Sotera Health Co
For the period ended Sep 30, 2025. Filed Nov 4, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 4, 2025
SHC$16.01+0.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-08.
0001822479-25-000044
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-11-04.
0001822479-25-000054
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 168 previous paragraphs and 167 current paragraphs.
85 unchanged; 62 reworded; 18 added; 19 removed; 2 previous and 2 current paragraphs rearranged.
Tables are not compared: 10 previous and 10 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Cost of service revenues increased $3.3 million, or 2.9%, for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase was attributable to inflation, which primarily impacted direct materials, energy and employee compensation costs. Partially offsetting these factors was a decrease in labor costs related to expert advisory services in the Nelson Labs segment.
Current report
Loss on refinancing of debt for the three months ended September 30, 2025 was $1.1 million relating to the write-off of certain unamortized debt issuance costs and discounts on the Term Loan in connection with Amendment No. 6 to the Credit Agreement.
Current report
Foreign Exchange Gain
Current report
Other income, net decreased $2.4 million, or 83.6%, for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The fluctuation was mainly driven by unfavorable changes in the fair value of embedded derivatives incertain of Nordion’s customer and supply contracts.
Current report
Provision for income tax decreased $1.2 million to a net provision of $24.5 million for the three months ended September 30, 2025 as compared to $25.8 million in the three months ended September 30, 2024. The change was attributable to recognition of the cumulative tax effects of the change in U.S. income tax laws under the OBBBA in the period of enactment associated with the accounting for the valuation allowance attributable to the limitation on the deductibility of interest expense. This was offset byhigher pre-tax income, the tax effects for a change in our indefinite reinvestment assertion with respect to a portion of our foreign earnings, and an increase in current year permanent tax differences.
Current report
Nine Months Ended September 30, 2025 as compared to Nine Months Ended September 30, 2024
Current report
Cost of service revenues increased $4.2 million, or 1.3%, for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was attributable to inflation, which primarily impacted energy, direct materials, and professional services costs. Partially offsetting these factors was a decrease in labor costs related to expert advisory services in the Nelson Labs segment.
Current report
Foreign Exchange Gain
Current report
Other income, net increased $2.4 million, or 59.9%, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The primary driver of this increase was a favorable change in the fair value of embedded derivatives incertain of Nordion’s customer and supply contracts.
Current report
Provision for income tax decreased $2.9 million to a net provision of $33.9 million for the nine months ended September 30, 2025 as compared to $36.8 million for the nine months ended September 30, 2024. The change was attributable to recognition of the cumulative tax effects of the change in U.S. income tax laws under the OBBBA in the period of enactment associated with the accounting for the valuation allowance attributable to the limitation on the deductibility of interest expense. This was offset byhigher pre-tax income, the tax effects for a change in our indefinite reinvestment assertion with respect to a portion of our foreign earnings and an increase in current year permanent tax differences.
Current report
Results for our Nordion segment are also impacted by Co-60 mix and harvest schedules, as well as customer, product and service mix.
Current report
Sterigenics net revenues were $192.8 million for the three months ended September 30, 2025, an increase of $17.3 million, or 9.8%, as compared to the three months ended September 30, 2024. The increase was attributable to a 4.6% increase in volume and mix, a 3.8% favorable impact from pricing and a 1.4% benefit from changes in foreign currency exchange rates.
Current report
Nordion net revenues were $62.8 million for the three months ended September 30, 2025, an increase of $11.5 million, or 22.4%, as compared to the three months ended September 30, 2024. The increase was driven by favorable volume and mix of 18.9% and a 4.7% impact from pricing, partially offset by a 1.2% unfavorable impact from changes in foreign currency exchange rates.
Current report
Nordion segment income was $38.0 million for the three months ended September 30, 2025, an increase of $6.3 million, or 19.9%, as compared to the three months ended September 30, 2024. The increase in segment income was attributable to growth in volume and mix andbenefits from customer pricing. Segment income margin decreased as a result of product mix.
Current report
Nordion net revenues were $137.8 million for the nine months ended September 30, 2025, an increase of $21.2 million, or 18.2%, as compared to the nine months ended September 30, 2024. The increase was driven by favorable changes in volume and mix of 16.7% and pricing of 3.1%, partially offset by anunfavorable impact from changes in foreign currency exchange rates of 1.6%.
Current report
Cash flows from operating activities increased $15.6 million to net cash provided of $184.1 million in the nine months ended September 30, 2025 compared to net cash provided of $168.4 million for the nine months ended September 30, 2024. The increase in cash flows from operating activities in the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was mainly attributable to an increase in gross profit coupled with a decrease in cash paid for interest, partially offset by an increase in cash paid for income taxes.
Current report
Under the debt agreements summarized below, at September 30, 2025 we and Sotera Health Holdings, LLC (“SHH”), our wholly owned subsidiary, have debt payment obligations under (a) a term loan in the amount of $1,423.0 million, (b) a revolving credit facility, which supported operationally-related letters of credit but was otherwise undrawn, and which provides to us capacity up to $600.0 million for future potential borrowings, and (c) $750.0 million of senior notes. Our debt agreements also include additional covenants, conditions and rights to request additional debt, as summarized below.
Current report
On September 17, 2025, the Company and SHH entered into Amendment No. 6 (“Amendment No. 6”) to the Credit Agreement. Among other changes, Amendment No. 6 provides for refinancing lenders to provide term loans (the “Repriced Term Loans”) to SHH in an aggregate principal amount of $1,423.0 million, which reflects the balance after the Company’s application of $75.0 million of available cash to repay outstanding borrowings under its term loan facility. Amendment No. 6 also reduces the interest rate spread by 0.50% across term loans under the facility, such that the Repriced Term Loans have an applicable interest rate margin equal to the Adjusted Term SOFR (as defined in the Credit Agreement) plus 2.50%, with a 0.00% floor (with optionality for the Company to elect Alternate Base Rate plus 1.50% or Adjusted Daily Simple SOFR plus 2.50% (each as defined in the Credit Agreement)). This pricing reflects both the 0.50% reduction implemented through Amendment No. 6 and a 0.25% contractual pricing step-down that was triggered in August 2025. The Repriced Term Loans are also subject to a “soft call” premium of 1.00% for certain repricing transactions with respect to the Repriced Term Loans that occur within the six-month period after the effective date of Amendment No. 6. The Repriced Term Loans amortize at a rate of 1.00% per annum and matures on May 30, 2031.
Removed paragraphs (19)
Previous report
Cost of service revenues increased $4.2 million, or 3.8%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. The increase was attributable to incremental depreciation and unfavorable changes in foreign currency exchange rates.
Previous report
Foreign Exchange Loss (Gain)
Previous report
Other income, net increased $4.3 million, or 283.2%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024, mainly arising from a $3.5 million favorable increase in the net fair value of Nordion’s embedded derivatives in the three months ended June 30, 2025 compared to the same period of the prior year.
Previous report
Provision for income taxes increased $4.5 million to a net provision of $10.9 million for the three months ended June 30, 2025 as compared to $6.4 million in the three months ended June 30, 2024. The change was primarily attributable to higher pre-tax income for the three months ended June 30, 2025 compared to the three months ended June 30, 2024, and an increase in current year permanent tax differences.
Previous report
On July 4, 2025, new U.S tax legislation was signed into law (commonly referred to as the "One Big Beautiful Bill Act" or "OBBBA"). The OBBBA makes many of the temporary tax provisions enacted in 2017 as part of the Tax Cuts and Jobs Act permanent. Additionally, the OBBBA makes changes to certain U.S. corporate tax provisions, many of which are not effective until 2026. The Company is currently evaluating the impact of the OBBBA but does not expect it to have a material impact on its results of operations.
Previous report
Six Months Ended June 30, 2025 as compared to Six Months Ended June 30, 2024
Previous report
Total Cost of Revenues
Previous report
Cost of service revenues increased $0.9 million, or 0.4%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. The change was attributable to incremental depreciation, partially offset by a favorable impact from changes in foreign currency exchange rates.
Previous report
Illinois EO litigation settlements
Previous report
Foreign Exchange Loss (Gain)
Previous report
Other income, net increased $4.8 million, or 385.7%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024, mainly arising from a $3.8 million favorable increase in the net fair value of Nordion’s embedded derivatives in the six months ended June 30, 2025 compared to the same period of the prior year.
Previous report
Provision for income taxes decreased $1.7 million to a net provision of $9.4 million for the six months ended June 30, 2025 as compared to $11.1 million in the six months ended June 30, 2024. The change was primarily attributable to lower pre-tax income for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, partially offset by current year permanent differences.
Previous report
Net (Loss) Income, Adjusted Net Income and Adjusted EBITDA
Previous report
Nordion net revenues were $42.4 million for the three months ended June 30, 2025, an increase of $1.2 million, or 2.9%, as compared to the three months ended June 30, 2024. The increase was attributable to favorable pricing of 2.3% and volume/mix of 1.1%, partially offset by an unfavorable impact from changes in foreign currency exchange rates of 0.5%.
Previous report
Nordion segment income was $23.5 million for the three months ended June 30, 2025, an increase of $0.1 million, or 0.2%, as compared to the three months ended June 30, 2024. The change in segment income was mainly attributable to higher volumes of industrial use Co-60, partially offset by higher direct material costs. Segment income margin declined primarily due to supplier mix.
Previous report
Sterigenics net revenues were $364.5 million for the six months ended June 30, 2025, an increase of $21.7 million, or 6.3%, as compared to the six months ended June 30, 2024. The increase was primarily attributable to favorable impacts from pricing of 4.1% and improvements in volumes and mix of 3.0%, partially offset by unfavorable changes in foreign currency exchange rates of 0.8%.
Previous report
Nordion net revenues were $75.0 million for the six months ended June 30, 2025, an increase of $9.7 million, or 14.9%, as compared to the six months ended June 30, 2024. The increase was driven by favorable volumes and changes in mix of 15.0%, and a favorable impact from pricing of 1.8%, partially offset by an unfavorable impact from changes in foreign exchange rates of 1.9%.
Previous report
Cash flows from operating activities increased $41.9 million to net cash provided of $112.9 million in the six months ended June 30, 2025 compared to $71.0 million of net cash used in operating activities for the six months ended June 30, 2024. The change in cash flows from operating activities was primarily driven by the $35.0 million payment of the Georgia EO litigation settlement in January 2024.
Previous report
Senior Secured Credit Facilities
Reworded paragraphs (62)
Previous wording
For the three and six months ended June 30, 2025, respectively, we recorded net revenues of $294.3 million and $548.9 million, net income of $8.0 million and net loss of $5.3 million, Adjusted Net Income of $56.1 million and $95.1 million, and Adjusted EBITDA of $150.7 million and $272.6 million. Adjusted Net Income and Adjusted EBITDA are financial measures not based on any standardized methodology prescribed by U.S. Generally Accepted Accounting Principles (“GAAP”). For the definition of Adjusted Net Income and Adjusted EBITDA and the reconciliation of these non-GAAP measures from net income (loss), please see “Non-GAAP Financial Measures.”
Current wording
For the three and nine months ended September 30, 2025, respectively, we recorded net revenues of $311.3 million and $860.2 million, net income of $48.4 million and $43.1 million, Adjusted Net Income of $75.3 million and $170.4 million, and Adjusted EBITDA of $164.2 million and $436.8 million. Adjusted Net Income and Adjusted EBITDA are financial measures not based on any standardized methodology prescribed by GAAP. For the definition of Adjusted Net Income and Adjusted EBITDA and the reconciliation of these non-GAAP measures from net income, please see “Non-GAAP Financial Measures.”
Previous wording
Net revenues were $294.3 million in the three months ended June 30, 2025, an increase of $17.7 million, or 6.4%, as compared with the three months ended June 30, 2024. Excluding the impact of foreign currency exchange rates, net revenues in the three months ended June 30, 2025 increased approximately 6.0% compared with the three months ended June 30, 2024.
Current wording
Net revenues were $311.3 million in the three months ended September 30, 2025, an increase of $25.8 million, or 9.1%, as compared with the three months ended September 30, 2024. Excluding the impact of foreign currency exchange rates, net revenues in the three months ended September 30, 2025 increased approximately 8.0% compared with the three months ended September 30, 2024.
Previous wording
Service revenues increased $19.5 million, or 8.2%, to $257.2 million in the three months ended June 30, 2025 as compared to $237.8 million in the three months ended June 30, 2024. The growth in net service revenues was driven by improvements in volume/mix in the Sterigenics and Nordion segments and core lab testing service volume/mix in the Nelson Labs segment. In addition, favorable pricing and changes in foreign currency exchange rates contributed to the increase in net service revenues. Partially offsetting these factors was a decline in expert advisory services revenue in the Nelson Labs segment.
Current wording
Service revenues increased $16.7 million, or 7.0%, to $255.5 million in the three months ended September 30, 2025 as compared to $238.8 million in the three months ended September 30, 2024. The growth in net service revenues was driven by increases in volume/mix in the Sterigenics and Nordion segments and core lab testing service volume/mix in the Nelson Labs segment. In addition, favorable pricing and changes in foreign currency exchange rates contributed to the increase in net service revenues. Partially offsetting these factors was a decline in expert advisory services revenue in the Nelson Labs segment.
Previous wording
Product revenues decreased $1.7 million, or 4.5%, to $37.1 million in the three months ended June 30, 2025 as compared to $38.8 million in the three months ended June 30, 2024. The decrease was driven by lower revenues from Co-60 in the Nordion segment due to the timing of reactor harvest schedules.
Current wording
Product revenues increased $9.1 million, or 19.5%, to $55.8 million in the three months ended September 30, 2025 as compared to $46.7 million in the three months ended September 30, 2024. The increase was driven by higher revenues from Co-60 in the Nordion segment due to the timing of reactor harvest schedules.
Previous wording
Total cost of revenues accounted for approximately 43.4% and 44.8% of our consolidated net revenues for the three months ended June 30, 2025 and 2024, respectively.
Current wording
Total cost of revenues accounted for approximately 43.0% and 44.6% of our consolidated net revenues for the three months ended September 30, 2025 and 2024, respectively.
Previous wording
Cost of product revenues decreased $0.2 million, or 1.6%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. The decrease was attributable to a decline in amortization of intangible assets that were fully amortized as of December 31, 2024, partially offset by an increase in the cost of direct materials.
Current wording
Cost of product revenues increased $3.1 million, or 18.6%, for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase was attributable to a change in product revenue volume and mix, partially offset by a decline in amortization of intangible assets that were fully amortized as of December 31, 2024.
Previous wording
SG&A expenses increased $8.3 million, or 13.7%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. A $6.2 million increase in litigation and other professional services expense associated with EO sterilization facilities was the main driver of the increase in SG&A expenses.
Current wording
SG&A expenses increased $1.3 million, or 2.1%, for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The change was the result of an increase litigation and other professional services expense associated with EO sterilization facilities, partially offset by a decline in share-based compensation expense.
Previous wording
Amortization of intangible assets decreased $6.1 million to $9.3 million, or 39.7%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. The decline was primarily due to certain intangible assets that were fully amortized in May 2025.
Current wording
Amortization of intangible assets decreased $12.4 million, or 80.1%, to $3.1 million for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The decline was primarily due to certain intangible assets that were fully amortized in May 2025.
Previous wording
Interest expense, net increased $0.3 million, or 0.7%, for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024, primarily due to a decreased benefit from interest rate derivatives, partially offset by a lower interest rate on our Term Loan. The weighted average interest rate on our outstanding debt was 7.49% and 8.19% at June 30, 2025 and 2024, respectively.
Current wording
Interest expense, net decreased $2.4 million, or 5.8%, for the three months ended September 30, 2025 as compared to the three months ended September 30, 2024, primarily due to a lower interest rate on our Term Loan, partially offset by a decreased benefit from interest rate derivatives. The weighted average interest rate on our outstanding debt was 6.91% and 7.86% as of September 30, 2025 and 2024, respectively.
Previous wording
Foreign exchange loss was $0.6 million for the three months ended June 30, 2025 as compared to a gain of $0.6 million in the three months ended June 30, 2024. The change in foreign exchange loss (gain) in our Consolidated Statements of Operations and Comprehensive Income (Loss) mainly relates to short-term gains and losses on transactions denominated in currencies other than the functional currency of our operating entities. As described in Note 15, “Financial Instruments and Financial Risk”, we enter into monthly U.S. dollar-denominated foreign currency forward contracts to manage foreign currency exchange rate risk related to our international subsidiaries.
Current wording
Foreign exchange gain was $1.5 million for the three months ended September 30, 2025 as compared to $1.1 million in the three months ended September 30, 2024. The change in foreign exchange gain in our Consolidated Statements of Operations and Comprehensive Income mainly relates to short-term gains and losses on transactions denominated in currencies other than the functional currency of our operating entities. As described in Note 15, “Financial Instruments and Financial Risk” to our consolidated financial statements, we enter into monthly U.S. dollar-denominated foreign currency forward contracts to manage foreign currency exchange rate risk related to our international subsidiaries.
Previous wording
Provision for income taxes for the three months ended June 30, 2025 differed from the federal statutory rate primarily due to the valuation allowance attributable to the limitation on the deductibility of interest expense, the impact of the foreign rate differential and current year permanent tax differences, partially offset by a benefit for state income taxes. Income tax expense for the three months ended June 30, 2024 differed from the statutory rate primarily due to the valuation allowance attributable to the limitation on the deductibility of interest expense and the impact of the foreign rate differential, partially offset by a benefit for state income taxes.
Current wording
Provision for income taxes for the three months ended September 30, 2025 differed from the statutory rate due to recognition of the cumulative tax effects of the change in U.S. income tax laws under the OBBBA in the period of enactment associated with the accounting for the valuation allowance attributable to the limitation on the deductibility of interest expense. This was offset by the tax effects for a change in our indefinite reinvestment assertion with respect to a portion of our foreign earnings, the impact of the foreign rate differential and an increase in current year permanent tax differences. Provision for income taxes for the three months ended September 30, 2024 differed from the statutory rate primarily due to a net increase in the valuation allowance attributable to the limitation on the deductibility of interest expense, the foreign rate differential, and GILTI, partially offset by a benefit for state income taxes.
Previous wording
Net income for the three months ended June 30, 2025 was $8.0 million, as compared to net income of $8.8 million for the three months ended June 30, 2024 due to the factors described above. Adjusted Net Income was $56.1 million for the three months ended June 30, 2025, as compared to $55.2 million for the three months ended June 30, 2024, and Adjusted EBITDA was $150.7 million for the three months ended June 30, 2025, as compared to $137.3 million for the three months ended June 30, 2024. Please see “Non-GAAP Financial Measures” below for a reconciliation of Adjusted Net Income and Adjusted EBITDA to their most directly comparable financial measure calculated and presented in accordance with GAAP.
Current wording
Net income for the three months ended September 30, 2025 was $48.4 million, as compared to net income of $17.0 million for the three months ended September 30, 2024 due to the factors described above. Adjusted Net Income was $75.3 million for the three months ended September 30, 2025, as compared to $48.9 million for the three months ended September 30, 2024. Adjusted EBITDA was $164.2 million for the three months ended September 30, 2025, as compared to $146.4 million for the three months ended September 30, 2024. Please see “Non-GAAP Financial Measures” below for a reconciliation of Adjusted Net Income and Adjusted EBITDA to their most directly comparable financial measure calculated and presented in accordance with GAAP.
Previous wording
The following table sets forth the components of our results of operations for the six months ended June 30, 2025 and 2024.
Current wording
The following table sets forth the components of our results of operations for the nine months ended September 30, 2025 and 2024.
Previous wording
(a)Adjusted Net Income and Adjusted EBITDA are non-GAAP financial measures. For more information regarding our calculation of Adjusted Net Income and Adjusted EBITDA, including information about their limitations as tools for analysis and a reconciliation of net (loss) income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income and Adjusted EBITDA, please see the reconciliation included below in “Non-GAAP Financial Measures.”
Current wording
(a)Adjusted Net Income and Adjusted EBITDA are non-GAAP financial measures. For more information regarding our calculation of Adjusted Net Income and Adjusted EBITDA, including information about their limitations as tools for analysis and a reconciliation of net income, the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted Net Income and Adjusted EBITDA, please see the reconciliation included below in “Non-GAAP Financial Measures.”
Previous wording
The following table compares our revenues by type for the six months ended June 30, 2025 to the six months ended June 30, 2024.
Current wording
The following table compares our revenues by type for the nine months ended September 30, 2025 to the nine months ended September 30, 2024.
Previous wording
Net revenues were $548.9 million in the six months ended June 30, 2025, an increase of $24.1 million, or 4.6%, as compared with the six months ended June 30, 2024. Excluding the impact of foreign currency exchange rates, net revenues in the six months ended June 30, 2025 increased approximately 5.3% compared with the six months ended June 30, 2024.
Current wording
Net revenues were $860.2 million in the nine months ended September 30, 2025, an increase of $49.9 million, or 6.2%, as compared with the nine months ended September 30, 2024. Changes in foreign currency exchange rates had no material impact on consolidated net revenues in the nine months ended September 30, 2025 compared with the nine months ended September 30, 2024.
Previous wording
Service revenues increased $16.9 million, or 3.7%, to $481.2 million in the six months ended June 30, 2025 as compared to $464.2 million in the six months ended June 30, 2024. The growth in net service revenues was primarily driven by favorable pricing in the Sterigenics and Nelson Labs segments, favorable volume/mix in the Sterigenics and Nordion segments and improvements in volume/mix related to core lab testing services in the Nelson Labs segment. Partially offsetting these factors was a decline in expert advisory services revenue in the Nelson Labs segment coupled with an unfavorable impact from changes in foreign currency exchange rates.
Current wording
Service revenues increased $33.7 million, or 4.8%, to $736.7 million in the nine months ended September 30, 2025 as compared to $703.0 million in the nine months ended September 30, 2024. The growth in net service revenues was primarily driven by favorable pricing in the Sterigenics and Nelson Labs segments, favorable volume/mix in the Sterigenics and Nordion segments and improvements in volume/mix related to core lab testing services in the Nelson Labs segment. Further contributing to these growth factors was a favorable impact from foreign currency exchange rates. Partially offsetting these factors was a decline in expert advisory services revenue in the Nelson Labs segment.
Previous wording
Product revenues increased $7.1 million, or 11.8%, to $67.7 million in the six months ended June 30, 2025 as compared to $60.5 million in the six months ended June 30, 2024. The increase was driven by favorable volume/mix and pricing in the Nordion segment, partially offset by an unfavorable impact from changes in foreign currency exchange rates.
Current wording
Product revenues increased $16.3 million, or 15.2%, to $123.5 million in the nine months ended September 30, 2025 as compared to $107.2 million in the nine months ended September 30, 2024. The increase was driven by favorable volume/mix and pricing in the Nordion segment, partially offset by an unfavorable impact from changes in foreign currency exchange rates.
Previous wording
The following table compares our cost of revenues by type for the six months ended June 30, 2025 to the six months ended June 30, 2024.
Current wording
The following table compares our cost of revenues by type for the nine months ended September 30, 2025 to the nine months ended September 30, 2024.
Previous wording
Total cost of revenues accounted for approximately 45.0% and 46.7% of our consolidated net revenues for the six months ended June 30, 2025 and 2024, respectively.
Current wording
Total cost of revenues accounted for approximately 44.2% and 46.0% of our consolidated net revenues for the nine months ended September 30, 2025 and 2024, respectively.
Previous wording
Cost of product revenues increased $1.0 million, or 4.1%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. The increase was primarily a result of higher volumes of Co-60 shipments, which resulted in increases in direct material and transportation costs, partially offset by a decline in amortization of intangible assets that were fully amortized as of December 31, 2024.
Current wording
Cost of product revenues increased $4.1 million, or 9.9%, for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was attributable to a change in product revenue volume and mix, partially offset by a decline in amortization of intangible assets that were fully amortized as of December 31, 2024.
Previous wording
SG&A expenses increased $13.2 million, or 11.1%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024. A $14.3 million increase in litigation and other professional services expense associated with EO sterilization facilities was the main driver of the increase in SG&A expenses, partially offset by a decrease in share-based compensation expense.
Current wording
SG&A expenses increased $14.5 million, or 8.0%, for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. A $15.2 million increase in litigation and other professional services expense associated with EO sterilization facilities was the main driver of the increase in SG&A expenses, partially offset by a decline in share-based compensation expense.
Previous wording
Amortization of intangible assets decreased $6.5 million to $24.6 million, or 20.9%, for the six months ended June 30, 2025 as compared to the three months ended June 30, 2024. The decline was primarily due to certain intangibles assets that were fully amortized in May 2025.
Current wording
Amortization of intangible assets decreased $18.9 million, or 40.6%, to $27.7 million for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The decline was primarily due to certain intangible assets that were fully amortized in May 2025.
Previous wording
On April 3, 2025, the Company agreed to resolve 97 pending and threatened EO claims in the State of Illinois. Pursuant to the terms of the April Term Sheet, which is subject to the satisfaction of several conditions, the Company agreed to pay $30.9 million to settle the claims.
Current wording
On April 3, 2025, the Company agreed to resolve 97 pending and threatened EO claims in the State of Illinois. Pursuant to the terms of the April Term Sheet, which have been satisfied, the Company paid $30.9 million in September 2025 to settle the claims.
Previous wording
Interest expense, net decreased $0.6 million, or 0.8%, for the six months ended June 30, 2025 as compared to the six months ended June 30, 2024, primarily due to a decline in the variable interest rate on our Term Loan, partially offset by a lower benefit from interest rate derivatives. The weighted average interest rate on our outstanding debt was 7.49% and 8.19% at June 30, 2025 and 2024, respectively.
Current wording
Interest expense, net decreased $3.1 million, or 2.5%, for the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, primarily due to a lower interest rate on our Term Loan and a decrease in the amortization of debt issuance costs, partially offset by a lower benefit from interest rate derivatives. The weighted average interest rate on our outstanding debt was 6.91% and 7.86% as of September 30, 2025 and 2024, respectively.
Previous wording
Loss on refinancing of debt for the three months ended June 30, 2025 was $0.1 million related to Amendment No. 5 to the Revolving Credit Facility. Loss on refinancing of debt for the three months ended June 30, 2024 was $23.4 million and occurred in connection with the refinancing of our capital structure in May 2024. The refinancing activity resulted in the write off of certain unamortized debt issuance costs and discounts on the Term Loans due 2026. In addition, certain new debt issuance costs and discounts were expensed upon the issuance of the Refinancing Term Loans and Secured Notes.
Current wording
Loss on refinancing of debt for the nine months ended September 30, 2025 was $1.2 million relating to the write-off of certain unamortized debt issuance costs and discounts on the Term Loans in connection with Amendment No. 6 to the Credit Agreement. Loss on refinancing of debt for the nine months ended September 30, 2024 was $24.1 million and occurred in connection with the refinancing of our capital structure in May 2024. This refinancing activity resulted in the write off of certain unamortized debt issuance costs and discounts on the Term Loans due 2026 and the expensing of certain new debt issuance costs and discounts upon the issuance of the Refinancing Term Loans and Secured Notes.
Previous wording
Foreign exchange loss was $0.9 million for the six months ended June 30, 2025 as compared to a gain $1.2 million loss in the six months ended June 30, 2024. The change in foreign exchange loss in our Consolidated Statements of Operations and Comprehensive Income (Loss) mainly relates to short-term losses (offset by short-term gains) on sales denominated in currencies other than the functional currency of our operating entities. As described in Note 15, “Financial Instruments and Financial Risk”, we enter into monthly U.S. dollar-denominated foreign currency forward contracts to manage foreign currency exchange rate risk related to our international subsidiaries.
Current wording
Foreign exchange gain was $0.6 million for the nine months ended September 30, 2025 as compared to $2.2 million in the nine months ended September 30, 2024. The change in foreign exchange gain in our Consolidated Statements of Operations and Comprehensive Income mainly relates to short-term losses and gains on transactions denominated in currencies other than the functional currency of our operating entities. As described in Note 15, “Financial Instruments and Financial Risk” to our consolidated financial statements, we enter into monthly U.S. dollar-denominated foreign currency forward contracts to manage foreign currency exchange rate risk related to our international subsidiaries.
Previous wording
Provision for income taxes for the six months ended June 30, 2025 differed from the federal statutory rate primarily due to the valuation allowance attributable to the limitation on the deductibility of interest expense, the impact of the foreign rate differential and current year permanent tax differences, partially offset by a benefit for state income taxes. Income tax expense for thesix months ended June 30, 2024 differed from the statutory rate primarily due to the valuation allowance attributable to the limitation on the deductibility of interest expense and the impact of the foreign rate differential, partially offset by a benefit for state income taxes.
Current wording
Provision for income taxes for the nine months ended September 30, 2025 differed from the statutory rate due to recognition of the cumulative tax effects of the change in U.S. income tax laws under the OBBBA in the period of enactment associated with the accounting for the valuation allowance attributable to the limitation on the deductibility of interest expense. This was offset by the tax effects for a change in our indefinite reinvestment assertion with respect to a portion of our foreign earnings, the impact of the foreign rate differential and an increase in current year permanent tax differences. Provision for income taxes for the nine months ended September 30, 2024 differed from the statutory rate primarily due to a net increase in the valuation allowance attributable to the limitation on the deductibility of interest expense, the foreign rate differential and GILTI, partially offset by a benefit for state income taxes.
Previous wording
Net loss for the six months ended June 30, 2025 was $5.3 million, as compared to net income of $15.1 million for the six months ended June 30, 2024 due to the factors described above. Adjusted Net Income was $95.1 million for the six months ended June 30, 2025, as compared to $90.8 million for the six months ended June 30, 2024, and Adjusted EBITDA was $272.6 million for the six months ended June 30, 2025, as compared to $249.3 million for the six months ended June 30, 2024. Please see “Non-GAAP Financial Measures” below for a reconciliation of Adjusted Net Income and Adjusted EBITDA to their most directly comparable financial measure calculated and presented in accordance with GAAP.
Current wording
Net income for the nine months ended September 30, 2025 was $43.1 million, as compared to net income of $32.1 million for the nine months ended September 30, 2024 due to the factors described above. Adjusted Net Income was $170.4 million for the nine months ended September 30, 2025, as compared to $139.8 million for the nine months ended September 30, 2024. Adjusted EBITDA was $436.8 million for the nine months ended September 30, 2025, as compared to $395.6 million for the nine months ended September 30, 2024. Please see “Non-GAAP Financial Measures” below for a reconciliation of Adjusted Net Income and Adjusted EBITDA to their most directly comparable financial measure calculated and presented in accordance with GAAP.
Previous wording
We have three reportable segments: Sterigenics, Nordion and Nelson Labs. Our chief operating decision-maker evaluates performance and allocates resources within our business based on segment income, which excludes certain items which are included in income before income taxes as determined in our Consolidated Statements of Operations and Comprehensive Income (Loss). The accounting policies for our reportable segments are the same as those for the consolidated Company.
Current wording
We have three reportable segments: Sterigenics, Nordion and Nelson Labs. Our CODM evaluates performance and allocates resources within our business based on Segment Income, which excludes certain items which are included in income before tax as determined in our Consolidated Statements of Operations and Comprehensive Income. The accounting policies for our reportable segments are the same as those for the consolidated Company.
Previous wording
Our Nordion business is a leading global provider of Co-60 used in the sterilization and irradiation processes for the medical device, pharmaceutical, food safety, and high-performance materials industries, as well as in the treatment of cancer. In addition, Nordion is a leading global provider of gamma irradiation systems.
Current wording
Nordion is a leading global provider of Co-60 used in the sterilization and irradiation processes for the medical device, pharmaceutical, food safety, and high-performance materials industries, as well as in the treatment of cancer. In addition, Nordion is a leading global provider of gamma irradiation systems.
Previous wording
As a result of the time required to meet regulatory and logistics requirements for delivery of radioactive products, combined with accommodations that we make to our customers to minimize disruptions to their operations during the installation of Co-60, Nordion sales patterns can often vary significantly from one quarter to the next. In most cases, however, timing-related impacts on our sales performance tend to be resolved within several quarters, resulting in more consistent performance over longer periods of time. In addition, sales of gamma irradiation systems occur infrequently and tend to be for larger amounts. Nordion’s results of operations are also impacted by Co-60 harvest schedules.
Current wording
As a result of the time required to meet regulatory and logistics requirements for delivery of radioactive products, combined with accommodations made to our customers to minimize disruptions to their operations during the installation of Co-60, Nordion sales patterns can often vary significantly from one quarter to the next. However, timing-related impacts on our sales performance tend to be resolved within several quarters, resulting in more consistent performance over longer periods of time. In addition, sales of gamma irradiation systems occur infrequently and tend to be for larger amounts.
Previous wording
Our Nelson Labs business provides outsourced microbiological and analytical chemistry testing and advisory services for the medical device and pharmaceutical industries.
Current wording
Nelson Labs provides outsourced microbiological and analytical chemistry testing and advisory services for the medical device and pharmaceutical industries.
Previous wording
Nelson Labs net revenues were $57.1 million for the three months ended June 30, 2025, a decrease of $1.9 million, or 3.3%, as compared to the three months ended June 30, 2024. Growth in core lab testing services, favorable pricing and changes in foreign currency exchange rates were offset by a decline in expert advisory services revenue.
Current wording
Nelson Labs net revenues were $55.7 million for the three months ended September 30, 2025, a decrease of $2.9 million, or 5.0%, as compared to the three months ended September 30, 2024. Favorable pricing, a benefit from changes in foreign currency exchange rates and growth in core lab testing service were offset by a decline in expert advisory services revenue.
Previous wording
Sterigenics segment income was $107.7 million for the three months ended June 30, 2025, an increase of $11.0 million, or 11.3%, as compared to the three months ended June 30, 2024. The increase in segment income was primarily a result of higher volume and changes in mix as well as favorable customer pricing, partially offset by inflation.
Current wording
Sterigenics segment income was $107.2 million for the three months ended September 30, 2025, an increase of $11.2 million, or 11.6%, as compared to the three months ended September 30, 2024. The increase in segment income and segment income margin was primarily a result of an increase in volume and mix coupled with favorable customer pricing, partially offset by inflation.
Previous wording
Nelson Labs segment income was $19.5 million for the three months ended June 30, 2025, an increase of $2.4 million, or 13.9%, as compared to the three months ended June 30, 2024. Segment income and segment income margin increased as a result of volume/mix improvements, lab optimization and favorable pricing.
Current wording
Nelson Labs segment income was $19.0 million for the three months ended September 30, 2025, an increase of $0.3 million, or 1.9%, as compared to the three months ended September 30, 2024. Segment income and segment income margin increased as a result of volume and mix improvements, lab optimization and favorable pricing.
Previous wording
Segment Results for the Six Months Ended June 30, 2025 and 2024
Current wording
Segment Results for the Nine Months Ended September 30, 2025 and 2024
Previous wording
The following tables compare segment net revenue and segment income for the six months ended June 30, 2025 to the six months ended June 30, 2024:
Current wording
The following tables compare segment net revenue and segment income for the nine months ended September 30, 2025 to the nine months ended September 30, 2024:
Previous wording
Sterigenics net revenues were $194.8 million for the three months ended June 30, 2025, an increase of $18.5 million, or 10.5%, as compared to the three months ended June 30, 2024. The increase reflects improvements in volume and mix of 6.0% as well as favorable impacts from pricing and changes in foreign currency exchanges rates of 4.0% and 0.5%, respectively.
Current wording
Sterigenics net revenues were $557.4 million for the nine months ended September 30, 2025, an increase of $38.9 million, or 7.5%, as compared to the nine months ended September 30, 2024. The increase was mainly attributable to favorable impacts from pricing and volume and mix of 4.0% and 3.5%, respectively.
Previous wording
Nelson Labs net revenues were $109.4 million for the six months ended June 30, 2025, a decrease of $7.3 million, or 6.3%, as compared to the six months ended June 30, 2024. Growth in core lab testing services and favorable pricing were offset by a decline in expert advisory services revenue.
Current wording
Nelson Labs net revenues were $165.0 million for the nine months ended September 30, 2025, a decrease of $10.2 million, or 5.8%, as compared to the nine months ended September 30, 2024. Growth in core lab testing services, favorable pricing and abenefit from changes in foreign currency exchange rates were offset by a decline in expert advisory services revenue.
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Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Net Income, Adjusted Net Income and Adjusted EBITDA
Current report — wording carried from elsewhere
Senior Secured Credit Facilities and Indenture
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
On July 23, 2025, the Company agreed to resolve 129 pending and threatened EO claims in the State of Illinois. Pursuant to the terms of the July Term Sheet, which is subject to the satisfaction of several conditions, the Company agreed to pay $34.0 million to settle the claims.
Previous report — wording carried elsewhere
Loss on refinancing of debt for the six months ended June 30, 2025 was $0.1 million related to Amendment No. 5 to the Revolving Credit Facility. Loss on refinancing of debt for the six months ended June 30, 2024 was $24.1 million and occurred in connection with the refinancing our of our capital structure in May 2024. The refinancing activity resulted in the write off of certain unamortized debt issuance costs and discounts on the Term Loans due 2026. In addition, certain new debt issuance costs and discounts were expensed upon the issuance of the Term Loan and Secured Notes due 2031.