X-Ray Products
(Dollars in Millions) 2000 1999 1998 Net Orders $ 147 $ 123 $ 128 Sales $ 136 $ 123 $ 131 Pretax Earnings-as Reported $ 18 $ 11 $ 20 Pretax Earnings-Pro Forma n/a $ 17 $ 20 Pretax Earnings as % of Sales-as Reported 13.1% 8.6% 15.2% Pretax Earnings as % of Sales-Pro Forma n/a 13.9% 15.2% Backlog $ 40 $ 29 $ 30 Capital Expenditures $ 6 $ 8 $ 6 Depreciation & Amortization $ 7 $ 9 $ 7 FY99 pro forma pretax earnings exclude reorganization and non-recurring expenses related to the spin-off of the Company's instruments and semiconductor equipment businesses, on April 2, 1999, and restructuring expense related to the closure of the Arlington Heights X-ray tube facility.
Varian X-Ray Products is the world's premier independent supplier of X-ray tubes, serving manufacturers of radiology equipment and industrial inspection equipment as well as distributors of replacement tubes. This business provides the industry's broadest selection of X-ray tubes expressly designed for the most advanced diagnostic applications, including CT scanning, radiography, and mammography. These products meet evolving requirements for improved resolution, faster patient throughput, longer tube life, smaller dimensions, and greater cost efficiency. X-Ray Products also supplies a new line of amorphous silicon flat-panel X-ray detectors for medical and industrial applications.

2000 Highlights
X-Ray Products achieved double-digit growth in annual sales and orders. It tripled the operating life and manufacturing volume for its innovative 0.5 second CT scanner tube - the world's most powerful tube for high-speed, high-resolution CT scanning. Product development teams completed a unique integral housing design for compact, lightweight, oil-free tubes, putting a mammography unit into pre-production and prototyping a second unit for CT scanning. The business expanded its flat panel imaging line with larger, more sensitive receptors for medical applications. Consolidation of Arlington Heights manufacturing in Salt Lake City led to an improved cost structure in our glass tube products business.

Outlook
Growth for the X-Ray Products business will be focused in the market for high-end CT scanning tubes, as manufacturers continue to demand higher X-ray tube capability for their next generation of fast CT scanners. Additional growth should come from an emerging business in filmless, flat panel imaging systems for industrial and medical applications. X-Ray Products will continue to expand its product line with new tube designs.

Facilities

Charleston, South Carolina Salt Lake City, Utah (headquarters)