SUNNYVALE, Calif., Aug. 13, 2020 /PRNewswire/ -- Accuray
Incorporated (NASDAQ: ARAY) today reported financial results for
the fourth quarter and fiscal year ended June 30, 2020.
Q4 Fiscal 2020 and Recent Operating Highlights
- Gross orders of $94.3 million,
including 8 orders from China
- Net revenue of $95.0 million, net
loss of $0.8 million, Adjusted EBITDA
of $9.3 million
- Generated $19.2 million of
operating cash flow and ended the quarter with $108.6 million of cash and short-term restricted
cash
- Shipped nine Synchrony upgrades
Fiscal Year 2020 Highlights
- Gross orders increased 10 percent to $377.3 million versus prior fiscal year
- Ending backlog of $602.7 million,
an increase of 22 percent from June 30,
2019
- Robust demand for Synchrony on Radixact: 56 global orders and
16 total shipments since commercial release
- Net revenue of $382.9 million,
net income of $3.2 million, Adjusted
EBITDA grew to $26.8 million from
$23.7 million in prior fiscal
year
- GAAP operating income grew to $11.9
million from $0.6 million in
prior fiscal year
"Despite the circumstances and the uncertainties associated with
the COVID-19 pandemic, we finished fiscal 2020 with a solid
performance and grew our gross orders by 10 percent year over
year," said Josh Levine, president
and chief executive officer of Accuray. "I am proud of the team's
execution during the quarter, especially given the challenging
operating environment created by the pandemic. We saw strong
operating cash flow generation during the quarter and exited the
quarter with $108.6 million of cash
and short-term restricted cash as we continue to focus on operating
efficiencies and working capital management. We believe that
our operational focus, joint venture strategy in China, and continued investments in our value
creating R&D pipeline projects, positions Accuray strongly for
the future."
Q4 Fiscal 2020 Financial Highlights
Gross product orders totaled $94.3
million for the fourth quarter of fiscal 2020 compared to
$97.2 million for the prior fiscal
year fourth quarter. Ending order backlog was $602.7 million, approximately 22 percent higher
than at the end of the prior fiscal year.
Total revenue was $95.0 million
for the fourth quarter of fiscal 2020 compared to $117.4 million for the prior fiscal year fourth
quarter. Product revenue totaled $40.4
million compared to $60.6
million for the prior fiscal year fourth quarter, while
service revenue totaled $54.6 million
compared to $56.8 million for the
prior fiscal year fourth quarter.
Total gross profit for the fourth quarter of fiscal 2020 was
$39.9 million or approximately 42.0
percent of sales, comprised of product gross margin of 45.0 percent
and service gross margin of 39.8 percent. This compares to total
gross profit of $45.9 million or 39.1
percent of sales, comprised of product gross margin of 40.7 percent
and service gross margin of 37.4 percent for the prior fiscal year
fourth quarter.
Net loss was $0.8 million, or
$0.01 per share, for the fourth
quarter of fiscal 2020, compared to a net loss of $1.4 million, or $0.02 per share, for the prior fiscal year fourth
quarter.
Adjusted EBITDA for the fourth quarter of fiscal 2020 was
$9.3 million, compared to
$8.9 million for the prior fiscal
year fourth quarter.
Cash, cash equivalents, and short-term restricted cash were
$108.6 million as of June 30, 2020, an increase of $17.0 million from March
31, 2020.
Fiscal Year 2020 Highlights
For the fiscal year ended June 30,
2020, gross product orders totaled $377.3 million, representing growth of 10.2
percent compared to the prior fiscal year period.
Total revenue was $382.9 million
for the fiscal year ended June 30,
2020 compared to $418.8
million for the prior fiscal year period. Product revenue
totaled $167.3 million compared to
$196.7 million for the prior fiscal
year period, while service revenue totaled $215.6 million compared to $222.1 million for the prior fiscal year
period.
Total gross profit for the year ended June 30, 2020 was $149.9
million or 39.1 percent of sales, comprised of product gross
margin of 42.7 percent and service gross margin of 36.4 percent.
This compares to total gross profit of $162.7 million or 38.8 percent of sales,
comprised of product gross margin of 40.7 percent and service gross
margin of 37.2 percent for the prior fiscal year period.
Operating expenses were $138.0
million, a decrease of 14.9 percent compared to $162.1 million for the prior fiscal year
period.
Net income was $3.2 million, or
$0.04 per share, basic, for the
fiscal year ended June 30, 2020,
compared to a net loss of $16.4
million, or $0.19 per share,
basic, for the prior fiscal year period. Net income included a
non-cash, special gain of $13.0
million related to the value of the company's capital
contribution to its China joint
venture in exchange for the company's 49% equity interest in the
joint venture. This gain was recorded as non-operating, other
income in the second quarter of fiscal 2020.
Adjusted EBITDA for the fiscal year ended June 30, 2020 was $26.8
million, compared to $23.7
million for the prior fiscal year period.
Financial Guidance
The impact of the COVID-19 pandemic on Accuray's fiscal 2021
results remains uncertain. Given the continued evolution of the
COVID-19 pandemic and the uncertainty surrounding its impact on the
global economy and the healthcare industry, Accuray believes it is
prudent to refrain from providing revenue and adjusted EBITDA
guidance for fiscal year 2021. The company is carefully monitoring
the pandemic and the impact on its business; however, given the
uncertainty regarding the pandemic's spread, duration, and impact,
the company is currently unable to predict the extent to which the
COVID-19 pandemic will impact its future operations and financial
results.
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 fourth quarter and
fiscal 2020 as well as recent corporate developments. Conference
call dial-in information is as follows:
- U.S. callers: (877) 270-2148
- International callers: (412) 902-6510
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 available for seven days. The replay telephone
number is (877) 344-7529 (USA) or
(412) 317-0088 (International), Conference ID:10146316. An archived
webcast will also be available at Accuray's website until Accuray
announces its results for the first quarter of fiscal 2021.
Use of Non-GAAP Financial Measures
Accuray has supplemented its GAAP net loss with a non-GAAP
measure of adjusted earnings before interest, taxes, depreciation,
amortization and stock-based compensation ("adjusted
EBITDA"). The calculation of adjusted EBITDA also excludes
certain non-recurring, irregular and one-time items, including the
non-cash, special gain related to Accuray's capital contribution to
the China joint venture, an
accounts receivable impairment charge, costs associated with
reduction of staff and a non-cash reversal of deferred rent related
to a lease termination. 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.
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) develops, manufactures and
sells radiotherapy systems that are intended to make cancer
treatments shorter, safer, personalized and more effective,
ultimately enabling patients to live longer, better lives. Our
radiation treatment delivery systems in combination with
fully-integrated software solutions set the industry standard for
precision and cover the full range of radiation therapy and
radiosurgery procedures. For more information, please visit
www.accuray.com.
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; expectations regarding the effect of the
COVID-19 pandemic on the company and the company's position after
the pandemic; the company's ability to realize the benefits of its
operational focus, joint venture strategy in China, and continued investments in R&D
pipeline projects; the company's ability to capitalize on operating
efficiencies and working capital management; expectations regarding
future sales in China;
expectations regarding our Chinese joint venture, including the
timing of revenue recognition and the manufacture and shipment of a
joint venture manufactured product; expectations regarding the
company's product portfolio, including with respect to the
company's new Synchrony upgrade; expectations regarding the future
of radiotherapy treatment; and the company's leadership position in
radiation oncology innovation and technologies. 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 COVID-19
pandemic on the operations of the company and those of its
customers and suppliers; the company's ability to achieve
widespread market acceptance of its products, including new product
and software offerings; the company's ability to develop new
products or enhance existing products to meet customers' needs and
compete favorably in the market, the company's ability to
effectively integrate and execute the joint venture, the company's
ability to realize the expected benefits of the joint venture; the
ability of customers in China to
obtain Class or B user licenses to purchase radiotherapy systems;
risks inherent in international operations, the company's ability
to effectively manage its growth, 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 Quarterly Report on Form 10-Q, filed with
the Securities and Exchange Commission (the "SEC") on May 8, 2020 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.
Financial Tables to Follow
Accuray
Incorporated
|
Consolidated
Statements of Operations
|
(in thousands, except
per share data)
|
(Unaudited)
|
|
|
|
Three Months
Ended
June
30,
|
|
|
Twelve Months
Ended
June
30,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Gross
Orders
|
|
$
|
94,293
|
|
|
$
|
97,166
|
|
|
$
|
377,295
|
|
|
$
|
342,321
|
|
Net Orders
|
|
|
74,607
|
|
|
|
64,364
|
|
|
|
280,144
|
|
|
|
218,263
|
|
Order
Backlog
|
|
|
602,713
|
|
|
|
495,627
|
|
|
|
602,713
|
|
|
|
495,627
|
|
Net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Products
|
|
$
|
40,410
|
|
|
$
|
60,646
|
|
|
$
|
167,302
|
|
|
$
|
196,665
|
|
Services
|
|
|
54,567
|
|
|
|
56,771
|
|
|
|
215,626
|
|
|
|
222,120
|
|
Total net
revenue
|
|
|
94,977
|
|
|
|
117,417
|
|
|
|
382,928
|
|
|
|
418,785
|
|
Cost of
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
products
|
|
|
22,221
|
|
|
|
35,956
|
|
|
|
95,882
|
|
|
|
116,711
|
|
Cost of
services
|
|
|
32,860
|
|
|
|
35,535
|
|
|
|
137,174
|
|
|
|
139,423
|
|
Total cost of
revenue
|
|
|
55,081
|
|
|
|
71,491
|
|
|
|
233,056
|
|
|
|
256,134
|
|
Gross
profit
|
|
|
39,896
|
|
|
|
45,926
|
|
|
|
149,872
|
|
|
|
162,651
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
|
12,215
|
|
|
|
16,051
|
|
|
|
49,784
|
|
|
|
56,493
|
|
Selling and
marketing
|
|
|
11,555
|
|
|
|
14,920
|
|
|
|
47,254
|
|
|
|
55,998
|
|
General and
administrative
|
|
|
11,570
|
|
|
|
11,697
|
|
|
|
40,966
|
|
|
|
49,577
|
|
Total operating
expenses
|
|
|
35,340
|
|
|
|
42,668
|
|
|
|
138,004
|
|
|
|
162,068
|
|
Income from
operations
|
|
|
4,556
|
|
|
|
3,258
|
|
|
|
11,868
|
|
|
|
583
|
|
Loss on equity
investment, net
|
|
|
(371)
|
|
|
|
—
|
|
|
|
(149)
|
|
|
|
—
|
|
Other expense,
net
|
|
|
(4,746)
|
|
|
|
(3,794)
|
|
|
|
(6,700)
|
|
|
|
(14,927)
|
|
Income (loss) before
provision for income taxes
|
|
|
(561)
|
|
|
|
(536)
|
|
|
|
5,019
|
|
|
|
(14,344)
|
|
Provision for income
taxes
|
|
|
262
|
|
|
|
864
|
|
|
|
1,863
|
|
|
|
2,086
|
|
Net income
(loss)
|
|
$
|
(823)
|
|
|
$
|
(1,400)
|
|
|
$
|
3,156
|
|
|
$
|
(16,430)
|
|
Net income (loss) per
share - basic
|
|
$
|
(0.01)
|
|
|
$
|
(0.02)
|
|
|
$
|
0.04
|
|
|
$
|
(0.19)
|
|
Net income (loss) per
share - diluted
|
|
$
|
(0.01)
|
|
|
$
|
(0.02)
|
|
|
$
|
0.03
|
|
|
$
|
(0.19)
|
|
Weighted average
common shares used in
computing income (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
90,748
|
|
|
|
88,202
|
|
|
|
89,874
|
|
|
|
87,465
|
|
Diluted
|
|
|
90,748
|
|
|
|
88,202
|
|
|
|
90,623
|
|
|
|
87,465
|
|
Accuray
Incorporated
|
Consolidated
Balance Sheets
|
(in
thousands)
|
(Unaudited)
|
|
|
|
June
30,
|
|
|
June
30,
|
|
|
|
2020
|
|
|
2019
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
107,577
|
|
|
$
|
76,798
|
|
Restricted
cash
|
|
|
997
|
|
|
|
10,218
|
|
Accounts receivable,
net
|
|
|
89,599
|
|
|
|
111,885
|
|
Inventories
|
|
|
134,525
|
|
|
|
120,823
|
|
Prepaid expenses and
other current assets
|
|
|
21,227
|
|
|
|
24,205
|
|
Deferred cost of
revenue
|
|
|
2,712
|
|
|
|
146
|
|
Total current
assets
|
|
|
356,637
|
|
|
|
344,075
|
|
Property and
equipment, net
|
|
|
15,349
|
|
|
|
17,122
|
|
Investment in joint
venture
|
|
|
13,929
|
|
|
|
—
|
|
Goodwill
|
|
|
57,717
|
|
|
|
57,770
|
|
Intangible assets,
net
|
|
|
663
|
|
|
|
679
|
|
Operating lease
right-of-use assets
|
|
|
28,647
|
|
|
|
—
|
|
Other
assets
|
|
|
17,136
|
|
|
|
18,535
|
|
Total
assets
|
|
$
|
490,078
|
|
|
$
|
438,181
|
|
Liabilities and
equity
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
23,126
|
|
|
$
|
29,562
|
|
Accrued
compensation
|
|
|
17,963
|
|
|
|
31,150
|
|
Operating lease
liabilities, current
|
|
|
8,224
|
|
|
|
—
|
|
Other accrued
liabilities
|
|
|
27,180
|
|
|
|
32,742
|
|
Customer
advances
|
|
|
22,571
|
|
|
|
20,395
|
|
Deferred
revenue
|
|
|
83,207
|
|
|
|
78,332
|
|
Total current
liabilities
|
|
|
182,271
|
|
|
|
192,181
|
|
Long-term other
liabilities
|
|
|
7,416
|
|
|
|
9,646
|
|
Deferred
revenue
|
|
|
24,125
|
|
|
|
26,639
|
|
Operating lease
liabilities, non-current
|
|
|
24,173
|
|
|
|
—
|
|
Long-term
debt
|
|
|
189,307
|
|
|
|
159,844
|
|
Total
liabilities
|
|
|
427,292
|
|
|
|
388,310
|
|
Equity:
|
|
|
|
|
|
|
|
|
Common
stock
|
|
|
91
|
|
|
|
89
|
|
Additional paid-in
capital
|
|
|
545,741
|
|
|
|
535,332
|
|
Accumulated other
comprehensive loss
|
|
|
(662)
|
|
|
|
(10)
|
|
Accumulated
deficit
|
|
|
(482,384)
|
|
|
|
(485,540)
|
|
Total
equity
|
|
|
62,786
|
|
|
|
49,871
|
|
Total liabilities and
equity
|
|
$
|
490,078
|
|
|
$
|
438,181
|
|
Accuray
Incorporated
|
Reconciliation of
GAAP Net Loss to Adjusted Earnings Before Interest, Taxes,
Depreciation,
|
Amortization and
Stock-Based Compensation (Adjusted EBITDA)
|
(in
thousands)
|
(Unaudited)
|
|
|
|
Three Months
Ended
June
30,
|
|
|
Twelve Months
Ended
June
30,
|
|
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
GAAP net income
(loss)
|
|
$
|
(823)
|
|
|
$
|
(1,400)
|
|
|
$
|
3,156
|
|
|
$
|
(16,430)
|
|
Depreciation and
amortization
|
|
|
1,960
|
|
|
|
2,178
|
|
|
|
7,526
|
|
|
|
8,266
|
|
Stock-based
compensation
|
|
|
2,287
|
|
|
|
2,822
|
|
|
|
8,152
|
|
|
|
10,601
|
|
Interest expense,
net
|
|
|
4,590
|
|
|
|
3,973
|
|
|
|
17,986
|
|
|
|
15,015
|
|
Gain on contribution
to equity method investment in joint
venture (a)
|
|
|
—
|
|
|
|
—
|
|
|
|
(12,965)
|
|
|
|
—
|
|
Impairment charge
(b)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,707
|
|
Cost savings
initiative (c)
|
|
|
1,058
|
|
|
|
511
|
|
|
|
1,058
|
|
|
|
1,509
|
|
Gain on lease
termination (d)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,007)
|
|
Provision for income
taxes
|
|
|
262
|
|
|
|
864
|
|
|
|
1,863
|
|
|
|
2,086
|
|
Adjusted
EBITDA
|
|
$
|
9,334
|
|
|
$
|
8,948
|
|
|
$
|
26,776
|
|
|
$
|
23,747
|
|
____________________
|
(a) consists of
non-cash gain related to the value of the Company's capital
contribution to the China joint venture.
|
(b) consists of
an accounts receivable impairment charge related to one customer in
the first quarter of 2019.
|
(c) consists of
costs associated with reduction of staff.
|
(d) consists of
a non-cash reversal of deferred rent related to a facility lease
that was terminated.
|
Joe Diaz
|
Beth
Kaplan
|
Investor Relations,
Lytham Partners
|
Public Relations
Director, Accuray
|
+1 (602)
889-9700
|
+1 (408)
789-4426
|
diaz@lythampartners.com
|
bkaplan@accuray.com
|
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SOURCE Accuray Incorporated