Good day, ladies and gentlemen, and welcome to the first quarter 2010 USEC, Inc. earnings conference call. My name is Diana and I'll be your operator for today. (Operator Instructions) Now, I'd like to turn the conference over to your host for today, Mr. Steve Wingfield, Director of Investor Relations. Please proceed.

Good morning. Thank you for joining us for USEC's conference call, regarding first quarter of 2010, which ended March 31st. With me today are John Welch, President and Chief Executive Officer; John Barpoulis, Senior Vice President and Chief Financial Officer; Phil Sewell, Senior Vice President; Bob Van Namen, Senior Vice President and Tracy Mey, Controller and Chief Accounting Officer. Before I turn the call over to John Welch, I want to welcome all of our callers, as well as those listening to our webcast via the Internet. This conference call follows our earnings news release issued yesterday after the markets closed. That news release is available on many financial websites, as well as our corporate website, USEC.com. I want to inform all of our listeners that our news releases and SEC filings, including our 10-K, 10-Qs and 8-Ks are available on our website. We expect to file our quarterly report on 10-Q later today. A replay of this call will also be available later this morning on the USEC website. I'd like to remind everyone that certain of the information that we may discuss on this call today may be considered forward-looking information that involves risk and uncertainty, including assumptions about the future performance of USEC. Our actual results may differ materially from those in our forward-looking statements. Additional information concerning factors that could cause actual results to materially differ from those in our forward-looking statements is contained in our filings with the SEC, including our annual report on Form 10-K and quarterly reports on Form 10-Q. Finally, the forward-looking information provided today is time sensitive and is accurate only as of today May 5, 2010. This call is the property of USEC. Any redistribution, re-transmission or rebroadcast of this call in any form without the express written consent of USEC is strictly prohibited. Thank you for your participation And now I'd like to turn the call over to John.

Good morning and thank you for joining us this morning to discuss our first quarter results. Over the course of the next few minutes, I will address our progress on the American Centrifuge technology since the first of the year. I will also briefly discuss our financial results for the first quarter, our outlook for 2010 and provide sufficient time for your questions. Taking a look at the bottom line, we reported a net loss for the quarter of $9.7 million compared to a net loss of $2.1 billion in the first quarter of 2009. Our results in the 2010 first quarter were significantly affected by a one-time charge of $6.5 million related to a change in tax treatment of Medicare reimbursements resulting from the recently enacted healthcare legislation. Many of the activities we are working on to address DOE's concerns about technical aspects of the American Centrifuge are expensed under accounting rules and the $25.7 million in advanced technology expenses in the first quarter also had the effect of reducing our earnings. Absent the Advanced Technology expense and the one time tax related charge, we would have reported positive earnings for the quarter. And despite reporting a loss, our revenue of $345 million was on target and the gross profit margin of 7.7% was higher than our expectations for the quarter. As you will recall, we began de-mobilizing and reducing construction and machine manufacturing activities for the American Centrifuge project in August 2009. Although, Advanced Technology expense was significant in the first quarter, it was approximately $6 million less than the same quarter last year and capitalized spending in the first quarter was $93 million less than in the same period of 2009. So although, we reduced construction and machine manufacturing activities, there continues to be spending related to…

Thanks, John and good morning, everyone. Starting with revenue for the quarter, total revenue was $345 million, a decrease of $161 million or 32% from the same quarter last year. SWU sales made up the majority of revenue and totaled $267 million. That was also $161 million lower than the same period last year. Those who have followed USEC for a while know that our revenues can swing significantly from quarter-to-quarter and in some cases year-to-year. In 2009, SWU volume increased 30% compared to 2008 due to the timing of utility customer refuelings. In the first quarter, SWU volume was 41% lower than the same quarter of 2009, but for the year we have reiterated our guidance that SWU volume will be just 15% lower in 2010 compared to last year. As SWU contracts that we have signed in recent years at higher prices and with price adjusters become a larger portion of our backlog, we are seeing an increase in average prices billed to customers. In the first quarter, average prices billed to customers rose 5% year-over-year. Uranium revenue was $16 million in the first quarter, which was a decrease of $13 million, compared to the same quarter of 2009. Both uranium prices and volumes sold declined. Uranium market prices declined in 2009 and have been trading in the low $40 a pound. As a short bit of background for anyone who is new to USEC, we underfeed the enrichment process when it makes economic sense. We can obtain uranium for resale by using more electric power and using less natural uranium feedstock. The economics of underfeeding the enrichment process, however, are affected by uranium prices and the cost of electric power. Turning back to revenue, the U.S. government contract segment revenue for the quarter was $63 million, an…

(Operator Instructions). The first question will come from the line of Laurence Alexander. Please proceed. Laurence Alexander – Jefferies: Good morning.

Good morning, Laurence. Laurence Alexander – Jefferies: I guess just a couple of questions. First of all, could you elaborate a little bit on whether there is any constraint in your credit agreements on the ACP investments that you need to do this year. And give us an update on how much flexibility you have on that?

Sure, Laurence. Yes, there are – there is a covenant in our credit facility and we're very cognizant of the spending limitations within the credit agreement. The intent of this covenant is an effect to preserve an adequate portion of the revolving credit facility for the working capital needs of our existing operations, something we are clearly aligned with our lenders. And with this in mind, the ACP spending covenant provides for certain flexibility. First, for each additional dollar of lender commitments that we receive through an accordion feature within the credit facility, we can increase the spending basket dollar for dollar up to a maximum of $165 million under the credit facility. In addition, the recently executed DOE cooperative agreement, which provides $45 million available for the project, that is not restricted by the credit facility covenant. And in addition, there are additional long-term cap – any additional long-term capital raised can also be invested in ACP but subject to the credit facility provisions. Ultimately, we recognize that we cannot continue at our existing rate of investment in the project without near term progress in each of those areas. The current limitation in the covenant is $90 million and again, we are looking to increase that, raise capital or utilize the DOE cooperative agreement to provide for some flexibility around that. Laurence Alexander – Jefferies: And I guess, secondly on the TVA, could you give us an update on your thoughts about, sort of, extending our supply agreement and whether or not they will be giving you flexibility around the amount of power supplied to Paducah?

Yes. This is Bob Van Namen. We are in discussions with TVA and we'll continue to do, so probably over the next six to nine months. Just a reminder that the current contract with TVA has firm pricing out through May 2012 and at that point we would engage in an extension depending on several factors, including the power costs, the market prices for enrichment and the demand we see out in the market. And I think it will be a good conversation with TVA. Clearly the economy has taken a downturn across the country and in the Tennessee Valley and I think that are load is very important to them. We do see it being a good robust discussion and we are also looking at alternate suppliers for power in addition to TVA. Laurence Alexander – Jefferies: And then, I guess, lastly if I may, could you address, sort of, the trends in the realized margins on the Russian contract, with respect on the last couple of years and how you think it is going to play out over the next couple? And also whether Paducah on a standalone basis is free cash flow positive enough to cover your debt?

Laurence its John Barpoulis. Let me address the first half and then I'll turn it over to Bob for any commentary on Paducah. Recalling again from our standpoint, we do not look at allocating per se gross profit margin by production source. Our inventory is combined and we look at our collective sources and our collective sales., but specifically we do analyze clearly cost trends on that side of the ledger and to that extent I know that we've described that in the past two years the cost under the Russian purchase – Russian HEU agreement did increase about 11% in each of the prior two years, but we're expecting about 8% this year. And that was very much the result of the negotiations that Phil Sewell and this team undertook last year with the Russians to come up with a mutually agreeable modification to the overall pricing mechanism. And so it was through those negotiations, which again mutually agreeable and accepted by both sides, that provides for greater certainty from our perspective around the future costs of the Russian purchases and aligns those better with our anticipated revenue pricing over the coming years. Bob?

Just a couple of comments on Paducah. As John said, we do not look at the margin on a source specific basis, but a couple of comments on the trends. We are operating the Paducah facility at an all time peak in efficiency with a lot of equipment online allowing us to very efficiently utilize the power that we get from TVA. Power costs have taken a turn down compared – or at least the fuel cost adjusters have compared to where we were anticipating them to be given plentiful rainfall and lower commodity costs in the energy markets. So the power outlook definitely is better than we would have thought. And Paducah continues to benefit from its ability to underfeed and to create uranium which gives us extra ways to monetize the power and to be able to get the economic benefits out of the operation of the plant. So we are pleased with the way Paducah is operating. We believe that again given the constraints we have on power cost and market availability and SWU prices that we can continue to operate the plant well into the future, as long as the market needs it. So it is still a very valuable asset for the company and for the country. Laurence Alexander – Jefferies: Thank you.

Thanks, Laurence.

And the next question will come from the line of Gabriela Bis with Goldman Sachs. Please proceed. Gabriela Bis – Goldman Sachs: Good morning.

Good morning, Gabi. Gabriela Bis – Goldman Sachs: So two questions. First, would be with the exception of the additional machine hours on the Lead Cascade that you're completing right now, are there any other technical hurdles you're aware of that you need to meet before being able to reapply for the loan guarantee this summer?

This is John. I think, as you know, there were a series, that we've described the series of technical issues that were recorded in the Parsons report and that we are addressing the – many of them are addressed by the operation of Lead Cascade, because the operation of Lead Cascade has demonstrated the production of – as we've said, about two dozen AC100 machines. So that is continuing to flex our supplier base. The $90 million cost sharing will continue that process with an overall average of about eight machines per month that we will continue to build out. So a lot of the issues associated with supplier base readiness, quality assurance, running the machines effectively all get tied up into the operation of Lead Cascade. There are some other costs modeling type of issues that are reflective of how we estimate to operate the plant and then actually do flow of materials, things like that. But the majority of them are wrapped up in that Lead Cascade operation. Gabriela Bis – Goldman Sachs: Great. Thank you for that color. And then a second point is relating to your $90 million cost share program with the DOE. I was wondering, if you can provide us a little bit more color on how it is reflected in your P&L and balance sheet. I know that the reimbursement from the government is reflected in other income, but USEC's share of the agreement, the $45 million that they are going to be able to spend, how does that get reflected? Is it something that's reflected in the APC costs, on the income statement or is it more CapEx in the cash flow statement?

I think under – this is John Barpoulis, Gabi. Under the cooperative agreement, the bulk of the qualifying expenditures are captured in the ACP expense side and so there are some, I believe that may filter into capital expenditures, but the bulk are related to ACP expense. Gabriela Bis – Goldman Sachs: That'd be helpful. And then on the balance sheet side, can you walk us through how that gets reflected?

Balance sheet – on the balance sheet, what you will see in the 10-Q will be a reduction in our depleted uranium liability, but you'll also see an increase in our advances from customer. So we've got an advance from DOE to provide that funding. Gabriela Bis – Goldman Sachs: Okay. Great. And lastly, if I may, do you know when you think you will be ready to provide investors with an update on the cost of the ACP? Is it around the time of when you're going to be refiling your loan application?

I think that's a pretty fair assessment. To be able to update the application of the loan guarantee, there will be a whole new update on cost based on what we know at that point in time and we will be disclosing that around that timeframe.

And just to clarify, we are updating our application in the process. We are not resubmitting, but it will be a fulsome update to the application. Gabriela Bis – Goldman Sachs: Got it. Thank you very much.

(Operator Instructions). Your next question will come from the line of Baker Burleson with Fox Point Capital. Please proceed. Baker Burleson – Fox Point Capital: Hey, guys. Good morning.

Good morning.

Good morning. Baker Burleson – Fox Point Capital: Kind of, following up on what Gabby was asking there – I know you cannot get too far into the details, being that you have the strategic review going on and what not, but as we think through in the update for ACP last night you mentioned needing more capital in excess of the $2 billion. Can you just walk us through timing? Does that come before you update the application or is that part of the update of the application? Just, kind of, the timing of how that's going to play out maybe over the course of the year.

It's John Barpoulis. And let me address that in a couple of ways. I think with respect to the loan guarantee application, clearly, as we are providing that information, we'll be working with the loan guarantee office to provide a sense of certainty and predictability around the capital required in order to complete the plant. And so, as we've described the overall sources for deployment of ACP, it is through cash generated by USEC operations. It will be loan guarantee debt funding, as well as indicated here additional capital required for deployment. The amount timing of that will be very much a function of our work on the cost side and the determination – one of Gabi's questions getting to the timing around when we would expect to have a much better view of an update on the cost side. And so that's the first part. The second part, we have described in the past that we are evaluating our strategic alternatives. That is specifically with respect to that capital and as I'm sure you can appreciate, there's not much that I can say on that front. Baker Burleson – Fox Point Capital: Maybe just as a follow-up, can I ask is having the additional capital secured a requirement of updating the DOE application?

That will very much be a function of our discussions with the loan guarantee office. It's ultimately providing additional comfort to DOE around the timing and amounts of capital required to complete the plan. Baker Burleson – Fox Point Capital: Okay. Thanks very much.

Okay. Thank you.

We do have a follow-up question from the line of Gabriela Bis. Please proceed. Gabriela Bis – Goldman Sachs: Hi. Just to follow-up on timing of the loan guarantee application. If you do provide the update in the summer, do you know how long the process will take for the DOE to review that and provide some sort of resolution or decision?

Well, this is John again. We would not presume to speak for the loan guarantee office regarding schedule for review. But, again, I would say that it is an update rather than a new application and the office is certainly familiar with our program. We hope to work with the office to move forward as expeditiously as possible. Gabriela Bis – Goldman Sachs: So your understanding is it wouldn't be necessarily as long of a process as it was last time, it might be more of an expedited process?

We hope so. Gabriela Bis – Goldman Sachs: Thank you.

There are no more questions in the queue. I'd now like to turn the call over to John Welch, CEO for closing remarks.

Thank you all for participating in the call this morning. I think, clearly, you can see that we have made significant progress in recent months and we're working hard to continue that progress as we prepare to update our bigger application to the loan guarantee office this summer. We appreciate your support; we'll keep you up-to-date as everything evolves. And your interest and investment is appreciated. Thank you.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation. You may now disconnect and have a great day.