Deep Yellow’s A$9.2M Cash Burn Raises Questions on Exploration Pace Despite Strong Reserves
Deep Yellow Ltd disclosed a quarterly cash flow report for Q1 2025, revealing a significant operating cash outflow but a robust cash reserve that supports an estimated 20 quarters of funding runway.
- Operating cash outflow of A$9.194 million for the quarter
- Investing cash outflow of A$2.319 million primarily on exploration and evaluation
- Cash and cash equivalents at quarter-end stood at A$227.366 million
- Payments of A$638k to related parties for management and consulting services
- Estimated funding runway of approximately 20 quarters based on current cash and outgoings
Quarterly Cash Flow Overview
Deep Yellow Ltd, a uranium exploration company listed on the ASX, released its quarterly cash flow report for the period ending 31 March 2025. The report highlights a net cash outflow from operating activities of A$9.194 million, reflecting ongoing investment in exploration and evaluation activities. Despite this cash burn, the company maintains a strong liquidity position with cash and cash equivalents totaling A$227.366 million at quarter-end.
Investing and Financing Activities
Investing activities during the quarter resulted in a net cash outflow of A$2.319 million, primarily attributable to payments for exploration and evaluation. Notably, no proceeds were generated from disposals or financing activities, and the company did not draw on any financing facilities during the quarter. This conservative approach underscores Deep Yellow’s reliance on its substantial cash reserves to fund ongoing operations and exploration efforts.
Related Party Payments
The report discloses payments totaling A$638,000 to related parties and their associates. These payments include fees for management and consulting services rendered by key executives and non-executive directors, such as John Borshoff, Managing Director, and Gillian Swaby, Executive Director. Such disclosures are critical for transparency and governance, reassuring investors about the nature and scale of related party transactions.
Funding Runway and Future Outlook
Based on current cash outflows and available cash, Deep Yellow estimates it has approximately 20 quarters of funding available, a notably long runway that provides operational flexibility. The company also expects to receive approximately A$11.4 million during FY25 and FY26 from research and development refunds, outstanding VAT refunds, and loan repayments related to Loan Plan Shares issued to personnel. This anticipated inflow further strengthens the company’s financial position.
While the report does not detail specific exploration milestones or production targets, the strong cash position combined with disciplined expenditure suggests Deep Yellow is well-positioned to advance its uranium exploration projects without immediate capital raising needs.
Bottom Line?
Deep Yellow’s robust cash reserves and extended funding runway provide a solid foundation as it navigates the next phase of uranium exploration.
Questions in the middle?
- What are the company’s near-term exploration milestones and expected capital requirements?
- When precisely does Deep Yellow anticipate receiving the forecasted A$11.4 million in refunds and repayments?
- How will the company balance ongoing cash burn with potential market or commodity price fluctuations?
