DBRS Releases Report on Cameco Corporation

DBRS has today released a report on Cameco Corporation (Cameco or the Company) that provides further detail on the April 21, 2014, confirmation of the Company’s ratings.

Cameco’s Issuer and Senior Debt rating of A (low) and Commercial Paper rating of R-1 (low), each with a Stable trend, reflect the Company’s strong business profile as one of the world’s largest uranium producers, its cost-competitive operations and the higher-than-normal operational risks related to the nuclear industry. Cameco has embedded a range of risk-aversion features in its operations, which have reduced – and are expected to continue to reduce, earnings volatility.

The Company’s business profile narrowed materially in early 2014 with its sale of its interests in nuclear electricity generator Bruce Power Limited Partnership, which is expected to be partially offset by ongoing increases in primary uranium output. As well, Cameco’s credit metrics have weakened since the serious nuclear accident at the Fukushima Daiichi power plant in Japan in 2011 weakened near-term markets for uranium. Despite the weakness, Cameco’s operating cash flow improved in 2013 mainly due to higher realized uranium prices and contribution from NUKEM Energy GmbH acquired in early 2013.

Cameco continues to face high operational risks related to Cigar Lake and other operations as well as major income tax reassessments. Further significant operational or tax-related setbacks or a prolonged slump in the uranium market could result in a downgrade of Cameco’s ratings.

Today’s report and the April 21, 2014, press release are available at www.dbrs.com or by contacting us at info@dbrs.com.