One ASX uranium share is finding support from investors today after releasing its latest quarterly report.
Shares in Deep Yellow Limited (ASX: DYL) are attracting investors on the first day of the week, rising 1.8% to $1.23. It's not quite enough to make it a top gainer, but it does mean the uranium mine developer is outpacing the S&P/ASX 200 Index (ASX: XJO) on a solidly green day for the Australian share market.
Deep Yellow's showing was all the more impressive in morning trade. Around 11am, the company's shares reached a session high of $1.27, representing an increase of 5.4% from Friday's closing price.
What did the ASX uranium share report?
Here are the key takeaways from Deep Yellow's quarter that ended 30 June 2024:
- Net cash outflow from operations of $37,000
- Successful completion of $250 million capital raise
- Preferred contractor selected for detailed engineering of Tumas project
- Finished the quarter with $257.5 million in cash and cash equivalents
On 4 June, Deep Yellow selected Ausenco Services as its preferred engineering, procurement, and construction management contractor on the Tumas uranium project. Based in Namibia on Africa's south-west coast, Tumas awaits Deep Yellow's final investment decision, which is expected in the third quarter of this year.
Additional drilling was undertaken at Tumas during the latest quarter. The program's findings are being prepared for a revised mineral resource estimate to be published early next month. Currently, the company's commissioning target of third-quarter 2026 still holds.
What else happened in the quarter?
The pre-production company joined the ASX 200 index in June. The addition of the uranium share to Australia's benchmark arose from Silver Lake Resources' booting following its acquisition by Red 5 Limited (ASX: RED).
In other news, the quarter was an important one for Deep Yellow's finances. After running down its coffers over the last two years or so, the ASX uranium share finished replenishing its reserves in May with the completion of a second tranche placement to raise $79.5 million.
On 31 December 2023, Deep Yellow only counted $25.1 million in cash. Now, that figure is $257.5 million, giving the uranium developer enough funding to continue working on bringing its Tumas and Mulga Rock projects to life.
As shown in the chart above, Deep Yellow shares strengthened from $1.55 to a 52-week high of $1.82 in the three weeks following the capital raise.
What's next for this ASX uranium share
According to today's quarterly report, Deep Yellow anticipates completing financing, marketing, and the creation of a control capital cost estimate during the second half of this year. Following the final investment decision, equipment and site preparation works will begin early next year.
The Western Australian project (Mulga Rock) awaits a revised definitive feasibility study (DFS) to include base metals and rare earths. Deep Yellow expects the findings to be completed by the end of the second calendar quarter of 2025.
Lastly, the company points towards possible increases in uranium prices in the second half. The supposed catalyst relates to whether 'waivers are granted or denied under the US-Russian nuclear fuel ban and escalating uranium supply concerns are increasingly appreciated by the utility market'.
Deep Yellow share price snapshot
Shares in the ASX uranium company are up 88% over the last year, coinciding with a rapid rally in the nuclear-powering commodity.
However, much like the commodity price, momentum in Deep Yellow shares has petered out since March. Nevertheless, Deep Yellow's performance places it among the top 10 highest one-year returns inside the ASX 200.
