BILLERICA, Mass., April 28 /PRNewswire-FirstCall/ -- GSI Lumonics Inc.,
(Nasdaq: GSLI and TSX: GSI), a major supplier of precision motion components,
lasers and laser systems, today announced financial results for the first
quarter ended April 1, 2005. (All data are expressed in U.S. GAAP and in U.S.
dollars.)
First quarter results:
-- Sales were $64.8 million for the first quarter of 2005, compared to
$74.9 million for the same period in 2004, a decrease of 13%
-- Net income was $0.1 million or $0.00 per diluted share for the first
quarter, compared to net income of $8.9 million or $0.21 per diluted
share for the same period last year.
-- Bookings were $62.4 million for the quarter, a decrease of $25.9
million from the same period in 2004.
-- Backlog was $58.9 million at the end of the first quarter, compared to
$92.0 million for the same period in 2004, a decrease of 36%.
-- Gross margin for the quarter just ended was 35.4% of sales, as compared
to 39.7 % for the same period in 2004.
-- Cash flow utilized in operations was $1.2 million for the first
quarter as compared to $6.5 million generated in the same quarter in
2004.
-- Cash, cash equivalents and marketable short and long-term investments
totaled $87.3 million as of April 1, 2005.
Geographically, sales for the first quarter of 2005 were as follows:
approximately 39% in the Americas, 44% in Asia-Pacific, including Japan, and
17 % in Europe. For the same period in 2004, sales were distributed as
follows: 52% in the Americas, 30% in Asia-Pacific, including Japan, and 18% in
Europe.
Margins were unfavorably impacted by lower volume and generally non-
recurring or unusual expenses in the quarter. The non-recurring costs included
severance pay of $0.5 million, and a provision for a European customs issue
of $0.4 million. Also during the quarter was an additional inventory
obsolescence provision of $0.5 million, as compared to the same quarter last
year that included a benefit of $0.6 million for sales of inventory that had
previously been written down. Sales and General Administrative expenses were
higher than the same quarter last year due primarily to the MicroE
acquisition.
The Company has returned to a normal annualized effective tax rate of
approximately 37% for the fiscal year 2005.
"We are disappointed in these financial results," said Charles Winston,
President and CEO of GSI Lumonics. "Unexpected delivery delays requested by
customers within the Laser Systems segment, combined with some non-recurring
costs, were the prime causes. We look for improvement in the next quarter."
Business Segment Reporting
The Components segment reported sales of $34.0 million for the first
quarter 2005 as compared to $33.4 million for the same period last year. This
quarter includes $5.7 million in additional revenue from MicroE Systems, which
was acquired subsequent to the same quarter last year. Operating income was
$3.3 million for the first quarter 2005, a decrease of $1.8 million from the
same quarter 2004. Gross margin was 36.9% compared to 33.9% in the first
quarter of 2004. The improvement in margin is attributed primarily to the
addition of MicroE.
The Laser Systems segment reported sales of $22.0 million, as compared to
$34.0 million during the same quarter last year. The segment contributed an
operating profit of $1.6 million for the first quarter 2005, as compared to
$9.5 million in the same period last year. Gross margin was 35.4% in the first
quarter of 2005, as compared to 45.4% during the fourth quarter 2004. Margins
declined due to lower volume of sales and higher costs from warranty and
inventory obsolescence.
The Laser segment reported sales of $10.3 million, compared to $11.7
million during the same quarter. The segment had an operating loss of $0.7
million in the first quarter 2005 versus $0.4 million operating income in the
same period last year, which is a decrease of $1.1 million. Gross margin was
25.4% as compared to 28.1% during the same period last year.
Financial Condition
At April 1, 2005 cash, cash equivalents and marketable short-term and
long-term investments totaled $87.3 million, compared to $90.3 million at
December 31, 2004. The Company continues to operate debt-free. Cash flow
utilized in operations was $1.2 million for the first quarter in 2005 as
compared to $6.5 million provided in cash during the same period last year.
GSI Lumonics will host a conference call for investors at 6:00 p.m.
Eastern Time. To participate, call 800-591-6942 (within the US and Canada) and
617-614-4909 (for international callers) no earlier than 5:50 p.m. Eastern
Time and no later than 5:55 p.m. Eastern Time and identify yourself to the
operator with the participant code of 10112209. A replay of the call will be
available one hour after the call ends to midnight, May 5, 2005 by dialing
888-286-8010 (within the US and Canada) or 617-801-6888 (for international
callers). The access code is 36333377.
The conference call also will be broadcast live over the Internet in
listen-only mode. For live webcasting, go to:
http://phx.corporate-ir.net/phoenix.zhtml?p=irol-
eventDetails&c=75037&eventID=1020123 at least 15 minutes prior to the call in
order to register, download and install any necessary software. The call will
be archived on the above web site until midnight, May 5, 2005.
GSI Lumonics supplies precision motion control components, lasers and
laser-based advanced manufacturing systems to the global medical,
semiconductor, electronics, and industrial markets. GSI Lumonics' common
shares are listed on Nasdaq (GSLI) and The Toronto Stock Exchange (GSI).
Certain statements in this news release may constitute forward-looking
statements within the meaning of the United States Private Securities
Litigation Reform Act of 1995, Section 27A of the United States Securities Act
of 1933 and Section 21E of the United States Securities Exchange Act of 1934.
These forward-looking statements may relate to anticipated financial
performance, management's plans and objectives for future operations, business
prospects, outcome of regulatory proceedings, market conditions, tax issues
and other matters. All statements contained in this news release that do not
relate to matters of historical fact should be considered forward-looking
statements, and are generally identified by words such as "anticipate,"
"believe," "estimate," "expect," "intend," "plan," "objective" and other
similar expressions. Readers should not place undue reliance on the forward-
looking statements contained in this news release. Such statements are based
on management's beliefs and assumptions and on information currently available
to management and are subject to risks, uncertainties and changes in
condition, significance, value and effect. Other risks include the fact that
the Company's sales have been and are expected to continue to be dependent
upon customer capital equipment expenditures, which are, in turn, affected by
business cycles in the markets served by those customers. Other factors
include volatility in the semiconductor industry, the risk of order delays and
cancellations, the risk of delays by customers in introducing their new
products and market acceptance of products incorporating subsystems supplied
by the Company, similar risks to the Company of delays in its new products,
our ability to continue to reduce costs and capital expenditures, our ability
to focus R&D investment and integrate acquisitions and other risks detailed in
reports and documents filed by the Company with the United States Securities
and Exchange Commission and with securities regulatory authorities in Canada.
Such risks, uncertainties and changes in condition, significance, value and
effect, many of which are beyond the Company's control, could cause the
Company's actual results and other future events to differ materially from
those anticipated. The Company does not, however, assume any obligation to
update these forward-looking statements to reflect actual results, changes in
assumptions or changes in other factors affecting such forward-looking
statements.
For more information contact: Investor Relations, 613-224-4868, Ann
Dempsey, (ext. 2#)
GSI LUMONICS INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(U.S. GAAP and in thousands of U.S. dollars, except share amounts)
April 1, December 31,
2005 2004
ASSETS
Current
Cash and cash equivalents $74,360 $82,334
Short-term investments 7,959 2,995
Accounts receivable, less allowance
of $1,500 (December 31, 2004 - $2,470) 53,341 60,314
Income taxes receivable 3,665 2,287
Inventories 62,783 60,319
Deferred tax assets 14,897 13,094
Other current assets 8,130 10,311
Total current assets 225,135 231,654
Property, plant and equipment,
net of accumulated depreciation
of $27,889 (December 31, 2004 - $26,604) 48,558 50,220
Deferred tax assets 16,696 18,364
Other assets 2,775 2,906
Long-term investments 5,667 5,681
Intangible assets, net of amortization
of $2,581 (December 31, 2004 - $2,139) 17,571 18,152
Patents and acquired technology,
net of amortization of $27,145
(December 31, 2004 - $25,883) 31,396 32,837
Goodwill 26,350 26,350
$374,148 $386,164
LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable $16,176 $18,462
Income taxes payable 1,959 4,045
Accrued compensation and benefits 9,891 13,160
Other accrued expenses 19,088 21,327
Total current liabilities 47,114 56,994
Deferred compensation 2,702 2,178
Deferred tax liabilities 11,201 11,521
Other liability 83 27
Accrued minimum pension liability 9,860 9,881
Total liabilities 70,960 80,601
Commitments and contingencies
Stockholders' equity
Common shares, no par value; Authorized shares:
unlimited; Issued and outstanding:
41,489,107 (December 31, 2004 - 41,449,270) 308,859 308,669
Additional paid-in capital 3,227 3,289
Accumulated deficit (1,859) (1,969)
Accumulated other comprehensive loss (7,039) (4,426)
Total stockholders' equity 303,188 305,563
$374,148 $386,164
GSI LUMONICS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(U.S. GAAP and in thousands of U.S. dollars, except share amounts)
Three Months Ended
April 1, April 2,
2005 2004
Sales $64,841 $74,853
Cost of goods sold 41,893 45,113
Gross profit 22,948 29,740
Operating expenses:
Research and development 6,460 4,759
Selling, general and administrative 15,380 13,484
Amortization of purchased intangibles 1,752 1,549
Other 197 -
Total operating expenses 23,789 19,792
Income (loss) from operations (841) 9,948
Loss on sale of investments - (15)
Interest income 392 179
Interest expense 4 (28)
Foreign exchange transaction gains (losses) 618 (260)
Income before income taxes 173 9,824
Income tax provision 63 885
Net income $110 $8,939
Net income per common share:
Basic $0.00 $0.22
Diluted $0.00 $0.21
Weighted average common shares outstanding
(000's) 41,464 40,951
Weighted average common shares outstanding
for diluted net income per common share
(000's) 41,825 42,114
GSI LUMONICS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(U.S. GAAP and in thousands of U.S. dollars, except share amounts)
Three Months Ended
April 1, April 2,
2005 2004
Cash flows from operating activities:
Net income $110 $8,939
Adjustments to reconcile net income to
net cash provided by operating activities:
Loss on sale of investments - 15
Loss on long lived asset 197 -
Depreciation and amortization 3,578 3,746
Unrealized loss on derivatives 56 -
Stock-based compensation (62) 51
Deferred income taxes (398) (2,570)
Changes in current assets and liabilities:
Accounts receivable 6,264 (9,159)
Inventories (3,063) (6,881)
Other current assets 2,027 564
Accounts payable, accruals, taxes
(receivable) payable and other liabilities (9,896) 11,783
Cash (used in) provided by operating activities (1,187) 6,488
Cash flows from investing activities:
Additions to property, plant and equipment (898) (277)
Proceeds from the sale and maturities
of investments 3,000 47,620
Purchases of investments (7,976) (26,491)
Decrease in other assets 102 3
Cash (used in) provided by investing activities (5,772) 20,855
Cash flows from financing activities:
Issue of share capital from the exercise
of stock options 191 328
Cash provided by financing activities 191 328
Effect of exchange rates on cash and cash
equivalents (1,206) 291
(Decrease) increase in cash and cash equivalents (7,974) 27,962
Cash and cash equivalents, beginning of period 82,334 64,035
Cash and cash equivalents, end of period $74,360 $91,997
GSI LUMONICS INC.
Consolidated Analysis By Segment (unaudited)
(thousands of U.S. dollars)
Three months ended
Sales: April 1, 2005 April 2, 2004
Components $33,985 $33,357
Laser Group 10,261 11,699
Laser Systems 22,004 34,003
Intersegment sales elimination (1,409) (4,206)
Total $64,841 $74,853
Gross profit %:
Components 36.9% 33.9%
Laser Group 25.4 28.1
Laser Systems 35.4 45.4
Intersegment sales elimination (0.8) 7.4
Total 35.4% 39.7%
Segment income (loss) from operations:
Components $3,297 $5,093
Laser Group (711) 364
Laser Systems 1,623 9,534
Total by segment 4,209 14,991
Unallocated amounts:
Corporate expenses 4,827 4,183
Amortization of purchased intangibles
not allocated to a segment 26 860
Other 197 -
Income (loss) from operations $(841) $9,948
GSI LUMONICS INC.
Consolidated Sales Analysis By Geographic Region (unaudited)
(millions of U.S. dollars)
Three months ended
April 1, 2005 April 2, 2004
Sales % ofTotal Sales % ofTotal
North America $25.0 39% $38.8 52%
Latin and South America 0.4 - 0.1 -
Europe (EMEA) 11.1 17 13.5 18
Japan 13.7 21 11.5 15
Asia-Pacific 14.6 23 11.0 15
Total $64.8 100% $74.9 100%
SOURCE GSI Lumonics Inc.
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Company News On-Call:
http://www.prnewswire.com/comp/107189.html
CONTACT:
Ann Dempsey, Investor Relations of GSI
Lumonics Inc., +1-613-224-4868 ext. 2#
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