WASHINGTON (dpa-AFX) - Varian Medical Systems, Inc. (VAR)Wednesday said third-quarter profit declined from the prior year, hit by an impairment charge. Revenue growth was modest, amid delays in proton revenue recognition as well as weakness in X-ray tubes sales. The stock fell nearly 3 percent in extended trade.
Net earnings slipped to $107.1 million from $112.8 million in the previous year.
Earnings per share were $1.02, compared to $1.03 last year. Varian said net earnings were hurt by about $0.06 per share due to an $8 million impairment charge related to a portion of its existing equity investment in Augmenix, a privately-held company developing minimally invasive hydrogels for radiotherapy.
On average, 13 analysts polled by Thomson Reuters expected earnings of $1.09 per share for the quarter. Analysts' estimates typically exclude special items.
Varian's company-wide revenues totaled $747.7 million, up 3 percent from the year-ago quarter's $726.2 million. Analysts expected revenues of $767.47 million.
Oncology Systems' third quarter revenues grew 3 percent to $578 million, while in Imaging Components, the growth was 2 percent at $162 million.
Gross orders increased to $840.2 million from $773.1 million.
Dow Wilson, CEO, said, 'Company revenues were lighter than expected due to delays in proton revenue recognition as well as weakness in X-ray tubes sales. However, gross margins were up for both Oncology Systems and Imaging Components.'
Looking ahead, the company expects total company revenues for the fourth quarter to increase in the range of 7 to 15 percent and net earnings per share to be in the range of $1.14 to $1.29.
Varian said its fourth quarter revenue and earnings per share guidance range is tied to the timing of its proton therapy projects.
Wall Street looks for earnings of $1.26 per share on revenues of $868.25 million.
VAR, which closed down 2.4 percent at $87.52, fell 2.9 percent in the extended trade.
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