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A WORLD LEADER IN X-RAY IMAGING COMPONENTS

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This presentation contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Among others, statements concerning industry outlook and information relating to Varex Imaging Corporation’s (the “company”) goals; priorities; financial results; conditions and assumptions; earnings guidance, future tax rates, growth opportunities; the impact of tariffs; demand for the company’s products; the company’s future orders, revenues, product volumes, or earnings growth or other future financial results or performance; the ability of the company's technology and products to achieve stated results oroutcomes; customer service and innovation plans; customer relationships, including the ability to attract new customers and retain current customers; addressable markets; the ability to obtain regulatory and third party approvals; expected acquisition benefits; expected benefits from restructurings; and any statements using the words “anticipate,” “plan,” “estimate,” “expect,” “target”, “assume,” “opportunity,” “will,” “should,” “projected,” or similar statements are forward-looking statements that involve risks and uncertainties that could cause our actual results to differ materially from those anticipated. Such risks and uncertainties include the ability to continue to find markets for our products; effectively integrate recent acquisitions and the ability to retain the services of key acquired personnel; global economic conditions, including the impact of tariffs; demand for and delays in delivery of products of the company or its customers; the company’s ability to develop, commercialize and deploy new products; the impact of reduced or limited demand by purchasers of certain X-ray products; the impact of competitive products and pricing; and the other risks listed from time to time in the company’s filings with the U.S. Securities and Exchange Commission, which by this reference are incorporated herein. Any forward-looking statements made by us in this presentation speak only as of the date made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. The company assumes no obligation to update or revise the forward-looking statements in this presentation because of new information, future events, or otherwise.

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WHO WE AREOur mission at Varex Imaging is to be the world’s leader in imaging components through the delivery of high quality products that enable our customers’ success.

X-ray Imaging Innovators• 250+ patents• ~25% of employees are

engineers

Relationship Builders• Work with +90% of X-ray

imaging OEMs• 40+ year partnerships with top

5 customers

Efficient Manufacturers>25,000 X-ray Tubes/year>21,000 Flat Panel Detectors/year>100,000 HV Cable Assemblies/year

Product Portfolio Leaders• Extensive portfolio of critical

imaging components• Broad breadth of complementary

accessory products

~2000 Employees

20+ Global Mfg. & Service Center

Locations

65+ years in X-ray Imaging Components

HQ in Salt Lake City, UT USA

65+

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FY2018 Performance Metrics

Gross Margin 33%Adj. Gross Margin* 35%

Operating Margin 6%Adj. Operating Margin* 11%

FY2018 Revenues

• Medical +8% ● Industrial +21%• Included full year contribution from

acquired imaging business• Mammography, Fluoroscopy &

Industrial up; CT & Radiography stable; 3D Dental down

*See - reconciliation between GAAP and adjusted financial measures in appendix of this presentation

FY2018 Financial Results

Revenues: +11% to $773M

EPS: $0.72 per diluted shareAdj. EPS*: $1.30 per diluted share

Cash flow from operations: $85M Free cash flow: $65M

$620$698

$773

$0

$200

$400

$600

$800

FY2016 FY2017 FY2018

REVENUES($ in millions)

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TWO PRIMARY MARKETS

Medical[~80% of Revenues]

We partner with medical, dental, and veterinary OEMs to help bring their products to market faster with our imaging components and technology.

• x-ray tubes • detectors • software & workstations • cables & interconnects

• collimators

Industrial[~20% of Revenues]

We partner with system integrators in the industrial NDT, cargo inspection and airport security industries to provide key imaging components.

• x-ray tubes • detectors • linear accelerators

• specialized software

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HOW WE WIN INMEDICAL

• Innovation leader in X-ray tubes

• Pioneer in digital detectors

• Broad product portfolio

• Manufacturing scale

Key Market Trends

— China healthcare expansion: CT

— Emerging market expansion

— Increasing global adoption of digital technology

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HOW WE WIN ININDUSTRIAL & SECURITY • Innovation in high energy X-ray

imaging technologies

• A provider of choice for digital detectors

• Reliability and up-time

Key Market Trends

— Increased demand for cargo screening at ports & borders and airports using CT

imaging technology

— New X-ray imaging applications and increased productivity in NDT testing and

inspection

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DEEP CUSTOMER RELATIONSHIPS

• Early engagement in customer Product Development Cycles

• Continuous Product Replacement/Refresh Cycles

• Typically engaged in multiple development projects with each customer

Long-Term Customer RelationshipsAverage +25 Years

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GROWTH DRIVER: China’s Healthcare Reform InitiativesGovernment expanding geographic delivery of healthcare services including imaging systems

CT is modality of choice

Government preference for local Chinese manufacturers

• Varex engaged with local OEMs developing CT systems for China market

• Some OEMs transitioning to production & hospital installation• 5 three-year OEM pricing agreements valued at +$120M• Ramp-up of CT tube shipments to OEMs during FY2018;

expect shipments to more than double in FY2019

Key StatisticsCT system growth in China estimated at +6%

Projected +25,000 new CT systems over next 10 years

+3,500 new CT systems to be installed in government hospitals by end of 2020

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Industrial Nondestructive Testing

• NDT applications include: oil & gas, aerospace, automotive, military and manufacturing industries

• Acquired VMI in 4QFY18 for proprietary NDT imaging software that can be used with Varex detectors

GROWTH DRIVER: Industrial NDT & Security

Cargo Screening: Ports/Borders & Airports• CT technology being incorporated in new airport

screening systems for checked/carry-on bags

• We introduced a new platform of linear accelerators for mobile cargo screening applications

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ACQUISITION GROWTH

Completed 5 acquisitions in past 4

years resulting in >$200M in revenue growth

Strategically expanding product & technologycapabilities to provide

customers with comprehensive X-ray imaging component

offerings

ConsolidationPerkinElmer Imaging Business: highly complementary digital detector business

Opportunities: OEM divestitures, detector manufacturers

Portfolio ExpansionMeVis: imaging software post processing

Claymount: high voltage cables and collimators

VMI: industrial NDT proprietary imaging software

Opportunities: Additional X-ray imaging components, software, new technologies

Adjacent OpportunitiesAcquisitions that leverage Varex brand, technology and manufacturing expertise

FY2018 ROICPKI = 10%

MeVis = 14%Claymount = 10%

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RESTRUCTURINGRestructuring & Impairment Charges Primarily related to consolidation of operations in the acquired imaging business.FY2018 $17MFY2019 ~$4M - $6M expected

Integration of the acquired imaging business complete; moving forward with consolidation.• Closing a-Si glass fabrication at Santa

Clara facility and London detector R&D facility; expect to be substantially completed 1QFY19

• Transfer glass production to dpiX facility• Scintillator production & detector

assembly to continue at the Santa Clara facility

• Expect to achieve ~$10M - $13M in annual cost savings starting in 2H FY2019

• Equates to ~1% GM improvement• Future cost synergies on track

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TARIFFS

OUTLOOK

• Tariffs will likely have a greater impact on our digital detectors than on our other products imported to China

• Trade war has caused us to accelerate plans for operational diversification; increasing local manufacturing at our existing facilities around the world

IMPACT TO VAREXSupply Chain• Purchase of parts/items sourced with Chinese

content or directly from Chinese suppliers

Product Sales In China• Digital detectors, X-ray tubes, other products• Non-OEM aftermarket

ACTION PLANS• Lobby U.S. Legislators & U.S. Trade Rep• Petition China customs to reclassify Varex

product codes• Expand Wuxi facility to manufacture detectors

for sale in China. Underway…6-12 months to be operational

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OUTLOOK – FY2019*

GuidanceRevenues: $755M - $780MAdjusted EPS: $1.25 - $1.55 per diluted share

Impact of TariffsRevenues: $10M - $15M [0-3% growth w/o tariffs]Supply chain costs: $5M - $10MGross Margin: 2 - 3 points

Performance MetricsAdj. Gross Margin: 34% - 35%R&D Expense:

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LONG-TERM VIEW• We continue to see large and healthy end user markets for our Medical and

Industrial segments, particularly CT applications

• We believe investments in R&D will allow us to develop new technologies that are ahead of the curve and bring new products to market that will further differentiate us from our competitors

• Beyond China, we are in the early stages of developing similar relationships with companies in India and Brazil

• We see emerging digital imaging opportunities for Industrial NDT due to the increased speed and performance of digital detectors that enables quicker imaging of objects, making in-line inspection and 3D imaging practical

• The conversion to digital in medical systems is driving demand not only for our detectors, but also for our new high-performance X-ray tubes that enable more advanced 2D and 3D imaging

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INVESTMENT HIGHLIGHTS

Global leader in X-ray imaging components

Comprehensive portfolio in both medical and industrial; global reach

Plan for above-market growth

Organic & Inorganic; targeting 5% long-term growth

Growing global markets

Well positioned in current $4B addressable medical component market and $1B industrial component market

Deep relationships with leading OEMs

Average customer relationship exceeds 20 years

Strong and experienced leadership team

65+ years in imaging components business; leadership averaging over 24 years in industry

Track record of growth & operational excellence

Sales CAGR of 12% [FY16 – FY18]

Sales CAGR of 10% [FY06 – FY18]

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SOLUTION LINES

Digital DetectorsDynamic detectors

Radiographic detectors

Industrial detectors

X-Ray SourcesMedical X-Ray Tubes

Industrial X-Ray Tubes

Linear Accelerators

Industrial & SecurityIndustrial X-Ray Tubes

Linear Accelerators

Digital Detectors

Industrial Software

High Voltage Connections

High-voltage cables & connectors

Collimators

AECs

Buckys

Mammo Paddle

Connect & Control

Software & ServicesImage processing & diagnostic workstations

3D visualization

Image analysis

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MEDICAL APPLICATIONS

COMPUTED TOMOGRAPHY 3D DENTAL IMAGING DIGITAL RADIOGRAPHYMAMMOGRAPHY & TOMOSYNTHESIS

VETERINARYONCOLOGYCARDIACFLUOROSCOPY

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INDUSTRIAL & SECURITY APPLICATIONS

MATERIAL SCIENCE

NONDESTRUCTIVE TESTING

CARGO SCREENING AT PORTS/BORDERS/AIRPORTS

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CAPITAL STRUCTUREFY2019

$550M 5-Year Credit Facility

• $400M term loan• $150M revolving credit• During FY2018, gross debt outstanding was

reduced by $96M to end at $390M

FY18 Other Data

• Cash and cash equivalents were $52M• Interest rate on fixed debt was 4.2%• Interest rate on floating debt was 4.4%

(Libor plus margin)

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FINANCIAL METRICS

Debt

Net Debt* ($M)

Net Debt Ratio TTM

1Q18 $360 2.99

2Q18 $362 3.04

3Q18 $347 3.05

4Q18 $338 3.23

See: reconciliation between GAAP and adjusted financial measures in appendix of this presentation. *Net Debt is Gross debt less Cash

Operating Metrics

GMOperating Earnings EBITDA Tax Rate

1Q18 34.9% 8% 12% NA2Q18 34.8% 9% 14% NA3Q18 32.9% 4% 16% NA4Q18 29.0% 3% 15% NA

Adjusted Operating Metrics

GMOperating Earnings EBITDA Tax Rate

1Q18 36.3% 10% 13% 26%2Q18 36.0% 12% 15% 22%3Q18 35.1% 10% 13% 24%4Q18 32.5% 10% 13% 25%

$620 $698$773

$0$200$400$600$800

FY16 FY17 FY18

Annual Revenues ($M)

$176$201 $191 $205

$0$50

$100$150$200$250

1Q18 2Q18 3Q18 4Q18

Quarterly Revenues ($M)

$0.30 $0.32

$0.10$0.01

$0.23

$0.45$0.34 $0.29

$0.00

$0.50

1Q'18 2Q'18 3Q'18 4Q'18

Earnings Per Share

EPS Adj EPS

$74 $78$85

$45$56 $65

$0

$50

$100

FY16 FY17 FY18

Cash Flow ($M)

Cash Flow from Operations Free Cash Flow

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ANNUAL FINANCIALS

See reconciliation table

Fiscal Year ($ in millions, except per share data) 2016Revenues Medical 506$ 82% 557$ 80% 602$ 78% Industrial 114 18% 141 20% 171 22% Total revenues 620$ 698$ 773$

Gross Margin Medical 196$ 39% 194$ 35% 191$ 32% Industrial 52 46% 60 43% 63 37% Total gross margin 248$ 40% 254$ 36% 254$ 33% Adjusted gross margin 250$ 40% 264$ 38% 270$ 35%

Operating Expenses Research and development 53$ 9% 67$ 10% 83$ 11% Selling, general and administrative 86 14% 103 15% 126 16% Total operating expenses 139 22% 170 24% 209 27% Operating earnings 109$ 18% 84$ 12% 45$ 6% Adjusted operating earnings 117$ 19% 108$ 15% 82$ 11%

Net Earnings Net earnings 69$ 52$ 28$ Diluted net earnings per share 1.82$ 1.36$ 0.72$

Adjusted net earnings 74$ 68$ 50$ Adjusted diluted net earnings per share 1.96$ 1.80$ 1.30$

Dilutive shares outstanding 37.7 38.0 38.4

Other Data Cash flow from operations 74$ 75$ 85$ Free cash flow 45$ 54$ 65$ Total debt outstanding -$ 484$ 390$

Fiscal Year2017

Fiscal Year2018

Sheet1

Annual Financial Highlights

Fiscal YearFiscal YearFiscal Year

($ in millions, except per share data)201620172018

Revenues

Medical$ 50682%$ 55780%$ 60278%

Industrial11418%14120%17122%

Total revenues$ 620$ 698$ 773

Gross Margin

Medical$ 19639%$ 19435%$ 19132%

Industrial5246%6043%6337%

Total gross margin$ 24840%$ 25436%$ 25433%

Adjusted gross margin$ 25040%$ 26438%$ 27035%

Operating Expenses

Research and development$ 539%$ 6710%$ 8311%

Selling, general and administrative8614%10315%12616%

Total operating expenses13922%17024%20927%

Operating earnings$ 10918%$ 8412%$ 456%

Adjusted operating earnings$ 11719%$ 10815%$ 8211%

Net Earnings

Net earnings$ 69$ 52$ 28

Diluted net earnings per share$ 1.82$ 1.36$ 0.72

Adjusted net earnings$ 74$ 68$ 50

Adjusted diluted net earnings per share$ 1.96$ 1.80$ 1.30

Dilutive shares outstanding37.738.038.4

Other Data

Cash flow from operations$ 74$ 75$ 85

Free cash flow$ 45$ 54$ 65

Total debt outstanding$ - 0$ 484$ 390

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QUARTERLY FINANCIALS

See reconciliation table

FY2018($ in millions, except EPS data) 1Q17 % 2Q17 % 3Q17 % 4Q17 % 1Q18 % 2Q18 % 3Q18 % 4Q18 %Revenues Medical 131.7$ 84% 125.7$ 81% 134.7$ 79% 164.4$ 76% 139.2$ 79% 158.5$ 79% 143.1$ 75% 161.2$ 79% Industrial 25.7 16% 29.1 19% 35.4 21% 51.3 24% 37.0 21% 42.7 21% 48.1 25% 43.6 21% Total revenues 157.4 154.8 170.1 215.7 176.2 201.2 191.2 204.8Gross Margin Medical 47.1 36% 44.6 35% 45.3 34% 56.5 34% 46.4 33% 53.5 34% 45.4 32% 45.2 28% Industrial 11.7 46% 13.0 45% 14.2 40% 21.3 42% 15.1 41% 16.6 39% 17.6 37% 14.1 32% Total gross margin 58.8 37% 57.6 37% 59.5 35% 77.8 36% 61.5 35% 70.1 35% 63.0 33% 59.3 29% Total adjustments, net 0.6 0.6 4.4 5.1 2.4 2.4 4.1 7.3 Adjusted Gross Margin 59.4 38% 58.2 38% 63.9 38% 82.9 38% 63.9 36% 72.5 36% 67.1 35% 66.6 33%Operating Expenses: Research and development 13.3 8% 14.4 9% 17.7 10% 21.9 10% 19.7 11% 22.0 11% 20.5 11% 20.7 10% Selling, general and administrative 26.9 17% 19.7 13% 26.3 15% 29.2 14% 28.2 16% 30.9 15% 35.2 18% 32.2 16% Total operating expenses 40.2 26% 34.1 22% 44.0 26% 51.1 24% 47.9 27% 52.9 26% 55.7 29% 52.9 26%Operating Earnings 18.6 12% 23.5 15% 15.5 9% 26.7 12% 13.6 8% 17.2 9% 7.3 4% 6.4 3% Total adjustments, net 4.6 1.9 8.8 8.8 4.6 6.5 11.9 14.3 Adjusted Operating Earnings 23.2 15% 25.4 16% 24.3 14% 35.5 16% 18.2 10% 23.7 12% 19.2 10% 20.7 10%Interest and other income (expense), net (0.3) (1.1) 0.3 (8.4) (6.5) (1.5) (4.7) (6.1) Earnings before taxes 18.3 22.4 15.8 18.3 7.1 15.7 2.6 0.3 (Benefit) taxes on earnings* 7.1 7.4 5.1 3.2 (4.3) 3.4 (1.3) (0.4) Net earnings 11.2 7% 15.0 10% 10.7 6% 15.1 7% 11.4 6% 12.3 6% 3.9 2% 0.7 0%Less: Net earnings attributable to noncontrolling interests 0.1 - 0.1 0.1 0.1 0.1 0.1 0.5 Net earnings attributable to Varex 11.1$ 7% 15.0$ 10% 10.6$ 6% 15.0$ 7% 11.3$ 6% 12.2$ 6% 3.8$ 2% 0.2$ 0%Net earnings per common share attributable to VarexBasic 0.30$ 0.40$ 0.28$ 0.40$ 0.30$ 0.32$ 0.10$ 0.01$ Diluted 0.29$ 0.40$ 0.28$ 0.39$ 0.30$ 0.32$ 0.10$ 0.01$

Adjusted Net Earnings 13.9$ 9% 16.3$ 11% 16.6$ 10% 22.3$ 10% 8.6$ 5% 17.3$ 9% 12.9$ 7% 10.9$ 5%Adjusted Diluted Net Earnings per share 0.37$ 0.43$ 0.44$ 0.59$ 0.23$ 0.45$ 0.34$ 0.29$

Weighted Average common shares outstandingBasic 37.4 37.5 37.6 37.6 37.7 37.8 37.9 38.0 Diluted 37.7 37.8 38.0 38.0 38.2 38.4 38.4 38.4

FY2017

Sheet1

FY2017FY2018

($ in millions, except EPS data)1Q17%2Q17%3Q17%4Q17%1Q18%2Q18%3Q18%4Q18%

Revenues

Medical$ 131.784%$ 125.781%$ 134.779%$ 164.476%$ 139.279%$ 158.579%$ 143.175%$ 161.279%

Industrial25.716%29.119%35.421%51.324%37.021%42.721%48.125%43.621%

Total revenues157.4154.8170.1215.7176.2201.2191.2204.8

Gross Margin

Medical47.136%44.635%45.334%56.534%46.433%53.534%45.432%45.228%

Industrial11.746%13.045%14.240%21.342%15.141%16.639%17.637%14.132%

Total gross margin58.837%57.637%59.535%77.836%61.535%70.135%63.033%59.329%

Total adjustments, net0.60.64.45.12.42.44.17.3

Adjusted Gross Margin59.438%58.238%63.938%82.938%63.936%72.536%67.135%66.633%

Operating Expenses:

Research and development13.38%14.49%17.710%21.910%19.711%22.011%20.511%20.710%

Selling, general and administrative26.917%19.713%26.315%29.214%28.216%30.915%35.218%32.216%

Total operating expenses40.226%34.122%44.026%51.124%47.927%52.926%55.729%52.926%

Operating Earnings18.612%23.515%15.59%26.712%13.68%17.29%7.34%6.43%

Total adjustments, net4.61.98.88.84.66.511.914.3

Adjusted Operating Earnings23.215%25.416%24.314%35.516%18.210%23.712%19.210%20.710%

Interest and other income (expense), net(0.3)(1.1)0.3(8.4)(6.5)(1.5)(4.7)(6.1)

Earnings before taxes18.322.415.818.37.115.72.60.3

(Benefit) taxes on earnings*7.17.45.13.2(4.3)3.4(1.3)(0.4)

Net earnings11.27%15.010%10.76%15.17%11.46%12.36%3.92%0.70%

Less: Net earnings attributable to

noncontrolling interests0.1-0.10.10.10.10.10.5

Net earnings attributable to Varex$ 11.17%$ 15.010%$ 10.66%$ 15.07%$ 11.36%$ 12.26%$ 3.82%$ 0.20%

Net earnings per common share attributable to Varex

Basic$ 0.30$ 0.40$ 0.28$ 0.40$ 0.30$ 0.32$ 0.10$ 0.01

Diluted$ 0.29$ 0.40$ 0.28$ 0.39$ 0.30$ 0.32$ 0.10$ 0.01

Adjusted Net Earnings$ 13.99%$ 16.311%$ 16.610%$ 22.310%$ 8.65%$ 17.39%$ 12.97%$ 10.95%

Adjusted Diluted Net Earnings per share$ 0.37$ 0.43$ 0.44$ 0.59$ 0.23$ 0.45$ 0.34$ 0.29

Weighted Average common shares outstanding

Basic37.437.537.637.637.737.837.938.0

Diluted37.737.838.038.038.238.438.438.4

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RECONCILIATION BETWEEN GAAP AND ADJUSTED FINANCIAL MEASURES (UNAUDITED)

($ in millions, except per share amounts) September 28, 2018 September 29, 2017 September 28, 2018 September 29, 2017GROSS MARGIN RECONCILIATIONRevenues 204.8$ 215.7$ 773.4$ 698.1$ Gross margin 59.3$ 77.8$ 253.9$ 253.5$ Amortization of intangible assets 1.9 2.4 8.9 5.3 Restructuring charges (includes restructuring and inventory markdown impacts on cost of revenues) 4.2 — 4.2 — Inventory markdowns resulting from restructuring plan 1.2 — 3.1 — Purchase price accounting adjustments — 2.7 — 5.2 Adjusted gross margin 66.6$ 82.9$ 270.1$ 264.0$ Gross margin % 29.0% 36.1% 32.8% 36.3%Adjusted gross margin % 32.5% 38.4% 34.9% 37.8%

OPERATING EARNINGS RECONCILIATIONOperating Earnings 6.4$ 26.7$ 44.5$ 83.7$ Amortization of intangibles (includes amortization impacts to cost of revenues) 3.7 4.4 16.2 10.5 Purchase price accounting adjustments — 2.7 — 5.2 Separation and related costs 1.1 — 1.1 3.0 Restructuring charges (includes restructuring and inventory markdown impacts to cost of revenues) 7.9 — 13.7 0.1 Acquisition and integration related costs 1.6 1.7 3.1 5.0 Impairment charges — — 3.0 — Other non-operational costs — — 0.2 1.7 Total operating earnings adjustments 14.3$ 8.8$ 37.3$ 24.1$ Adjusted operating earnings 20.7$ 35.5$ 81.8$ 107.8$ Operating earnings margin 3.1% 12.4% 5.8% 12.0%Adjusted operating earnings margin 10.1% 16.4% 10.6% 15.4%

NET EARNINGS AND DILUTED NETEARNINGS PER SHARE RECONCILIATIONNet earnings attributable to Varex 0.2$ 15.0$ 27.5$ 51.6$ Total operating earnings adjustments 14.3$ 8.8$ 37.3$ 24.1$ Estimated annual effective tax rate(1) 25.3% 17.5% 24.1% 30.5% Tax effects of operating earnings adjustments 3.6$ 1.5$ 9.0$ 7.4$ Non-operational tax adjustments — — 6.1$ —Adjusted net earnings 10.9$ 22.3$ 49.7$ 68.3$ Diluted net earnings per share 0.01$ 0.39$ 0.72$ 1.36$ Adjusted diluted net earnings per share 0.29$ 0.59$ 1.30$ 1.80$ Dilutive shares 38.4 38.0 38.4 38.0

(1) Annual effective tax rate applied for the three and twelve-month period ended September 28, 2018 excludes discrete items.

Three Months Ended Twelve Months Ended

Sheet1

Three Months EndedTwelve Months Ended

($ in millions, except per share amounts)September 28, 2018September 29, 2017September 28, 2018September 29, 2017

GROSS MARGIN RECONCILIATION

Revenues$ 204.8$ 215.7$ 773.4$ 698.1

Gross margin$ 59.3$ 77.8$ 253.9$ 253.5

Amortization of intangible assets1.92.48.95.3

Restructuring charges (includes restructuring

and inventory markdown impacts on cost

of revenues)4.2—4.2—

Inventory markdowns resulting from

restructuring plan1.2—3.1—

Purchase price accounting adjustments—2.7—5.2

Adjusted gross margin$ 66.6$ 82.9$ 270.1$ 264.0

Gross margin %29.0%36.1%32.8%36.3%

Adjusted gross margin %32.5%38.4%34.9%37.8%

OPERATING EARNINGS RECONCILIATION

Operating Earnings$ 6.4$ 26.7$ 44.5$ 83.7

Amortization of intangibles (includes

amortization impacts to cost of revenues)3.74.416.210.5

Purchase price accounting adjustments—2.7—5.2

Separation and related costs1.1—1.13.0

Restructuring charges (includes restructuring

and inventory markdown impacts to cost

of revenues)7.9—13.70.1

Acquisition and integration related costs1.61.73.15.0

Impairment charges——3.0—

Other non-operational costs——0.2$ 0.31.7

Total operating earnings adjustments$ 14.3$ 8.8$ 37.3$ 24.1

Adjusted operating earnings$ 20.7$ 35.5$ 81.8$ 107.8

Operating earnings margin3.1%12.4%5.8%12.0%

Adjusted operating earnings margin10.1%16.4%10.6%15.4%

NET EARNINGS AND DILUTED NET

EARNINGS PER SHARE RECONCILIATION

Net earnings attributable to Varex$ 0.2$ 15.0$ 27.5$ 51.6

Total operating earnings adjustments$ 14.3$ 8.8$ 37.3$ 24.1

Estimated annual effective tax rate(1)25.3%17.5%24.1%30.5%

Tax effects of operating earnings adjustments$ 3.6$ 1.5$ 9.0$ 7.4

Non-operational tax adjustments——$ 6.1—

Adjusted net earnings$ 10.9$ 22.3$ 49.7$ 68.3

Diluted net earnings per share$ 0.01$ 0.39$ 0.72$ 1.36

Adjusted diluted net earnings per share$ 0.29$ 0.59$ 1.30$ 1.80

Dilutive shares38.438.038.438.0

(1) Annual effective tax rate applied for the three and twelve-month period ended September 28, 2018 excludes discrete items.

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DISCUSSION OF ADJUSTED NON-GAAP FINANCIAL MEASURESThis presentation includes adjusted non-GAAP financial measures derived from our Condensed Consolidated Statements of Earnings. These measures are not presented in accordance with, nor are they a substitute for U.S. generally accepted accounting principles, or GAAP. These adjusted measures include: adjusted gross margin; adjusted operating earnings; adjusted operating earnings margin; adjusted net earnings; and adjusted net earnings per diluted share. We are providing a reconciliation above of each adjusted financial measure used in this earnings release to the most directly comparable GAAP financial measure. We are unable to provide without unreasonable effort a reconciliation of adjusted guidance measures to the corresponding GAAP measures on a forward-looking basis due to the potential significant variability and limited visibility of the excluded items discussed.

We utilize a number of different financial measures, both GAAP and adjusted, in analyzing and assessing the overall performance of our business, in making operating decisions, and forecasting and planning for future periods. We consider the use of the adjusted measures to be helpful in assessing the performance of the ongoing operation of our business by excluding unusual and one-time costs. We believe that disclosing adjusted financial measures provides useful supplemental data that allows for greater transparency in the review of our financial and operational performance. We also believe that disclosing adjusted financial measures provides useful information to investors and others in understanding and evaluating our operating results and future prospects in the same manner as management and in comparing financial results across accounting periods and to those of peer companies.

Adjustments to GAAP measures include the following items:

Amortization of intangible assets: We do not acquire businesses and assets on a predictable cycle. The amount of purchase price allocated to intangible assets and the term of amortization can vary significantly and are unique to each acquisition or purchase. We believe that excluding amortization of intangible assets allows the users of our financial statements to better review and understand the historic and current results of our operations, and also facilitates comparisons to peer companies.

Purchase price accounting charges to cost of revenues: We may incur charges to cost of revenues as a result of acquisitions. We believe that excluding these charges allows the users of our financial statements to better understand the historic and current cost of our products, our gross margin, and also facilitates comparisons to peer companies.

Separation and related costs: We separated from Varian Medical Systems on January 28, 2017 and incurred non-operational expenses associated with the separation. We believe that excluding separation costs allows the users of our financial statements to better understand the historic and current results of our operations, and also facilitates comparisons to peer companies.

Restructuring charges: We incur restructuring charges that result from events, which arise from unforeseen circumstances and/or often occur outside of the ordinary course of our on-going business. Although these events are reflected in our GAAP financials, these unique transactions may limit the comparability of our on-going operations with prior and future periods.

Acquisition and integration related costs: We incur expenses or benefits with respect to certain items associated with our acquisitions, such as transaction costs, changes in the fair value of contingent consideration liabilities, gain or expense on settlement of pre-existing relationships, etc. We exclude such expenses or benefits as they are related to acquisitions and have no direct correlation to the operation of our on-going business. We also incur expenses or benefits with respect to certain items associated with our acquisitions, such as integration costs relating to acquisitions for any costs incurred prior to closing and up to 12 months after the closing date of the acquisition.

Impairment charges: We may incur impairment charges that result from events, which arise from unforeseen circumstances and/or often occur outside of the ordinary course of our on-going business and such charges may limit the comparability of our on-going operations with prior and future periods.

Non-operational tax adjustments: Certain tax items may be non-recurring, unusual, infrequent and directly related to an event that is distinct and non-reflective of the Company’s normal business operations, including the enactment of the Tax Cuts and Jobs Act in December 2017. These may include such items as the retroactive impact of significant changes in tax laws, including changes to statutory tax rates and one-time tax charges.

Other non-operational costs: Certain items may be non-recurring, unusual, infrequent and directly related to an event that is distinct and non-reflective of the Company’s normal business operations. These may include such items as legal settlements, environmental settlements, governmental settlements including tax settlements and other items of similar nature.

Tax effects of operating earnings adjustments: We apply our GAAP consolidated effective tax rate to our adjusted financial measures as our historical annual consolidated effective tax rate has remained fairly consistent, and is expected to remain consistent for the foreseeable future. This application of our effective tax rate excludes any discrete items, as defined in the guidance for accounting for income taxes in interim periods, such as those related to tax reform or any other Non-Operational Tax Adjustments.

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VAREX 2017SUSTAINABILITYREPORTOur innovative business comes with important responsibilities. To improve transparency and drive continuous improvement, we recently published our first Sustainability Report.

The report is designed to meet Global Reporting Initiative (GRI) best practice standards in sustainability reporting. It describes our Sustainability Strategy and targets and summarizes our key achievements for the period January 1, 2017 to December 31, 2017.

Download the full report at www.vareximaging.com/sustainability. We would love to hear what you think.

OUR STRATEGY

Our Sustainability Strategy aims to embed sustainability in every part of our business. It is focused on the four areas where we can have the greatest positive impact.

HELPING SECURE

A HEALTHIER, SAFER FUTURE

PROTECTING THE ENVIRONMENT

Minimizing our environmental

footprint and supporting

the transitionto a circular

economy

INSPIRING INNOVATION

Innovating with our customers for a healthier, safer future

ACTING WITH INTEGRITY

Building a trusted and responsible business

EMPOWERING PEOPLE AND

COMMUNITIESInvesting in human potential and thriving communities

http://www.vareximaging.com/sustainability

Slide Number 1FORWARD-LOOKING STATEMENTSSlide Number 3FINANCIAL �SUMMARYTWO PRIMARY MARKETSHOW WE WIN IN�MEDICAL HOW WE WIN IN�INDUSTRIAL & SECURITY Slide Number 8GROWTH DRIVER: �China’s Healthcare Reform InitiativesSlide Number 10ACQUISITION GROWTHRESTRUCTURINGTARIFFSOUTLOOK – FY2019*LONG-TERM VIEWINVESTMENT HIGHLIGHTSSlide Number 17Slide Number 18MEDICAL APPLICATIONSINDUSTRIAL & SECURITY APPLICATIONSSlide Number 21FINANCIAL �METRICSANNUAL FINANCIALSQUARTERLY FINANCIALSRECONCILIATION BETWEEN GAAP AND ADJUSTED FINANCIAL MEASURES (UNAUDITED)DISCUSSION OF ADJUSTED NON-GAAP FINANCIAL MEASURESSlide Number 27