BAIRD 2026 GLOBAL INDUSTRIAL CONFERENCE - MIRION TECHNOLOGIES INC

Explicit Guidance:

• Paragon (Nuclear & Safety segment): Guided for 25% organic growth in the current year (following 20% organic growth in the prior year).
• RTQA (Medical segment): Targeting high single-digit organic revenue growth for the full year; Q3 orders grew >20% but revenue is catching up.
• Margins: No specific percentage target provided; management has withdrawn the prior 30% EBITDA margin target for 2028. Current trajectory is approximately 1% annual margin accretion (consistent with historical IPO-era performance), with potential for acceleration due to operating leverage and AI efficiencies. Sharper forward guidance on margins expected in early 2027.
• OPEX: AI and Cybersecurity spending expected to reach ~$10 million in OPEX for the current year.

Business-Segment Outlook:

• Nuclear & Safety (Installed Base): Anticipate a decade or more of strong capital spending growth driven by life extensions, power upgrades, and digital modernization; the "binary gateway" of permitting activity has been passed, signaling sustained demand regardless of data center build-out rates.
• Nuclear & Safety (New Builds):
  • Large-scale: Expect acceleration in new large-scale nuclear construction globally over the medium term due to energy security concerns, though no new builds are anticipated in the U.S. within the intermediate planning horizon. Specific upcoming projects include a large order in Egypt (two new reactors) and a potential incipient order in France (six EPR reactors, pending EU approval).
  • Small Modular Reactors (SMR): Revenue share is expected to grow from ~4% currently; management views the sector as emerging with high capital deployment urgency by leading players to prove first-of-a-kind reactors.
• Medical (RTQA): Expect normalization in the U.S. healthcare market; China market is stabilizing; Japan remains a drag. Growth tailwinds anticipated from Siemens Healthineers' new NextGen Linear Accelerator launch (replacing legacy QA software with Mirion's).
• Medical (Nuclear Medicine): Anticipate a return to growth in the coming quarters following a six-to-12-month destocking period. Growth drivers include the expansion of the drug pipeline from 100 to 1,000+ candidates in the FDA pipeline (theranostics) and a shift from beta to alpha emitters.
• Medical (Software & Services): Software business currently growing in the double digits; AI adoption is expected to accelerate product release cycles.
• Labs & Research: Expects to transition from headwinds (government shutdowns) to low-to-mid single-digit growth, driven by long-term waste remediation needs and nuclear arsenal modernization safety instrumentation.

Market and Competitive Outlook:

• Commercial Nuclear Power: 80% of revenue is tied to the installed base (roughly 450 reactors, 98% global fleet presence), creating a durable, high-barrier competitive moat.
• Product Mix Shift: Demand will be concentrated in core instrumentation (neutron measurement, radiation monitoring, reactor protection systems) for power output, followed by "health physics" (dosimeters, contamination monitors) and "balance of plant" upgrades (lab instruments, cameras, security systems).
• Competitive Positioning: Mirion holds the global number one position in 20 of 22 product categories sold into nuclear power; incumbency is described as "highly defendable."
• SMR Landscape: Mirion positions itself as an enabler across the SMR sector rather than a bet on individual players, leveraging alpha spectroscopy technology for the industry shift to alpha-emitter drugs.

Macro / Industry Outlook:

• Energy Demand: Global energy balance is shifting toward nuclear power due to a profound shortage of electrical generating capacity and energy security concerns exacerbated by geopolitical tensions (e.g., war in Ukraine, Straits of Hormuz).
• Regulatory/Political: Strong bipartisan support expected for legacy nuclear waste remediation in the U.S.; permitting activity for plant life extensions is a key independent driver of demand, decoupled from political cycles.
• Geopolitics: Global new-build activity is being driven by national security imperatives rather than purely market economics.

Strategic Initiatives:

• M&A Integration (Paragon): The acquisition (completed <1 year ago) is delivering strong commercial synergies and is margin accretive overall. However, a nascent reactor protection system product line is front-end loaded, expected to be dilutive to margins until 2028 before becoming accretive.
• AI & Cybersecurity: Significant investments being made to counter rising cyber risks associated with AI capabilities ($10M OPEX this year); these investments are expected to drive future operational efficiency and margin expansion.
• R&D/Product Development: Expansion into upstream drug maker software solutions to capture spend earlier in the theranostic cycle; development of reactor protection systems leveraging Paragon's asset base.

Risks and Headwinds to Outlook:

• Margin Dilution: Near-term margin pressure expected due to heavy investment in the new reactor protection product line (via Paragon) and high OPEX for AI/Cyber initiatives, delaying full margin accretion from these initiatives past 2028.
• Macro/Geopolitical: Potential delays in EU approval for the French EPR project; uncertainty in Japan's RTQA market.
• Execution Risk: The SMR sector carries inherent technological, commercial, and regulatory risks, though Mirion mitigates this by partnering with multiple capital-rich players.
• Customer Concentration: Heavy reliance on the installed base (80% of nuclear revenue) means new build slowdowns (e.g., U.S. delays) have limited impact, but the strategy relies heavily on sustained capital commitment for life extensions.

Management Tone on the Future:

• Confidence: High confidence in the durability of the nuclear capital spending cycle ("decade or more," "bell has been rung").
• Strategic Shift: Explicitly pivoted away from rigid short-term margin targets (30% by 2028) to a more flexible, volume-and-efficiency-driven trajectory, prioritizing strategic investments (AI, Paragon integration) over immediate margin optimization.
• Sentiment: Described as "very constructive," "bullish," and "optimistic" regarding the medical theranostic space and the global acceleration of nuclear power.

Miscellaneous:

• Revenue Split: Nuclear and Safety represents ~70% of total revenue; Medical represents ~30%.
• Paragon Performance: Contributed to a 25% organic growth guidance for the segment this year, acting as a "canary in the coal mine" for broader catch-up capital spending.
• Theranostics Pricing: Cited individual treatment costs up to $250,000, highlighting the high-value nature of the expanding drug pipeline.
• Software Growth: Software has been growing double digits for the last two years and is growing faster than the underlying hardware business in the medical segment.