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8-K - FORM 8-K - TomoTherapy Inc | c16455e8vk.htm |
Exhibit 99.1
Contact: TomoTherapy Incorporated
Thomas E. Powell, CFO
608-824-2800
Thomas E. Powell, CFO
608-824-2800
TomoTherapy Announces First Quarter Financial Results
Reports $47.2 Million of Revenue, $28.6 Million of Equipment Orders
Madison,
Wis. May 3, 2011 TomoTherapy Incorporated
(NASDAQ: TOMO), maker of advanced
radiation therapy solutions for cancer care, today released financial results for the first quarter
ended March 31, 2011.
First Quarter Results
Revenue for the first quarter of 2011 was $47.2 million, an increase of 12% from $42.1 million in
the first quarter of 2010. Revenue from product sales was $31.7 million in the first quarter of
2011, up 8% compared to the same quarter last year, and revenue from service and other was $15.5
million in the first quarter of 2011, up 21% compared to the same quarter last year. The company
reported a first quarter 2011 loss from operations of $9.7 million, a $3.7 million increase from
the $6.0 million loss from operations for the same quarter last year.
The company incurred a net loss attributable to shareholders of $7.2 million, or $0.13 per share,
for the first quarter of 2011, compared to a net loss of $4.7 million, or $0.09 per share, for the
first quarter of 2010. Included in the results for the first quarter of 2011 are expenses related
to the proposed merger with Accuray of $2.1 million, or $0.04 per share.
As of March 31, 2011, the company had $137.4 million of cash, cash equivalents and short-term
investments, representing a $14.7 million decrease from December 31, 2010. There were no
borrowings against the companys credit facility during the quarter.
As of March 31, 2011, the company had a revenue backlog of $130.8 million, a 2% decrease from the
$133.0 million backlog as of December 31, 2010. The backlog includes $28.6 million of equipment
orders received during the first quarter of 2011. Backlog includes firm orders that the company
believes are likely to ship within the next two years, as well as the minimum payments due to the
company under system rental contracts. Backlog does not include any revenue from service
contracts, which represents a growing portion of the companys overall revenue.
Overall, our first quarter financial performance was in line with our internal expectations, and
we are pleased with our revenue growth in the period, said Fred Robertson, TomoTherapys CEO.
From a
product perspective, we now have installations of our new TomoHD treatment system in Europe, North
America and the Asia-Pacific region, and this new system is generating significant interest across
our existing and prospective customers. With the TomoHD treatment system and our other offerings,
we have successfully developed products and product enhancements that provide broader, more diverse
functionality and we are gratified by the markets positive reaction. In addition to progress on
the product side, service and other revenue grew significantly from the prior year, and at the same
time, we have continued to focus on improving system reliability and uptime while reducing the
necessary maintenance of our systems.
Robertson continued, Most notably, on March 7, we announced that TomoTherapy entered into an
agreement to be acquired by Accuray. We are very excited about this compelling combination, which
will bring together two best-in-class technologies to create the premier radiation oncology
company. The combined company will provide highly complementary products, and will have a strong
global presence, extensive research and development capabilities, and importantly, a continued
commitment to fighting cancer worldwide. Through this transaction, we will be able to provide a
broader range of solutions to customers and patients, greater career opportunities for employees,
and attractive value for our shareholders. Last week, Accuray announced the expiration of the
mandatory, pre-merger waiting period in accordance with the HSR Antitrust Improvements Act. We are
moving ahead with additional regulatory processes and remain on track to close the transaction in
either the second or beginning of the third quarter.
Outlook
Management reaffirmed its revenue and earnings guidance for 2011. Management still expects revenue
to be $215 million to $235 million, with the net loss attributable to shareholders projected to be
in the range of ($0.30) to ($0.50) per share.
Investor Conference Call
TomoTherapy will conduct a conference call regarding its first quarter 2011 results at 5:00 p.m.
ET, May 3, 2011 (4:00 p.m. CT). To hear a live Webcast or replay of the call, visit the
Investor Relations page at TomoTherapy.com, where it will be archived for two weeks. To access
the call via telephone, dial 1-866-804-6927 from inside the United States or 1-857-350-1673 from
outside the United States, and enter pass code 65695506. The replay can be accessed by dialing
1-888-286-8010 from inside the United States or 1-617-801-6888 from outside the United States and
entering pass code 98537692. The telephone replay will be available through 11:59 p.m. ET on May
10, 2011.
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About TomoTherapy Incorporated
TomoTherapy Incorporated develops, markets and sells advanced radiation therapy solutions that can
be used to efficiently treat a wide variety of cancers, from the most common to the most complex.
The ring gantry-based TomoTherapy® platform combines integrated CT imaging with
conformal radiation therapy to deliver sophisticated radiation treatments with speed and precision
while reducing radiation exposure to surrounding healthy tissue. TomoTherapys suite of solutions
includes its Hi·Art® treatment system, which has been used to deliver more than three
million CT-guided, helical intensity-modulated radiation therapy (IMRT) treatment fractions; the
TomoHD treatment system, designed to enable cancer centers to treat a broader patient
population with a single device; and the TomoMobile relocatable radiation therapy
solution, designed to improve access and availability of state-of-the-art cancer care.
TomoTherapys stock is traded on the NASDAQ Global Select Market under the symbol TOMO. To learn
more about TomoTherapy, please visit TomoTherapy.com.
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Statements concerning market acceptance of the companys
technology; growth drivers; the companys orders, revenue, backlog or earnings growth; future
financial results and any statements using the terms will, should, believe, outlook,
expect, anticipate or similar statements are forward-looking statements that involve risks and
uncertainties that could cause the companys actual results to differ materially from those
anticipated. Such risks and uncertainties include: demand for the companys products; impact of
sales cycles and competitive products and pricing; the effect of economic conditions and currency
exchange rates; the companys ability to develop and commercialize new products; its reliance on
sole or limited-source suppliers; its ability to increase gross margins; the companys ability to
meet U.S. Food and Drug Administration (FDA) and other regulatory agency product clearance and
compliance requirements; the possibility that material product liability claims could harm future
revenue or require the company to pay uninsured claims; the companys ability to protect its
intellectual property; the impact of managed care initiatives, other health care reforms and/or
third-party reimbursement levels for cancer care; potential loss of key distributors or key
personnel; risk of interruptions to the companys operations due to terrorism, disease or other
events beyond the companys control; and the other risks listed from time to time in the companys
filings with the U.S. Securities and Exchange Commission, which by this reference are incorporated
herein. In addition, this news release may contain certain forward-looking statements that
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involve
risks and uncertainties associated with the transaction between Accuray Incorporated (Accuray) and TomoTherapy Incorporated (TomoTherapy).
These risks and uncertainties include: the satisfaction of closing conditions for the transaction
between Accuray and TomoTherapy; market conditions; the effect of the announcement of the
transaction on Accurays and TomoTherapys respective businesses; the impact of any failure to
complete the transaction; the risk that Accuray and TomoTherapy will not realize the anticipated
benefits of the transaction; the potential inability to successfully operate or integrate
TomoTherapys business; general industry and economic conditions; the outcome of legal proceedings
that have been instituted or may be instituted in the future against TomoTherapy or Accuray in
connection with the transaction and other factors beyond the companies control and the risk
factors and other cautionary statements described in Accurays and TomoTherapys filings with the
SEC. TomoTherapy assumes no obligation to update or revise the forward-looking statements in this
release because of new information, future events or otherwise.
Important Additional Information
This communication is being made in respect of the proposed merger transaction involving Accuray
and TomoTherapy. In connection with the proposed transaction, Accuray has filed with the Securities
and Exchange Commission (the SEC) a registration statement on Form S-4 and TomoTherapy will mail
a proxy statement/prospectus to its shareholders, and each will also be filing other documents
regarding the proposed transaction with the SEC. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION,
INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION AND
ANY OTHER RELEVANT DOCUMENTS CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE, BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. The final proxy
statement/prospectus will be mailed to TomoTherapys shareholders. Shareholders will be able to
obtain a free copy of the proxy statement/prospectus, as well as other filings containing
information about TomoTherapy and Accuray, without charge, at the SECs Internet site
(http://www.sec.gov). Copies of the proxy statement/prospectus and the filings with the SEC that
will be incorporated by reference in the proxy statement/prospectus can also be obtained, without
charge, by directing a request to Vice President and General Counsel, TomoTherapy Incorporated,
1212 Deming Way, Madison, Wisconsin, 53717, (608) 824-2800.
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Participants in the Solicitation
TomoTherapy and its directors and executive officers and other persons may be deemed to be
participants in the solicitation of proxies in respect of the proposed transaction. Information
regarding TomoTherapys directors and executive officers is available in TomoTherapys Annual
Report on Form 10-K for the year ended December 31, 2010 and Amendment No. 1 thereto, which were
filed with the SEC on March 3, 2011 and April 15, 2011, respectively. Other information regarding
the participants in the proxy solicitation and a description of their direct and indirect
interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus
and other relevant materials filed with the SEC when they become available.
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TOMOTHERAPY
INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
Three Months Ended March 31 | ||||||||
2011 | 2010 | |||||||
Revenue: |
||||||||
Product |
$ | 31,677 | $ | 29,229 | ||||
Service and other |
15,496 | 12,851 | ||||||
Total revenue |
47,173 | 42,080 | ||||||
Cost of revenue: |
||||||||
Product |
14,239 | 12,785 | ||||||
Service and other |
20,125 | 16,691 | ||||||
Total cost of revenue |
34,364 | 29,476 | ||||||
Gross profit |
12,809 | 12,604 | ||||||
Operating expenses: |
||||||||
Research and development |
7,441 | 7,540 | ||||||
Selling, general and administrative |
15,032 | 11,034 | ||||||
Total operating expenses |
22,473 | 18,574 | ||||||
Loss from operations |
(9,664 | ) | (5,970 | ) | ||||
Other income (expense): |
||||||||
Interest income |
215 | 531 | ||||||
Interest expense |
(29 | ) | (11 | ) | ||||
Other income (expense), net |
1,741 | (448 | ) | |||||
Total other income (expense) |
1,927 | 72 | ||||||
Loss before income tax and noncontrolling interests |
(7,737 | ) | (5,898 | ) | ||||
Income tax expense (benefit) |
753 | (44 | ) | |||||
Net loss |
(8,490 | ) | (5,854 | ) | ||||
Noncontrolling interests |
1,325 | 1,176 | ||||||
Net loss attributable to shareholders |
$ | (7,165 | ) | $ | (4,678 | ) | ||
Weighted-average common shares outstanding - basic and diluted |
53,125 | 51,566 | ||||||
Loss per common share basic and diluted |
$ | (0.13 | ) | $ | (0.09 | ) | ||
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TOMOTHERAPY INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
March 31, | December 31, | |||||||
2011 | 2010 | |||||||
ASSETS |
||||||||
Cash and cash equivalents (CPAC balances of $68 and $333) |
$ | 137,362 | $ | 123,905 | ||||
Short-term investments |
| 28,150 | ||||||
Receivables, net (CPAC balances of $0 and $244) |
29,735 | 32,850 | ||||||
Inventories, net |
59,094 | 49,270 | ||||||
Prepaid expenses and other current assets (CPAC balances of $8 and $74) |
1,682 | 1,816 | ||||||
Total current assets |
227,873 | 235,991 | ||||||
Property and equipment, net (CPAC balances of $2,752 and $2,941) |
21,065 | 22,026 | ||||||
Other non-current assets, net (CPAC balances of $103 and $106) |
13,326 | 11,545 | ||||||
TOTAL ASSETS |
$ | 262,264 | $ | 269,562 | ||||
LIABILITIES AND EQUITY |
||||||||
Accounts payable (CPAC balances of $121 and $103) |
$ | 21,498 | $ | 13,405 | ||||
Notes payable (CPAC balances of $754 and $530) |
754 | 530 | ||||||
Accrued expenses (CPAC balances of $601 and $647) |
27,220 | 30,388 | ||||||
Accrued warranty |
4,354 | 5,045 | ||||||
Deferred revenue |
32,441 | 34,033 | ||||||
Customer deposits |
14,154 | 17,483 | ||||||
Total current liabilities |
100,421 | 100,884 | ||||||
Other non-current liabilities (CPAC balances of $15 and $16) |
2,049 | 2,477 | ||||||
TOTAL LIABILITIES |
102,470 | 103,361 | ||||||
Total shareholders equity |
157,502 | 162,593 | ||||||
Noncontrolling interests |
2,292 | 3,608 | ||||||
TOTAL EQUITY |
159,794 | 166,201 | ||||||
TOTAL LIABILITIES AND EQUITY |
$ | 262,264 | $ | 269,562 | ||||
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