Company Achieves 8% Revenue Growth, Reiterates
FY 2024 Guidance
MADISON,
Wis., Nov. 7, 2023 /PRNewswire/ -- Accuray
Incorporated (NASDAQ: ARAY) today reported financial results for
the first quarter of fiscal 2024 ended September 30, 2023.
First Quarter Fiscal 2024 Summary
- Net revenue of $103.9 million
increased 7.7 percent from the same period in the prior fiscal
year. Net revenue on a constant currency basis was $102.7 million, which represents a 6.5 percent
increase from the same period in the prior fiscal year.
- GAAP net loss of $3.0 million, as
compared to GAAP net loss of $5.4
million in the same period in the prior fiscal year.
Adjusted EBITDA of $6.5 million, as
compared to adjusted EBITDA of $1.9
million in the same period in the prior fiscal year.
- Gross orders of $63.7 million
representing a book to bill ratio of 1.2.
Other Recent Operational Highlights
- FDA 510(k) clearance in the U.S. and CE mark in the EU market
for the VitalHold™* breast cancer treatment package for the
Radixact® System
- China National Medical Products Association approval for
Tomo® C, Accuray's China joint venture product for the Type B
market
- Showcased new product innovations including Cenos™, online
adaptive therapy option**, for the Radixact System at the American
Society for Radiation Oncology (ASTRO) annual meeting
- Completed transition to a new enterprise resource planning
("ERP") system
"We delivered another strong quarter of revenue growth and
margin expansion with successful execution against our strategic
growth agenda," said Suzanne Winter,
Chief Executive Officer. "I am very pleased with our strong start
to the fiscal year, which includes key new product introductions
and regulatory milestones that I believe will be the catalysts for
increased use and adoption of our technology. We remain committed
to providing medical care teams with innovative products and
services that deliver value and close gaps in access to advanced
radiotherapy treatments."
Fiscal First Quarter Results
Total net revenue in the first quarter of fiscal 2024 was
$103.9 million, compared to
$96.5 million in the prior fiscal
year first quarter. Product revenue in the first quarter of fiscal
2024 was $53.4 million, compared to
$44.6 million in the prior fiscal
year first quarter. Service revenue in the first quarter of fiscal
2024 was $50.5 million, compared to
$51.9 million in the prior fiscal
year first quarter.
Total gross profit in the first quarter of fiscal 2024 was
$39.5 million, or 38.0 percent of
total net revenue, compared to total gross profit of $34.6 million, or 35.9 percent of total net
revenue, in the prior fiscal year first quarter.
Operating expenses in the first quarter of fiscal 2024 were
$37.3 million, compared to
$36.8 million in the prior fiscal
year first quarter.
Net loss in the first quarter of fiscal 2024 was $3.0 million, or $0.03 per share, compared to a net loss of
$5.4 million, or $0.06 per share, in the prior fiscal year first
quarter. Adjusted EBITDA in the first quarter of fiscal 2024 was
$6.5 million, compared to
$1.9 million in the prior fiscal year
first quarter.
Gross product orders in the first quarter of fiscal 2024 totaled
$63.7 million compared to
$69.8 million in the prior fiscal
year first quarter. Order backlog as of September 30, 2023 was $489.0 million, approximately 9.2 percent lower
than at the end of the prior fiscal year first quarter.
Cash, cash equivalents, and short-term restricted cash were
$77.4 million as of September 30, 2023, a decrease of $12.5 million from June
30, 2023.
Fiscal Year 2024 Financial Guidance
Accuray's financial guidance is based on current expectations.
The following statements are forward-looking and actual results
could differ materially depending on market and economic
conditions, supply chain disruption, and the factors set forth
under "Safe Harbor Statement" below.
The company is reaffirming guidance for fiscal year 2024 as
follows:
- Total revenue is expected in the range of $460 million to $470
million, representing a year-over-year growth range of 3 to
5 percent.
- Adjusted EBITDA for fiscal year 2024 is expected in the range
of $27 million to $30 million.
Guidance for non-GAAP financial measures excludes depreciation
and amortization, stock-based compensation, interest expense,
provision for income taxes, and ERP and ERP related expenditures.
For more information regarding the non-GAAP financial measures
discussed in this press release, please see "Use of Non-GAAP
Financial Measures" below.
Conference Call Information
Accuray will host a conference call beginning at 1:30 p.m. PT/4:30 p.m.
ET today to discuss results for the first quarter of fiscal
2024 as well as recent corporate developments. Conference call
dial-in information is as follows:
- U.S. callers: (833) 316-0563
- International callers: (412) 317-5747
Individuals interested in listening to the live conference call
via the Internet may do so by logging on to the Investor Relations
section of Accuray's website, www.accuray.com. There will be a
slide presentation accompanying today's event which can also be
accessed on the company's Investor Relations page at
www.accuray.com.
In addition, a taped replay of the conference call will be
available beginning approximately one hour after the call's
conclusion and will be available for seven days. The replay number
is (877) 344-7529 (USA), or (412)
317-0088 (International), Conference ID: 7621845. An archived
webcast will also be available on Accuray's website until Accuray
announces its results for the second quarter of fiscal 2024.
Use of Non-GAAP Financial Measures
Accuray reports its financial results in accordance with
generally accepted accounting principles in the United States ("GAAP") and the rules of
the SEC. To supplement its financial statements prepared and
presented in accordance with GAAP, Accuray uses certain non-GAAP
financial measures, such as adjusted EBITDA, and net revenue on a
constant currency basis.
Accuray has supplemented its GAAP net income (loss) with a
non-GAAP measure of adjusted earnings before interest, taxes, ERP
and ERP related expenditures, depreciation, amortization and
stock-based compensation ("adjusted EBITDA"). The calculation of
adjusted EBITDA also excludes certain non-recurring, irregular and
one-time items. Management believes that this non-GAAP financial
measure provides useful supplemental information to management and
investors regarding the performance of the company and facilitates
a meaningful comparison of results for current periods with
previous operating results. A reconciliation of GAAP net income
(loss) (the most directly comparable GAAP measure) to non-GAAP
adjusted EBITDA is provided in the schedules below.
Accuray has also reported certain operating results on a
constant currency basis in order to facilitate period-to-period
comparisons of its results without regard to the impact of foreign
currency exchange rate fluctuations. Management believes disclosure
of non-GAAP constant currency results is helpful to investors
because it facilitates period-to-period comparisons of the
company's results by increasing the transparency of the underlying
performance by excluding the impact of foreign currency exchange
rate fluctuations. The GAAP measure most directly comparable to net
revenue on a constant currency basis is revenue. Accuray calculates
the constant currency amounts by translating local currency amounts
in the current period using the same foreign translation rate used
in the prior period being compared against rather than the actual
exchange rate in effect during the current period.
There are limitations in using these non-GAAP financial measures
because they are not prepared in accordance with GAAP and may be
different from non-GAAP financial measures used by other companies.
These non-GAAP financial measures should not be considered in
isolation or as a substitute for GAAP financial measures. Investors
and potential investors should consider non-GAAP financial measures
only in conjunction with the company's consolidated financial
statements prepared in accordance with GAAP.
About Accuray
Accuray Incorporated (Nasdaq: ARAY) is committed to expanding
the powerful potential of radiation therapy to improve as many
lives as possible. We invent unique, market-changing solutions that
are designed to deliver radiation treatments for even the most
complex cases—while making commonly treatable cases even easier—to
meet the full spectrum of patient needs. We are dedicated to
continuous innovation in radiation therapy for oncology,
neuro-radiosurgery, and beyond, as we partner with clinicians and
administrators, empowering them to help patients get back to their
lives, faster. Accuray is headquartered in Madison, Wisconsin, with facilities
worldwide.
Safe Harbor Statement
Statements made in this press release that are not statements of
historical fact are forward-looking statements and are subject to
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements in this press
release relate, but are not limited, to the company's future
results of operations, including expectations regarding: total
revenue and adjusted EBITDA; the effect of the global economic
environment and the COVID-19 pandemic on the company and the market
in general, including with respect to the company's ability to
navigate supply chain, logistics, macroeconomic, and foreign
exchange challenges; delivering on the company's strategic growth
plan, progressing against long-term strategic goals, and continuing
adoption of its technologies; the company's ability to execute on
margin and profitability expansion initiatives; expectations
regarding commercial strategy and execution as well as growth
opportunities; expectations regarding the market in China, the company's China joint venture and the Tomo-C product as
well as expectations with respect to other strategic partnerships,
including expected timing of regulatory clearances; expectations
related to the markets in which the company operates; expectations
regarding new product introductions and innovations and their
effect on use and adoption of the company's products as well as
revenue growth and EBITDA expansion; expectations with respect to
the company's cost savings initiatives, including its reduction in
global workforce and any related costs; expectations regarding
backlog; and the company's ability to continue to build a stronger
business and make investments that deliver value to customers and
shareholders as well as advance patient care and close gaps in
access to advanced radiotherapy treatments. These forward-looking
statements involve risks and uncertainties. If any of these risk or
uncertainties materialize, or if any of the company's assumptions
prove incorrect, actual results could differ materially from the
results express or implied by these forward-looking statements.
These risks and uncertainties include, but are not limited to, the
effect of the global macroeconomic environment on the operations of
the company and those of its customers and suppliers; disruptions
to our supply chain, including increased logistics costs; the
company's ability to achieve widespread market acceptance of its
products; the company's ability to realize the expected benefits of
the China joint venture and other
partnerships; risks inherent in international operations; the
company's ability to maintain or increase its gross margins on
product sales and services; delays in regulatory approvals or the
development or release of new offerings; the company's ability to
meet the covenants under its credit facilities; the company's
ability to convert backlog to revenue; and such other risks
identified under the heading "Risk Factors" in the company's Annual
Report on Form 10-K, filed with the Securities and Exchange
Commission (the "SEC") on September 7,
2023 and as updated periodically with the company's other
filings with the SEC.
Forward-looking statements speak only as of the date the
statements are made and are based on information available to the
company at the time those statements are made and/or management's
good faith belief as of that time with respect to future events.
The company assumes no obligation to update forward-looking
statements to reflect actual performance or results, changes in
assumptions or changes in other factors affecting forward-looking
information, except to the extent required by applicable securities
laws. Accordingly, investors should not put undue reliance on any
forward-looking statements.
* VitalHold™ availability is subject to regulatory
clearance or approval in some markets
** Cenos is 510(k) pending. The solution is not available for sale
in the USA. It is not CE marked
and availability is subject to regulatory clearance or approval in
some markets.
Aman Patel,
CFA
|
Beth Kaplan
|
Investor Relations,
ICR-Westwicke
|
Public Relations
Director, Accuray
|
+1 (443)
450-4191
|
+1 (408)
789-4426
|
aman.patel@westwicke.com
|
bkaplan@accuray.com
|
Financial Tables to Follow
Accuray
Incorporated
Condensed
Consolidated Statements of Operations
(in thousands, except
per share data)
(Unaudited)
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
|
|
2023
|
|
|
2022
|
|
Net revenue:
|
|
|
|
|
|
|
Products
|
|
$
|
53,350
|
|
|
$
|
44,623
|
|
Services
|
|
|
50,542
|
|
|
|
51,870
|
|
Total net
revenue
|
|
|
103,892
|
|
|
|
96,493
|
|
Cost of
revenue:
|
|
|
|
|
|
|
Cost of
products
|
|
|
35,699
|
|
|
|
28,850
|
|
Cost of
services
|
|
|
28,700
|
|
|
|
33,046
|
|
Total cost of
revenue
|
|
|
64,399
|
|
|
|
61,896
|
|
Gross profit
|
|
|
39,493
|
|
|
|
34,597
|
|
Operating
expenses:
|
|
|
|
|
|
|
Research and
development
|
|
|
14,013
|
|
|
|
14,092
|
|
Selling and
marketing
|
|
|
10,244
|
|
|
|
10,795
|
|
General and
administrative
|
|
|
13,023
|
|
|
|
11,892
|
|
Total operating
expenses
|
|
|
37,280
|
|
|
|
36,779
|
|
Income (loss) from
operations
|
|
|
2,213
|
|
|
|
(2,182)
|
|
Income (loss) from
equity method investment, net
|
|
|
431
|
|
|
|
(368)
|
|
Other expense,
net
|
|
|
(3,681)
|
|
|
|
(2,558)
|
|
Loss before provision
for income taxes
|
|
|
(1,037)
|
|
|
|
(5,108)
|
|
Provision for income
taxes
|
|
|
1,932
|
|
|
|
341
|
|
Net loss
|
|
$
|
(2,969)
|
|
|
$
|
(5,449)
|
|
Net loss per share -
basic and diluted
|
|
$
|
(0.03)
|
|
|
$
|
(0.06)
|
|
Weighted average common
shares used in computing loss per share:
|
|
|
|
|
|
|
Basic and
diluted
|
|
|
96,555
|
|
|
|
93,529
|
|
Accuray
Incorporated
Condensed
Consolidated Balance Sheets
(in
thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
June
30,
|
|
|
|
2023
|
|
|
2023
|
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
76,918
|
|
|
$
|
89,402
|
|
Restricted
cash
|
|
|
524
|
|
|
|
524
|
|
Accounts receivable,
net
|
|
|
77,370
|
|
|
|
74,777
|
|
Inventories
|
|
|
149,977
|
|
|
|
145,150
|
|
Prepaid expenses and
other current assets
|
|
|
28,798
|
|
|
|
27,612
|
|
Deferred cost of
revenue
|
|
|
560
|
|
|
|
568
|
|
Total current
assets
|
|
|
334,147
|
|
|
|
338,033
|
|
Property and equipment,
net
|
|
|
24,963
|
|
|
|
20,926
|
|
Investment in joint
venture
|
|
|
13,121
|
|
|
|
15,128
|
|
Operating lease
right-of-use assets, net
|
|
|
24,378
|
|
|
|
25,853
|
|
Goodwill
|
|
|
57,656
|
|
|
|
57,681
|
|
Intangible assets,
net
|
|
|
163
|
|
|
|
210
|
|
Long-term restricted
cash
|
|
|
1,249
|
|
|
|
1,276
|
|
Other assets
|
|
|
21,153
|
|
|
|
20,107
|
|
Total
assets
|
|
$
|
476,830
|
|
|
$
|
479,214
|
|
Liabilities and
equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
34,877
|
|
|
$
|
33,739
|
|
Accrued
compensation
|
|
|
26,496
|
|
|
|
23,793
|
|
Operating lease
liabilities, current
|
|
|
6,077
|
|
|
|
4,151
|
|
Other accrued
liabilities
|
|
|
36,634
|
|
|
|
38,271
|
|
Customer
advances
|
|
|
19,372
|
|
|
|
20,777
|
|
Deferred
revenue
|
|
|
71,764
|
|
|
|
72,185
|
|
Short-term
debt
|
|
|
6,229
|
|
|
|
5,721
|
|
Total current
liabilities
|
|
|
201,449
|
|
|
|
198,637
|
|
Operating lease
liabilities, non-current
|
|
|
22,806
|
|
|
|
23,602
|
|
Long-term other
liabilities
|
|
|
4,900
|
|
|
|
4,675
|
|
Deferred revenue,
non-current
|
|
|
26,939
|
|
|
|
27,079
|
|
Long-term
debt
|
|
|
169,792
|
|
|
|
171,562
|
|
Total
liabilities
|
|
|
425,886
|
|
|
|
425,555
|
|
Equity:
|
|
|
|
|
|
|
Common
stock
|
|
|
97
|
|
|
|
97
|
|
Additional paid-in
capital
|
|
|
557,668
|
|
|
|
555,276
|
|
Accumulated other
comprehensive income (loss)
|
|
|
(1,716)
|
|
|
|
422
|
|
Accumulated
deficit
|
|
|
(505,105)
|
|
|
|
(502,136)
|
|
Total
equity
|
|
|
50,944
|
|
|
|
53,659
|
|
Total liabilities and
equity
|
|
$
|
476,830
|
|
|
$
|
479,214
|
|
Accuray
Incorporated
Summary of Orders
and Backlog
(in thousands, except
book to bill ratio)
(Unaudited)
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
|
|
2023
|
|
|
2022
|
|
Gross Orders
|
|
$
|
63,734
|
|
|
$
|
69,848
|
|
Net Orders
|
|
|
31,740
|
|
|
|
19,571
|
|
Order
Backlog
|
|
|
489,031
|
|
|
|
538,447
|
|
Book to bill ratio
(a)
|
|
|
1.2
|
|
|
|
1.6
|
|
(a) Book to bill ratio
is defined as gross orders for the period divided by product
revenue for the period
|
Accuray
Incorporated
Reconciliation of
GAAP Net Income (Loss) to Adjusted Earnings Before Interest, Taxes,
Depreciation,
Amortization and
Stock-Based Compensation (Adjusted EBITDA)
(in
thousands)
(Unaudited)
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
|
|
2023
|
|
|
2022
|
|
GAAP net
loss
|
|
$
|
(2,969)
|
|
|
$
|
(5,449)
|
|
Depreciation and
amortization (a)
|
|
|
1,251
|
|
|
|
1,176
|
|
Stock-based
compensation
|
|
|
2,392
|
|
|
|
2,916
|
|
Interest expense, net
(b)
|
|
|
2,628
|
|
|
|
2,256
|
|
Provision for income
taxes
|
|
|
1,932
|
|
|
|
341
|
|
ERP and ERP related
expenditures
|
|
|
1,270
|
|
|
|
655
|
|
Adjusted
EBITDA
|
|
$
|
6,504
|
|
|
$
|
1,895
|
|
(a) consists of
depreciation, primarily on property and equipment as well as
amortization of intangibles.
|
(b) consists primarily
of interest expense associated with outstanding debt.
|
Accuray
Incorporated
Forward-Looking
Guidance
Reconciliation of
Projected Net Income (Loss) to Projected Adjusted Earnings Before
Interest, Taxes, Depreciation, Amortization and Stock-Based
Compensation (Adjusted EBITDA)
(in
thousands)
(Unaudited)
|
|
|
|
|
|
|
Twelve Months
Ending
June 30, 2024
|
|
|
|
From
|
|
|
To
|
|
GAAP net income
(loss)
|
|
$
|
(1,000)
|
|
|
$
|
2,000
|
|
Depreciation and
amortization (a)
|
|
|
4,500
|
|
|
|
4,500
|
|
Stock-based
compensation
|
|
|
10,500
|
|
|
|
10,500
|
|
Interest expense, net
(b)
|
|
|
10,000
|
|
|
|
10,000
|
|
Provision for income
taxes
|
|
|
2,000
|
|
|
|
2,000
|
|
ERP and ERP related
expenditures
|
|
|
1,000
|
|
|
|
1,000
|
|
Adjusted
EBITDA
|
|
$
|
27,000
|
|
|
$
|
30,000
|
|
(a) consists of
depreciation, primarily on property and equipment as well as
amortization of intangibles.
|
(b) consists primarily
of interest expense associated with outstanding debt.
|
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SOURCE Accuray Incorporated