MIR - Earnings call 3 2023 | Mirion Technologies, Inc.

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Operator

Greetings, and welcome to the Mirion Third Quarter 2023 Earnings Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded.It is now my pleasure to introduce your host, Alex Gaddy, Senior Vice President of Strategy. Thank you, Alex, you may begin.

Alex Gaddy

Good afternoon, everyone, and thank you for joining Mirion's third quarter 2023 earnings call. during may will projected differ forward-looking made and forward-looking in comments statements. results actual materially that this include presentation statements, the Reminder from those in results that and quarterly and in Risk with the Form file filings differ cause SEC factors we on report the actual Mirion's that time-to-time The are Form other could reports discussed SEC. Factors from our XX-Q XX-K under annual on caption to with the ended that quarter XX, are also with related prepared to made principles. Quarterly this XXXX.The in accounting references within during third comments today's discussion include the certain were accordance September call will accepted financial generally measures not those financial accompanying the of directly presentation financial be most call appendix the comparable measures today. of Reconciliation the GAAP measures found non-GAAP to can in the materials on website Mirion's All be found IR earnings at can ir.mirion.com.

the the of the Brian will on Chairman to Kingsley, me Officer; Board; Chief our Tom call turn Financial today Larry and Larry? Chief Officer.Now Larry I Kingsley. Executive over Schopfer, are Chairman Joining it Board, Logan, of

Lawrence Kingsley

a Medical closed segments the are environment. by enterprise. a positive key for our an Thank everyone. progress short-term, performance, encouraged Technology capital Board just consecutive The beginning be power source across have quarter. the key confidence on today, quarter momentum in year.Order the I I fifth to company the efficiency. Mirion solid footing in sequentially and quarter in to several Thank team's net This third for of our to pass and about working our continues was down. Quarter CEO, of capital The published of joining on both We approach outlook strong Tom will areas up step call. otherwise expect for as we focus importantly orders a performance.The now backlog the is Logan. driving is our Backlog market initiatives and Overall, begun quite and was in quarter. of leverage we earnings deleveraging team net into saw capital and all of the performance well team grew the afternoon, the Moreover, Alex. direction, has operating macro targets. future us well a profitable QX. solid are the The sets been and The executing third and the for talking and over quarter set Good which heading results should constructive you and numbers working consistent have growth.I what strength for demonstrate portfolio on all positions fundamentals coverage across the you, looks well, Tom? call in pivot And focus cash the right flow fourth that side are mixed on nuclear a is building we business. outstanding. in robust. and the am tick stronger the

Thomas Logan

efforts were my to of headlined new backlog by for new and was afternoon, during The year.Despite the set our position and backlog QX. today growth revenue an the end colleagues increase of period to achieved XX% with flow expanded deliver size large quarterly thanking was build Strong QX backlog nuclear the of the we by of $XXX Larry, XX%, consecutive Mirion year-over-year in the and parts record everyone. orders fifth outstanding, from of their I spare approximately compared million, order an a customers. performance, and quarter, orders as scope of you, quarter growth good order delivering us nuclear strong Technologies seeing XX% my begin positive last the for The to we've results. line like in Thank encouraging a helping organic last third we and would of comments excellent financial is committed we've capital guidance executing more year. globally.Second, company step with of period to was revenue delivered north compared in our great total we this than an me, cash free priority into flow for initiatives, plan. the fourth XX%.Third, working things which right same third team progressing been sentiment million going of optimization remains our expectations, a according top to momentum off the led building $XX.X organic to of quarter, XXXX. reiterated the direction. reflection for with against our are the the way did and of job adjusted quarter.Fourth, and growth of flow growth are and Cash our organic same

healthy orders in our market, small later fourth provides results, order medical in of with in a new end financial Our seeing platform quarterly than to the in in parts nuclear on targets in business our quarter, reactor the our project call.Before the engagement medicine detail customers. Asia day to different spare our seeing talk We're in markets. and to momentum this some from see the a ecX nuclear modular adding I'll this space. cover October. we booked first $XX Starting million we to us We continue several build our quarter, to of are In power, giving I'd from five closed performance financial we we week, the more and large more demand year line orders and booked I power acquisition through emerging software Korea. get developers, including on service position customers. achieving another in good the our expand of orders into for on sight the into what strategic this and year.Finally, confidence nuclear about backlog like

orders with materialize The We expect planning is like new install supporting the decommissioning generation. the QX growth. an global space, fundamentals development pipeline active scale build we push horizon we energy well.Additionally, received remain role to utility for modular and as customer small cleaner excited several the to base encouraging the reactor steady the in one is improving supporting future in over play

prioritize remain strength the market. we the encouraged continue orders and an within the seeing internationally building the across across We to developer segment, at European therapy increasing seeing portfolio, the radiation medical by in are relationships landscape come especially pace.In we're

the is our in to region. support paying as should sales position meet share better hardware enhancements, clinical teams in have we RT demand RTQA well cycle to continue in center future. platform, investment the a Our order us the software European to win in off continue SunCHECK Domestically, we reported which and augment our lengthening

in and whole.Let's X quarter Slide are class detail. solutions a we Our remain flip best to more over by now to our space third results as in the encouraged discuss

sustained strong we In end As way growth. organic I'd Technologies achieved pass strength positions was growth momentum in X% future organic consolidated few growth to a us sales we international our at and revenue And quarter importantly, XX% XX.X% we for of additional was revenue medical, year. a Medical deliver make RTQA positive the led our while delivered our well key backlog, growth third which mentioned comping delivered baton, Growth earlier, quarter. this QX. like the strong comments in despite end geographies. growth I growth to by and markets last by I organic market.Before XX%. increasing supported in led the growth,

top margin as establish and a flow the business list expansion our aim cash priority my reputation the continue delever remain at compounder. as and to First, of to we

role. third have president confident and I quarter, group our well inventory in teams I our as the in and Our executed the the for networking interim remain business and strategy long-term until reins serve the enhance its capital will the of in performance to future.Second, retaken find right we medical fit

very reminder, spent the much over medical utmost I the executing the a year. continue I've segment on our to confidence optimizing operating with closely been the and the course organizational the team performing The well is strategy.Third, segment, the in Mirion our have structure know growth of you technologies on XXXX I As as model leading of and defining team brand. working

$XX Medical additional acquisition, software see acquired value that, to $XX Chief intelligence.Finally, Eloy excellence. for announced important As squared Webb Officer, this our confidence ecX Chief Brian? the of and to Marketing revenue Mirion and customers, acquisition [indiscernible], these byproduct of with streamline to Chief strategic line over generate that to acquired proforma our will Chief family. executing year announced value changes and profile our of position Shelia I'm we a transformation our EBITDA impacting and have to To particularly creation, of nuclear the each support of new and daily the group margin enhance offers few medical provide work, now our nuclear week and the designed the can application de-leverage, portfolio accelerated the welcome in to corporate growth our turn simplify and adjusted as Schesny referring accretive for the diagnostic things able group areas I'm and acquisition, of excited million operate new helping strong leverage color Dr. that commercial teammates to and and annual Digital the changes James and be them the Through operational business level a a to new of business our margins. focus reorganization you be give I to a will has Inaugural the Mirion.With the higher of and long-term of the Loic ecX software changes to to create also group, excited We've that that bring expect solutions. internally calendar million Erin naming These augment processes.We business of we'll to the to the to on President, to $X.X Schopfer. negatively Brian accountability of to that this some design, ecX medical expect highly organization from and the within software a near its and value workflow commitment attainment concert to therapeutic our comprehensive objectives.In organization. his of the operations without I our million weâ€™ve on digital a XXXX, team Officer. Officer; accelerate business medicine is promotion for artificial colleagues cashflow for Financial and that I'll of company appointment Technology include position Cocks implementation, and Officer; Mirion revenue medicine to we're

Brian Schopfer

get Total please a everyone. and XX.X% to take growth by million, ask up quarter, company organic at afternoon, Quarterly our revenue to XXX.X good was XX.X%. while was third you quarter To revenue and was deeper Tom, turn to look started, in slide EBITDA the Thanks, six grew adjusted I'll XX%. results.

approximately by gross things.First, two segment a primarily by basis the saw larger last Gross year. impacted point impacted contribution overall company margin negatively adjusted basis margins the were at period XXX performance, revenue contraction XXX technology same from we Looking from points. margins

and non-repeat expanding EBITDA million mix more margin. with technologies Second drove discussion. adjusted EBITDA XX.X point margin more get XXX impact XXX later in basis gross the detail to I'll than Adjusted items in XX.X%. to into points basis segment was

quarter, in comped X. Medical performance as was line Top expected, the continues starting our price last year-over-year to cost but expanded on us QX As the we was to contributing Medical X.X% a reported in in flat At continue be segments. Pricing rate the negative performance margins company as segment both of very growth revenue team.Moving a expectations approximately year. basis. with Slide on focus on X%. strong was dynamics positive level, and with basis, organic be a a for to price with dollar total line on now

grew expansion For to QX year. last Medical reference, EBITDA by from X% business, adjusted the offset XX% in point growth by the was same performance improving the Medical physical the stack this was our XX.X%, first of in supported EBITDA period the margin rehab mix by compared of an Organic half in which quarter. a in was Biodex product divestiture margin reported year, nearly XXX-basis two-year segment. of organic impact out actioned was the of and than Technologies QX initiatives divestiture, Slide in more in cost accounted Technology a which revenue XX.X% by the to we X% the growth comp half the quarter, segment. X by from a in revenue margin lower was for Biodex in year over expansion.Flipping organic of XX.X%. Growth prior The and quarter recognition, timing price. mix business period. with of driven the

our seasonally expect is the quarter a Technologies, will quarter, be QX fourth for single-digit which comping growth organic we significant number third our reminder, In from XXXX. a quarter. smallest low As

we that growth a strong basis performance on XXXX, we XX for a the EBITDA top-line First, adjusted leverage a growth negative the expect. full high year higher, points would XX.X%. of was of which following: the pricing single-digit to of on result. not we segment.Technologies were margins rate the million, For generate cost to quarter, We positive representing include Technologies EBITDA able Adjusted the expect off dollar basis, some but price offset were Key XX.X%. $XX.X Cost to operating drivers level but was inflation strong basis. expanded

comped the quarter.Note 'XX SIS any the QX we last of impacted during inorganic that, basis was with month acquisition. adjusted SIS Additionally, the acquisition points margin quarter by EBITDA with one This impact. XX QX

structural year-to-date product Slide million free over X flow figure a saw items mix margin in impacted nature.Turning North approximately with segment in cash non-repeat line. bringing Defense $XX.X to quarter flow were points. that the These for XXX America we Technologies coupled was These largely to Civil Lastly, by and isolated our businesses French and $XX.X our to million. few not leverage. now one-time items basis the impacts are quarter, our during cash Adjusted

took As expected, performance flow step forward. cash a

a work cash, to million, Net was a see lot to do began and capital for still on the we the $X.X However, a benefit reduce quarter. deliver source of in we quarter. of fourth to expectations working have of our providing inventory

working at the in our improving continue cash source to conversion.Moving of down September of target X.Xx capital We a leverage cash net end full as ticked quarter. the to for year, on, net

our As looking target acquiring our X.X This Tom confident the XXXX. ability we and XX, we've delevering Slide leverage guidance mentioned, for from ecX.Finally, includes end. operational in impact reiterated we execution, financial year business reiterated have the through our for at strong are continue

million now to organic call reported out. growth. XX%. free margin is EBITDA solid and flow Tom I'm to our confident expected EBITDA million between and things Overall, with the to is between full quarter, Adjusted year between revenue quarter.I'll third pass with million expected and adjusted a XXX fourth Adjusted XX% XX and We million X% XXX of expect X% to X% XX full with XX% heading for into the momentum growth year. close back the cash

Thomas Logan

Brian. you, Thank

a begin we a, like leave and to are q you I'd afternoon. there with this Before few things

First, our by very into remains the strong, the of coming quarter out across fourth confident positive and large backlog Engagement we're momentum quarter. was position and orders. order overall third the nuclear power business heading bolstered

line quarterly segments growth and of our board. robust both with evidence results delivered Second, line was reporting EBITDA in across expansion the Top margin expectations.

positioned done including fourth we've rest it QX. for me reiterated our this guidance, There's the Third, Alex? believe Q&A. dynamics up to times X.X up. still remains we on saw things to improvement finally, key notable And for within year into work Alex to flow leverage be target our over I deliver team. a our heading for cash now pass the priority in the XXXX business quarter.I'll to is the well of and open expectations and

Alex Gaddy

Tom. the go Thanks, for concludes this our let's That afternoon. start formal Operator, and Q&A ahead comments session.

Operator

first Our Goldman Instructions] Joe from with [Operator question Ritchie is Sachs.

Joseph Ritchie

that How that's nuclear a Can new saw on is we much by about the I little million. bit and increased of probably $XX builds? And the to think then cycle start specifically guess that build? way orders nuclear was for the probably the a of you. longer that I business on orders So new

would of see when that come the you to through kind P&L? So expect

Brian Schopfer

parts nuclear you Yeah, million about is the we growth, we the orders new saw Korea. XX quarter One so, each million, up size spare year look, project. same the the order XX so a of in if about approximately over one saw is think year, two order bill out

actually kind rateably years, If start the And revenue of we'll over the see nuclear build, to two three in this then see, we'll fourth new quarter. we'll or you to Joe. trade next we know see it about think particular we believe some

us this one is in business this the impacts always case is which us So is it's pretty but RevX good near for a standpoint. not order from term, for this year -- next

Joseph Ritchie

technology. it guess no expectations longer for was there I little quarter was cycle was maybe the to just reason thought in I fourth because bit the change a the

had to, you original guys to already go something then a made through, and kind this us ahead when that want you gave I want you guess, of Tom, you as that, -- Brian? I think was answer So you you guide, contemplated the think

Brian Schopfer

I'll go Go ahead. ahead, No, and answer.

Joseph Ritchie

made then and other side new Tom, new projects And mention nuclear you your a of build potential pipeline. No. the on

Just be helpful. color any would more that around

Thomas Logan

in that, let's I'll it I'll then the maybe and part answer Brian order. first take of reverse the Yes, answer can question.

art NSSS as planning that expect And continued that's will tell in it. our So growth pipeline yes, away nuclear if difficult nuclear will continued at as of look I've that something good look players, notoriously nuclear the the see as and we'll timing, you term the at seen from. our see that new work Recognizing so that including in the that to of designers. expectation for specific being predict build But our terms will major sector. a pipeline XXXX we The us. view projects. we we we quarterly note in is for we theme horizon, are most reactor will that with that for that NSSS that shy is be I of projects this I is you

Brian Schopfer

to million then the move predict is it's I working on bucks. mean, less on And hard quarter. said, like quickly, than this have on Tom I Joe, we pretty the to the for guidance quarter for fourth these couple mean, really look, are land. Loic been the And while. The when a small. and team they're up impact going didn't fourth a

Joseph Ritchie

one, it quick and other on. One pass I'll

in quarter. the to range on flow. cash Still improvement Congrats this hit free the for the improvement on year. Just need XQ more

So within your XX control. in XX to to about confidence that getting just your talk what's and

Brian Schopfer

we a mean, target. The leverage a we impact but matter of reason the our payments team issues our there's range -- for that and will that the reiterated near-term there's of and very there's mean, few kind I this. on definitely the Yes, is kind quarter. projects aggressively attacking I I structural both couple, look, fourth a things mean, some

So and there's lot guidance about I we morning. a we the think is this out put our control of in very feel this good

Operator

Group. Our with Citi next Andy [Operator Instructions] is question Kaplowitz from

Andrew Kaplowitz

So Brian, Tom up and just Joe's following on maybe question.

X% the In at segments too I to want of the know talked in terms Mirion's two â€˜XX of us you but much setup, to don't the and bookings, sort and look I say the to on plus thinking here like, ability visibility when would give you call in about past like and the the sit normal, as we it grow, it you sort the Is of digits mid-single X% range. higher how normal, puts in â€˜XX about than November, takes?

Thomas Logan

let an would tee where I coverage about me this at has dynamic in we general, coverage. much been in year, improvement record we've end Yes, the seen the Joe, case a look you I'll we at it and sitting here are and this -- that talk QX. say let general, sequentially, backlog our guidance that to relative encouraged it an we up, of seeing then and heartened by that for improving in if that are And more. little coverage are Brian what certainly the on of is backlog

Andrew Kaplowitz

conservative? in think QX? XX% It's growth QX, we And in Was question, pull any about in of you Technologies, helpful, you low do there we are a Brian, forward growth the model, in single-digit Like, there But, again tough comp. maybe strong context of sort of follow-up like like, such on how being or, a growth in sort QX. didn't Tom. mentioned

Brian Schopfer

kind June. feel good between and movement in what QX what we pretty we in from said. of some thought about I kind QX think definitely of we Again, is There

was segment the what, a year last comping in from side, are the that like, XX% sorry, number last We XX% XX%, year. on Technologies organic

number. big a that's So

see EBITDA fourth range we're very think some comfortable with in revenue well. will the margin quarter and expansion as we the I

Andrew Kaplowitz

I more let parts. we in my maybe obviously, What like you getting made -- but last cost versus good Like, detail as down. means question the about you little still positive that, and take then And assume Technologies, And demand It price there. in a not leave costs. give Brian, commodities rate pretty Like, to would are two cost basis. get see, gone does one-time. is talked like of the maybe shouldn't we a on there? generally more one-time me us supply a it side, Because you margin have sort repeat, is chain on better,

to So do what there? you can get

Thomas Logan

think saw civil we business. So and mean, is on business, the I the some one this And burning cost our But, reasons. French to the question, products -- the inventory, I catch-up of we which through kind quarter. is second the some just out goes kind projects costs mainly timers, flow. focused generate One also some I of is on exactly look, in two of reduction it are higher we which mean, we're saw of cash what And that good. on is more one inventory to for of you said. two,

material the better, the us chain allows does P&L. through costs supply get to pull to As that better through,

I side. So on from cost think us price there it is that the gets basis, rate a a that,

Operator

Our next Securities. question Chris CJS is from with Moore

Christopher Moore

into maybe 'XX are not But and getting puts know just 'XX you margins will this point at gross in that just time. above takes So the 'XX. fiscal be much I too maybe and

Thomas Logan

I prepared top I year. said company. flow remarks what of was, for think we mean, both and think, Tom priorities are also in but and now our both right going cash for to the give not our are But margin entire next as mean, I us, I about, guidance expansion we

are looking we -- on at We focused this. are very

there is pricing out dynamics good what probably talked to think continue being is focus. Look, I I that to that about think be say. a I there.

I team work And chain focused on the stuff, very we inventory as the through that helpful. is think supply is the side.

with year and of out the Our pretty of through competition kind we structural inflation there. a that's -- pay big increase kind all this structural put

ecX year us what the kind saw year. that versus of us. will more very it when software And this software you all next I think via about a bit business I the for by put ion we're we year little next what of way, think and do the holistically in, feel for different across good business I we think But adding to mix. kind

about takes So mean, expect we I it's puts giving think most you expansion. But feel specific And we can a without the again, give I a that pretty we good probably and here. that's the target I you have. focus.

Christopher Moore

build five XXX there. consecutive quarters. Obviously almost medical you much Backlog a technologies, Is about it between order and year nuclear is balance million the talked up new different the was ago? than that

Thomas Logan

little our the a the technology grown is just Well, medical on mean, of is side. less No. bit because back. backlog I backlog's most the and growth than XX% of the

than you think backlog, the If medical. about less it is XX% of

Christopher Moore

you the one for me, penetration and maybe not just been that gonna I on have That guys you're expect dose, mean, kind a said, do ramp And â€˜XX significantly it different than -- dramatically. to the just clear last of transition? at is I Or end is really SID this flip switch end quickly be â€˜XX? you see of three-to-five-year of a mean, penetration

Brian Schopfer

is Chris, transition. three-to-five-year really there a

current again, accelerated in the that we But half at of that a think on that terms of impacting mix and this year. next kind of systematically, the We in fulfill campaign it might the be important. longer just first I orders occur not will rate meaningfully but will expect is this

Operator

I no over at are the this to would Logan to questions like Tom hand further closing for floor time. comments. There back

Thomas Logan

as at and the noted well been year.Further, toughest good, top strength and coming and and this in we're happy that participation happy believe key we're relative see if our encouraged quarter. through more that and manage the factors company top your solid so business favorable be call, to have point throughout control. the think Again, gentlemen, underpin and line coming line to strongly the we've of dynamics ladies we're the the report market level you very is is clear, we is your that. we These as within a by Well, that of rest always today. any the the your And I of to far cyclicality it engagement through that customer of what Mirion very appreciate to is the a know, this of part

the feel speaking and So you QX. say momentum operational all to again how with of that into three on. the commercial very sitting we're to that that look We business forward the priorities we coming is in pleased about And much feel we to good organizationally, months we're time. focused of

and thanks it again the we'll there leave for So day.

Operator

conference. This today's concludes

your disconnect and your this may lines you participation. You at for time, thank

Mirion (MIR) 2 Nov 232023 Q3 Earnings call transcript