SANTA CLARA, Calif., May 7 /PRNewswire-FirstCall/ -- Coherent, Inc. (Nasdaq: COHR) today announced financial results for its second fiscal quarter ended April 4, 2009, posting net sales of $105.4 million and a net loss, on a U.S. generally accepted accounting principles (GAAP) basis, of $9.1 million ($0.38 per share). These results compare to net sales of $155.9 million and net income of $6.1 million, or $0.19 per diluted share, for the second quarter of fiscal 2008.
Non-GAAP net income for the second quarter of fiscal 2009 was $0.3 million or $0.01 per share after excluding an after tax charge of $0.4 million related to litigation resulting from our internal stock option investigation ($0.01 per share), after tax stock-related compensation expense of $2.0 million ($0.08 per share), restructuring expense of $4.5 million, net of tax ($0.18 per share) and a non-cash tax expense resulting from a recently enacted change in state tax law of $2.7 million ($0.11 per share). Net income for the second quarter of fiscal 2008 included an after tax charge of $1.5 million for internal stock option investigation costs ($0.05 per diluted share), $3.7 million of stock-related compensation expense, net of tax ($0.12 per diluted share) and a $1.4 million one-time tax charge ($0.04 per diluted share). Excluding these charges, non-GAAP net income for the second quarter of fiscal 2008 was $12.8 million or $0.40 per diluted share.
In comparison, net sales for the first quarter of fiscal 2009 were $124.4 million and net loss, on a GAAP basis, was $14.7 million ($0.61 per share), primarily due to a non-cash goodwill impairment charge of $19.3 million ($0.80 per share). Net loss for the first quarter of fiscal 2009 included an after tax charge of $0.3 million related to litigation resulting from our internal stock option investigation ($0.01 per share), after tax stock-related compensation expense of $1.2 million ($0.05 per share) and restructuring expense of $2.6 million, net of tax ($0.11 per share). Excluding these charges, non-GAAP net income for the first quarter of fiscal 2009 was $8.6 million, or $0.36 per share.
Orders received during the three months ended April 4, 2009 of $93.8 million decreased 36.8% from the same prior year period and decreased by 9.2% compared to orders received in the immediately preceding quarter. The book-to-bill ratio was 0.89, resulting in backlog of $145.9 million at April 4, 2009 compared to a backlog of $162.0 million at December 27, 2008 and a backlog of $199.3 million at March 29, 2008.
As of April 4, 2009, year-to-date sales of $229.8 million and net loss on a GAAP basis of $23.8 million ($0.98 per share) compared to the prior year period sales of $300.2 million and a net income of $10.9 million ($0.34 per diluted share). Orders received for the six month period ended April 4, 2009 were $197.2 million, compared to $303.4 million in orders received during the same period a year ago.
"While overall market conditions remain challenging, there are several emerging trends. The scientific research business is stable and domestic customers are optimistic that funding increases are forthcoming from the U.S stimulus package," said John Ambroseo, Coherent's President and CEO. "On the commercial side, we are seeing signs of inventory replenishment, albeit to lower stocking levels, and customers are re-engaging in the sales process for new and existing applications. These are positive signs, but it is more likely that we are near the bottom of the demand curve and a bookings recovery is still a few quarters away," he added.
Summarized statement of operations information is as follows (unaudited,
in thousands except per share data):
Three Months Ended Six Months Ended
April 4, Dec. 27, March 29, April 4, March 29,
2009 2008 2008 2009 2008
Net sales $105,422 $124,388 $155,942 $229,810 $300,238
Cost of sales (A) (B) 65,815 73,999 88,818 139,814 172,620
Gross profit 39,607 50,389 67,124 89,996 127,618
Operating expenses:
Research &
development (A) (B) 15,610 14,778 19,428 30,388 37,747
Selling, general
& administrative
(A) (B) (C) 27,962 23,628 37,384 51,590 76,202
Impairment of
goodwill(D) - 19,286 - 19,286 -
Intangibles
amortization 1,894 1,943 2,229 3,837 4,435
Total operating
expenses 45,466 59,635 59,041 105,101 118,384
Income (loss) from
operations (5,859) (9,246) 8,083 (15,105) 9,234
Other income
(expense), net (1,600) (4,230) 4,263 (5,830) 10,144
Income (loss)
before income taxes (7,459) (13,476) 12,346 (20,935) 19,378
Provision for
income taxes (E) 1,671 1,203 6,221 2,874 8,524
Net income (loss) $(9,130) $(14,679) 6,125 $(23,809) $10,854
Net income (loss)
per share:
Basic $(0.38) $(0.61) $0.20 $(0.98) $0.35
Diluted $(0.38) $(0.61) $0.19 $(0.98) $0.34
Shares used in
computation:
Basic 24,258 24,145 31,394 24,202 31,406
Diluted 24,258 24,145 31,874 24,202 31,916
(A) The quarter ended April 4, 2009 includes $2,425 ($1,972 net of tax
($0.08 per share)) of stock-related compensation expense. Pretax
stock-related compensation expense is recorded in the statement
lines as follows: $177 to cost of sales; $239 to research and
development; and $2,009 to selling, general and administrative. The
quarter ended December 27, 2008 includes $1,690 ($1,153 net of tax
($0.05 per share)) of stock-related compensation expense. Pretax
stock-related compensation expense is recorded in the statement
lines as follows: $283 to cost of sales; $195 to research and
development; and $1,212 to selling, general and administrative. The
quarter ended March 29, 2008 includes $4,949 ($3,734 net of tax
($0.12 per diluted share)) of stock-related compensation expense.
Pretax stock-related compensation expense is recorded in the
statement lines as follows: $759 to cost of sales; $808 to research
and development; and $3,382 to selling, general and administrative.
The six months ended April 4, 2009 includes $4,115 ($3,125 net of
tax ($0.13 per share)) of stock-related compensation expense.
Pretax stock-related compensation expense is recorded in the
statement lines as follows: $461 to cost of sales; $434 to research
and development; and $3,220 to selling, general and administrative.
The six months ended March 29, 2008 includes $7,654 ($5,667 net of
tax ($0.18 per diluted share)) of stock-related compensation
expense. Pretax stock-related compensation expense is recorded in
the statement lines as follows: $1,144 to cost of sales; $1,127 to
research and development; and $5,383 to selling, general and
administrative.
(B) The quarter ended April 4, 2009 includes $5,000 ($4,463 net of tax
($0.18 per share)) of restructuring costs primarily related to the
exit of our Auburn, California facility, the consolidation of our
German Excimer manufacturing into one location in Germany and
headcount reductions due to current economic conditions. Pretax
restructuring costs are recorded in the statement lines as follows:
$3,153 to cost of sales; $824 to research and development; and
$1,023 to selling, general and administrative. The quarter ended
December 27, 2008 includes $4,106 ($2,613 net of tax ($0.11 per
share)) of restructuring costs primarily related to the exit of our
Auburn, California facility, the consolidation of our German Excimer
manufacturing into one location in Germany and headcount reductions
due to current economic conditions. Pretax restructuring costs are
recorded in the statement lines as follows: $3,022 to cost of sales;
$466 to research and development; and $618 to selling, general and
administrative. The six months ended April 4, 2009 includes $9,106
($7,076 net of tax ($0.29 per share)) of restructuring costs
primarily related to the exit of our Auburn, California facility,
the consolidation of our German Excimer manufacturing into one
location in Germany and headcount reductions due to current economic
conditions. Pretax restructuring costs are recorded in the
statement lines as follows: $6,175 to cost of sales; $1,290 to
research and development; and $1,641 to selling, general and
administrative.
(C) The quarter ended April 4, 2009 includes $398 ($356 net of tax
($0.01 per share)) of costs related to litigation resulting from our
internal stock option investigation. The quarter ended December 27,
2008 includes $441 ($269 net of tax ($0.01 per share)) of costs
related to litigation resulting from our internal stock option
investigation. The quarter ended March 29, 2008 includes $2,505
($1,528 net of tax ($0.05 per diluted share)) of costs related to
our restatement of financial statements and litigation resulting
from our internal stock option investigation. The six months ended
April 4, 2009 includes $840 ($625 net of tax ($0.03 per share)) of
costs related to litigation resulting from our internal stock option
investigation. The six months ended March 29, 2008 includes $7,254
($4,377 net of tax ($0.14 per share)) of costs related to our
restatement of financial statements and litigation resulting from
our internal stock option investigation.
(D) The quarter ended December 27, 2008 and the six months ended April 4,
2009 include a $19,286 ($0.80 per share) non-cash charge for the
impairment of all of the goodwill of our Commercial Lasers and
Components segment.
(E) The quarter and six-months ended April 4, 2009 includes a tax charge
of $2,666 ($0.11 per share) resulting from a recently enacted change
in state tax law. The quarter and six-months ended March 29, 2008
includes a tax charge of $1,394 ($0.04 per diluted share) in
connection with a dividend from one of our European subsidiaries.
Summarized balance sheet information is as follows (unaudited, in
thousands):
April 4, Sept. 27,
2009 2008
ASSETS
Current assets:
Cash, cash equivalents and short-term investments $206,800 $218,094
Restricted cash -- 2,645
Accounts receivable, net 81,302 96,611
Inventories 114,239 120,519
Prepaid expenses and other assets 72,713 71,914
Total current assets 475,054 509,783
Property and equipment, net 100,094 100,996
Other assets 166,050 195,604
Total assets $741,198 $806,383
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations $ 8 $ 9
Accounts payable 20,316 26,333
Other current liabilities 76,205 86,985
Total current liabilities 96,529 113,327
Other long-term liabilities 83,334 94,621
Total stockholders' equity 561,335 598,435
Total liabilities and stockholders' equity $741,198 $806,383
Reconciliation of GAAP to Non-GAAP net income (unaudited, in thousands,
net of tax):
Three Months Ended Six Months Ended
April 4, Dec. 27, March 29, April 4, March 29,
2009 2008 2008 2009 2008
GAAP net income (loss) $(9,130) $(14,679) $6,125 $(23,809) $10,854
Stock option investigation
and related restatement
of financial statements,
and litigation expenses 356 269 1,528 625 4,377
Stock-related compensation
expense 1,972 1,153 3,734 3,125 5,667
Impairment of goodwill -- 19,286 -- 19,286 --
Restructuring costs 4,463 2,613 -- 7,076 --
One-time tax expense 2,666 -- 1,394 2,666 1,394
Non-GAAP net income $327 $8,642 $12,781 $8,969 $22,292
Non-GAAP net income
per share $0.01 $0.36 $0.40 $0.37 $0.70
The Company's conference call scheduled for 1:30 p.m. PT today will include discussions relative to the second quarter results and some comments regarding forward looking guidance on future operating performance. Readers are encouraged to refer to the risk disclosures described in the Company's reports on Forms 10-K, 10-Q and 8-K, as applicable and as filed from time-to-time by the Company.
Forward-Looking Statements
This press release contains forward-looking statements, as defined under the Federal securities laws. These forward-looking statements include the statements in this press release that relate to the timing and occurrence of the impact on domestic customers from the U.S. stimulus packages, the timing and occurrence of inventory replenishment and any increase in orders and the timing and occurrence of a bottom of the demand curve and any bookings recovery. These forward-looking statements are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause our actual results to differ materially and adversely from those expressed in any forward-looking statement. Factors that could cause actual results to differ materially include risks and uncertainties, including, but not limited to, risks associated with quarterly and annual fluctuations in our net sales and operating results, our exposure to risks associated with worldwide economic slowdowns, our ability to increase our sales volumes and decrease our costs, the impact that our operations and potential acquisitions will have on interest, taxes, depreciation and amortization measurements, changes to the Company's tax rate as a result of government action, customer acceptance and adoption of our new product offerings, and other risks identified in the Company's SEC filings. Readers are encouraged to refer to the risk disclosures described in the Company's reports on Forms 10-K, 10-Q and 8-K, as applicable and as filed from time-to-time by the Company. Actual results, events and performance may differ materially from those presented herein. 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.
Founded in 1966, Coherent, Inc. is a world leader in providing photonics based solutions to the commercial and scientific research markets and part of the Russell 2000. 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.
