Mirion Technologies, Inc. (MIR) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call highlighted strong financial metrics, optimistic guidance, and strategic acquisitions, particularly in the nuclear sector. The company's focus on AI and digital strategies, along with a positive outlook for 2025 and beyond, supports a positive sentiment. While some uncertainties remain, such as specific win rates and AI KPIs, the overall narrative is growth-oriented, with significant opportunities in nuclear power and medicine. Given the mid-cap status, the market is likely to react positively, but not excessively, resulting in a positive prediction of 2% to 8% stock price increase.
Key Financial Performance
Orders in 2025 Record orders totaling more than $1 billion, representing a 26% increase versus 2024. This growth was driven by the nuclear power market strength and $150 million from the large opportunity pipeline.
Nuclear Power Organic Revenue Grew more than 11% in 2025. Growth attributed to favorable macro conditions and strategic acquisitions increasing exposure to the nuclear power market.
Nuclear Medicine Organic Revenue Grew more than 13% in 2025. Growth supported by favorable macro conditions in nuclear medicine.
Backlog Increased by 36% compared to 2024, driven by 2025 order growth and the addition of Paragon's backlog.
Medical Segment Orders Declined by 6% in 2025 due to tough comparisons from 2024 and transitory macro headwinds.
Adjusted EBITDA $227.9 million for 2025, up 12% compared to 2024. Margins expanded by 90 basis points due to procurement initiatives and operating leverage.
Adjusted Free Cash Flow $131 million in 2025, doubling 2024's performance. Growth attributed to improved earnings, reduced net interest expense, and lower CapEx.
Adjusted EPS $0.46 in 2025, a 12% increase compared to 2024. Slightly below guidance due to tax dynamics.
Nuclear and Safety Segment Revenue $614.6 million in 2025, up 9.5% compared to 2024. Growth driven by 11% nuclear power growth, partially offset by an 8.5% decline in labs and research.
Medical Segment Revenue $310.8 million in 2025, up 3.7% compared to 2024. Growth driven by double-digit organic revenue growth in nuclear medicine, offset by lower RTQA organic revenue.
Q4 Enterprise Revenue $277.4 million, up 9% compared to Q4 2024. Growth driven by M&A and FX tailwinds, with organic growth of 0.5%.
Q4 Adjusted EBITDA $77.6 million, up 11.5% compared to Q4 2024. Margins expanded by 60 basis points despite margin dilutive impacts from Paragon.
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Operating Highlights
Nuclear Medicine Organic Revenue Growth: Grew more than 13% in 2025 and is expected to enable double-digit organic growth in 2026.
Acquisition of Certrec and Paragon Energy Solutions: Acquired Certrec in July and Paragon Energy Solutions in December 2025 to augment North American nuclear power exposure.
RTQA Product Launches: New product launches expected in 2026 to support growth in the RTQA segment.
Nuclear Power Market: Organic revenue grew more than 11% in 2025, driven by favorable macro conditions and a strong large opportunity pipeline.
SMR Market Expansion: Contractual commitments with over 20 SMR developers, with $39 million of SMR-related orders in 2025.
Defense and Diversified End Markets: Orders increased by $34 million, primarily from the U.S. and NATO.
Procurement Process Improvements: Contributed to nearly 100 basis points of adjusted EBITDA margin improvement in 2025.
Adjusted Free Cash Flow: Doubled in 2025 to $131 million, representing a 57% conversion of adjusted EBITDA.
Cost and Productivity Initiatives: Medical segment margins expanded by 260 basis points in 2025 due to procurement savings and operational initiatives.
Increased Nuclear Power Exposure: Strategic priority to increase nuclear power exposure, now accounting for 40% of total revenue.
AI and Strategic Initiatives: Increased investment in AI and other strategic initiatives to drive future growth.
Global Expansion of Acquired Capabilities: Leveraging Certrec and Paragon acquisitions to expand capabilities globally and strengthen SMR market position.
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Risk or Challenges
Government Shutdown Impact: The 43-day U.S. government shutdown negatively impacted the Labs and Research end market, particularly affecting DOE orders in Q4 2025. This caused delays in demand and revenue generation.
RTQA Market Weakness: The RTQA market faced sluggish demand due to hardware headwinds in North America, China, and Japan, as well as negative capital spending dynamics in the U.S. healthcare market.
Medical Segment Challenges: The Medical segment experienced headwinds due to tough comparisons from 2024, transitory macroeconomic factors, and sluggish demand in the RTQA market.
Paragon Acquisition Margin Impact: The acquisition of Paragon in December 2025 was margin dilutive, impacting adjusted EBITDA margins in Q4 2025 and expected to continue affecting margins in early 2026.
Supply Chain and Procurement Risks: While procurement initiatives improved margins in 2025, ongoing supply chain optimization remains a critical focus area, particularly for integrating Paragon and Certrec.
Currency Exchange Rate Volatility: Revenue was positively impacted by FX tailwinds in 2025, but future volatility in currency exchange rates could pose risks to financial performance.
Defense and Diversified End Market Decline: The defense component of the Defense and Diversified end market declined in 2025, which could impact future revenue streams.
SMR Market Uncertainty: While the SMR market presents growth opportunities, its rapid evolution and dependency on licensing and regulatory approvals pose risks to Mirion's strategic objectives.
Capital Structure and Debt Management: Although debt refinancing reduced interest expenses, the company remains exposed to risks associated with maintaining favorable capital structure and managing convertible notes.
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Guidance & Outlook
2026 Revenue Growth: Total revenue is expected to grow between 22% and 24%, including tailwinds from FX and acquisition-related growth from Certrec and Paragon. Organic revenue growth is projected at 5% to 7%.
Adjusted EBITDA Guidance: Expected to range between $285 million and $300 million, equating to adjusted EBITDA margins of 25% to 26%, with approximately 90 basis points of margin expansion.
Adjusted Free Cash Flow: Projected to range from $155 million to $175 million, driven by growing earnings and capital structure improvements, despite a modest increase in expected CapEx for AI and strategic initiatives.
Adjusted Earnings Per Share (EPS): Expected to range from $0.50 to $0.57, reflecting 275 million fully diluted shares and including stock-based compensation.
Nuclear Power Market Growth: Double-digit organic revenue growth is expected in 2026, supported by a robust pipeline of large opportunity projects worth over $400 million, including $200 million carried over from 2025.
Medical Segment Growth: Double-digit organic revenue growth is anticipated in the nuclear medicine end market, with mid-single-digit growth expected in RTQA, driven by new product launches and market recovery.
Paragon and Certrec Integration: Integration efforts will focus on commercial integration, pricing improvements, and supply chain optimization, with Paragon expected to become margin accretive within the planning horizon.
SMR Market Expansion: Mirion has contractual commitments with over 20 SMR developers, enhancing its position in the evolving SMR space and increasing opportunities for legacy solutions.
Q1 2026 Performance: Q1 is expected to be the lightest quarter for revenue and adjusted EBITDA, with low single-digit organic revenue growth and margin contraction due to the full impact of Paragon.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:Can the large opportunity pipeline translate to double-digit growth in backlog in 2026, especially with nuclear power now being almost half of the sales?
A:Thomas Logan acknowledged the complexity of large project timing and hesitated to draw a tight correlation between large projects and expected timing. However, he expressed confidence in the quality of the pipeline and the dynamics in the nuclear power vertical, which he believes will drive an accelerating rate of growth.
Q:What is the outlook for Medical in 2026, given the mid-single-digit growth guidance for Q1?
A:Brian Schopfer explained that the team is optimistic about the dynamics in the first quarter across all three businesses. He noted that the back half of the year is expected to be easier due to strong shipments to China in Q2 of the previous year. He emphasized that the guidance was carefully considered.
Q:What is the expected EBITDA number for Q1, considering the accretion from Paragon and seasonality?
A:Brian Schopfer did not provide a specific number but mentioned that Q1 would be the lightest quarter for Paragon, with seasonality similar to Mirion. He highlighted the dilutive nature of Paragon's margins and lighter volume in the sensing business, which would result in margin contraction in Q1.
Q:How are customer conversations and win rates evolving for the $400 million large project pipeline for 2026?
A:Thomas Logan did not disclose specific win rates but emphasized the positive impact of Certrec and Paragon on customer engagement. He highlighted Paragon's strong customer intimacy and the broader solution set, which he believes will improve traction and win rates.
Q:What is the expectation for Medical business margins in 2026, given the strong performance in 2025?
A:Brian Schopfer expects good margin expansion in 2026 but not as high as in 2025. He mentioned that the 50% incremental margin might be slightly high but still anticipates strong and robust margins.
Q:Is the target of 30%+ EBITDA margins by 2028 still intact, given the 2026 guidance of 25%-26%?
A:Thomas Logan affirmed the target, citing growth, self-help initiatives, and AI as key drivers. He acknowledged challenges but expressed confidence in achieving the target through continuous improvement and leveraging AI for productivity and customer-facing applications.
Q:What are the short to mid-term goals for AI and digital strategies?
A:Thomas Logan stated that the goals are under development, as the Chief AI and Digital Officer, Shahmeer Mirza, has only been on board for a few months. He highlighted the potential of AI in customer-facing applications and internal productivity, particularly in the nuclear vertical.
Q:What accounts for the 25% growth expectation for Paragon in 2026, and what are the implications for Mirion's nuclear power business?
A:Brian Schopfer attributed the growth to strong order growth in 2025 and expansion into the DOE landscape. Thomas Logan emphasized the strategic alignment and customer intimacy of Paragon, which he believes will drive more wallet share and innovation in the nuclear power sector.
Q:How does the NRC's life extension activity for reactors impact Mirion's orders and pipeline?
A:Thomas Logan noted that life extensions, upgrades, and modernization are key drivers for the global fleet, contributing to Mirion's 11% growth in nuclear power in 2025. He highlighted the significant content in previously decommissioned plants coming back online.
Q:How much contribution from the $150 million large orders booked in 2025 is expected in 2026?
A:Brian Schopfer stated that there is some contribution, but the first year of large contracts tends to be the lightest, with more significant impact in subsequent years.
Q:How material are SMRs to Mirion's growth story in 2026 and beyond?
A:Thomas Logan highlighted the engagement with over 20 SMR projects and the extraordinary order growth in 2025. Brian Schopfer noted that SMRs are expected to contribute less than 3% of total revenue in 2026 but remain a significant area of focus for future growth.
Q:What is the progress and strategic importance of the Certrec acquisition?
A:Thomas Logan described Certrec as a leader in outsourced regulatory compliance with a strong SaaS platform and extensive data. He emphasized the focus on leveraging AI and expanding globally, calling it a 'jewel of a business' with significant potential.
Q:What are the opportunities in nuclear medicine, particularly with Novartis building new manufacturing sites?
A:Thomas Logan and Brian Schopfer highlighted the strategic focus on nuclear medicine, including hardware and software integration and building relationships with key players. They noted the significant equipment requirements for Novartis' facilities and the potential for growth in this vertical.
Q:Review of Unclear Management Responses
A:Management avoided providing specific win rates for the large project pipeline and did not disclose a specific EBITDA number for Q1. Additionally, they did not provide detailed KPIs for AI and digital strategies, citing that these are still under development.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Founder
Group President
Labs Research
Medical Group
Mirion work
Panel headline
RTQA market
SMR developer
acquisition Certrec
build SMR
economy
financials
gigawatt center
government shutdown
integration
legacy Mirion
market order
medicine order
opportunity Mirion
opportunity project
order comp
panel
position
power exposure
power market
presence
record order
revenue cash
space Certrec
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MIR Transcript
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Positive2-11
The earnings call highlighted strong financial metrics, optimistic guidance, and strategic acquisitions, particularly in the nuclear sector. The company's focus on AI and digital strategies, along with a positive outlook for 2025 and beyond, supports a positive sentiment. While some uncertainties remain, such as specific win rates and AI KPIs, the overall narrative is growth-oriented, with significant opportunities in nuclear power and medicine. Given the mid-cap status, the market is likely to react positively, but not excessively, resulting in a positive prediction of 2% to 8% stock price increase.
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The earnings call summary and Q&A session indicate positive sentiment: increased guidance for 2025, strong nuclear and medical segment outlooks, and strategic partnerships. Despite some uncertainties in timing and specifics, the overall confidence in market opportunities, especially in nuclear power and SMR projects, is evident. The raised guidance and strategic acquisitions further support a positive outlook. Given the market cap, a 2% to 8% stock price increase is expected.
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The earnings call summary reveals strong financial performance with strategic acquisitions and partnerships, optimistic guidance, and a share repurchase program. Despite some cautious language in the Q&A, management remains confident in growth opportunities and margin expansion. The market cap suggests moderate volatility, aligning with a positive stock price movement prediction.
MIR Slides
MIR Report
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