Accuray, a radiology oncology company based in Sunnyvale, California, announced that it would issue $75 million in convertible senior notes as part of a restructuring effort at the company. The restructuring plan and debt round follow a year of ever-increasing losses at the company.
According to a press release from the company, proceeds from the debt (due on February 1st, 2018) will be used to improve its balance sheet.
In its press release, the company stated, "Accuray's purpose for the offering is to strengthen its balance sheet in order to help improve its competitive position." The press release continued, "[Accuray] intends to use the net proceeds from the offering for general corporate purposes, including investing strategically in expanding its business and new product initiatives."
Accuray’s second-quarter profits and sales were significantly less than average. In the second quarter, the company posted a loss of $29.2 million on sales of $77.8 million. The company’s second quarter ended on December 31st of last year. The total loss in the second quarter is the equivalent of a 40 cent loss per company share. Compared to the previous year, the recent earnings report shows a 26.9 percent top-line reduction and a loss increase rate of 180.8 percent.
Following the news, investors backed off from the company. On Thursday, following the release of its earnings report, shares at the company dropped 10 percent.