Theragenics 8-K/A Financial Statements and Exhibits

EXHIBIT 99.3

Unaudited Pro Forma Condensed Consolidated Financial Data

The unaudited pro forma condensed consolidated financial data set forth below are based on the historical consolidated financial statements of Theragenics Corporation and Subsidiaries (“Theragenics”) and the historical consolidated financial statements of NeedleTech Products, Inc. and Affiliate (“NeedleTech”), and adjustments described in the accompanying notes to the unaudited pro forma financial data.  The unaudited pro forma condensed consolidated financial data is presented to give effect to Theragenics’ acquisition of NeedleTech (the “Acquisition”).

The unaudited pro forma condensed consolidated balance sheet combines the historical consolidated balance sheet of Theragenics as of June 29, 2008 and the historical consolidated balance sheet of NeedleTech as of June 30, 2008, giving effect to the Acquisition as if it occurred on June 29, 2008.  The unaudited pro forma condensed consolidated statements of earnings combine the historical consolidated statements of earnings of Theragenics for the year ended December 31, 2007 and the six months ended June 29, 2008 with the historical consolidated financial statements of NeedleTech for the year ended December 31, 2007 and the six months ended June 30, 2008, giving effect to the Acquisition as if it occurred at the beginning of the fiscal year 2007.

The pro forma condensed consolidated statements of earnings reflect only pro forma adjustments expected to have a continuing impact on the combined results beyond 12 months from the consummation of the Acquisition, and do not reflect any changes in operations that may occur.

The unaudited pro forma condensed consolidated financial data are for illustrative purposes only, are hypothetical in nature and do not purport to represent what our results of operations, balance sheet or other financial information would have been if the Acquisition had occurred as of the dates indicated or what such results will be for any future periods. The unaudited pro forma adjustments are based upon available information and certain assumptions that we believe are reasonable, including an allocation of the purchase price based on an estimate of fair value, and exclude certain non-recurring charges as disclosed. These estimates are preliminary and are based on information currently available and could change significantly. The unaudited pro forma condensed consolidated financial data and accompanying notes should be read in conjunction with the historical consolidated financial statements, including the related notes, of Theragenics included in our annual report on Form 10-K for the year ended December 31, 2007 and our quarterly report on Form 10-Q for the quarterly period ended June 29, 2008 and of NeedleTech included in Exhibits 99.1 and 99.2 to this current report on Form 8-K/A.

THERAGENICS CORPORATION AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

(amounts in thousands)

					Pro Forma
	Theragenics		NeedleTech
	June 29, 2008		June 30, 2008		Adjustments				Total
Assets
Current assets
Cash	$	40,382	$	3,087	$	(37	)	(a)	$	21,904
						628		(b)
						(22,156	)	(c)
Marketable securities		11,868		426		(2,000	)	(c)		11,885
						1,591		(j)
Accounts receivable		8,499		1,789						10,288
Inventories		8,631		2,664		703		(d)		11,998
Deferred income tax asset		5,757		225		(309	)	(e)		5,673
Prepaid expenses and other current assets		1,085		215		(54	)	(c)		1,246
Asset held for sale		3,042		-						3,042
Total current assets		79,264		8,406		(21,634	)			66,036
Property and equipment, net		27,427		4,116		(664	)	(a)		31,045
						166		(f)
Goodwill		38,658		-		29,340		(g)		67,998
Other intangible assets, net		10,943		-		11,917		(g)		22,860
Marketable securities, long-term		-		1,591		(1,591	)	(j)		-
Other		501		5		628		(a)		97
						(628	)	(b)
						(409	)	(c)
Total assets	$	156,793	$	14,118	$	17,125			$	188,036

						Pro Forma
	Theragenics			NeedleTech
	June 29, 2008			June 30, 2008		Adjustments				Total
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable	$	1,407		$	378	$				$	1,785
Accrued salaries, wages and payroll taxes		1,766			283						2,049
Income taxes payable		996			438						1,434
Contract termination liability		1,500			-						1,500
Other current liabilities		1,487			341		153		(c)		1,981
Total current liabilities		7,156			1,440		153				8,749
Long term debt		7,500			-		24,500		(c)		32,000
Deferred income taxes		5,519			324		4,826		(e)		10,669
Decommissioning retirement liability		624			-						624
Other long-term liabilities		312			-						312
Total liabilities		21,111			1,764		29,479				52,354
Redeemable common stock owned by  ESOP		-			2,796		(2,796	)	(h)		-
Shareholders’ equity
Common stock		332			91		(91	)	(i)		332
Additional paid in capital		72,695			-						72,695
Retained earnings		62,698			9,348		(9,348	)	(i)		62,698
Accumulated other comprehensive loss		(43	)		46		(46	)	(i)		(43	)
Non-controlling interest of affiliate		-			73		(73	)	(a)		-
Total shareholders’ equity		135,682			9,558		(9,558	)			135,682
Total liabilities and shareholders’ equity	$	156,793		$	14,118	$	17,125			$	188,036

See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

THERAGENICS CORPORATION AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS

(amounts in thousands, except per share data)

	Six Months Ended					Pro Forma
	Theragenics			NeedleTech
	June 29, 2008			June 30, 2008		Adjustments				Total
Product sales	$	30,631		$	8,774	$				$	39,405
Licensing and fee income		518			82						600
Total revenue		31,149			8,856						40,005
Cost of sales		15,242			5,763		24		(a)		21,034
							5		(n)
Gross profit		15,907			3,093		(29	)			18,971
Selling, general and administrative		9,970			860		1		(n)		10,831
Research and development		294			274						568
Amortization of purchased intangibles		937			-		641		(k)		1,578
Change in estimated value of asset held for sale		(142	)		-						(142	)
Loss on sale of assets		3			-						3
Earnings from operations		4,845			1,959		(671	)			6,133
Interest and investment income		756			34		(361	)	(l)		429
Interest expense		(277	)		-		429		(m)		(706	)
Other		(64	)		2						(62	)
Earnings before income taxes		5,260			1,995		(1,461	)			5,794
Income tax expense		1,986			809		(575	)	(p)		2,220
Net earnings before income of non-controlling interest of affiliate		3,274			1,186		(886	)			3,574
Net earnings of non-controlling interest of affiliate		-			2		(2	)	(a)		-
Net earnings	$	3,274		$	1,184	$	(884	)		$	3,574
Earnings per share
Basic		33,134									33,134
Diluted		33,291									33,291
Weighted average shares outstanding
Basic	$	0.10								$	0.11
Diluted	$	0.10								$	0.11

See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

THERAGENICS CORPORATION AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF EARNINGS

(amounts in thousands, except per share data)

	Year Ended December 31, 2007					Pro Forma
	Theragenics			NeedleTech		Adjustments				Total
Product sales	$	61,286		$	16,748	$				$	78,034
Licensing and fee income		924			160						1,084
Total revenue		62,210			16,908						79,118
Cost of sales		31,994			10,234		48		(a)		42,266
							10		(n)
							(20	)	(o)
Gross profit		30,216			6,674		(38	)			36,852
Selling, general and administrative		19,131			1,410		2		(n)		20,543
Research and development		1,365			615						1,980
Amortization of purchased intangibles		1,875			-		1,284		(k)		3,159
Write down of asset held for sale		500			-						500
Loss on sale of assets		-			2						2
Earnings from operations		7,345			4,647		(1,324	)			10,668
Interest and investment income		2,192			229		(722	)	(l)		1,699
Interest expense		(691	)		-		858		(m)		(1,549	)
Other		1			7						8
Earnings before income taxes		8,847			4,883		(2,904	)			10,826
Income tax expense		3,212			1,892		(1,126	)	(p)		3,978
Net earnings before income of non-controlling interest of affiliate		5,635			2,991		(1,778	)			6,848
Net earnings of non-controlling interest of affiliate		-			3		(3	)	(a)		-
Net earnings	$	5,635		$	2,988	$	(1,775	)		$	6,848
Earnings per share
Basic		33,103									33,103
Diluted		33,299									33,299
Weighted average shares outstanding
Basic	$	0.17								$	0.21
Diluted	$	0.17								$	0.21

See Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements

THERAGENICS CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.

On July 28, 2008, Theragenics acquired all of the outstanding common stock of NeedleTech.  The total purchase price, including transaction costs, was $49.3 million, which was paid in cash.  Approximately $5.8 million of cash and marketable securities was acquired, resulting in a net purchase price of $43.5 million.  Theragenics financed a portion of the purchase price with $24.5 million of borrowings under its $40.0 million credit facility.  The purchase price is subject to a working capital adjustment.  Under the purchase method of accounting, the assets and liabilities of NeedleTech will be recorded at their fair values as of the acquisition date and added to those of Theragenics.  The reported financial condition and results of operations of Theragenics subsequent to the acquisition will reflect these values, but will not be restated retroactively to reflect historical financial position or results of operations of Theragenics.

The purchase price is determined as follows (amounts in thousands):

Cash consideration paid	$	47,800
Transaction costs		1,472
Purchase price		49,272

For purposes of this pro forma presentation, the purchase price has been allocated on a preliminary basis to the acquired tangible and intangible assets and liabilities based on their estimated fair values as of June 29, 2008 as follows (amounts in thousands):

Cash and marketable securities	$	5,695
Other current assets		5,371
Property and equipment		3,618
Identifiable intangible assets		11,917
Other		5
Current liabilities		(1,440	)
Deferred income tax liability		(5,234	)
Goodwill		29,340
	$	49,272
Less: cash and marketable securities acquired		(5,695	)
Net purchase price	$	43,577

The amount allocated to identifiable intangible assets and goodwill has been attributed to the following categories based on the preliminary valuation (amounts in thousands):

	Estimated fair value		Estimated Useful life
Trade name	$	3,156	Indefinite
Customer relationships		7,668	7 years
Non-compete agreements		943	5 years
Backlog		150	3 months
Total Identifiable intangible assets	$	11,917
Goodwill	$	29,340	Indefinite

	In accordance with Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets”, intangible assets with indefinite lives, including goodwill and trade name, will not be amortized.  Amortization of all intangible assets identified above is not expected to be deductible for income tax purposes.
	The purchase price allocation above, including the amounts allocated to identifiable intangible assets and goodwill, is presented for pro forma information only.  The actual purchase price allocation will be based on the fair values of the assets acquired and liabilities assumed as of July 28, 2008, which may be materially different than the estimated fair values at June 29, 2008.
2.	Certain non-recurring charges that are not expected to have a continuing impact on the combined results beyond 12 months from the consummation of the Acquisition have been excluded from the pro forma condensed consolidated statements of earnings for the year ended December 31, 2007 included herein.  These include non-cash charges for the estimated fair value adjustment to inventory in the amount of $735,000 and the estimated fair value adjustment for backlog of $150,000.
3.	The following describes the pro forma adjustments related to the Acquisition made in the accompanying unaudited pro forma condensed consolidated balance sheet as of June 29, 2008 and the unaudited pro forma condensed consolidated statements of earnings for the year ended December 31, 2007 and the six months ended June 29, 2008.
	a.	To unconsolidate the affiliate included in NeedleTech’s consolidated financial statements.  NeedleTech’s consolidated financial statements included the accounts of a variable interest entity for which NeedleTech was the primary beneficiary.  Upon the Acquisition, the circumstances under which NeedleTech was considered primary beneficiary no longer existed and, accordingly, the affiliate will not be consolidated with the accounts of Theragenics subsequent to the Acquisition.  This adjustment eliminates the affiliate’s cash balance, property and equipment, depreciation expense, equity of non-controlling interest of affiliate and earnings of non-controlling interest of affiliate, and records a mortgage note receivable, rent expense and interest income.
	b.	To record the repayment in full of a mortgage note receivable due from the NeedleTech affiliate referred to in item 3(a) above.  Such repayment was made at closing of the Acquisition.
	c.	To record the purchase price paid in cash, including direct transaction costs paid prior to closing and borrowings under Theragenics’ credit facility utilized at closing.
	d.	To record the estimated fair value adjustment to the carrying value of NeedleTech’s inventory balance in purchase accounting.
	e.	To record deferred tax liabilities related to acquired assets and liabilities with differing financial reporting and income tax basis.

f.	To record the estimated fair value adjustment to the carrying value of NeedleTech’s equipment in purchase accounting.
g.	To record the estimated fair values of the acquired identifiable intangible assets and goodwill.
h.	To record liquidation and transfer of the NeedleTech ESOP.  All common stock of NeedleTech owned by the ESOP were purchased by Theragenics, and the ESOP was transferred to an unrelated entity.
i.	To eliminate NeedleTech’s historical shareholders’ equity account balances in purchase accounting.
j.	To reclassify NeedleTech’s marketable securities as current.
k.	To record amortization expense related to the acquired identifiable intangible assets arising from the Acquisition.
l.	To reduce interest income for reduction in cash and marketable securities used for the Acquisition based on Theragenics' weighted average investment returns for the six months ended June 29, 2008.
m.	To record interest expense on long term borrowings used for the Acquisition based on Theragenics' borrowing rate at June 29, 2008.
n.	To adjust depreciation expense for adjustments to carrying value of NeedleTech’s equipment in purchase accounting.
o.	To adjust write off of certain leasehold improvements by NeedleTech due to increase in lease term.
p.	To adjust income tax expense for effect of pre-tax purchase accounting adjustments.