Company: LEU
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001065059-25-000024
Chunk: 45

Company: CENTRUS ENERGY CORP
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 1
Chunk 45
---
 of specific contracts, the customer may be able to increase or decrease the quantity delivered within an agreed range.Technical Solutions SegmentRevenue for the Technical Solutions segment, representing the Company’s uranium enrichment, advanced manufacturing, and other technical services offered to public and private sector customers, is recognized over time as the performance obligation is satisfied or at the point in time in which each performance obligation is fully satisfied. The Company’s work on HALEU began under the HALEU Demonstration Contract, signed with the DOE in 2019 to construct a cascade of 16 centrifuges to demonstrate production of HALEU for advanced reactors. The DOE reimbursed the Company for 80% of its costs incurred in performing the contract. The DOE has funded the contract up to $173.0 million with a period of performance that ended November 30, 2022. The Company recorded revenue up to the funded amount of $173.0 million and has received aggregate cash payments under the HALEU Demonstration Contract of $171.2 million through March 31, 2025. Closeout activities on the HALEU Demonstration Contract are ongoing. In 2022, the DOE elected to change the scope of the HALEU Demonstration Contract and moved the operational portion of the contract to the new, competitively-awarded HALEU Operation Contract that would provide for a longer period of operation and HALEU production than would have been possible under the HALEU Demonstration Contract. On November 10, 2022, the DOE awarded the HALEU Operation Contract to the Company with a base contract value of approximately $150.0 million in two phases through 2024. Phase 1 included an approximately $30.0 million cost-share contribution from Centrus matched by approximately $30.0 million from the DOE to complete construction of the cascade, begin operations and produce the initial 20 kilograms of HALEU UF6 by no later than December 31, 2023. On November 7, 2023, the Company announced that it made its first delivery of HALEU to the DOE, completing Phase 1 by successfully demonstrating its HALEU production process.  

16

During November 2023, the Company transitioned to Phase 2 of the HALEU Operation Contract which includes production of 900 kilograms of HALEU UF6 per year as well as continued operations and maintenance. The Company is being compensated on a cost-plus-incentive-fee-basis, with an initial Phase