firm Background - Levi & Korsinsky has a history of securing hundreds of millions of dollars for shareholders and has extensive expertise in complex securities litigation [4] - The firm has been recognized in ISS Securities Class Action Services' Top 50 Report for seven consecutive years as one of the top securities litigation firms in the United States [4]

Core Viewpoint - enCore Energy Corp. is facing a class action lawsuit due to alleged misleading statements and failures in financial reporting during the specified class period, leading to significant investor losses [3][4]. Summary by Relevant Sections Class Action Details - The class action lawsuit represents investors who purchased enCore securities between March 28, 2024, and March 2, 2025, with a deadline for filing a lead plaintiff motion set for May 13, 2025 [1]. Allegations Against enCore Energy - The lawsuit claims that enCore Energy made false or misleading statements and failed to disclose critical information, including: - Lack of effective internal controls over financial reporting [3]. - Inability to capitalize certain exploratory and development costs according to U.S. GAAP [3]. - Resulting in net losses that were significantly greater than previously reported [3]. Financial Impact - On March 3, 2025, enCore Energy reported a fiscal 2024 net loss of $61.3 million, more than double the $25.6 million loss from the previous fiscal year [4]. - The increased loss was partly attributed to the inability to capitalize certain costs under U.S. GAAP, which would have been capitalized under IFRS [4]. - The company also disclosed a "material weakness" in its internal controls over financial reporting, citing deficiencies in risk assessment and monitoring activities [4]. - Following these disclosures, enCore Energy's stock price fell by over 46% [4].

PART I [Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements for Q1 2025 show a net loss of $25.4 million and decreased total assets, reflecting the company's transition to U.S. GAAP - As of January 1, 2025, the Company became a **U.S. Domestic Issuer** and prepared its consolidated financial statements in accordance with **U.S. GAAP**[38](index=38&type=chunk) Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $54,038 | $87,414 | | **Total Assets** | $362,607 | $392,722 | | **Total Current Liabilities** | $18,361 | $30,080 | | **Total Liabilities** | $62,683 | $74,180 | | **Total Equity** | $299,924 | $318,542 | Consolidated Statement of Operations Highlights (in thousands) | Account | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Revenue** | $18,239 | $30,394 | | **Gross Loss** | $(23) | $(469) | | **Operating Loss** | $(15,626) | $(12,278) | | **Net Loss** | $(25,387) | $(7,742) | | **Net Loss per Share (Basic & Diluted)** | $(0.13) | $(0.04) | Consolidated Statement of Cash Flows Highlights (in thousands) | Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash used in operating activities** | $(7,735) | $(3,049) | | **Net cash used in investing activities** | $(7,710) | $(5,092) | | **Net cash provided by financing activities** | $5,422 | $89,793 | | **Net (decrease) increase in cash** | $(10,023) | $81,652 | [Notes to the Consolidated Unaudited Financial Statements](index=16&type=section&id=Notes%20to%20the%20Consolidated%20Unaudited%20Financial%20Statements) Key notes detail the company's Exploration Stage Issuer status, the sale of Alta Mesa and New Mexico assets, ongoing lawsuits, and 8.315 million pounds of uranium sales commitments - The Company is classified as an **Exploration Stage Issuer** under SEC regulations due to the absence of proven or probable mineral reserves[36](index=36&type=chunk)[48](index=48&type=chunk) - In February 2024, Boss Energy acquired a **30% equity interest** in the Alta Mesa Project for **$60 million**, with enCore retaining a 70% interest and management control[118](index=118&type=chunk) - In April 2025, the company completed the sale of its Crownpoint and Hosta Butte projects in New Mexico to Verdera Energy Corp[117](index=117&type=chunk)[175](index=175&type=chunk) - The company is a defendant in a federal securities class action lawsuit filed in March 2025, alleging ineffective internal controls and improper cost capitalization[128](index=128&type=chunk)[129](index=129&type=chunk) - The company's former CEO filed a demand for arbitration in April 2025, alleging breach of employment agreement and seeking damages[176](index=176&type=chunk) Uranium Sales Commitments (in thousands of pounds) | Year | Volume (lbs) | | :--- | :--- | | Remainder of 2025 | 365 | | 2026 | 900 | | 2027 | 850 | | 2028 | 1,000 | | 2029 | 1,500 | | Thereafter | 3,700 | | **Total** | **8,315** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's domestic ISR uranium extraction focus, Q1 2025 revenue of $18.2 million, a net loss of $25.4 million, and sufficient liquidity for the next twelve months [Business Overview and Strategy](index=38&type=section&id=Business%20Overview%20and%20Strategy) enCore Energy, an exploration-stage issuer, focuses on domestic ISR uranium extraction, aiming to expand capacity from South Texas to become a leading U.S. supplier - The company focuses on extracting **domestic uranium** in the United States using proven **ISR technology**[180](index=180&type=chunk) - Despite commencing uranium extraction, the company remains an **exploration stage issuer** due to the absence of proven or probable mineral reserves[179](index=179&type=chunk) - The company's strategy involves developing uranium extraction facilities, starting in South Texas, to meet growing demand for clean nuclear energy[180](index=180&type=chunk) [Industry and Market Update](index=38&type=section&id=Industry%20and%20Market%20Update) The global uranium market faces demand exceeding supply, supported by nuclear reactor extensions and U.S. government policies, while global events like Kazatomprom's suspension and Saudi Arabia's entry plans create uncertainty - Global uranium demand, approximately **175.2 million lbs U3O8 annually**, continues to exceed primary production, with the deficit met by diminishing stockpiles[181](index=181&type=chunk) - Executive Orders in early 2025 designated uranium as a **'critical mineral'** and **'energy resource'**, directing federal agencies to advance permitting and production[183](index=183&type=chunk) - The U.S. implemented tariffs on goods from Canada, Mexico, and China in March 2025, creating trade tensions, though some USMCA-related tariffs were delayed[185](index=185&type=chunk) - Kazakhstan's Kazatomprom announced a temporary production suspension, while Saudi Arabia intends to enrich and sell uranium[188](index=188&type=chunk) [Operations and Corporate Update](index=42&type=section&id=Operations%20and%20Corporate%20Update) In Q1 2025, enCore sold 290,000 lbs of U3O8, expanded its South Texas drilling fleet, doubled Alta Mesa's capacity, and advanced permitting for projects in South Dakota and Wyoming Q1 2025 Uranium Sales | Metric | Value | | :--- | :--- | | **Volume Sold** | 290,000 lbs U3O8 | | **Average Sales Price** | $62.89 per lb U3O8 | - The company increased its active drill rigs in South Texas from **17** at year-end 2024 to **22** as of March 31, 2025[193](index=193&type=chunk)[206](index=206&type=chunk) - A second Ion Exchange (IX) Circuit at the Alta Mesa CPP doubled its total flow capacity from **2,500 to 5,000 gallons per minute (GPM)**[193](index=193&type=chunk) - The company is advancing its Dewey-Burdock project in South Dakota and has initiated permitting and exploration for the Gas Hills Project in Wyoming[210](index=210&type=chunk)[211](index=211&type=chunk) [Results of Operations](index=49&type=section&id=Results%20of%20Operations) Q1 2025 revenue decreased 40% to $18.2 million due to lower volumes and prices, resulting in a net loss of $25.4 million, primarily from an unrealized loss on marketable securities, with extracted uranium costing $45.62 per pound Q1 2025 vs Q1 2024 Operational Comparison | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenue** | $18.2M | $30.4M | -40% | | **Volumes Sold (lbs)** | 290,000 | 320,000 | -9% | | **Realized Sales Price ($/lb)** | $62.89 | $94.98 | -34% | | **Net Loss** | $(25.4M) | $(7.7M) | -230% | | **Loss per Share** | $(0.13) | $(0.04) | -225% | - The increase in net loss was primarily driven by a **$9.9 million unrealized loss** on marketable securities due to unfavorable market conditions in Q1 2025[215](index=215&type=chunk) Cost of Extracted Uranium Sold (Q1 2025) | Cost Component | Cost per Pound | | :--- | :--- | | **Cash Costs** | $31.26 | | **Non-Cash Costs** | $14.36 | | **Total Extracted Cost** | **$45.62** | [Liquidity and Capital Resources](index=51&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, the company reported $29.7 million in cash and $35.7 million in working capital, a decrease from year-end 2024, but believes its liquidity is sufficient for the next twelve months Liquidity Position (in thousands) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $29,704 | $39,701 | | **Working capital** | $35,677 | $57,334 | - The company believes its available cash, expected operating cash flows, and potential financing will be sufficient for operations for the next twelve months[226](index=226&type=chunk) - Net cash used in operating activities increased to **$7.7 million** in Q1 2025 from **$3.0 million** in Q1 2024, largely due to payments on the uranium loan[230](index=230&type=chunk)[231](index=231&type=chunk) - Net cash provided by financing activities decreased significantly to **$5.4 million** in Q1 2025 from **$89.8 million** in Q1 2024, due to prior period proceeds from the Alta Mesa JV minority interest sale[230](index=230&type=chunk)[234](index=234&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=53&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is exposed to equity price, uranium price, and foreign currency risks, with no derivative hedging used for uranium price or foreign currency exposure - The company is exposed to **equity price risk**, as common share price volatility could impact its ability to raise capital through equity financing[238](index=238&type=chunk) - The company faces **uranium price risk**, with future sales based on spot and fixed pricing, and does not use derivative instruments to hedge this exposure[240](index=240&type=chunk) - The company is subject to **foreign currency risk** from Canadian Dollar transactions but does not hedge this exposure[241](index=241&type=chunk)[242](index=242&type=chunk) [Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were ineffective as of March 31, 2025, due to material weaknesses in IT and process-level controls, with remediation efforts ongoing - The Acting CEO and CFO concluded that disclosure controls and procedures were **not effective** as of March 31, 2025[243](index=243&type=chunk) - Ineffectiveness stems from ongoing material weaknesses: ineffective **general information technology controls (GITCs)** and poorly designed **process-level control activities** for financial reporting[244](index=244&type=chunk)[248](index=248&type=chunk) - Remediation activities are underway, including recruiting key personnel, developing a risk assessment framework, and establishing a comprehensive GITC evaluation and monitoring program[246](index=246&type=chunk)[247](index=247&type=chunk)[253](index=253&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in a securities class action lawsuit and an arbitration demand from its former CEO, with management currently deeming a loss not probable or estimable for either case - The company and certain officers are defendants in a **securities class action lawsuit** alleging failure to disclose ineffective internal controls and improper cost capitalization under U.S. GAAP[251](index=251&type=chunk) - On April 23, 2025, the company's former CEO filed a demand for arbitration, alleging breach of employment agreement and seeking damages for termination without cause[252](index=252&type=chunk) [Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) The company highlights key risks, including the potential economic impact of tariffs on uranium and other minerals, and the costly, time-consuming nature of ongoing and future litigation - The potential imposition of **tariffs on uranium** could disrupt supply chains and increase costs, materially and adversely affecting business operations[255](index=255&type=chunk) - The company is subject to **litigation risk**, including the current securities class action, which could be costly, time-consuming, and negatively affect the business regardless of outcome[256](index=256&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=56&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2025, the company issued **271,333 common shares** from warrant and stock option exercises, generating **$377,000** in gross proceeds under Securities Act exemptions - In Q1 2025, the company issued **90,000 common shares** from warrant exercises for gross proceeds of **$236,000**[257](index=257&type=chunk) - In Q1 2025, the company issued **181,333 common shares** from stock option exercises for gross proceeds of **$141,000**[257](index=257&type=chunk) [Defaults Upon Senior Securities](index=56&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) None - None[258](index=258&type=chunk) [Mine Safety Disclosures](index=56&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company's operations are not subject to regulation by the Federal Mine Safety and Health Administration - The company's operations are not subject to regulation by the **Federal Mine Safety and Health Administration** under the Federal Mine Safety and Health Act of 1977[258](index=258&type=chunk) [Other Information](index=56&type=section&id=Item%205.%20Other%20Information) None - None[259](index=259&type=chunk) [Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section lists filed exhibits, including various agreements, officer certifications, and Interactive Data Files (iXBRL) - Lists filed exhibits, including a Share Purchase Agreement, a Registration Rights Agreement, an amendment to the Uranium Loan Agreement, and CEO/CFO certifications[260](index=260&type=chunk)

Uranium Production and Sales - A total of 130,015 pounds of uranium ("U3O8") were extracted and processed at a cost of $36.11 per pound[2] - 290,000 pounds of U3O8 were delivered into sales contracts at an average price of $62.89 per pound[2] - The total cost of U3O8 sold in Q1 2025 was $18.262 million for 290,000 pounds, resulting in a cost per pound of $62.97[4] - The extracted total cost for U3O8 was $3.362 million for 73,711 pounds, leading to a cash cost of $31.26 per pound[4] - U3O8 inventory at quarter-end totaled 153,058 pounds at a cost of $40.39 per pound[2] Financial Performance - The company reported a net loss per share of $0.13, compared to $0.04 per share in Q1 2024, primarily due to increased exploration and extraction activity[2] - Cash and equivalents at the end of the quarter totaled $29.7 million, with working capital of $35.7 million[2] Future Projects and Partnerships - Future projects in the pipeline include the Dewey-Burdock project in South Dakota and the Gas Hills project in Wyoming[12] - The company has a joint venture with Boss Energy Ltd., holding a 70% interest in the Alta Mesa Project[11] - The company is committed to working with local communities and indigenous governments to create a positive impact from corporate developments[12]

Core Insights - enCore Energy Corp. reported its financial and operational results for Q1 2025, highlighting significant activities in uranium extraction and sales [1][8] Financial Performance - Total costs of U3O8 sold in Q1 2025 amounted to $18,262,000 for 290,000 pounds, resulting in a cost per pound of $62.97 [4] - The company extracted and processed 130,015 pounds of U3O8 at a cost of $36.11 per pound [7] - The average price for U3O8 sold was $62.89 per pound, with a total of 290,000 pounds delivered under sales contracts [7] - The company reported a net loss per share of $0.13, an increase from $0.04 per share in Q1 2024, attributed to higher exploration and extraction activities and a mark-to-market loss of over $9 million on marketable securities [7] Inventory and Costs - At the end of Q1 2025, the company had an inventory of 153,058 pounds of U3O8, with a total cost of $6,182,000, resulting in a cost per pound of $40.39 [6] - The cash cost of extracted pounds was $2,304,000, translating to $31.26 per pound, while non-cash costs amounted to $1,058,000, or $14.36 per pound [4] Operational Highlights - The company made a cash repayment of $12.2 million on a uranium loan, leading to a negative operating cash flow of $7.7 million [7] - Cash and equivalents stood at $29.7 million, with working capital of $35.7 million at the end of the quarter [7] Company Overview - enCore Energy Corp. is focused on providing clean, reliable, and affordable fuel for nuclear energy, utilizing In-Situ Recovery (ISR) for uranium extraction [10][11] - The company operates the Rosita Central Processing Plant in South Texas and has a joint venture with Boss Energy Ltd. for the Alta Mesa Project [11]

Core Points - enCore Energy Corp. (NASDAQ: EU) is facing a class action lawsuit due to allegations of issuing materially false and misleading statements during the class period from March 28, 2024, to March 2, 2025 [3][4] - The allegations include a lack of effective internal controls over financial reporting, inability to capitalize certain exploratory and development costs under GAAP, and a substantial increase in net losses as a result [3] - The lawsuit claims that the defendants' positive statements about the company's business and prospects were materially misleading and lacked a reasonable basis [3] Class Action Details - Shareholders who purchased shares during the specified class period are encouraged to register for the class action, with a deadline of May 13, 2025, to seek lead plaintiff status [4] - There is no cost or obligation for shareholders to participate in the case, and they will be enrolled in a portfolio monitoring software for status updates [4] - The Gross Law Firm, a nationally recognized class action law firm, is representing the shareholders and aims to protect investors' rights against deceit and fraud [5]