EXHIBIT 99.1

                                GSI LUMONICS INC.
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                   RESULTS OF OPERATIONS - CANADIAN SUPPLEMENT
        (in United States dollars, and in accordance with Canadian GAAP)

The following Management's Discussion and Analysis of Financial Condition and
Results of Operations - Canadian Supplement ("Canadian Supplement") should be
read in conjunction with our Management's Discussion and Analysis of Financial
Condition and Results of Operations ("MD&A") included in Item 2 of this
Quarterly Report. The Canadian Supplement should also be read in conjunction
with the unaudited Consolidated Financial Statements and Notes prepared in
accordance with U.S. GAAP (included in Item 1), the unaudited Consolidated
Financial Statements and Notes prepared in accordance with Canadian generally
accepted accounting principles ("Canadian GAAP")(included in exhibit 99) and the
audited Consolidated Financial Statements and Notes included in the Company's
Annual Report for the fiscal year ended December 31, 2001.

The following contains forward-looking statements and should be read in
conjunction with the factors set forth in the "Forward-looking statements"
section of the MD&A in Item 2 of this Quarterly Report. All dollar amounts in
this Canadian Supplement are in thousands of United States dollars unless
otherwise stated. The Canadian Supplement has been prepared by management to
provide an analysis of the material differences between Canadian GAAP and U.S.
GAAP on GSI Lumonics Inc. financial condition and results of operations.

Results of Operations

                                                        Three Months Ended
                                                --------------------------------
($000s)                                         March 29, 2002    March 30, 2001
                                                --------------    --------------
Income (loss) before income taxes
  - Canadian GAAP...........................       $ (9,343)         $ 8,918
  - U.S. GAAP...............................       $(10,220)         $ 7,526

Net income (loss)
  - Canadian GAAP...........................       $ (6,076)         $ 5,518
  - U.S. GAAP...............................       $ (6,620)         $ 4,779

Net income (loss) per common share diluted
  - Canadian GAAP...........................       $  (0.15)         $  0.13
  - U.S. GAAP...............................       $  (0.16)         $  0.12

Business Combinations

On March 22, 1999, Lumonics Inc. and General Scanning, Inc. ("General Scanning")
completed a merger of equals to form the Company. Under Canadian GAAP, the
merger was accounted for using the pooling of interests method and the
consolidated financial statements reflect the combined historical carrying
values of the assets, liabilities, stockholders' equity and the historical
operating results of the two predecessor companies.

Under US GAAP, the merger has been accounted for as a purchase transaction. The
purchase price, based on the fair value of General Scanning shares purchased, is
allocated in the consolidated financial statements to acquired net identifiable
General Scanning assets. Property, plant and equipment and acquired intangible
assets were recorded at their estimated fair values at the time of the 1999
acquisition and are being amortized over their useful life.

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The Canadian GAAP loss was lower than the corresponding U.S. GAAP amounts due to
amortization of lower net book values of property, plant and equipment and
acquired intangible assets resulting from different methods of accounting for
the business combination. The different net book values resulted in a lower
depreciation and amortization expense under Canadian GAAP by $0.9 million and
$0.9 million for the three months ended March 29, 2002 and March 30, 2001,
respectively.

Stock compensation expense is not recorded in the Company's earnings under
Canadian GAAP but U.S. GAAP reflects compensation expense of $nil and $0.2
million for the three months ended March 29, 2002 and March 30, 2001,
respectively.

Under Canadian GAAP, global investment tax credits are required to be netted
against research and development expense. Under U.S. GAAP, these amounts are
included in the income tax provision. This difference had no impact for the
three months ended March 29, 2002. For the three months ended March 30, 2001,
the Canadian GAAP net income before income taxes was $0.3 million more than the
U.S. GAAP net income before income taxes.

Intangible assets resulting from using the purchase method of accounting for the
business combination created an additional deferred income tax liability on the
U.S. GAAP balance sheet. The tax benefit related to amortization of this
additional amount increased the U.S. GAAP income tax recovery by $0.3 million
for the three months ended March 29, 2002 and by $0.3 million for the three
months ended March 30, 2001.

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