VARIAN MEDICAL SYSTEMS INC

CIK:0000203527|SEC Filings

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Jan. 01, 2021	Jan. 03, 2020
Revenues:
Revenues	$ 778.8	$ 828.9
Cost of revenues:
Total cost of revenues	419.8	462.1
Gross margin	359.0	366.8
Operating expenses:
Research and development	72.2	67.1
Selling, general and administrative	161.9	177.0
Acquisition-related expenses	7.7	12.7
Total operating expenses	241.8	256.8
Operating earnings	117.2	110.0
Interest income	2.8	3.0
Interest expense	(1.3)	(4.7)
Other income, net	5.7	4.4
Earnings before taxes	124.4	112.7
Taxes on earnings	27.6	23.8
Net earnings	96.8	88.9
Less: Net earnings attributable to noncontrolling interests	0.3	0.7
Net earnings attributable to Varian	$ 96.5	$ 88.2
Earnings Per Share [Abstract]
Net earnings per share - basic (in dollars per share)	$ 1.06	$ 0.97
Net earnings per share - diluted (in dollars per share)	$ 1.05	$ 0.96
Shares used in the calculation of net earnings per share:
Weighted average shares outstanding - basic (in shares)	91.4	90.9
Weighted average shares outstanding - diluted (in shares)	92.2	91.7
Product
Revenues:
Revenues	$ 364.2	$ 421.0
Cost of revenues:
Total cost of revenues	245.1	271.9
Service
Revenues:
Revenues	414.6	407.9
Cost of revenues:
Total cost of revenues	$ 174.7	$ 190.2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended
	Jan. 01, 2021	Jan. 03, 2020
Cash flows from operating activities:
Net earnings	$ 96.8	$ 88.9
Adjustments to reconcile net earnings to net cash provided by operating activities:
Share-based compensation expense	16.7	14.9
Depreciation	16.0	15.0
Amortization of intangible assets and inventory step-up	9.8	10.2
Deferred taxes	14.9	1.8
Gain on equity investments	(9.2)	(1.4)
Change in fair value of contingent consideration	0.2	8.8
Other, net	1.3	0.9
Changes in assets and liabilities, net of effects of acquisitions:
Trade and unbilled receivables	29.1	29.5
Inventories	(52.5)	(44.9)
Prepaid expenses and other assets	3.6	6.3
Accounts payable	8.0	(32.7)
Accrued liabilities and other long-term liabilities	(64.2)	(42.1)
Deferred revenues	70.9	57.4
Net cash provided by operating activities	141.4	112.6
Cash flows from investing activities:
Purchases of property, plant and equipment	(16.8)	(22.6)
Acquisitions, net of cash acquired	(0.5)	(1.7)
Purchase of equity and notes receivable in privately-held companies	(10.3)	0.0
Sale of equity investments	0.0	9.2
Net cash used in investing activities	(27.6)	(15.1)
Cash flows from financing activities:
Repurchases of common stock	0.0	(43.8)
Proceeds from issuance of common stock to employees	52.4	19.7
Tax withholdings on vesting of equity awards	(7.6)	(3.6)
Borrowings under credit facility agreement	0.0	11.0
Repayments under credit facility agreement	0.0	(11.0)
Net (repayments) borrowings under the credit facility agreements with maturities less than 90 days	(145.0)	132.0
Other	0.0	(0.9)
Net cash (used in) provided by financing activities	(100.2)	103.4
Effects of exchange rate changes on cash, cash equivalents, and restricted cash	(6.3)	(2.8)
Net increase in cash, cash equivalents, and restricted cash	7.3	198.1
Cash, cash equivalents, and restricted cash at beginning of period	785.8	544.1
Cash, cash equivalents, and restricted cash at end of period	$ 793.1	$ 742.2

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jan. 01, 2021	Oct. 02, 2020
Current assets:
Cash and cash equivalents	$ 773.3	$ 766.1
Trade and unbilled receivables, less allowance for credit losses of $55.2 and $52.3 at January 1, 2021 and October 2, 2020, respectively	1,029.3	1,066.1
Inventories	571.7	516.3
Prepaid expenses and other current assets	267.0	254.8
Total current assets	2,641.3	2,603.3
Property, plant and equipment, net	346.5	344.9
Operating lease right-of-use assets	119.5	121.0
Goodwill	627.7	623.9
Intangible assets	265.0	271.3
Deferred tax assets	65.4	81.5
Other assets	460.7	416.3
Total assets	4,526.1	4,462.2
Current liabilities:
Accounts payable	206.5	194.9
Accrued liabilities	482.7	522.4
Deferred revenues	845.7	782.2
Short-term borrowings	210.0	355.0
Total current liabilities	1,744.9	1,854.5
Long-term lease liabilities	101.7	101.1
Other long-term liabilities	431.7	421.8
Total liabilities	2,278.3	2,377.4
Commitments and contingencies (Note 8)
Equity:
Preferred stock of $1 par value: 1.0 shares authorized; none issued and outstanding	0.0	0.0
Common stock of $1 par value: 189.0 shares authorized; 91.8 and 91.2 shares issued and outstanding at January 1, 2021 and October 2, 2020, respectively	91.8	91.2
Capital in excess of par value	997.7	937.0
Retained earnings	1,225.6	1,133.0
Accumulated other comprehensive loss	(76.8)	(85.7)
Total Varian stockholders' equity	2,238.3	2,075.5
Noncontrolling interest	9.5	9.3
Total equity	2,247.8	2,084.8
Total liabilities and equity	$ 4,526.1	$ 4,462.2