Accuray(US:ARAY)2022-01-28 21:39Financial Performance - Total net revenue for the three months ended December 31, 2021, was $116.275 million, a 19.3% increase from $97.459 million in the same period of 2020[21] - Product revenue for the three months ended December 31, 2021, was $60.721 million, up 45.2% from $41.805 million year-over-year[21] - Gross profit for the three months ended December 31, 2021, was $42.627 million, compared to $40.831 million in the same period of 2020, reflecting a gross margin improvement[21] - Net income for the three months ended December 31, 2021, was $179 thousand, a decrease from $4.769 million in the same period of 2020[21] - Net income for the six months ended December 31, 2021, was a loss of $849,000 compared to a net income of $5,171,000 for the same period in 2020[29] - The company reported a total operating expense of $38.646 million for the three months ended December 31, 2021, compared to $32.632 million in the same period of 2020[21] - Cash provided by operating activities increased to $24,011,000 for the six months ended December 31, 2021, up from $16,414,000 in the prior year[29] Assets and Liabilities - Total current assets as of December 31, 2021, were $351.320 million, slightly down from $352.773 million as of June 30, 2021[17] - Total liabilities increased to $424.507 million as of December 31, 2021, compared to $411.258 million as of June 30, 2021[17] - Cash and cash equivalents as of December 31, 2021, were $123.196 million, up from $116.369 million as of June 30, 2021[17] - As of December 31, 2021, total remaining performance obligations amounted to $1,102.7 million, with an estimated 21% to 29% expected to be recognized in the next 12 months[57] - The company reported unbilled accounts receivable of $11.4 million as of December 31, 2021, down from $12.4 million as of June 30, 2021[53] - Customer advances amounted to $24.6 million as of December 31, 2021, slightly down from $24.9 million as of June 30, 2021[53] - Deferred revenue – current was reported at $76.6 million as of December 31, 2021, compared to $81.7 million as of June 30, 2021[53] Research and Development - Research and development expenses increased to $14.697 million for the three months ended December 31, 2021, from $11.956 million in the same period of 2020, indicating a focus on innovation[21] - Share-based compensation increased to $5,211,000 for the six months ended December 31, 2021, from $4,608,000 in the same period of 2020[29] - Research and development expenses increased by $2.7 million for the three months ended December 31, 2021, totaling $14.7 million, reflecting a 23% increase[190] COVID-19 Impact - The company anticipates continued adverse impacts on revenue and net income due to delays in deliveries and installations related to the COVID-19 pandemic[36] - The COVID-19 pandemic has adversely impacted backlog conversion to revenue, with delays in deliveries and installations expected to continue at least through the end of fiscal 2022[176] - The company expects a higher than normal level of age-outs in the coming quarters due to the ongoing impact of the COVID-19 pandemic[180] - The company is closely monitoring supply chain disruptions and increased material costs, which are expected to continue affecting gross margins and net income[176] Debt and Financing - The Company issued $85.0 million of 3.75% Convertible Senior Notes due 2022, with a conversion price of approximately $5.72 per share[101] - As of December 31, 2021, the total carrying value of the Company's debt was $182,033,000, with an estimated fair value of $200,705,000[97] - The Company has a Term Loan Facility of $80 million and a Revolving Credit Facility of $40 million, with initial borrowings of $25 million under the Revolving Credit Facility[112] - The initial interest rate on the Credit Facilities is LIBOR plus 3.00%, subject to adjustments based on financial performance[113] - The Company recorded a loss of $4.3 million on the extinguishment of debt related to the 3.75% Convertible Notes due 2022[104] Revenue Recognition - The Company recognizes revenue at a point in time for product sales and over time for service revenue, with disaggregation of revenues by geographic region[133] - Revenue from the Americas region was $40.983 million for the three months ended December 31, 2021, compared to $25.332 million in the same period of 2020, representing a 61.6% increase[134] - For the quarter ended December 31, 2021, the company recognized revenues of $22.3 million, and for the six months ended December 31, 2021, revenues totaled $55.8 million[55] Joint Venture and Investments - As of December 31, 2021, the company had a carrying value of $14.7 million in its joint venture, representing a 49% equity interest[140] - The joint venture reported revenue of $15.792 million for the six months ended September 30, 2021, down from $17.374 million in the same period of 2020, indicating a 9.1% decline[142] - The total assets of the joint venture were reported at $81.927 million as of September 30, 2021, compared to $41.956 million in the same period of 2020, reflecting a significant increase[144] Operational Metrics - As of December 31, 2021, backlog totaled $581.3 million, a decrease from $616.4 million as of June 30, 2021[177] - Gross orders for the three months ended December 31, 2021 increased by $10.0 million to $85.4 million compared to $75.4 million for the same period in 2020[183] - Net orders decreased by $2.3 million for the three months ended December 31, 2021, totaling $40.2 million, compared to $42.5 million for the same period in 2020[185] Expenses - Selling and marketing expenses rose by $2.9 million, or 28%, for the three months ended December 31, 2021, mainly due to increased compensation and trade show expenses[199] - General and administrative expenses increased by $0.4 million, or 4%, for the three months ended December 31, 2021, attributed to higher consulting services and board fees[201] - Interest expense related to contractual interest coupon for the three months ended December 31, 2021, was $1.8 million, down from $2.8 million in the same period of 2020[122]