Nordion Reports Second Quarter 2011 Financial Results

June 7, 2011

Continued progress in value-creating business initiatives

Nordion Highlights:

        --  Strong second quarter year-over-year TheraSphere® revenue
            growth of 47%
        --  Second quarter Sterilization Technologies revenue boosted by
            shipment of production irradiator
        --  Received U.S. FDA approval to proceed with TheraSphere® Phase
            III trials for primary and metastatic liver cancer

Nordion reports in U.S. dollars unless otherwise specified

OTTAWA, June 7, 2011 /PRNewswire/ – Nordion Inc. (TSX: NDN) (NYSE: NDZ), a
leading provider of products and services to the global health sciences
market, announced today second quarter 2011 revenues from continuing
operations of $68.3 million, up 32% from $51.8 million in the second
quarter 2010. Income from continuing operations was $6.8 million ($0.11
earnings per share), compared with a loss from continuing operations of
$49.0 million ($0.48 loss per share) in the second quarter 2010.

“Nordion made solid progress during the second quarter, advancing
value-creating initiatives, and increasing the diversification of
revenue across our product portfolio,” said Mr. Steve West, Chief
Executive Officer, Nordion Inc. “We’re very pleased with TheraSphere’s
growth and the reliable cash flow generation from our Sterilization
Technologies business.”

“On the Medical Isotopes front, we await the outcome of the planned
National Research Universal (NRU) reactor inspection and anticipate
being in a stronger competitive position following the restart,”
continued Mr. West.

Key Q2 2011 Events:

        --  On March 10, 2011, Nordion announced the appointment of Janet
            Woodruff and Sean Murphy to its Board of Directors.
        --  On March 23, 2011, Nordion announced that the U.S. Food and
            Drug Administration approved the Company's application to
            proceed with Phase III TheraSphere® trials for hepatocellular
            carcinoma and metastatic liver cancer.
        --  On March 28, 2011, Nordion shared results from the first
            multi-site, Phase II clinical trial to evaluate TheraSphere®
            for treatment of metastatic liver cancer. Initial analysis of
            trial data led researchers to suggest that TheraSphere® is a
            safe, well-tolerated treatment for patients with liver
        --  On March 31, 2011, Nordion completed the divestiture of its
            Belgian operations, MDS Nordion S.A., excluding the
            TheraSphere® business in Europe.
        --  On April 1, 2011, Nordion paid its initial quarterly cash
            dividend of $0.10 per share.
        --  As of April 30, 2011, Nordion had repurchased 2.8 million
            common shares at a cost of $32.7 million.

Subsequent to the quarter:

        --  On May 15, 2011, a 33-day planned outage started at the NRU
        --  On June 6, 2011, Nordion announced it had secured a three-year
            revolving, committed credit facility for $75 million

Second Quarter 2011 Results
As of the second quarter fiscal 2011the divested Belgian financial
results are reported under discontinued operations in current and
comparative period.

Consolidated Financial Results

                       Three months ended April 30 Six monthsended April 30

    (thousands of U.S.
    dollars, except
    when noted)              2011             2010       2011          2010

    Revenues           $   68,258 $         51,764 $  133,220 $      92,457

    Gross margin              52%              51%        53%           51%

    Operating income
    (loss) from
    operations         $    8,406 $       (49,054) $   41,142 $    (89,584)

    Loss from
    operations, net of
    income taxes       $ (14,291) $       (40,794) $ (18,243) $   (143,086)

    Net (loss) income  $  (7,478) $       (89,771) $   14,067 $   (232,618)

    Basic earnings
    (loss) per share
    from continuing
    operations         $     0.11 $         (0.48) $     0.49 $      (0.80)

    Cash and cash
    equivalents        $   63,892 $        133,577 $   63,892 $     133,577

    Share buyback
    (thousands of
    shares)                 2,522           52,941      2,838        52,941

    Weighted average
    number of Common
    shares outstanding
    - basic (thousands
    of shares)             64,552          102,505     65,843       111,321
        --  Consolidated revenue from continuing operations in the second
            quarter 2011 were $68.3 million, up $16.5 million or 32%,
            compared with the second quarter 2010. The increase was
            primarily due to increased revenues from reactor isotopes in
            the Medical Isotopes segment as a result of the NRU reactor
            resuming operations in August 2010, and higher Targeted
            Therapies revenues primarily due to increased shipments of
            TheraSphere®. Sterilization Technologies partially offset the
            increase with lower cobalt-60 (Co-60) revenue due to timing of
            usual fluctuations in the shipments of Co-60 to customers.
        --  Gross margin was 52%, compared with 51% in the second quarter
            of the previous fiscal year due to the NRU reactor resuming
        --  Operating income from continuing operations in the second
            quarter 2011 was $8.4 million, up from a loss of $49.1 million
            in the second quarter 2010. Improved segment earnings from
            Medical Isotopes and Targeted Therapies and lower corporate
            selling, general and administrative expense contributed to the
            increase in operating income.

Segment Financial Results (with reconciliation to Net (loss) income)

                        Three months ended April30 Six months ended April30

    (thousands of U.S.
    dollars, except per
    share amounts)            2011            2010       2011          2010


      Medical Isotopes  $   27,574 $        10,167 $   56,981 $      17,936

    Therapies               15,359          13,605     32,164        27,214

    Technologies            25,325          27,992     44,075        47,307

    segment revenues
    from continuing
    operations          $   68,258 $        51,764 $  133,220 $      92,457

    Segment earnings

      Medical Isotopes  $    9,738 $          (96) $   22,148 $     (1,347)

    Therapies                3,550           1,870      8,322         5,632

    Technologies             9,685          13,396     16,349        21,398

      Corporate and
    Other                  (7,797)        (37,314)    (8,991)      (49,602)

    Total segment
    earnings (loss)     $   15,176 $      (22,144) $   37,828 $    (23,919)

      Depreciation and
    amortization             5,346           8,231     10,579        14,646

      Gain on sale of
    investment             (1,691)               -    (1,691)             -

    charges, net               843          17,766        535        51,443

      AECL arbitration
    and legal costs          2,973           1,122      6,579         1,509

      Impairment of
    long-lived assets            -           1,371          -         1,371

      Change in fair
    value of embedded
    derivatives              (701)         (1,580)   (19,316)       (3,304)

    operating income
    (loss) from
    operations          $    8,406 $      (49,054) $   41,142 $    (89,584)

    Net interest income      2,245           1,119      3,722         1,644

    Equity loss                  -           (523)      (128)         (598)

    Income tax expense     (3,838)           (519)   (12,426)         (994)

    Loss from
    operations net of
    income taxes          (14,291)        (40,794)   (18,243)     (143,086)

    Net (loss) income   $  (7,478) $      (89,771) $   14,067 $   (232,618)

Medical Isotopes
Medical Isotopes revenue of $27.6 million in the second quarter 2011
increased by $17.4 million or 171% compared to the second quarter 2010.
Reactor isotopes revenue was $21.9 million and cyclotron isotopes
revenue was $5.7 million this quarter, compared to $3.6 million and
$6.6 million, respectively, in the same period of the prior year.

The year-over year increase in reactor isotopes revenue was primarily
due to the NRU reactor resuming operations in August 2010 after a
15-month shutdown. Cyclotron isotopes revenue decreased in the second
quarter 2011 compared to same period in 2010 as thallium-201, used as a
substitute for Mo-99, declined due to the availability of Mo-99
following the restart of the NRU reactor.

Targeted Therapies
Targeted Therapies revenue of $15.4 million in the second quarter 2011
increased by $1.8 million or 13% compared to the second quarter 2010.
The increase was driven by continued strong performance of
TheraSphere®. TheraSphere® revenue was $11.2 million in the second
quarter 2011, up $3.6 million or 47% compared to the second quarter

Nordion’s manufacturing activities for CardioGen-82 contributed nominal
revenue in the second quarter 2011 due to a manufacturing interruption
that started early this quarter.

Sterilization Technologies
Sterilization Technologies revenue of $25.3 million in the second
quarter 2011 decreased by $2.7 million or 10% compared to the second
quarter 2010. Revenue from cobalt sales were $19.6 million in the
second quarter, down $8.0 million or 29% compared to the second quarter
2010. The decrease in segment revenue was partially offset by a
shipment of a production irradiator.

Corporate and Other
Corporate and Other recorded a loss of $7.8 million in the second
quarter 2011, down $29.5 million or 79% compared to the second quarter
2010 as Nordion has substantially completed its strategic repositioning
activities. Corporate selling, general and administrative expenses were
$3.1 million. Other expenses, net of $4.2 million were recorded during
the quarter, including a foreign exchange loss of $4.5 million.

Discontinued Operations
Nordion recorded a loss from discontinued operations, net of income
taxes of $14.3 million in the second quarter 2011, down $26.5 million
or 65% compared to the second quarter 2010. The loss from discontinued
operations in the second quarter 2011 resulted from the sale of MDS
Nordion S.A., Nordion’s Belgium operations, and certain tax adjustments
and settlements relating to the discontinued operations of MDS Pharma
Services and MDS Analytical Technologies.

Outlook Summary (for a more detailed Outlook please refer to Nordion’s
second quarter fiscal 2011 Management Discussion &Analysis)

Medical Isotopes
Due to the planned NRU reactor maintenance and inspection shutdown,
expected by the Atomic Energy Canada Limited to be 33 days in duration
starting from May 15, 2011, Nordion expects Q3 2011 reactor isotopes
revenue to be significantly below Q2 2011 reactor isotopes revenue. If
the NRU reactor restarts as planned on June 17, 2011, Nordion expects
Mo-99 supply to be available for customers beginning the week of June
20, 2011.

Nordion continues to work with existing customers and potential new
customers to secure additional sales of medical isotopes and increase
global market share of Mo-99.

Moly-99 from Russia’s Isotope
In addition to not receiving back-up supply from Isotope during the
current NRU shutdown, Nordion has reduced its overall forecast of Mo-99
supply quantities that the Company expects to receive from Isotope
during the life of the current contract. Initial quantities supplied
are expected to be at lower levels than previously forecasted, and the
ramp up to full production levels is anticipated to take longer than
expected. In addition, Nordion expects Isotope to reach its full
currently planned production capacity prior to 2016. While the current
estimate of supply levels from Isotope is lower than previously
estimated, Nordion continues to believe that Isotope can be a
significant component of the Company’s supply chain in the future.

Targeted Therapies
For the full year of 2011, Nordion expects TheraSphere® to grow at or
above the 40% growth rate experienced in 2010.

The ongoing issue with a third party supplied component for
CardioGen-82(TM) is expected to continue to impact financial results in
the third quarter 2011 and possibly into the fourth quarter. Nordion
expects to partially mitigate the financial impact of this issue
through the sale of bulk Strontium-82 (Sr-82), the isotope used in the
manufacturing of CardioGen-82(TM) generators. Sr-82 revenue is recorded
under cyclotron isotopes revenue in the Medical Isotopes segment.

Sterilization Technologies
Nordion expects Co-60 shipments in the third and fourth quarters 2011 to
be higher than the second quarter 2011. The Company continues to expect
Co-60 volume for full fiscal 2011 to be approximately equal with fiscal

Credit Facility
Subsequent to the second quarter 2011, Nordion established a $75
million, three-year credit facility. Nordion plans to use the credit
facility to reissue existing letters of credit, which would in turn
release approximately $20 million in restricted cash, to issue future
letters of credit, and to provide an additional source of liquidity.

A full copy of Nordion’s second quarter 2011 Management’s Discussion and
Analysis and the financial statements and notes (unaudited) can be
downloaded at www.nordion.com/investors/financial_results.asp.

Conference Call
Nordion will hold a conference call on Wednesday, June 8, 2011 at 9:30
am ET to discuss its second quarter 2011 results. This call will be
webcast live at www.nordion.com, and will be available after the call in archived format at www.nordion.com/investors/webcasts_and_presentations.asp. To participate, please dial 1-800-952-6845 (toll-free North America)
or 1-416-695-7848 (International).

About Nordion Inc. 
Nordion Inc. (TSX: NDN) (NYSE: NDZ) is a global specialty health science
company that provides market-leading products used for the prevention,
diagnosis and treatment of disease. We are a leading provider of
medical isotopes, targeted therapies and sterilization technologies
that benefit the lives of millions of people in more than 60 countries
around the world. Our products are used daily by pharmaceutical and
biotechnology companies, medical-device manufacturers, hospitals,
clinics and research laboratories. Nordion has more than 500 highly
skilled employees in three locations. Find out more at www.nordion.com.

Caution Concerning Forward-Looking Statements

From time to time, we make written or oral forward-looking statements
within the meaning of certain securities laws, including under
applicable Canadian securities laws and the “safe harbour” provisions
of the United States Private Securities Litigation Reform Act of
1995. This document contains forward-looking statements including the
strategy of the continuing businesses, as well as statements with
respect to our beliefs, plans, objectives, expectations, anticipations,
estimates and intentions. The words “may”, “could”, “should”, “would”,
“outlook”, “believe”, “plan”, “anticipate”, “estimate”, “project”,
“expect”, “intend”, “indicate”, “forecast”, “objective”, “optimistic”,
and words and expressions of similar import, are intended to identify
forward-looking statements.

By their very nature, forward-looking statements involve inherent risks
and uncertainties, both general and specific, which give rise to the
possibility that predictions, forecasts, projections and other
forward-looking statements will not be achieved. We caution readers not
to place undue reliance on these statements as a number of important
factors could cause our actual results to differ materially from the
beliefs, plans, objectives, expectations, anticipations, estimates and
intentions expressed in such forward-looking statements. These factors
include, but are not limited to: management of operational risks; our
ability to secure a reliable supply of raw materials, particularly
cobalt and critical medical isotopes; the effects of competition in the
markets in which we operate; our ability to manage long-term supply
commitments; our reliance on one customer for the majority of our sales
of medical isotopes; our ability to maintain regulatory approval for
the manufacturing, distribution and sale of our products; the strength
of the global economy, in particular the economies of Canada, the U.S.,
the European Union, Asia, and the other countries in which we conduct
business; the stability of global equity markets; assets and
liabilities that we retained from the businesses sold; obligations
retained and projected adjustments thereto; successful implementation
of structural changes, including restructuring plans; our ability to
complete other strategic transactions and to execute them successfully;
our ability to negotiate future credit agreements, which may or may not
be on terms favorable to us; the impact of the movement of the U.S.
dollar relative to other currencies, particularly the Canadian dollar
and the euro; changes in interest rates in Canada, the U.S., and
elsewhere; the timing and technological advancement of new products
introduced by us or by our competitors; our ability to manage our
research and development; the impact of changes in laws, trade policies
and regulations including health care reform, and enforcement thereof;
regulatory actions; judicial judgments and legal proceedings, including
legal proceedings described in this document; our ability to maintain
adequate insurance; our ability to successfully realign our
organization, resources and processes; our ability to retain key
personnel; our ability to have continued and uninterrupted performance
of our information technology and financial systems; our ability to
compete effectively; the risk of environmental liabilities; new
accounting standards that impact the policies we use to report our
financial condition and results of operations; uncertainties associated
with critical accounting assumptions and estimates; the possible impact
on our businesses from third-party special interest groups; our ability
to negotiate and maintain collective-bargaining agreements for certain
of our employees; natural disasters; public health emergencies and
pandemics; international conflicts and other developments including
those relating to terrorism; other risk factors described in section 5
of our AIF; and our success in anticipating and managing these risks.

The foregoing list of factors that may affect future results is not
exhaustive. When relying on our forward-looking statements to make
decisions with respect to the Company, investors and others should
carefully consider the foregoing factors and other uncertainties and
potential events. We do not undertake to update any forward-looking
statement, whether written or oral, that may be made from time to time
by us or on our behalf, except as required by law.

SOURCE Nordion Inc.

Source: newswire

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