Sotera Health Reports First-Quarter 2025 Results

Sotera Health Company, a leading global provider of mission-critical end-to-end sterilization solutions, lab testing, and advisory services for the healthcare industry, has released its financial results for the first quarter of 2025. The company reported a modest increase in net revenues and a net loss for the quarter, influenced by a significant settlement related to ethylene oxide (EO) claims.

Financial Highlights

For the first quarter of 2025, Sotera Health reported net revenues of $255 million, a 2.6% increase compared to the same period in 2024. On a constant currency basis, net revenues increased by 4.4%. The company experienced a net loss of $13 million, or $0.05 per diluted share, compared to a net income of $6 million, or $0.02 per diluted share, in the first quarter of 2024. This loss includes a $31 million settlement related to EO claims against Sterigenics.

Adjusted EBITDA for the quarter increased by 8.8% to $122 million, or 11.2% on a constant currency basis. Adjusted EPS was $0.14, up from $0.13 in the first quarter of 2024.

Business and Operational Highlights

Segment-wise, Sterigenics reported net revenues of $170 million, a 1.9% increase from the previous year, driven by favorable pricing. Nordion saw a significant 35.6% increase in net revenues to $33 million, primarily due to volume and mix. Nelson Labs, however, experienced a 9.3% decrease in net revenues to $52 million, attributed to a decline in expert advisory service revenue.

Strategic Initiatives and Corporate Developments

As of March 31, 2025, Sotera Health had $2.3 billion in total debt and $304 million in cash and cash equivalents. The company improved its Net Leverage Ratio to 3.6x from 3.7x at the end of 2024. Additionally, on April 30, 2025, the company amended its revolving credit facility, increasing its size by $176 million to a total of $600 million and extending its maturity date to April 2030.

Management's Perspective

Michael B. Petras, Jr., Chairman and CEO, expressed satisfaction with the company's performance, highlighting mid-single-digit revenue growth and strong double-digit Adjusted EBITDA growth on a constant currency basis. He reaffirmed the company's 2025 outlook, emphasizing the team's commitment to their mission of safeguarding global health.

Future Outlook

Sotera Health reaffirmed its full-year 2025 outlook, projecting net revenues growth of 4.0% to 6.0% and Adjusted EBITDA growth of 4.5% to 6.5%, both on a constant currency basis. The company also updated its foreign currency assumptions, expecting a 1.25% headwind to net revenues and a 1.50% headwind to Adjusted EBITDA based on average March 2025 exchange rates.

SEC Filing: Sotera Health Co [ SHC ] - 8-K - May. 01, 2025