Paladin Energy shares lose 11pc as Langer Heinrich guidance misses expectations
Perth-based Paladin Energy lost 11.3 per cent of its value on Wednesday despite posting a 33 per cent rise in quarterly production from its Langer Heinrich mine in Namibia.
Paladin cranked out 993,843 pounds of triuranium octoxide — a uranium compound — compared with 745,484lb during the prior quarter.
The average realised price of Langer Heinrich's radioactive product dropped $US69.9/lb to $US55.6/lb, while production costs declined from $US40.60/lb to $US37.50/lb.
Output forecasts for the current financial year caused investors to flee.
Production for the financial year is expected to sit between 4 million and 4.4 million pounds of U3O8 with costs between $US44/lb and $US48/lb.
Costs were higher and output lower than what analysts had pencilled in.
Paladin's management pinned the result on higher-than-expected mining and blasting expenses plus grade variability in its stockpiled ore.
The poor result was good news for Paladin's legion of short sellers, who effectively profit when the company's share price tanks.
The portion of Paladin's stock controlled by short sellers is 16.8 per cent, according to Australian Securities and Investments Commission data.
It became the most shorted stock on the ASX last month, taking the unwanted mantle from fellow uranium miner Boss Energy.
Paladin's shares are down 8.1 per cent so far this year and 39.8 per cent compared to 12 months ago.
Paladin is currently facing two class action lawsuits related to production guidance provided last year.
It is alleged the company contravened continuous disclosure rules and had engaged in misleading or deceptive conduct.
Paladin told the ASX in June last year Langer Heinrich would pump out 4mlb to 4.5mlb of its uranium compound for the 2025 financial year.
Quarterly production was well below expectations in October, sparking a 15 per cent share price collapse.
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