Nordion Reports First Quarter 2012 Financial Results

^{Published on 2012-03-06 14:01:10 - Market Wire}
 

Nordion Reports First Quarter 2012 Financial Results

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• First quarter fiscal 2012 revenue of $53.0 million and adjusted earnings per share from continuing operations were $0.11 (GAAP loss per share from continuing operations were $0.01)
• Achieved TheraSphere revenue growth of 23% in first quarter fiscal 2012 compared to same period last year
• Advanced Sterilization Technologies strategic objectives with key account renewals and commercial launch of GammaFIT™

Nordion reports in U.S. dollars unless otherwise specified. Please also refer to the Management's Discussion and Analysis and Consolidated Financial Statements.

OTTAWA, March 6, 2012 /PRNewswire/ - Nordion Inc. (TSX: NDN) (NYSE: [ NDZ ]), a leading provider of products and services to the global health science market, today reported results for the first quarter of fiscal 2012. First-quarter revenue of $53.0 million decreased 18% from $65.0 million reported in the first quarter of fiscal 2011.

Excluding the specified items shown on the attached quarterly non-GAAP reconciliations table, adjusted net income for the first quarter of fiscal 2012 was $7.1 million, compared with $14.0 million in the previous year. The Company reported GAAP net loss of $0.9 million in first quarter fiscal 2012 compared with net income of $21.5 million in the first quarter of fiscal 2011.

First-quarter fiscal 2012 adjusted earnings per share, excluding specified items, was $0.11 compared with $0.21 in the first quarter fiscal 2011, reflecting a decrease of 48%. GAAP loss per share from continuing operations were $0.01 in the first quarter of fiscal 2012, versus $0.38 earnings per share in the same period last year.

"Given the dynamic nature of our businesses, our performance in the first quarter was lower than expected, however the fundamentals of our core business remain strong," said Mr. Steve West, Chief Executive Officer, Nordion Inc. "We continue to focus on our strategy of building an interventional oncology business, selectively growing our attractive Sterilization Technologies franchise and optimizing the value of Medical Isotopes."

Key Q1 2012 Events:

• On December 6, 2011, Nordion commercially launched the Flexible Irradiation Technology (GammaFIT™) irradiator system;
• On January 19, 2012, Nordion announced it had entered into a six-year cobalt-60 supply agreement with Synergy Health; and
• On January 31, 2012, Nordion announced the renewal of its normal course issuer bid.

Consolidated Financial Results

Segment Financial Results (with reconciliation to net (loss) income)

Targeted Therapies
Targeted Therapies revenue for first quarter fiscal 2012 of $12.8 million decreased by $4.0 million or 24% compared with first quarter fiscal 2011. TheraSphere revenue of $11.0 million increased by $2.0 million or 23% in first quarter fiscal 2012 compared with first quarter fiscal 2011, while Contract Manufacturing revenue of $1.8 million decreased by $6.0 million or 77% compared with the same period in the prior year.

TheraSphere sales growth during the first quarter of fiscal 2012 was primarily due to adoption by new customers. TheraSphere revenue growth was essentially flat on a sequential basis primarily due to a decline in revenue with certain key accounts, which was offset with growth in new accounts. While the Company believes these fluctuations are a normal part of the growth of a high-value, niche product, Nordion continues to reduce the impact of this variable through greater training and education for interventional oncology teams, securing new customer accounts, and increasing support to existing customer accounts.

Contract Manufacturing revenue was primarily impacted by the interruption of CardioGen-82® manufacturing for Bracco Diagnostics Inc. (Bracco). Nordion has not manufactured CardioGen-82 since second quarter fiscal 2011 due to a third party component issue, which arose during that quarter, and a voluntary recall for other reasons that was subsequently initiated by Bracco effective July 25, 2011. Bracco recently announced the reintroduction of CardioGen-82 into the market. On February 14, 2012, Bracco issued a letter to customers that they were resuming CardioGen-82 production with availability phased in through February and March.  While Nordion's role in the return to manufacturing has yet to be defined, the Company's discussions with Bracco are ongoing in this regard.

Sterilization Technologies
Sterilization Technologies revenue for first quarter fiscal 2012 of $16.1 million decreased by $2.6 million or 14% compared with the first quarter fiscal 2011. Revenue from Cobalt of $15.7 million in first quarter fiscal 2012 decreased by $2.7 million or 15%, while revenue from Sterilization-Other of $0.4 million remained flat compared with first quarter fiscal 2011. The decrease in Cobalt revenue was primarily due to the quarterly variability of timing of shipments during a fiscal year.

Medical Isotopes
Medical Isotopes revenue of $24.0 million in first quarter fiscal 2012 decreased by $5.4 million or 18% compared with first quarter fiscal 2011. Reactor isotopes revenue of $20.9 million in first quarter fiscal 2012, decreased by $4.7 million or 18%, while Cyclotron isotopes revenue of $3.1 million decreased by $0.7 million or 18%, compared with the same period of the prior year.

The decrease in Reactor isotopes revenue in first quarter fiscal 2012 was mainly due to decreases in sales volume and price of Molybdenum-99, while Cyclotron isotopes revenue declined due to lower sales volumes of Thallium-201 and Iodine-123.

Corporate and Other
Corporate and Other spending was $1.9 million in first quarter fiscal 2012, up $0.7 million, compared with the first quarter fiscal 2011. Corporate selling, general and administrative (SG&A) expenses of $3.2 million in first quarter fiscal 2012 increased by $2.1 million compared with first quarter fiscal 2011 primarily due to stock based compensation costs and a $1.0 million increase in insurance expense, partially offset by the impact of the weakening of the Canadian dollar relative to the U.S. dollar. Other income, net was $1.3 million, up $1.4 million compared with an expense of $0.1 million in first quarter fiscal 2011, relating to foreign exchange gains.

A full copy of Nordion's first quarter fiscal 2012 financial statements and notes and the related Management's Discussion and Analysis can be downloaded at [ www.nordion.com/investors/financial_results.asp ] or found on [ www.sedar.com ] or [ www.edgar.com ].

Conference Call
Nordion will hold a conference call on Wednesday, March 7, 2012 at 9:30 am ET to discuss its first quarter fiscal 2012 results. This call will be webcast live at [ www.nordion.com ], and will be available after the call in archived format at [ http://www.nordion.com/webcasts ]. To participate, please dial 1-866-225-0198 (toll-free North America) or 1-416-340-8061 (International).

About Nordion Inc. 
Nordion Inc. (TSX: NDN) (NYSE: [ NDZ ]) is a global health science company that provides market-leading products used for the prevention, diagnosis and treatment of disease. We are a leading provider of medical isotopes, targeted therapies and sterilization technologies that benefit the lives of millions of people in more than 60 countries around the world. Our products are used daily by pharmaceutical and biotechnology companies, medical-device manufacturers, hospitals, clinics and research laboratories. Nordion has more than 500 highly skilled employees in three locations. Find out more at [ www.nordion.com ] and follow us at [ http://twitter.com/NordionInc ].

Caution Concerning Forward-Looking Statements

This releasecontains forward-looking statements, within the meaning of applicable securities laws, including under applicable Canadian securities laws and the "safe harbour" provisions of the United States Private Securities Litigation Reform Act of 1995.  These statements can be identified by expressions of belief, expectation or intention, as well as those statements that are not historical fact.  The words "may", "will", "could", "should", "would", "outlook", "believe", "plan", "anticipate", "estimate", "project", "expect", "intend", "indicate", "forecast", "objective", "optimistic", and similar words and expressions are also intended to identify forward-looking statements. Forward-looking statements are necessarily based on estimates and assumptions made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors that we believe are appropriate in the circumstances, but which are inherently subject to significant business, political, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Accordingly, this release is subject to the disclaimer and qualified by the assumptions, qualifications and risk factors referred to in our 2011 Annual Information Form (AIF). Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to, fluctuations in supply and demand, pricing pressures and rising costs, changes in currency and exchange rates and potential adverse developments in new and pending legal proceedings or regulatory investigations,as well asthe risk factors which are described in section 5 of our 2011 AIF and in our other filings with the Canadian provincial securities commissions and the US Securities and Exchange Commission, and our success in anticipating and managing those risks. We caution readers not to place undue reliance on the Company's forward-looking statements, as a number of factors could cause our actual results, performance or achievements to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates and intentions expressed in such forward-looking statements. The Company does not assume any obligation to update or revise any forward-looking statements, whether written or oral, that may be made from time to time by us or on our behalf, except as required by applicable law.

Non GAAP Information

To supplement the financial measures prepared in accordance with generally accepted accounting principles (GAAP), the company uses non-GAAP financial measures such as adjusted net income and adjusted earnings per share. Non-GAAP financial measures exclude certain items, such as restructuring charges and recovery, change in fair value of embedded derivatives, AECL arbitration and legal fees, loss and gains on sales of investments, loss or gains on discontinued operations, and tax effects on adjusted items. Management uses non-GAAP financial measures internally for strategic decision making, forecasting future results and evaluating current performance. By disclosing non-GAAP financial measures, management intends to provide investors with a meaningful, consistent comparison of the company's core operating results and trends for the periods presented. Non-GAAP financial measures are not prepared in accordance with GAAP. Therefore, the information is not necessarily comparable to other companies and should be considered as a supplement to, not a substitute for, or superior to, the corresponding measures calculated in accordance with GAAP.

Please refer to the complete set of Consolidated Financial Statements for Q1 2012

Please refer to the complete set of Consolidated Financial Statements for Q1 2012

Please refer to the complete set of Consolidated Financial Statements for Q1 2012

SOURCE Nordion Inc.