SOURCE: TomoTherapy

TomoTherapy

February 18, 2011 07:00 ET

TomoTherapy Announces Fourth Quarter and Full Year Financial Results

Reports $62.1 Million of Revenue, $34.5 Million of Equipment Orders for Fourth Quarter; 19% Increase in Revenues, 57% Increase in Equipment Orders for Full Year

MADISON, WI--(Marketwire - February 18, 2011) - TomoTherapy Incorporated (NASDAQ: TOMO), maker of advanced radiation therapy solutions for cancer care, today released financial results for the fourth quarter and full year ended December 31, 2010.

Fourth Quarter Results

Revenue for the fourth quarter of 2010 was $62.1 million, an increase of 7% from $58.0 million in the fourth quarter of 2009. Revenue from product sales was $48.1 million in the fourth quarter of 2010, up 8% compared to the same quarter last year, and revenue from service and other was $13.9 million in the fourth quarter of 2010, up 5% compared to the same quarter last year. The company reported a fourth quarter 2010 loss from operations of $8.4 million, a $3.3 million increase from the $5.1 million loss from operations for the same quarter last year.

The company incurred a net loss attributable to shareholders of $6.4 million, or $0.12 per share, for the fourth quarter of 2010, compared to a net loss of $3.4 million, or $0.07 per share, for the fourth quarter of 2009. Restructuring charges of $1.9 million, or $0.04 per share, were included in the fourth quarter 2009 results. There were no restructuring charges in 2010.

As of December 31, 2010, the company had $152.1 million of cash, cash equivalents and short-term investments, representing a $12.0 million increase from September 30, 2010. There were no borrowings against the company's credit facility during the quarter.

For the twelve months ended December 31, 2010, the company received equipment orders of $144.2 million, a 57% increase from orders of $91.8 million for the twelve months ended December 31, 2009. As of December 31, 2010, the company had a revenue backlog of $133.0 million, a 9% decrease from the $146.4 million backlog as of September 30, 2010. The backlog includes $34.5 million of equipment orders received during the fourth quarter of 2010. Backlog includes firm orders that the company believes are likely to ship within the next two years, as well as the minimum payments due to the company under system rental contracts. Backlog does not include any revenue from service contracts, which represents a growing portion of the company's overall revenue.

"We are pleased with our fourth quarter financial performance, which gave us a strong close to the year," said Fred Robertson, TomoTherapy's CEO. "This quarter included a significant milestone for us: the delivery of our first TomoHD™ treatment system. This is a critical achievement, as this product is generating substantial interest with both new and existing customers, and represents the fulfillment of our commitment to the market that we made at ASTRO in 2009. Our year-over-year product revenue growth and 57% increase in year-over-year equipment orders reflect the market's desire for our new, expanded offerings and enhanced functionality. Service and other revenue also experienced strong growth, as we are making substantial investments to improve the reliability of our systems and minimize the amount of maintenance they require. Additionally, we were able to improve our cash position from the third quarter due to our continued focus on managing our capital."

Twelve-Month Results

For the twelve months ended December 31, 2010, revenue was $195.4 million, a 19% increase from $164.0 million for the twelve months ended December 31, 2009. Revenue from product sales was $141.4 million in fiscal year 2010, up 17% when compared to 2009, and revenue from service and other was $54.0 million in fiscal year 2010, up 24% compared to 2009.

The company reported a loss from operations of $38.4 million for full-year 2010, a 14% decrease from the loss from operations of $44.9 million during 2009. The company incurred a net loss attributable to shareholders of $29.9 million, or $0.58 per share, for the twelve months ended December 31, 2010, compared to a net loss attributable to shareholders of $37.4 million, or $0.74 per share, for the same period last year.

During 2010, the company's cash, cash equivalents and short-term investments decreased by $2.3 million. In the same period, the company's backlog decreased by $2.8 million, from $135.8 million as of December 31, 2009 to $133.0 million as of December 31, 2010.

Outlook

Management expects 2011 revenue to be $215 million to $235 million, with the net loss attributable to shareholders projected to be in the range of ($0.30) to ($0.50) per share.

Robertson concluded, "Our 2010 results reflect the positive impact of our expanded product offering as well as our integrated global sales and marketing efforts, and represents significant progress toward our objective of achieving profitability. We believe that these results validate the initiatives we have implemented, and these initiatives will continue to drive positive results going forward. We have made it easier for hospitals and cancer centers of all kinds to adopt and apply TomoTherapy technology to advance the treatment of cancer and other diseases. Demand for the TomoTherapy solution continues to stabilize in key markets worldwide as evidence emerges on the clinical value of our unique, fully-integrated ring gantry-based radiation therapy solution."

Investor Conference Call

TomoTherapy will conduct a conference call regarding its fourth quarter 2010 results at 8:00 a.m. ET, February 18, 2011 (7:00 a.m. CT). To hear a live Webcast or replay of the call, visit the Investor Relations page at TomoTherapy.com, where it will be archived for two weeks. To access the call via telephone, dial 1-866-788-0542 from inside the United States or 1-857-350-1680 from outside the United States, and enter pass code 60251994. 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 24123299. The telephone replay will be available through 11:59 p.m. ET on March 4, 2011.

About TomoTherapy Incorporated

TomoTherapy Incorporated develops, markets and sells advanced radiation therapy solutions that can be used to efficiently 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 includes its 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 TomoTherapy.com.

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 "will," "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 its 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 the company's 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.

                TOMOTHERAPY INCORPORATED AND SUBSIDIARIES

              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  (In thousands, except per share data)
                                (unaudited)



                                 Three Months Ended   Twelve Months Ended
                                    December 31           December 31
                                --------------------  --------------------
                                  2010       2009       2010       2009
                                ---------  ---------  ---------  ---------

Revenue:
  Product                       $  48,123  $  44,634  $ 141,353  $ 120,571
  Service and other                13,948     13,316     54,010     43,460
                                ---------  ---------  ---------  ---------
    Total revenue                  62,071     57,950    195,363    164,031
                                ---------  ---------  ---------  ---------
Cost of revenue:
  Product                          23,189     23,022     69,561     62,801
  Service and other                24,017     18,594     78,865     70,284
                                ---------  ---------  ---------  ---------
    Total cost of revenue          47,206     41,616    148,426    133,085
                                ---------  ---------  ---------  ---------
      Gross profit                 14,865     16,334     46,937     30,946
                                ---------  ---------  ---------  ---------
Operating expenses:
    Research and development        8,802      7,553     33,530     27,639
    Selling, general and
     administrative                14,457     13,833     51,791     48,180
                                ---------  ---------  ---------  ---------
      Total operating expenses     23,259     21,386     85,321     75,819
                                ---------  ---------  ---------  ---------
Loss from operations               (8,394)    (5,052)   (38,384)   (44,873)
Other income (expense):
    Interest income                   203        577      1,492      2,586
    Interest expense                   (9)       (11)       (36)       (58)
    Other income (expense), net      (284)      (162)       229       (420)
                                ---------  ---------  ---------  ---------
      Total other income
       (expense)                      (90)       404      1,685      2,108
                                ---------  ---------  ---------  ---------
Loss before income tax and
 noncontrolling interests          (8,484)    (4,648)   (36,699)   (42,765)
    Income tax expense (benefit)      129       (126)       142       (288)
                                ---------  ---------  ---------  ---------
Net loss                           (8,613)    (4,522)   (36,841)   (42,477)
    Noncontrolling interests        2,226      1,154      6,917      5,107
                                ---------  ---------  ---------  ---------
Net loss attributable to
 shareholders                   $  (6,387) $  (3,368) $ (29,924) $ (37,370)
                                =========  =========  =========  =========

Weighted-average common shares
 outstanding - basic and diluted   52,909     51,170     52,034     50,777
                                =========  =========  =========  =========

Loss per common share - basic
 and diluted                    $   (0.12) $   (0.07) $   (0.58) $   (0.74)
                                =========  =========  =========  =========




                TOMOTHERAPY INCORPORATED AND SUBSIDIARIES

                  CONDENSED CONSOLIDATED BALANCE SHEETS
                              (In thousands)
                                (unaudited)


                                               December 31,   December 31,
                                                   2010           2009
                                               -------------  -------------

                              ASSETS
Cash and cash equivalents (CPAC balances of
 $333 and $1,590)                              $     123,905  $      76,108
Short-term investments                                28,150         78,225
Receivables, net (CPAC balances of $244 and $0)       32,850         33,559
Inventories, net                                      49,270         47,669
Prepaid expenses and other current assets
 (CPAC balances of $74 and $494)                       1,816          3,633
                                               -------------  -------------
  Total current assets                               235,991        239,194
Property and equipment, net (CPAC balances of
 $2,941 and $555)                                     22,026         18,628
Other non-current assets, net (CPAC balances
 of $106 and $30)                                     11,545         12,429
                                               -------------  -------------
  TOTAL ASSETS                                 $     269,562  $     270,251
                                               =============  =============


                    LIABILITIES AND EQUITY
Accounts payable (CPAC balances of $103 and
 $24)                                          $      13,405  $       6,269
Notes payable  (CPAC balances of $530 and $0)            530              -
Accrued expenses (CPAC balances of $647 and $20)      30,388         19,588
Accrued warranty                                       5,045          4,173
Deferred revenue                                      34,033         34,145
Customer deposits                                     17,483         13,266
                                               -------------  -------------
  Total current liabilities                          100,884         77,441
Other non-current liabilities (CPAC balances
 of $16 and $18)                                       2,477          5,475
                                               -------------  -------------
  TOTAL LIABILITIES                                  103,361         82,916

Total shareholders' equity                           162,593        183,424
Noncontrolling interests                               3,608          3,911
                                               -------------  -------------
  TOTAL EQUITY                                       166,201        187,335
                                               -------------  -------------
  TOTAL LIABILITIES AND EQUITY                 $     269,562  $     270,251
                                               =============  =============

Contact Information

  • Contact:
    TomoTherapy Incorporated
    Thomas E. Powell
    CFO
    608-824-2800