Coherent, Inc. Second Quarter Results Include Record Sales and Record Net Income

Apr 24, 2001, 01:00 ET from Coherent, Inc.

    SANTA CLARA, Calif., April 24 /PRNewswire Interactive News Release/ --
 Coherent, Inc. (Nasdaq: COHR) today announced financial results for its
 second quarter ended March 31, 2001.  During the quarter, the Company took
 the steps it considered necessary to strategically focus on those high
 growth markets, technologies, and opportunities that are best complemented
 by our core competencies.  On February 26, 2001, the Company announced that
 it had signed an agreement to sell its Medical segment to
 ESC Medical Systems Ltd. (Nasdaq: ESCM) for a combination of cash, notes and
 stock valued at the date of announcement at approximately $203.0 million, plus
 a potential earnout of up to $25.0 million.  Based on this, the Company's
 report on its second quarter reflects the results of its Medical segment as a
 discontinued operation.  It is currently anticipated that the transaction will
 close within the next several weeks and will result in a one-time gain for
 Coherent.
     Total bookings and sales, including both continued and discontinued
 operations (including bookings and sales from our continuing operations to
 our Medical segment) for the second quarter were $179.8 and $183.8 million,
 respectively, representing increases of 9% and 29%, respectively, over the
 same quarter last year.  Bookings and sales from continuing operations were
 $126.8 million and $129.8 million, representing increases of 11% and 42% over
 the like prior year period.  Net income for the current quarter was
 $14.7 million ($0.51 per diluted share), a record for the Company and an
 increase of 75% over the corresponding prior year period.  Income from
 continuing operations during the second quarter was $11.3 million ($0.39 per
 diluted share).  This compares to $6.3 million ($0.23 per diluted share) in
 the quarter ended April 1, 2000, an increase of 81%.
     Bernard Couillaud, Coherent's President and Chief Executive Officer
 commented, "The results for the quarter were achieved despite a significant
 slowdown in the global economy, especially within the technology sector.  I
 believe that we can attribute the excellent quarterly performance to both the
 existing high backlog of orders entering the period and the enabling nature of
 our products.  While I am always pleased with improvements in operating
 performance, I am especially grateful for those efforts and contributions put
 forth by all our employees during this period of uncertainty caused by market
 softness and changes in corporate strategic direction.  It is anticipated that
 our Medical Group will be joining forces with ESC Medical Systems Ltd within
 the next few weeks.  The new company will be known as Lumenis and should be a
 world leader in light and laser based medical systems for a myriad of
 applications.  I am truly excited about the opportunity for a new streamlined
 Coherent to focus on high-growth markets while at the same time participating
 in the medical business through our resulting equity ownership position in
 Lumenis."
     The current quarter gross profit as a percentage of sales from continuing
 operations was 44.6% compared to 46.5% in the corresponding prior year period.
 The Company attributes much of this percent reduction to the strengthening of
 the US dollar over the periods affected.
     The Electro-Optics segment achieved record sales of $95.4 million during
 the three months ended March 31, 2001, an increase of 35% from the same
 quarter last year.  Bookings for this segment of $75.2 million reflected a
 10% decline from the corresponding prior year period.  This decline was
 attributed to several factors including the timing of large orders received
 as exemplified by the fact that for the six month period ending March 31,
 2001, orders were 20% higher than orders received in the first six months of
 fiscal 2000; furthermore, the softening in the telecommunications marketplace
 is causing customers to remain cautious with their ordering practices with the
 uncertain short-term outlook in their businesses.
     Company-wide telecommunications bookings (primarily in our Electro-Optics
 segment) during the quarter approximated $2.4 million.  This compares to
 $5.3 million in the year earlier period and $10.3 million in the most recent
 prior quarter.
     The Lambda Physik segment continued to excel with record bookings and
 sales of $51.6 million and $34.4 million, respectively.  Their quarterly
 bookings and sales reflect increases of 70% and 66% for the respective
 categories over the similar prior year period.  On March 6, 2001, Lambda
 announced that it had received the largest single order in its history from
 Japan Steel Works.  The $20.0 million order is for Lambda to supply its Lambda
 STEEL lasers within the next twelve months.  These lasers will be used to
 produce the new generation of TFT flat-panel displays, which are used in such
 fast growing applications as navigation systems, mobile telephones, digital
 cameras, and laptop computers.
     Summarized financial information is as follows (unaudited):
 
 
                                     Three Months Ended      Six Months Ended
 
                                 Mar. 31, Dec. 30,  Apr. 1,  Mar. 31, Apr. 1,
                                   2001     2000      2000     2001     2000
                                     (In thousands, except per share data)
 
     Net sales                   $129,788 $111,813  $91,671 $241,601 $176,082
     Cost of sales                 71,838   60,399   49,083  132,237   95,009
     Gross profit                  57,950   51,414   42,588  109,364   81,073
       Research and development    13,257   11,155   10,088   24,412   18,475
       Intangibles amortization       784      768      723    1,552    1,405
       Selling, general and
        administrative             27,540   25,652   22,634   53,192   42,867
     Total operating expenses      41,581   37,575   33,445   79,156   62,747
     Income from operations        16,369   13,839    9,143   30,208   18,326
     Other income (expense), net    3,120    3,065      577    6,185    (620)
     Income from continuing
      operations before
      income taxes and
      minority interest            19,489   16,904    9,720   36,393   17,706
     Provision for taxes            6,556    5,740    3,116   12,296    5,556
     Income from continuing
      operations before
      minority interest            12,933   11,164    6,604   24,097   12,150
     Minority interest            (1,605)  (1,412)    (333)  (3,017)    (970)
     Income from continuing
      operations                   11,328    9,752    6,271   21,080   11,180
     Income from discontinued
      operations                    3,384    2,313    2,132    5,697    3,896
     Cumulative effect of
      accounting change                        166               166
     Net income                   $14,712  $12,231   $8,403  $26,943  $15,076
 
     Earnings per share,
      diluted:
     Income from continuing
      operations                    $0.39    $0.34    $0.23    $0.74    $0.42
     Income from discontinued
      operations                     0.12     0.08     0.08     0.20     0.15
     Income before accounting
      change                         0.51     0.42     0.31     0.94     0.57
     Cumulative effect of
      accounting change              0.00     0.01     0.00     0.01     0.00
     Net income                     $0.51    $0.43    $0.31    $0.94    $0.57
 
     Shares used in computation:
       Basic                       27,397   27,230   24,892   27,313   24,705
       Diluted                     28,736   28,537   27,412   28,636   26,594
 
 
                                                     Mar. 31,      Sept. 30,*
                                                       2001           2000
                                                          (in thousands)
     ASSETS
     CURRENT ASSETS:
       Cash and short-term investments               $195,455       $258,169
       Accounts receivable, net                       129,399        112,401
       Inventories                                    145,896        126,617
       Prepaid expenses and other assets               55,815         61,875
     TOTAL CURRENT ASSETS                             526,565        559,062
 
     PROPERTY AND EQUIPMENT, NET                      142,067        102,590
     OTHER ASSETS                                     143,387         83,833
     TOTAL ASSETS                                    $812,019       $745,485
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     CURRENT LIABILITIES:
       Short-term borrowings                          $21,699         $4,211
       Current portion of long-term obligations         7,685          7,687
       Accounts payable                                35,665         29,282
       Other current liabilities                      107,449         95,018
     TOTAL CURRENT LIABILITIES                        172,498        136,198
     LONG-TERM OBLIGATIONS                             67,327         68,647
     OTHER LONG-TERM LIABILITIES                       76,781         78,425
 
     TOTAL STOCKHOLDERS' EQUITY                       495,413        462,215
 
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY      $812,019       $745,485
 
     * Derived from the September 30, 2000 audited financial statements.
 
 
     The Company's conference call scheduled for 1:30 p.m. today will include
 discussions relative to these current quarter results, an up-to-date status of
 the pending sale of the Medical segment, and some forward looking guidance on
 future operating performance.
 
     "Safe Harbor" Statement Under the Private Securities Litigation Reform Act
     The statements in this press release that relate to future plans, events
 or performance, including statements regarding Coherent's or management's
 intentions, hopes, beliefs, expectations, representations, projections, plans
 or predictions of the future, are forward-looking statements within the
 meaning of the Private Securities Litigation Reform Act of 1995. Such
 statements including statements regarding a potential earnout of
 $25.0 million, and the transaction will close in the next several weeks.
 Actual results, events and performance may differ materially.  Factors that
 could cause actual results to differ materially include risks related to
 customer demand for the company's products, competitive factors, the company's
 ability to expand its manufacturing facilities to meet customer demand,
 fluctuations in the relative values of currency, and manufacturing risks.
 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 release publicly the result of any revisions to these
 forward-looking statements that may be made to reflect events or circumstances
 after the date hereof or to reflect the occurrence of unanticipated events.
 Readers are encouraged to refer to the risk disclosures described in the
 Company's reports filed with the SEC, including but not limited to the Form
 10-K for the fiscal year ended September 30, 2000.
     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, scientific, medical, and telecom markets. Please direct any
 questions to Peter Schuman, Director, Investor Relations at 408-764-4174. For
 more information about Coherent, visit the Company's Web site at
 http://www.coherentinc.com.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X54756437
 
 

SOURCE Coherent, Inc.
    SANTA CLARA, Calif., April 24 /PRNewswire Interactive News Release/ --
 Coherent, Inc. (Nasdaq: COHR) today announced financial results for its
 second quarter ended March 31, 2001.  During the quarter, the Company took
 the steps it considered necessary to strategically focus on those high
 growth markets, technologies, and opportunities that are best complemented
 by our core competencies.  On February 26, 2001, the Company announced that
 it had signed an agreement to sell its Medical segment to
 ESC Medical Systems Ltd. (Nasdaq: ESCM) for a combination of cash, notes and
 stock valued at the date of announcement at approximately $203.0 million, plus
 a potential earnout of up to $25.0 million.  Based on this, the Company's
 report on its second quarter reflects the results of its Medical segment as a
 discontinued operation.  It is currently anticipated that the transaction will
 close within the next several weeks and will result in a one-time gain for
 Coherent.
     Total bookings and sales, including both continued and discontinued
 operations (including bookings and sales from our continuing operations to
 our Medical segment) for the second quarter were $179.8 and $183.8 million,
 respectively, representing increases of 9% and 29%, respectively, over the
 same quarter last year.  Bookings and sales from continuing operations were
 $126.8 million and $129.8 million, representing increases of 11% and 42% over
 the like prior year period.  Net income for the current quarter was
 $14.7 million ($0.51 per diluted share), a record for the Company and an
 increase of 75% over the corresponding prior year period.  Income from
 continuing operations during the second quarter was $11.3 million ($0.39 per
 diluted share).  This compares to $6.3 million ($0.23 per diluted share) in
 the quarter ended April 1, 2000, an increase of 81%.
     Bernard Couillaud, Coherent's President and Chief Executive Officer
 commented, "The results for the quarter were achieved despite a significant
 slowdown in the global economy, especially within the technology sector.  I
 believe that we can attribute the excellent quarterly performance to both the
 existing high backlog of orders entering the period and the enabling nature of
 our products.  While I am always pleased with improvements in operating
 performance, I am especially grateful for those efforts and contributions put
 forth by all our employees during this period of uncertainty caused by market
 softness and changes in corporate strategic direction.  It is anticipated that
 our Medical Group will be joining forces with ESC Medical Systems Ltd within
 the next few weeks.  The new company will be known as Lumenis and should be a
 world leader in light and laser based medical systems for a myriad of
 applications.  I am truly excited about the opportunity for a new streamlined
 Coherent to focus on high-growth markets while at the same time participating
 in the medical business through our resulting equity ownership position in
 Lumenis."
     The current quarter gross profit as a percentage of sales from continuing
 operations was 44.6% compared to 46.5% in the corresponding prior year period.
 The Company attributes much of this percent reduction to the strengthening of
 the US dollar over the periods affected.
     The Electro-Optics segment achieved record sales of $95.4 million during
 the three months ended March 31, 2001, an increase of 35% from the same
 quarter last year.  Bookings for this segment of $75.2 million reflected a
 10% decline from the corresponding prior year period.  This decline was
 attributed to several factors including the timing of large orders received
 as exemplified by the fact that for the six month period ending March 31,
 2001, orders were 20% higher than orders received in the first six months of
 fiscal 2000; furthermore, the softening in the telecommunications marketplace
 is causing customers to remain cautious with their ordering practices with the
 uncertain short-term outlook in their businesses.
     Company-wide telecommunications bookings (primarily in our Electro-Optics
 segment) during the quarter approximated $2.4 million.  This compares to
 $5.3 million in the year earlier period and $10.3 million in the most recent
 prior quarter.
     The Lambda Physik segment continued to excel with record bookings and
 sales of $51.6 million and $34.4 million, respectively.  Their quarterly
 bookings and sales reflect increases of 70% and 66% for the respective
 categories over the similar prior year period.  On March 6, 2001, Lambda
 announced that it had received the largest single order in its history from
 Japan Steel Works.  The $20.0 million order is for Lambda to supply its Lambda
 STEEL lasers within the next twelve months.  These lasers will be used to
 produce the new generation of TFT flat-panel displays, which are used in such
 fast growing applications as navigation systems, mobile telephones, digital
 cameras, and laptop computers.
     Summarized financial information is as follows (unaudited):
 
 
                                     Three Months Ended      Six Months Ended
 
                                 Mar. 31, Dec. 30,  Apr. 1,  Mar. 31, Apr. 1,
                                   2001     2000      2000     2001     2000
                                     (In thousands, except per share data)
 
     Net sales                   $129,788 $111,813  $91,671 $241,601 $176,082
     Cost of sales                 71,838   60,399   49,083  132,237   95,009
     Gross profit                  57,950   51,414   42,588  109,364   81,073
       Research and development    13,257   11,155   10,088   24,412   18,475
       Intangibles amortization       784      768      723    1,552    1,405
       Selling, general and
        administrative             27,540   25,652   22,634   53,192   42,867
     Total operating expenses      41,581   37,575   33,445   79,156   62,747
     Income from operations        16,369   13,839    9,143   30,208   18,326
     Other income (expense), net    3,120    3,065      577    6,185    (620)
     Income from continuing
      operations before
      income taxes and
      minority interest            19,489   16,904    9,720   36,393   17,706
     Provision for taxes            6,556    5,740    3,116   12,296    5,556
     Income from continuing
      operations before
      minority interest            12,933   11,164    6,604   24,097   12,150
     Minority interest            (1,605)  (1,412)    (333)  (3,017)    (970)
     Income from continuing
      operations                   11,328    9,752    6,271   21,080   11,180
     Income from discontinued
      operations                    3,384    2,313    2,132    5,697    3,896
     Cumulative effect of
      accounting change                        166               166
     Net income                   $14,712  $12,231   $8,403  $26,943  $15,076
 
     Earnings per share,
      diluted:
     Income from continuing
      operations                    $0.39    $0.34    $0.23    $0.74    $0.42
     Income from discontinued
      operations                     0.12     0.08     0.08     0.20     0.15
     Income before accounting
      change                         0.51     0.42     0.31     0.94     0.57
     Cumulative effect of
      accounting change              0.00     0.01     0.00     0.01     0.00
     Net income                     $0.51    $0.43    $0.31    $0.94    $0.57
 
     Shares used in computation:
       Basic                       27,397   27,230   24,892   27,313   24,705
       Diluted                     28,736   28,537   27,412   28,636   26,594
 
 
                                                     Mar. 31,      Sept. 30,*
                                                       2001           2000
                                                          (in thousands)
     ASSETS
     CURRENT ASSETS:
       Cash and short-term investments               $195,455       $258,169
       Accounts receivable, net                       129,399        112,401
       Inventories                                    145,896        126,617
       Prepaid expenses and other assets               55,815         61,875
     TOTAL CURRENT ASSETS                             526,565        559,062
 
     PROPERTY AND EQUIPMENT, NET                      142,067        102,590
     OTHER ASSETS                                     143,387         83,833
     TOTAL ASSETS                                    $812,019       $745,485
 
     LIABILITIES AND STOCKHOLDERS' EQUITY
     CURRENT LIABILITIES:
       Short-term borrowings                          $21,699         $4,211
       Current portion of long-term obligations         7,685          7,687
       Accounts payable                                35,665         29,282
       Other current liabilities                      107,449         95,018
     TOTAL CURRENT LIABILITIES                        172,498        136,198
     LONG-TERM OBLIGATIONS                             67,327         68,647
     OTHER LONG-TERM LIABILITIES                       76,781         78,425
 
     TOTAL STOCKHOLDERS' EQUITY                       495,413        462,215
 
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY      $812,019       $745,485
 
     * Derived from the September 30, 2000 audited financial statements.
 
 
     The Company's conference call scheduled for 1:30 p.m. today will include
 discussions relative to these current quarter results, an up-to-date status of
 the pending sale of the Medical segment, and some forward looking guidance on
 future operating performance.
 
     "Safe Harbor" Statement Under the Private Securities Litigation Reform Act
     The statements in this press release that relate to future plans, events
 or performance, including statements regarding Coherent's or management's
 intentions, hopes, beliefs, expectations, representations, projections, plans
 or predictions of the future, are forward-looking statements within the
 meaning of the Private Securities Litigation Reform Act of 1995. Such
 statements including statements regarding a potential earnout of
 $25.0 million, and the transaction will close in the next several weeks.
 Actual results, events and performance may differ materially.  Factors that
 could cause actual results to differ materially include risks related to
 customer demand for the company's products, competitive factors, the company's
 ability to expand its manufacturing facilities to meet customer demand,
 fluctuations in the relative values of currency, and manufacturing risks.
 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 release publicly the result of any revisions to these
 forward-looking statements that may be made to reflect events or circumstances
 after the date hereof or to reflect the occurrence of unanticipated events.
 Readers are encouraged to refer to the risk disclosures described in the
 Company's reports filed with the SEC, including but not limited to the Form
 10-K for the fiscal year ended September 30, 2000.
     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, scientific, medical, and telecom markets. Please direct any
 questions to Peter Schuman, Director, Investor Relations at 408-764-4174. For
 more information about Coherent, visit the Company's Web site at
 http://www.coherentinc.com.
 
                      MAKE YOUR OPINION COUNT - Click Here
                http://tbutton.prnewswire.com/prn/11690X54756437
 
 SOURCE  Coherent, Inc.