Varian Medical Systems (VAR) is engaged in manufacturing, sales, and service of hardware and software products for the treatment of cancer. It provides software solutions for information management, patient care management, practice management, and decision-making.
In this series, we’ll explore Varian’s financials, the performance of its essential products, significant pipeline developments, and its valuation metrics.
In January, Varian entered into an agreement to acquire Australian company Sirtex Medical for ~1.6 billion Australian dollars. In May, Sirtex received a conditional acquisition proposal from CDH Investments, a Chinese alternative asset manager. The offer was 33.6 Australian dollars per share, which compared to Varian’s offer of 28 Australian dollars per share. In June, Sirtex notified Varian that it had accepted the CDH proposal. The acquisition agreement between Varian and Sirtex was terminated, and Varian received $9 million in breakup fees from Sirtex.
By the end of June, Varian had acquired two private software companies and a radiotherapy equipment distributor for $58.7 million in aggregate. All three acquisitions have been integrated into Varian’s Oncology Systems unit. In August, Varian acquired Humaniq Global, which manufactures Identity, an automated patient identification, positioning, and motion management system for radiation therapy.
Varian Medical Systems’ total gross orders decreased from $810.3 million in the third quarter of 2017 to $767.1 million in the third quarter of 2018. The decrease was attributed to lower gross orders from its Varian Particle Therapy segment, which decreased from $122.6 million in the third quarter of 2017 to $3.8 million in the third quarter of 2018. Gross orders from Varian’s Oncology Systems segment, on the other hand, increased 11% YoY (year-over-year) to $763.3 million in the third quarter.
The company’s total order backlog at the end of the third quarter was $2.9 billion.
We’ll take a look at Varian Medical Systems’ top line in the next part.