SALT LAKE CITY, May 3, 2022 – Varex Imaging Corporation (Nasdaq: VREX) today announced its unaudited financial results for the second quarter of fiscal year 2022.
• Revenues $215 million
• GAAP gross margin 33% | Non-GAAP gross margin* 34%
• GAAP operating expense $44 million | Non-GAAP operating expense* $41 million
• GAAP operating margin 12% | Non-GAAP operating margin* 15%
• GAAP net earnings $0.18 per diluted share | Non-GAAP net earnings* $0.37 per diluted share
“We continued to see robust demand for our products in the second quarter of fiscal 2022 and achieved sales of $215 million despite ongoing supply chain constraints,” said Sunny Sanyal, Chief Executive Officer of Varex. Sanyal added, “Strong order momentum combined with supply chain diversification initiatives improve our ability to meet the higher product demand from our customers in the future.”
Varex’s revenues increased 8% sequentially, with the Medical segment up 10% and the Industrial segment increasing 3% from the first quarter of fiscal year 2022. Compared to the second quarter of fiscal year 2021, total revenues increased 6%, with the Medical segment up 9% and the Industrial segment down 6%. NonGAAP gross margin remained flat at 34% percent in the quarter compared to last quarter and non-GAAP EPS improved significantly to $0.37 from $0.25 last quarter.
Balance Sheet & Cash Flow
Cash flow from operations was a reduction of $8 million in the second quarter of fiscal year 2022, which was impacted by an increase in working capital. Cash and cash equivalents declined $43 million sequentially to $115 million at the end of the second quarter. The reduction in cash included the $27 million redemption of Senior Secured Notes during the quarter. Since July 2021, we have redeemed $57 million of our Senior Secured Notes.
The following guidance is provided for the third quarter of fiscal year 2022:
• Revenues are expected to be between $190 million and $220 million
• Non-GAAP net earnings per diluted share is expected to be between $0.10 and $0.30
Guidance for the company’s net earnings per diluted share is provided on a non-GAAP basis only. This non-GAAP financial measure is forward-looking, and the company is unable to provide a meaningful or accurate GAAP forecast of net earnings per diluted share without unreasonable effort due to the uncertainty of amounts and timing of unusual items.
Non-GAAP Financial Measures
*Please refer to “Reconciliation between GAAP and non-GAAP Financial Measures” below for a reconciliation of non-GAAP items to the comparable GAAP measures.
Conference Call Information
Varex will conduct its earnings conference call for the second quarter of fiscal year 2022 today at 3:00 p.m. Mountain Time. The conference call, including a supplemental slide presentation, will be webcast live and can be accessed at Varex’s website at vareximaging.com/news. Access will also be available by dialing 877-524-8416 from anywhere in the U.S. or by dialing 412-902-1028 from non-U.S. locations. The webcast and supplemental slide presentation will be archived on Varex’s website at vareximaging.com/quarterly-reports. A replay of the call will be available from today through May 17th at 877-660-6853 from anywhere in the U.S. or 201-612-7415 from non-U.S. locations. The replay access code is 13728899.
The listen-only webcast link is: https://services.choruscall.com/mediaframe/webcast.html?webcastid=4tQUvghx
Varex Imaging Corporation is a leading innovator, designer and manufacturer of X-ray imaging components, which include X-ray tubes, digital detectors and other image processing solutions that are key components of X-ray imaging systems. With a 70+ year history of successful innovation, Varex’s products are used in medical imaging as well as in industrial and security imaging applications. Global OEM manufacturers incorporate Varex’s X-ray sources, digital detectors, connecting devices and imaging software in their systems to detect, diagnose, protect and inspect. Headquartered in Salt Lake City, Utah, Varex employs approximately 2,100 people located in North America, Europe, and Asia. For more information visit vareximaging.com.
Forward Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Statements concerning unaudited financial results; benefits of cost reduction actions; industry or market outlook; customer demand and revenue trends; revenues, product volumes, or other expected future financial results or performance; and any statements using the terms “believe,” “expect,” “intend,” “outlook,” “future,” “anticipate,” “will,” “could,” “estimate,” “outlook,” “guidance,” or similar statements are forward-looking statements that involve risks and uncertainties that could cause Varex’s actual results to differ materially from those anticipated. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. Such risks and uncertainties include supply chain and logistical challenges; price increases from suppliers and service providers and inflation generally; the severity and duration of the COVID-19 pandemic and its impact on both the global economy and the Varex’s business; shifts in product mix; not receiving the intended benefit of restructurings, cost reduction actions; the continued impact of tariffs or a global trade war on Varex’s products and customer purchasing patterns; global economic conditions and political conditions globally or regionally, including any impact due to armed conflicts (such as the recent conflict between Russia and Ukraine as well as governmental sanctions imposed in response); demand for and delays in delivery of products of Varex or its customers; litigation costs; Varex’s ability to develop, commercialize and deploy new products; the impact of reduced or limited demand by purchasers of certain X-ray products; the impact of competitive products and pricing; and the other risks listed from time to time in our filings with the U.S. Securities and Exchange Commission, which by this reference are incorporated herein. Any forward-looking statements made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. Varex assumes no obligation to update or revise the forward-looking statements in this release because of new information, future events, or otherwise.
Varex has not filed its Form 10-Q for the second quarter of fiscal year 2022. All financial results described here should be considered preliminary, and are subject to change to reflect any necessary adjustments or changes in accounting estimates, that are identified prior to the time Varex files the Form 10-Q.
For Information Contact:
Director of Investor Relations
Varex Imaging Corporation
801.973.1566 | email@example.com
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