SOURCE: TomoTherapy


October 28, 2009 16:00 ET

TomoTherapy Announces Third Quarter Financial Results

Reports $34.4 Million of Revenue; $21 Million of Equipment Orders

MADISON, WI--(Marketwire - October 28, 2009) - TomoTherapy Incorporated (NASDAQ: TOMO), producer of the Hi·Art® treatment system and other products for advanced radiation therapy, today released financial results for the third quarter ended September 30, 2009.

Third Quarter Results

Third quarter 2009 revenue was $34.4 million, an increase of 26% from $27.4 million in the third quarter of 2008. The company incurred a net loss attributable to shareholders of $13.9 million, or $0.27 per share, for the third quarter of 2009, compared to a net loss of $13.0 million, or $0.26 per share, for the third quarter of 2008. As of September 30, 2009, the company had $147.1 million of cash, cash equivalents and short-term investments, representing a $1.4 million reduction from the previous quarter end. As of such date, the company also had minimal debt and there were no borrowings against the company's credit facility.

As of September 30, 2009, the company had a revenue backlog of $140 million, a 4% decrease from the $146 million backlog as of June 30, 2009. The backlog includes $21 million of equipment orders received during the third quarter of 2009, less $3 million removed from backlog due to a customer failing to make a scheduled payment. No orders were removed for competitive reasons. Backlog includes only firm orders that the company believes are likely to ship within the next two years. It does not include any revenue from service contracts, which represents a growing portion of the company's overall revenue.

"Although the economic environment remained challenging in the third quarter, we continued to make progress against several key performance initiatives," said Fred Robertson, TomoTherapy's CEO. "We reported a 26% increase in revenue, a 12% decrease in operating expenses and we continue to show improved performance in our service organization as the average direct cost of servicing a unit declined by 7% year-over-year, while year-to-date uptime remains strong at 98.1%. Importantly, we also maintained a strong capital position during the quarter," Robertson added. "Given the soft economic and market conditions, we continue to carefully control costs and, to that end, we recently initiated a restructuring program that includes an approximate 10% reduction in force. Associated with the program, we will recognize a total restructuring charge of approximately $2.1 million, or $0.04 per share, in the fourth quarter of 2009. We believe these actions, which will deliver additional cost savings beginning late in the fourth quarter, will help us to better manage through the current economic downturn while also positioning us for the future. In addition to an intense focus on costs, we continue to strengthen our sales efforts to ensure a consistent and effective strategic and tactical approach throughout the organization. Our confidence in the benefits of TomoTherapy technology remains steadfast. We firmly believe it offers the most advanced and effective system to deliver high-quality cancer care and look forward to expanding our reach to an even greater number of patients worldwide," commented Robertson.

Nine-Month Results

For the nine months ended September 30, 2009, revenue was $106.1 million, a 10% decrease from $118.3 million for the nine months ended September 30, 2008. The company incurred a net loss attributable to shareholders of $34.0 million, or $0.67 per share, for the nine months ended September 30, 2009, compared to a net loss of $26.0 million, or $0.52 per share, for the same period last year.


For the fourth quarter of fiscal 2009, management currently anticipates revenue of $50 million to $70 million and a loss per share in the range of $0.06 to $0.23. This would result in full year revenue in the previously announced range of $155 million to $175 million and a narrowing of the full year loss to the range of $0.73 to $0.90 per share from the previously announced range of $0.65 to $0.90 per share. Both the fourth quarter and full year loss per share ranges include the impact of the $0.04 total restructuring charge. The company continues to take a disciplined approach to cash management.

Investor Conference Call

TomoTherapy will conduct a conference call regarding its third quarter 2009 results at 5:00 p.m. ET today, October 28, 2009 (4:00 p.m. CT). To hear a live Webcast or replay of the call, visit the Investor Relations page at, where it will be archived for two weeks. To access the call via telephone, dial 1-866-271-5140 from inside the United States or 1-617-213-8893 from outside the United States, and enter pass code 68787199. 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 61705477. The telephone replay will be available through 10:59 p.m. CT on November 4, 2009.

About TomoTherapy Incorporated

TomoTherapy Incorporated develops, markets and sells advanced radiation therapy solutions that can be used to 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. TomoTherapy's suite of solutions include its flagship 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. TomoTherapy's stock is traded on the NASDAQ Global Select Market under the symbol TOMO. To learn more about TomoTherapy, please visit

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 company's technology; growth drivers; the company's orders, revenue, backlog or earnings growth; future financial results and any statements using the terms "should," "believe," "outlook," "expect," "anticipate" or similar statements are forward-looking statements that involve risks and uncertainties that could cause the company's actual results to differ materially from those anticipated. Such risks and uncertainties include: demand for the company's products; impact of sales cycles and competitive products and pricing; the effect of economic conditions and currency exchange rates; the company's ability to develop and commercialize new products; its reliance on sole or limited-source suppliers; its ability to increase gross margins; the company's 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 company's ability to protect 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 its operations due to terrorism, disease or other events beyond the company's control; and the other risks listed from time to time in the company's filings with the U.S. Securities and Exchange Commission, which by this reference are incorporated herein. TomoTherapy assumes no obligation to update or revise the forward-looking statements in this release because of new information, future events or otherwise.


                 (In thousands, except per share amounts)

                                 Three months ended     Nine months ended
                                    September 30,         September 30,
                                --------------------  --------------------
                                  2009       2008       2009       2008
                                ---------  ---------  ---------  ---------

Revenue                         $  34,378  $  27,374  $ 106,081  $ 118,295
Cost of revenue                    30,820     28,281     91,469     98,459
                                ---------  ---------  ---------  ---------
  Gross profit                      3,558       (907)    14,612     19,836
                                ---------  ---------  ---------  ---------
Operating expenses:
  Research and development          7,218     10,947     20,086     30,516
  Selling, general and
   administrative                  12,470     11,547     34,347     35,850
                                ---------  ---------  ---------  ---------
     Total operating expenses      19,688     22,494     54,433     66,366
                                ---------  ---------  ---------  ---------
Loss from operations              (16,130)   (23,401)   (39,821)   (46,530)
Other income (expense):
  Interest income                     617      1,032      2,009      3,896
  Interest expense                    (18)       (17)       (47)       (34)
  Other income (expense), net         105        479       (258)       323
                                ---------  ---------  ---------  ---------
     Total other income               704      1,494      1,704      4,185
                                ---------  ---------  ---------  ---------
Loss before income tax and
 noncontrolling interests         (15,426)   (21,907)   (38,117)   (42,345)
  Income tax expense (benefit)        256     (6,300)      (162)   (12,220)
                                ---------  ---------  ---------  ---------
Net loss                          (15,682)   (15,607)   (37,955)   (30,125)
  Noncontrolling interests          1,802      2,654      3,953      4,139
                                ---------  ---------  ---------  ---------
Net loss attributable to
 shareholders                     (13,880)   (12,953)   (34,002)   (25,986)
                                =========  =========  =========  =========

Loss per common share - basic
 and diluted                    $   (0.27) $   (0.26) $   (0.67) $   (0.52)
                                =========  =========  =========  =========


                              (In thousands)

                                                September 30, December 31,
                                                    2009          2008
                                                ------------- -------------
Cash and cash equivalents                       $      68,527 $      65,967
Short-term investments                                 78,598        88,825
Receivables, net                                       21,771        41,259
Inventories, net                                       59,884        63,983
Deferred tax assets                                         -           496
Prepaid expenses and other current assets               3,268         1,890
                                                ------------- -------------
  Total current assets                                232,048       262,420
Property and equipment, net                            19,804        22,157
Other non-current assets, net                          13,533        11,851
                                                ------------- -------------
  TOTAL ASSETS                                  $     265,385 $     296,428
                                                ============= =============

                      LIABILITIES AND EQUITY
Accounts payable                                $       7,862 $       7,804
Accrued expenses                                       18,916        18,324
Accrued warranty                                        3,797         7,431
Deferred revenue                                       29,569        28,139
Customer deposits                                      13,793        15,494
                                                ------------- -------------
  Total current liabilities                            73,937        77,192
Other non-current liabilities                           2,270         3,487
                                                ------------- -------------
  TOTAL LIABILITIES                                    76,207        80,679
Total shareholders' equity                            184,113       213,594
Noncontrolling interests                                5,065         2,155
                                                ------------- -------------
  TOTAL EQUITY                                        189,178       215,749
TOTAL LIABILITIES AND EQUITY                    $     265,385 $     296,428
                                                ============= =============

Contact Information

  • Contact:
    TomoTherapy Incorporated
    Tom Powell