March 10, 2011 / 1:22 PM / 7 years ago

UPDATE 2-Nordion posts profit, braces for reactor shutdown

* EPS from cont ops $0.35 vs loss $0.36/shr yr-ago

* Revenue from continuing operations up 54 percent

* Chalk River to shut down for maintenance in May

* Sees slightly lower revenue in Q2 (Adds details from conference call, background, shares; in U.S. dollars unless noted)

TORONTO, March 10 (Reuters) - Nordion Inc NDN.TO NDZ.N, one of the world’s largest suppliers of medical isotopes, rebounded to a quarterly profit late Wednesday, helped by cost savings and the resumption of operations at Atomic Energy of Canada’s Chalk River nuclear reactor.

The Canadian company had posted losses for five consecutive quarters after the Chalk River reactor was shut down for more than a year for repairs, cutting off its main supply of radioactive isotopes, used in cancer testing and other medical procedures.

Now, Nordion expects to take another hit from a shutdown at Chalk River for maintenance and inspection.

It also says a 10-year supply deal it signed with a unit of the Russian nuclear agency, Rosatom State Corp, will not cover all the expected shortfall.

“While Nordion may in a position to provide limited quantities of supply to help alleviate the planned shutdown, our current expectation is that we will not have commercial quantities of moly-99 from Rosatom as backup supply during the outage,” Chief Executive Steve West said on a conference call with analysts on Thursday.

Molybdenum-99, the most prominent isotope used in nuclear medicine, is the parent isotope for technetium-99m, used in most nuclear medicine procedures. Chalk River’s 53-year-old NRU facility is one of the few reactors in the world that produces commercial quantities of moly-99.

Since the previous shutdown, Nordion’s customers have tried to cut their exposure to the company.

“Our customers are searching for options that offer them diversified supply,” Chief Financial Officer Peter Dans said on the call.

“These factors, in addition to the one-month NRU shutdown, have dampened demand.”

In the second quarter, the company expects revenue and segment earnings to decline slightly.

For the first quarter ended Jan. 31, income from continuing operations was $23.4 million, or 35 cents a share, compared with a year-earlier loss from continuing operations of $43.3 million, or 36 cents a share, the company said late on Wednesday.

Revenue from continuing operations rose 54 percent to $70 million.

Nordion shares edged up 0.4 percent to C$11.61 on Thursday morning on the Toronto Stock Exchange. The stock has risen by more than a third in the past 52 weeks. In New York, the shares were up 0.4 percent at $11.90.

The Canadian government has been trying to sell Atomic Energy of Canada Ltd, the federal nuclear technology agency that operates Chalk River, but has not yet found a buyer.

$1=$0.97 Canadian Reporting by S. John Tilak; editing by Rob Wilson

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below