Accuray Announces Preliminary Results for Second Quarter Fiscal 2013 and Updated Guidance for Fiscal 2013; Announces Restructuring

Thu Jan 3, 2013 4:00pm EST

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Conference Call at 5:00 p.m. EST Today
SUNNYVALE, Calif.,  Jan. 3, 2013  /PRNewswire/ -- Accuray Incorporated (Nasdaq:
ARAY) announced today preliminary results for the second quarter of fiscal 2013
that ended  December 31, 2012  and updated guidance for fiscal 2013. Non-GAAP
results are provided to enhance understanding of Accuray's ongoing core results
of operations. The company also is announcing a restructuring of operations.  

Preliminary consolidated GAAP revenues for second quarter fiscal 2013 are
expected to be in the range of  $72 million to $75 million  and total non-GAAP
revenue of  $72 million to $75 million. By comparison, for the second quarter of
fiscal 2012, total GAAP revenue was  $106.4 million  and total non-GAAP revenue
was  $102.9 million. Based on these preliminary estimates, product revenue for
the second quarter of fiscal 2013 declined 45-50 percent versus the prior year
period, while service revenue posted an increase of 13-15 percent year over
year, both in terms of non-GAAP results. Net loss on a non-GAAP basis is
expected to be in a range of  $25 million to $30 million  for the second quarter
of fiscal 2013.  

Net orders to backlog are estimated to be in the range of  $15 million to $17
million  and product backlog is expected to be in the range of  $275 million to
$280 million  for the second fiscal quarter 2013, down from  $294 million  at
the end of the prior quarter.

The second fiscal quarterly results reflect a shortfall relative to
expectations, which is attributable to challenges faced in two primary areas of
the business: (1) manufacturing and supply related issues, which delayed
contribution from new products launched at the 2012 Annual Meeting of the
American Society for Radiation Oncology (ASTRO), and (2) commercial focus and
salesforce transitional issues.

Accuray is announcing a restructuring of operations to focus on improving
commercial execution and position the company to support sustainable revenue
growth and profitability. Through the restructuring, management is establishing
a cost structure that will reallocate resources to commercial sales and
marketing initiatives and improved business processes to support accelerated
revenue growth. The restructuring is expected to reduce staffing by
approximately 13 percent and is most heavily concentrated in  the United States.
 

As a result of the restructuring, Accuray expects to take a non-recurring charge
of  $3 million to $4 million  in the third quarter fiscal 2013. The company
expects operating expense savings of approximately  $40 million  per year
compared to fiscal 2012, with initial impact benefitting fourth quarter fiscal
2013 results.

"In my first 90 days at Accuray, I have spent considerable time evaluating the
strategic and operational activities at the company, and have found many reasons
to be highly enthusiastic and confident in the future prospects and success of
the company. We have truly differentiated technologies in our two primary
product platforms and a loyal installed base of customers. Our new systems
introduced at ASTRO expand the treatable patient population, increase accuracy,
and improve throughput - creating economic value for our radiation oncology
customers and clinical benefit for patients," said  Joshua Levine, President and
Chief Executive Officer of Accuray.  

"However, we have identified challenges that have pressured results
operationally and distinct areas that require improvement - and we have a
clearly defined path to address these. As such, we are initiating a strategic
transformation at Accuray in order to drive consistent performance that is
required to create value to our customers and shareholders over the long term,"
said Levine. "Through the restructuring we announced today, we are establishing
a cost structure to support sustainable revenue growth and profitability through
commercial execution, service excellence and improved business processes."

Fiscal 2013 Guidance
Accuray management projects that fiscal 2013 revenue will be in the range of 
$320 million to $330 million. Net loss for fiscal 2013 is projected to be in the
range of  $63 million to $69 million  or a net loss of  ($0.87)  to  ($0.95) 
per share. This guidance represents expected results on a non-GAAP basis.  

Conference Call Details
Accuray will hold a conference call for financial analysts and investors on 
Thursday, January 3, 2013  at  2:00 p.m. PST/5:00 p.m. EST. The conference call
dial-in numbers are 888-396-2356 or 617-847-8709, Conference ID: 92559419.  A
live webcast of the call will also be available from the Investor Relations
section of the corporate website at  www.accuray.com/investors.  In addition, a
recording of the call will be available by calling 888-286-8010 or 617-801-6888,
Conference ID: 69675278, beginning at  5:00 p.m. PST/8:00 p.m. EST  on  January
3, 2013  and will be available through  January 10, 2013. A webcast replay will
also be available from the Investor Relations section of the Company's website
at  www.accuray.com/investors  for 90 days.  

About Accuray
Accuray Incorporated (Nasdaq: ARAY), based in  Sunnyvale, Calif., is a radiation
oncology company that develops, manufactures and sells personalized, innovative
treatment solutions that set the standard of care with the aim of helping
patients live longer, better lives. The Company's leading-edge technologies -
the CyberKnife and TomoTherapy Systems - are designed to deliver radiosurgery,
stereotactic body radiation therapy, intensity modulated radiation therapy,
image guided radiation therapy, and adaptive radiation therapy. To date, 681
systems have been installed in leading hospitals around the world. 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 preliminary
results for the second quarter including: total revenue, product revenue,
service revenue, net loss, and backlog; the effects of the introduction of new
CyberKnife and TomoTherapy Systems; commercial execution; the company's future
growth including: order growth, revenue growth and future profitability; and
fiscal 2013 guidance including:  revenue, net loss and earnings per share.
Forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ materially from expectations, including but not
limited to: the company's ability to convert backlog to revenue; the success of
its worldwide sales and marketing efforts; the success of the introduction of
our CyberKnife and TomoTherapy Systems; the extent of market acceptance for the
company's products and services; the company's ability to manage its expenses;
continuing uncertainty in the global economic environment; and other risks
detailed from time to time under the heading "Risk Factors" in the company's
report on Form 10-K  filed on September 10, 2012, the company's report on Form
10-Q for the first quarter of fiscal 2013 filed on  November 8, 2012, and as
updated from time to time in our other SEC filings.   

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.

SOURCE  Accuray Incorporated


Tom Rathjen, Vice President, Investor Relations, +1-408-789-4458,
trathjen@accuray.com, or Stephanie Tomei, Director, Corporate Communications,
+1-408-789-4234, stomei@accuray.com
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