Medical device company Accuray (NSDQ:ARAY) said it’s completed a "year of transition" as it looks to the release of 2 new products in October, which it says will help "change the dynamic" of the radiosurgery market.
The Sunnyvale, Calif.-based radiosurgery medical device maker reported net losses of $72 million, or about $1.02 per share, on sales of $240 million, representing 170% more red ink compared with losses of $26.7 million for fiscal 2011.
Accuray said it actually narrowed losses during the 4th quarter, to $20 million from $24.9 million, on a 26.8% sales boost. The 2012 top line was $60.6 million, compared with $47.8 million during FY2011.
But results for the 1st quarter of FY 2013 could be "substantially below the first quarter of fiscal 2012," the company said, as customers hold off on ordering until Accuray completes new product rollouts. Those are expected to launch in October at the American Society of Radiation Oncology’s annual meeting in Boston.
The news sent ARAY shares down 13.7% last week, from a Sept. 6 close of $6.54 to a $5.75 open the next day. Shares were trading at $5.81 as of about 10:50 a.m. today, down 0.4%.
"We believe that we will see a number of customers upgrade their orders to the newer technology after ASTRO," Accuray CEO Euan Thomson said during a conference call with investors.
The company said it expects sales to be in the range of $405 million-$425 million in FY2013, with the majority of revenue expected in the 2nd half of the year.
Thomson called 2012 a year of transition as Accuray looked to integrate assets its acquired in a $277 million TomoTherapy merger.
Accuray CFO Derek Botocci told analysts that integrating the 2 firms affected sales, as new orders anticipated in 2012 did not materialize due to "challenges we faced in integrating the 2 sales teams in the United States."
But company officials were confident that the new product releases slated for ASTRO would have a dramatic effect on the company. Thomson described the new products as a "major technology launch," but declined to elaborate. The company has set up a website to generate buzz for the Oct. 28th release.
"You shouldn’t underestimate the impact of these technology releases. I think customers are aware of something significant going on, even before our public announcement on this call," he said. "That gives us a challenge in Q1, as we discussed, which we then have to recover on for the remainder of the year. And I think you should see this level of guidance as confidence that we will definitively recover from that as we go through the year."
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