SANTA CLARA, Calif., July 27 /PRNewswire-FirstCall/ -- Coherent, Inc.
(Nasdaq: COHR) today announced financial results for its third fiscal quarter
ended July 3, 2004, posting sales of $128.0 million and income from continuing
operations of $5.2 million ($0.17 per diluted share). Net income from
continuing operations included a gain of $0.7 million ($0.02 per diluted
share) from the sale of certain technology.
Sales and net loss from continuing operations for the corresponding prior
year quarter were $99.2 million and $2.3 million ($0.08 per diluted share),
respectively. In comparison, sales for the immediately preceding quarter's
results were $125.8 million and income from continuing operations was
$2.9 million ($0.09 per diluted share).
Orders received during the quarter ended July 3, 2004 were $124.9 million,
representing a 21% increase over the prior year quarter and a 9% decrease from
orders received in the immediately preceding quarter. Backlog of $155.1
million at July 3, 2004 compared to a backlog of $158.1 million at April 3,
2004.
John Ambroseo, Coherent's President and Chief Executive Officer commented,
"We are encouraged by a number of positive trends during the third quarter.
Sales and orders to the microelectronics market remained strong, while new
application development bodes well for future growth. Orders and sales for
standard products in the international scientific market were softer than
anticipated. We are also pleased by the continued improvement in gross margin
as the Electro-Optics segment has reached its goal of 45% one quarter ahead of
schedule. The total Company gross margin of 43.0% was the highest level in
the past ten quarters."
Year-to-date sales of $361.7 million and net income of $8.0 million
($0.26 per diluted share) compared to the prior year period sales of
$304.7 million and a net loss of $20.8 million ($0.71 per share). Orders
received for the nine month period ended July 3, 2004 were $389.1 million,
representing a 29% increase over orders received in the same period last year.
Electro-Optics segment sales of $105.5 million for the three months ended
July 3, 2004 were 27% higher than sales during the comparable prior year
period and 1% higher than the three months ended April 3, 2004. Incoming
orders of $103.4 million represent a 21% improvement over the third fiscal
quarter of 2003, and a decrease of 5% from orders received in the immediately
preceding quarter. Sales and incoming orders for the nine months ended July
3, 2004 were $300.1 million and $319.2 million, 25% and 28% higher,
respectively, than during the same period a year ago.
Lambda Physik segment sales of $22.5 million for the three months ended
July 3, 2004 represent a 42% increase from the corresponding prior year
period, and a 3% increase from the immediately preceding quarter. Incoming
orders of $21.5 million for the third quarter of fiscal 2004 were 18% higher
than the third fiscal quarter of 2003, and represent a 24% decrease in orders
from the immediately preceding second fiscal quarter. Sales and incoming
orders for the nine months ended July 3, 2004 were $61.6 million and
$69.9 million, respectively, and were 4% lower and 35% higher than the same
period last year.
Ambroseo continued, "Subsequent to quarter end, Lambda Physik introduced
the LithoTex(TM), its new high power 193nm excimer laser for the semiconductor
lithography market. This was a significant accomplishment given the amount of
engineering involved and the time constraints we were up against. I commend
all those individuals who helped deliver this breakthrough technology on time
as promised."
Summarized statement of operations financial information is as follows
(unaudited, in thousands except per share data):
Three Months Ended Nine Months Ended
July 3, April 3, June 28, July 3, June 28,
2004 2004 (A) 2003 2004 (A) 2003
Net sales (B) $127,951 $125,808 $99,174 $361,710 $304,716
Cost of sales (C) 72,964 74,235 62,225 213,716 186,333
Gross profit 54,987 51,573 36,949 147,994 118,383
Operating expenses:
Research & development 15,505 15,538 12,694 45,964 36,627
Purchased research
& development -- -- 4,430 -- 4,430
Selling, general
& administrative 28,626 29,132 25,437 83,716 75,024
Restructuring, impairment
and other charges (D) 18 -- 289 255 20,753
Goodwill impairment (E) -- -- -- -- 2,358
Intangibles amortization 1,504 1,770 1,397 5,203 3,179
Total operating
expenses 45,653 46,440 44,247 135,138 142,371
Income (loss) from
operations 9,334 5,133 (7,298) 12,856 (23,988)
Other income (expense),
net (F) (G) (H) 350 174 330 942 (4,644)
Income (loss) from
continuing operations
before income taxes and
minority interest 9,684 5,307 (6,968) 13,798 (28,632)
Provision (benefit) for
income taxes 4,261 2,567 (3,576) 6,274 (6,893)
Income (loss) from
continuing operations
before minority interest 5,423 2,740 (3,392) 7,524 (21,739)
Minority interest (B) (269) 145 1,106 209 897
Income (loss) from
continuing operations 5,154 2,885 (2,286) 7,733 (20,842)
Income from discontinued
operations -- 218 -- 218 --
Net income (loss) $5,154 $3,103 $(2,286) $7,951 $(20,842)
Net income (loss) per
diluted share:
Income (loss) from
continuing operations $0.17 $0.09 $(0.08) $0.25 $(0.71)
Income from discontinued
operations, net of
income taxes -- 0.01 -- 0.01 --
Net income (loss) $0.17 $0.10 $(0.08) $0.26 $(0.71)
Shares used in computation:
Basic 30,243 30,121 29,537 30,122 29,312
Diluted 30,620 30,551 29,537 30,502 29,312
(A) The three months ended April 3, 2004 and the nine months ended July 3,
2004 represent a 14-week and 40-week period, respectively.
(B) The quarter ended July 3, 2004 includes $2,181 of net sales and orders
from an entity consolidated under FIN 46R. Additionally, this
entity's net income of $380 for the quarter ended July 3, 2004 was
eliminated through minority interest.
(C) Cost of sales in the quarter ended March 29, 2003 included an
additional inventory reserve requirement of $2,743 ($1,220 after-tax
and net of minority interest ($0.04 per diluted share)) due to lower
forecasted outlook in Lambda Physik's lithography business.
(D) The quarter ended December 28, 2002 includes a $13,378
($8,288 after-tax ($0.28 per diluted share)) charge related to the
termination of activities in the Telecom Actives Group, a
$3,060 ($2,672 after-tax ($0.09 per diluted share)) charge related to
our exit from the passive telecom market and a $3,723
($2,306 after-tax ($0.08 per diluted share)) allowance against a note
receivable.
(E) Goodwill impairment charges in the quarter ended March 29, 2003 were
$2,358 ($1,769 net of minority interest ($0.06 per diluted share)).
(F) The quarter ended December 28, 2002 includes an impairment charge on
the Lumenis shares held by Coherent of $10,212 ($10,212 after-tax
($0.35 per diluted share)).
(G) The quarter ended March 29, 2003 includes a $4,400 ($1,953 after-tax
and net of minority interest ($0.07 per diluted share)) settlement fee
related to the cancellation of a customer contract received by Lambda
Physik.
(H) The quarter ended July 3, 2004 includes a $1,200 ($663 after-tax
($0.02 per diluted share)) gain on the sale of certain technology.
Summarized balance sheet information is as follows (unaudited, in
thousands):
Jul. 3, Sept. 27,
2004 2003 (A)
ASSETS
Current assets:
Cash, cash equivalents and short-term
investments $153,988 $134,671
Restricted cash, cash equivalents and
short-term investments (B) 15,324 15,284
Short-term equity investments -- 277
Accounts receivable, net 88,409 73,118
Inventories 107,045 100,147
Prepaid expenses and other assets 66,816 75,485
Total current assets 431,582 398,982
Property and equipment, net 167,708 146,399
Restricted cash, cash equivalents and
short-term investments (B) 23,756 38,660
Other assets 121,227 125,324
Total assets $744,273 $709,365
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations $14,039 $14,140
Accounts payable 20,622 17,632
Other current liabilities 72,291 69,341
Total current liabilities 106,952 101,113
Long-term obligations 14,505 27,911
Other long-term liabilities 46,743 36,483
Total stockholders' equity 576,073 543,858
Total liabilities and stockholders' equity $744,273 $709,365
(A) Derived from audited financial statements for the year ended
September 27, 2003.
(B) Represents cash, cash equivalents and short-term investments at
July 3, 2004 restricted under the Star Medical notes payable
arrangement ($30,363), for the purchase of the remaining outstanding
shares of Lambda Physik AG ($8,298) and other ($419).
Reconciliation of GAAP to Non-GAAP summarized statement of operations
(unaudited, in thousands, after-tax and net of minority interest):
Three Months Ended Nine Months Ended
July 3, April 3, June 28, July 3, June 28,
2004 2004 2003 2004 2003
GAAP net income (loss) $5,154 $3,103 $(2,286) $7,951 $(20,842)
Sale of technology (663) -- -- (663) --
In-process research and
development -- -- 4,430 -- 4,430
Gain on sale of Lumenis
investment -- -- (1,479) -- (1,479)
Tax benefit for refund of
prior year taxes -- -- (908) -- (908)
Gain on contract settlements (1) -- -- -- -- (1,953)
Goodwill impairment (2) -- -- -- -- 1,769
Restructuring, impairment
and other charges -- -- -- 142 13,266
Write-down of Lumenis investment -- -- -- -- 10,212
Discontinued operations -- (218) -- (218) --
Non-GAAP net income (loss) $4,491 $2,885 $(243) $7,212 $4,495
Non-GAAP net income (loss)
per diluted share $0.15 $0.09 $(0.01) $0.24 $0.15
(1) Net of minority interest of ($1,015).
(2) Net of minority interest of $589.
The Company's conference call scheduled for 1:30 p.m. PDT today will
include discussions relative to the current quarter results and some comments
regarding forward looking guidance on future operating performance.
The statements in this press release that relate to future plans, events
or performance, including statements such as we are encouraged by a number of
positive trends during the third quarter and new application development bodes
well for future growth are forward-looking statements. Factors that could
cause actual results to differ materially include risks and uncertainties,
including risks associated to currency adjustments, contract cancellations,
manufacturing risks, competitive factors, and uncertainties pertaining to
customer orders, demand for products and services, and development of markets
for the Company's products and services and other risks identified in the
Company's SEC filings. Actual results, events and performance may differ
materially. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof. The
Company undertakes no obligation to update these forward-looking statements as
a result of events or circumstances after the date hereof or to reflect the
occurrence of unanticipated events.
The Company may provide non-GAAP financial measures (as defined by the SEC
in Regulation G) in our earnings conference call and in any other company
presentations during the quarter. Non-GAAP financial measures are intended to
supplement the user's overall understanding of the Company's current financial
performance and its future prospects. Any non-GAAP financial measures are not
intended to replace the Company's GAAP results. The Company's intention is to
include the most directly comparable GAAP financial measures and a
reconciliation of the differences between each non-GAAP financial measure used
and the most directly comparable GAAP financial measure.
Readers are encouraged to refer to the risk disclosures described in the
Company's reports on Forms 10-K, 10-Q and 8K, as applicable.
Founded in 1966, Coherent, Inc. is a Standard & Poor's SmallCap 600
company and a world leader in providing photonics based solutions to the
commercial and scientific research markets. Please direct any questions to
Leen Simonet, Chief Financial Officer at 408-764-4161. For more information
about Coherent, visit the Company's Web site at http://www.coherent.com/ for
product and financial updates.
SOURCE Coherent, Inc.
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Related links:
http://www.coherent.com
CONTACT:
Leen Simonet of Coherent, Inc.,
+1-408-764-4161
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