On October 29, 2020 Accuray Incorporated (NASDAQ: ARAY) today reported its financial results for the first quarter of fiscal 2021 ended September 30, 2020 (Press release, Accuray, OCT 29, 2020, View Source [SID1234569422]).
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First Quarter Fiscal 2021 Summary
Net revenue of $85.3 million, operating income of $5.5 million
Adjusted EBITDA grew to $9 million from a loss of $1 million in the prior year first quarter
Gross orders of $50.5 million, ending backlog of $597.3 million, an increase of 21 percent from September 30, 2019
Other Recent Operational Highlights
Expect revenue recognition for China Type A systems previously awarded in October 2019 to start in the second quarter of fiscal 2021
Introduced ClearRT Helical kVCT Imaging for the Radixact System at ASTRO 2020
44 clinical abstracts related to customer clinical experience on CyberKnife and TomoTherapy/Radixact exhibited at ASTRO 2020 Scientific Sessions
"We are off to a solid start in fiscal 2021 despite the headwinds created by the COVID-19 environment. Our global team continues to adapt and make the necessary adjustments to compete and operate effectively given the current market conditions and delivered the fourth consecutive quarter of operating profit, said Joshua H. Levine, President and CEO of Accuray. "Looking ahead, we will be focused on driving the revenue conversion process related to the China Type A systems beginning in the second quarter. Concurrent with this year’s recent ASTRO meeting, we have received very positive customer feedback related to the introduction of our ClearRT Helical kVCT imaging upgrade for the Radixact System as we drive our long-term strategic commitment to continued innovation."
Q1 Fiscal 2021 Financial Highlights
Gross product orders totaled $50.5 million for the first quarter of fiscal 2021 compared to $78.5 million for the prior fiscal year first quarter. Order backlog as of September 30, 2020 was $597.3 million, approximately 21 percent higher than at the end of the prior fiscal year first quarter.
Total net revenue was $85.3 million for the first quarter of fiscal 2021 compared to $89.6 million for the prior fiscal year first quarter. Product revenue totaled $31.3 million for the first quarter of fiscal 2021 compared to $37.6 million for the prior fiscal year first quarter, while service revenue totaled $54.1 million for the first quarter of fiscal 2021 compared to $52.0 million for the prior fiscal year first quarter.
Total gross profit for the first quarter of fiscal 2021 was $35.4 million or approximately 41.5 percent of total net revenue, comprised of product gross margin of 41.1 percent of product net revenue and service gross margin of 41.7 percent of service net revenue. This compares to total gross profit of $32.9 million or 36.8 percent of total net revenue, comprised of product gross margin of 42.6 percent of product net revenue and service gross margin of 32.5 percent of service net revenue for the prior fiscal year first quarter.
Net income was $0.4 million, or $0.0 per share, for the first quarter of fiscal 2021, compared to a net loss of $9.4 million, or a loss of $0.11 per share, for the prior fiscal year first quarter.
Adjusted EBITDA for the first quarter of fiscal 2021 was a positive $9.0 million, compared to a negative $1.0 million for the prior fiscal year first quarter.
Cash, cash equivalents, and short-term restricted cash were $95.5 million as of September 30, 2020, a decrease of $13.1 million from June 30, 2020 primarily due to a $10 million prepayment in principal with respect to our long-term debt.
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 financial guidance for fiscal year 2021.
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 2021 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.
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:10148905. An archived webcast will also be available at Accuray’s website until Accuray announces its results for the second quarter of fiscal 2021.
Use of Non-GAAP Financial Measures
Accuray has supplemented its GAAP net income (loss) with a non-GAAP measure of adjusted earnings before interest, taxes, depreciation, amortization and stock-based compensation ("adjusted EBITDA"). 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.