S&P Assigns BB Rating to Navoiyuran

Photo: Consulate General of the Republic of Uzbekistan in Aktau

S&P Global Ratings has assigned a long-term foreign and local currency credit rating of BB- to Navoiyuran, which is marked as stable.

This stable outlook is based on expectations that the company will sustain its current production levels and profitability amid favorable uranium prices and low operational costs. In 2023, Navoiyuran accounted for 7.4% of global uranium production; however, it faces challenges in diversifying its operations, as all activities are concentrated in Uzbekistan. Notably, 75% of its production is derived from a single complex.

The agency noted the company’s high profitability, reporting an EBITDA margin of 65.3% in 2023. This margin is projected to grow to 80% in 2024 due to anticipated increases in uranium prices and continued low costs. However, fluctuations in uranium prices and limited reserves—enough for about 11 years of production—pose long-term risks.

Navoiuran plans to expand its production capacity through joint ventures with foreign partners, intending to invest between $50 mln to $150 mln annually in these projects.

Despite its strong financial performance, Navoiyuran’s rating is constrained by its reliance on government policy, as the Uzbek government wholly owns it. This ownership exposes the company to potential government interventions, including the redistribution of revenues in favour of the state, according to experts.

Kursiv Uzbekistan also reports that China National Uranium Corporation (CNUC) will assist Uzbekistan in establishing a uranium mining center.