MDS Nordion of Ottawa reported a sharp drop in revenue for its third quarter (end-July 31) due to the prolonged shutdown of a nuclear reactor operated by the Canadian government's Atomic Energy of Canada (AECL) agency.
For the period, MDS posted revenue of $199 million (U.S.), down 21% compared to $252 million in the third quarter of 2008. Revenue declined 16% when adjusted for currency changes and acquisitions. The company posted a net loss of $62 million, compared with a net loss of $10 million in the corresponding quarter of 2008.
MDS relies on AECL's National Research Universal (NRU) reactor for its supply of molybdenum-99, which it reprocesses and distributes to commercial suppliers. AECL shut down the NRU reactor in May due to a water leak, and the facility may not resume operations until early 2010.
In addition to the impact from the NRU shutdown, MDS said that softening demand for its services from contract research organizations led to lower revenues. The firm highlighted its decision to sell its MDS Analytical Technologies business to Danaher of Washington, DC, a deal that will bring in $650 million in cash.
Related Reading
MDS to divest non-Nordion units, September 2, 2009
MDS offers plan to fix Maple reactors, July 31, 2009
MDS urges Canada to complete Maple project, July 9, 2009
MDS urges Canada to restart Maple reactor project, June 12, 2009
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