Mirion Technologies(MIR) - 2024 Q4 - Annual Report

Company Overview - Mirion operates in two reporting segments: Nuclear & Safety and Medical, with a workforce of 439 scientists, engineers, and technicians, representing approximately 15% of its total workforce as of December 31, 2024[30]. - As of December 31, 2024, the company employed 2,860 full-time and part-time employees, with approximately 1,580 in the United States and 1,519 outside the United States[78]. - Manufacturing personnel comprised approximately 60% of the total workforce, totaling 1,721 employees as of December 31, 2024[72]. - The company has a total of 272 sales and marketing personnel, representing approximately 10% of the total workforce, organized by operating segment and end market[67]. Market Trends and Opportunities - The global nuclear medicine market is expected to grow, driven by the increasing prevalence and incidence of cancer worldwide, alongside advancements in radiotherapy technology[38]. - Mirion's Nuclear & Safety segment benefits from the aging installed base of nuclear reactors, which requires frequent product replacements and upgrades[35]. - The company anticipates increased demand for nuclear energy due to rising energy needs from cloud computing and artificial intelligence data centers[32]. - The company is positioned to capitalize on growth opportunities in the nuclear industry, including decontamination and decommissioning activities[35]. - Mirion's Medical segment enhances cancer care delivery and supports applications across medical diagnostics and practitioner safety, with a presence in over 80% of cancer centers worldwide[29]. Financial Performance - Total revenues for the fiscal year ended December 31, 2024, increased to $860.8 million, up 7.4% from$ 800.9 million in 2023[376]. - Gross profit for the fiscal year ended December 31, 2024, was $399.7 million, representing a gross margin of 46.4% compared to 44.4% in 2023[376]. - Net loss for the fiscal year ended December 31, 2024, decreased to$ 36.6 million from a net loss of $98.7 million in 2023, reflecting a 62.9% improvement[379]. - Operating expenses for the fiscal year ended December 31, 2024, totaled$ 374.9 million, down from $378.3 million in 2023, indicating a reduction of 0.9%[376]. - Cash provided by operating activities increased to$ 99.1 million in 2024, compared to $95.2 million in 2023 and$ 39.4 million in 2022[386]. Research and Development - Research and development expenses for the fiscal year ended December 31, 2024, were $35.0 million, an increase from$ 31.7 million in 2023 and $30.3 million in 2022, reflecting a commitment to innovation[66]. - The company is focusing on developing new products and services, including a personal radiation detector called Accurad for civil services markets[58]. - Approximately 15% of the total workforce is engaged in research and development, consisting of about 169 software engineers and 270 scientists and technicians[66]. Compliance and Regulatory Environment - The company is subject to various environmental regulations, including the Comprehensive Environmental Response, Compensation and Liability Act and the Clean Water Act, which may impact operations[92]. - Compliance with export controls and economic sanctions has become increasingly complex, particularly due to the ongoing conflict between Russia and Ukraine, affecting revenue recognition and project execution[97][110]. - The company is subject to various healthcare-related laws and regulations, including the U.S. Food, Drug, and Cosmetic Act, impacting its medical device operations[101][103]. - The company must comply with medical device reporting regulations and cGMP in the U.S. and ISO 13485 certification internationally to maintain product clearances[151]. - The company operates in a complex regulatory environment, particularly concerning the use of radioactive materials, which could lead to increased costs and liabilities[120]. Risks and Challenges - The company faces significant risks related to supply chain disruptions, which could lead to increased costs and production interruptions[115]. - A substantial portion of the company's revenue is derived from contracts with U.S. governmental customers, making it vulnerable to changes in government budgets and spending[126]. - Cybersecurity risks are growing, with potential significant costs and reputational damage from cyberattacks and data breaches[128]. - The lengthy and uncertain sales cycle complicates revenue predictions, particularly on a quarterly basis, leading to potential fluctuations in operating results[116]. - The company has experienced significant fluctuations in demand for its products, particularly in the nuclear sector, driven by increased electricity demand and geopolitical conditions[110]. International Operations - Approximately 37% of the company's net sales for the years ended December 31, 2024, 2023, and 2022 were generated from international sales[124]. - For the year ended December 31, 2024, approximately 42.1% of revenues were derived from international operations, compared to 40.6% in 2023 and 40.2% in 2022[355]. - The company has operations in multiple countries, including the United States, Canada, and several European and Asian nations[389]. Debt and Financial Position - As of December 31, 2024, the company had$ 694.6 million in outstanding indebtedness under its senior secured term loan facility, with an additional availability of up to $90.0 million under its revolving facility[157]. - The company's effective tax rate may fluctuate due to various factors, including changes in profitability across jurisdictions and evolving tax laws, which could adversely affect its results of operations[161]. - The company may incur additional debt in the future, which could increase risks associated with meeting debt obligations and financial flexibility[158]. Acquisitions and Growth Strategy - The company has acquired and integrated 16 companies since 2016, enhancing its portfolio and market presence[53]. - The company plans to expand its addressable market by entering new geographic regions and pursuing strategic acquisitions[56]. - The company has made and plans to continue making acquisitions and investments, which involve numerous risks and uncertainties[117].