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To: DebtBomb who wrote (29845)	1/24/2001 12:52:31 PM
From: Frederick Langford	Read Replies (1) \| Respond to of 49816

Jan 24,2001 Top Fiber-Optics Companies Are Set to Post Solid Results By Johnathan Burns Dow Jones Newswires Despite signs that the world's largest communications carriers are curtailing infrastructure spending, a host of fiber-optics components and systems makers are expected to post strong results for their latest quarters. Led by component-sector bellwether JDS Uniphase Corp., fiber-cable maker Corning Inc. and systems maker Ciena Corp., fiber-optic companies are expected to show swelling revenue and earnings growth as they continue to sell into the sweet spot of telecommunications spending. "The optical market is still growing in the 40% range," said Tom Lauria, a telecommunications-equipment analyst with ING Barings LLC. "I don't think we'll see it slow down" in 2001. JDS Uniphase, the largest independent maker of fiber-optic components, is expected to report earnings of 19 cents a share for its fiscal second quarter, according to a First Call/Thomson Financial survey of analysts. The company earned nine cents a share in the year-earlier period. Revenue is expected to land between $916 million and $920 million. Jim Jungjohann, a telecommunications-equipment analyst with CIBC World Markets Corp., said he expects JDS Uniphase to post sales of $924 million, up more than threefold year-over-year. He also expects margins to top 50%. The company sells components to systems makers like Lucent Technologies Inc., Nortel Networks Corp. and Alcatel SA, and therefore JDS Uniphase's revenue will be seen as an important indicator of the entire sector's health. The company's stock valuation hasn't been immune to the general slowdown in carrier spending. However, SG Cowen analyst John Butler said he remains very bullish on JDS Uniphase. "We believe that the long-term capital-spending cycle for optical systems and components remains well intact and based on this, we believe JDSU's long-term opportunity remains solid," he said in a recent note. Fellow component maker SDL Inc. is expected to report fourth-quarter earnings of 49 cents a share, the last earnings it will report if its merger with JDS Uniphase closes at the end of the month as planned. In the year-earlier period, the company earned 15 cents a share, adjusted for a 2-for-1 stock split, according to First Call. Revenue is expected to be somewhere around $170 million, based on strong sales from the company's pump laser business. Corning is expected to report fourth-quarter earnings of 28 cents a share, according to First Call. Last year, Corning earned 18 cents a share. Revenue is expected to top $2 billion, as demand for the company's cable continues to outstrip supply. "All indications are that the market for optical fiber remains strong, to the point that some companies in the optical-fiber market are reporting record orders, backlog and even prepayments on 'take or pay' contracts," said Raj Srikanth, an optics analyst with Deutsche Banc Alex. Brown. On the systems-maker sides, Ciena is expected to post earnings of 15 cents a share for the company's fiscal first quarter, according to First Call. The company earned three cents a share last year, adjusted for a 2-for-1 split. Revenue is expected to be around $320 million. Ciena has seen very strong demand, Mr. Lauria said. "They're as well placed in the sector as anyone, because they are a pure optical play. And they have been growing their revenues fairly well." Mr. Lauria said he expects to see the company's CoreDirector optical switch continue to gain market acceptance. Write to Johnathan Burns at johnathan.burns@dowjones.com