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A Letter from Dow Wilson
CHIEF EXECUTIVE OFFICER
P.02
TO OUR STOCKHOLDERS,
Varian Medical Systems delivered solid results in fiscal year 2013, successfully
managing through a number of market challenges. Annual revenues for the company rose by 5 percent
and earnings per diluted share increased by 6 percent. In the 65th year since the company's founding
in 1948, we maintained our leadership in radiation oncology and X-ray imaging components with
good momentum for future growth in all our businesses.
Oncology Systems annual revenues rose 3 percent with solid gains in service and emerging markets
offsetting U.S. weakness related to healthcare reform and reimbursement uncertainties. Markets outside
the United States now represent around 55 percent of our Oncology business. Our performance in
emerging markets was particularly pleasing, with solid growth in China, Brazil, and Africa. The
Oncology service business again generated double-digit growth as our installed base of linear accelerators
expanded to some 7,200 units. We further expanded our product portfolio with new offerings for
stereotactic radiosurgery as well as enhanced software for treatment planning and information
management.
Annual revenues in our X-Ray Products business increased by 11 percent with healthy demand for
tubes as well as our flat panel detectors for filmless digital imaging. During the year, we successfully
reorganized our Security and Inspection Products business, including establishing a new strategic
focus and capitalizing on synergies with the X-Ray Products business. We expect this will drive
further growth for these two components-based businesses. Our proton business reached several
important milestones during the year and we are now setting the stage for the commencement of
patient treatments at Scripps Proton Therapy Center early in 2014.
We owe our success in fiscal 2013 to five strategic initiatives: Innovation, Globalization, Service
and Software, Commercializing Protons, and Operational Excellence. Each of these initiatives will
continue to contribute to our growth in 2014 and I will highlight the vital role that they play in the
rest of this letter.
LETTER CONTINUES ON P.04
VARIAN MEDICAL SYSTEMS, INC. -- 2013 ANNUAL REPORT