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Basis of Presentation | 9 Months Ended
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Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Basis of Presentation | BASIS OF PRESENTATION Basis of Presentation and Principles of Consolidation The unaudited condensed consolidated financial statements of Centrus Energy Corp. (“Centrus” or the “Company”), which include the accounts of the Company, its principal subsidiary United States Enrichment Corporation and its other subsidiaries, as of September 30, 2018, and for the three and nine months ended September 30, 2018 and 2017, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The condensed consolidated balance sheet as of December 31, 2017, was derived from audited consolidated financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States (“GAAP”). In the opinion of management, the unaudited condensed consolidated financial statements reflect all adjustments, including normal recurring adjustments, necessary for a fair statement of the financial results for the interim period. Certain prior year amounts have been reclassified for consistency with the current year presentation. Certain information and notes normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations. All material intercompany transactions have been eliminated. Operating results for the three and nine months ended September 30, 2018, are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes and Management's Discussion and Analysis of Financial Condition and Results of Operations included in the Annual Report on Form 10-K for the year ended December 31, 2017. Correction of Error In the second quarter of 2018, Management identified a classification error for $0.3 million of costs that had been previously included in Cost of Sales for the Contract Services Segment in the condensed consolidated statement of operations for the three months ended March 31, 2018. These costs are now included in Advanced Technology License and Decommissioning Costs in the condensed consolidated statement of operations for the nine months ended September 30, 2018. The Company considered quantitative and qualitative factors in assessing the materiality of the classification error and determined that the classification error was not material. This revision had no impact to the Company’s net loss for the three months ended March 31, 2018 or the nine months ended September 30, 2018. New Accounting Standards Recently Adopted Accounting Standards In 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, which requires revenue to be recognized when a customer obtains control of promised goods and services at an amount that reflects the consideration the Company expects to receive in exchange for those goods and services. In addition, ASU 2014-09 and subsequent amendments, collectively known as Accounting Standards Codification (“ASC”) 606 (“ASC 606”) require certain additional disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows arising from contracts with customers. The Company adopted ASC 606 on January 1, 2018, using the modified retrospective method. The new standard was applied to contracts that were not completed as of the adoption date. The Company recognized the cumulative effect of initially applying ASC 606 of $0.1 million as an adjustment to the opening balance of accumulated deficit. The comparative information has not been restated and continues to be presented according to accounting standards in effect for those periods. Refer to Note 2, Revenue Recognition and Contracts with Customers, for additional information. The following table summarizes the cumulative effect of the changes to the Company’s condensed consolidated balance sheet as of January 1, 2018, from the adoption of ASC 606 (in millions):
| Balance at December 31, 2017 |  | Adjustment for ASC 606 |  | Balance at January 1, 2018
Assets: |  |  |  |  |
Unbilled contract revenue | $ | — |  |  | $ | 0.1 |  |  | $ | 0.1 |
Stockholders’ Deficit: |  |  |  |  |
Accumulated Deficit | (284.5 | ) |  | 0.1 |  |  | (284.4 | )
The following table summarizes the impact of adopting ASC 606 on revenue and net loss for the three and nine months ended September 30, 2018 (in millions):
| Three Months Ended September 30, 2018 |  | Nine Months Ended September 30, 2018
| As Reported |  | Under Previous Accounting |  | Effect of Adoption |  | As Reported |  | Under Previous Accounting |  | Effect of Adoption
Revenue | $ | 34.1 |  |  | $ | 32.2 |  |  | $ | 1.9 |  |  | $ | 109.2 |  |  | $ | 109.3 |  |  | $ | (0.1 | )
Net loss | (7.8 | ) |  | (9.7 | ) |  | 1.9 |  |  | (58.9 | ) |  | (58.8 | ) |  | (0.1 | )
The effect of adoption for the nine months ended September 30, 2018, includes the opening balance adjustment of $0.1 million. In March 2017, the FASB issued ASU 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 requires changes to the presentation of the components of net periodic benefit cost on the statement of operations by requiring service cost to be presented with other employee compensation costs and other components of net periodic benefit cost to be presented outside of any subtotal of operating income. The Company adopted this standard on January 1, 2018, on a retrospective basis for all periods presented, and certain prior period amounts have been recast to conform with the current presentation as follows (in millions):
| Three Months Ended September 30, 2017 |  | Nine Months Ended September 30, 2017
| As Previously Reported |  | Adjustments |  | Current Presentation |  | As Previously Reported |  | Adjustments |  | Current Presentation
Cost of sales - separative work units and uranium | $ | 32.4 |  |  | $ | 0.3 |  |  | $ | 32.7 |  |  | $ | 76.8 |  |  | $ | 1.1 |  |  | $ | 77.9 |
Nonoperating components of net periodic benefit expense (income) | — |  |  | (0.3 | ) |  | (0.3 | ) |  | — |  |  | (1.1 | ) |  | (1.1 | )
Refer to Note 9, Pension and Postretirement Benefits, for additional information. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 addresses the presentation and classification of certain cash receipts and cash payments in the statement of cash flows. It is intended to reduce diversity in practice by providing guidance on eight specific cash flow issues. ASU 2016-15 became effective for the Company on January 1, 2018. Upon adoption, the Company reclassified $9.0 million of transaction costs incurred in the first quarter of 2017 related to the note exchange (see Note 7, Debt) in the statement of cash flows as follows (in millions):
| Nine Months Ended September 30, 2017
| As Previously Reported |  | Adjustments |  | Current Presentation
Cash used in operating activities | $ | (95.6 | ) |  | $ | 9.0 |  |  | $ | (86.6 | )
Cash used in financing activities | (31.0 | ) |  | (9.0 | ) |  | (40.0 | )
In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. ASU 2016-18 requires that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. ASU 2016-18 is to be applied retrospectively for each period presented. The Company adopted the new standard on January 1, 2018. Upon adoption, the Company added its restricted cash balances to the consolidated statement of cash flows, and the prior period amounts have been recast to conform with the current presentation. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, requiring the recognition of the current and deferred income taxes resulting from an intra-entity transfer of assets other than inventory when the transfer occurs. The Company adopted the new standard on January 1, 2018, on a modified retrospective basis. The adoption of ASU 2016-16 did not have a material impact on our consolidated financial statements, including the cumulative effect adjustment required upon adoption. Accounting Standards Effective in Future Periods In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lessees to recognize a right-of-use asset and lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either financing or operating, with classification affecting expense recognition in the statement of operations. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The new guidance, as amended in July 2018 by ASU 2018-11, Leases (Topic 842): Targeted Improvements, requires a transition adoption election using either 1) a modified retrospective approach with periods prior to the adoption date being recast or 2) a prospective adoption approach with a cumulative-effect adjustment recognized to the opening balance of retained earnings on the adoption date with prior periods not recast. The Company is finalizing its evaluation of lease arrangements. In the Company’s most recent Annual Report on Form 10-K, the Company reported undiscounted operating lease obligations of approximately $13 million as of December 31, 2017. The Company anticipates adopting this standard on January 1, 2019, using the prospective adoption approach. In August 2018, the FASB issued ASU 2018-14, Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20), which modifies the disclosure requirements for employers that sponsor defined benefit pension plans and other postretirement plans. ASU 2018-14 is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The standard is to be applied on a retrospective basis to all periods presented and early adoption is permitted. The Company is evaluating the effect that the provisions of ASU 2018-14 will have on its consolidated financial statements. Significant Accounting Policies The accounting policies of the Company are set forth in Note 1 to the Consolidated Financial Statements contained in the Company’s 2017 Annual Report on Form 10-K. Updates to those policies as a result of the adoption of ASC 606 have been included in Note 2, Revenue Recognition and Contracts with Customers.

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