Welcome to the Centrus Energy Corporation Q3 2018 Earnings Conference Call. [Operator Instructions]. It is now my pleasure to introduce your host, [indiscernible]. Please go ahead, sir

Good morning. Thank you for joining us. Today's call will cover the results for the third quarter 2018 ended September 30. Here today for the call are Dan Poneman, President and Chief Executive Officer; Marian Davis, Senior Vice President, Chief Financial Officer and Treasurer; and John Dorrian, Controller and Chief Accounting Officer. Before turning the call over to Dan Poneman, I'd like to welcome all of our callers as well as those listening on our webcast. This conference call follows our earnings news release issued yesterday afternoon. We expect to file our quarterly report on Form 10-Q this afternoon. All of our news releases and SEC filings, including our 10-K, 10-Qs and 8-Ks are available on our website. A replay of this call will also be available later this morning on the Centrus' 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 Centrus. 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, November 08, 2018 unless otherwise noted. This call is the property of Centrus Energy. Any transcription, redistribution, retransmission or rebroadcast of this call in any form without the express written consent of Centrus is strictly prohibited. Thank you for your participation. And now, I'll turn the call over to Dan Poneman.

Thank you, Dan and thank you to everyone joining us today. Our results this quarter of $34.1 million in total revenue were in-line with our expectations. We continue to be on track to meet our annual guidance for the year on revenue and end of year cash balance which we are reaffirming today. While the commercial nuclear industry has faced many difficulties in the past decade, I am encouraged about Centrus' future prospects based on the developments we have seen in recent months. Our core nuclear fuel business is getting stronger as we continue to add to our order book. We do business in a highly competitive marketplace, but one advantage we have is that we do not have a high fixed costs that come with a commercial productions facility. We've been able to secure long term supplies from a variety of sources at a time when prices have declined to historic lows and solidify our position as the most diversified supplier in the market. Through September 30, our cost of sales per SWU has declined about 15% compared to the same time last year. We anticipate that it will decline again in 2019, with further decreases in subsequent years because of lower pricing in new supply contracts and contract adjustments on existing contracts. We are starting to see prices firm up at an opportune time. In September the UxC spot price indicator for SWU showed the first increase in 94 months going all the way back to November 2010, and while two months does not make a trend, the spot price indicator went up again in October. With this movement on pricing, we're also starting to see more activity on the demand side in both the U.S. and international markets. Since nuclear fuel is sold under a multi-year contract…

Thank you, Dan and good morning to everyone on the call. We had $34.1 million in revenues in the third quarter, bringing the total to $109.2 million for the first nine months of the year, and we expect that nearly half of our annual revenues will come during the fourth quarter, as has been the case in recent years. As we regularly remind listeners on the call our revenues tend to vary significantly from quarter to quarter based on the timing of when we make our deliveries and the prices under those particular contracts. With most customers signed to multi-year contracts with annual purchase commitments, we recommend investors focus on our annual guidance rather than on any one quarter. We continue to reaffirm our annual guidance of total revenue in a range of $175 million to $200 million. We had a gross profit of $7.8 million this quarter a decrease of $3.5 million compared to the same period of 2017. For the nine months, we had a gross loss of $8.2 million primarily reflecting a greater concentration of LEU sales made under contracts that reflects lower prices under more recent market conditions. As we have noted this quarter and last, we expect our cost of sales to decline in 2019 and subsequent years, which will lead to an improvement in the gross profit measure. Advanced technology license and decommissioning cost, which consists of American Centrifuge expenses that are outside of the company's contract with Oak Ridge National Laboratory, increase $1.3 million for the quarter and $4.2 million for the nine month period compared to 2017, reflecting additional spending on the terminations of our NRC license and the DOE license for the American Centrifuge facility in Piketon, Ohio. With the D&D work at Piketon complete, most costs at the facility are…

Thank you, Marian. I want to offer one final comment today. Over the past few years Centrus, like many others in the industry, has worked through a period of profound change while facing significant challenges in a very difficult market. The past three years have demonstrated that we have an incredible team assembled that can find solutions and execute on them even against imposing odds. But now things are changing. Separative work unit prices appear to have finally stopped their slide, demand is picking up, our supply costs are going down. We are winning new sales. We are not just a fuel company anymore. We are working on advanced reactor fuel, we are an advanced manufacturer, we are a D&D contractor. We have developed revenue producing activities today that did not exist at Centrus three years ago, and we've only just begun to scratch the surface of what our technical team can do. I want to thank our brilliant, innovative, tenacious employees who have never failed to deliver for us, and I cannot wait to write the next chapter with you. Finally, I want to thank our investors for your support of Centrus over the years. No one ever said that this would be easy or that success would happen overnight, but as more and more customers see the value the Centrus can provide, I am convinced that will build value for our investors and stakeholders as well. Operator we are happy to take any questions at this time.

[Operator Instructions]. Our first question is from Joshua Nahas of Foxhill Capital. Please go ahead.

[Operator Instructions]. We have no further questions. Do you have any closing comments?

Thank you, Operator. That will conclude our third quarter 2018 investor call. I want to send a thank you to our listeners online and our investors who call in. We look forward to speaking with you again next quarter.