Nordion Earnings Call Nuggets: Buyback Rationale and Strategic Review
Nordion, Inc. (NYSE:NDZ) recently reported its third quarter earnings and discussed the following topics in its earnings conference call.
David Krempa – Morningstar: Can you talk about what your thought process was and why you didn’t do a buyback with the cash and why you’d rather let it sit? And then secondly, will any of the corporate expense go away with the sale of TheraSphere or should we plan on that staying the same?
Peter Dans – CFO: Thanks Dave. So, I’ll take those. So, again with the – looking at doing the buyback, we did look at a variety of options for returning cash to shareholders. And as Steve mentioned, we looked at the implications of that from a tax perspective and also, considered where we were at in terms of our strategic review and make – made a decision really based on those factors. In terms of the second question, from a corporate cost perspective, as we said last quarter, with the divesture of Targeted Therapies we wouldn’t see a reduction in G&A initially from that. We do plan following the completion of the transition services agreement to assess the requirements of the business at that point in time and take the appropriate actions to our adjust our cost structure.
Neil Maruoka – Canaccord Genuity: Do you anticipate a scenario where the strategic review could result in the use of cash through a purchase of assets or an acquisition of a business and is it fair to say that, any potential return of capital is pending the outcome of the strategic review?
Steve M. West – CEO: Good morning, Neil. I’ll take that one. So, I’m just going to reiterate a little bit what Peter said, and that we looked at what were the potential ways to return the net cash proceeds to shareholders and we look to overall implications for shareholders of those various methodologies, and we also looked to where we were in our strategic review and we came to a conclusion that at this current time, it was best to retain the cash on the balance sheet. In terms of other potential uses of that cash as your alluding to, we have no other plans for the allocation for the use of these cash proceeds at this time, and we will continue with our strategic review and make assessments during that process.
Neil Maruoka – Canaccord Genuity: And just as a follow-up. I will ask the same question I did last quarter. But after another three months of the strategic review, do you continue to believe there are multiple potential buyers out there for the Sterilization business?
Steve M. West – CEO: Well, we’re not talking about potential buyers and thank you for following up again on your previous question. But we have executed on our strategic review in terms of the sale of Targeted Therapies business and that was definitely part of the process. As for the remaining elements of the business and our two business units, plus our corporate overlay we’re going to look at all the options and we’re continuing to do that. And when we have something that we can discuss more publicly, we will do so. But at this moment in time, we’re really not in a position to make any further comment.