Accuray Inc. Announces Results for Fourth Quarter and Fiscal Year 2012

SUNNYVALE, Calif., Sept. 6, 2012 /PRNewswire/ -- Accuray Incorporated (Nasdaq: ARAY), the premier radiation oncology company, announced today financial results for the fourth quarter and fiscal year ended June 30, 2012. The fiscal 2012 financial data presented below reflects Accuray's consolidated results including the results for TomoTherapy Incorporated, which was acquired by Accuray in June 2011. Non-GAAP results are provided to enhance understanding of Accuray's ongoing core results of operations.

Highlights from the fourth quarter of fiscal 2012 include continued improvement in service margins, with a year-over-year decrease in sales and marketing, and general and administrative expenses and a 1.15 book-to-bill ratio.

"We have been investing heavily in research and development and plan to introduce two advanced technology platforms at the American Society for Radiation Oncology's (ASTRO) Annual Meeting in October 2012 which we expect to drive future orders and revenue growth," said Euan S. Thomson, Ph.D., president and chief executive officer of Accuray. "After the new product introductions we plan to reduce our research and development expenses to more normalized levels as seen historically. We believe we are on track to return to profitability (non-GAAP) on schedule, by the end of our current fiscal year, ending June 30, 2013."

For the fourth quarter of fiscal 2012, Accuray reported total consolidated GAAP revenue of $100.5 million and non-GAAP total revenue of $101.1 million. By comparison, for the fourth quarter of fiscal 2011, the sum of the revenue reported or recorded by Accuray and TomoTherapy as separate companies totaled $109.8 million on a pro forma basis. For the fiscal year ended June 30, 2012, GAAP revenue was $409.2 million and non-GAAP revenue was $401.3 million, a decrease from the pro forma total revenue of $409.7 million in the same period of the prior year. Excluding non-recurring revenue items and changes in accounting for TomoTherapy, non-GAAP revenues were essentially unchanged year-on-year. CyberKnife System revenues in fiscal 2012 were $37.6 million lower than in fiscal 2011 due to shipment schedules in the European region and a decline in new orders in the Americas region, offset partially by increases in our APAC and Japan regions. TomoTherapy Systems revenues in fiscal 2012 were $5.8 million higher than in fiscal 2011 on a pro-forma basis.

The consolidated GAAP gross margin for the fourth quarter of fiscal 2012 was 46.2 percent for products and 21.6 percent for services. The consolidated non-GAAP gross margin for the fourth quarter of fiscal 2012 was 52.8 percent for products. Non-GAAP service gross margins were 19.9 percent for the fourth quarter, up from (2.3 percent) in the fourth quarter of fiscal 2011 on a pro forma basis. Positive service gross margins were driven largely by a continued improvement in reliability and reduction of service costs for TomoTherapy Systems. We believe the company remains on track to achieve 20 to 22 percent service gross margins for the full fiscal year 2013 on a non-GAAP basis.

Consolidated GAAP net loss attributable to stockholders for the fourth quarter of fiscal 2012 was $20.3 million, or $0.28 per share. Non-GAAP net loss for the fourth quarter of fiscal 2012 was $14.2 million or $0.20 per share. By comparison, for the fourth quarter of fiscal 2011 the sum of the net losses reported or recorded by Accuray and TomoTherapy as separate companies totaled $8.5 million or $0.12 per share on a pro forma basis. For the fiscal year ended June 30, 2012, GAAP net loss was $72.0 million or $1.02 per share, compared to a pro-forma net loss of $30.5 million or $0.44 per share in prior fiscal year. For the fiscal year ended June 30, 2012, non-GAAP net loss was $41.6 million or $0.60 per share, compared to a pro-forma net loss of $30.5 million or $0.44 per share in the prior fiscal year.

Accuray added $74.2 million of net new system orders to backlog during the fourth quarter of fiscal 2012, increasing system backlog to $283.6 million. While performance was good internationally, the company continued to experience weakness in sales in the United States. The company expects to generate improved results during fiscal year 2013 from the introduction of new technology platforms and from enhanced performance of its realigned United States sales organization.

During the fourth quarter of fiscal 2012, 23 units were shipped and 15 were installed, increasing Accuray's worldwide installed base to 642 systems.

Accuray's cash, cash equivalents and restricted cash was $145 million as of June 30, 2012. Use of cash during the fourth quarter of fiscal 2012 was primarily due to changes in working capital.

Outlook
The following statement, among others in this release, is forward-looking and actual results may differ materially. We expect first quarter fiscal year 2013 revenue to be substantially below the first quarter of fiscal 2012, and revenues then to accelerate over the balance of the fiscal year. We expect this to be driven by two key factors: (1) potential shipment delays as customers wait for our next technology releases and (2) that we will not benefit from the significant backlog of TomoTherapy System orders we had at this time last year. For the full fiscal year 2013, Accuray expects that revenue will be in the range of $405 million to $425 million (non-GAAP), with the majority of revenue expected in the second half of fiscal year 2013. More details will be provided on the conference call.

Additional Information
Additional information including slides of fourth quarter highlights which will be discussed during the conference call is available in the Investor Relations section of the company's website at www.accuray.com/investors.

Earnings Call Open to Investors
Accuray will hold a conference call for financial analysts and investors on Thursday September 6, 2012 at 2:00 p.m. PDT/5:00 p.m. EDT. The conference call dial-in numbers are 1-800-295-4740 (USA) or 1-617-614-3925 (International), Conference ID: 89497327. A live webcast of the call will also be available from the Investor Relations section of the corporate website at www.accuray.com/investors. In addition, a recording of the call will be available by calling 1-888-286-8010 (USA) or 1-617-801-6888 (International), Conference ID: 79000863, beginning at 5:00 p.m. PDT/8:00 p.m. EDT on September 6, 2012 and will be available through September 13, 2012. A webcast replay will also be available from the Investor Relations section of the Company's website at www.accuray.com/investors from approximately 5:00 p.m. PDT/8:00 p.m. EDT today through Accuray's release of its results for the first quarter of fiscal 2013, ending September 30, 2012.

About Accuray
Accuray Incorporated (Nasdaq: ARAY), based in Sunnyvale, Calif., is the premier radiation oncology company that develops, manufactures and sells personalized, innovative treatment solutions that set the standard of care with the aim of helping patients live longer, better lives. The Company's leading-edge technologies the CyberKnife and TomoTherapy Systems are designed to deliver radiosurgery, stereotactic body radiation therapy, intensity modulated radiation therapy, image guided radiation therapy, and adaptive radiation therapy. To date, 642 systems have been installed in leading hospitals around the world. For more information, please visit www.accuray.com.

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