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Varian Medical Systems Inc posted a 48 per cent increase in quarterly earnings on Wednesday, citing strong growth in its oncology and X-ray businesses, as well as lower taxes.

Varian Medical Systems Inc posted a higher-than-expected 48 per cent increase in quarterly earnings on Wednesday, citing strong growth in its oncology and X-ray businesses, as well as lower taxes.

The Palo Alto, California-based provider of software and equipment for cancer clinics posted fiscal third-quarter net income of $74 million, or 58 cents per share, compared with $50 million, or 39 cents per share, in the year-ago quarter ended June.
Analysts, on average, expected a profit of 46 cents a share, according to Reuters Estimates.

Quarterly revenue rose 21 per cent to $513 million.

"Our oncology systems, X-ray products and security businesses contributed to significant growth in revenues," Chief Executive Tim Guertin said in a statement.

He also said Varian had an unusually low 18 per cent tax rate for the quarter due to tax benefits.

Looking ahead, the CEO projected that Varian's full-year 2008 net earnings would increase by about 22 per cent over the previous year, while revenue would rise by 17 per cent to 18 per cent.

"At this early stage, we estimate that revenues for fiscal 2009 could grow by about 12 per cent and that earnings per diluted share should grow at a slightly faster rate than revenues," he added.

Varian shares, which rose 1.6 per cent to close at $53.28 on the New York Stock Exchange, were not trading after hours.

(Reporting by Deena Beasley; editing by Carol Bishopric and Andre Grenon)