EXFO reports:
exfo.com
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· Sales up 108% to US$36.3 million
· Net earnings* up 205% to US$7.5 million
· Sales outlook raised to between US$150 million and US$165 million
· EPS* outlook raised to between US$0.40 and US$0.50
ANAHEIM, CA, March 19, 2001-EXFO Electro-Optical Engineering Inc. (NASDAQ: EXFO, TSE: EXF) announced today record sales and operating results for the second quarter of fiscal 2001.
It marked the fourth consecutive quarter that EXFO has reported record financial results since becoming a public company.
Sales increased 108% to US$36.3 million in the second quarter from US$17.4 million for the same period in fiscal 2000, and 27% sequentially from US$28.5 million in the first quarter of 2001.
Net earnings, excluding amortization of intangible assets and goodwill related to acquisitions, increased 205% to US$7.5 million, or $0.14 per share, for the second quarter from US$2.5 million, or $0.06 per share, for the same period in fiscal 2000. Compared to the first quarter of fiscal 2001, net earnings* in the second quarter dropped 2% from US$7.6 million, or $0.16 per share.
It should be noted that net earnings in the first quarter of 2001 included an after-tax gain in foreign exchange of $0.03 per share and an after-tax gain in interest income of $0.04 per share. In the second quarter, net earnings included an after-tax gain in foreign exchange of $0.01 per share and an after-tax gain in interest income of $0.02 per share. As a result, EXFO increased its net earnings per share* from operations $0.02 from the first to second quarter of fiscal 2001.
Including amortization of intangible assets and goodwill, EXFO's net earnings in the second quarter are at US$24,000, or US$0.00 per share, compared to US$2.4 million, or US$0.06 per share, for the same period in fiscal 2000 and US$7.5 million, or US$0.16 per share, in the first quarter of 2001. The non-cash charges related to acquisitions include US$1.6 million in amortization of intangible assets and US$6.4 million in amortization of goodwill in the second quarter of 2001.
"We're very proud of the fact that we have been able to sustain record growth since becoming a public company four quarters ago," said Germain Lamonde, Chairman, President and CEO of EXFO. "We have been able to maintain this upward trend because we're strategically positioned in high-growth markets in the fiber-optic industry such as DWDM and High-Bandwidth Solutions as well as Optical Component Manufacturing and Testing.
"We also supply all stripes of customers in the fiber-optic industry including network service providers, system and component manufacturers as well as research labs with in excess of 80 product lines, several of which have not yet reached full maturity.
"In addition, we have a diversified global customer base with more than 2000 customers in 70 countries around the world. Our biggest customer accounted for approximately 5.9% of our sales in the second quarter."
The financial results of Burleigh Instruments, a leading supplier of DWDM wavelength measurement instruments and precision positioning equipment in Fishers, NY, are reflected in EXFO's financial statements during this quarter since the acquisition closed on December 20, 2000.
Subsequent to the second quarter, EXFO's affiliate, Burleigh Automation, Inc., closed an agreement to purchase substantially all of the assets of Vanguard Technical Solutions, Inc., an automation equipment manufacturer in Tucson, AZ.
In another transaction subsequent to the second quarter, EXFO closed a deal to acquire Toronto-based EFOS Inc., a leader in precision light-based adhesive spot curing for the global optical component manufacturing market. EFOS' financial results will be consolidated in the third quarter.
"This string of transactions is part of our acquisition strategy to strengthen our position in the optical component manufacturing market," Mr. Lamonde added. "Manufacturers are faced with a pressing need to increase yields and volume while reducing costs in order to meet the fiber-optic industry's growing demand for bandwidth.
"Combining Burleigh Automation's expertise in automated manufacturing and system integration with Burleigh Instruments' nano-positioning and fiber alignment systems, EFOS' advanced light-based curing solutions and EXFO's automated test systems will allow us to offer a whole line of automated solutions for the most critical steps in the optical component manufacturing process."
Based upon financial results in the first half of 2001 and synergies from acquisitions, EXFO has decided to raise guidance for a second consecutive quarter. The sales outlook for fiscal 2001 has been raised to between US$150 million and US$165 million, while the outlook for earnings per share* has been increased to between US$0.40 and US$0.50.
Selling and administrative expenses amounted to US$10.9 million, or 30.1% of sales, for the second quarter compared to US$5.8 million, or 33.4% of sales, for the same period in fiscal 2000 and US$8.9 million, or 31.3% of sales, for the first quarter of fiscal 2001.
Gross research and development expenses were US$4.5 million, or 12.4% of sales, in the second quarter compared to US$2.5 million, or 14.4% of sales, for the same period in fiscal 2000 and US$2.8 million, or 10.0% of sales, for the first quarter of 2001.
To listen to the second-quarter conference call and participate in the question period via telephone, dial 1 (888) 433-1680 or (416) 620-2400. Germain Lamonde and Pierre Plamondon, EXFO's Vice-President of Finance and Chief Financial Officer, will participate in the call. A replay of the conference call can be accessed after 7 p.m. (Eastern time) today until midnight (Eastern time) on March 26, 2001. The replay number is 1 (800) 558-5253 and the password is 18137616. A Web cast of the conference call will be available to all interested parties on EXFO's Web site at www.exfo.com, under the Investors section.
*Excluding amortization of intangible assets and goodwill related to acquisitions
About EXFO
EXFO, which derives its name from expertise in fiber optics, is a leading designer and manufacturer of fiber-optic test, measurement and monitoring instruments for the telecommunications industry. It markets products under two brand names: EXFO and Burleigh Instruments.
EXFO and its subsidiaries develop products mainly for two markets. The Portable and Monitoring Division provides solutions primarily to telecommunications carriers, cable television companies, public utilities, private network operators as well as third-party installers and equipment rental companies. The Industrial and Scientific Division as well as Burleigh Instruments design an extensive line of high-performance instruments and automated test systems for manufacturers of optical components, value-added optical modules and optical networking systems as well as for research and development markets.
This news release may contain statements that constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements other than historical information or statements of current condition. These statements may appear in a number of places in this news release and include statements concerning our intent, belief, or current expectations regarding future events. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those in the forward-looking statements as a result of various factors which are beyond the control of EXFO, including retention of qualified personnel, revenue synergies, demand for testing and measurement instruments and precision positioning instruments. Although we believe that the expectations reflected in the forward-looking statements are reasonable based on information currently available to us, we cannot assure you that the expectations will prove to have been correct. Accordingly, you should not place undue reliance on these forward-looking statements. In any event, these statements speak only as of the date of this news release. We undertake no obligation to revise or update any of them to reflect events or circumstances after the date of this news release, or to reflect new information or the occurrence of unanticipated events. Readers are referred to our Annual Report on Form 20-F and our other filings with the U.S. Securities and Exchange Commission and the Canadian securities commissions for a discussion of the other factors that may affect our future performance and other important risk factors concerning us and our operations. |
