II-VI Incorporated Reports Fiscal Third Quarter Earnings

II-VI Incorporated Reports Fiscal Third Quarter Earnings

PITTSBURGH, April 23, 2013 (GLOBE NEWSWIRE) -- II-VI Incorporated
(Nasdaq:IIVI) today reported results for its third fiscal quarter ended March
31, 2013.

Bookings for the quarter decreased 4% to $140,332,000 compared to $145,776,000
in the third quarter of last fiscal year. Bookings for the nine months ended
March 31, 2013 decreased 3% to $381,859,000 compared to $392,906,000 for the
same period last fiscal 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 9% to $145,170,000 from $132,590,000 in the
third quarter of last fiscal year. Revenues for the nine months ended March
31, 2013 increased 1% to $403,351,000 from $397,720,000 for the same period
last fiscal year.

Net earnings attributed to II-VI Incorporated for the quarter were
$15,869,000, or $0.25 per share-diluted, compared to net earnings of
$13,994,000, or $0.22 per share-diluted, in the third quarter of last fiscal
year. For the nine months ended March 31, 2013, net earnings attributable to
II-VI Incorporated were $40,787,000, or $0.64 per share-diluted, compared to
net earnings of $45,860,000, or $0.71 per share-diluted, for the same period
last fiscal year.

Results include the following:

  *Transaction expenses related to three acquisitions completed during the
    quarter ended December 31, 2012 were insignificant for the current three
    months and were $1.1 million or $0.02 per share-diluted for the nine
    months ended March 31, 2013. These expenses are included in selling,
    general and administrative expenses in the condensed consolidated
    statements of earnings.
    
  *Write-downs of tellurium and selenium inventory were insignificant for the
    current three months and were $1.3 million, or $0.02 per share-diluted,
    for the nine months ended March 31, 2013.These amounts compare to
    write-downs of tellurium and selenium inventory of $3.6 million, or $0.06
    per share-diluted, and $6.1 million, or $0.10 per share-diluted, for the
    three and nine months ended March 31, 2012, respectively.These
    write-downs, taken by Pacific Rare Specialty Metals & Chemicals, Inc.
    (PRM), a business in the Military & Materials segment, were necessitated
    by declines in global raw material index pricing.This expense is included
    in cost of goods sold in the attached condensed consolidated statements of
    earnings.
    
  *After-tax income of $3.7 million, or $0.06 per share-diluted, was
    recognized for the nine months ended March 31, 2013 from a settlement with
    a former contract manufacturer for damages incurred in the October 2011
    flooding in Thailand.The majority of the settlement amount is included in
    other expense (income), net in the attached condensed consolidated
    statements of earnings.

Francis J. Kramer, president and chief executive officer said, "We are
reporting third quarter fiscal 2013 results in line with the guidance we
issued on January 22, 2013.The results reflect operational improvements in
several of our businesses, including Marlow Industries in our Advanced Product
Group segment, as they begin to capitalize on new market opportunities. In
addition, we also received full-quarter contributions from the three recent
acquisitions we completed during the quarter ended December 31, 2012. We have
experienced some cyclical softening in the optical communication market
addressed primarily by our Near-Infrared Optics segment."

Kramer continued, "In the Military and Materials segment, PRM continues to be
impacted by the start-up of its new rare earth product line.We have lowered
our expectations of this product line for the upcoming fourth quarter and have
made long-term contractual adjustments with our customer, which should help
improve operating results going forward.Demand for selenium and tellurium
products continues to be low and, therefore, the pricing environment is a
challenge.During the quarter, PRM did not experience any significant
write-downs of its selenium and tellurium inventory, as was the case in the
previous six quarters."

Kramer concluded, "As anticipated, our tax rate reflects a favorable
adjustment for the recent extension of the U.S. Research and Development Tax
Credit. Cash generated from operations has increased 18% year over year and we
are investing in strategic capacity initiatives and paying down long-term
debt.During the quarter we completed the $25 million share repurchase program
authorized in May 2012."

During the quarter ended December 31, 2012, the Company completed three
acquisitions:
November 1, 2012  M Cubed Technologies, Inc. (M Cubed)
                  The thin-film filter business and interleaver product line
December 3, 2012  of Oclaro, Inc. (the Thin-Film Filter andInterleaver
                  Operations)
December 21, 2012 LightWorks Optics, Inc. (LightWorks)

M Cubed joined the Advanced Products Group, the Thin-Film Filter and
Interleaver Operations became a part of Photop Technologies, Inc. in the
Near-Infrared Optics segment, and LightWorks joined the Military & Materials
segment.

As discussed below under "Use of Non-GAAP Financial Measures," the Company is
presenting Non-GAAP financial measures in this release.Investors should
consider adjusted measures in addition to, and not as a substitute for, or
superior to, financial performance measures prepared in accordance with
generally accepted accounting principles ("GAAP").Please refer to the
attached reconciliation between GAAP and adjusted financial measures prepared
in accordance with GAAP and the Non-GAAP adjusted financial measures.

                             Segment Information

The following segment information includes segment earnings (defined as
earnings before income taxes, interest expense and other expense or income,
net).Management believes segment earnings are a useful performance measure
because they reflect the results of segment performance over which management
has direct control. Effective July 1, 2012, the Company changed its segment
reporting structure to include VLOC in the Company's Military & Materials
segment.VLOC was previously reported in the Company's Near-Infrared Optics
segment.All segment information presented in this earnings release has been
retrospectively adjusted to include VLOC in the Military & Materials segment.

             Three Months Ended               Nine Months Ended
             March 31,                        March 31,
                                 %                              %
                                 Increase                       Increase
$000's,       2013       2012       (Decrease) 2013       2012       (Decrease)
except %
                                                               
Bookings:                                                       
Infrared      $51,170  $59,112  (13)%      $143,271 $153,983 (7)%
Optics
Near-Infrared 32,847     48,575     (32)%      103,630    110,355    (6)%
Optics
Military &    22,070     26,553     (17)%      67,285     84,430     (20)%
Materials
Advanced
Products      34,245     11,536     197%       67,673     44,138     53%
Group
Total         $140,332 $145,776 (4)%       $381,859 $392,906 (3)%
Bookings
                                                               
Revenues:                                                       
Infrared      $52,886  $50,678  4%         $149,852 $148,236 1%
Optics
Near-Infrared 35,821     36,629     (2)%       113,463    100,143    13%
Optics
Military &    28,869     30,054     (4)%       74,164     91,480     (19)%
Materials
Advanced
Products      27,594     15,229     81%        65,872     57,861     14%
Group
Total         $145,170 $132,590 9%         $403,351 $397,720 1%
Revenues
                                                               
                                                               
Segment
Earnings                                              
(Loss):
Infrared      $13,969  $13,845  1%         $36,343  $37,672  (4)%
Optics
Near-Infrared 3,774      3,608      5%         16,637     8,554      95%
Optics
Military &    (550)      (958)      43%        (3,773)    64         (5,995)%
Materials
Advanced
Products      810        479        69%        325        7,957      (96)%
Group
Total Segment $18,003  $16,974  6%         $49,532  $54,247  (9)%
Earnings

                     Other Selected Financial Information

The following other selected financial information includes earnings before
interest, income taxes, depreciation and amortization (EBITDA).The Company
believes EBITDA is a useful performance measure because it reflects operating
profitability before certain non-operating expenses and non-cash charges.



                                     Three Months Ended  Nine Months Ended
                                     March 31,           March 31,
$000's, except share information      2013      2012      2013       2012
                                                                 
EBITDA                                $30,163 $28,014 $86,238  $85,255
Cash paid for capital expenditures    $4,321  $9,703  $17,498  $32,771
Net borrowings (repayments) on        $(3,000)  $(7,000)  $109,000 $(6,295)
indebtedness
Share-based compensation expense,     $2,698  $2,055  $9,232   $9,231
pre-tax
Cash paid for shares repurchased
through the Company's share           $9,138  $ --      $19,978  $ --
repurchase program
Shares repurchased through the        523,980   --        1,141,022  --
Company's share repurchase program

                                   Outlook

For the fourth fiscal quarter ending June 30, 2013, the Company currently
forecasts revenues to range from $147 million to $152 million and earnings per
share to range from $0.20 to $0.25.Comparable results for the quarter ended
June 30, 2012 were revenues of $136.9 million and earnings per share of
$0.22.For the fiscal year ending June 30, 2013, the Company currently expects
revenues to range from $550 million to $555 million and earnings per share to
range from $0.84 to $0.89.Comparable results for the year ended June 30, 2012
were revenues of $534.6 million and earnings per share of $0.94.As discussed
in more detail below, actual results may differ from these forecasts due to
various factors including, but not limited to, changes in product demand,
competition and general economic conditions.

                             Webcast Information

The Company will host a conference call at 9:00 a.m. Eastern Time on Tuesday,
April 23, 2013 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://tinyurl.com/cjzg3e5.A replay of the webcast will be available for 2
weeks following the call.

                      Use of Non-GAAP Financial Measures

The Company has disclosed adjusted financial measurements in this press
release that present financial information that is not in accordance with
GAAP.These measurements are not a substitute for GAAP measurements, although
the Company's management uses these measurements as an aid in monitoring the
Company's on-going financial performance.The adjusted Non-GAAP net earnings
attributable to II-VI Incorporated and adjusted Non-GAAP earnings per share
measure the earnings of the Company excluding unusual items that are
considered by management to be outside of the normal on-going operations of
the Company. There are limitations associated with the use of Non-GAAP
financial measures, including that Non-GAAP financial measures used by the
Company may be calculated differently from, and therefore may not be
comparable to, similarly titled measures used by other companies, that there
can be no assurance that excluded items in the Non-GAAP financial measures
will not occur in the future and that there could be cash costs associated
with items excluded in the Non-GAAP financial measures.The Company
compensates for these limitations by using these Non-GAAP financial measures
as supplements to GAAP financial measures and by providing the reconciliations
of the Non-GAAP financial measures to their most comparable GAAP financial
measures. Investors should consider adjusted measures in addition to, and not
as a substitute for, or superior to, financial performance measures prepared
in accordance with GAAP.

                           About II-VI Incorporated

II-VI Incorporated, a global leader in engineered materials and
opto-electronic components, is a vertically-integrated manufacturing company
that creates and markets products for diversified markets including industrial
manufacturing, military and aerospace, high-power electronics, optical
communications, and thermoelectronics applications.Headquartered in
Saxonburg, Pennsylvania, with manufacturing, sales, and distribution
facilities worldwide, the Company produces numerous crystalline compounds
including zinc selenide for infrared laser optics, silicon carbide for
high-power electronic and microwave applications, and bismuth telluride for
thermoelectric coolers.

In the Company's infrared optics business, II-VI Infrared manufactures optical
and opto-electronic components for industrial laser and thermal imaging
systems and HIGHYAG Lasertechnologie GmbH (HIGHYAG) manufactures
fiber-delivered beam delivery systems and processing tools for industrial
lasers.

In the Company's near-infrared optics business, Photop Technologies, Inc.
(Photop) manufactures crystal materials, optics, microchip lasers and
opto-electronic modules for use in optical communication networks and other
diverse consumer and commercial applications.Photop Aegis, Inc. (Aegis)
manufactures tunable optical devices required for high speed optical networks
that provide the bandwidth expansion necessary for increasing internet
traffic.Through its Australian subsidiary, Photop AOFR Pty Limited, Aegis
also manufactures fused fiber components, including those required for fiber
lasers for material processing applications, as well as optical couplers used
primarily in the optical communication industry.

In the Company's military & materials business, Exotic Electro-Optics (EEO)
manufactures infrared products for military applications, Pacific Rare
Specialty Metals & Chemicals (PRM) produces and refines selenium and tellurium
materials and Max Levy Autograph, Inc. (MLA) manufactures micro-fine
conductive mesh patterns for optical, mechanical and ceramic components for
applications such as circuitry, metrology standards, targeting calibration and
suppression of electro-magnetic interference. VLOC manufactures near-infrared
and visible light products for industrial, scientific, military, medical
instruments and laser gain materials and products for solid-state YAG and YLF
lasers. LightWorks Optics, Inc. (LightWorks) manufactures precision optical
systems and components for defense, aerospace, industrial and life science
applications.

In the Company's advanced products group, the Wide Bandgap Materials (WBG)
group manufactures and markets single crystal silicon carbide substrates for
use in the solid-state lighting, wireless infrastructure, RF electronics and
power switching industries. Marlow Industries, Inc. (Marlow) designs and
manufactures thermoelectric cooling and power generation solutions for use in
defense, space, photonics, telecommunications, medical, consumer and
industrial markets.Worldwide Materials Group (WMG) provides expertise in
materials development, process development and manufacturing scale up. M Cubed
Technologies, Inc. (M Cubed) develops and markets advanced composite materials
serving the semiconductor, display, industrial and defense markets.

                          Forward-looking Statements

This press release contains forward-looking statements based on certain
assumptions and contingencies that involve risks and uncertainties.The
forward-looking statements are made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995 and relate to the
Company's performance on a going-forward basis.The forward-looking statements
in this press release involve risks and uncertainties, which could cause
actual results, performance or trends to differ materially from those
expressed in the forward-looking statements herein or in previous
disclosures.The Company believes that all forward-looking statements made by
it have a reasonable basis, but there can be no assurance that management's
expectations, beliefs or projections as expressed in the forward-looking
statements will actually occur or prove to be correct.In addition to general
industry and global economic conditions, factors that could cause actual
results to differ materially from those discussed in the forward-looking
statements in this press release include, but are not limited to: (i) the
failure of any one or more of the assumptions stated above to prove to be
correct; (ii) the risks relating to forward-looking statements and other "Risk
Factors" discussed in the Company's Annual Report on Form 10-K for the fiscal
year ended June 30, 2012; (iii) the purchasing patterns from customers and
end-users; (iv) the timely release of new products, and acceptance of such new
products by the market; (v) the introduction of new products by competitors
and other competitive responses; and/or (vi) the Company's ability to devise
and execute strategies to respond to market conditions.The Company disclaims
any obligation to update information contained in these forward-looking
statements whether as a result of new information, future events or
developments, or otherwise.

II-VI Incorporated and Subsidiaries
Condensed Consolidated Statements of Earnings (Unaudited)
($000 except per share data)
                                                                
                                    Three Months Ended Nine Months Ended
                                    March 31,          March 31,
                                    2013      2012      2013       2012
Revenues                                                        
Net sales:                                                       
Domestic                             $65,176 $51,233 $168,938 $156,958
International                        79,994    81,357    234,413    240,762
Total Revenues                       145,170   132,590   403,351    397,720
                                                                
                                                                
Costs, Expenses & Other Expense                                  
(Income)
Cost of goods sold                  94,169    86,589    256,645    253,241
Internal research and development    5,781     5,698     16,992     15,877
Selling, general and administrative  27,217    23,329    80,182     74,355
Interest expense                     449       48        708        184
Other expense (income), net          (1,401)   (2,311)   (6,713)    (5,447)
Total Costs, Expenses, and Other     126,215   113,353   347,814    338,210
Expense (Income)
                                                                
Earnings Before Income Taxes         18,955    19,237    55,537     59,510
                                                                
Income Taxes                         2,861     4,967     13,844     13,006
                                                                
Net Earnings                         16,094    14,270    41,693     46,504
Less:Net Earnings Attributable to   225       276       906        644
Noncontrolling Interests
Net Earnings Attributable to II-VI   $15,869 $13,994 $40,787  $45,860
Incorporated
Net Earnings Attributable to II-VI
Incorporated Diluted Earnings Per    $0.25   $0.22   $0.64    $0.71
Share:
Net Earnings Attributable to II-VI
Incorporated Basic Earnings Per      $0.26   $0.22   $0.65    $0.73
Share:

Average Shares Outstanding- Diluted 63,724    64,628    63,965     64,314
Average Shares Outstanding- Basic   62,130    62,855    62,482     62,752

                                                       
II-VI Incorporated and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
($000)
                                             March 31,  June 30,
                                             2013       2012
Assets                                                  
Current Assets                                          
Cash and cash equivalents                     $155,594 $134,944
Accounts receivable                          103,640    104,761
Inventories                                   152,873    137,607
Deferred income taxes                         9,652      10,796
Prepaid and refundable income taxes           6,549      8,488
Prepaid and other current assets              12,600     13,777
Total Current Assets                          440,908    410,373
Property, plant & equipment, net              173,206    153,918
Goodwill                                      122,330    80,748
Other intangible assets, net                  88,556     44,014
Investment                                    10,977     10,661
Deferred income taxes                         3,507      145
Other assets                                  9,305      6,627
Total Assets                                  $848,789 $706,486
                                                       
Liabilities and Shareholders' Equity                    
Current Liabilities                                     
Accounts payable                              $25,248  $29,420
Accruals and other current liabilities        55,809     54,308
Total Current Liabilities                     81,057     83,728
Long-term debt                                121,183    12,769
Deferred income taxes                         4,375      5,883
Other liabilities                             14,248     12,720
Total Liabilities                             220,863    115,100
                                                       
Total II-VI Incorporated Shareholders' Equity 626,229    589,957
Noncontrolling Interests                      1,697      1,429
Total Shareholders' Equity                    627,926    591,386
Total Liabilities and Shareholders' Equity    $848,789 $706,486

                                                                  
II-VI Incorporated and Subsidiaries
Condensed Consolidated Statements of Cash Flows (Unaudited)
($000)                                                   Nine Months Ended
                                                        March 31,
                                                        2013       2012
Net cash provided by operating activities                $68,119  $57,702
                                                                  
Cash Flows from Investing Activities                               
Additions to property, plant and equipment               (17,498)   (32,771)
Purchases of businesses, net of cash acquired            (126,165)  (46,141)
Proceeds received on contractual settlement from         2,436      --
Thailand flood
Proceeds from collection of note receivable              1,395      1,906
Other investing activities                               57         18
Net cash used in investing activities                    (139,775)  (76,988)
                                                                  
Cash Flows from Financing Activities                               
Proceeds from long-term borrowings                       113,000    7,000
Payments on long-term borrowings                         (4,000)    (13,295)
Payment of debt issuance costs                           (560)      --
Purchases of treasury stock                              (19,978)   --
Payments on earn-out arrangement                         --         (6,000)
Proceeds from exercises of stock options                 3,836      1,896
Distributions on noncontrolling interests                (284)      --
Minimum tax withholding requirements                     (137)      --
Excess tax benefits from share-based compensation        678        469
expense
Net cash provided by (usedin) financing activities      92,555     (9,930)
                                                                  
Effect of exchange rate changes on cash and cash         (249)      (978)
equivalents
                                                                  
Net increase (decrease) in cash and cash equivalents     20,650     (30,194)
                                                                  
Cash and Cash Equivalents at Beginning of Period         134,944    149,460
Cash and Cash Equivalents at End of Period               $155,594 $119,266

                                                                 
II-VI Incorporated and Subsidiaries
Reconciliation of Selected Non-GAAP Financial Measurements
($000 except per share amounts)
                                                                 
                                                                 
Reconciliation of Reported Net                                    
Earnings to Non-GAAP Net Earnings
(Unaudited)                                                       
                                                                 
                                      Three Months Ended Nine Months Ended
                                      March 31,          March 31,
                                      2013      2012      2013      2012
                                                                 
Reported Net Earnings Attributable to  $15,869 $13,994 $40,787 $45,860
II-VI Incorporated
                                                                 
                                                                 
Add back:                                                         
Write-downs of tellurium and selenium  71        3,840     1,395     6,447
inventory
                                                                 
Income tax impact on unusual items     (4)       (191)     (70)      (322)
                                                                 
Adjusted Non-GAAP Net Earnings         $15,936 $17,643 $42,112 $51,985
Attributable to II-VI Incorporated
                                                                 
Per share data:                                                   
Net Earnings Attributable to II-VI                                
Incorporated:
Net Earnings Attributable to II-VI
Incorporated Diluted Earnings Per      $0.25   $0.22   $0.64   $0.71
Share:
Net Earnings Attributable to II-VI     $0.26   $0.22   $0.65   $0.73
Incorporated Basic Earnings Per Share:
                                                                 
Per share, After-Tax Impact of
Write-Downs of Tellurium and Selenium                             
Inventory on:
Net Earnings Attributable to II-VI
Incorporated Diluted Earnings Per      $0.00     $0.06   $0.02   $0.10
Share:
Net Earnings Attributable to II-VI     $0.00     $0.06   $0.02   $0.10
Incorporated Basic Earnings Per Share:
                                                                 
Adjusted Non-GAAP Net Earnings                                    
Attributable to II-VI Incorporated:
Adjusted Non-GAAP Net Earnings Diluted $0.25   $0.27   $0.66   $0.81
Earnings Per Share:
Adjusted Non-GAAP Net Earnings Basic   $0.26   $0.28   $0.67   $0.83
Earnings Per Share:

Below is a reconciliation of the Segment Earnings and EBITDA reported in this
press release to reported Net Earnings.

Reconciliation of Segment                                     
Earnings and EBITDA to Net Earnings Three Months Ended  Nine Months Ended
                                   March 31,           March 31,
                                   2013      2012      2013      2012
                                                              
Total Segment Earnings              $18,003 $16,974 $49,532 $54,247
Interest expense                    449       48        708       184
Other expense (income), net         (1,401)   (2,311)   (6,713)   (5,447)
Income taxes                        2,861     4,967     13,844    13,006
Net earnings                       $16,094 $14,270 $41,693 $46,504
                                                              
EBITDA                              $30,163 $28,014 $86,238 $85,255
Interest expense                    449       48        708       184
Depreciation and amortization       10,759    8,729     29,993    25,561
Income taxes                        2,861     4,967     13,844    13,006
Net earnings                        $16,094 $14,270 $41,693 $46,504

CONTACT: II-VI Incorporated
         Craig A. Creaturo, Chief Financial Officer and Treasurer
         (724) 352-4455
         ccreaturo@ii-vi.com