Oct 23 Medical device maker Varian Medical
Systems Inc reported lower-than-expected fourth-quarter
results as demand for its products fell due to uncertainties
related to U.S. healthcare reforms and reimbursement cuts.
Shares of the company, which also slashed its earnings
forecast for year ending September 2014, were down about 7
percent in extended trading.
Varian's oncology unit which contributes nearly a third of
its revenue, fell 1 percent as a larger number of customers did
not upgrade their treatment systems as expected.
Gross orders for oncology systems declined 6 percent in
Oncology systems' net orders fell 13 percent to $685 million
including backlog adjustment. The company's backlog was down by
The higher level of cancellations was primarily by small
free-standing clinic developers whose projects did not move
forward, chief executive Dow Wilson said on a conference call.
Varian's customers include university research and community
hospitals, private and governmental institutions, healthcare
agencies, doctors' offices and cancer care clinics.
The company's fourth-quarter net earnings fell 2.4 percent
to $117.3 million or $1.08 per share.
Fourth-quarter net income fell to $117.3 million, or $1.08
per share, from $120.2 million, or $1.08 per share, a year
Total revenue in the fourth quarter rose 2 percent to $770
Analysts on average expected a profit of $1.12 per share on
revenue of $779 million, according to Thomson Reuters I/B/E/S.
The company expects to earn $4.22 to $4.34 per share in
2014, below analysts' average estimate of $4.48.
(Reporting By Adithya Venkatesan; Editing by Don Sebastian)