Revenue

12 Months Ended

Dec. 31, 2019

17. Revenue

Cameco’s sales contracts with customers contain both fixed and market-related pricing. Fixed-price contracts are typically based on a term-price indicator at the time the contract is accepted and escalated over the term of the contract. Market-related contracts are based on either the spot price or long-term price, and the price is quoted at the time of delivery rather than at the time the contract is accepted. These contracts often include a floor and/or ceiling prices, which are usually escalated over the term of the contract. Escalation is generally based on a consumer price index. The Company’s contracts contain either one of these pricing mechanisms or a combination of the two. There is no variable consideration in the contracts and therefore no revenue is considered constrained at the time of delivery. Cameco expenses the incremental costs of obtaining a contract as incurred as the amortization period is less than a year.

The following table summarizes Cameco’s sales disaggregated by geographical region and contract type and includes a reconciliation to the Company’s reportable segments (note 28):

For the year ended December 31, 2019



	Uranium		Fuel services		Other		Total


Customer geographical region

Americas	$	569,535	$	206,226	$	59,300	$	835,061
Europe		288,134		79,629		3,587		371,350
Asia		556,140		84,422		15,952		656,514

	$	1,413,809	$	370,277	$	78,839	$	1,862,925


Contract type

Fixed-price	$	349,021	$	305,383	$	69,703	$	724,107
Market-related		1,064,788		64,894		9,136		1,138,818

	$	1,413,809	$	370,277	$	78,839	$	1,862,925

For the year ended December 31, 2018



	Uranium		Fuel services		Other		Total


Customer geographical region

Americas	$	695,678	$	191,791	$	69,012	$	956,481
Europe		275,096		50,000		10,693		335,789
Asia		713,282		72,198		13,911		799,391

	$	1,684,056	$	313,989	$	93,616	$	2,091,661


Contract type

Fixed-price	$	577,143	$	293,400	$	83,706	$	954,249
Market-related		1,106,913		20,589		9,910		1,137,412

	$	1,684,056	$	313,989	$	93,616	$	2,091,661

Deferred sales

The following table provides information about contract liabilities (note 14) from contracts with customers:


		2019		2018


Beginning of year	$	30,727	$	29,148
Additions		9,783		25,695
Recognized in revenue		(23,067)		(24,025)
Effect of movements in exchange rates		(25)		(91)

End of year	$	17,418	$	30,727

Deferred sales primarily relates to advance consideration received from customers for future conversion deliveries and fuel fabrication services as well as revenue related to the storage of uranium and converted uranium held at Cameco facilities. The revenue related to the fuel fabrication services and storage is recognized over time while the revenue related to future conversion deliveries is expected to be recognized between 2020 and 2025.

Cameco recognized $78,000 of revenue (2018 - $5,468,000 reduction of revenue) during 2019 from performance obligations satisfied (or partially satisfied) in previous periods. This is due to the difference between actual pricing indices and the estimates at the time of invoicing.

Future sales commitments

Cameco’s sales portfolio consists of short and long-term sales commitments. The contracts can be executed well in advance of a delivery and include both fixed and market-related pricing. The following table summarizes the expected future revenue, by segment, related to only fixed-price contracts with remaining future deliveries as follows:



		2020		2021		2022		2023		2024		Thereafter		Total


Uranium	$	271,642	$	183,422	$	145,920	$	169,234	$	166,015	$	532,429	$	1,468,662
Fuel services		274,755		265,126		212,562		150,266		150,773		593,612		1,647,094
Other		4,030		4,212		-		-		-		-		8,242

Total	$	550,427	$	452,760	$	358,482	$	319,500	$	316,788	$	1,126,041	$	3,123,998

The sales contracts are denominated largely in US dollars and converted from US to Canadian dollars at a rate of $1.30.

The amounts in the table represent the consideration the Company will be entitled to receive when it satisfies the remaining performance obligations in the contracts. The amounts include assumptions about volumes for contracts that have volume flexibility. Cameco’s total revenue that will be earned will also include revenue from contracts with market-related pricing. The Company has elected to exclude these amounts from the table as the transaction price will not be known until the time of delivery. Contracts with an original duration of one year or less have been included in the table.