VAREX ANNOUNCES FINANCIAL RESULTS FOR FOURTH QUARTER AND FISCAL YEAR 2024

VAREX ANNOUNCES FINANCIAL RESULTS FOR FOURTH QUARTER AND FISCAL YEAR 2024

SALT LAKE CITY, November 19, 2024 – Varex Imaging Corporation (Nasdaq: VREX) today announced its unaudited financial results for the fourth quarter and fiscal year 2024.

Q4 FY24 Summary

• Revenues of $206 million
• GAAP gross margin 33% | Non-GAAP gross margin* 33%
• GAAP operating expense $56 million | Non-GAAP operating expense* $53 million
• GAAP operating margin 5% | Non-GAAP operating margin* 7%
• GAAP net earnings $(1.22) per diluted share | Non-GAAP net earnings* $0.19 per diluted share
• Cash flow from operations $26 million

FY24 Summary

• Revenues of $811 million
• GAAP gross margin 32% | Non-GAAP gross margin* 32%
• GAAP operating expense $225 million | Non-GAAP operating expense* $210 million
• GAAP operating margin 4% | Non-GAAP operating margin* 6%
• GAAP net earnings $(1.17) per diluted share | Non-GAAP net earnings* $0.55 per diluted share
• Cash flow from operations $47 million

Sunny Sanyal, Chief Executive Officer, stated, “Revenue of $206 million in the fourth quarter of fiscal year 2024 was at the high-end of our guidance range, driven by strength in our Industrial segment.” Sanyal added, “Cash generation in the quarter was solid, ending the fiscal year with $213 million of cash and marketable securities on the balance sheet.”

Varex’s revenues in the fourth quarter decreased 10% year-over-year. Medical segment revenue of $144 million was down 12% year-over-year. Industrial revenue of $61 million declined 4% year-over-year. Non-GAAP gross margin was 33% percent in the current quarter compared to 36% in the fourth quarter of fiscal year 2023. Non-GAAP EPS decreased to $0.19 in the current quarter from $0.45 in the fourth quarter of fiscal year 2023.

Sanyal added, “Fiscal 2024 was a year of promising technological achievements. We made substantial progress in advancing innovative technologies like photon counting and nanotubes into applications development and commercialization phases. In our Industrial segment we have taken initial steps to expand into the significant and rapidly growing cargo systems vertical.”

Balance Sheet & Cash Flow

Cash flow from operations was $26 million for the fourth quarter of fiscal year 2024. Cash, cash equivalents, marketable securities, and certificates of deposits as of the end of fiscal year 2024 totaled $213 million.

Outlook

The following guidance is provided for the first quarter of fiscal year 2025, which is a 14 week operating quarter:

• Revenues are expected between $195 million and $215 million
• Non-GAAP net earnings per diluted share is expected to be between -$0.05 and $0.10

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 reconciliation to a GAAP forecast of net earnings per diluted share without unreasonable effort due to certain of these reconciling items being uncertain, out of our control, and the amount and timing of these items being unable to be reasonably predicted. The actual amounts of such reconciling items could have a significant impact on the company’s GAAP net income per diluted share.

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 fourth quarter of fiscal year 2024 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/investors. 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. A replay of the call will be available from today through December 3rd at 877-660-6853 from anywhere in the U.S. or 201-612-7415 from non-U.S. locations. The replay access code is 13749585. The listen-only webcast link is: https://event.choruscall.com/mediaframe/webcast.html?webcastid=K9rkp5fg

About Varex

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 the company’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 2,300 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 the Private Securities Litigation Reform Act of 1995. Statements concerning unaudited financial results; earnings guidance; industry or market outlook; advancement of innovative technologies and product developments; and other expected future financial results or performance; and any statements using the terms “believe,” “expect,” “encouraged,” “intend,” “outlook,” “future,” “anticipate,” “will,” “could,” “estimate,” “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 reduction in or loss of business of one or more of our limited OEM customers; loss of business to, and an inability to effectively compete with competitors; market erosion or loss of customers due to pricing pressures and other factors; failure  to meet customers’ needs and demands; economic instability, shifting political environments, changing tax treatment, reactionary import/export regulatory regimes, and other risks associated with doing business internationally; supply chain disruptions; inability to maintain or defend intellectual property rights, and the high cost of protecting such rights and defending against infringement claims; disruption of critical information systems or material security breaches of such systems; non-compliance with product-related regulations and delays in obtaining regulatory clearances or approvals; limitations imposed by operating and financial restrictions of our debt financing agreements; 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 statement 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-K for the fiscal year 2024. 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-K.

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For Information Contact:
Christopher Belfiore
Director of Investor Relations
Varex Imaging Corporation
801.973.1566 | investors@vareximaging.com