Paladin Energy Shares Fall 8% as Langer Heinrich Costs Rise and Uranium Output Dips

Unit cost increases, reduction in uranium production at Langer Heinrich during September quarter stated Paladin Energy.

Stocks in Paladin Energy (ASX: PDN) were heavily hit on Wednesday after the uranium miner reported reduced uranium production and increased unit costs at its Langer Heinrich uranium mine in Namibia during the September quarter.

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Stocks of the uranium company were seen down about 7–8% during morning trade around A$7.40, after the release of the quarterly report for the quarter ending 30 September 2026.

During the quarter, production at Langer Heinrich uranium mine was 1.00 million pounds of uranium oxide (U₃O₈), compared with 1.23 million pounds during June quarter. Sales volume was 1.16 million pounds, compared with 1.35 million pounds previously. Realised price was increased to US79.4 per pound from US70.6 per pound, owing to increased prices of uranium along with increased proportion of market related agreements.

Cost of production was increased to US61.6perpoundfromUS51.6 per pound in previous quarter. Capital expenditure at the mine was US6.9 million,compared with US 5.1 million.

What drove the weaker quarter

The Paladin indicated that its production has been impacted by scheduled shutdowns for maintenance and plant recovery that occurred at the low end of the targeted range. The firm cited some ore properties tied to its mining pattern in the J-pit, as well as lower uranium inventories in the processing plant during the beginning of the reporting period.

Plant recovery declined to 85% from 90% in the prior quarter. Grades in the ore feed were more or less the same. Slight improvement was noted in mining tonnage, with 7.73 million tonnes being moved compared to 7.45 million tonnes in the previous quarter.

Speaking on behalf of the company, managing director and CEO Paul Hemburrow noted that the results for the quarter were in line with the anticipated shutdown and pit transition. Grades in the feed, plant performance and inventory improved in September. Production is expected to increase in the second half of FY2027.

Full-year guidance unchanged

The company confirmed its FY2027 forecast for Langer Heinrich, which consists of producing 5.1 million to 5.6 million pounds of U₃O₈ with a cost of production of US44-US48 per pound. There is anticipation of higher production levels in the latter part of the year owing to higher quality ore being processed in the plant.

The forecast was initially released in July 2026, following the completion of its ramp up operations in the June quarter of FY2026. During FY2026, Langer Heinrich produced 4.82 million pounds with a cost of production of US$43.3 per pound.

As at 30 September 2026, Paladin had cash and cash equivalents of US209milliontogetherwithacommitted,undrawnUS70 million revolving credit facility.

Broader context for the Namibian operation

Langer Heinrich is the only producing property of Paladin. The company owns 75% in this project while data is stated on 100% basis. 2026 fiscal year was the period where Paladin moved from restart and ramp-up stage to steadier phase of its operations since now all ores are mined and not sourced from stockpile anymore.

Unit costs are highly dependent on production volumes. Decrease in quarterly production volume means spreading of fixed costs among fewer number of pounds resulting in increase in cost of production. It was stated by the company that its cost will continue increasing in the first half of 2027 fiscal year due to scheduled maintenance.

Canadian growth project progress

The PLS project located in Saskatchewan, Canada, saw some progress from Paladin during its update on the Namibia operations. This is evident from a signed Mutual Benefits Agreement with the Birch Narrows Dene Nation and an Administrative Protocol with the Canadian Nuclear Safety Commission in order to complete hearings on the construction licence application by the end of 2027.

There was further drilling which helped extend mineralisation at several sites. This project is the long-term growth project of the company with production expected by 2031.

What investors will watch

The immediate emphasis, however, is on meeting the higher production expected in the second half of the year in order for Langer Heinrich to hit the full-year forecasts. Unit cost, plant availability and high-grade ore production will be the metrics of concern in the December and March quarters.

Uranium price changes and contract versus spot-based revenue mix will be among the influences on realized pricing. Paladin’s contractual commitments give it some upside as the price increases, as seen in the September quarter.

Performance at a single-producing mine is inherently risky. Disruption of mining operations or processing or logistical issues at Langer Heinrich will have an immediate effect on group results. Other external issues that may influence guidance assumptions are still under watch by the company.

What happened in the September quarter was an interim increase in unit cost and a lower production target rather than an indication of changing the full-year forecast. The success or failure of meeting the reiterated FY2027 targets will determine the market’s view of future performance at Langer Heinrich.

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