Stung by widening losses, Accuray plans $75M debt offering | Wall Street Beat

February 7, 2013 by MassDevice staff

On the heels of gaping losses and a more than 25% sales decline, Accuray announces plans for a $75 million debt round. Wall Street Beat

Accuray (NSDQ:ARAY) plans to issue $75 million worth of convertible senior notes as it gears up to restructure its business after a year of widening losses.

The Sunnyvale, Calif.-based medical device company said it will use the proceeds from the offering of debt due Feb. 1, 2018, to shore up its balance sheet.

"Accuray's purpose for the offering is to strengthen its balance sheet in order to help improve its competitive position," according to a press release. "It intends to use the net proceeds from the offering for general corporate purposes, including investing strategically in expanding its business and new product initiatives."

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Fiscal 2nd-quarter sales and profits were way off for Accuray, which makes radiation oncology equipment. The company posted losses of $29.2 million, or 40¢ per share, on sales of $77.8 million for the 3 months ended Dec. 31, 2012. That amounts to a 180.8% increase in losses and a 26.9% top-line reduction.

The news sent ARAY shares down nearly 10% today on Wall Street.