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Technology Stocks : GSCN - General Scanning -- Ignore unavailable to you. Want to Upgrade?

To: BMcV who wrote (165)	1/16/1999 6:19:00 PM
From: DIY Investor	Read Replies (1) \| Respond to of 167

Lumonics to Report Fourth Quarter 1998 Loss, 1st Quarter Restructuring KANATA, ON, January 14 /CNW/ - Lumonics Inc. today announced it expects to report an after-tax loss of between $3.5 million and $4 million (21 cents to 23 cents per share) for the three months ended December 31, 1998. The company expects to release its year end audited results on February 25, 1999. The loss is primarily attributed to the extended downturn in worldwide capital equipment markets, particularly the semiconductor industry. As a result, Lumonics' sales mix continued a shift to lower margin products. In addition, the company incurred higher than expected costs associated with the introduction of new products and the manufacture of large, custom systems. Sales in the fourth quarter will be approximately $52 million. In response, the company plans to reduce its global workforce by 12%. To cover the associated costs, Lumonics will record a restructuring charge of between $1.3 million and $1.6 million in the first quarter of 1999. Considering both business conditions and our pending merger with General Scanning, we are taking further action now to reduce costs,'' said Warren Scott Nix, President and Chief Executive Officer. Our restructuring plan is specifically targeted at areas where we can reduce ongoing expenses, improve cash flow and enhance the competitiveness of both Lumonics and the merged company.'' Nix said Lumonics' sales are likely to remain between $45 million and $55 million per quarter pending a recovery in capital equipment spending. However, because of lower backlog to start the year, first quarter 1999 sales are expected to come in at the lower end of this range. The restructuring we have announced today should allow Lumonics to eliminate losses at a sales volume of approximately $45 million per quarter,'' said Nix. However, because of the timing of our restructuring initiatives, we expect to report a further loss in the first quarter of 1999. Our efforts are focused on restoring profitability beyond the first quarter and positioning Lumonics or the merged company for the eventual rebound in capital equipment spending.'' Nix said the merger between General Scanning of Watertown, Massachusetts and Lumonics is expected to close in the first quarter following shareholder and regulatory approvals. Transition teams, made up of representatives of both companies, have made preliminary recommendations on how the significant synergies between the two companies can be realized. The transition teams' reports provide a blueprint for the merged company,'' said Nix. We have carefully considered their recommendations to ensure Lumonics' restructuring will not only benefit Lumonics but will smooth the way to an efficient, effective and rapid merger. Our restructuring initiatives are also consistent with the strategic restructuring undertaken by General Scanning in the fourth quarter to improve their performance prospects.'' Nix said Lumonics remains enthusiastic and confident about our proposed merger and the long-term prospects for GSI Lumonics, which will be one of the largest and most resourceful providers of laser-based equipment in the world.'' Founded in 1970, Lumonics is a world leader in designing, developing, manufacturing and marketing of laser-based advanced manufacturing systems for semiconductor, electronics, aerospace, automotive and packaging markets. These systems are used in highly automated environments for applications such as cutting, drilling, welding, marking and coding a wide range of products and materials. The company has installed more than 14,000 systems worldwide for some of the world's best known companies. The company's web site address is www.lumonics.com. /For further information: Investor Relations, Lumonics, Tel: 613-592-1460 (extension 1306) or Des Bradley, Vice President Finance & CFO, Tel: 613-592-1460/