Exhibit 99
Release Date: April 21, 2004 Contact: Craig A. Creaturo
Chief Accounting Officer
and Treasurer
(724) 352-4455
ccreaturo@ii-vi.com
Homepage: www.ii-vi.com
II-VI INCORPORATED
REPORTS RECORD THIRD QUARTER EARNINGS,
REVENUES AND BOOKINGS; RAISES FISCAL YEAR GUIDANCE
PITTSBURGH, PA., April 21, 2004 -- II-VI Incorporated (NASDAQ NMS:
IIVI) today reported results for its third fiscal quarter ended March
31, 2004. Net earnings for the quarter were a record $4,775,000 ($0.32
per share-diluted). These results compare with net earnings of
$3,019,000 ($0.21 per share-diluted) in the third quarter of last
fiscal year. For the nine months ended March 31, 2004, net earnings
were $11,313,000 ($0.77 per share-diluted). This compares with net
earnings of $7,994,000 ($0.56 per share-diluted) for the same period
last fiscal year.
Bookings for the quarter increased 12% to a record $41,381,000 compared
to $37,072,000 in the third quarter of last fiscal year. Bookings for
the nine months ended March 31, 2004 increased 13% to $117,073,000 from
$103,978,000 for the same period last year. Bookings are defined as
customer orders received that are expected to be converted into
revenues during the next 12 months.
Revenues for the quarter increased 21% to a record $39,129,000 from
$32,356,000 in the third quarter of last fiscal year. Revenues for the
nine months ended March 31, 2004 increased 13% to $107,858,000 from
$95,358,000 for the same period last fiscal year.
Francis J. Kramer, president and chief operating officer said, "Our
record-setting quarterly earnings, revenues and bookings are the result
of strong demand for II-VI products combined with improved operating
performance in each of our business units. In particular, demand for
infrared optics accelerated during the quarter as the pace of OEM laser
production increased. And our Compound Semiconductor Group (eV
PRODUCTS division and Wide Bandgap Materials group) booked more than $7
million in new orders."
Kramer continued, "Because we expect continued strong demand for
infrared optics, increasing shipment rates for Compound Semiconductor
products, and positive trends in our near-infrared and military
infrared businesses, we are again raising revenue and earnings guidance
for the fiscal year ending June 30, 2004. We are also providing
initial guidance for fiscal year 2005."
Segment Bookings and Revenues
Bookings for the quarter for infrared optics increased 5% to $23.1
million from $22.1 million in the third quarter of last fiscal year.
Bookings for the nine months ended March 31, 2004 for infrared optics
increased 10% to $67.3 million from $61.3 million for the same period
last fiscal year. Revenues for the quarter for infrared optics
increased 20% to $23.6 million from $19.7 million in the third quarter
of the last fiscal year. Revenues for the nine months ended March 31,
2004 for infrared optics increased 14% to $63.4 million from $55.6
million for the same period last fiscal year.
Bookings for the quarter for near-infrared optics increased 4% to $7.1
million from $6.8 million in the third quarter of last fiscal year.
Bookings for the nine months ended March 31, 2004 for near-infrared
optics remained constant at $18.6 million compared to $18.7 million for
the same period last fiscal year. Revenues for the quarter for near-
infrared optics increased 21% to $6.8 million from $5.6 million in the
third quarter of the last fiscal year. Revenues for the nine months
ended March 31, 2004 for near-infrared optics increased 7% to $17.9
million from $16.8 million for the same period last fiscal year.
Bookings for the quarter for military optics decreased 47% to $3.9
million from $7.3 million in the third quarter of the last fiscal year.
Bookings for the nine months ended March 31, 2004 for military optics
increased 10% to $20.5 million from $18.6 million for the same period
last fiscal year. Revenues for the quarter for military optics
increased 21% to $5.8 million compared to $4.8 million in the third
quarter of the last fiscal year. Revenues for the nine months ended
March 31, 2004 for military optics increased 10% to $18.0 million from
$16.4 million for the same period last fiscal year.
Combined bookings for the quarter for the "Compound Semiconductor
Group" category for segment reporting purposes (which primarily
represent the eV PRODUCTS division and the Wide Bandgap Materials
group) were $7.3 million compared to $0.9 million in the third quarter
of the last fiscal year. Combined bookings for the nine months ended
March 31, 2004 for this Group were $10.6 million compared to $5.5
million for the same period last fiscal year. Revenues for the quarter
for this Group were $2.9 million compared to $2.2 million in the third
quarter of last fiscal year. Revenues for the nine months ended March
31, 2004 for this Group were $8.5 million compared to $6.5 million for
the same period last fiscal year.
Outlook
For the fourth fiscal quarter ending June 30, 2004, the Company
currently forecasts revenues to range from $39 million to $41 million
and earnings per share to range from $0.32 to $0.35. For the fiscal
year ending June 30, 2004, the Company currently expects revenues to
range from $147 million to $149 million and earnings per share to range
from $1.09 to $1.12. For the fiscal year ending June 30, 2005, the
Company expects revenues to range from $160 million to $165 million and
earnings per share to range from $1.25 to $1.30. As discussed in more
detail below, actual results may differ from these forecasts due to
numerous factors including changes in product demand, competition and
general economic conditions.
Webcast Information
The Company will host a conference call at 10:00 a.m. Eastern Time on
Thursday, April 22, 2004 to discuss these results. The conference call
will be broadcast live over the Internet and can be accessed by all
interested parties from the Company's web site at www.ii-vi.com as well
as at http://www.firstcallevents.com/service/ajwz404738907gf12.html.
Please allow extra time prior to the call to visit the site and, if
needed, download the media software required to listen to the Internet
broadcast. A replay of the webcast will be available for 2 weeks
following the call.
Headquartered in Saxonburg, Pennsylvania, II-VI Incorporated designs,
manufactures and markets optical and opto-electronic components,
devices and materials for infrared, near-infrared, visible light, x-ray
and gamma-ray instrumentation. The Company's infrared optics business
manufactures optical and opto-electronic components sold under the II-
VI and Laser Power brand names and used primarily in high-power CO2
lasers. The Company's near-infrared optics business manufactures near-
infrared and visible light products for industrial, scientific and
medical instruments and laser gain material and products for solid-
state YAG and YLF lasers at the Company's VLOC subsidiary. The
Company's military infrared optics business manufactures infrared
products for military applications under the Exotic Electro-Optics
brand name. In the Company's Compound Semiconductor Group, the eV
PRODUCTS division manufactures and markets solid-state x-ray and gamma-
ray detection materials and products for use in medical, industrial,
environmental and scientific applications; the Wide Bandgap Materials
(WBG) group manufactures and markets single crystal silicon carbide
substrates for use in solid-state lighting, wireless infrastructure, RF
electronics and power switching industries.
This press release contains forward-looking statements as defined by
Section 21E of the Securities Exchange Act of 1934. Any information
which is not historical in nature constitutes such forward-looking
statements. Actual results may differ from the results described in
any forward-looking statements due to, among other things, changes in
market demand for infrared, near-infrared and military infrared optics,
and products of the Compound Semiconductor Group, including eV PRODUCTS
division and Wide Bandgap Materials group, the Company's ability to
maintain or increase market share, the Company's ability to effectively
address market opportunities, and general market and economic
conditions throughout the world. Additional information on potential
factors that could affect the Company's financial results was included
in the Company's Form 10-K for the year ended June 30, 2003 as filed
with the Securities and Exchange Commission.
CONTACT: Craig A. Creaturo, Chief Accounting Officer and Treasurer of
II-VI Incorporated, 724-352-4455, or e-mail, ccreaturo@ii-vi.com.
II-VI Incorporated and Subsidiaries
Condensed Consolidated Statements of Earnings (Unaudited)
(000 except per share data)
Three Months Ended
March 31,
2004 2003
---------- ----------
Revenues
Net sales $ 36,474 $ 29,305
Contract research and development 2,655 3,051
---------- ----------
39,129 32,356
---------- ----------
Costs, Expenses & Other (Income) Expense
Cost of goods sold 19,525 17,238
Contract research and development 1,808 2,826
Internal research and development 1,259 435
Selling, general and administrative 9,152 7,664
Interest expense 101 174
Other (income) expense, net 105 (93)
---------- ----------
31,950 28,244
---------- ----------
Earnings Before Income Taxes 7,179 4,112
Income Taxes 2,404 1,093
---------- ----------
Net Earnings $ 4,775 $ 3,019
========== ==========
Diluted Earnings Per Share $ 0.32 $ 0.21
========== ==========
Average Shares Outstanding - Diluted 14,723 14,440
II-VI Incorporated and Subsidiaries
Condensed Consolidated Statements of Earnings (Unaudited)
(000 except per share data)
Nine Months Ended
March 31,
2004 2003
---------- ----------
Revenues
Net sales $ 101,499 $ 87,412
Contract research and development 6,359 7,946
---------- ----------
107,858 95,358
---------- ----------
Costs, Expenses & Other (Income) Expense
Cost of goods sold 56,582 52,865
Contract research and development 5,175 7,202
Internal research and development 3,713 1,946
Selling, general and administrative 25,160 21,551
Interest expense 352 699
Other (income) expense, net (135) 394
---------- ----------
90,847 84,657
---------- ----------
Earnings Before Income Taxes 17,011 10,701
Income Taxes 5,698 2,707
---------- ----------
Net Earnings $ 11,313 $ 7,994
========== ==========
Diluted Earnings Per Share $ 0.77 $ 0.56
========== ==========
Average Shares Outstanding - Diluted 14,677 14,381
II-VI Incorporated and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
($000)
March 31, June 30,
2004 2003
------------ ---------
Assets
Current Assets
Cash and cash equivalents $ 16,440 $ 15,583
Accounts receivable, net 25,023 22,086
Inventories 29,233 24,384
Deferred income taxes 2,888 3,794
Other current assets 1,573 1,968
------------ ---------
Total Current Assets 75,157 67,815
Property, Plant & Equipment, net 60,828 57,954
Goodwill, net 28,987 28,987
Investment 1,829 1,792
Other Intangible Assets, net 6,038 4,643
Other Assets 2,151 1,602
------------ ---------
$174,990 $162,793
============ =========
Liabilities and Shareholders' Equity
Current Liabilities
Accounts payable $ 6,483 $ 6,115
Current portion of long-term debt 7,550 6,923
Other current liabilities 17,511 14,577
------------ ---------
Total Current Liabilities 31,544 27,615
Long-Term Debt-less current portion 10,500 16,782
Other Liabilities, primarily deferred
income taxes 8,061 6,875
Shareholders' Equity 124,885 111,521
------------ ---------
$174,990 $162,793
============ =========
II-VI Incorporated and Subsidiaries
Condensed Segment and Other Selected Financial Information (Unaudited)
($000)
The following segment and other financial information includes segment
earnings (defined as earnings before income taxes, interest expense and
other income or expense, net) and earnings before interest, income
taxes, depreciation and amortization (EBITDA). Management believes
segment earnings are a useful performance measure because they reflect
the results of segment performance over which management has direct
control. Similarly, EBITDA reflects operating profitability before
certain non-operating expenses and non-cash charges.
Three Months Ended Nine Months Ended
March 31, March 31,
------------------ -----------------
Segment Information 2004 2003 2004 2003
- ----------------- -------- -------- -------- -------
Revenues
Infrared Optics $23,625 $19,715 $ 63,422 $55,641
Near-Infrared Optics 6,775 5,647 17,907 16,793
Military Infrared Optics 5,847 4,788 18,046 16,381
Compound Semiconductor Group 2,882 2,206 8,483 6,543
- ----------------- -------- -------- -------- -------
Total Revenues $39,129 $32,356 $107,858 $95,358
======== ======== ======== =======
Segment earnings (loss)
Infrared Optics $ 6,532 $ 5,462 $ 17,141 $14,109
Near-Infrared Optics 659 393 1,351 1,151
Military Infrared Optics 276 (453) 515 38
Compound Semiconductor Group (82) (1,209) (1,779) (3,504)
- ----------------- -------- -------- -------- -------
Total Segment Earnings $ 7,385 $ 4,193 $ 17,228 $11,794
======== ======== ======== =======
Three Months Ended Nine Months Ended
March 31, March 31,
Other Selected --------------------- -------------------
Financial Information 2004 2003 2004 2003
- ---------------------- -------- -------- -------- -------
Earnings before interest,
income taxes, depreciation $ 9,775 $ 6,654 $ 24,603 $ 18,651
and amortization (EBITDA)
Cash paid for capital
expenditures $ 3,170 $ 1,201 $ 8,889 $ 4,053
Payments on indebtedness,
net of borrowings $ 2,639 $ 5,018 $ 6,036 $ 8,871
II-VI Incorporated and Subsidiaries
Condensed Segment and Other Selected Financial Information (Unaudited)
(cont.)
($000)
Reconciliation of Segment Earnings and EBITDA
to Earnings Before Income Taxes
Three Months Ended Nine Months Ended
March 31, March 31,
--------------------- -------------------
2004 2003 2004 2003
-------- -------- -------- -------
Total Segment Earnings $ 7,385 $ 4,193 $ 17,228 $ 11,794
Interest expense 101 174 352 699
Other (income) expense, net 105 (93) (135) 394
-------- -------- -------- --------
Earnings before
income taxes $ 7,179 $ 4,112 $ 17,011 $ 10,701
======== ======== ======== ========
EBITDA $ 9,775 $ 6,654 $ 24,603 $ 18,651
Interest expense 101 174 352 699
Depreciation and
amortization 2,495 2,368 7,240 7,251
-------- -------- -------- --------
Earnings before
income taxes $ 7,179 $ 4,112 $ 17,011 $ 10,701
======== ======== ======== ========
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